What changed in this filing

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Item 1. Financial Statements

2021-08-16 compared with 2021-06-15 · 416 added, 615 removed, 117 unchanged (90% of the section changed)

Financial Statements

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

F-1 Condensed Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020

F-2 Condensed Consolidated Statements of Operations for the three months ended March 31, 2021 and March

31, 2020 (unaudited);

F-3 Condensed Consolidated Statements of Stockholders’

Deficit for the three months

ended March 31, 2021 and 2020 (unaudited);

F-4 Condensed Consolidated Statements of Cash Flow for the three months ended March 31, 2021 and 2020

F-5 Notes to Condensed Consolidated Financial Statements.

CONSOLIDATED BALANCE SHEETS

March 31, 2021

December 31, 2020

F-1 Consolidated

Balance Sheets as of June 30, 2021 and December 31, 2020 (unaudited);

F-2 Consolidated

Statements of Operations for the three and six months ended June 30, 2021 and 2020 (unaudited);

Consolidated Statements of Stockholders’ Equity

( Deficit) for the six months ended June 30, 2021 and 2020 (unaudited);

Consolidated Statements of Cash Flow for the six months

ended June 30, 2021 and 2020 (unaudited);

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 June 30, 2021 are not necessarily

indicative of the results that can be expected for the full year.

BALANCE SHEETS

Current assets

Accounts receivable

Prepaid expense and other current assets

Total current assets

Patents and trademarks, net

LIABILITIES AND STOCKHOLDERS' DEFICIT

expense and other current assets

current assets

and trademarks, net

LIABILITIES AND STOCKHOLDERS'

Current liabilities

Accounts payable and accrued liabilities

Accounts payable related party

Accrued interest payable

Derivative liability

Loans from related party

payable and accrued liabilities

payable related party

interest payable

from related party

notes payable

Convertible notes payable

Total current liabilities

Convertible notes payable related party, net of unamortized discount of $2,447,770 and $3,060,970 respectively

Convertible notes payable, net of unamortized debt discount of $203,476 and

$54,450, respectively, less current portion

current liabilities

notes payable related party, net of unamortized discount of $ 2,142,844 and $ 2,447,770 respectively

notes payable, net of unamortized debt discount of $ 178,268 and $ 203,476 , respectively

Total liabilities

1 unchanged sentence

Common stock;

$0.001 par value;

200,000,000 shares authorized;

4,539,843 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively

Shares payable

Additional paid-in capital

Accumulated deficit

4,539,843 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively

paid-in capital

( 35,404,427 )

Total stockholders' deficit

Total liabilities and stockholders' deficit

( 34,700,408 )

stockholders' deficit

( 5,105,493 )

( 4,454,779 )

liabilities and stockholders' deficit

Accompanying Notes to Condensed Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF OPERATIONS

Three months ended

March 31, 2021

March 31, 2020

Revenues related party

Cost of revenues

Operating expenses

Depreciation and amortization

Selling general and administrative

Total operating expenses

and amortization

general and administrative

operating expenses

(loss) from operations

Other income and (expense)

change in derivative liability

on settlement of debt

other expense

Interest expense

Loss on change of derivative liability

Total other expense

Basic loss per common share

Fully diluted loss per common share

Basic weighted average common shares outstanding

Fully diluted weighted average common shares outstanding

income (loss)

$ ( 268,514 )

$ ( 312,793 )

$ ( 704,019 )

$ ( 742,877 )

loss per common share

diluted loss per common share

weighted average common shares outstanding

diluted weighted average common shares outstanding

Accompanying Notes to Condensed Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ DEFICIT

Additional Paid-in

Stockholders’

Balance, December 31, 2020

Stockholders' Deficit

December 31, 2020

$ ( 34,700,408 )

3 unchanged sentences

$ ( 4,890,284 )

Derivative liability

written off to APIC

Balance, June 30,

$ ( 35,404,427 )

$ ( 5,105,493 )

Balance, December

4 unchanged sentences

( 3,437,251 )

See Accompanying

Notes to Condensed Consolidated Financial Statements.

Balance, June 30,

$ ( 33,995,673 )

$ ( 3,750,044 )

Accompanying Notes to Condensed Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Three months ended

March 31, 2021

March 31, 2020

Cash flows from operating activities:

Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization

Amortization of debt discount

Loss on change of derivative liability

Changes in operating assets and liabilities:

Decrease (Increase) in prepaid assets

Decrease (Increase) in accounts receivable

Increase in accounts payable and accrued liabilities

Decrease in due from related party

Increase in accrued interest

Net cash provided used in operating activities

Cash flows from investing activities:

Purchase of fixed and intangible assets

Net cash used in investing activities

Cash flows from financing activities:

Payments on related party loans

Proceeds from related party loans

Net cash provided by (used in) financing activities

Cash flows from operating

$ ( 704,019 )

$ ( 742,877 )

to reconcile net loss to net cash

provided (used) by operating activities:

and amortization

of debt discount

settlement of debt

change in derivative liability

in operating assets and liabilities:

(Increase) in prepaid assets

(Increase) in accounts receivable

in accounts payable and accrued liabilities

in due from related party

in accrued interest

provided by operating activities

Cash flows from investing

of fixed and intangible assets

used in investing activities

Cash flows from financing

on related party loans

from related party loans

on loans payable

on convertible notes payable

cash provided by (used in) financing activities

Net change in cash

1 unchanged sentence

Cash, end of period

Supplemental disclosure of cash flow information:

Cash paid for interest

Cash paid for tax

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

Non-cash investing and financing activities:

Accompanying Notes to Consolidated Financial Statements.

NOTES TO CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS

OF BUSINESS AND HISTORY

Description of business –

Inc., (referred to as the “Company”) is focused on the development and manufacture and sales of innovative topical,

transdermal and mucosal polymer-based delivery system technologies and formulations incorporating its patent-pending formula/process

for combining hydrophilic and hydrophobic polymer emulsions.

The technologies and formulations have broad industry applications

within the pharmaceutical, over-the-counter, personal skincare and cosmetic arenas.

Additionally, the Company’s non-dermatological

formulations, offer solutions for a broad spectrum of markets women’s health, pain management, and others.

The Company maintains

executive and sales offices in Las Vegas, Nevada.

History –

The Company was incorporated

Supplemental disclosure of

cash flow information:

paid for interest

SUPPLEMENTAL DISCLOSURE OF

CASH FLOW INFORMATION:

investing and financing activities:

Accompanying Notes to Condensed Consolidated Financial Statements.

SKINVISIBLE, INC.

NOTES TO CONSOLIDATED

FINANCIAL STATEMENTS

JUNE 30, 2021

DESCRIPTION OF BUSINESS

Description of business – Skinvisible,

Inc., (referred to as the “Company”) is focused on the development and manufacture and sales of innovative topical, transdermal

and mucosal polymer-based delivery system technologies and formulations incorporating its patent-pending formula/process for combining

hydrophilic and hydrophobic polymer emulsions.

The technologies and formulations have broad industry applications within the pharmaceutical,

over-the-counter, personal skincare and cosmetic arenas.

Additionally, the Company’s non-dermatological formulations, offer solutions

for a broad spectrum of markets women’s health, pain management, and others.

The Company maintains executive and sales offices in

Las Vegas, Nevada.

History – The Company was incorporated

in Nevada on March 6, 1998 , under the name of Microbial Solutions, Inc.

The Company underwent a name change on February 26, 1999,

when it changed its name to Skinvisible, Inc.

The Company’s subsidiary’s name of Manloe Labs, Inc.

was also changed

to Skinvisible Pharmaceuticals, Inc.

The Company underwent a name change on February 26, 1999, when

it changed its name to Skinvisible, Inc.

The Company’s subsidiary’s name of Manloe Labs, Inc.

was also changed to Skinvisible

Pharmaceuticals, Inc.

Skinvisible, Inc., together with its subsidiaries,

shall herein be collectively referred to as the “Company.”

OF PRESENTATION AND GOING CONCERN

Basis of presentation –

The accompanying

unaudited interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted

in the United States of America for interim financial information and with the instructions to Quarterly Report on Form 10-Q and

Article 10 of Regulation S-X , and should be read in conjunction with the audited financial statements and notes thereto contained

in the Company’s most recent Annual Financial Statements on Form 10-K filed with the SEC on April 15, 2021.

In the opinion

of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of financial position

and the results of operations for the interim period presented have been reflected herein.

The results of operations for the interim

period are not necessarily indicative of the results to be expected for the full year.

Notes to the financial statements which

would substantially duplicate the disclosures contained in the audited financial statements for the most recent fiscal period,

as reported in the Form 10-K, have been omitted.

The condensed consolidated balance sheet at

December 31, 2020 has been derived from the audited financial statements at that date, but does not include all of the information

and footnotes required by generally accepted accounting principles in the U.S.

Basis of presentation – The accompanying unaudited

interim financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United

States of America for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation

S-X , and should be read in conjunction with the audited financial statements and notes thereto contained in the Company’s most

recent Annual Financial Statements on Form 10-K filed with the SEC on April 15, 2021.

In the opinion of management, all adjustments, consisting

of normal recurring adjustments, necessary for a fair presentation of financial position and the results of operations for the interim

period presented have been reflected herein.

The results of operations for the interim period are not necessarily indicative of the results

to be expected for the full year.

Notes to the financial statements which would substantially duplicate the disclosures contained in the

audited financial statements for the most recent fiscal period, as reported in the Form 10-K, have been omitted.

The condensed consolidated balance sheet at December

31, 2020 has been derived from the audited financial statements at that date, but does not include all of the information and footnotes

required by generally accepted accounting principles in the U.S.

for complete financial statements.

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.

For the three months ended March 31, 2021, the Company had a net loss of $435,505 The Company

has also incurred cumulative net losses of $35,135,913 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 within one year from the date of filing.

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.

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.

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.

For the six months ended June 30, 2021, the Company had a net loss of $ 704,019 .

The Company has also incurred cumulative net losses of $ 35,404,427

since its inception and requires capital for

its contemplated operational and marketing activities to take place.

These factors, among others, raise substantial

doubt about the Company’s ability to continue as a going concern within one year from the date of filing.

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.

COVID-19 Pandemic

In December 2019, an outbreak of a novel

strain of coronavirus originated in Wuhan, China (“COVID-19”) and has since spread worldwide, including to the Unites States,

posing public health risks that have reached pandemic proportions (the “COVID-19 Pandemic”).

The COVID-19 Pandemic poses a

threat to the health and economic wellbeing of our employees, customers and vendors.

Like most businesses world-wide, the COVID-19 Pandemic

has impacted the Company financially;

In December 2019, an outbreak of a novel strain of

coronavirus originated in Wuhan, China (“COVID-19”) and has since spread worldwide, including to the Unites States, posing

public health risks that have reached pandemic proportions (the “COVID-19 Pandemic”).

The COVID-19 Pandemic poses a threat

to the health and economic wellbeing of our employees, customers and vendors.

Like most businesses world-wide, the COVID-19 Pandemic has

impacted the Company financially;

however, management cannot presently predict the scope and severity with which COVID-19 will impact

our business, financial condition, results of operations and cash flows.

SIGNIFICANT POLICIES

This summary of significant accounting policies of Skinvisible

is presented to assist in understanding the Company’s consolidated financial statements.

The consolidated financial statements

and notes are representations of the Company’s management, who are responsible for

their integrity and objectivity.

These accounting policies conform to accounting principles generally accepted in the United States of

America and have been consistently applied in the preparation of the consolidated financial statements.

Principles of consolidation –

The consolidated financial statements include the accounts of the Company and its subsidiary Skinvisible Pharmaceuticals Inc.

significant intercompany balances and transactions have been eliminated.

Use of estimates –

The preparation

of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America

requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of

contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and

expenses during the reporting period.

SUMMARY OF SIGNIFICANT

summary of significant accounting policies of Skinvisible Inc.

is presented to assist in understanding the Company’s consolidated

financial statements.

The consolidated financial statements and notes are representations of the Company’s management, who

are responsible for their integrity and objectivity.

These accounting policies conform to accounting principles generally accepted

in the United States of America and have been consistently applied in the preparation of the consolidated financial statements.

Principles of consolidation

The consolidated

financial statements include the accounts of the Company and its subsidiary Skinvisible Pharmaceuticals Inc.

All significant intercompany

balances and transactions have been eliminated.

Use of estimates

The preparation of

consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets

and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting

Actual results could differ from those estimates.

Significant estimates include estimates

used to review the Company’s, impairments and estimations of long-lived assets, allowances for uncollectible accounts, inventory

valuation, and the valuations of non-cash capital stock issuances.

The Company bases its estimates on historical experience and

on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making

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

Actual results

may differ from these estimates under different assumptions or conditions.

Cash and cash equivalents –

purposes of the statement of cash flows, the Company considers all highly liquid investments and short-term instruments with original

maturities of three months or less to be cash equivalents.

Accounting for Derivatives - The Company evaluates

all of its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.

For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair

value and is then re-valued at each reporting date, with changes in the fair value reported in the statements of operations.

For stock-based

derivative financial instruments, the Company uses a Binomial lattice pricing model to value the derivative instruments at inception

and on subsequent valuation dates.

The classification of derivative instruments, including

whether such instruments should be recorded as liabilities or as equity, is evaluated at the end of each reporting period.

instrument liabilities are classified in the balance sheet as current or non-current based on whether or not net-cash settlement of the

derivative instrument could be required within 12 months of the balance sheet date.

Significant estimates include estimates used to review the Company’s,

impairments and estimations of long-lived assets, allowances for uncollectible accounts, inventory valuation, and the valuations of non-cash

capital stock issuances.

The Company bases its estimates on historical experience and on various other assumptions that are believed to

be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities

that are not readily apparent from other sources.

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

and cash equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investments and short-term

instruments with original maturities of three months or less to be cash equivalents.

Fair Value of financial instruments

–The carrying value of cash, accounts payable and accrued expenses, and debt approximate their fair values because of the

short-term nature of these instruments.

Management believes the Company is not exposed to significant interest or credit risks

arising from these financial instruments.

The carrying amount of the Company’s convertible debt is also stated at a fair

value since the stated rate of interest approximates market rates.

Fair value is defined as the exchange price

that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market

for the asset or liability in an orderly transaction between market participants on the measurement date.

Valuation techniques

used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs.

The Company utilizes

a fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable.

carrying value of cash, accounts payable and accrued expenses, and debt approximate their fair values because of the short-term nature

of these instruments.

Management believes the Company is not exposed to significant interest or credit risks arising from these financial

The carrying amount of the Company’s convertible debt is also stated at a fair value of $ 4,587,284 since the stated

rate of interest approximates market rates.

Fair value is defined as the exchange price that would

be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or

liability in an orderly transaction between market participants on the measurement date.

Valuation techniques used to measure fair value

maximize the use of observable inputs and minimize the use of unobservable inputs.

The Company utilizes a fair value hierarchy based on

three levels of inputs, of which the first two are considered observable and the last unobservable.

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

7 unchanged sentences

Level 3 Unobservable inputs, where there is little or no market activity for the asset or liability.

These inputs reflect the reporting entity’s own beliefs about the assumptions that market participants would use in pricing the asset or liability, based on the best information available in the circumstances.

The Company did not rely on any Level 3 measurements for any of its transactions in the periods included in these financial statements.

Financial assets and liabilities measured at fair value on

a recurring basis are summarized below as of March 31, 2021:

Financial assets and liabilities measured at fair

value on a recurring basis are summarized below as of June 30, 2021:

Derivative Financial Instruments

March 31, 2021, the Company’s used the following assumptions to value the derivative liabilities using the for Binomial -Lattice

valuation model.

Stock price was $0.11, term 0.50 years, risk-free discount rate of 0.16% and volatility of 110.66%

The following table provides a summary

of the changes in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value

on a recurring basis using significant unobservable inputs:

Balance December 31, 2020

Change in fair market value of derivative liabilities

Balance March 31, 2021

Revenue recognition –

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:

As of June 30, 2021, the Company’s used the

following assumptions to value the derivative liabilities using the for Binomial-Lattice valuation model.

Stock price was $0.16,

term 0.25 years, risk-free discount rate of 0.25% and volatility of 363.08%

The following table provides a summary of the changes

in fair value, including net transfers in and/or out, of the derivative financial instruments, measured at fair value on a recurring basis

using significant unobservable inputs:

December 31, 2020

reclassed to additional paid in capital

in fair market value of derivative liabilities

Balance June 30, 2021

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;

(ii) identify the performance obligations

in the contract;

(ii) identify the performance obligations in the contract;

(iii) determine the transaction price;

(iv) allocate the transaction price;

and (v) recognize revenue when or

as the entity satisfied a performance obligation.

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 when no further contingencies

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

and (v) recognize revenue when or as the entity satisfied

a performance obligation.

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.

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

Revenue from royalty sales is recognized at the point of time in which sales occur which is determined by the receipt of royalty

Distribution 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 payments.

distribution and license rights is recognized immediately meeting milestones and once the Company is reasonably assured of payment.

The Company has made an accounting policy election

to exclude from the measurement of the transaction price all taxes assessed by governmental authorities that are collected by the

Company from its customers (sales and use taxes, value added taxes, some excise taxes).

Accounts Receivable –

receivable is comprised of uncollateralized customer obligations due under normal trade terms requiring payment within 30 days

from the invoice date.

to exclude from the measurement of the transaction price all taxes assessed by governmental authorities that are collected by the Company

from its customers (sales and use taxes, value added taxes, some excise taxes).

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

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, 2021 and December

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

compensation - T he Company records

stock based compensation in accordance with the guidance in ASC Topic 505 and 718 which requires the Company to recognize expenses related

to the fair value of its employee stock option awards.

This eliminates accounting for share-based compensation transactions using intrinsic

value and requires instead that such transactions be accounted for using a fair-value-based method.

The Company recognizes the cost of

all share-based awards on a graded vesting basis over the vesting period of the award.

The Company accounts for equity instruments

issued in exchange for the receipt of goods or services from other than employees in accordance with ASC 718-10 and the conclusions reached

by the ASC 505-50.

Costs are measured at the estimated fair market value of the consideration received or the estimated fair value of

the equity instruments issued, whichever is more reliably measurable.

The value of equity instruments issued for consideration other

than employee services is determined on the earliest of a performance commitment or completion of performance by the provider of goods

or services as defined by ASC 505-50.

Earnings (loss) per share –

reports earnings (loss) per share in accordance with FASB Codification Topic ASC 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 quarter ending

March 31, 2021, 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 30,779,400 additional shares issuable in connection with outstanding options, warrants,

stock payable and convertible debts as of March 31, 2021.

The shares issuable under each instrument is as follows;

100,000 shares issuable

for options, 60,000 shares issuable for warrants, and 30,619,400 shares issuable under convertible notes.

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, 2021 and December 31, 2020, the Company had not recorded

a reserve for doubtful accounts.

Intangible assets

The Company follows Financial Accounting Standard Board’s (FASB) Codification Topic 350-10 (“ASC 350-10”), “ Intangibles

– Goodwill and Other ”.

According to this statement, intangible assets with indefinite lives are no longer subject to amortization,

but rather an annual assessment of impairment by applying a fair-value based test.

ASC 350-10, the carrying value of assets are calculated at the lowest level for which there are identifiable cash flows.

Stock-based compensation

The Company follows the

guidelines in FASB Codification Topic ASC 718-10 “ Compensation-Stock Compensation ”, which requires the measurement

and recognition of compensation expense for all share-based payment awards made to employees and directors including employee stock options

and employee stock purchases related to an Employee Stock Purchase Plan based on the estimated fair values.

(loss) per share

The Company reports earnings (loss) per share in accordance with FASB Codification Topic ASC 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 year ending December 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 30,779,400 additional shares issuable in connection with outstanding

options, warrants, stock payable and convertible debts as of June 30, 2021.

shares issuable under each instrument is as follows;

100,000 shares issuable for options, 60,000 shares issuable for warrants, and 30,619,400

shares issuable under convertible notes.

Recently issued accounting pronouncements

The Company has evaluated all other recent accounting pronouncements and believes that none of them will have a material

effect on the Company's financial position, results of operations or cash flows.

AND OTHER ASSETS

Patents and trademarks and other intangible

assets are capitalized at their historical cost and are amortized over their estimated useful lives.

As of March 31, 2021, intangible

assets total $261,726, net of $115,846 of accumulated amortization.

5, 2020, the FASB issued ASU 2020-06, “Debt –

Debt With Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic

815-40) which eliminated several legacy accounting models to simplify the accounting for convertible instruments.

In addition, the ASU

modified the derivative scope exception guidance to remove certain criteria and clarify others, which likely will result in more instruments

being equity classified or having more embedded features remain embedded.

ASU 2020-06 is effective for public companies during interim

and annual reporting periods beginning after December 15, 2021.

INTANGIBLE AND OTHER

Patents and trademarks and other

intangible assets are capitalized at their historical cost and are amortized over their estimated useful lives.

As of June 30, 2021,

intangible assets total $ 282,590 ,

net of $ 120,144

of accumulated amortization.

As of December 31, 2020, intangible assets total $ 261,726 ,

net of $111,596 of accumulated amortization.

Amortization expense for the three months ended March 31,

2021 and 2020 was $4,251 and $9,720, respectively.

net of $ 111,596

of accumulated amortization.

Amortization expense for the six months ended

June 30, 2021 and 2020 was $ 8,548 and $ 19,681 , 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 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, 2021.

RELATED PARTY

During the three months ended March 31, 2021 and 2020,

$0 and $22,000 was advanced by an officer and $7,616 and $0 was repaid, respectively .

As of March 31, 2021 and December 31, 2020, $52,499 and

$52,499 in advances remained due to officers of the company, respectively.

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 June 30, 2021.

RELATED PARTY TRANSACTIONS

During the six months ended June 30, 2021

and 2020, $ 0 and $ 27,000 was advanced by an officer and $ 200 and $ 15,000 was repaid, respectively .

As of June 30, 2021 and December 31, 2020,

$ 52,299 and $ 52,499 in advances remained due to officers of the company, respectively.

All other related party notes have been extinguished

or re-negotiated as convertible notes.

Convertible Notes Related

(See note 9 for additional details.)

Convertible Notes Related Party

Convertible Notes Payable Related Party consists of the following:

March 31, 2021

June 30, 2021

December 31, 2020

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 convertible 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 date.

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 % .

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 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 associated with these notes has been accreted and charged to interest expenses as a financing expense in the amount of $105,880 during the year ended March 31, 2021 and 2020, respectively.

$ 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 $ 105,590 and $ 304,926 during the six months ended June 30, 2021 and 2020,

respectively.

Unamortized debt discount

( 2,447,770 )

Total, net of unamortized discount

1 unchanged sentence

Secured debt offering

During the period from May 22, 2013

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

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:

During the period from May 22, 2013 and December

31, 2018, the Company entered into a 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:

US patent number #8,128,913:

"Sunscreen Composition with Enhanced UV-A Absorber Stability and

Methods.”

As of March 31, 2021, $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.”

During the three months ended June 30, 2021,

the Company entered to settlement agreements to settle various notes.

As part of the settlement the principal balance of the note was

settled for cash and all interest due through the date of settlement was forgiven.

As of June 30, 2021, the Company has recorded a gain

on settlement of the debt of $ 38,375

associated with the settlement of $ 65,900

of principal.

As of June 30, 2021, $ 486,100 of the outstanding

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

NOTES PAYABLE

1 unchanged sentence

$ 40,000 face value 9 % secured notes payable to investors, due in 2015.

At the investor’s option until the repayment date, the note and related interest may be converted to shares of the Company’s common stock a discount of 90% of the current share price after the first anniversary of the note.

The notes are secured by the accounts receivable of a license agreement the Company has with Womens Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®.

At the investor’s option until the repayment date, the note and related interest may be converted to shares of the Company’s common stock a discount of 90 % of the current share price after the first anniversary of the note.

The notes are secured by the accounts receivable of a license agreement the Company has with Womens Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®.

The notes have reached maturity and are now in default, under the notes default provisions the entire balance is now due upon demand.

The Company evaluated the conversion feature of the note and concluded that it represents an embedded derivative.

As of March 31, 2021,

the fair value of the derivative is $7,358.

As of June 30, 2021, the fair value of the derivative is $ 49,205 .

The Company determined the derivative was immaterial as of December 31, 2020.

The notes have

reached maturity and are now in default, under the notes default provisions the entire balance is now due upon demand.

The notes have reached maturity and are now in default, under the notes default provisions the entire balance is now due upon demand.

Original issue discount

1 unchanged sentence

Total, net of unamortized discount

On October 26, 2015 the Company

issued a $135,000 face value 9% unsecured notes payable to investors, due October 26, 2017.

At the investor’s option until the

repayment date, the note and related interest may be converted to shares of the Company’s common stock a discount of 90% of

the current share price after the first anniversary of the note.

The notes are secured by the accounts receivable of a license

agreement the Company has with Womens Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®.

evaluated the conversion feature of the note and concluded that it represents an embedded derivative.

As of March 31, 2021, the fair

value of the derivative is $24,834.

The Company determined the derivative was immaterial as of December 31, 2020.

On October 26, 2015 the Company issued a $ 135,000 face value 9 % unsecured notes payable to investors, due October 26, 2017 .

At the investor’s option until the repayment date, the note and related interest may be converted to shares of the Company’s common stock a discount of 90 % of the current share price after the first anniversary of the note.

The notes are secured by the accounts receivable of a license agreement the Company has with Womens Choice Pharmaceuticals, LLC on its proprietary prescription product, ProCort®.

The note has reached maturity and is in default.

The Company evaluated the conversion feature of the note and concluded that it represents an embedded derivative.

During the three months ended June 30, 2021, the Company made payments of $ 50,000 on the balance of the note.

The fair value of the embedded derivative associated with the payments was $ 43,305 and was recorded to additional paid in capital.

As of June 30, 2021, the fair value of the derivative is $ 104,561 .

The Company determined the derivative was immaterial as of December 31, 2020.

The note has reached maturity and is now in default, under the notes default provisions the entire balance is now due upon demand.

Unamortized debt discount

Total, net of unamortized discount

On February 17, 2016, the Company

entered into a convertible promissory note pursuant to which it borrowed $20,000.

Interest under the convertible promissory note is

9% per annum, and the principal and all accrued but unpaid interest is due on February 17, 2018.

The note is convertible at any time

following 90 days after the issuance date at noteholders option into shares of our common stock at a variable conversion price of

90% of the average five day market price of our common stock during the 5 trading days prior to the notice of conversion, subject to

adjustment as described in the note.

The holder’s ability to convert the note, however, is limited in that it will not be

permitted to convert any portion of the note if the number of shares of our common stock beneficially owned by the holder and its

affiliates, together with the number of shares of our common stock issuable upon any full or partial conversion, would exceed 4.99%

of the Company’s outstanding shares of common stock.

The Company evaluated the conversion feature of the note and concluded

that it represents an embedded derivative.

As of March 31, 2021, the fair value of the derivative is $3,679.

The Company determined

the derivative was immaterial as of December 31, 2020.

On February 17, 2016, the Company entered into a convertible promissory note pursuant to which it borrowed $ 20,000 .

Interest under the convertible promissory note is 9 % per annum, and the principal and all accrued but unpaid interest is due on February 17, 2018 .

The note is convertible at any time following 90 days after the issuance date at noteholders option into shares of our common stock at a variable conversion price of 90 % of the average five day market price of our common stock during the 5 trading days prior to the notice of conversion, subject to adjustment as described in the note.

The holder’s ability to convert the note, however, is limited in that it will not be permitted to convert any portion of the note if the number of shares of our common stock beneficially owned by the holder and its affiliates, together with the number of shares of our common stock issuable upon any full or partial conversion, would exceed 4.99% of the Company’s outstanding shares of common stock .

The note has reached maturity and is in default.

The Company evaluated the conversion feature of the note and concluded that it represents an embedded derivative.

As of June 30, 2021, the fair value of the derivative is $ 24,603 .

The Company determined the derivative was immaterial as of December 31, 2020.

The notes have reached maturity and are now in default, under the notes default provisions the entire balance is now due upon demand.

Unamortized debt discount

Total, net of unamortized discount

On August 11, 2016, the Company

entered into a convertible promissory note pursuant to which it borrowed $15,000.

Interest under the convertible promissory note is

9% per annum, and the principal and all accrued but unpaid interest is due on August 11, 2018.

The note is convertible into shares

of our common stock at a variable conversion price of 90% of the average market price of our common stock during the 5 trading days

prior to the notice of conversion, subject to adjustment as described in the note.

The Company evaluated the conversion feature of

the note and concluded that it represents an embedded derivative.

As of March 31, 2021, the fair value of the derivative is $2,759.

The Company determined the derivative was immaterial as of December 31, 2020.

On August 11, 2016, the Company entered into a convertible promissory note pursuant to which it borrowed $ 15,000 .

Interest under the convertible promissory note is 9 % per annum, and the principal and all accrued but unpaid interest is due on August 11, 2018.

The note is convertible into shares of our common stock at a variable conversion price of 90 % of the average market price of our common stock during the 5 trading days prior to the notice of conversion, subject to adjustment as described in the note .

The note has reached maturity and is in default.

The Company evaluated the conversion feature of the note and concluded that it represents an embedded derivative.

During the three months ended June 30, 2021, the Company made payments of $ 15,000 on the balance of the note and the note was paid in full.

The fair value of the embedded derivative associated with the payments was $ 10,000 and was recorded to additional paid in capital.

Unamortized debt discount

3 unchanged sentences

The note has reached maturity and is in default.

The Company evaluated the conversion feature of the note and concluded that it represents an embedded derivative.

As of March 31, 2021, the fair value of the derivative is $1,840.

The Company determined the derivative was immaterial as of December 31, 2020 The note has reached maturity and is in default.

As of June 30, 2021, the fair value of the derivative is $ 12,301 .

The Company determined the derivative was immaterial as of December 31, 2020.

The notes have reached maturity and are now in default, under the notes default provisions the entire balance is now due upon demand.

Unamortized debt discount

3 unchanged sentences

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

The aggregate beneficial conversion feature has been accreted and charged to interest expenses in the amount of $12,534 and $12,674 for the three months ended March 31, 2021 and 2020, respectively.

The aggregate beneficial conversion feature has been accreted and charged to interest expenses in the amount of $ 25,208 and $ 25,348 for the six months ended June 30, 2021 and 2020, respectively.

Unamortized debt discount

3 unchanged sentences

Total long-term convertible notes

determined the derivative liability of the options using the Binomial model.

The variables used for the Binomial model as of March 31, 2021 are as

listed below:

Risk free interest rate

Expected term (years)

Expected volatility

AND CONTINGENCIES

License Agreement

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 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.

COMMITMENTS AND CONTINGENCIES

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, 2019.

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 on September

on January 27, 2021 the companies agreed to revise the milestone payments due under the agreement and to extend the agreement

indefinitely.

The milestones have not been reached as of March 31, 2021.

licensing fee has not been accrued due to the uncertainty of its collection.

On February 3, 2020, we entered into a License Agreement with Ovation

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 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 additional assignment rights for

its hand sanitizer products in exchange for $100,000.

STOCK OPTIONS

The following is a summary of option activity during the

three months ended March 31, 2021.

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 on September 30, 2020 and

on January 27, 2021 the companies agreed to revise the milestone payments due under the agreement and to extend the agreement indefinitely.

On June 14, 2021, the Company entered

into an amendment to change the terms of the license Fee as shown below.

consideration for the rights conveyed by Skinvisible under this Agreement, Licensee agrees to pay to Skinvisible a one-time, non-refundable,

non-creditable license issue fee of one million USD dollars (USO $1,000,000) (''License Fee'').

To date, Licensee has paid three hundred

ninety-two thousand five hundred US dollars (USD $392,500) of this fee as part of the First Half Payment of the License Fee , $125,000

of which was paid in the year ending December 31, 2020 and $267,500 in the six months ended June 30, 2021 .

The balance due of the

First Half Payment is one hundred seven thousand five hundred US dollars (USD $107,500) which was received on July 7, 2021.

payment of two hundred and fifty thousand dollars ($250,000) is due no later than ten (10) business days after receipt by Licensee of

additional funding from Altium Capital which coincides with the approval from the SEC on Quoin’s merger with a NASDAQ listed company,

expected in September.

The remaining balance of two hundred and fifty thousand dollars ($250,000) will be paid on December 31, 2021.

of June 30, 2021the Company has recognized $392,500 under the agreement including $267,500 during the six months ended June 30, 2021.

The balance of licensing fee has not yet been recognized as it is not yet probable that substantially all of the consideration will be

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

pursuant to which Skinvisible granted to Ovation Science

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

In exchange for the license, Ovation

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 additional assignment rights for its hand sanitizer products in exchange for $100,000.

STOCK OPTIONS AND

The following is a summary of option activity during the six months

ended June 30, 2021.

Number of Shares

5 unchanged sentences

Options exercised

Balance, March 31, 2021

As of March 31, 2021, all stock options outstanding are

Balance, June 30, 2021

As of June 30, 2021, all stock options outstanding are exercisable.

Stock warrants -

The following is a summary of warrants activity

during the year ended March 31, 2021.

Number of Shares

Weighted Average Exercise Price

The following is a summary of warrants activity during

the year ended June 30, 2021.

Average Exercise Price

Balance, December 31, 2020

3 unchanged sentences

Warrants exercised

Balance, March 31, 2021

As of March 31, 2021, all stock warrants outstanding are

STOCKHOLDERS’

The Company is authorized to issue 200,000,000

shares of $0.001 par value common stock.

The Company had 4,539,843 and 4,539,843 issued and outstanding shares of common stock

as of March 31, 2021 and December 31, 2020, respectively.

In accordance with ASC Topic 855-10, the Company has analyzed its

operations subsequent to March 31, 2021 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.

Management’s

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”

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

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

“project,”

“expects,”

“anticipates,”

“estimates,”

“intends,”

“strategy,”

“plan,”

“may,”

“will,”

“would,”

“will be,”

“will continue,”

“will likely

result,”

and similar expressions.

We intend such forward-looking statements to be covered by the safe-harbor provisions for

forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and are including this statement

for purposes of complying with those safe-harbor provisions.

Forward-looking statements are based on current expectations and assumptions

that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements.

Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain.

Factors which could

have a material adverse affect on our operations and future prospects on a consolidated basis include, but are not limited to:

changes in economic conditions, legislative/regulatory changes, availability of capital, interest rates, competition, and generally

accepted accounting principles.

These risks and uncertainties should also be considered in evaluating forward-looking statements

and undue reliance should not be placed on such statements.

We undertake no obligation to update or revise publicly any forward-looking

statements, whether as a result of new information, future events or otherwise.

Further information concerning our business, including

additional factors that could materially affect our financial results, is included herein and in our other filings with the SEC.

The full extent of the impact of the COVID-19 pandemic

on our business, operations and financial results will depend on numerous evolving factors that we may not be able to accurately

predict at the present time.

In an effort to contain COVID-19 or slow its spread, governments around the world have enacted various

measures, including orders to close all businesses not deemed “essential,”

isolate residents to their homes or places

of residence, and practice social distancing when engaging in essential activities.

We anticipate that these actions and the global

health crisis caused by COVID-19 will negatively impact business activity across the globe.

While we have not observed any noticeable

impact on our revenue related to these conditions in the past fiscal year, or through the date of this filing, we cannot estimate

the impact COVID-19 will have in the future as business and consumer activity decelerates across the globe.

We will continue to actively monitor the situation and

may take further actions that alter our business operations as may be required by federal, state, local or foreign authorities,

or that we determine are in the best interests of our employees, customers, partners and stockholders.

It is not clear what the

potential effects any such alterations or modifications may have on our business, including the effects on our customers, partners,

or vendors, or on our financial results.

Recent Developments

On October 17, 2019, we entered an Exclusive License

Agreement with Quoin Pharmaceuticals, Inc., a Delaware corporation (“Quoin”) pursuant to which we 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 us a license fee of $1,000,000 (the “License Fee”) 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 us upon achieving regulatory approval milestones for certain drug products.

The agreement was 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 and again on July 31, 2020 the companies agreed to extend the Exclusive

License Agreement under the same terms to expire on September 30, 2020, and on January 27, 2021 the companies agreed to revise

the milestone payments due under the agreement and to extend the agreement indefinitely.

As of March 31, 2021, we have received

$125,000 in licensing fee income per this agreement.

On February 3, 2020, we entered into a License Agreement with Ovation

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 royalty percentage

on all net sales on the licensed products subject to adjustment in certain situations plus a license fee of $100,000 payable in year

3 of the agreement if it chooses to continue the license.

On June 10, 2020, the company exercised its rights and paid the $100,000 license

Results of Operations for the Three Months Ended March 31, 2021

Our revenue, which we combine from product sales,

royalties on patent licenses and license fees (product development fees), was $12,051 for the three months ended March 31, 2021,

a decrease from $16,052 for the same period ended March 31, 2020.

The revenue for both periods was mainly from license

fees, but we did have some product sales in the 2021 quarter.

We hope to generate more revenues from our licenses with Quoin and

Ovation for the rest of the year.

We had $3,300 in cost of revenues for the

three months ended March 31, 2021, as compared with no cost of revenues for the same period ended 2020, so our gross profit was

$8,751 for the three months ended March 31, 2021, as compared with gross profit of $16,052 for the three months ended March 31,

We had some product sales resulting in a reduced

gross profit for 2021 as compared with 2020.

We hope that our gross profit increases in 2021 with more revenues from our licenses

with Quoin and Ovation expected for the rest of the year, which do not have a cost of revenue component.

Operating Expenses

Operating expenses decreased to $119,878 for the

three months ended March 31, 2021 from $146,044 for the same period ended March 31, 2020.

Our operating expenses for the three months

ended March 31, 2021 consisted mainly of accrued salaries and wages of $87,942, audit and accounting of $13,610, and amortization

In comparison, 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 of $9,719.

Other Expenses

We had other expenses of $324,378 for the three months ended March

31, 2021, as compared with other expenses of $300,092 for the three months ended March 31, 2020.

The increase in other expenses was primarily

a result of a loss on change od derivative liability in the amount of $40,471.

We expect to experience high debt payments in the future as a

result of our outstanding liabilities.

Moreover, as of the date of this report, there are a number of secured promissory notes with an

aggregate principal amount of approximately $772,000 that have matured.

In addition, we also have one unsecured promissory note with an

aggregate principal amount of $10,000 that has matured.

If we are unable to generate sufficient revenues and/or additional financing to

service this debt, there is a risk the lenders will call the notes, secure our assets, as to those applicable secured notes, and demand

If this happens, we could go out of business.

We recorded a net loss of $435,505 for the three months ended

March 31, 2021, as compared with a net loss of $430,084 for the three months ended March 31, 2020.

Liquidity and Capital Resources

As of March 31, 2021, we had total current assets of $22,417 and

total assets in the amount of $168,746.

Our total current liabilities as of March 31, 2021 were $2,957,995.

We had a working capital deficit

of $2,935,578 as of March 31, 2021, compared with a working capital deficit of $2,668,871 as of December 31, 2020.

Operating activities used $16,116 in cash for the three months

ended March 31, 2021, as compared with $15,849 used for the three months ended March 31, 2020.

Our negative operating cash flow for each

period was largely the result of our net losses for those periods, offset by adjustments to amortization of debt discount and increases

in accrued interest.

We used cash of $0 and $870 in investing activities for the three

months ended March 31, 2021 and 2020, respectively, for the purchase of fixed and intangible assets.

Cash flows used by financing activities during the three months

ended March 31, 2021 amounted to $7,616, as compared with cash provided of $22,000 for the three months ended March 31, 2021.

flow for the three months ended March 31, 2021 consisted of repayments of related party loans.

Our cash flow for the three months ended

March 31, 2020 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.

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 –

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 $35,135,913 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

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, 2021, 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.

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 –

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.

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 –

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 –

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

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, 2021, we had not

recorded a reserve for doubtful accounts.

We have $175,000in 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 flow.

Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company is not required to provide

the information required by this Item.

Balance, June 30, 2021

As of June 30, 2021, all stock warrants outstanding are exercisable.

STOCKHOLDERS’

The Company is authorized to issue 200,000,000 shares

of $ 0.001 par value common stock.

The Company had 4,539,843 and 4,539,843 issued and outstanding shares of common stock as of June 30,

2021 and December 31, 2020, respectively.

SUBSEQUENT EVENTS

In accordance with ASC Topic 855-10, the Company has analyzed its operations

subsequent to June 30, 2021 to the date these financial statements were available to be issued and has determined that it does not have

any material subsequent events to disclose in these financial statements.

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