What changed in this filing

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Item 1. Financial Statements

2020-08-19 compared with 2020-07-06 · 413 added, 340 removed, 374 unchanged (67% of the section changed)

Financial Statements

consolidated financial statements included in this Form 10-Q are as follows:

F-1 Consolidated Balance Sheets as of March 31, 2020 and December 31, 2019 (unaudited);

F-2 Consolidated Statements of Operations for the three months ended March 31, 2020 and March 31,

2019 (unaudited);

F-3 Consolidated Statements of Stockholders’

Deficit for the three

months ended March 31, 2020 and 2019 (unaudited);

F-4 Consolidated Statements of Cash Flow for the three months ended

March 31, 2020 and 2019 (unaudited);

F-5 Notes to Consolidated Financial Statements.

consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United

States of America for interim financial information and the SEC instructions to Form 10-Q.

In the opinion of management, all adjustments

considered necessary for a fair presentation have been included.

Operating results for the interim period ended March 31, 2020

are not necessarily indicative of the results that can be expected for the full year.

CONSOLIDATED BALANCE SHEETS

Our consolidated financial statements included in this Form 10-Q

are as follows:

Consolidated Balance Sheets as of June 30, 2020 and December 31, 2019 (unaudited);

Consolidated Statements of Operations for the three and six months ended June 30, 2020 and 2019 (unaudited);

Consolidated Statements of Stockholders’

Deficit for the three and six months ended June 30, 2020 and 2019 (unaudited);

Consolidated Statements of Cash Flow for the three and six months ended June 30, 2020 and 2019 (unaudited);

Notes to Consolidated Financial Statements.

These consolidated financial statements have been prepared in accordance

with accounting principles generally accepted in the United States of America for interim financial information and the SEC instructions

to Form 10-Q.

In the opinion of management, all adjustments considered necessary for a fair presentation have been included.

results for the interim period ended June 30, 2020 are not necessarily indicative of the results that can be expected for the full

SKINVISIBLE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

Current assets

receivable (including $4,370 and nil, from related parties respectively)

expense and other current assets

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current liabilities

notes payable related party, less current maturities, net of unamortized discount of $2,908,507 and $3,060,970 respectively

notes payable, less current maturities, net of unamortized debt discount of $241,776 and $254,450, respectively

Total liabilities

notes payable related party, net of unamortized discount of $2,756,044 and $3,060,970 respectively

notes payable, net of unamortized debt discount of $229,102 and $254,450, respectively

Stockholders' deficit

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200,000,000 shares authorized;

4,471,746 and 4,471,746 shares issued and outstanding at March 31, 2020 and December

4,471,746 and 4,471,746 shares issued and outstanding at June 30, 2020 and December

31, 2019, respectively

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liabilities and stockholders' deficit

Accompanying Notes to Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF OPERATIONS

(including $7,643 with a related party)

See Accompanying Notes to Consolidated

Financial Statements.

SKINVISIBLE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

- related party

Cost of revenues

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income - related party

other expense

loss per common share

on extinguishment of debt

other expenses

Basic loss per

diluted loss per common share

Basic weighted

average common shares outstanding

Fully diluted

weighted average common shares outstanding

Accompanying Notes to Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

diluted weighted average common shares outstanding

See Accompanying Notes to Consolidated Financial

SKINVISIBLE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

the Three and Six months Ended June 30, 2020

Paid-in Capital

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$ (3,437,251)

June 30, 2020

$ (33,995,673 )

$ (3,750,044)

the Three and Six months Ended June 30, 2019

Additional Paid-in

Stockholders' Deficit

December 31, 2018

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$ (5,062,514)

Accompanying Notes to Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Settlement of debts

Beneficial conversion

feature on convertible notes issued as settlement on existing payables

Beneficial conversion

feature repurchase

June 30, 2019

$ (32,476,775 )

$ (2,231,146)

See Accompanying

Notes to Consolidated Financial Statements.

CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS

Cash flows from operating

to reconcile net loss to net cash used in operating activities

to reconcile net loss to net

provided (used) by operating activities:

and amortization

of debt discount

on extinguishment of debt

in operating assets and liabilities:

in prepaid assets

(Increase) in prepaid assets

in accounts receivable

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in accrued interest

cash used in operating activities

cash provided (used) by operating activities

Cash flows from investing

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Cash flows from financing

from related party loans, net of payments

on related party loans

from related party loans

cash provided by financing activities

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investing and financing activities:

conversion feature on convertible debt

stock issued on extinguishment of debts

Accompanying Notes to Consolidated Financial Statements.

See Accompanying

Notes to Consolidated Financial Statements.

NOTES TO CONSOLIDATED

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of business –

Skinvisible, Inc., (referred to as the “Company”) is focused on the development and manufacture

Skinvisible, Inc., (referred to as the “Company”) is focused on the development, manufacture

and sales of innovative topical, transdermal and mucosal polymer-based delivery system technologies and formulations incorporating

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Additionally,

the Company’s non-dermatological formulations, offer solutions for a broad spectrum of markets women’s health, pain

management, and others.

the Company’s non-dermatological formulations offer solutions for a broad spectrum of markets including women’s health,

pain management, and others.

The Company maintains executive and sales offices in Las Vegas, Nevada.

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26, 2017, the Company purchased 5,750,000 shares of common stock of Ovation Science Inc.

(“Ovation”) for $32,286 which

at the time of purchase the Company represented 99.9% of the then issued and outstanding common stock.

On March 28, 2018 the Company

sold its interest in Ovation to officers of the Company for $500,000 which at the time represented a 37.80% interest in Ovation.

(“Ovation”) for $32,286,

which at the time of purchase the Company’s ownership represented 99.9% of the then issued and outstanding common stock.

On March 28, 2018 the Company sold its interest in Ovation to officers of the Company for $500,000 which at the time represented

a 37.80% interest in Ovation.

Inc., together with its subsidiaries, shall herein be collectively referred to as the “Company.”

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since its inception and requires capital for its contemplated operational and marketing activities to take place.

These factors, among

others, raises substantial doubt about the Company’s ability to continue as a going concern.

plans for the Company are to generate the necessary funding through licensing of its core

products and to seek additional debt and equity funding.

However, the Company’s ability to generate the necessary

funds through licensing or raise additional capital through the future issuances of common stock or debt is unknown.

The obtainment

of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition,

ultimately, to the attainment of profitable operations are necessary for the Company to continue operations.

The consolidated financial

statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

Company's operations and business have experienced disruption due to the unprecedented conditions surrounding the COVID-19 pandemic

spreading throughout the United States and elsewhere.

The spread of COVID-19 has caused a change in the availability of our staff

and support services.

Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial

The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments

or a revision of the carrying value of its assets or liabilities as of the date of issuance of this Quarterly Report on Form 10-Q.

These factors,

among others, raises substantial doubt about the Company’s ability to continue as a going concern.

Managements plans for

the Company are to generate the necessary funding through licensing of its core products

and to seek additional debt and equity funding.

However, the Company’s ability to generate the necessary funds through

licensing or raise additional capital through the future issuances of common stock or debt is unknown.

The obtainment of additional

financing, the successful development of the Company’s contemplated plan of operations, and its transition, ultimately,

to the attainment of profitable operations are necessary for the Company to continue operations.

The consolidated financial statements

of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties.

The Company's

operations and business have experienced disruption due to the unprecedented conditions surrounding the COVID-19 pandemic spreading

throughout the United States and elsewhere.

The spread of COVID-19 has caused a change in the availability of our staff and support

Due to the COVID-19 pandemic, there has been uncertainty and disruption in the global economy and financial markets.

The Company is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a

revision of the carrying value of its assets or liabilities as of the date of issuance of this Quarterly Report on Form 10-Q.

These estimates could change in the future, as new events occur, or additional information is obtained.

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There are $35,089 and $1,298

in cash as of March 31, 2020 and December 31, 2019 respectively.

in cash as of June 30, 2020 and December 31, 2019 respectively.

of financial instruments –The carrying value of cash, accounts payable and accrued expenses, and debt (See Notes 6 &

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and the last unobservable.

1 Quoted prices in active markets for identical assets or liabilities.

These are typically obtained from real-time quotes

for transactions in active exchange markets involving identical assets.

The Company uses Level 1 measurements to value the

transactions when it issues shares, warrants, options and debt with beneficial conversion features.

Level 1 Quoted prices

in active markets for identical assets or liabilities.

These are typically obtained from real-time quotes for transactions

in active exchange markets involving identical assets.

The Company uses Level 1 measurements to value the transactions when

it issues shares, warrants, options and debt with beneficial conversion features.

Level 2 Quoted prices

for similar assets and liabilities in active markets;

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in the periods included in these financial statements.

Revenue recognition

We recognize revenue in accordance with generally accepted accounting principles as outlined in the Financial Accounting

Standard Board's (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts with Customers,

which requires that five steps be followed in evaluating revenue recognition:

(i) identify the contract with the customer;

identity the performance obligations in the contract;

recognition –

We recognize revenue in accordance with generally accepted accounting principles as outlined in the Financial

Accounting Standard Board's (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts

with Customers, which requires that five steps be followed in evaluating revenue recognition:

(i) identify the contract with the

(ii) identity the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price;

(iv) allocate the

transaction price;

and (v) recognize revenue when or as the entity satisfied a performance obligation.

31, 2020 and March 31, 2019, the Company had $8,409 and $10,204, respectively, in receivables related to royalty contracts.

sales –

Revenues from the sale of products (Invisicare®

polymers) are recognized when title to the products

are transferred to the customer and only when no further contingencies or material performance obligations are warranted, and

thereby have earned the right to receive reasonably assured payments for products sold and delivered.

sales –

We also recognize royalty revenue from licensing our patented product formulations only when earned, with

no further contingencies or material performance obligations are warranted, and thereby have earned the right to receive and retain

reasonably assured payments.

and license rights sales –

We also recognize revenue from distribution and license rights when no further contingencies

or material performance obligations are warranted, and thereby have earned the right to receive and retain reasonably assured

has made an accounting policy election to exclude from the measurement of the transaction price all taxes assessed by governmental

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requiring payment within 30 days from the invoice date.

The carrying amount of accounts receivable is reviewed periodically

for collectability.

If management determines that collection is unlikely, an allowance that reflects management’s best

estimate of the amounts that will not be collected is recorded.

Management reviews each accounts receivable balance that

exceeds 30 days from the invoice date and, based on an assessment of creditworthiness, estimates the portion, if any, of the

balance that will not be collected.

As of March 31, 2020 and December 31, 2019, the Company had not recorded a reserve for

doubtful accounts.

The carrying amount of accounts receivable is reviewed periodically for

collectability.

If management determines that collection is unlikely, an allowance that reflects management’s best estimate

of the amounts that will not be collected is recorded.

Management reviews each accounts receivable balance that exceeds 30 days

from the invoice date and, based on an assessment of creditworthiness, estimates the portion, if any, of the balance that will

not be collected.

As of June 30, 2020 and December 31, 2019, the Company had not recorded a reserve for doubtful accounts.

assets –

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The Company reports earnings (loss) per share in accordance with FASB Codification Topic ASC 260-10

260-10 “Earnings Per Share”, Basic earnings (loss) per share is computed by dividing income (loss) available to

common shareholders by the weighted average number of common shares available.

Diluted earnings (loss) per share is computed

similar to basic earnings (loss) per share except that the denominator is increased to include the number of additional

common shares that would have been outstanding if the potential common shares had been issued and if the additional common

shares were dilutive.

Diluted earnings (loss) per share has not been presented for the three months ending March 31, 2020

since the effect of the assumed exercise of options and warrants to purchase common shares (common stock equivalents) would

have an anti-dilutive effect.

There are 26,147,998 additional shares issuable in connection with outstanding options,

warrants, stock payable and convertible debts as of March 31, 2020.

“Earnings Per Share”, Basic earnings (loss) per share is computed by dividing income (loss) available to common shareholders

by the weighted average number of common shares available.

Diluted earnings (loss) per share is computed similar to basic earnings

(loss) per share except that the denominator is increased to include the number of additional common shares that would have been

outstanding if the potential common shares had been issued and if the additional common shares were dilutive.

Diluted earnings

(loss) per share has not been presented for the three and six months ending June 30, 2020 since the effect of the assumed exercise

of options and warrants to purchase common shares (common stock equivalents) would have an anti-dilutive effect.

There are 27,163,307

additional shares issuable in connection with outstanding options, warrants, stock payable and convertible debts as of June 30,

The shares issuable under each instrument is as follows;

100,000 shares issuable for options, 60,000 shares issuable for warrants, 59,602 shares issuable for shares payable and

25,928,396 shares issuable under convertible notes.

100,000 shares issuable for options, 60,000 shares issuable for

warrants, 59,602 shares issuable for shares payable and 26,943,705 shares issuable under convertible notes.

There were 25,931,481

additional shares issuable in connection with outstanding options, warrants, stock payable and convertible debts as of March 31,

additional shares issuable in connection with outstanding options, warrants, stock payable and convertible debts as of June 30,

The shares which were issuable at that date under each instrument were as follows;

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and trademarks and other intangible assets are capitalized at their historical cost and are amortized over their estimated useful

As of March 31, 2020 intangible assets total $699,670, net of $543,135 of accumulated amortization.

As of June 30, 2020 intangible assets total $713,473, net of $553,096 of accumulated amortization.

As of December 31, 2019,

intangible assets total $698,800, net of $533,415 of accumulated amortization.

The Company capitalized

$870 in patent cost during the three months ended March 31, 2020.

Amortization expense for

the three months ended March 31, 2020 and 2019 was $9,720 and $9,592, respectively.

License and distributor

rights were acquired by the Company in January 1999 and provide exclusive use distribution of polymers and polymer based products.

The Company capitalized $14,673 in patent cost

during the six months ended June 30, 2020.

expense for the three months ended June 30, 2020 and 2019 was $9,961 and $9,979, respectively.

expense for the six months ended June 30, 2020 and 2019 was $19,681 and $19,630, respectively.

and distributor rights were acquired by the Company in January 1999 and provide exclusive use distribution of polymers and polymer

based products.

The Company has a non-expiring term on the license and distribution rights.

Accordingly, the Company annually assesses this license

and distribution rights for impairment and has determined that no impairment write-down is considered necessary as of March 31,

Accordingly, the Company annually

assesses this license and distribution rights for impairment and has determined that no impairment write-down is considered necessary

as of June 30, 2020.

OPTIONS AND WARRANTS

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The following is a summary

of option activity during the three months ended March 31, 2020.

of option activity during the six months ended June 30, 2020.

Average Exercise Price

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Options canceled

March 31, 2020

following is a summary of option activity during the three months ended March 31, 2019.

June 30, 2020

following is a summary of option activity during the six months ended June 30, 2019.

Average Exercise Price

December 31, 2018

Options granted and assumed

Options granted and

Options expired

Options canceled

Options exercised

Balance, March

As of March 31, 2020, all

stock options outstanding are exercisable.

June 30, 2019

As of June 30, 2020, all stock options

outstanding are exercisable.

Stock warrants

The following

is a summary of warrants activity during the the three months ended March 31, 2020

is a summary of warrants activity during the six months ended June 30, 2020

Average Exercise Price

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Warrants canceled

March 31, 20 20

following is a summary of warrants activity during the three months ended March 31, 2019.

June 30, 20 20

following is a summary of warrants activity during the six months ended June 30, 2019.

Average Exercise Price

December 31, 2018

Warrants granted and assumed

Warrants granted and

Warrants expired

Warrants canceled

Warrants exercised

Balance, March

As of March 31, 2020, all

June 30, 2019

As of June 30, 2020, all

stock warrants outstanding are exercisable.

Secured debt offering

During the period from May

22, 2013 and December 31, 2018, the Company entered into 9% notes payable to nineteen investors and received proceeds of $552,000.

the period from May 22, 2013 and December 31, 2018, the Company entered into 9% notes payable to nineteen investors and received

proceeds of $552,000.

The notes were due two years from the anniversary date of execution.

The Notes are secured by the US Patent rights granted for

the Company's Sunscreen Products:

The Notes are secured by the US Patent

rights granted for the Company's Sunscreen Products:

US patent number #8,128,913:

"Sunscreen Composition with Enhanced UV-A Absorber Stability

and Methods.”

As of March 31, 2020, $552,000

of the outstanding notes payable are past due and in default and have been classified as current notes payable.

"Sunscreen Composition with Enhanced UV-A

Absorber Stability and Methods.”

of June 30, 2020, $552,000 of the outstanding notes payable are past due and in default and have been classified as current notes

RELATED PARTY TRANSACTIONS

During the three months

ended March 31, 2020, $22,000 was advanced by an officer.

As of December 31, 2019,

$68,899 in advances remained due to officers of the company.

All other related party notes have been extinguished or re-negotiated

as convertible notes.

the six months ended June 30, 2020, $27,000 was advanced by an officer and $15,000 was repaid to another officer.

of June 30, 2020, $58,899 in advances remained due to officers of the company.

All other related party notes have been extinguished

or re-negotiated as convertible notes.

(See note 9 for additional details.)

License Agreement

with Ovation Science for DermSafe hand sanitizer - On

February 3, 2020, we entered into a License Agreement with Ovation Science Inc., a related party, pursuant to which

Skinvisible granted to Ovation Science Inc.

a license for the manufacture and distribution rights to its hand sanitizer

product, DermSafe.

Agreement with Ovation Science for DermSafe hand sanitizer - On February 3, 2020, we entered into a License Agreement

with Ovation Science Inc., a related party, pursuant to which Skinvisible granted to Ovation Science Inc.

a license for the manufacture

and distribution rights to its hand sanitizer product, DermSafe.

In exchange for the license, Ovation Science Inc.

agreed to pay to Skinvisible a percentage on all net

sales on the licensed products subject to adjustment in certain situations plus

a license fee payable in year 3 of the agreement if it chooses to continue the license.

The Company earned $7,643 in

royalties under the license agreement during the three months ending March 31, 2020.

agreed to pay

to Skinvisible a percentage on all net sales on the licensed products subject to adjustment in certain situations plus

an extension fee of $100,000 payable in year 3 of the agreement if it chooses to continue the license.

June 10, 2020, Ovation Science Inc.

accelerated the extension fee and paid the

Company the $100,000 otherwise due in year 3 and in exchange the Company extended the term of Ovation’s license to

6-years and transferred to Ovation additional rights to its hand sanitizer products and assigned Canadian Identification

Numbers 02310589 and 02355558, all DermSafe Trademarks, DermSafe clinical data and the right to patent DermSafe where not

currently patented.

The Company completed the required assignments during the three months ending June 30, 2020 and

recognized $100,000 in revenue, as the license was considered to be functional, and therefore revenue is recognized at a

point in time.

Company earned $3,838 in royalties under the license agreement during the three months ending June 30, 2020.

Company earned $11,481 in royalties under the license agreement during the six months ending June 30, 2020.

NOTES PAYABLE

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Total, net of unamortized

June 30, 2019, the Company renegotiated accrued salaries and interest and outstanding convertible notes for a former

Under the terms of the agreements, all outstanding notes totaling $224,064, accrued interest of $119,278, accrued

salaries of $7,260 and accrued vacation of $1,473 were converted to a promissory note convertible into common stock with a

warrant feature.

The promissory note is unsecured, due five years from issuance, and bears an interest rate of 10%.

noteholder’s option until the repayment date, the note may be converted to shares of the Company’s common stock

at a fixed price of $0.20 per share along with warrants to purchase one share for every two shares issued at the exercise

price of $0.30 per share for three years after the conversion date.

June 30, 2019, the Company renegotiated accrued salaries and interest and outstanding

convertible notes for a former employee.

Under the terms of the agreements, all outstanding

notes totaling $224,064, accrued interest of $119,278, accrued salaries of $7,260 and

accrued vacation of $1,473 were converted to a promissory note convertible into common

stock with a warrant feature.

The convertible promissory

note is unsecured, due five

years from issuance, and bears an interest rate of 10%.

At the noteholder’s option

until the repayment date, the note may be converted to shares of the Company’s

common stock at a fixed price of $0.20 per share along with warrants to purchase one

share for every two shares issued at the exercise price of $0.30 per share for three

years after the conversion date.

The Company has determined the value

associated with the beneficial conversion feature in connection with the notes to be

The aggregate beneficial

conversion feature has been accreted and charged to interest expenses as a financing expense in the amount of $12,674 during

the three months ended March 31, 2020 and nil for the three months ended March 31, 2019.

The beneficial conversion feature is

valued under the intrinsic value method

$280,076 as valued under the intrinsic value method.

aggregate beneficial conversion feature has been accreted and charged to interest expenses

as a financing expense in the amount of $25,348 during the six months ended June 30,

2020 and nil for the six months ended June 30, 2019.

aggregate beneficial conversion feature has been accreted and charged to interest expenses

as a financing expense in the amount of $12,674 during the three months ended June 30,

2020 and nil for the three months ended June 30, 2019.

debt discount

Total, net of unamortized

Convertible Notes

long-term convertible notes

Total Convertible Notes

Current portion:

Total long-term convertible notes

NOTES PAYABLE RELATED PARTY

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of the following:

On June 30, 2019, the Company

renegotiated accrued salaries, accrued interest, unpaid reimbursements, cash advances, and outstanding convertible notes for

its two officers.

Under the terms of the agreements, all outstanding notes totaling $2,464,480, accrued interest of $966,203,

accrued salaries of $617,915, accrued vacation of $64,423, unpaid reimbursements of $11,942 and cash advances of $110,245

were converted to promissory notes convertible into common stock with a warrant feature.

The promissory notes are unsecured,

due five years from issuance, and bear an interest rate of 10%.

At the investor’s option until the repayment date, the

note may be converted to shares of the Company’s common stock at a fixed price of $0.20 per share along with warrants

to purchase one share for every two shares issued at the exercise price of $0.30 per share for three years after the conversion

The Company has determined the value associated with the beneficial conversion feature in connection

with the notes to be $3,369,244.

The aggregate beneficial conversion feature associated with these notes has been accreted

and charged to interest expenses as a financing expense in the amount of $152,463 during the three months ended March 31,

2020 and nil for the three months ended March 31, 2019.

June 30, 2019, the Company renegotiated accrued salaries, accrued interest, unpaid reimbursements,

cash advances, and outstanding convertible notes for its two officers.

Under the terms

of the agreements, all outstanding notes totaling $2,464,480, accrued interest of $966,203,

accrued salaries of $617,915, accrued vacation of $64,423, unpaid reimbursements of $11,942

and cash advances of $110,245 were converted to promissory notes convertible into common

stock with a warrant feature.

The convertible promissory notes

are unsecured, due five years from issuance, and bear an interest rate of 10%.

investor’s option until the repayment date, the note may be converted to shares

of the Company’s common stock at a fixed price of $0.20 per share along with warrants

to purchase one share for every two shares issued at the exercise price of $0.30 per

share for three years after the conversion date.

The Company has determined the value associated with the beneficial conversion feature

in connection with the notes to be $3,369,244.

The aggregate beneficial conversion feature

associated with these notes has been accreted and charged to interest expenses as a financing

expense in the amount of $304,926 during the six months ended June 30, 2020 and nil for

the six months ended June 30, 2019.

aggregate beneficial conversion feature has been accreted and charged to interest expenses

as a financing expense in the amount of $152,463 during the three months ended June 30,

2020 and nil for the three months ended June 30, 2019.

Unamortized debt discount

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The Company had 4,471,746 and 4,471,746 issued and

outstanding shares of common stock as of March 31, 2020 and December 31, 2019, respectively.

outstanding shares of common stock as of June 30, 2020 and December 31, 2019, respectively.

As of June 30,

2020, and December 31, 2019, the Company had 68,097 shares remaining to be issued to the investors as a result of the settlement

agreements and has a remaining stock payable of $59,602.

On October 17,

2019, Skinvisible entered an Exclusive License Agreement with Quoin pursuant to which Skinvisible granted to Quoin a license to

certain patents for the development of products for commercial sale.

In exchange for the license, Quoin agreed to pay to Skinvisible

a license fee of $1,000,000 and a single digit royalty interest of all net sales on the licensed products subject to adjustment

in certain situations.

The agreement also requires that Quoin make certain milestone payments to Skinvisible upon achieving regulatory

approval milestones for certain drug products.

agreement terminated, if among other things, 50% of the license fee is not paid by December 31, 2019 and if the full License Fee

is not paid by March 31, 2020.

No payments were made by Quoin and the agreement was terminated.

Both Parties subsequently determined

that they continue to see the value in a partnership and therefore on May 8, 2020 the companies agreed to extend the Exclusive

License Agreement under the same terms to expire now on July 31, 2020.

of the date of this filing no payments had been received.

October 17, 2019, Skinvisible entered an Exclusive License Agreement with Quoin pursuant to which Skinvisible granted to Quoin

a license to certain patents for the development of products for commercial sale.

In exchange for the license, Quoin agreed to

pay to Skinvisible a license fee of $1,000,000 and a royalty percentage on all

net sales on the licensed products subject to adjustment in certain situations.

The agreement also requires that Quoin make certain

milestone payments to Skinvisible upon achieving regulatory approval milestones for certain drug products.

agreement is subject to termination, if among other things, 50% of the license fee is not paid by December 31, 2019 and if the

full License Fee is not paid by March 31, 2020.

No payments were made by Quoin and the agreement was terminated on December 31,

Both Parties subsequently

determined that they continue to see the value in a partnership and therefore on May 8, 2020 and again on July 31, 2020 the companies

agreed to extend the Exclusive License Agreement, as amended under the same terms to expire now on September 30, 2020.

As of the date of this filing no payments had been received.

In accordance with ASC Topic 855-10,

the Company has analyzed its operations subsequent to March 31, 2020 to the date these financial statements were issued and has

the Company has analyzed its operations subsequent to June 30, 2020 to the date these financial statements were issued and has

determined that it does not have any material subsequent events to disclose in these financial statements.

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Discussion and Analysis of Financial Condition and Results of Operations

Certain statements, other than purely

historical information, including estimates, projections, statements relating to our business plans, objectives, and expected

operating results, and the assumptions upon which those statements are based, are “forward-looking statements”

the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E

of the Securities Exchange Act of 1934.

Certain statements,

other than purely historical information, including estimates, projections, statements relating to our business plans, objectives,

and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements”

within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section

21E of the Securities Exchange Act of 1934.

These forward-looking statements generally are identified by the words “believes,”

53 unchanged sentences

the effects on our customers, partners, or vendors, or on our financial results.

Recent Developments

License with Quoin Pharmaceuticals,

Quoin Pharmaceuticals, Inc.

On October 17,

2 unchanged sentences

In exchange for the license, Quoin agreed to pay to Skinvisible

a license fee of $1,000,000 and a single digit royalty interest of all net sales on the licensed products subject to adjustment

in certain situations.

The agreement also requires that Quoin make certain milestone payments to Skinvisible upon achieving regulatory

approval milestones for certain drug products.

agreement terminated, if among other things, 50% of the license fee is not paid by December 31, 2019 and if the full License Fee

is not paid by March 31, 2020.

a license fee of $1,000,000 and a royalty percentage on all net sales on the licensed products subject to adjustment in certain

The agreement also requires that Quoin make certain milestone payments to Skinvisible upon achieving regulatory approval

milestones for certain drug products.

agreement is subject to termination, if among other things, 50% of the license fee is not paid by December 31, 2019 and if the

full License Fee is not paid by March 31, 2020.

No payments were made by Quoin and the agreement was terminated.

Both Parties subsequently determined

that they continue to see the value in a partnership and therefore on May 8, 2020 the companies agreed to extend the Exclusive

License Agreement under the same terms to expire now on July 31, 2020.

of the date of this filing no payments had been received.

License with Ovation Science Inc.

On February 3, 2020, we entered into

a License Agreement with Ovation Science Inc.

pursuant to which Skinvisible granted to Ovation Science Inc.

a license for the

manufacture and distribution rights to its hand sanitizer product, DermSafe.

In exchange for the license, Ovation Science Inc.

agreed to pay to Skinvisible a single digit royalty interest on all net sales on the licensed products subject to adjustment in

certain situations plus a license fee payable in year 3 of the agreement if it chooses to continue the license.

Results of Operations for the

Three Months Ended March 31, 2020 and 2019

Our revenue from product sales, royalties

on patent licenses and license fees (product development fees) for the three months ended March 31, 2020 was $16,052, an increase

from $8,367 for the same period ended March 31, 2019.

The increase in revenue for three

months ended March 31, 2020 was mainly due to our license agreement with Ovation Science.

We hope to generate more revenues from

this license and the license with Quoin for the rest of the year.

Cost of Revenues

Our cost of revenues for the three

months ended March 31, 2020 was $0, compared with the prior year period when cost of revenues was $376.

Our cost of revenues decreased for

the three months ended March 31, 2020 over the prior year period because our revenues in 2020 were attributable to our license

with Ovation Science.

Gross profit for the three months

ended March 31, 2020 was $16,052 , as compared with gross profit of $7,991 for the

three months ended March 31, 2019.

subsequently determined that they continue to see the value in a partnership and therefore on May 8, 2020 and again on July 31,

2020 the companies agreed to extend the Exclusive License Agreement under the same terms to expire now on September 30, 2020.

As of the date of this filing no payments had been received.

Ovation Science Inc.

February 3, 2020, we entered into a License Agreement with Ovation Science Inc.

pursuant to which Skinvisible granted to Ovation

a license for the manufacture and distribution rights to its hand sanitizer product, DermSafe.

In exchange for the

license, Ovation Science Inc.

agreed to pay to Skinvisible a royalty percentage on all net sales on the licensed products subject

to adjustment in certain situations plus a license fee payable in year 3 of the agreement if it chooses to continue the license.

On June 10, 2020, the agreement

was further amended to provide additonal assignment rights for its hand sanitizer products in exchange for $100,000 which was

recognized as revenue during the three months ended June 30, 2020.

Operations for the Three Months Ended June 30, 2020 and 2019

from product sales, royalties on patent licenses and license fees (product development fees) for the three months ended June 30,

2020 was $119,970, an increase from $12,717 for the same period ended June 30, 2019.

in revenue for three months ended June 30, 2020 was mainly due to our license agreement with Ovation Science.

We hope to generate

more revenues from this license and the license with Quoin for the rest of the year.

revenues for the three months ended June 30, 2020 was $0, compared with the prior year period when cost of revenues was $6,573.

revenues decreased for the three months ended June 30, 2020 over the prior year period because our revenues in 2020 were attributable

to our license with Ovation Science.

for the three months ended June 30, 2020 was $119,970 , as compared with gross profit of $6,144 for the three months ended

June 30, 2019.

Operating expenses

Operating expenses decreased to $146,044

for the three months ended March 31, 2020 from $154,083 for the same period ended March 31, 2019.

Our operating expenses for the three

months ended March 31, 2020 consisted mainly of accrued salaries and wages of $87,942, audit and accounting of $28,870, and amortization

In comparison, our operating expenses for the three months ended March 31, 2019 consisted mainly of accrued salaries

and wages of $87,942, audit and accounting of $22,633, rent of $14,037 and depreciation and amortization of $9,651

Other Expenses

We had other expenses of $300,092

for the three months ended March 31, 2020, compared with other expenses of $197,007 for the three months ended March 31, 2019.

other expenses for the three months ended March 31, 2020 consisting entirely of interest expense which includes, interest expense

decreased to $132,732 for the three months ended June 30, 2020 from $145,440 for the same period ended June 30, 2019.

Our operating

expenses for the three months ended June 30, 2020 consisted mainly of accrued salaries and wages of $87,942, audit and accounting

of $16,610, and amortization of $9,962.

In comparison, our operating expenses for the three months ended June 30, 2019 consisted

mainly of accrued salaries and wages of $87,942, audit and accounting of $9,610, rent of $15,673 and depreciation and amortization

expenses of $300,031 for the three months ended June 30, 2020, compared with other expenses of $443,715 for the three months ended

June 30, 2019.

other expenses for the three months ended June 30, 2020 consisting entirely of $300,031 in interest expense, which includes interest

expense of $134,895 and debt discount amortization of $165,136, compared

with the three months ended June 30, 2019, which consisted primarily of loss on extinguishment of debts of $247,998 and $203,217

in interest expense, which includes interest expense of $88,629 and debt discount amortization of $113,378.

a net loss of $312,793 for the three months ended June 30, 2020, as compared with a net loss of $583,011 for the three months

ended June 30, 2019.

Operations for the Six Months Ended June 30, 2020 and 2019

from product sales, royalties on patent licenses and license fees (product development fees) for the six months ended June 30,

2020 was $136,022, an increase from $21,084 for the same period ended June 30, 2019.

in revenue for six months ended June 30, 2020 was mainly due to our license agreement with Ovation Science.

We hope to generate

more revenues from this license and the license with Quoin for the rest of the year.

revenues for the six months ended June 30, 2020 was $0, compared with the prior year period when cost of revenues was $6,949.

revenues decreased for the six months ended June 30, 2020 over the prior year period because our revenues in 2020 were attributable

to our license with Ovation Science.

for the six months ended June 30, 2020 was $136,022 , as compared with gross profit of $14,135 for the six months ended June

Operating expenses

decreased to $278,776 for the six months ended June 30, 2020 from $299,523 for the same period ended June 30, 2019.

Our operating

expenses for the six months ended June 30, 2020 consisted mainly of accrued salaries and wages of $175,885, audit and accounting

of $45,480, and amortization of $19,681.

In comparison, our operating expenses for the six months ended June 30, 2019 consisted

mainly of accrued salaries and wages of $175,885, audit and accounting of $32,242, rent of $29,709 and depreciation and amortization

expenses of $600,123 for the six months ended June 30, 2020, compared with other expenses of $640,722 for the six months ended

June 30, 2019.

other expenses for the six months ended June 30, 2020 consisting entirely of interest expense which includes, interest expense

of $269,849 and debt discount amortization of $330,274 , compared

with the three months ended March 31, 2019 which consisted primarily of $202,007 in

with the six months ended June 30, 2019 which consisted primarily of loss on extinguishment of debt of $247,998 and $405,224 in

interest expense which includes, interest expense of $177,832 and debt discount amortization of $227,392.

We recorded a net loss of $430,084

for the three months ended March 31, 2020, as compared with a net loss of $343,099 for the three months ended March 31, 2019.

Liquidity and Capital Resources

As of March 31, 2020, we had total

current assets of $18,238 and total assets in the amount of $174,773.

Our total current liabilities as of March 31, 2020 were

We had a working capital deficit of $3,593,786 as of March 31, 2020, compared with a working capital deficit of $5,232,674

as of March 31, 2019.

Operating activities used $15,849

in cash for the three months ended March 31, 2020, as compared with $45,951 used for the three months ended March 31, 2019.

negative operating cash flow for each period was largely the result of our net losses for those periods.

We used cash of $870 and $926 in

investing activities for the three months ended March 31, 2020 and 2019, respectively, for the purchase of intangible assets.

Cash flows provided by financing

activities during the three months ended March 31, 2020 amounted to $22,000, as compared with $46,400

for the three months ended March 31, 2020.

Our cash flows for the three months ended March 31, 2020 and 2019 consisted of proceeds

from related party loans.

The features of the debt instruments

and payables concerning our financing activities are detailed in the footnotes to our financial statements.

Based upon our current financial

condition, we do not have sufficient cash to operate our business at the current level for the next twelve months.

fund operations through increased sales and debt and/or equity financing arrangements, which may be insufficient to fund expenditures

or other cash requirements.

We plan to seek additional financing in a private equity offering to secure funding for operations.

a net loss of $742,877 for the six months ended June 30, 2020, as compared with a net loss of $926,110 for the six months ended

June 30, 2019.

and Capital Resources

As of June 30,

2020, we had total current assets of $56,188 and total assets in the amount of $216,565.

Our total current liabilities as of June

30, 2020 were $2,364,471.

We had a working capital deficit of $2,308,283 as of June 30, 2020, compared with a working capital

deficit of $1,900,688 as of June 30, 2019.

Operating activities

provided $36,464 in cash for the six months ended June 30, 2020, as compared with $49,402 used for the six months ended June 30,

Our positive operating cash flow for the six months ended June 30, 2020 is largely the result of an increase in accrued

interest, accounts payable and accrued liabilities, offset mainly by our net loss for the period, compared with the six month

ended June 30, 2019, which recorded a negative operating cash flow largely as the result of our net loss for the period.

of $14,673 and $24,319 in investing activities for the six months ended June 30, 2020 and 2019, respectively, for the purchase

of intangible assets.

Cash flows provided

by financing activities during the six months ended June 30, 2020 amounted to $12,000, as compared with $71,239 for the six

months ended June 30, 2019.

Our cash flows for the six months ended June 30, 2020 and 2019 consisted of proceeds from related

of the debt instruments and payables concerning our financing activities are detailed in the footnotes to our financial statements.

Based upon our

current financial condition, we do not have sufficient cash to operate our business at the current level for the next twelve months.

We intend to fund operations through increased sales and debt and/or equity financing arrangements, which may be insufficient

to fund expenditures or other cash requirements.

We plan to seek additional financing in a private equity offering to secure funding

for operations.

There can be no assurance that we will be successful in raising additional funding.

If we are not able to secure additional funding,

the implementation of our business plan will be impaired.

There can be no assurance that such additional financing will be available

to us on acceptable terms or at all.

Going concern –

accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and

the satisfaction of liabilities in the normal course of business.

We have incurred cumulative net losses of $33,682,880 since

our inception and require capital for our contemplated operational and marketing activities to take place.

Our ability to raise

additional capital through the future issuances of common stock is unknown.

The obtainment of additional financing, the successful

development of our contemplated plan of operations, and our transition, ultimately, to the attainment of profitable operations

are necessary for us to continue operations.

The ability to successfully resolve these factors raise substantial doubt about our

ability to continue as a going concern.

These consolidated financial statements do not include any adjustments that may result

from the outcome of these aforementioned uncertainties.

Off Balance Sheet Arrangements

As of March 31, 2020, there were

no off balance sheet arrangements.

Critical Accounting Policies

In December 2001, the SEC requested

that all registrants list their most “critical accounting polices”

in the Management Discussion and Analysis.

SEC indicated that a “critical accounting policy”

is one which is both important to the portrayal of a company’s

financial condition and results, and requires management’s most difficult, subjective or complex judgments, often as a result

of the need to make estimates about the effect of matters that are inherently uncertain.

Product sales –

from the sale of products (Invisicare®

polymers) are recognized when title to the products are transferred to the customer

and only when no further contingencies or material performance obligations are warranted, and thereby have earned the right to

receive reasonably assured payments for products sold and delivered.

Royalty sales –

recognize royalty revenue from licensing our patented product formulations only when earned, with no further contingencies or

material performance obligations are warranted, and thereby have earned the right to receive and retain reasonably assured payments.

Distribution and license rights

sales –

We also recognize revenue from distribution and license rights only when earned (and are amortized over a five-year

period), with no further contingencies or material performance obligations are warranted, and thereby have earned the right to

receive and retain reasonably assured payments.

Costs of Revenue –

of revenue includes raw materials, component parts, and shipping supplies.

Shipping and handling costs is not a significant portion

of the cost of revenue.

Accounts Receivable –

Accounts receivable is comprised of uncollateralized customer obligations due under normal trade terms requiring payment within

30 days from the invoice date.

The carrying amount of accounts receivable is reviewed periodically for collectability.

If management

determines that collection is unlikely, an allowance that reflects management’s best estimate of the amounts that will not

be collected is recorded.

Management reviews each accounts receivable balance that exceeds 30 days from the invoice date and,

based on an assessment of creditworthiness, estimates the portion, if any, of the balance that will not be collected.

31, 2020, the Company had not recorded a reserve for doubtful accounts.

has $175,000 in convertible notes payable which are secured by the accounts receivable of a license agreement the Company has

with Women's Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®.

Recently Issued Accounting Pronouncements

We do not expect the adoption of

recently issued accounting pronouncements to have a significant impact on our results of operations, financial position or cash

If we are not able to secure

additional funding, the implementation of our business plan will be impaired.

There can be no assurance that such additional financing

will be available to us on acceptable terms or at all.

Going concern

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization

of assets and the satisfaction of liabilities in the normal course of business.

We have incurred cumulative net losses of $33,995,673

since our inception and require capital for our contemplated operational and marketing activities to take place.

Our ability to

raise additional capital through the future issuances of common stock is unknown.

The obtainment of additional financing, the

successful development of our contemplated plan of operations, and our transition, ultimately, to the attainment of profitable

operations are necessary for us to continue operations.

The ability to successfully resolve these factors raise substantial doubt

about our ability to continue as a going concern.

These consolidated financial statements do not include any adjustments that

may result from the outcome of these aforementioned uncertainties.

Sheet Arrangements

As of June 30,

2020, there were no off balance sheet arrangements.

Accounting Policies

2001, the SEC requested that all registrants list their most “critical accounting polices”

in the Management Discussion

and Analysis.

The SEC indicated that a “critical accounting policy”

is one which is both important to the portrayal

of a company’s financial condition and results, and requires management’s most difficult, subjective or complex judgments,

often as a result of the need to make estimates about the effect of matters that are inherently uncertain.

Product sales

Revenues from the sale of products (Invisicare®

polymers) are recognized when title to the products are transferred

to the customer and only when no further contingencies or material performance obligations are warranted, and thereby have earned

the right to receive reasonably assured payments for products sold and delivered.

Royalty sales

We also recognize royalty revenue from licensing our patented product formulations only when earned, with no further

contingencies or material performance obligations are warranted, and thereby have earned the right to receive and retain reasonably

assured payments.

and license rights sales –

We also recognize revenue from distribution and license rights only when earned (and are

amortized over a five-year period), with no further contingencies or material performance obligations are warranted, and thereby

have earned the right to receive and retain reasonably assured payments.

Revenue –

Cost of revenue includes raw materials, component parts, and shipping supplies.

Shipping and handling costs

is not a significant portion of the cost of revenue.

Receivable –

Accounts receivable is comprised of uncollateralized customer obligations due under normal trade terms

requiring payment within 30 days from the invoice date.

The carrying amount of accounts receivable is reviewed periodically for

collectability.

If management determines that collection is unlikely, an allowance that reflects management’s best estimate

of the amounts that will not be collected is recorded.

Management reviews each accounts receivable balance that exceeds 30 days

from the invoice date and, based on an assessment of creditworthiness, estimates the portion, if any, of the balance that will

not be collected.

As of June 30, 2020, the Company had not recorded a reserve for doubtful accounts.

The Company has $175,000

in convertible notes payable which are secured by the accounts receivable of a license agreement the Company has with Women's

Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®.

Issued Accounting Pronouncements

We do not expect

the adoption of recently issued accounting pronouncements to have a significant impact on our results of operations, financial

position or cash flow.

Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company is not

required to provide the information required by this Item.

A smaller reporting

company is not required to provide the information required by this Item.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements