What changed in this filing

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Item 7. Management’s Discussion and Analysis

2024-04-16 compared with 2023-03-30 · 142 added, 155 removed, 5 unchanged (98% of the section changed)

Management’s Discussion and Analysis of Financial Condition

and Results of Operations

Forward-Looking Statements

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.” 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.

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

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.

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.

Results of Operations for the Years Ended December 31, 2022 and 2021

Our revenue, which we combine from product sales, royalties on patent licenses

and license fees (product development fees), was $279,296for the year ended December 31, 2022, an decrease from $663,426 for the same

period ended December 31, 2021.

The revenue for 2022 was mainly from license fees with Quoin and the revenue

for 2021 was mainly from license fees with Quoin and Ovation.

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

We had $4,808 in cost of revenues for the year ended December 31, 2022,

as compared with $3,300 in cost of revenues for the year ended December 31, 2021, so our gross profit was $274,488, or 98% of sales for

2022 and $660,126, or 99% of sales for 2021.

Our gross profit decreased in 2022 due to less revenues from our license

with Quoin, We hope to generate more revenues from our licenses with Quoin and Ovation in2023.

Management’s Discussion and Analysis of Financial Condition and Results of Operations Forward-Looking Statements

quarterly report contains forward-looking statements.

Forward-looking statements are projections of events, revenues, income, future

economic performance or management’s plans and objectives for our future operations.

In some cases, you can identify forward-looking

statements by terminology such as “may”, “should”, “expects”, “plans”, “anticipates”,

“believes”, “estimates”, “predicts”, “potential” or “continue” or the negative

of these terms or other comparable terminology.

These statements are only predictions and involve known and unknown risks, uncertainties

and other factors, including the risks in the section entitled “Risk Factors” and the risks set out below, any of which may

cause our or our industry’s actual results, levels of activity, performance or achievements to be materially different from any

future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

include, by way of example and not in limitation:

uncertainty of profitability based upon our history of losses;

• legislative

or regulatory changes concerning skincare research and therapies;

related to failure to obtain adequate financing on a timely basis and on acceptable terms

to continue as going concern;

related to our operations and uncertainties related to our business plan and business strategy;

in economic conditions;

• uncertainty

with respect to intellectual property rights, protecting those rights and claims of infringement

of other’s intellectual property;

• competition;

• cybersecurity

list is not an exhaustive list of the factors that may affect any of our forward-looking statements.

These and other factors should

be considered carefully, including those contained in this Annual Report under “Risk Factors,” and readers should not

place undue reliance on our forward-looking statements.

Forward looking statements are made based on management’s beliefs,

estimates and opinions on the date the statements are made, and we undertake no obligation to update forward-looking statements if

these beliefs, estimates and opinions or other circumstances should change.

Although we believe that the expectations reflected in

the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

Except as required by

applicable law, including the securities laws of the United States, we do not intend to update any of the forward- looking statements

to conform these statements to actual results.

financial statements are stated in United States dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting

of Operations for the Years Ended December 31, 2023 and 2022

revenue, which we combine from product sales, royalties on patent licenses and license fees (product development fees), was $20,000 for

the year ended December 31, 2023, a decrease of $259,296 from $279,296 for the same period ended December 31, 2022.

The 20,000 in revenue for the year ended December

31, 2023, was primarily the result of licensing fees.

We had $0 in cost of revenues

for the year ended December 31, 2023, as compared with $4,808 in cost of revenues for the year ended December 31, 2022, so our gross profit

was 20,000, or 100% of sales for 2023 and $274,488, or 98% of sales for 2022.

Our gross profit in 2023 was due to

licensing revenue, and we hope to generate more revenues from our licenses with Quoin and Ovation for the rest of 2024.

Operating Expenses

Operating expenses decreased to $512,919 for the year ended December 31,

2022 from $472,046 for the same period ended December 31, 2021.

Our operating expenses for all periods consisted mainly of selling, general

and administrative expenses.

Our selling, general and administrative expenses for the year December

31, 2022 consisted mainly of accrued salaries and wages of $328,769 and audit and accounting of $53,638.

In comparison, our selling, general

and administrative expenses for the year ended December 31, 2021 consisted mainly of accrued salaries and wages of $316,769, audit and

accounting of $49,712.

Other Expenses

We had other expenses of $986,455 for the year ended December 31, 2022,

as compared with other expenses of $1,260,833 for the year ended December 31, 2021.

Our other expenses for the year ended December 31, 2022

consisted mainly of interest expense, netted against a gain on forgiveness of debt and gain on derivative liability changes.

expenses for the year ended December 31, 2021 consisted mainly of interest expense and a loss on the changes in derivative liability,

offset by a gain on the settlement of debt.

We recorded a net loss of $1,224,887 for the year ended December 31, 2022,

as compared with a net loss of $1,072,753 for the year ended December 31, 2021.

Liquidity and Capital Resources

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.

The Company has incurred cumulative net losses of $36,998,048 since its inception and requires capital for its contemplated operational

and marketing activities to take place.

The Company’s ability to generate the necessary funds through licensing of its core products

or the ability to 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.

These factors, among others, raises substantial doubt about

the Company’s ability to continue as a going concern.

The consolidated financial statements of the Company do not include any adjustments

that may result from the outcome of these aforementioned uncertainties.

As of December 31, 2022, we had total current assets of $109,946

and total assets in the amount of $246,793.

Operating expenses decreased to

$510,375 for the year ended December 31, 2023, from $512,919 for the same period ended December 31, 2022.

operating expenses for all periods consisted mainly of selling, general and administrative expenses.

selling, general and administrative expenses for the year December 31, 2023, consisted mainly of accrued salaries and wages of $356,272

and audit and accounting of $40,638.

In comparison, Our selling, general and administrative expenses for the year December 31, 2022 consisted

mainly of accrued salaries and wages of $328,769 and audit and accounting of $53,638.

had other expenses of $1,892,065 for the year ended December 31, 2023, as compared with other expenses of

for the year ended December 31, 2022.

other expenses for the year ended December 31, 2023, consisted mainly of interest expense, netted against a gain on settlement of debt

and gain on derivative liability changes.

Our other expenses for the year ended December 31, 2022 consisted mainly of interest expense,

netted against a gain on forgiveness of debt and gain on derivative liability changes.

We recorded a net loss of $2,382,440

for the year ended December 31, 2023, as compared with a net loss of $1,224,887 for the year ended December 31, 2022.

and Capital Resources

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.

The Company has incurred cumulative net losses of $39,380,488 since its inception and requires

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

The Company’s ability to generate the necessary

funds through licensing of its core products or the ability to 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.

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

The consolidated financial

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

As of December 31, 2023, we had total

current assets of $35,460 and total assets in the amount of $162,869.

Our total current liabilities as of December 31, 2023, were $3,512,407.

We had a working capital

deficit of $3,535,040 as of December 31, 2022, compared with a working capital deficit of $2,987,049 as of December 31, 2022.

Operating activities provided $45,170 in cash for the year ended

December 31, 2022, as compared with $374,605 provided for the year ended December 31, 2021.

Our positive operating cash flows for 2022

and 2021 was largely the result of changes in operating assets and liabilities, amortization of debt discount offset mainly by the net

loss for the periods.

We used cash of $2.530 and $20,864 in investing activities for

the years ended December 31, 2022 and 2021, respectively, for the purchase of fixed and intangible assets.

Cash flows used by financing activities during the year ended December

31, 2022 amounted to $27,299, as compared with cash used of $323,600 for the year ended December 31, 2021.

Our negative financing cash

flow for the year ended December 31, 2022 resulted from payments on related party loans.

Our negative financing cash flow for the year

ended December 31, 2021 resulted from the repayments of debt.

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 addition

Off Balance Sheet Arrangements

As of December 31, 2022, 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 – 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.

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

We had a working capital deficit of $3,476,947 as of December 31, 2023, compared with a working capital deficit of $3,535,040 as of December

activities used $75,969 in cash for the year ended December 31, 2023, as compared with $45,170 provided for the year ended December 31,

Our negative operating cash flows for 2023 was the result of our net loss for the year, mainly offset by changes in operating assets

and liabilities and the amortization of debt discount.

Our positive operating cash flows for 2022 was largely the result of changes in

operating assets and liabilities, amortization of debt discount offset mainly by the net loss for the periods.

used cash of $10,521 and $2,530 in investing activities for the years ended December 31, 2023 and 2022, respectively, for the purchase

of intangible assets.

flows provided by financing activities during the year ended December 31, 2023 amounted to $6,000, as compared with cash used of $27,299

for the year ended December 31, 2022.

Our positive financing cash flow for the year ended December 31, 2023 resulted from proceeds from

related part notes.

Our negative financing cash flow for the year ended December 31, 2022 resulted from payments on related party loans.

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

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

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 capital.

Balance Sheet Arrangements

of December 31, 2023, there were no off-balance sheet arrangements.

Accounting Policies

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.

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

Costs of 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.

Accounts Receivable – Accounts receivable

is comprised of uncollateralized customer obligations due under normal trade terms requiring payment within 30 days from the invoice date.

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.

of 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 December 31, 2022, we had not recorded a reserve for doubtful accounts.

Recently Issued Accounting Pronouncements

In August 2020, FASB issued ASU 2020-06, Accounting for Convertible Instruments

and Contracts in an Entity;

Own Equity (“ASU 2020-06”), as part of its overall simplification initiative to reduce costs and

complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial

Among other changes, the new guidance removes from GAAP separation models for convertible debt that require the convertible

debt to be separated into a debt and equity component, unless the conversion feature is required to be bifurcated and accounted for as

a derivative or the debt is issued at a substantial premium.

As a result, after adopting the guidance, entities will no longer separately

present such embedded conversion features in equity, and will instead account for the convertible debt wholly as debt.

The new guidance

also requires use of the “if-converted” method when calculating the dilutive impact of convertible debt on earnings per share,

which is consistent with the Company’s current accounting treatment under the current guidance.

The guidance is effective for financial

statements issued for fiscal years beginning after December 15, 2021, and interim periods within those fiscal years, with early adoption

permitted, but only at the beginning of the fiscal year.

The Company is currently evaluating the impact the adoption of ASU 2020-06 will

have on the Company’s financial statements.

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 December

31, 2023, we had not recorded a reserve for doubtful accounts.

Issued Accounting Pronouncements

August 2020, FASB issued ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity;

Own Equity (“ASU 2020-06”),

as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or

improving the usefulness of the information provided to users of financial statements.

Among other changes, the new guidance removes

from GAAP separation models for convertible debt that require the convertible debt to be separated into a debt and equity component,

unless the conversion feature is required to be bifurcated and accounted for as a derivative or the debt is issued at a substantial premium.

As a result, after adopting the guidance, entities will no longer separately present such embedded conversion features in equity, and

will instead account for the convertible debt wholly as debt.

The new guidance also requires use of the “if-converted” method

when calculating the dilutive impact of convertible debt on earnings per share, which is consistent with the Company’s current

accounting treatment under the current guidance.

The guidance is effective for financial statements issued for fiscal years beginning

after December 15, 2021, and interim periods within those fiscal years, with early adoption permitted, but only at the beginning of the

The Company is currently evaluating the impact the adoption of ASU 2020-06 will have on the Company’s financial statements.

Quantitative and Qualitative Disclosures About Market Risk

A smaller reporting company is not

required to provide the information required by this Item.

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-K

Item 7. Management’s Discussion and Analysis