What changed in this filing

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Item 1A. Risk Factors

2023-03-27 compared with 2022-03-28 · 667 added, 421 removed, 1200 unchanged (48% of the section changed)

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These risks include, among others, the following:

have in the past been adversely affected by COVID-19 and may continue to be adversely affected by COVID-19 and/or governmental responses

thereto, supply chain issues relating thereto;

are currently unprofitable, have recently generated net losses, and we may incur losses in the future;

may need additional financing in the future, which may not be available on favorable terms, if at all;

have in the past been adversely affected by COVID-19 and may in the future be adversely affected

by COVID-19 and/or governmental responses thereto, as well as supply chain issues relating

are currently unprofitable, have generated net losses, and we may incur losses in the future;

may need additional financing in the future, which may not be available on favorable terms,

may not be able to manage our future growth;

of our competitors are better established and have resources significantly greater than we do;

will need to expand our member base or our profit margins to attain profitability;

of our competitors are better established and have resources significantly greater than ours;

face risks associated with our operations within the pharmaceutical distribution market;

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rely on third party contracts, which may not be renewed or may be terminated;

are currently facing and may in the future face difficulties in sourcing products and inventory due to a variety of causes;

have in the past, and may in the future, not be able to sell our inventory, at or above the price we acquired such inventory for,

and have in the past, and may in the future, be forced to write-down inventory and certain of our other assets which may have a material

adverse effect on our balance sheet;

have in the past, and may in the future, not receive products or receive refunds for deposited amounts and have experience losses

in connection with such deposits;

may be subject to claims that we violated intellectual property rights of others, which are extremely costly to defend and could

require us to pay significant damages and limit our ability to operate;

business and operations depend on the proper functioning of information systems, critical facilities and distribution networks and

a disruption, cyber-attack, failure or destruction of such networks, systems, or technologies may disrupt our business or result

in liability;

may be losses or unauthorized access to or releases of confidential information, including personally identifiable information, that

could subject the Company to significant reputational, financial, legal and operational consequences;

face risks associated with our business in the telehealth market, including risks associated with legal challenges, relationships

with third parties and affiliated professionals, our network of qualified providers, competition for services;

new technologies,

failure to develop widespread brand awareness and regulatory risks;

certificate of incorporation limits the liability of our officers and directors and provides for indemnification rights, mandatory

forum selection provisions and limits the ability of stockholders to call special meetings of stockholders;

are currently facing and may in the future face difficulties in sourcing products and inventory

due to a variety of causes;

have in the past, and may in the future, not be able to sell our inventory, at or above the

price we acquired such inventory for, have in the past, and may in the future, be forced

to write-down inventory and certain of our other assets which may have a material adverse

effect on our balance sheet;

have in the past, and may in the future, not receive products or receive refunds for deposited

amounts and have experienced losses in connection with such deposits;

may be subject to claims that we violated intellectual property rights of others, which are

extremely costly to defend and could require us to pay significant damages and limit our

ability to operate;

business and operations depend on the proper functioning of information systems, critical

facilities and distribution networks and a disruption, cyber-attack, failure or destruction

of such networks, systems, or technologies may disrupt our business or result in liability;

may be losses or unauthorized access to or releases of confidential information, including

personally identifiable information, that could subject the Company to significant reputational,

financial, legal and operational consequences;

face risks associated with our business in the telehealth market, including risks associated

with legal challenges, relationships with third parties and affiliated professionals, our

network of qualified providers, competition for services;

new technologies, failure to develop

widespread brand awareness and regulatory risks from the Office of Inspector General, U.S.

Department of Health and Human Services (OIG) and the United States Department of Justice

(DOJ) around the practice of telehealth and expiring COVID-19 waivers;

certificate of incorporation limits the liability of our officers and directors and provides

for indemnification rights, mandatory forum selection provisions and limits the ability of

stockholders to call special meetings of stockholders;

incur significant costs to ensure compliance with U.S.

and NASDAQ Capital Market reporting and corporate governance requirements;

may not be able to comply with NASDAQ’s continued listing standards;

and NASDAQ Capital Market reporting

and corporate governance requirements;

are not currently in compliance with NASDAQ’s continued listing requirements and may

not be able to maintain the listing of our common stock on the NASDAQ Capital Market;

changes that affect our distribution channels could harm our business;

fraud laws are often vague and uncertain, exposing us to potential liability;

and expanded laws or regulations could have a material adverse effect on our business operations, cash flows or future prospects;

public health crisis involving the abuse of prescription opioid pain medication could have a material negative effect on our business;

and expanded laws or regulations could have a material adverse effect on our business operations,

cash flows or future prospects;

public health crisis involving the abuse of prescription opioid pain medication could have

a material negative effect on our business;

● Consolidation

healthcare industry may negatively impact our results of operations;

have identified material weaknesses in our internal control over financial reporting and controls and procedures;

may not be sufficient liquidity in the market for our securities in order for investors to sell their shares.

The market price of

our common stock may continue to be volatile;

may experience dilution to future equity sales, the exercise or conversion of outstanding convertible securities or future transactions;

Chief Executive Officer and President are our two largest stockholders and, as a result, they can exert control over us and have

actual or potential interests that may differ from yours;

have identified material weaknesses in our internal control over financial reporting and

controls and procedures;

may not be sufficient liquidity in the market for our securities in order for investors to

sell their shares.

The market price of our common stock may continue to be volatile;

● Stockholders

may experience dilution to future equity sales, the exercise or conversion of outstanding

convertible securities or future transactions;

results of operations are subject to rising inflation, rising interest rates, governmental

responses thereto and possible recessions caused thereby;

Chief Executive Officer and President are our two largest stockholders and, as a result,

they can exert significant control over us and have actual or potential interests that may

differ from yours;

associated with the JOBS Act and our status as an emerging growth company;

associated with future acquisitions, including unknown liabilities and difficulty integrating such acquisitions;

associated with future acquisitions, including unknown liabilities and difficulty integrating

such acquisitions;

security attacks and website problems;

litigation, government investigations, and other proceedings that may adversely affect our business and results of operations

is substantial doubt regarding our ability to continue as a going concern;

may see a plateau in our Tele-Vet services offering due to a lack of providers as we are

not marketing the service;

may be changes in state law concerning the definition of “Tele-Vet” services

which may hinder our ability to provide services without an in-person visit to establish

This is known as establishing a veterinarian-client-patient relationship (VCPR);

litigation, government investigations, and other proceedings that may adversely affect our

business and results of operations.

should be aware that there are substantial risks for an investment in our common stock.

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business, financial condition and results of operations are subject to various risks and uncertainties, including those described below.

This section discusses factors that, individually or in the aggregate, could cause our actual results to differ materially from expected

This section discusses factors that, individually or in aggregate, could cause our actual results to differ materially from expected

and historical results.

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discussion of all potential risks or uncertainties applicable to our business.

have been, and may in the future be, adversely affected by the global COVID-19 pandemic, the duration and economic, governmental and

social impact of which is difficult to predict, which may significantly harm our business, prospects, financial condition and operating

2020 and continuing into 2022, there has been a widespread worldwide impact from the COVID-19 pandemic, and we have been, and may in

the future be, adversely affected as a result.

The outbreak of the COVID-19 coronavirus, the global response to such coronavirus, including

travel restrictions and quarantines that governments instituted during 2020 and 2021, adversely affected our operations, and future restrictions

or governmental requirements may have an adverse effect on our operations in the future, and/or may have a significant negative impact

on our results of operations, the production of pharmaceuticals and our ability to timely obtain pharmaceuticals for resale.

we are experiencing reductions to, and interruptions in, the delivery of supply chain pharmaceuticals that are having a negative impact

on our wholesalers and certain technology outsourcing in India and the Philippines and we are also having a hard time finding qualified

staff, due to the pandemic.

Notwithstanding the above disruptions, our results of operations have not, to date, been materially adversely

affected by the pandemic.

However, if we continue to experience production difficulties, quality control problems or further shortages

in supply of pharmaceuticals or personnel in the future, this could harm our business and results of operations, any of which could have

a material adverse effect on our operations and the value of our securities.

In addition, employee sicknesses and remote working environments,

and the potential negative effect thereof on productivity and internal controls, related to the coronavirus and the federal, state and

local responses to such virus, could materially impact our consolidated results for the year 2022 and beyond.

The COVID-19 outbreak could

also restrict our access to capital such as credit facilities and lead to material nonrecurring charges, write-downs, impairments and

The Company is actively and continually monitoring the pandemic’s effect on our businesses and endeavoring to adapt quickly

in real time to meet the rapidly-changing demands of our Customers and Suppliers.

mitigate the spread of COVID-19, we implemented sanitation and personal protection measures.

Company’s corporate office reopened on January 3, 2022, in accordance to Center for Disease Control and Prevention (CDC) guidance,

allowing only management and certain key operational employees to return to the office, while hourly employees remain working remotely

until further notice.

These measures might not fully mitigate COVID-19 risks to our workforce, and we could experience unusual

levels of absenteeism that might impair operations and delay delivery of products.

The COVID-19 pandemic affects product manufacturing,

supply and transport availability and cost.

The pandemic has in the past reduced demand for some products due to delays or cancellations

of elective medical procedures, consumer self-isolation and business closures, among other reasons, which may become issues again in

the future if the number of persons infected does not continue to decline.

The COVID-19 pandemic also influences shortages of some products,

with product allocation resulting in delivery delays for customers.

Additionally, as a result of

the coronavirus outbreak, various states have adopted price gouging laws.

Our failure to comply with such laws and regulations could

subject us to claims, penalties, fines or lawsuits.

have been impacted and may be further impacted by COVID-19 as follows:

a result of COVID-19, various states have adopted price gouging laws.

Our failure to comply with such laws and regulations could

subject us to claims, penalties, fines or lawsuits;

price fluctuations as a result of supply and demand issues caused by COVID-19 have caused values of inventory to decrease, which

has had a direct impact on gross profit and has resulted in a direct write-off of certain inventory value;

Terms with customers may be altered or extended, which would have an impact on current ratios and cash flow;

have previously been material impairments with respect to goodwill and may be future material

impairments and/or effects on right-of-use assets as the evaluation of the long-term impact

to delivery of service or physical space assessments changes.

have been shortages in the supply of generic pharmaceuticals which impact our revenues as

our transaction fees revenue rely on the sale of generic pharmaceuticals through our marketplace

have been labor market challenges in hiring staff

may cause further disruptions to our business, including, but not limited to:

one or more of our customers to file for bankruptcy protection or shut down, including as a result of broader economic disruption;

health system or health plan subscription agreement fees generated, as well as visit fees, by customers or providers, as a result

of funding constraints related to loss of revenue or employment;

impacting collections of accounts receivable;

impacting our ability to facilitate the provision of our telehealth services due to unpredictable demand;

impacting our ability to forecast our business’s financial outlook;

regulatory uncertainty on our telehealth services, if certain restrictions on reimbursement or the practice of medicine across state

lines are reintroduced at some point in the future;

our business, results of operations and financial condition.

ongoing impacts of the pandemic may cause, or make more likely, a general economic slowdown or recession in one or more markets, disruptions

and volatility in global capital markets and other broad and adverse effects on the economy, business conditions, commercial activity

and the healthcare industry.

The pandemic might impact our business operations, financial position and results of operation in unpredictable

ways that depend on highly-uncertain future developments, such as determining the effectiveness of current or future government actions

to address the public health or economic impacts of the pandemic.

Any of these risks might have a materially adverse impact on our business

operations and our financial position or results of operations.

were recently unprofitable, we have recently generated net losses, and we may incur losses in the future.

generated from our consolidated operations for the years ended December 31, 2021 and 2020 were $9,889,433 and $17,122,520,

respectively.

incurred a net loss of $5,315,883 for the year ended December 31, 2021, compared to a net loss of $2,536,051 for the year ended December

We may incur other losses in the foreseeable future due to the significant costs associated with our business development,

including costs associated with maintaining compliance under SEC reporting standards.

We cannot assure you that our operations will annually

generate sufficient revenues to fund our continuing operations or to fully implement our business plan, and thereafter sustain profitability

in any future period.

generated from our consolidated operations for the years ended December 31, 2022 and 2021 were $11,448,265 and $9,889,433, respectively.

incurred a net loss of $3,909,868 for Fiscal 2022, compared to a net loss of $5,315,883 for the Fiscal 2021.

We may incur other losses

in the foreseeable future due to the significant costs associated with our business operations, including costs associated with maintaining

industry regulatory and licensure compliance.

We also incur significant compliance costs associated with maintaining SEC regulatory and

financial reporting requirements;

as well as costs to maintain minimum listing requirements of Nasdaq.

We cannot assure you

that our operations will annually generate sufficient revenues to fund our continuing operations or to fully implement our business plan,

and thereafter sustain profitability in any future period.

likelihood of our success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered

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affecting the distribution of pharmaceuticals in which we operate.

need additional capital which may not be available on commercially acceptable terms, if at all, which creates substantial doubt about

our ability to continue as a going concern.

historical financial statements have been prepared under the assumption that we will continue as a going concern.

As of December 31,

2022, the Company had an accumulated deficit of $19.7 million.

We have limited financial resources, as of December 31, 2022, we had working

capital of negative $0.053 million and a cash balance of $1.1 million.

We will need to raise additional capital or secure debt funding

to support on-going operations.

The sources of this capital are expected to be the sale of equity and debt, which may not be available

on favorable terms, if at all, and may, if sold, cause significant dilution to existing stockholders.

If we are unable to access additional

capital moving forward, it may hurt our ability to grow and to generate future revenues, our financial position, and liquidity.

matters, when considered in the aggregate, raise substantial doubt about the Company’s ability to continue as a going concern for

a reasonable period of time, which is defined as within one year after the date that our condensed financial statements are issued.

financial statements incorporated by reference herein do not contain any adjustments to reflect the possible future effects on the classification

of assets or the amounts and classification of liabilities that might result from the outcome of this uncertainty.

The doubt regarding

our potential ability to continue as a going concern may adversely affect our ability to obtain new financing on reasonable terms or

Additionally, if we are unable to continue as a going concern, our stockholders may lose some or all of their investment in the

financing may not be available to us when needed or, if available, it may not be obtained on commercially reasonable terms.

not able to obtain the necessary additional financing on a timely or commercially reasonable basis, we will be forced to delay or scale

down some or all of our development activities (or perhaps even cease the operation of our business).

Our access to additional capital

may be negatively affected by future recessions, downturns in the economy or the markets as a whole, or inflation.

we do not obtain additional financing, our business, prospects, financial condition and results of operations will be adversely affected.

October 4, 2022 the Company entered into a securities purchase agreement (the “ Purchase Agreement ”) with a certain

institutional investor (the “ Purchaser ”).

The Purchase Agreement provided for the sale and issuance by the Company

of an aggregate of:

(i) 920,000 shares (the “ Shares ”) of the Company’s common stock, $0.00001 par value (the

“ Common Stock ”), (ii) pre-funded warrants (the “ Pre-Funded Warrants ”) to purchase up to 601,740

shares of Common Stock and (iii) warrants (the “ Private Placement Warrants ” and, together with the Shares and the

Pre-Funded Warrants, the “ Securities ”) to purchase up to 2,663,045 shares of Common Stock.

The offering price per

Share was $1.15 and the offering price per Pre-Funded Warrant was $1.14999.

The Private Placement Warrants were sold in a concurrent

private placement (the “ Private Placement ”), exempt from registration pursuant to Section 4(a)(2) and/or Rule 506

of the Securities Act of 1933, as amended (the “ Securities Act ”).

anticipates that we will require additional working capital in the future to pursue continued development of products, services, and

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We cannot accurately predict the timing and amount of such capital requirements.

Additional financing may not be

available to us when needed or, if available, it may not be obtained on commercially reasonable terms.

If we are not able to obtain the

necessary additional financing on a timely or commercially reasonable basis, we will be forced to delay or scale down some or all of

our development activities (or perhaps even cease the operation of our business).

Additional financing may not

be available to us when needed or, if available, it may not be obtained on commercially reasonable terms.

Furthermore, the recent

developments on the financial industry may impair our ability to obtain bank financings.

If we are not able to obtain the necessary

additional financing on a timely or commercially reasonable basis, we will be forced to delay or scale down some or all of our

development activities (or perhaps even cease the operation of our business).

Our access to additional capital may be negatively

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needed, we may be required to reduce the scope of our operations or our anticipated expansion, which could have a material adverse effect

and global economic conditions could materially adversely affect the Company’s business, results of operations, financial condition

macroeconomic conditions, including inflation, slower growth or recession, new or increased tariffs, changes to fiscal and monetary policy,

tighter credit, higher interest rates, high unemployment and currency fluctuations could have a material adverse impact on demand for

the Company’s products and services.

In addition, consumer confidence and spending could be adversely affected in response to financial

market volatility, negative financial news, conditions in the real estate and mortgage markets, declines in income or asset values, changes

to fuel and other energy costs, labor and healthcare costs and other economic factors.

addition to an adverse impact on demand for the Company’s products, uncertainty about, or a decline in, U.S.

or global economic

conditions could have a significant impact on the Company’s suppliers, the pharmacy industry as a whole, the Company’s network

of independent pharmacies and other partners.

Potential effects include financial instability;

inability to obtain credit to finance

operations and purchases of the Company’s products, payment defaults and insolvency.

downturn in the economic environment could also lead to increased credit and collectability risk on the Company’s receivables;

limitations on the Company’s ability to raise new funding through the sale of debt or equity;

reduced liquidity;

and declines in

the value of the Company’s securities.

These and other economic factors could materially adversely affect the Company’s business,

results of operations, financial condition and growth.

we do not maintain a current and effective prospectus relating to the common stock issuable upon exercise of the Private Placement Warrants,

holders may exercise such Private Placement Warrants on a “cashless basis.”

we do not maintain a current and effective prospectus relating to the shares of common stock issuable upon exercise of the Private Placement

Warrants at the time that holders wish to exercise such warrants, they will be able to exercise them on a “cashless basis”.

As a result, the number of shares of common stock that holders will receive upon exercise of the Private Placement Warrants will be fewer

than it would have been had such holders exercised their Private Placement Warrants for cash.

Under the terms of the Purchase Agreement,

we have agreed to file a registration statement to register the shares of common stock issuable upon the exercise of the Private Placement

Warrants (the “Private Placement Warrant Shares”), as soon as practicable (and in any event within 60 calendar days of the

date of the Purchase Agreement), and use commercially reasonable efforts to cause such registration statement to become effective within

181 days following the closing date of the offering of the Securities and to keep such registration statement effective at all times

until the investor holds no Private Placement Warrants or Private Placement Warrant Shares issuable upon exercise thereof.

cannot assure you that we will be able to do so.

If the Private Placement Warrants are exercised on a “cashless” basis, we

will not receive any consideration from such exercises.

of the Private Placement Warrants could discourage an acquisition of us by a third party.

provisions of the Private Placement Warrants could make it more difficult or expensive for a third party to acquire us.

The Private Placement

Warrants prohibit us from engaging in certain transactions constituting “fundamental transactions” unless, among other things,

the surviving entity assumes our obligations under the Private Placement Warrants.

Further, the Private Placement Warrants provide that,

in the event of certain transactions constituting “fundamental transactions,” with some exception, holders of such warrants

will have the right, at their option, to require us to repurchase such warrants at a price described in such warrants.

These and other

provisions of the Private Placement Warrants could prevent or deter a third party from acquiring us even where the acquisition could

be beneficial to you.

Private Placement Warrants have certain anti-dilutive rights.

Private Placement Warrants include full ratchet anti-dilutive rights in the event any shares of common stock or other equity or equity

equivalent securities payable in common stock are granted, issued or sold (or the Company enters into any agreement to grant, issue or

sell), or in accordance with the terms of the warrant agreement evidencing the Private Placement Warrants, are deemed to have granted,

issued or sold, in each case, at a price less than the exercise price, which automatically decreases the exercise price of the Warrants

upon the occurrence of such event, as described in greater detail in the warrant agreement, subject to a minimum exercise price of $0.232

Such anti-dilution rights, if triggered, could result in a significant decrease in the exercise price of the Private Placement

Warrants, which could result in significant dilution to existing shareholders.

Private Placement Warrants are accounted for as liabilities and the changes in value of such Private Placement Warrants may have a material

effect on our financial results.

Placement Warrants, with certain terms as included in the Purchase Agreement should be accounted for as liability instruments.

the Company recorded warrant liability on the balance sheet as of December 31, 2022.

Under the liability accounting treatment, the Company

is required to measure the fair value of these instruments at the end of each reporting period and recognize changes in the fair value

from the prior period in the Company’s operating results for the current period.

As a result of the recurring fair value measurement,

our financial statements and results of operations may fluctuate quarterly based on factors which are outside our control.

the Private Placement Warrants are required to be accounted for under liability accounting treatment, we will recognize noncash gains

or losses due to the quarterly fair valuation of these warrants which could be material.

The impact of changes in fair value on our earnings

may have an adverse effect on the market price of our common stock and/or our stockholders’ equity, which may make it harder for

us to, or prevent us from, meeting the continued listing standards of The Nasdaq Capital Market.

issuance and sale of common stock upon exercise of the Private Placement Warrants may cause substantial dilution to existing stockholders

and may also depress the market price of our common stock .

Private Placement Warrants will be exercisable for up to 2,633,045 shares of common stock, provided that the Private Placement Warrants

contain a provision limiting each holder’s ability to exercise the warrants if such exercise would cause the holder’s (or

any affiliate of any such holder) holdings in the Company to exceed 4.99% of the Company’s issued and outstanding shares of common

stock (which may be increased or decreased with 61 days prior written notice from the holder, to up to 9.99% of the Company’s issued

and outstanding shares of common stock).

The ownership limitation does not prevent such holder from exercising some of the warrants,

selling those shares, and then exercising the rest of the warrants, while still staying below the 4.99% limit.

In this way, the holder

of the warrants could sell more than this limit while never actually holding more shares than this limit allows.

If the holder of the

warrants chooses to do this, it will cause substantial dilution to the then holders of our common stock.

exercises of the warrants and sales of such shares issuable upon exercise thereof take place, the price of our common stock may decline.

In addition, the common stock issuable upon exercise of the warrants may represent overhang that may also adversely affect the market

price of our common stock.

Overhang occurs when there is a greater supply of a company’s stock in the market than there is demand

for that stock.

When this happens the price of the company’s stock will decrease, and any additional shares which shareholders

attempt to sell in the market will only further decrease the share price.

If the share volume of our common stock cannot absorb shares

sold by the warrant holders, then the value of our common stock will likely decrease.

business is subject to rigorous regulatory and licensing requirements.

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the financial resources to do so.

Additionally, although we have evaluated appropriate state statutes and federal laws pertaining to

pharmaceutical distribution in an effort to diminish our risks, the Board of Pharmacy for each state is responsible for interpreting

Additionally, although we have evaluated appropriate state statutes and federal laws pertaining

to pharmaceutical distribution in an effort to diminish our risks, the Board of Pharmacy for each state is responsible for interpreting

their state laws, and their interpretations may not comport with our analysis.

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are currently facing and may in the future face difficulties in sourcing products and inventory due to a variety of causes.

to the continued effects of the COVID-19 pandemic, the governmental responses to contain the spread of such virus, we have

to date experienced issues with the availability of certain products, resulting in product allocation and delivery delays, which has

not to date, had a material adverse effect on our results of operations.

We might also experience difficulties and delays in sourcing

products and inventory due to a variety of causes in the future, such as:

difficulties in complying with the legal requirements for export

or import of pharmaceuticals or components;

to the continued effects of the COVID-19 pandemic, the governmental responses to contain the spread of such virus, we have to date experienced

issues with the availability of certain products, resulting in product allocation and delivery delays, which has not to date, had a material

adverse effect on our results of operations.

We might also experience difficulties and delays in sourcing products and inventory due

to a variety of causes in the future, such as:

difficulties in complying with the legal requirements for export or import of pharmaceuticals

or components;

suppliers’ failures to satisfy production demand;

manufacturing or supply problems

such as inadequate resources;

manufacturing or supply problems such as inadequate resources;

real or perceived quality issues;

and advanced deposits which are at risk of return if product is not delivered.

Difficulties in product manufacturing or access to raw materials could result in supplier production shutdowns, product shortages and

other supply disruptions.

Any of these risks might have a materially adverse impact on our business operations and our financial position

or results of operations.

Difficulties in product

manufacturing or access to raw materials could result in supplier production shutdowns, product shortages and other supply disruptions.

Any of these risks might have a materially adverse impact on our business operations and our financial position or results of operations.

have in the past, and may in the future, not be able to sell our inventory, at or above the price we acquired such inventory for, and

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might not receive products or the return of funds on deposits that have been provided.

We have two deposits outstanding as of the date

of this report in an aggregate amount of approximately $1,081,250.

In the event we do not receive the return of our deposits (through

litigation or otherwise), this will cause us financial harm and as a result the Company has taken a significant charge on our financial

statements by taking a loss in the amount of such deposit amount.

Additionally, in the future we may provide additional deposits for

products which may be material, which deposits may not be refunded timely, if at all, and which products may not be delivered, or may

be defective or unusable.

In the event we do not receive the return of our

deposits (through litigation or otherwise), this will cause us financial harm and as a result the Company has taken a significant charge

on our financial statements by taking a loss in the amount of such deposit amount.

Additionally, in the future we may provide additional

deposits for products which may be material, which deposits may not be refunded timely, if at all, and which products may not be delivered,

or may be defective or unusable.

Any significant losses of deposited funds could have a material adverse effect on our financial condition,

results of operations and the value of our securities.

July 2020, the Company’s wholly-owned subsidiary, Integra, entered into an agreement with Studebaker Defense Group, LLC (“Studebaker”)

wherein Integra would pay Studebaker a down payment of $500,000 and Studebaker would deliver 180,000 boxes of nitrile gloves by August

Integra wired the $500,000 to Studebaker, but to date, Studebaker has not delivered the gloves or provided a refund of the

On December 31, 2020, we filed a complaint against Studebaker in Florida state court, Case No.

20-CA-010118 in

the Circuit Court for the Thirteenth Judicial Circuit in Hillsborough County, for among other things, breach of contract.

29, 2021, Integra Pharma Solutions filed a motion for clerk’s default against Studebaker.

On February 2, 2021, the clerk of court

issued default against Studebaker.

On March 4, 2021, Integra Pharma Solutions filed a motion for final default judgment against Studebaker.

On March 22, 2021, counsel for Studebaker filed a notice of appearance in the case.

On March 24, Studebaker filed a response in opposition

to the motion for final judgment, and on March 25, 2021, Studebaker filed a motion to dismiss the case.

On May 14, 2021, the Court denied

Integra’s motion for final default judgment, granted Studebaker’s motion to set aside the clerk’s default, and denied

Studebaker’s motion to dismiss.

July 2020, the Company’s wholly-owned subsidiary, Integra, entered into an agreement with Studebaker Defense Group, LLC

(“ Studebaker ”) wherein Integra would pay Studebaker a down payment of $500,000 and Studebaker would deliver

180,000 boxes of nitrile gloves by August 14, 2020.

Integra wired the $500,000 to Studebaker, but to date, Studebaker has not

delivered the gloves or provided a refund of the deposit.

On December 31, 2020, we filed a complaint against Studebaker in Florida

state court, Case No.

20-CA-010118 in the Circuit Court for the Thirteenth Judicial Circuit in Hillsborough County, for among other

things, breach of contract.

On January 29, 2021, Integra Pharma Solutions filed a motion for clerk’s default against

On February 2, 2021, the clerk of court issued a default judgment against Studebaker.

On March 4, 2021, Integra Pharma

Solutions filed a motion for final default judgment against Studebaker.

On March 22, 2021, counsel for Studebaker filed a notice of

appearance in the case.

On March 24, Studebaker filed a response in opposition to the motion for final judgment, and on March 25,

2021, Studebaker filed a motion to dismiss the case.

On May 14, 2021, the Court denied Integra’s motion for final default

judgment, granted Studebaker’s motion to set aside the clerk’s default, and denied Studebaker’s motion to dismiss.

An amended answer and affirmative defenses were filed by Studebaker on October 14, 2021.

motion to strike the affirmative defenses, or in the alternative, motion for more definite statement is scheduled for hearing on April

We have also scheduled the deposition of Studebaker’s corporate representative on April 12, 2022, and moved to compel

better answers to outstanding discovery.

Integra’s motion to strike the

affirmative defenses, or in the alternative, motion for more definite statement is scheduled for hearing on April 27, 2022.

also scheduled the deposition of Studebaker’s corporate representative on April 12, 2022, and moved to compel better answers

to outstanding discovery.

The litigation remains pending and is in the discovery phase.

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successfully prosecute its claims against Studebaker on the merit.

On June 30, 2021, the $500,000 was recorded as Loss on

Inventory Investment.

August 2020, Integra, entered into an agreement with Sandwave Group Dsn Bhd (“Sandwave”), wherein Integra would pay Sandwave

a down payment of $581,250 and Sandwave’s supplier, Crecom Burj Group SDN BHD (“Crecom”), would deliver 150,000 boxes

of nitrile gloves within 45 days.

Integra wired the $581,250 to Sandwave, which in turn wired the purchase price to Crecom, which Crecom

On June 30, 2021, the $500,000 was recorded as Loss on Inventory

August 2020, Integra, entered into an agreement with Sandwave Group Dsn Bhd (“ Sandwave ”), wherein Integra would pay

Sandwave a down payment of $581,250 and Sandwave’s supplier, Crecom Burj Group SDN BHD (“ Crecom ”), would deliver

150,000 boxes of nitrile gloves within 45 days.

Integra wired the $581,250 to Sandwave, which in turn wired the purchase price to Crecom,

which Crecom accepted;

however, to date, Crecom has not delivered the nitrile gloves.

Integra demanded return of its $581,250 and Crecom has acknowledged

that Integra is entitled to a refund, but to date Crecom has failed to return Integra’s money.

In February 2021, Integra filed

a complaint against Crecom in Malaysia:

WA-22NCC-55-02/2021 in the High Court of Malaysia at Kuala Lumpur in the Federal Territory,

Malaysia for the Malaysian equivalent of breach of contract.

Integra demanded return of its $581,250 and Crecom

has acknowledged that Integra is entitled to a refund, but to date Crecom has failed to return Integra’s money.

In February 2021,

Integra filed a complaint against Crecom in Malaysia:

WA-22NCC-55-02/2021 in the High Court of Malaysia at Kuala Lumpur in the

Federal Territory, Malaysia for the Malaysian equivalent of breach of contract.

Crecom filed an appearance on March 1, 2021.

In April 2021, an Application

for Summary Judgment was filed with the court, and on May 25, 2021, the Court extracted the sealed application, and a copy thereof was

served on Crecom’s attorneys and Crecom, 14 days later, filed an Affidavit in Reply with the court alleging that there are issues

to be tried and that this case must go to a full trial.

On June 28, 2021, the court directed both parties to file their written submissions/arguments

in relation to the application for summary judgment on or before July 12, 2021, and scheduled a hearing thereon for August 26, 2021.

At the final hearing on October 18, 2021, the ruling for the summary judgment was denied and a trial date is pending.

The Company believes

that it will prevail in the lawsuit filed;

but the steps to enforce a judgment in Malaysia, if any, may be cumbersome, time consuming

2021, an Application for Summary Judgment was filed with the court, and on May 25, 2021, the Court extracted the sealed application,

and a copy thereof was served on Crecom’s attorneys and Crecom, 14 days later, filed an Affidavit in Reply with the court alleging

that there are issues to be tried and that this case must go to a full trial.

On June 28, 2021, the court directed both parties to file

their written submissions/arguments in relation to the application for summary judgment on or before July 12, 2021, and scheduled a hearing

thereon for August 26, 2021.

At the final hearing on October 18, 2021, the ruling for the summary judgment was denied and a trial date

The Company believes that it will prevail in the lawsuit filed;

but the steps to enforce a judgment in Malaysia, if any,

may be cumbersome, time-consuming or costly.

The Company cannot determine the timing of the judgment, nor the amount ultimately collected.

At June 30, 2021, the $581,250

was recorded as Loss on Inventory Investment.

On June 30, 2021, the $581,250 was recorded as Loss on Inventory Investment.

May 20, 2022, effective as of May 18, 2022, the Company’s wholly owned subsidiary Community Specialty Pharmacy, LLC (“ CSP ”)

entered into an agreement to acquire COVID-19 testing kits (the “ CSP Test Kits ”) from a third party vendor for an

aggregate of $1,200,000, of which $875,000 was paid on May 23, 2022.

The Company received the CSP Test Kits in July of 2022.

18, 2022, the Company was informed by the vendor that the vendor had received a letter from the U.S.

Food and Drug Administration (“ FDA ”)

that the CSP Test Kits were misbranded under Section 502(o) of the Federal Food.

Drug, and Cosmetic Act (“ FDC Act ”)

(21 USC 352(o)) and adulterated under Section 501(f) of the FDC Act (21 USC 351(f)).

Furthermore, the vendor informed the Company that

the letter from the FDA also stated that because of the FDA’s prohibition on the distribution of adulterated and/or misbranded

devices applies to all parties along the distribution chain, the FDA was advising the vendor against furthering the distribution of the

CSP Test Kits in interstate commerce.

At this time the Company has informed the vendor that it expects the vendor to provide a full return

of the $875,000 paid on May 23, 2022, along with any additional damages that the Company may incur.

As of December 31, 2022, $875,250

was recorded as a loss on inventory investment in the statement of operations for Fiscal 2022.

quarterly results have in the past, and may in the future, fluctuate significantly due to certain non-recurring sales of products.

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To date we have taken losses and/or write-downs on several businesses, products, services, and technologies.

For example, (a) we had

$725,973 of loss on impairment of goodwill for the year ended December 31, 2020, in connection with the acquisition of Community

Specialty Pharmacy, LLC;

(b) we designed and invested resources into the “Bonum Health Hub”, a self-enclosed, free standing

virtual examination room, which was launched by the Company’s wholly-owned Bonum Health, LLC, in November 2019 and was expected

to be operational in April 2020;

however, due to the COVID-19 pandemic, the Company does not anticipate installations moving forward,

and has taken a write off of the hubs purchased at June 30, 2021 in the amount of $143,891, which is included under loss on inventory

investments in the statement of operations for the year ended December 31, 2021;

and (c) we also used resources and funding

to create a Health Passport application during 2020 and 2021, which was planned to store a user’s health and vaccination status

and allow confirmation thereof via a QR code;

however, we did not generate any revenue from this product and the product was discontinued

at the end of December 2021.

The use of resources for new businesses and new products, services, and technologies, to the extent such

new businesses and new products, services, and technologies do not generate revenues or profits may take management’s focus and

time away from more profitable endeavors, may require the Company to take significant write-downs or write-offs, may take funding away

from the Company’s other operations or growth opportunities, which may ultimately be more profitable, and may have a material adverse

effect on the Company’s cash flows, liquidity and revenues, any or all of which may cause the value of the Company’s securities

to decline in value or become worthless.

had $725,973 of loss on impairment of goodwill for the fiscal year ended December 31, 2020, in connection with the acquisition of

Community Specialty Pharmacy, LLC;

designed and invested resources into the “Bonum Health Hub”, a self-enclosed, free standing virtual examination room,

which was launched by the Company’s wholly-owned Bonum Health, LLC, in November 2019 and was expected to be operational in

however, due to the COVID-19 pandemic, the Company does not anticipate installations moving forward, and has taken a

write off of the hubs purchased at June 30, 2021 in the amount of $143,891, which is included under loss on inventory investments

in the statement of operations for Fiscal 2021;

also used resources and funding to create a Health Passport application during 2020 and 2021, which was planned to store a user’s

health and vaccination status and allow confirmation thereof via a QR code;

however, we did not generate any revenue from this product

and the product was discontinued at the end of December 2021;

had $792,500 of loss on impairment of intangible assets related to our investment in the joint venture SOSRx, LLC formed in February

The subsidiary did not generate material revenue and in February of 2023, subsequent to the Fiscal 2022, the Company voluntarily

withdrew from the joint venture agreement.

The asset impairment is reflected in the statement of operations for the Fiscal 2022 as

impairment of intangible asset.

Additionally, the Company contributed a cash investment of $275,000 in February of 2022 when the

joint venture was formed, the Company did not recover this investment as part of the withdrawal settlement;

recorded a loss of $875,250 in connection with CSP Test Kits purchased for our Community Specialty Pharmacy that were later deemed

inappropriate for distribution by the FDA.

The Company plans to attempt to recover this amount from the vendor in 2023, however the

inventory was written down and was recorded as loss on inventory investment in the statement of operations for Fiscal 2022.

use of resources for new businesses and new products, services, and technologies, to the extent such new businesses and new products,

services, and technologies do not generate revenues or profits may take management’s focus and time away from more profitable endeavors,

may require the Company to take significant write-downs or write-offs, may take funding away from the Company’s other operations

or growth opportunities, which may ultimately be more profitable, and may have a material adverse effect on the Company’s cash

flows, liquidity and revenues, any or all of which may cause the value of the Company’s securities to decline in value or become

Relating to Our Information Systems;

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us to pay significant damages and limit our ability to operate.

on the Internet and technology industries, and other patent and trademark holders seeking to profit from royalties in connection with

grants of licenses, own large numbers of patents, copyrights, trademarks and trade secrets and frequently enter into litigation based

on allegations of infringement or other violations of intellectual property rights.

There may be intellectual property rights held by

others, including issued or pending patents and trademarks, that cover significant aspects of our technologies, content, branding or

business methods.

Any intellectual property claims against us, regardless of merit, could be time-consuming and expensive to settle or

litigate and could divert our management’s attention and other resources.

These claims also could subject us to significant liability

for damages and could result in our having to stop using technology, content, branding or business methods found to be in violation of

another party’s rights.

We might be required or may opt to seek a license for rights to intellectual property held by others, which

may not be available on commercially reasonable terms, or at all.

If we cannot license or develop technology, content, branding or business

methods for any allegedly infringing aspect of our business, we may be unable to compete effectively.

Even if a license is available,

we could be required to pay significant royalties, which could increase our operating expenses.

We may also be required to develop alternative

non-infringing technology, content, branding or business methods, which could require significant effort and expense and be inferior.

primarily conducting their business on the internet, in the technology sector, and other patent and trademark holders seeking to profit

from royalties in connection with grants of licenses, own large numbers of patents, copyrights, trademarks and trade secrets and frequently

enter into litigation based on allegations of infringement or other violations of intellectual property rights.

There may be intellectual

property rights held by others, including issued or pending patents and trademarks, that cover significant aspects of our technologies,

content, branding or business methods.

Any intellectual property claims against us, regardless of merit, could be time-consuming and

expensive to settle or litigate and could divert our management’s attention and other resources.

These claims also could subject

us to significant liability for damages and could result in our having to stop using technology, content, branding or business methods

found to be in violation of another party’s rights.

We might be required or may opt to seek a license for rights to intellectual

property held by others, which may not be available on commercially reasonable terms, or at all.

If we cannot license or develop technology,

content, branding or business methods for any allegedly infringing aspect of our business, we may be unable to compete effectively.

if a license is available, we could be required to pay significant royalties, which could increase our operating expenses.

be required to develop alternative non-infringing technology, content, branding or business methods, which could require significant

effort and expense and be inferior.

Any of these results could harm our operating results.

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While we develop and maintain systems seeking to prevent

systems-related events and security breaches from occurring, the development and maintenance of these systems is costly and requires

systems-related events and security breaches from occurring, the development and maintenance of these systems are costly and requires

ongoing monitoring and updating as technologies change and efforts to overcome security measures become more sophisticated.

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implemented without disruption to our operations.

the past, we had an incident with an email account being compromised and an attempt was made to get the us to wire outgoing money.

did not fall victim to the attempt, conducted a thorough investigation, performed cleanup procedures, and instituted additional

security measure to mitigate the risk of this incident from occurring in the future.

Risk mitigation includes the board of directors

inquiring with the information technology department on status of cyber risks management, on a quarterly basis.

the past, we had an incident with an email account being compromised and an attempt was made to get us to wire outgoing money.

did not fall victim to the attempt, conducted a thorough investigation, performed cleanup procedures, and instituted additional security

measures to mitigate the risk of this incident from occurring in the future.

Risk mitigation includes the board of directors inquiring

with the information technology department on the status of cyber risks management, on a quarterly basis.

may be losses or unauthorized access to or releases of confidential information, including personally identifiable information, that

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Failure of a customer’s system to perform in accordance with our

documentation could constitute a breach of warranty and could require us to incur additional expense in order to make the system comply

documentation could constitute a breach of warranty and could require us to incur additional expenses in order to make the system comply

with the documentation.

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effect on our business, financial condition and results of operations.

“Bonum Health” telehealth business will depend on our ability to maintain and expand a network of qualified providers.

success of our “ Bonum Health ” telehealth services is dependent upon our ability to maintain a network of qualified

telehealth providers.

If we are unable to recruit and retain board-certified physicians and other healthcare professionals, it would

have a material adverse effect on our “ Bonum Health ” business and ability to grow such operations.

We may not be willing

to pay the costs demanded by such services providers and/or changes in Medicare and/or Medicaid reimbursement levels and other pressures

on healthcare providers and consolidation activity among hospitals, physician groups and healthcare providers may make such

providers harder or more expensive to find and contract with.

The result of the above may be that our “ Bonum Health ”

telehealth services are unsuccessful, which may result in a material adverse effect to our operations.

telehealth business will depend on our ability to maintain and expand a network of qualified providers.

success of our delivery through the Bonum Health app and/or Bonum Health Hubs (the “ Bonum Health Business ”)

telehealth services is dependent upon our ability to maintain a network of qualified telehealth providers.

If we are unable to recruit

and retain board-certified physicians and other healthcare professionals, it would have a material adverse effect on our “ Bonum

Health ” Business and our ability to grow its operations.

We may not be willing to pay the costs demanded by such services providers

and/or changes in Medicare and/or Medicaid reimbursement levels and other pressures on healthcare providers and consolidation activity

among hospitals, physician groups and healthcare providers may make such providers harder or more expensive to find and contract with.

The result of the above may be that our Bonum Health Business telehealth services are unsuccessful, which may result in a material adverse

effect to our operations.

technological change in the telehealth industry presents us with significant risks and challenges.

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persons, vote of stockholders or disinterested directors or otherwise, in excess of the indemnification and advancement otherwise permitted

by Section 145 of the Delaware General Corporation Law, subject only to limits created by applicable Delaware law (statutory or non-statutory),

with respect to actions for breach of duty to the Corporation, its stockholders and others.” Our obligation to indemnify our officers

and directors may discourage stockholders from bringing a lawsuit against our officers or directors for breach of their fiduciary duty.

These provisions also may have the effect of reducing the likelihood of derivative litigation against our officers and directors, even

though such an action, if successful, might otherwise benefit us and our stockholders.

Furthermore, a stockholder’s investment

may be adversely affected to the extent we pay the costs of settlement and damage awards against our officers and directors pursuant

to these indemnification provisions.

by Section 145 of the Delaware General Corporation Law (the “ DGCL ”), subject only to limits created by applicable

Delaware law (statutory or non-statutory), with respect to actions for breach of duty to the Corporation, its stockholders and others.”

Our obligation to indemnify our officers and directors may discourage stockholders from bringing a lawsuit against our officers or directors

for breach of their fiduciary duty.

These provisions also may have the effect of reducing the likelihood of derivative litigation against

our officers and directors, even though such an action, if successful, might otherwise benefit us and our stockholders.

a stockholder’s investment may be adversely affected to the extent we pay the costs of settlement and damage awards against our

officers and directors pursuant to these indemnification provisions.

have been advised that, in the opinion of the SEC, indemnification for liabilities arising under federal securities laws is against public

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and the Company’s stockholders, including as a result of a breach of their fiduciary duties, except to the extent such exception

from liability is not permitted under Delaware General Corporation Law.

We also have contractual indemnification obligations under our

employment and engagement agreements with our executive officers and directors, as well as pursuant to indemnification agreements.

foregoing indemnification obligations could result in us incurring substantial expenditures to cover the cost of settlement or damage

awards against our directors and officers, which the Company may be unable to recoup.

These provisions and resultant costs may also discourage

us from bringing a lawsuit against our directors and officers for breaches of their fiduciary duties and may similarly discourage the

filing of derivative litigation by our stockholders against our directors and officers, even though such actions, if successful, might

otherwise benefit us and our stockholders.

from liability is not permitted under the DGCL.

We also have contractual indemnification obligations under our employment and engagement

agreements with our executive officers and directors, as well as pursuant to indemnification agreements.

The foregoing indemnification

obligations could result in us incurring substantial expenditures to cover the cost of settlement or damage awards against our directors

and officers, which the Company may be unable to recoup.

These provisions and resultant costs may also discourage us from bringing a

lawsuit against our directors and officers for breaches of their fiduciary duties and may similarly discourage the filing of derivative

litigation by our stockholders against our directors and officers, even though such actions, if successful, might otherwise benefit us

and our stockholders.

directors have the right to authorize the issuance of shares of preferred stock and additional shares of our common stock.

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provisions may impede the acquisition of the Company.

provisions of the Delaware General Corporation Law (DGCL) have anti-takeover effects and may inhibit a non-negotiated merger or other

business combination, notwithstanding the fact that our certificate of incorporation provides that we are not subject to Section 203

of Delaware General Corporation Law, which relates to certain restrictions on business combinations with interested stockholders.

provisions are intended to encourage any person interested in acquiring the Company to negotiate with, and to obtain the approval of,

our directors, in connection with such a transaction.

As a result, certain of these provisions may discourage a future acquisition of

the Company, including an acquisition in which the stockholders might otherwise receive a premium for their shares.

In addition, we can

also authorize “ blank check ” preferred stock, which could be issued by our Board of Directors without stockholder

approval and may contain voting, liquidation, dividend and other rights superior to our common stock.

provisions of the DGCL have anti-takeover effects and may inhibit a non-negotiated merger or other business combination, notwithstanding

the fact that our certificate of incorporation provides that we are not subject to Section 203 of the DGCL, which relates to certain

restrictions on business combinations with interested stockholders.

These provisions are intended to encourage any person interested

in acquiring the Company to negotiate with, and to obtain the approval of, our directors, in connection with such a transaction.

result, certain of these provisions may discourage a future acquisition of the Company, including an acquisition in which the stockholders

might otherwise receive a premium for their shares.

In addition, we can also authorize “ blank check ” preferred stock,

which could be issued by our Board of Directors without stockholder approval and may contain voting, liquidation, dividend and other

rights superior to our common stock.

Reporting and Listing Risks

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common stock was approved for listing on The NASDAQ Capital Market under the symbol “ MEDS ”, in February 2020.

Notwithstanding

such listing, there can be no assurance any broker will be interested in trading our stock.

Therefore, it may be difficult to sell your

shares of common stock if you desire or need to sell them.

Our underwriters are not obligated to make a market in our securities, and

even if they do make a market, they can discontinue market making at any time without notice.

Neither we nor the underwriters can provide

any assurance that an active and liquid trading market in our securities will develop or, if developed, that such market will continue.

Notwithstanding such listing, there can be no assurance any broker will be interested in trading our stock.

Therefore, it may be

difficult to sell your shares of common stock if you desire or need to sell them.

Our underwriters are not obligated to make a

market in our securities, and even if they do make a market, they can discontinue market-making at any time without notice.

we nor the underwriters can provide any assurance that an active and liquid trading market in our securities will develop or, if

developed, that such a market will continue.

is also no guarantee that we will be able to maintain our listing on The NASDAQ Capital Market for any period of time by perpetually

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national securities exchange or obtain quotation on an over-the counter quotation system.

July 29, 2022, the Listing Qualifications department of The Nasdaq Stock Market LLC (the “ Staff ”) notified the Company

that it did not comply with the minimum $2,500,000 stockholders’ equity requirement for continued listing set forth in Nasdaq Listing

Rule 5550(b) (the “ Rule ”);

however, the Staff on October 17, 2022, granted the Company’s request for an extension

until January 25, 2023, to comply with this requirement.

January 30, 2023, the Company received a delist determination letter from the Staff advising the Company that the Staff had determined

that the Company did not meet the terms of the extension.

Specifically, the Company did not complete its proposed transactions and was

unable to file a Current Report Form 8-K by the January 25, 2023 deadline previously required by the Staff, evidencing compliance with

a result, on February 6, 2023, the Company submitted a hearing request to the Nasdaq Hearings Panel (the “ Panel ”),

which request will stay any delisting action by the Staff at least until the hearing process concludes and any extension granted by the

Panel expires.

the Panel hearing, the Company intends to present a plan to regain compliance with the minimum stockholders’ equity requirement.

In the interim, the Company’s common stock will continue to trade on Nasdaq under the symbol “ MEDS ” at least

pending the ultimate conclusion of the hearing process.

can be no assurance that the Company’s plan will be accepted by the Panel or that, if it is, the Company will be able to regain

compliance with the applicable Nasdaq listing requirements.

If the Company’s common stock is delisted, it could be more difficult

to buy or sell the Company’s common stock or to obtain accurate quotations, and the price of the Company’s common stock could

suffer a material decline.

Delisting could also impair the Company’s ability to raise capital.

are currently prohibited from filing any new registration statements on Form S-3 and effective upon the date that our Annual Report on

Form 10-K for the year ended December 31, 2022 is filed with the Commission, we will be prohibited from using our Shelf Form S-3 until

at least October 2023.

to our inadvertent failure to timely file a Current Report on Form 8-K, we are currently prohibited from using Form S-3 to register securities

with the Commission.

Separately, effective on the date that we file our Annual Report on Form 10-K for Fiscal 2022, our ability to use

our previously effective shelf Form S-3, will be suspended until at least October 2023.

As a result, we will be required to use Form

S-1, a longer-form registration statement for future offerings, and will be prohibited, after the date this report is filed, until at

least October 2023, from undertaking at-the-market offerings.

Furthermore, in the event that the Pre-Funded Warrants have not been exercised

in full by such date, the shares of common stock issuable upon exercise of the Pre-Funded Warrants will need to be registered on Form

S-1 in order to continue to be registered under the Securities Act.

changes that affect our distribution channels could harm our business.

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distribute generic pharmaceuticals, which can be subject to both price deflation and price inflation.

Continued volatility

in the availability, pricing trends or reimbursement of these generic drugs, or significant fluctuations in the nature, frequency and

Continued volatility in the

availability, pricing trends or reimbursement of these generic drugs, or significant fluctuations in the nature, frequency and

magnitude of generic pharmaceutical launches, could have a material adverse impact on our results of operations.

Additionally, any future

changes in branded and generics drug pricing could be significantly different than our projections.

Generic drug manufacturers are increasingly

challenging the validity or enforceability of patents on branded pharmaceutical products.

During the pendency of these legal challenges,

a generics manufacturer may begin manufacturing and selling a generic version of the branded product prior to the final resolution of

its legal challenge over the branded product’s patent.

To the extent we source, contract manufacture, and distribute such generic

products, the brand-name company could assert infringement claims against us.

While we generally obtain indemnification against such

claims from generic manufacturers as a condition of distributing their products, these rights may not be adequate or sufficient to protect

Additionally, any

future changes in branded and generic drug pricing could be significantly different than our projections.

Generic drug manufacturers

are increasingly challenging the validity or enforceability of patents on branded pharmaceutical products.

During the pendency of

these legal challenges, a generic drugs manufacturer may begin manufacturing and selling a generic version of the branded product

prior to the final resolution of its legal challenge over the branded product’s patent.

To the extent we source, contract

manufacture, and distribute such generic products, the brand-name company could assert infringement claims against us.

generally obtain indemnification against such claims from generic manufacturers as a condition of distributing their products, these

rights may not be adequate or sufficient to protect us.

are also required to comply with various state pricing gouging laws.

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We cannot predict what alternative or additional deficit reduction initiatives or Medicare payment reductions, if any, will

ultimately be enacted into law, or the timing or affect any such initiatives or reductions would have on us.

ultimately be enacted into law, or the timing or effect any such initiatives or reductions would have on us.

Any of the changes discussed

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modifications from time to time.

We might be adversely

impacted by healthcare reform such as changes in pricing and reimbursement models.

Many of our products and services

are designed and intended to function within the structure of current healthcare financing and reimbursement systems.

The healthcare

industry and related government programs are changing.

Some of these changes increase our risks and create uncertainties for our business.

For example, some changes

in reimbursement methodologies (including government rates) for pharmaceuticals, medical treatments and related service reduces profit

margins for us and our customers and impose new legal requirements on healthcare providers.

Those changes have included cuts in Medicare

and Medicaid reimbursement levels, changes in the basis for payments, shifting away from fee-for-service and toward value-based payment

and risk-sharing models, and increases in the use of managed care.

In the U.S., the Patient Protection and Affordable

Care Act (“ACA”) significantly expanded health insurance covered to uninsured Americans and changed the way healthcare is

financed by both governmental and private payers.

There are continued efforts to challenge the ACA.

There are also efforts to broaden

healthcare coverage.

lawmakers also have explored proposals to reduce drug prices, including requiring price transparency and drug

importation measures.

These proposals might result in significant changes in the pharmaceutical value chain as manufacturers, PBM, managed

care organizations and other industry stakeholders look to implement new transactional flows and adapt their business models.

Provincial governments in

Canada that provide partial funding for the purchase of pharmaceuticals and independently regulate the sale and reimbursement of drugs

have sought to reduce the costs of publicly funded health programs.

For example, provincial governments have taken steps to reduce consumer

prices for generic pharmaceuticals and, in some provinces, change professional allowances paid to pharmacists by generic manufacturers.

Many European governments

provide or subsidize healthcare to consumers and regulate pharmaceutical prices, patient eligibility and reimbursement levels in order

to control government healthcare system costs.

Some European governments have implemented or are considering austerity measures to reduce

healthcare spending.

These measures exert pressure on the pricing and reimbursement timelines for pharmaceuticals and may cause our customers

to purchase fewer of our products and services or influence us to reduce prices.

might be adversely impacted by healthcare reform such as changes in pricing and reimbursement models.

of our products and services are designed and intended to function within the structure of current healthcare financing and reimbursement

The healthcare industry and related government programs are changing.

Some of these changes increase our risks and create uncertainties

for our business.

example, some changes in reimbursement methodologies (including government rates) for pharmaceuticals, medical treatments and related

service reduces profit margins for us and our customers and impose new legal requirements on healthcare providers.

Those changes have

included cuts in Medicare and Medicaid reimbursement levels, changes in the basis for payments, shifting away from fee-for-service and

toward value-based payment and risk-sharing models, and increases in the use of managed care.

the U.S., the Patient Protection and Affordable Care Act (“ACA”) significantly expanded health insurance coverage to uninsured

Americans and changed the way healthcare is financed by both governmental and private payers.

There are continued efforts to challenge

There are also efforts to broaden healthcare coverage.

lawmakers also have explored proposals to reduce drug prices, including

requiring price transparency and drug importation measures.

These proposals might result in significant changes in the pharmaceutical

value chain as manufacturers, PBM, managed care organizations and other industry stakeholders look to implement new transactional flows

and adapt their business models.

governments in Canada that provide partial funding for the purchase of pharmaceuticals and independently regulate the sale and reimbursement

of drugs have sought to reduce the costs of publicly funded health programs.

For example, provincial governments have taken steps to

reduce consumer prices for generic pharmaceuticals and, in some provinces, change professional allowances paid to pharmacists by generic

manufacturers.

European governments provide or subsidize healthcare to consumers and regulate pharmaceutical prices, patient eligibility and reimbursement

levels in order to control government healthcare system costs.

Some European governments have implemented or are considering austerity

measures to reduce healthcare spending.

These measures exert pressure on the pricing and reimbursement timelines for pharmaceuticals

and may cause our customers to purchase fewer of our products and services or influence us to reduce prices.

billing and coding laws may subject us to fines and investigations.

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the enactment of new rules and regulations could adversely affect our business.

Depending on future

enforcement or additional rules and regulations created around it, pharmaceutical pricing controls could be established resulting in

substantially reduced margins and limited reimbursement for pharmacies and all other healthcare provider bases.

In turn, this may adversely

affect our cash flow, profitability, and growth.

Depending on future enforcement or additional rules and

regulations created around it, pharmaceutical pricing controls could be established, resulting in substantially reduced margins and limited

reimbursement for pharmacies and all other healthcare provider bases.

In turn, this may adversely affect our cash flow, profitability,

Relating to Our Industry in General

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As reported under “ Item 9A.

Controls and Procedures ”, as of December 31, 2021, our CEO and

CFO have determined that our disclosure controls and procedures were not effective.

Additionally, our management is responsible for establishing

and maintaining adequate internal control over our financial reporting, as defined in Rule 13a-15(f) under the Exchange Act.

below under “ Item 9A.

Controls and Procedures ”, based on reviews conducted by management, we have concluded that a material

weakness exists in the Company’s internal controls over financial reporting.

A material weakness is a deficiency, or a combination

of deficiencies, in internal controls over financial reporting such that there is a reasonable possibility that a material misstatement

of our annual or interim financial statements will not be prevented or detected on a timely basis.

Such internal control over financial

reporting and disclosure controls and procedures have been ineffective since approximately June 30, 2014 and December 31, 2015, respectively.

Controls and Procedures ”, as of December 31, 2022, our

CEO and CFO have determined that our disclosure controls and procedures were not effective.

Additionally, our management is responsible

for establishing and maintaining adequate internal control over our financial reporting, as defined in Rule 13a-15(f) under the Exchange

As disclosed below under “ Item 9A.

Controls and Procedures ”, based on reviews conducted by management, we have

concluded that a material weakness exists and has existed since approximately 2014 in the Company’s internal controls over financial

A material weakness is a deficiency, or a combination of deficiencies, in internal controls over financial reporting such

that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented

or detected on a timely basis.

material weaknesses identified in our controls and procedures as of December 31, 2022, included the fact that (1) The Company did not

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reliable financial statements and the Company is committed to remediating its material weaknesses in such controls as promptly as possible.

Company has identified certain remediation actions and is in the process of implementing them, but such efforts are not complete and

remain ongoing.

If we do not complete our remediation in a timely manner or if our remedial measures are insufficient to address the

material weaknesses, or if additional material weaknesses in our internal controls and/or controls and procedures are discovered or occur

in the future, it may materially adversely affect our ability to report our financial condition and results of operations in a timely

and accurate manner and there will continue to be an increased risk of future misstatements.

Although we regularly review and evaluate

internal controls systems to allow management to report on the effectiveness of our internal controls over financial reporting and controls

and procedures, we may discover additional weaknesses in our internal controls over financial reporting or disclosure controls and procedures.

The next time we evaluate our internal controls over financial reporting and disclosure controls and procedures, if we identify one or

more new material weaknesses or have been unable to timely remediate our existing material weaknesses, we would be unable to conclude

that our internal controls over financial reporting or disclosure controls and procedures are effective.

If we are unable in the future

to conclude that our internal controls over financial reporting or our disclosure controls and procedures are effective, we may not be

able to report our financial condition and results of operations in a timely and accurate manner, which could have a material adverse

effect on our business, financial condition, cash flows and results of operations and could cause the market value of our shares of common

stock to decline.

In addition, any potential future restatements could subject us to additional adverse consequences, including sanctions

by the SEC, stockholder litigation and other adverse actions.

Moreover, we may be the subject of further negative publicity focusing

on such financial statement adjustments and resulting restatement and negative reactions from our stockholders, creditors or others with

whom we do business.

The occurrence of any of the foregoing could have a material adverse effect on our business, financial condition,

Fiscal 2014 when the material weakness became effective, the Company has identified certain remediation actions and has implemented or

is in the process of implementing them, many efforts are not complete and remain in process.

If we do not complete our remediation in

a timely manner or if our remedial measures are insufficient to address the material weaknesses, or if additional material weaknesses

in our internal controls and/or controls and procedures are discovered or occur in the future, it may materially adversely affect our

ability to report our financial condition and results of operations in a timely and accurate manner and there will continue to be an

increased risk of future misstatements.

Although we regularly review and evaluate internal controls systems to allow management to report

on the effectiveness of our internal controls over financial reporting and controls and procedures, we may discover additional weaknesses

in our internal controls over financial reporting or disclosure controls and procedures.

The next time we evaluate our internal controls

over financial reporting and disclosure controls and procedures, if we identify one or more new material weaknesses or have been unable

to timely remediate our existing material weaknesses, we would be unable to conclude that our internal controls over financial reporting

or disclosure controls and procedures are effective.

If we are unable in the future to conclude that our internal controls over

financial reporting or our disclosure controls and procedures are effective, we may not be able to report our financial condition and

results of operations in a timely and accurate manner, which could have a material adverse effect on our business, financial condition,

cash flows and results of operations and could cause the market value of our shares of common stock to decline.

may experience adverse impacts on our reported results of operations as a result of adopting new accounting

standards or interpretations.

In addition, any potential

future restatements could subject us to additional adverse consequences, including sanctions by the SEC, stockholder litigation and other

adverse actions.

Moreover, we may be the subject of further negative publicity focusing on such financial statement adjustments and resulting

restatement and negative reactions from our stockholders, creditors or others with whom we do business.

The occurrence of any of the

foregoing could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause

the market value of our shares of common stock to decline.

may experience adverse impacts on our reported results of operations as a result of adopting new accounting standards or interpretations.

implementation of and compliance with changes in accounting rules, including new accounting rules and interpretations, have not affected

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wholesalers, and if we were to lose any of those customers or suppliers, our results of operations would be adversely affected .

the years ended December 31, 2021 and 2020, no sales to customers represented greater than 10% of revenue in 2021 and sales to two customers

represented 25% and 15% of revenue, respectively, in 2020.

In the event our customers do not pay us amounts owed, sales to

such customers cease or we are unable to find new customers moving forward, it could have a materially adverse effect on our results

of operations.

Fiscal 2022 and Fiscal 2021, no sales to customers represented greater than 10% of revenue.

In the event our customers do not pay us

amounts owed, sales to such customers cease or we are unable to find new customers moving forward, it could have a materially adverse

effect on our results of operations.

We have a working relationship with over 25 wholesalers and the nation’s largest buying group.

Although we believe

those entities are satisfied with their business relationship with Trxade, if our buying group and two or three of the largest wholesalers

decided no longer to do business with Trxade, and we were unable to find additional entities to step into their shoes, the resulting

supplier void would materially and adversely affect our competitiveness in the marketplace, and could cause a material adverse effect

on our results of operations.

Although we believe those entities are satisfied with their business relationship with Trxade, if our buying group and two or three of

the largest wholesalers decided no longer to do business with Trxade, and we were unable to find additional entities to step into their

shoes, the resulting supplier void would materially and adversely affect our competitiveness in the marketplace, and could cause a material

adverse effect on our results of operations.

might be harmed by changes in our relationships or contracts with suppliers .

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agreement to the transaction.

November 29, 2022, the Company received written notice (the “Notification Letter”) from Nasdaq notifying the Company that

it is not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for continued listing on

The Nasdaq Capital Market.

Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid price of $1.00 per share,

and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists if the deficiency continues for

a period of thirty (30) consecutive business days.

Based on the closing bid price of the Company’s common stock for the thirty

(30) consecutive business days from October 14, 2022 to November 28, 2022, the Company no longer meets the minimum bid price requirement.

Notification Letter does not impact the Company’s listing of its common stock on the Nasdaq Capital Market at this time.

The Notification

Letter states that the Company has 180 calendar days or until May 29, 2023, to regain compliance with Nasdaq Listing Rule 5550(a)(2).

To regain compliance, the bid price of the Company’s common stock must have a closing bid price of at least $1.00 per share for

a minimum of 10 consecutive business days.

If the Company does not regain compliance by May 29, 2023, an additional 180 days may be granted

to regain compliance, so long as the Company meets The Nasdaq Capital Market initial listing criteria (except for the bid price requirement)

and notifies Nasdaq in writing of its intention to cure the deficiency during the second compliance period by effecting a reverse stock

split, if necessary.

If the Company does not qualify for the second compliance period or fails to regain compliance during the second

180-day period, the Company’s common stock will be subject to delisting, at which point the Company would have an opportunity to

appeal the delisting determination to a Hearings Panel.

Company intends to monitor the closing bid price of its common stock and may, if appropriate, consider implementing available options

to regain compliance with the minimum bid price requirement under the Nasdaq Listing Rules.

remedies available to an investor in “ penny stocks ” may include the following:

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ever, our common stock will not be classified as a “ penny stock ” in the future.

stocks are generally considered to be high-risk investments.

There are several factors that contribute to the high-risk nature of penny

stocks, including:

are known for their extreme price fluctuations.

This volatility can be caused by a number of factors, including changes in the overall

stock market, news about the company or industry, and changes in investor sentiment.

Lack of liquidity:

stocks are often traded on over-the-counter markets, which can make them more difficult to buy and sell.

This lack of liquidity can

increase the risk of large price swings and can make it difficult to exit a position if needed.

Lack of information:

penny stock companies are not required to file regular reports with the Securities and Exchange Commission (SEC), which means there

may be limited information available to investors.

This can make it difficult to evaluate the financial health of the company and

to make informed investment decisions.

Manipulation:

their low trading volumes and lack of regulatory oversight, penny stocks can be vulnerable to market manipulation.

This can include

practices such as “pump and dump” schemes, where investors artificially inflate the price of a stock before selling their

shares for a profit.

it’s important to approach penny stocks with caution and to thoroughly research any investment before making a decision.

also a good idea to diversify your portfolio and to limit your exposure to any one stock or sector.

significant number of our shares are eligible for sale and their sale or potential sale may depress the market price of our common stock.

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existing stockholders.

of the date of this Report, we had 8,181,041 shares of our common stock issued and outstanding and the following securities,

which are exercisable into shares of our common stock:

44,535 shares of our common stock issuable upon the exercise of warrants with exercise prices ranging from $0.06 to $9.00 per share,

with a weighted average price of $0.32;

of the date of this Report, we had 10,110,978 shares of our common stock issued and outstanding and the following securities, which are

exercisable into shares of our common stock:

26,924 shares of our common stock issuable upon the exercise of warrants with a weighted-average exercise price of $0.06;

257,506 shares of our common stock issuable upon the exercise of options with exercise prices ranging from $2.46 per share to $9.60 per

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of our actual operating performance.

Chief Executive Officer and President are our two largest stockholders and, as a result, they can exert control over us and have actual

or potential interests that may differ from yours.

Chief Executive Officer and President are two of our largest stockholders and, as a result, they can exert influence over us and have

actual or potential interests that may differ from yours.

Suren Ajjarapu, our CEO, and Mr.

Prashant Patel, our President, beneficially own, in the aggregate, over 53% of our

common stock.

As a result, these stockholders, acting together, will be able to influence many matters requiring stockholder approval,

including the election of directors and approval of mergers and other significant corporate transactions.

This concentration of ownership

may have the effect of delaying, preventing or deterring a change in control, and could deprive our stockholders of an opportunity to

receive a premium for their shares of common stock as part of a sale of our company and may affect the market price of our stock.

Prashant Patel, our President, beneficially own, in the aggregate, over 47% of our common stock.

As a result, these stockholders, acting together, will be able to influence many matters requiring stockholder approval, including the

election of directors and approval of mergers and other significant corporate transactions.

This concentration of ownership may have

the effect of delaying, preventing or deterring a change in control, and could deprive our stockholders of an opportunity to receive

a premium for their shares of common stock as part of a sale of our company and may affect the market price of our stock.

Ajjarapu and Mr.

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as a stockholder, which could adversely affect our results of operations and the trading price of our common stock.

this control, Mr.

this influence, Mr.

Ajjarapu and Mr.

Patel can control our management, affairs and all matters requiring stockholder approval, including

Patel can influence our management, affairs and all matters requiring stockholder approval, including

the approval of significant corporate transactions, a sale of our company, decisions about our capital structure and the composition

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investor confidence.

election not to opt out of the JOBS Act extended accounting transition period may not make our financial statements easily comparable

to other companies.

election not to opt out of the JOBS Act extended accounting transition period may create difficulty in comparing our financial statements

to the financial statements of other companies.

to the JOBS Act, as an “ emerging growth company ”, we can elect to opt out of the extended transition period for any

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the above, we are also currently a “ smaller reporting company ”, meaning that we are not an investment company, an

asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and have a public float

asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and has a public float

of less than $700 million and less than $100 million annual revenues or a public float of less than $250 million, during the most recently

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analyze the Company’s results of operations and financial prospects.

have been, and may in the future be, adversely affected by the global COVID-19 pandemic, the duration and economic, governmental and

social impact of which is difficult to predict, which may significantly harm our business, prospects, financial condition and operating

2020 and continuing into 2023, there has been a widespread worldwide impact from the COVID-19 pandemic, and we have been, and may in

the future be, adversely affected as a result.

The outbreak of the COVID-19 coronavirus, the global response to such coronavirus, including

travel restrictions and quarantines that governments instituted during 2020 and 2021, adversely affected our operations, and future restrictions

or governmental requirements may have an adverse effect on our operations in the future, and/or may have a significant negative impact

on our results of operations, the production of pharmaceuticals and our ability to timely obtain pharmaceuticals for resale.

we are experiencing reductions to, and interruptions in, the delivery of supply chain pharmaceuticals that are having a negative impact

on our wholesalers and certain technology outsourcing in India and the Philippines and we are also having a hard time finding qualified

staff, due to the pandemic.

Notwithstanding the above disruptions, our results of operations have not, to date, been materially

adversely affected by the pandemic.

However, if we continue to experience production difficulties, quality control problems or further

shortages in supply of pharmaceuticals or personnel in the future, this could harm our business and results of operations, any of which

could have a material adverse effect on our operations and the value of our securities.

In addition, employee sicknesses and remote working

environments, and the potential negative effect thereof on productivity and internal controls, related to the coronavirus and the federal,

state and local responses to such virus, could materially impact our consolidated results for the year 2022 and beyond.

outbreak could also restrict our access to capital such as credit facilities and lead to material nonrecurring charges, write-downs,

impairments and expenses.

The Company is actively and continually monitoring the pandemic’s effect on our businesses and endeavoring

to adapt quickly in real time to meet the rapidly changing demands of our Customers and Suppliers.

mitigate the spread of COVID-19, we implemented sanitation and personal protection measures.

The Company’s corporate office reopened

on January 3, 2022, in accordance to Center for Disease Control and Prevention (CDC) guidance, allowing only management and certain key

operational employees to return to the office, while hourly employees remain working remotely until further notice.

measures might not fully mitigate COVID-19 risks to our workforce, and we could experience unusual levels of absenteeism that might impair

operations and delay delivery of products.

The COVID-19 pandemic affects product manufacturing, supply and transport availability and

The pandemic has in the past reduced demand for some products due to delays or cancellations of elective medical procedures, consumer

self-isolation and business closures, among other reasons, which may become issues again in the future if the number of persons infected

does not continue to decline.

The COVID-19 pandemic also influences shortages of some products, with product allocation resulting in

delivery delays for customers.

Additionally, as a result of the coronavirus outbreak, various states have adopted price gouging laws.

Our failure to comply with such laws and regulations could subject us to claims, penalties, fines or lawsuits.