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What changed in Sunshine Biopharma Inc.'s 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Sunshine Biopharma Inc.'s 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+144 added−174 removedSource: 10-K (2024-03-28) vs 10-K (2023-04-04)

Top changes in Sunshine Biopharma Inc.'s 2023 10-K

144 paragraphs added · 174 removed · 109 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeThe consolidated financial statements contained in this report include the results of operations of Nora Pharma from October 20, 2022 through December 31, 2022. 1 Products on the Market As a result of the acquisition of Nora Pharma we now have the following generic prescription drugs on the market in Canada: Drug Action/Indication Reference Brand Alendronate Osteoporosis Fosamax® Amlodipine Cardiovascular Norvasc® Apixaban Cardiovascular Eliquis® Atorvastatin Cardiovascular Lipitor® Azithromycin Antibacterial Zithromax® Candesartan Hypertension Atacand® Candesartan HCTZ Hypertension Atacand® Celecoxib Anti-inflammatory Celebrex® Cetirizine Allergy Reactine® Ciprofloxacin Antibiotic Cipro® Citalopram Central nervous system Celexa® Clindamycin Antibiotic Dalacin® Clopidogrel Cardiovascular Plavix® Donepezil Central nervous system Aricept® Duloxetine Central nervous system Cymbalta® Dutasteride Urology Avodart® Escitalopram Central nervous system Cipralex® Ezetimibe Cardiovascular Ezetrol® Finasteride Urology Proscar® Flecainide Cardiovascular Tambocor® Fluconazole Antifungal Diflucan® Fluoxetine Central nervous system Prozac® Hydroxychloroquine Antimalarial Plaquenil® Lacosamide Central nervous system Vimpat® Letrozole Oncology Femara® Levetiracetam Central nervous system Keppra® Mirtazapine Central nervous system Remeron® Montelukast Allergy Singulair® Olanzapine ODT Central nervous system Zyprexa® Olmesartan Cardiovascular Olmetec® Olmesartan HCTZ Cardiovascular Olmetec Plus® Pantoprazole Acid Reflux Pantoloc® Paroxetine Central nervous system Paxil® Perindopril Cardiovascular Coversyl® Pravastatin Cardiovascular Pravachol® Pregabalin Central nervous system Lyrica® Quetiapine Central nervous system Seroquel® Quetiapine XR Central nervous system Seroquel XR® Ramipril Cardiovascular Altace® Rizatriptan ODT Central nervous system Maxalt® ODT Rosuvastatin Cardiovascular Crestor® Sertraline Central nervous system Zoloft® Sildenafil Urology Viagra® Tadalafil Urology Cialis® Telmisartan Cardiovascular Micardis® Telmisartan HCTZ Cardiovascular Micardis Plus® Tramadol Acetaminophen Central nervous system Tramacet® Zolmitriptan Central nervous system Zomig® Zopiclone Central nervous system Imovane® 2 In addition, we have the following nonprescription OTC products on the market in Canada and partially in the U.S.: Product Description Essential 9 ™ Essential Amino Acids capsules (761 mg) L-Arginine L-Arginine capsules (500 mg) L-Carnitine L-Carnitine capsules (667 mg) Extreme-Mass ™ Weight Gain powder Iso-Whey™ Whey Protein powder BCAA 2:1:1™ Branched-Chain Amino Acids capsules (600 mg) L-Creatine L-Creatine Monohydrate powder Nora B12-1000 Vitamin B-12 tablets (Cyanocobalamine, 1,000 mcg) Nora Calcium Calcium Carbonate tablets (500 mg) Nora Cal-D 400 Calcium Carbonate (500 mg) + Vitamin D (400 IU) tablets Nora Cal-D 1000 Calcium Carbonate (500 mg) + Vitamin D (1,000 IU) tablets Nora D-400 Vitamin D tablets (Calciferol 400 IU) Nora D-1000 Vitamin D tablets (Calciferol 1,000 IU) Nora Senna Senna Alexandrina tablets (8.6 mg) Nora Sennosides Senna Alexandrina tablets (8.6 mg) NRA-ASA Acetylsalicylic Acid tablets (80 mg) NRA-Docusate Sodium Docusate Sodium capsules (100 mg) NRA K-20 Potassium Chloride tablets (1,500 mg) Products in Development The following table summarizes our generic and proprietary drugs in development: Generic Drugs Therapeutic Area(s) Development Stage Launch Date Group A (5 Products) Central Nervous System, Urology, Cardiovascular Under Regulatory Review 2023Q2 Group B (3 Products) Central Nervous System, Gastrointestinal Under Regulatory Review 2023Q3 Group C (1 Product) Oncology Under Regulatory Review 2023Q4 Group D (8 Products) Central Nervous System, Cardiovascular, Metabolism Under Regulatory Review 2024Q1 Group E (5 Products) Cardiovascular, Urology, Endocrinology Under Regulatory Review 2024Q2 Group F (6 Products) Urology, Cardiovascular, Oncology, Anti-infectives Under Regulatory Review 2024Q3 Proprietary Drugs Therapeutic Area Development Stage Launch Date Adva-27a (Small Molecule) Oncology (Pancreatic Cancer) IND-Enabling Studies TBD K1.1 (mRNA LNP) Oncology (Liver Cancer) Animal Testing TBD SBFM-PL4 (Small Molecule) Antiviral (COVID-19) Animal Testing TBD Proprietary Drugs in Development Adva-27a Anticancer Compound In the area of oncology, our proprietary drug development activities have been focused on the development of a small molecule called Adva-27a for the treatment of aggressive forms of cancer.
Biggest changeNora Pharma currently has 52 generic prescription drugs on the market in Canada. 1 Products on the Market Through Nora Pharma we currently have the following generic prescription drugs on the market in Canada: Drug Action/Indication Reference Brand Alendronate Osteoporosis Fosamax® Amlodipine Cardiovascular Norvasc® Apixaban Cardiovascular Eliquis® Aripiprazole Antipsychotic Abilify® Atorvastatin Cardiovascular Lipitor® Azithromycin Antibacterial Zithromax® Candesartan Hypertension Atacand® Candesartan HCTZ Hypertension Atacand Plus® Celecoxib Anti-inflammatory Celebrex® Cetirizine Allergy Reactine® Ciprofloxacin Antibiotic Cipro® Citalopram Central nervous system Celexa® Clindamycin Antibiotic Dalacin® Clopidogrel Cardiovascular Plavix® Dapagliflozin Diabetes Forxiga® Donepezil Central nervous system Aricept® Duloxetine Central nervous system Cymbalta® Dutasteride Urology Avodart® Escitalopram Central nervous system Cipralex® Ezetimibe Cardiovascular Ezetrol® Finasteride Urology Proscar® Flecainide Cardiovascular Tambocor® Fluconazole Antifungal Diflucan® Fluoxetine Central nervous system Prozac® Hydroxychloroquine Antimalarial Plaquenil® Lacosamide Central nervous system Vimpat® Letrozole Oncology Femara® Levetiracetam Central nervous system Keppra® Mirtazapine Central nervous system Remeron® Metformin Diabetes Glucophage® Montelukast Allergy Singulair® Olmesartan Cardiovascular Olmetec® Olmesartan HCTZ Cardiovascular Olmetec Plus® Pantoprazole Gastroenterology Pantoloc® Paroxetine Central nervous system Paxil® Perindopril Cardiovascular Coversyl® Pravastatin Cardiovascular Pravachol® Pregabalin Central nervous system Lyrica® Quetiapine Central nervous system Seroquel® Quetiapine XR Central nervous system Seroquel XR® Ramipril Cardiovascular Altace® Rizatriptan ODT Central nervous system Maxalt® ODT Rosuvastatin Cardiovascular Crestor® Sertraline Central nervous system Zoloft® Sildenafil Urology Viagra® Tadalafil Urology Cialis® Telmisartan Cardiovascular Micardis® Telmisartan HCTZ Cardiovascular Micardis Plus® Topiramate Anticonvulsant Topamax® Tramadol Acetaminophen Central nervous system Tramacet® Zolmitriptan Central nervous system Zomig® Zopiclone Central nervous system Imovane® 2 In addition to the 52 drugs currently on the market, we have 32 additional drugs scheduled to be launched in 2024 and 2025.
Nora Pharma is relatively new in this space but has demonstrated one of the fastest year-over-year sales increase amongst its peers. Our Anti-Coronavirus drug development project is in direct competition with several companies in the U.S. that have developed effective vaccines or treatment options for Covid-19. The companies focused on treatments include Pfizer, Merck, Gilead, Eli Lilly, and Regeneron.
Nora Pharma is relatively new in this space but has demonstrated one of the fastest year-over-year sales increase amongst its peers. 6 Our Anti-Coronavirus drug development project is in direct competition with several companies in the U.S. that have developed effective vaccines or treatment options for Covid-19. The companies focused on treatments include Pfizer, Merck, Gilead, Eli Lilly, and Regeneron.
Depending on various issues and considerations, the FDA could provide “emergency use authorization” or limited approval for “compassionate-use” if the drug treats terminally ill patients with limited other treatment options available. As of the date of the filing of this report, we have not made any filings with the FDA or other regulatory bodies in other jurisdictions.
Depending on various issues and considerations, the FDA could provide “emergency use authorization” or limited approval for “compassionate-use” if the drug treats terminally ill patients with limited or no other treatment options available. As of the date of the filing of this report, we have not made any filings with the FDA or other regulatory bodies in other jurisdictions.
These two polyproteins are cleaved at 15 specific sites by two virus encoded proteases (Mpro and PLpro) to generate 16 different non-structural proteins essential for viral replication. Mpro and PLpro represent attractive anti-viral drug development targets as they play a central role in the early stages of viral replication.
These two polyproteins are cleaved at 15 specific sites by two virus encoded proteases, called Mpro and PLpro, to generate 16 different non-structural proteins essential for viral replication. Mpro and PLpro represent attractive anti-viral drug development targets as they play a central role in the early stages of viral replication.
As of the date of this report, we believe Essential 9™ is the only Essential Amino Acid product that comprises all 9 essential amino acids in capsule form. We believe this may provide us with a competitive advantage, at least for the near future but there are no assurances that this will occur. 7
As of the date of this report, we believe Essential 9™ is the only Essential Amino Acid product that comprises all 9 essential amino acids in capsule form. We believe this may provide us with a competitive advantage, at least for the near future but there are no assurances that this will occur.
Intellectual Property We are the sole owner of all worldwide rights pertaining to Adva-27a. These patent rights are covered by PCT/FR2007/000697 and PCT/CA2014/000029. The patent applications filed under these two PCT's have been issued in the United States (US Patent Number 8,236,935 and 10,272,065), Europe, and Canada.
Intellectual Property We are the sole owner of all rights pertaining to Adva-27a. These patent rights are covered by PCT/FR2007/000697 and PCT/CA2014/000029. The patent applications filed under these two PCT's have been issued in the United States under US Patent Number 8,236,935 and 10,272,065.
Though the FDA and Health Canada have generally similar requirements for drugs and OTC supplements to be approved or allowed to be marketed, approval in one jurisdiction does not automatically result in approval in the other.
The Canadian counterpart to the FDA is Health Canada. Though the FDA and Health Canada have generally similar requirements for drugs and OTC supplements to be approved or allowed to be marketed, approval in one jurisdiction does not automatically result in approval in the other.
Under the agreement, the University of Arizona granted the Company a first option to negotiate a commercial, royalty-bearing license for all intellectual property developed by University of Arizona personnel under the Research Project.
Under the agreement, the University of Arizona granted us a first option to negotiate a commercial, royalty-bearing license for all intellectual property developed by University of Arizona under the Research Project.
A Topoisomerase II inhibitor, Adva-27a has been shown to be effective at destroying Multidrug Resistant Cancer cells including Pancreatic Cancer cells, Breast Cancer cells, Small-Cell Lung Cancer cells and Uterine Sarcoma cells (Published in ANTICANCER RESEARCH, Volume 32, Pages 4423-4432, October 2012). We are the direct owner of all issued patents pertaining to Adva-27a including U.S.
A Topoisomerase II inhibitor, Adva-27a has been shown to be effective at destroying Multidrug Resistant Cancer cells including Pancreatic Cancer cells, Breast Cancer cells, Small-Cell Lung Cancer cells and Uterine Sarcoma cells (Published in ANTICANCER RESEARCH, Volume 32, Pages 4423-4432, October 2012). We are the direct owner of all patents pertaining to Adva-27a including U.S. Patents Number 8,236,935 and 10,272,065.
History We were incorporated in the State of Colorado on August 31, 2006 and on October 15, 2009 we acquired Sunshine Biopharma, Inc. in a transaction classified as a reverse acquisition. Sunshine Biopharma, Inc. was holding an exclusive license to a new anticancer drug bearing the laboratory name, Adva-27a (the “License Agreement”).
See “Drugs in Development,” below. History We were incorporated in the State of Colorado on August 31, 2006, and on October 15, 2009, we acquired Sunshine Biopharma, Inc. in a transaction classified as a reverse acquisition. Sunshine Biopharma, Inc. held an exclusive license to a new anticancer drug bearing the laboratory name, Adva-27a (the “License Agreement”).
Research quantities of our proprietary drug candidates are currently manufactured at the University of Arizona located in Tucson, Arizona (Anti-Coronavirus compounds), WuXi App Tech located in Hong Kong, China (Adva-27a compound), and Arranta Bio MA LLC located in Watertown, Massachusetts (K1.1 mRNA).
Research quantities of our proprietary drug candidates are currently manufactured at the University of Arizona located in Tucson, Arizona (Anti-Coronavirus compounds), WuXi App Tech located in Hong Kong, China (Adva-27a compound), and Arranta Bio MA LLC located in Watertown, Massachusetts (K1.1 mRNA). Our OTC products are manufactured under contract by INOV Pharma Inc. located in Montreal, Canada.
ITEM 1. BUSINESS About Sunshine Biopharma We are a pharmaceutical company offering and researching life-saving medicines in a wide variety of therapeutic areas, including oncology and antivirals. In addition to our own drug development operations, we operate three wholly owned subsidiaries, including (i) Nora Pharma Inc.
ITEM 1. BUSINESS About Sunshine Biopharma We are a pharmaceutical company offering and researching life-saving medicines in a wide variety of therapeutic areas, including oncology and antivirals. We operate two wholly owned subsidiaries: (i) Nora Pharma Inc.
Competition The Canadian generic pharmaceuticals market is valued at approximately $7.2 billion CAD (approximately $5.3 billion USD). Generic pharmaceutical companies produce and deliver more than 70% of the prescribed medicines with high quality at affordable prices. There are more than 35 active generic players in the market, of which, the top 3 hold approximately 50% share of the market.
Generic pharmaceutical companies produce and deliver more than 70% of the prescribed medicines with high quality at affordable prices. There are more than 35 active generic players in the market, of which, the top 3 hold approximately a 50% share of the market.
In Canada, prescription drugs and nonprescription OTC supplements are authorized through the issuance by Health Canada of a Drug Identification Number (DIN) for the former and a Natural Product Number (NPN) for the latter. In the United States, the marketing of OTC supplements does not require prior approval from the FDA, provided that the ingredients are known to the FDA.
In Canada, prescription drugs and nonprescription OTC supplements are authorized through the issuance by Health Canada of a Drug Identification Number (DIN) for the former and a Natural Product Number (NPN) for the latter. In the United States, OTC supplements are required to be registered with the FDA prior to marketing.
In December 2015, we acquired all worldwide issued (US Patent Number 8,236,935, and 10,272,065) and pending patents under PCT/FR2007/000697 and PCT/CA2014/000029 for the Adva-27a anticancer compound and terminated the License Agreement.
In December 2015, we acquired all worldwide issued (US Patent Number 8,236,935, and 10,272,065) and pending patents under PCT/FR2007/000697 and PCT/CA2014/000029 for the Adva-27a anticancer compound and terminated the License Agreement. Development of Adva-27a has been paused pending further analysis of unexpected in vitro results obtained in the latter part of 2023. See “Drugs in Development,” below.
Moreover, the Province of Quebec has various language laws governing language use. These laws require corporate operations carried out in the Province of Quebec to be conducted to a large extent, and some cases entirely, in French. We and our Canadian subsidiaries operating in the Province of Quebec are fully compliant with these laws.
These laws require corporate operations carried out in the Province of Quebec to be conducted to a large extent, and in some cases entirely, in French. We and our Canadian subsidiaries operating in the Province of Quebec are fully compliant with these laws. Competition The Canadian generic pharmaceuticals market was valued at approximately $9.7 billion USD in 2023.
We are committed to meeting or exceeding the standards set by the FDA and the FTC and we believe we are currently operating within both the FDA and FTC mandates. 6 Employees As of the date of this report we have a total of 46 employees, comprised of our management team and other corporate personnel and 37 employees at Nora Pharma.
We are committed to meeting or exceeding the standards set by the FDA and the FTC and we believe we are currently operating within both the FDA and FTC mandates. Employees As of the date of this report we have a total of 44 employees. Women compose approximately 57% of our workforce.
In Canada, the pan-Canadian Pharmaceutical Alliance (pCPA), an alliance of the provincial, territorial and federal governments that collaborates on a range of public drug plan initiatives to increase and manage access to clinically effective and affordable drug treatments, determines generic drugs pricing based on a percentage of the brand-name reference products.
In Canada, the pan-Canadian Pharmaceutical Alliance (pCPA), an alliance of the provincial, territorial and federal governments that collaborates on a range of public drug plan initiatives to increase and manage access to clinically effective and affordable drug treatments, determines generic drugs pricing based on a percentage of the brand-name reference products. 5 In the area of proprietary drug development where our Anti-Coronavirus and Anti-Cancer compounds fall, we will be subject to significant regulations in the U.S. in order to obtain approval of the FDA to offer our products for sale.
In addition, the Company and the University of Arizona entered into an Option Agreement whereby the Company was granted a first option to negotiate a royalty-bearing commercial license for the underlying technology of the Research Project. Encouraged by the results obtained to date, we submitted a Notice of Option Exercise to the University of Arizona on September 13, 2022.
In addition, we and the University of Arizona have entered into an option agreement (the “Option Agreement”) whereby we were granted a first option to negotiate a royalty-bearing commercial license for the underlying technology of the Research Project.
We recently concluded an agreement with a specialized partner for the purposes of formulating our K1.1 mRNA molecules into lipid nanoparticles, ready for use to conduct studies in xenograft mice.
In November 2022, we concluded an agreement with a specialized commercial partner for the purposes of formulating our K1.1 mRNA molecules into lipid nanoparticles (“LNP”) for use to conduct xenograft mice studies. The initial results of our xenograft mice studies indicate that our K1.1 mRNA-LNP is effective at reducing the size of liver cancer xenograft tumors in mice.
On May 22, 2020, we filed a patent application in the United States for a new treatment for Coronavirus infections. Our patent application covers composition subject matter pertaining to small molecules for inhibition of the Coronavirus main protease (Mpro) and papain-like protease (PLpro).
Our Anti-Coronavirus research effort has been focused on developing an inhibitor of PLpro and, on May 22, 2020, we filed a patent application in the United States covering composition subject matter pertaining to small molecules for inhibition of the Coronavirus PLpro as well as Mpro.
(“Nora Pharma”), a Canadian corporation with a portfolio consisting of 49 prescription drugs on the market in Canada and 28 additional drugs scheduled to be launched in 2023 and 2024, (ii) Sunshine Biopharma Canada Inc.
(“Nora Pharma”), a Canadian corporation with a portfolio consisting of 52 prescription drugs on the market in Canada, and (ii) Sunshine Biopharma Canada Inc. (“Sunshine Canada”), a Canadian corporation which develops and sells OTC supplements.
In addition, we are the owner of two NPN’s issued by Health Canada: NPN 80089663 authorizes us to manufacture and sell our in-house developed OTC product, Essential 9™, and NPN 80093432 authorizes us to manufacture and sell the OTC product, Calcium-Vitamin D under the brand name Essential Calcium-Vitamin D ™ .
These DIN’s were secured through in-licenses or cross-licenses from international manufacturers of generic pharmaceutical products. 4 In addition, we are the owner of four (4) NPN’s issued by Health Canada including (i) NPN 80089663 which authorizes us to manufacture and sell our in-house developed OTC product, Essential 9™, (ii) NPN 80093432 which authorizes us to manufacture and sell the OTC product, Calcium-Vitamin D under the brand name Essential Calcium-Vitamin D ™ , (iii) NPN 80125047 which authorizes us to manufacture and sell the OTC product, L-Citrulline, and (iv) NPN 80127436 which authorizes us to manufacture and sell the OTC product, Taurine.
PLpro is of particular interest as a therapeutic target in that, in addition to processing viral proteins, it is also responsible for suppression of the human immune system making the virus more life-threatening. Our COVID-19 research effort has been focused on developing an inhibitor of PLpro, the viral enzyme that mediates suppression of the human immune system.
PLpro is of particular interest as a therapeutic target in that, in addition to processing essential viral proteins, it is also responsible for suppression of the human immune system making the virus more life-threatening. PLpro is present only in Betacoronaviruses, the subgroup of Coronaviruses represented by the highly pathogenic SARS-CoV, MERS-CoV, and SARS-CoV-2.
In the United States, the Federal Government agency responsible for regulating prescription drugs and nonprescription OTC supplements is the U.S. Food and Drug Administration (“FDA”). The Canadian counterpart to the FDA is Health Canada.
Government Regulations All of our business operations, including our generic drugs, proprietary drugs, and OTC products operations, are subject to extensive and frequently changing federal, state, provincial and local laws and regulations. In the United States, the Federal Government agency responsible for regulating prescription drugs and nonprescription OTC supplements is the U.S. Food and Drug Administration (“FDA”).
Presently, our proprietary drug development activities are subcontracted out to specialized service providers in the U.S. and Canada. We also use consultants for various other activities including, marketing, accounting, and IT. Labors laws in Quebec provide for certain guaranteed minimum entitlements, including minimum wages, maternity leave, medical leave, employee termination conditions, etc.
Going forward, we are committed to maintaining fully balanced workforce that includes persons of diverse sexual orientation and ethnic backgrounds. Presently, our proprietary drug development activities are subcontracted out to specialized service providers in the U.S., Canada and overseas. We also use consultants for various other activities including marketing, accounting, and IT.
Our OTC products are manufactured under contract by INOV Pharma Inc. located in Montreal, Canada. 5 Marketing and Sales Our generic drugs are currently being sold across Canada. All of our generic drug sales are conducted by Nora Pharma’s sales representatives based in key Provinces across Canada.
Marketing and Sales Our generic drugs are currently being sold across Canada. All of our generic drug sales are conducted by Nora Pharma’s sales representatives based in key Provinces across Canada. A segment of our marketing team provides human resources, commercial and technical assistance, as well as training and education support to pharmacy owners.
We anticipate commencing such studies within approximately the next twelve months. 4 SBFM-PL4 COVID-19 Treatment The initial genome expression products of Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2), the causative agent of COVID-19, are two large polyproteins, referred to as pp1a and pp1ab.
We are currently seeking to confirm these results by conducting additional xenograft experiments on a broader scale and in more detailed dose-response studies. 3 SBFM-PL4 SARS Coronavirus Treatment The initial genome expression products following infection by Betacoronavirus, the causative agent of COVID-19, are two large polyproteins, referred to as pp1a and pp1ab.
Our recently acquired wholly owned subsidiary, Nora Pharma, owns 152 DIN’s issued by Health Canada for prescription drugs currently on the market in Canada. These DIN’s were secured through in-licenses or cross-licenses from international manufacturers of generic pharmaceutical products.
Effective February 24, 2023, we became the exclusive, worldwide licensee of the University of Arizona for three (3) patents related to small molecules which inhibit the Coronavirus protease, PLpro. Our wholly owned subsidiary, Nora Pharma, owns 152 DIN’s issued by Health Canada for prescription drugs currently on the market in Canada.
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(“Sunshine Canada”), a Canadian corporation which develops and sells OTC supplements, and (iii) NOX Pharmaceuticals, Inc., a Colorado corporation which is inactive and is scheduled to be dissolved later this year.
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In addition, we are conducting a proprietary drug development program which is comprised of (i) K1.1 mRNA targeted for liver cancer, (ii) SBFM-PL4, PLpro protease inhibitor for SARS Coronavirus infections, and (iii) Adva-27a for pancreatic cancer. Development of the latter has been paused pending further analysis of unfavorable in vitro results obtained in the second half of 2023.
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Nora Pharma has 37 employees and operates in a 15,000 square foot facility certified by Health Canada. Nora Pharma currently offers 49 generic prescription drugs and 11 nonprescription OTC products. Nora Pharma sales were $10.7 million USD during its fiscal year ended June 30, 2022.
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Nora Pharma has 44 employees and operates in a 23,500 square foot facility certified by Health Canada.
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Patents Number 8,236,935 and 10,272,065. Adva-27a is a GEM-difluorinated C-glycoside derivative of Podophyllotoxin. Another derivative of Podophyllotoxin called Etoposide is currently on the market and is used to treat various types of cancer including leukemia, lymphoma, testicular cancer, lung cancer, brain cancer, prostate cancer, bladder cancer, colon cancer, ovarian cancer, liver cancer and several other forms of cancer.
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These new drugs will address various human health areas including cardiovascular, oncology, gastroenterology, central nervous system, diabetes, urology, endocrinology, anti-infective, and anti-inflammatory.
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Etoposide is one of the most widely used anticancer drugs. Adva-27a and Etoposide are similar in that they both attack the same target in cancer cells, namely the DNA unwinding enzyme, Topoisomerase II. Unlike Etoposide however, Adva-27a is able to penetrate and destroy Multidrug Resistant Cancer cells.
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We believe the addition of these products to our existing portfolio will strengthen our presence in the Canadian $9.7 billion a year generic drugs market and provide us with greater access to pharmacies as we become more of a go-to supplier for every-day and specialty medicines.
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In addition, Adva-27a has been shown to have distinct and more desirable biological and pharmacological properties compared to Etoposide.
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Products in Development The following table summarizes our proprietary drugs in development: Drug Candidate Therapeutic Area Development Stage Adva-27a (Small Molecule) Oncology (Pancreatic Cancer) Paused* K1.1 (mRNA LNP) Oncology (Liver Cancer) Animal Testing SBFM-PL4 (Small Molecule) Antiviral (SARS Coronavirus) Animal Testing *See “Adva-27a Anticancer Compound,” below Adva-27a Anticancer Compound Adva-27a is a small molecule designed for the treatment of aggressive forms of cancer.
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In side-by-side studies using Multidrug Resistant Breast Cancer cells and Etoposide as a reference, Adva-27a showed markedly greater cell killing activity (see Figure 1). 3 Figure 1 In February 2023, we signed a research agreement with the Jewish General Hospital (“JGH”), to complete the IND-enabling studies.
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In December 2022, we entered into a research agreement with the Jewish General Hospital (“JGH”), to conduct the IND-enabling studies of Adva-27a (the “Research Agreement”). In August 2023, we were informed by the JGH that the laboratory results on testing of the Adva-27a molecule were not favorable.
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The JGH has also agreed to negotiate with us the terms for Phase I Clinical Trials. Adva-27a’s initial indication will be pancreatic cancer for which there are currently little or no treatment options available. All aspects of the clinical trials in Canada will employ FDA standards at all levels.
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After conclusion of an internal review of the laboratory results on November 2, 2023, we provided notice to JGH of termination of the Research Agreement. We have now paused the IND-enabling studies of Adva-27a pending a review of the results and the possibility of chemical modification of the compound to address the suboptimal performance of the molecule in certain studies.
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In addition, a segment of our marketing team offers human resources and commercial assistance to pharmacies and pharmacy owners by providing experienced pharmacists and technical assistant recruitment services as well as training and education support. Our OTC products are currently sold in the U.S. and Canada through Amazon.com and Amazon.ca, respectively.
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On September 13, 2022, we exercised our options, and on February 24, 2023, we entered into an exclusive worldwide license agreement with the University of Arizona for all of the technology related to the Research Project.
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Our personnel together with outside consultants develop and place ads on Google, YouTube, Amazon, and other media outlets. The same team manages our accounts with Amazon. Government Regulations All of our business operations, including our generic drugs, proprietary drugs, and OTC products operations, are subject to extensive and frequently changing federal, state, provincial and local laws and regulations.
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We have recently broadened our objective to include the development of an injectable drug candidate of first-in-class PLpro inhibitor to treat SARS-CoV2 and potentially SARS-CoV and MERS-CoV infection in patients who could not use Paxlovid, Molnupiravir, or Remdesivir, due to concerns about drug interactions and possible ‘rebound’ infections and other side effects.
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In the area of proprietary drug development where our Anti-Coronavirus and Anti-Cancer compounds fall, we will be subject to significant regulations in the U.S. in order to obtain approval of the FDA to offer our products for sale.
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Our OTC products are currently sold in the U.S. and Canada through Amazon.com and Amazon.ca, respectively. Our personnel, together with outside consultants develop and place ads on various media platforms and manage our accounts with Amazon.
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We anticipate filing an initial IND application for an anti-Covid-19 compound within approximately one year and filing an initial IND for our anti-cancer compound within approximately two years.
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Labors laws in Quebec provide for certain guaranteed minimum entitlements, including minimum wages, maternity leave, medical leave, employee termination conditions, and other similar benefits. Moreover, the Province of Quebec has various language laws governing language use.
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We have however had discussions with clinicians and as a result we believe that the FDA and Health Canada are likely to grant us a so-called “fast-track” process on the basis of the ongoing Covid-19 pandemic and the terminal nature of the cancer type we are planning to treat. There are no assurances this will occur.
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Our goal is to deliver medicines that change patients’ lives. Such ambitious goal is achieved through the relentless effort and dedication of our talented workforce. As of December 31, 2022, women compose approximately 48% of our workforce. Going forward, we are committed to maintaining fully balanced workforce that includes persons of diverse sexual orientation and ethnic backgrounds.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeEven if we obtain required US and foreign regulatory approvals, as applicable, factors that may inhibit our efforts to commercialize our pharmaceutical product candidates without strategic partners or licensees include: · difficulty recruiting and retaining adequate numbers of effective sales and marketing personnel; · the inability of sales personnel to obtain access to, or persuade adequate numbers of, physicians to prescribe our products; · the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage against companies with broader product lines; and · unforeseen costs associated with creating an independent sales and marketing organization. 12 Even if we successfully develop and obtain approval for our proprietary drug product candidates, our business will not be profitable if such products do not achieve and maintain market acceptance.
Biggest changeEven if we obtain required US and foreign regulatory approvals, as applicable, factors that may inhibit our efforts to commercialize our pharmaceutical product candidates without strategic partners or licensees include: · difficulty recruiting and retaining adequate numbers of effective sales and marketing personnel; · the inability of sales personnel to obtain access to, or persuade adequate numbers of, physicians to prescribe our products; · the lack of complementary products to be offered by sales personnel, which may put us at a competitive disadvantage against companies with broader product lines; and · unforeseen costs associated with creating an independent sales and marketing organization. 11 Even if we successfully develop and obtain approval for our proprietary drug product candidates, our business will not be profitable if such products do not achieve and maintain market acceptance Even if our proprietary drug product candidates are approved for commercial sale by the FDA or other regulatory authorities, the degree of market acceptance of our approved product candidates by physicians, healthcare professionals, patients and third-party payors, and our resulting profitability and growth, will depend on a number of factors, including: · our ability to provide acceptable evidence of safety and efficacy; · relative convenience and ease of administration; · the prevalence and severity of any adverse side effects; · the availability of alternative treatments; · the details of FDA labeling requirements, including the scope of approved indications and any safety warnings; · pricing and cost effectiveness; · the effectiveness of our or our collaborators' sales and marketing strategy; · our ability to obtain sufficient third-party insurance coverage or reimbursement; and · our ability to have the product listed on insurance company formularies.
Investors should take note of the fact that a lack of a dividend can further affect the market value of our common stock and could significantly affect the value of any investment in the Company.
Investors should take note of the fact that a lack of a dividend can further affect the market value of our common stock and could significantly affect the value of any investment in our Company.
Consequently, our ability to sustain our sales and profitability on any given product over time is affected by the number of companies selling such product, including new market entrants, and the timing of their approvals. 8 Furthermore, brand pharmaceutical companies continue to manage products in a challenging environment through marketing agreements with payers, pharmacy benefits managers and generic manufacturers.
Consequently, our ability to sustain our sales and profitability on any given product over time is affected by the number of companies selling such product, including new market entrants, and the timing of their approvals. Furthermore, brand pharmaceutical companies continue to manage products in a challenging environment through marketing agreements with payers, pharmacy benefits managers and generic manufacturers.
Because we do not control the actual production of these raw materials, we are also subject to delays caused by interruption in production of materials including but not limited to those resulting from conditions outside of our control, such as pandemics, weather, transportation interruptions, strikes, terrorism, natural disasters, and other catastrophic events.
Because we do not control the actual production of these raw materials, we are also subject to delays caused by interruption in production of materials including but not limited to those resulting from conditions outside of our control, such as pandemics, weather, transportation interruptions, strikes, terrorism, geopolitics, natural disasters, and other catastrophic events.
Academic institutions, government agencies, and other public and private research organizations may seek patent protection with respect to potentially competitive products or technologies and may establish exclusive collaborative or licensing relationships with our competitors. 14 Our competitors may succeed in obtaining FDA or other regulatory approvals for product candidates more rapidly than us.
Academic institutions, government agencies, and other public and private research organizations may seek patent protection with respect to potentially competitive products or technologies and may establish exclusive collaborative or licensing relationships with our competitors. Our competitors may succeed in obtaining FDA or other regulatory approvals for product candidates more rapidly than us.
If we are unable to establish sales and marketing capabilities for our pharmaceutical product candidates or enter into agreements with third parties to sell and market any such products we may develop, we may be unable to generate revenues from our pharmaceutical business. We do not currently have product sales and marketing capabilities for our pharmaceutical operations.
If we are unable to establish sales and marketing capabilities for our pharmaceutical product candidates or enter into agreements with third parties to sell and market any such products we may develop, we may be unable to generate revenues from our non-generic pharmaceutical business We do not currently have product sales and marketing capabilities for our non-generic pharmaceutical operations.
Our OTC supplements business is subject to the effects of adverse publicity, which could negatively affect our sales and revenues. Our business can be affected by adverse publicity or negative public perception about us, our competitors, our products, or our industry or competitors generally.
Our business is subject to the effects of adverse publicity, which could negatively affect our sales and revenues Our business can be affected by adverse publicity or negative public perception about us, our competitors, our products, or our industry or competitors generally.
There is typically an extremely high rate of failure as product candidates proceed through clinical trials. If our product candidates fail to demonstrate sufficient safety and efficacy in any clinical trial, we would experience potentially significant delays in, or be required to abandon, development of that product candidate.
There is typically an extremely high rate of failure as product candidates proceed through the various phases of clinical trials. If our product candidates fail to demonstrate sufficient safety and efficacy in any clinical trial, we would experience potentially significant delays in, or be required to abandon, development of that product candidate.
We are currently unable to project when or whether our operations will generate positive cash flows from operations. 9 Any additional equity securities we issue or issuances of debt we may enter into or undertake may have rights, preferences or privileges senior to those of existing holders of common stock.
We are currently unable to project when or whether our operations will generate positive cash flow. Any additional equity securities we issue or issuances of debt we may enter into or undertake may have rights, preferences or privileges senior to those of existing holders of common stock.
We will require additional funding to satisfy our future capital needs, which may not be available. We may require significant additional funding in large part due to our research and development expenses, future preclinical and clinical testing costs, and the absence of significant revenues in the near future.
We will require additional funding to satisfy our future capital needs, which may not be available We will require significant additional funding in large part due to our research and development expenses, future preclinical and clinical testing costs, and insufficient sales revenues in the near future.
We have paid no dividends on our common stock to date and we do not anticipate paying any dividends to holders of our common stock in the foreseeable future.
We do not intend to pay dividends on our common stock for the foreseeable future We have paid no dividends on our common stock to date and we do not anticipate paying any dividends to holders of our common stock in the foreseeable future.
Accordingly, we cannot predict the breadth of claims that will be allowed or maintained, after challenge, in our or other companies' patents. 15 The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that: · we were the first to make the inventions covered by each of our pending patent applications; · we were the first to file patent applications for these inventions; · others will not independently develop similar or alternative technologies or duplicate any of our technologies; · any patents issued to us or our collaborators will provide a basis for commercially viable products, will provide us with any competitive advantages or will not be challenged by third parties; · our pending patent applications will result in issued patents; · we will develop additional proprietary technologies that are patentable; · the patents of others will not have a negative effect on our ability to do business; or · our issued patents will have sufficient useful life remaining for commercial viability of our product candidate.
The degree of future protection for our proprietary rights is uncertain, and we cannot ensure that: · we were the first to make the inventions covered by each of our pending patent applications; · we were the first to file patent applications for these inventions; · others will not independently develop similar or alternative technologies or duplicate any of our technologies; · any patents issued to us or our collaborators will provide a basis for commercially viable products, will provide us with any competitive advantages, or will not be challenged by third parties; · our pending patent applications will result in issued patents; · we will develop additional proprietary technologies that are patentable; · the patents of others will not have a negative effect on our ability to do business; or · our issued patents will have sufficient useful life remaining for commercial viability of our product candidate.
A significant decline in consumer demand, even if only due in part to general economic conditions could have a material adverse effect on our revenues and profit margins.
Any decline in economic conditions could negatively impact our business. A significant decline in consumer demand, even if only due in part to general economic conditions could have a material adverse effect on our revenues and profit margins.
Adverse publicity may include publicity about the OTC supplements industry generally, the efficacy, safety and quality of OTC supplements and other health care products or ingredients in general or our products or ingredients specifically, and regulatory investigations, regardless of whether these investigations involve us or the business practices or products of our competitors, or our customers.
Adverse publicity may include publicity about the efficacy, safety and quality of health care products or ingredients in general or our products or ingredients specifically, and regulatory investigations, regardless of whether these investigations involve us or the business practices or products of our competitors, or our customers.
Our board of directors has the authority to issue up to 30,000,000 shares of our preferred stock without further stockholder approval. 1,000,000 shares of preferred stock are designated Series B Preferred Stock and 10,000 of such shares are outstanding and held by our chief executive officer.
Our board of directors has the authority to issue up to 30,000,000 shares of our preferred stock without further stockholder approval. 1,000,000 shares of preferred stock are designated Series B Preferred Stock and as of the date of this Report, 130,000 of such shares are outstanding and held by our Chief Executive Officer.
Increasing cost pricing pressures on raw materials and other products have continued throughout fiscal 2020 as a result of limited supplies of various ingredients, the effects of higher labor and transportation costs, and impact of Covid-19. We expect these upward pressures to continue through fiscal 2021.
Increasing cost pricing pressures on raw materials and other products occurred throughout fiscal 2023 as a result of limited supplies of various ingredients, the effects of higher labor and transportation costs, and the impact of Covid-19. We expect these upward pressures to continue through fiscal 2024.
Our business, financial condition, results of operations and prospects could be materially and adversely affected by these risks. Risks Related to Our Business We have incurred losses and may never achieve profitability. We have an accumulated deficit of $59,399,614 as of December 31, 2022.
Our business, financial condition, results of operations and prospects could be materially and adversely affected by these risks. Risks Related to Our Business We have incurred losses and may never achieve profitability We have an accumulated deficit of $63,905,658 as of December 31, 2023.
The failure of our service providers and suppliers to supply quality services and materials in sufficient quantities, at a favorable price, and in a timely fashion could adversely affect the results of our operations. Our outside manufacturer buys raw materials for our OTC supplements business from a limited number of suppliers.
The failure of our service providers and suppliers to supply quality services and materials in sufficient quantities, at a favorable price, and in a timely fashion could adversely affect the results of our operations Our outside manufacturers buy raw materials from a limited number of suppliers.
Our business, financial condition and results of operations could be adversely affected if any of our products or any similar products distributed by other companies are alleged to be or are proved to be harmful to consumers or to have unanticipated and unwanted health consequences. Our manufacturing and third-party fulfillment activities are subject to certain risks.
Our business, financial condition and results of operations could be adversely affected if any of our products or any similar products distributed by other companies are alleged to be or are proved to be harmful to consumers or to have unanticipated and unwanted health consequences.
If we receive approval in applicable jurisdictions to commercialize Adva-27a for the treatment of breast cancer indication, we intend to engage additional pharmaceutical or health care companies with existing distribution systems and direct sales organizations to assist us in North America and throughout the world. We may not be able to negotiate favorable distribution partnering arrangements, if at all.
If we receive approval in applicable jurisdictions to commercialize any of our pharmaceutical products candidates, we intend to engage additional pharmaceutical or health care companies with existing distribution systems and direct sales organizations to assist us in North America and throughout the world. We may not be able to negotiate favorable distribution partnering arrangements, if at all.
Our OTC supplements products are manufactured at third party manufacturing facilities in Canada. As a result, we are dependent on the uninterrupted and efficient operation of these facilities.
Our manufacturing and third-party fulfillment activities are subject to certain risks Our products are manufactured at third party manufacturing facilities in Canada and overseas. As a result, we are dependent on the uninterrupted and efficient operation of these facilities.
We face regulation and risks related to hazardous materials and environmental laws, violations of which may subject us to claims for damages or fines that could materially affect our business, cash flows, financial condition and results of operations. Our research and development activities involve the use of controlled and/or hazardous materials and chemicals.
A successful product liability claim, or series of claims brought against us would decrease our cash reserves and could cause our stock price to fall significantly. 10 We face regulation and risks related to hazardous materials and environmental laws, violations of which may subject us to claims for damages or fines that could materially affect our business, cash flows, financial condition and results of operations Our research and development activities involve the use of controlled and/or hazardous materials and chemicals.
If any of our pharmaceutical product candidates is approved by the FDA or other regulatory agencies for commercial sale, we will need third parties to manufacture the product in larger quantities.
Third party manufacturers may not be able to manufacture our pharmaceutical product candidates, which would prevent us from commercializing our product candidates If any of our pharmaceutical product candidates is approved by the FDA or other regulatory agencies for commercial sale, we will need third parties to manufacture the product in larger quantities.
The drugs that we are attempting to develop will compete with existing therapies if we receive marketing approval. Because of their significant resources, our competitors may be able to use discovery technologies and techniques, or partnerships with collaborators, to develop competing products that are more effective or less costly than the product candidate we are developing.
Because of their significant resources, our competitors may be able to use discovery technologies and techniques, or partnerships with collaborators, to develop competing products that are more effective or less costly than the product candidate we are developing. This may render our technology or product candidate obsolete and noncompetitive.
Regulatory requirements may change in a manner that requires us to conduct additional clinical trials, which may delay or prevent commercialization of our Adva-27a and potential Covid-19 treatment in development.
The FDA may change its approval policies or requirements, or apply interpretations to its policies or requirements, in a manner that could delay or prevent commercialization of K1.1 mRNA or our potential Covid-19 treatment in development Regulatory requirements may change in a manner that requires us to conduct additional clinical trials, which may delay or prevent commercialization of our K1.1 mRNA and potential Covid-19 treatment in development.
The commencement of clinical trials can be delayed for a variety of reasons, including delays in: · demonstrating sufficient safety to obtain regulatory approval to commence a clinical trial; · reaching agreement on acceptable terms with prospective research organizations and trial sites; · manufacturing sufficient quantities of a product candidate; · obtaining institutional review board approvals to conduct clinical trials at prospective sites; and · procuring adequate financing to fund the work.
The commencement of clinical trials can be delayed for a variety of reasons, including delays in: · demonstrating sufficient safety to obtain regulatory approval to commence a clinical trial; · reaching agreement on acceptable terms with prospective research organizations and trial sites; · manufacturing sufficient quantities of a product candidate; · obtaining institutional review board approvals to conduct clinical trials at prospective sites; and · procuring adequate financing to fund the work. 12 In addition, the commencement of clinical trials may be delayed due to insufficient patient enrollment, which is a function of many factors, including the size of the patient population, the nature of the protocol, the proximity of patients to clinical sites, the availability of effective treatments for the relevant disease, and the eligibility criteria for the clinical trial.
Generic pharmaceuticals are, as a general matter, significantly less profitable than innovative medicines, In recent years, the generic pharmaceutical business has experienced increased volatility in volumes due in large part to global supply chain issues and the COVID-19 pandemic.
In recent years, the generic pharmaceutical business has experienced increased volatility in volumes due in large part to global supply chain issues and the COVID-19 pandemic.
Our proprietary drug product candidates will require additional preclinical testing and extensive clinical trials prior to submitting a regulatory application for commercial sales. We do not know whether clinical trials will begin on time, if at all. Delays in the commencement of clinical testing could significantly increase our product development costs and delay product commercialization.
We do not know whether clinical trials will begin on time, if at all. Delays in the commencement of clinical testing could significantly increase our product development costs and delay product commercialization.
The amount of time to resolve lawsuits is unpredictable and defending ourselves may divert management’s attention from the day-to-day operations of our business, which could adversely affect our business, results of operations and cash flows. In addition, an unfavorable outcome in any such litigation could have a material adverse effect on our business, results of operations and cash flows.
The expense of defending litigation may be significant. The amount of time to resolve lawsuits is unpredictable and defending ourselves may divert management’s attention from the day-to-day operations of our business, which could adversely affect our business, results of operations and cash flows.
Pricing pressures in Canada represent the highest risk due to ongoing and unresolved negotiations between the pharmaceutical industry and the federal government.
Our generic sales in Canada are done via retail pharmacies, pharmacy channels, distributors, and wholesalers. Pricing pressures in Canada represent the highest risk due to ongoing and unresolved negotiations between the pharmaceutical industry and the federal government.
We have experienced increases in various raw material costs, transportation costs and the cost of petroleum-based raw materials and packaging supplies used in our business.
A shortage of raw materials or an unexpected interruption of supply could also result in higher prices for those materials. We have experienced increases in various raw material costs, transportation costs and the cost of petroleum-based raw materials and packaging supplies used in our business.
Since our acquisition of Nora in October 2022, we have generated revenues primarily through sales of generic pharmaceutical products in Canada, and we expect this to remain the case for the foreseeable future.
We are subject to the significant risks associated with the generic pharmaceutical business Since our acquisition of Nora Pharma in October 2022, we have generated revenues primarily through sales of generic pharmaceutical products in Canada, and we expect this to remain the case for the foreseeable future. Generic pharmaceuticals are, as a general matter, significantly less profitable than innovative medicines.
In addition, we may have to incur significant costs to comply with future environmental laws and regulations. We do not currently have a pollution and remediation insurance policy. 11 Third party manufacturers may not be able to manufacture our pharmaceutical product candidates, which would prevent us from commercializing our product candidates.
In addition, we may have to incur significant costs to comply with future environmental laws and regulations. We do not currently have a pollution and remediation insurance policy.
Most of our pharmaceutical company competitors, such as Merck, Bristol-Myers Squibb, Pfizer, Amgen, and others, are large pharmaceutical companies with substantially greater financial, technical, and human resources than we have. The biotechnology and pharmaceutical industries are intensely competitive and subject to rapid and significant technological change.
We face or will face significant competition from other biotechnology, pharmaceutical and OTC supplements companies, and our operating results will suffer if we fail to compete effectively Most of our pharmaceutical company competitors, such as Merck, Bristol-Myers Squibb, Pfizer, Amgen, and others, are large pharmaceutical companies with substantially greater financial, technical, and human resources than we have.
In addition, subject to the rules of any securities exchange on which our stock is then listed, our board of directors could authorize the creation of additional series of preferred stock that has greater voting power than our common stock or that is convertible into our common stock, which could decrease the relative voting power of our common stock or result in dilution to our existing stockholders.
In addition, subject to the rules of any securities exchange on which our stock is then listed, our board of directors could authorize the creation of additional series of preferred stock that has greater voting power than our common stock or that is convertible into our common stock, which could decrease the relative voting power of our common stock or result in dilution to our existing stockholders. 16 Additional stock offerings in the future or the issuance of stock upon exercise of outstanding warrants may dilute then-existing shareholders’ percentage ownership in our Company Given our plans and expectations that we will need additional capital and personnel, we anticipate that we will need to issue additional shares of common stock or securities convertible or exercisable for shares of common stock, including convertible preferred stock, convertible notes, stock options or warrants.
Our net sales may be affected by fluctuations in the buying patterns of our customers resulting from government lead pricing pressures and other factors. Our generic sales in Canada are done via retail pharmacies, pharmacy channels, distributors, and wholesalers.
Sales of our generic products may be adversely affected by the drug regulatory environment in Canada Currently we sell our generic drugs only in Canada. Our net sales may be affected by fluctuations in the buying patterns of our customers resulting from government lead pricing pressures and other factors.
If we are unable to enroll a sufficient number of evaluable patients, the clinical trials for our product candidates could be delayed until sufficient numbers are achieved. We face or will face significant competition from other biotechnology, pharmaceutical and OTC supplements companies, and our operating results will suffer if we fail to compete effectively.
If we are unable to enroll a sufficient number of evaluable patients, the clinical trials for our product candidates could be delayed until sufficient numbers are achieved.
Our ability to effectively manage our growth will require us to substantially expand the capabilities of our administrative and operational resources by attracting, training, managing, and retaining additional qualified personnel, including additional members of management, technicians, and others. To successfully develop our products we will need to manage operating, producing, marketing and selling our products.
The implementation of our business plan may result in a period of rapid growth that will impose a significant burden on our current administrative and operational resources Our ability to effectively manage our growth will require us to substantially expand the capabilities of our administrative and operational resources by attracting, training, managing, and retaining additional qualified personnel, including additional members of management, technicians, and others.
The loss of Dr. Slilaty will also significantly delay or prevent the achievement of our business objectives. Our business exposes us to potential product liability risks and we may be unable to acquire and maintain sufficient insurance to provide adequate coverage against potential liabilities.
Our business exposes us to potential product liability risks and we may be unable to acquire and maintain sufficient insurance to provide adequate coverage against potential liabilities Our business exposes us to potential product liability risks that are inherent in the testing, manufacturing and marketing of pharmaceutical products.
Our product candidates are novel compounds or new chemical entities, which may further increase the time required for satisfactory testing procedures. Data obtained from preclinical and clinical activities are susceptible to varying interpretations, which could delay, limit or prevent regulatory approval.
Our product candidates are novel compounds or new chemical entities, which may further increase the time required for satisfactory testing procedures.
We have not made any filings to date with the FDA or other regulatory bodies in other jurisdictions. The time required to attain product sales and profitability is lengthy and highly uncertain. If we fail to obtain required regulatory approvals for our pharmaceutical product candidates, our business will be materially harmed.
Our most advanced product candidate, K1.1 mRNA and our potential Covid-19 treatment in development may never be approved for commercial sale. We have not made any filings to date with the FDA or other regulatory bodies in other jurisdictions. The time required to attain product sales and profitability is lengthy and highly uncertain.
We may be forced to incur costs and expenses in connection with defending ourselves with respect to litigation and the payment of any settlement or judgment in connection therewith if there is an unfavorable outcome. The expense of defending litigation may be significant.
We may be sued or become a party to litigation, which could require significant management time and attention and result in significant legal expenses and may result in an unfavorable outcome which could have a material adverse effect on our business, financial condition, results of operations and cash flow We may be forced to incur costs and expenses in connection with defending ourselves with respect to litigation and the payment of any settlement or judgment in connection therewith if there is an unfavorable outcome.
These risks will increase to the extent our pharmaceutical product candidates receive regulatory approval and are commercialized. We currently have product liability insurance for our generic drugs and we plan to obtain product liability insurance in connection with our OTC supplements and future clinical trials of our pharmaceutical product candidates in the near future.
We currently have product liability insurance for our generic drugs and OTC products and we plan to obtain product liability insurance in connection with clinical trials of our pharmaceutical product candidates in the near future. However, our current and future product liability insurance may not provide adequate protection against potential liabilities.
We incurred a net loss of $26,744,440 for the year ended December 31, 2022, and a net loss of $12,436,447 for the year ended December 31, 2021. We may never achieve profitability. We are subject to the significant risks associated with the generic pharmaceutical business.
We incurred a net loss of $4,506,044 for the year ended December 31, 2023, and a net loss of $26,744,440 for the year ended December 31, 2022. We may never achieve profitability.
If we cannot execute timely launches of new products, we may not be able to offset the increasing price erosion on existing products resulting from pricing pressures and accelerated generics approvals for competing products. Such unsuccessful launches can be caused by many factors, including, delays in regulatory approvals, lack of operational or clinical readiness or patent litigation.
These actions may increase the costs and risks of our efforts to introduce generic products and may delay or prevent such introduction altogether. 8 We may experience delays in launching our new generic products If we cannot execute timely launches of new products, we may not be able to offset the increasing price erosion on existing products resulting from pricing pressures and accelerated generics approvals for competing products.
We cannot provide any assurance that the FDA will not require us to repeat existing studies or conduct new or unforeseen experiments in order to demonstrate the safety and efficacy of any product candidate before considering the approval of such product candidate.
We cannot provide any assurance that the FDA will not require us to repeat existing studies or conduct new or unforeseen experiments in order to demonstrate the safety and efficacy of any product candidate before considering the approval of such product candidates. 9 Our business would be materially harmed if we fail to obtain FDA approval for our pharmaceutical product candidates We anticipate that our ability to generate significant product revenues from our drug development business will depend on the successful development and commercialization of K1.1 mRNA or our potential Covid-19 treatment in development.
If we are unable to attract and retain qualified scientific, technical, and key management personnel, or if our key executive, Dr. Steve N. Slilaty, discontinues his employment with us, it may delay our research and development efforts. We rely on the services of Dr.
Slilaty, discontinues his employment with us, it may delay our research and development efforts We rely on the services of Dr. Slilaty for strategic and operational management, as well as for scientific and/or medical expertise in the development of our products. The loss of Dr.
This would adversely affect our ability to generate revenues and may damage our reputation in the industry and in the investment community. 13 The future clinical testing of our proprietary drug product candidates could be delayed, resulting in increased costs to us and a delay in our ability to generate revenues.
The future clinical testing of our proprietary drug product candidates could be delayed, resulting in increased costs to us and a delay in our ability to generate revenues Our proprietary drug product candidates will require additional preclinical testing and extensive clinical trials prior to submission of a regulatory application for commercial sales.
In addition, as of March 31, 2023, we have 1,764,594 and 9,725,690 shares of common issuable upon exercise of outstanding warrants with an exercise price of $2.22, and $3.76, respectively. The issuance of additional securities in the future will dilute the percentage ownership of then current stockholders. 18
In addition, as of December 31, 2023, we have 23,395,046 common shares issuable upon exercise of outstanding warrants with a weighted average exercise price of $1.94. The issuance of additional securities in the future will dilute the percentage ownership of our then current stockholders. ITEM 1B. UNRESOLVED STAFF COMMENTS None.
However, our current and future product liability insurance, once obtained, may not provide adequate coverage against potential liabilities. On occasion, juries have awarded large judgments in class action lawsuits based on drugs that had unanticipated side effects.
On occasion, juries have awarded large judgments in class action lawsuits based on drugs that had unanticipated side effects.
Such manufacturing operations, and those of its suppliers, are subject to power failures, blackouts, border shutdowns, telecommunications failures, computer viruses, cybersecurity vulnerabilities, human error, breakdown, failure or substandard performance of our facilities, our equipment, the improper installation or operation of equipment, terrorism, pandemics (including Covid-19), natural or other disasters, intentional acts of violence, and the need to comply with the requirements or directives of governmental agencies, including the FDA.
Such manufacturing operations, and those of their suppliers, are subject to power failures, blackouts, border shutdowns, telecommunications failures, computer viruses, cybersecurity vulnerabilities, human error, breakdown, failure or substandard performance.
There can be no assurances that we will be able to do so. Our failure to successfully manage our growth will have a negative impact on our anticipated results of operations. 16 A significant or prolonged economic downturn could have a material adverse effect on our results of operations.
Our failure to successfully manage our growth will have a negative impact on our anticipated results of operations. 14 A significant or prolonged economic downturn could have a material adverse effect on our results of operations A significant or prolonged economic downturn may adversely affect the disposable income of many consumers and may lower demand for some of our products.
Any compounds that we discover or in-license will require extensive and costly development, preclinical testing and clinical trials prior to seeking regulatory approval for commercial sales. Our most advanced product candidate, Adva-27a, and our potential Covid-19 treatments in development, may never be approved for commercial sale.
We may not receive required regulatory approval for any of our non-generic pharmaceutical product candidates We have not received approval for any of our proprietary (non-generic) drug development operations product candidates from the FDA. Any compounds we discover or in-license will require extensive and costly development, preclinical testing and clinical trials prior to seeking regulatory approval for commercial sales.
If we are unable to submit a new drug application, or NDA for our product candidates, we will be unable to commercialize such products and our business will be materially harmed. The FDA can and does reject NDAs, and often requires additional clinical trials, even when product candidates performed well or achieved favorable results in large-scale Phase III clinical trials.
The FDA may not approve in a timely manner, or at all, any of our drug candidates. If we are unable to submit a new drug application for our product candidates, we will be unable to commercialize such products and our business will be materially harmed.
Our business exposes us to potential product liability risks that are inherent in the testing, manufacturing and marketing of pharmaceutical products and OTC supplements. The use of our product candidates in clinical trials also exposes us to the possibility of product liability claims and possible adverse publicity.
The use of our products by our customers exposes us to the possibility of product liability claims and possible adverse publicity. These risks will increase to the extent our pharmaceutical product candidates receive regulatory approval and are commercialized.
The occurrence of these or any other operational problems at such facilities may have a material adverse effect on our business, financial condition and results of operations. 17 Risks Related to Our Common Stock There is a limited market for our common stock, and investors may find it difficult to buy and sell our shares.
The occurrence of these or any other operational problems, including the improper installation or operation of equipment, terrorism, pandemics (including Covid-19), natural or other disasters, intentional acts of violence, and the need to comply with the requirements or directives of governmental agencies, including the FDA and Health Canada may have a material adverse effect on our business, financial condition and results of operations. 15 Risks Related to Our Common Stock There is significant volatility in the price and trading volume of our common stock, and investors may find it difficult to buy and sell our shares Our common stock has been listed on the Nasdaq Capital Market since February 15, 2022.
Brand companies may seek to delay introductions of generic equivalents through a variety of commercial and regulatory tactics. These actions may increase the costs and risks of our efforts to introduce generic products and may delay or prevent such introduction altogether. We may experience delays in launches of our new generic products.
Brand companies may seek to delay introductions of generic equivalents through a variety of commercial and regulatory tactics.
Our success will depend to a large degree on our own and our licensors’ ability to obtain and defend patents for each party's respective technologies and the compounds and other products, if any, resulting from the application of such technologies. The patent positions of pharmaceutical and biotechnology companies can be highly uncertain and involve complex legal and technical questions.
Sales of similar products by competitors may materially and adversely affect our business, financial condition, and results of operations. 13 Because our proprietary drug product candidates and our development and collaboration efforts depend on our intellectual property rights, adverse events affecting our intellectual property rights will harm our ability to commercialize products Our success will depend to a large degree on our own and our licensors’ ability to obtain and defend patents for each party's respective technologies and the compounds and other products, if any, resulting from the application of such technologies.
Failure or delays to execute launches of new generic products could have a material adverse effect on our business, financial condition, and results of operations. We may not receive required regulatory approval for any of our non-generic pharmaceutical product candidates. We have not received approval for any of our proprietary (non-generic) drug development operations product candidates from the FDA.
Such unsuccessful launches can be caused by many factors, including delays in regulatory approvals, lack of operational or clinical readiness or patent litigation. Failure or delays to execute launches of new generic products could have a material adverse effect on our business, financial condition, and results of operations.
Slilaty for strategic and operational management, as well as for scientific and/or medical expertise in the development of our products. The loss of Dr. Slilaty would result in a significant negative impact on our ability to implement our business plan. We have not entered into an employment agreement with any member of our management, including Dr. Slilaty.
Slilaty would result in a significant negative impact on our ability to implement our business plan. The loss of Dr. Slilaty will also significantly delay or prevent the achievement of our business objectives.
No consistent policy regarding the breadth of claims allowed in biotechnology patents has emerged to date.
The patent positions of pharmaceutical and biotechnology companies can be highly uncertain and involve complex legal and technical questions. No consistent policy regarding the breadth of claims allowed in biotechnology patents has emerged to date. Accordingly, we cannot predict the breadth of claims that will be allowed or maintained, after challenge, in our or other companies' patents.
Any such disruptions could have a material adverse impact on our business and our results of operation and financial condition. Sales of our generic products may be adversely affected by the drug regulatory environment in Canada. Currently we sell our generic drugs only in Canada.
Any such disruptions could have a material adverse impact on our business and our results of operation and financial condition. 7 Other risks associated with our generic pharmaceutical business include: · Current macroeconomic conditions are becoming increasingly less stable due to the war in Ukraine, and tensions in the Middle and Far East.
Removed
The FDA may change its approval policies or requirements, or apply interpretations to its policies or requirements, in a manner that could delay or prevent commercialization of Adva-27a or our potential Covid-19 treatment in development.
Added
Destabilized macroeconomics conditions pose a serious threat to supply chains around the world including those for the generic pharmaceutical business.
Removed
The product candidate we are developing for the treatment of Covid-19 may not be granted an emergency use authorization by the FDA. If we do not receive such authorization, or if, once granted, it is terminated, we will be required to pursue the drug approval process, which is lengthy and expensive.
Added
Nearly all of Nora Pharma’s generic drugs are manufactured outside Canada and the United States and could experience disruptions which would adversely affect our main source of revenue. · Supply chains discontinuities due to other issues, including unforeseen regulatory actions, economic sanctions, trade restrictions, labor disturbances and approval delays, may impact our ability to timely meet customer demand in certain instances.
Removed
Subject to completing and receiving favorable results for clinical trials, we intend to seek emergency use authorization, or EUA, for a potential Covid-19 treatment, which would allow us to market and sell such product candidate without the need to pursue the lengthy and expensive drug approval process.
Added
These adverse market forces would have a direct impact on our ability to achieve our sales projections. · A significant portion of Nora Pharma’s revenues are derived from relatively few key customers, and any financial difficulties experienced by a single key customer, or any delay in receiving payments from such a customer, could have a material adverse effect on Nora Pharma’s business, financial condition, and results of operations. · If Nora Pharma encounters difficulties in executing launches of new products, it may not be able to offset the increasing price erosion on existing products resulting from pricing pressures and accelerated generics approvals for competitors.
Removed
The FDA may issue an EUA during a public health emergency if it determines that the potential benefits of a product outweigh the potential risks and if other regulatory criteria are met. In addition, the FDA may revoke an EUA where it is determined that the underlying health emergency no longer exists or warrants such authorization.
Added
Such unsuccessful launches can be caused by many factors, including delays in regulatory approvals, lack of operational or clinical readiness or patent litigation. Failure or delays to execute launches of new generic products could have a material adverse effect on Nora Pharma’s business and its ability to realize projected sales.
Removed
We may not receive EUA for any Covid-19 treatment product candidate. In addition, even if we do receive EUA for any product candidate, we cannot predict how long such EUA will remain in place.
Added
If we fail to obtain required regulatory approvals for our pharmaceutical product candidates, our business will be materially harmed.
Removed
If we fail to receive an EUA for any Covid-19 product candidate, or such EUA is granted but subsequently terminated, our business, financial condition and results of operations could be adversely affected. Our business would be materially harmed if we fail to obtain FDA approval for our pharmaceutical product candidates.
Added
In addition, an unfavorable outcome in any such litigation could have a material adverse effect on our business, results of operations and cash flows. If we are unable to attract and retain qualified scientific, technical, and key management personnel, or if our key executive, Dr. Steve N.
Removed
We anticipate that our ability to generate significant product revenues from our drug development business will depend on the successful development and commercialization of Adva-27a or our potential Covid-19 treatment in development. The FDA may not approve in a timely manner, or at all, any of our drug candidates.
Added
This would adversely affect our ability to generate revenues and may damage our reputation in the industry and in the investment community.
Removed
In addition, delays or rejections may be encountered based on changes in, or additions to, regulatory policies for drug approval during product development and regulatory review.
Added
The biotechnology and pharmaceutical industries are intensely competitive and subject to rapid and significant technological change. The drugs that we are attempting to develop will compete with existing therapies if we receive marketing approval.
Removed
Government regulation may delay or prevent the commencement of clinical trials or marketing of our product candidates, impose costly procedures upon our activities and provide an advantage to our competitors with greater financial resources or more experience in regulatory affairs. The FDA may not approve our product candidates for clinical trials or marketing on a timely basis or at all.
Added
To successfully develop our products, we will need to manage operating, producing, marketing and selling our products. There can be no assurances that we will be able to do so.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES Our principal place of business is located at 6500 Trans-Canada Highway, 4th Floor, Pointe-Claire, Quebec, Canada H9R 0A5. We are not party to a lease agreement in connection with this office service.
Biggest changeITEM 2. PROPERTIES Our principal place of business is located at 1177 Avenue of the Americas, 5 th Floor, New York, NY 10036. We also have a satellite office in the greater Montreal area located at 6500 Trans-Canada Highway, 4 th Floor, Pointe-Claire, Quebec, Canada H9R 0A5.
Our wholly owned subsidiary, Nora Pharma, currently occupies a 15,000 square foot facility located at 1565 Boulevard Lionel-Boulet, Varennes, Quebec, Canada, J3X 1P7 pursuant to a lease agreement that expires January 31, 2025, with an option to extend for 5 years.
Our wholly owned subsidiary, Nora Pharma, currently occupies a 23,500 square foot facility located at 1565 Boulevard Lionel-Boulet, Varennes, Quebec, Canada, J3X 1P7 pursuant to a lease agreement that expires in January 2030, with an option to extend for 5 years. This site is composed of 18,500 square feet of warehouse space and 5,000 square feet of executive office space.
This site is comprised of 15,000 square feet that includes 10,000 square feet of warehouse space and 5,000 square feet of executive office space. The facility houses all administrative, marketing, quality control, regulatory affairs, and other operations personal, as well as, a Health Canada licensed warehouse space. We pay a monthly rent of $17,250 CAD (approximately $12,750 USD), including taxes.
The facility houses all administrative, marketing, quality control, regulatory affairs, and other operations personal, as well as a Health Canada licensed warehouse space. We pay a monthly rent of $27,250 CAD (approximately $19,900 USD), including taxes.
Removed
We are currently looking into leasing dedicated office space of approximately 8,000 square feet adjacent to our recently acquired subsidiary, Nora Pharma at 1565 Boulevard Lionel-Boulet, Varennes, Quebec, Canada J3X 1P7.
Added
We are not party to lease agreements in connection with these two office locations. We pay rent month-to-month and have access to additional space on a pay-per-use basis.
Added
We estimate that this facility is adequate for annual sales of approximately $50 to $75 million, past which we will need to find additional space.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe also have tradeable warrants listed on the Nasdaq Capital Market under the symbol “SBFMW”. As of March 31, 2023, there were approximately 149 holders of record of our common stock, not including those holding their shares in “street name.” Equity Compensation Plan Information We did not have any equity compensation plans as of December 31, 2022.
Biggest changeAs of March 28, 2024, there were approximately 149 holders of record of our common stock, not including those holding their shares in “street name.” Equity Compensation Plan Information The following table sets forth information regarding our equity compensation plans as of December 31, 2023: Plan Category Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans Equity compensation plans approved by security holders (1) – – 3,320,988 Equity compensation plans not approved by security holders – – – (1) Represents our 2023 Equity Incentive Plan.
We intend to submit a stock option plan for approval to our shareholders at our 2023 Annual Shareholder Meeting. Dividend Policy We have not paid any dividends since our incorporation and do not anticipate paying any dividends in the foreseeable future. At present, our policy is to retain earnings, if any, to develop and market our products.
Dividend Policy We have not paid any dividends since our incorporation and do not anticipate paying any dividends in the foreseeable future. At present, our policy is to retain earnings, if any, to develop and market our products. Our payment of dividends in the future will depend upon, among other factors, our earnings, capital requirements, and operating financial conditions.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Prior to February 15, 2022, our common stock was quoted on the OTC Pink under the symbol “SBFM.” Since February 15, 2022, our common stock has been listed on the Nasdaq Capital Market under the symbol “SBFM”.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock is listed on the Nasdaq Capital Market under the symbol “SBFM”. As of March 28, 2024, we had a total of 99,452,865 shares of our common stock issued and outstanding.
Removed
Our payment of dividends in the future will depend upon, among other factors, our earnings, capital requirements, and operating financial conditions. Recent Sales of Unregistered Securities None. ITEM 6. [RESERVED]
Added
We also have tradeable warrants exercisable to purchase shares of our common stock listed on the Nasdaq Capital Market under the symbol “SBFMW.” As of March 28, 2024, we had a total of 963,693 tradeable warrants outstanding.
Added
Recent Sales of Unregistered Securities None. ITEM 6. [RESERVED]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeResults of Operations Comparison of Results of Operations for the fiscal years ended December 31, 2022 and 2021 During our fiscal year ended December 31, 2022, we generated revenues of $4,345,603, compared to revenues of $228,426, in 2021. The increase was the result of our acquisition of Nora Pharma in October 2022, which accounted for $3,803,106 of these revenues.
Biggest changePlease see “Cautionary Note Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements. 18 Results of Operations Comparison of Results of Operations for the fiscal years ended December 31, 2023 and 2022 During our fiscal year ended December 31, 2023, we generated revenues of $24,092,787, compared to revenues of $4,345,603 in 2022.
We have no committed sources of capital and we anticipate that we will need to raise additional capital in the future, including for further research and development activities and possibly clinical trials, as well as expansion of our generic pharmaceuticals operations arising from the Nora Pharma acquisition.
There is no assurance our estimates will be accurate. We have no committed sources of capital and we anticipate that we will need to raise additional capital in the future, including for further research and development activities and possibly clinical trials, as well as expansion of our generic pharmaceuticals operations.
Net cash flows provided by financing activities were $39,465,107 in 2022 compared to $2,904,675 in 2021. The increase was primarily a result of the three (3) rounds of financing which took place in February, March, and April 2022. Net cash used in operations was $5,248,358 in 2022, compared to $1,829,128 in 2021.
Net cash flows provided by financing activities were $3,425,587 in 2023, compared to $39,465,107 in 2022. The decrease was primarily a result of three (3) rounds of financing which took place in February, March, and April 2022 and only one (1) relatively small financing in 2023. Net cash used in operations was $8,775,111 in 2023, compared to $5,248,358 in 2022.
Our wholly owned subsidiary, Nora Pharma, currently occupies a 15,000 square foot facility located at 1565 Boulevard Lionel-Boulet, Varennes, Quebec, Canada, J3X 1P7 pursuant to a lease agreement that expires January 31, 2025, with an option to extend for 5 years.
Our wholly owned subsidiary, Nora Pharma, currently occupies a 23,500 square foot facility located at 1565 Boulevard Lionel-Boulet, Varennes, Quebec, Canada, J3X 1P7 pursuant to a lease agreement that expires in January 2030, with an option to extend for 5 years. This site is composed of 18,500 square feet of warehouse space and 5,000 square feet of executive office space.
This site is comprised of 15,000 square feet that includes 10,000 square feet of warehouse space and 5,000 square feet of executive office space. The facility houses all administrative, marketing, quality control, regulatory affairs, and other operations personal, as well as, a Health Canada licensed warehouse space. We pay a monthly rent of $17,250 CAD (approximately $12,750 USD), including taxes.
The facility houses all administrative, marketing, quality control, regulatory affairs, and other operations personal, as well as a Health Canada licensed warehouse space. We pay a monthly rent of $27,250 CAD (approximately $19,900 USD), including taxes.
This discussion should be read in conjunction with our financial statements and the related notes included in this report. This discussion contains forward-looking statements. Please see “Cautionary Note Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with these forward-looking statements.
This discussion should be read in conjunction with our financial statements and the related notes included in this report. This discussion contains forward-looking statements.
As a result, we incurred a net loss of $26,511,136 for the year ended December 31, 2022, compared to a net loss of $12,436,447 for the year ended December 31, 2021. 20 Liquidity and Capital Resources As of December 31, 2022, we had cash and cash equivalents of $21,826,437.
As a result, we incurred a net loss of $4,506,044 for the year ended December 31, 2023, compared to a net loss of $26,744,440 for the year ended December 31, 2022. Liquidity and Capital Resources As of December 31, 2023, we had cash and cash equivalents of $16,292,347.
We repaid this note following the closing of our public offering in February 2022. 21 Cash flows used in investing activities were $14,619,390 during the year ended December 31, 2022, compared to $0 during our fiscal year ended December 31, 2021. The reason for the increase was due to the acquisition of Nora Pharma.
Cash flows used in investing activities were $656,150 during the year ended December 31, 2023, compared to $14,619,390 during our fiscal year ended December 31, 2022. The reason for the decrease was due to the acquisition of Nora Pharma which took place on October 20, 2022.
Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.
Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company is evaluating the impact of this guidance on its unaudited consolidated financial statements. 20 Off-Balance Sheet Arrangements We have not entered into any off-balance sheet arrangements.
On March 14, 2022, we received net proceeds of approximately $6.8 million from the sale of common stock and warrants in a private placement. On April 28, 2022, we received net proceeds of approximately $16.8 million from the sale of common stock and warrants in a private placement.
During the fiscal years ended December 31, 2022 and 2023, we received aggregate proceeds of $13,196,681 in connection with warrant exercises. On May 16, 2023, we completed a private placement of common stock and warrants for gross proceeds of approximately $5 million. We received net proceeds of approximately $4.1 million from the private placement.
The reason for the increase was the acquisition of Nora Pharma. We are not generating adequate revenues from our operations to fully implement our business plan as set forth herein. On February 17, 2022, we received net proceeds of approximately $6.8 million from the sale of common stock and warrants in an underwritten public offering.
The increase was due to expansion of Nora Pharma drugs portfolio. 19 We are not generating adequate revenues from our operations to fully implement our business plan as set forth herein. We believe our existing cash will be sufficient to fund our pharmaceuticals sales operations and research and development activities for the next 24 months.
The cost of sales in 2022 and 2021 for generating these revenues was $2,649,028 and $117,830, respectively. General and administrative expenses for our fiscal year ended December 31, 2022, were $28,697,325, compared to $2,550,730 during our fiscal year ended December 31, 2021, an increase of $26,146,595.
General and administrative (“G&A”) expenses for our fiscal year ended December 31, 2023, were $13,124,470, compared to $28,697,325 during our fiscal year ended December 31, 2022, a decrease of $15,572,855. However, excluding the one-time impairment of goodwill in the amount of $18,326,719 from the 2022 G&A expenses, reveals an increase in G&A expenses of $2,753,864 in 2023.
Removed
The increase was largely a result of goodwill impairment of $18,326,719 and costs and expenses relating to the Nora Pharma acquisition. We also incurred $39,412 in interest expense and $0 in losses from debt conversion in 2022, compared to $328,818 in interest expense and $9,726,485 in losses from debt conversion in 2021.
Added
The increase was the result of twelve months of Nora Pharma sales included in the 2023 results compared to only seventy-two days of sales in 2022 (October 20, 2022, the date of acquisition of Nora Pharma, through December 31, 2022). The cost of sales in 2023 and 2022 for generating these revenues was $15,753,616 and $2,649,028, respectively.
Removed
The decrease in interest expense and losses from debt conversion in 2022 was due to our repayment of all outstanding debt in 2022.
Added
This increase is due to G&A expenses incurred by Nora Pharma during all of 2023, compared to only 72 days of G&A expenses included in 2022. We had interest income of $811,974 in 2023, compared to interest income of $518,650 in 2022. We incurred $137,308 in interest expense in 2023, compared to $39,412 in interest expense in 2022.
Removed
During the fiscal year ended December 31, 2022, we received aggregate proceeds of $13,193,177 in connection with warrant exercises.
Removed
During the year ended December 31, 2021, we issued a total of 559,144 shares of our common stock valued at $12,705,214 for the conversion of outstanding notes payable, reducing the debt by $2,867,243 and interest payable by $127,986 and generating a loss on conversion of $9,726,485.
Removed
During the year ended December 31, 2021, we did not sell any of our capital stock for cash; however, we entered into the following new debt arrangements: · On January 12, 2021, we issued a note in the principal amount of $150,000 with interest accruing at 5% per year, due January 12, 2023.
Removed
The note was convertible after 180 days from issuance into common stock at a price of $0.30 per share. This note was converted to common stock on December 20, 2021. · On January 27, 2021, we issued a note in the principal amount of $300,000 with interest accruing at 5% per year, due January 27, 2023.
Removed
The note was convertible after 180 days from issuance into common stock at a price equal to $0.50 per share. This note was converted to common stock on December 20, 2021. · On February 12, 2021, we issued a note in the principal amount of $700,000 with interest accruing at 5% per year, due February 12, 2023.
Removed
The note was convertible after 180 days from issuance into common stock at a price of $0.60 per share. This note was converted to common stock on December 20, 2021. · On April 5, 2021, we issued a note in the principal amount of $330,000 with interest accruing at 10% per year, due January 5, 2022.
Removed
The note was convertible after 180 days from issuance into common stock at a price 35% below market value. On October 13, 2021, the noteholder converted $330,000 in principal and $16,500 in accrued interest into 26,250 shares of common stock leaving a principal balance of $0.
Removed
We repaid this note · On April 20, 2021, we issued a note in the principal amount of $500,000 with interest accruing at 5% per year, due April 20, 2023. The note was convertible after 180 days from issuance into common stock at a price of $0.30 per share.
Removed
We repaid this note following the closing of our public offering in February 2022. · On July 6, 2021, we issued a note in the principal amount of $900,000 with interest accruing at 5% per year, due July 6, 2023. The note was convertible after 180 days from issuance into common stock at a price of $0.30 per share.
Removed
We repaid this note following the closing of our public offering in February 2022.
Removed
In connection with this debt financing, we agreed to allow the lender, who is also the holder of a note dated November 25, 2020, to convert a total of $240,000 in principal into 120,000 shares of common stock leaving a principal balance of $10,000 and accrued interest of $7,750.
Removed
On July 6, 2021, we paid off the remaining principal balance of this note and received forgiveness of the accrued interest. · On August 18, 2021, we issued a note in the principal amount of $500,000 with interest accruing at 5% per year, due August 18, 2023.
Removed
The note is convertible after 180 days from issuance into common stock at a price equal to $0.30 per share.
Removed
We believe our existing cash will be sufficient to fund our operations, including general and administrative expenses, expanded research and development activities, and OTC supplements business, for the next 24 months. There is no assurance our estimates will be accurate.
Removed
The Company is evaluating the impact of this guidance on its unaudited consolidated financial statements. 22 Off-Balance Sheet Arrangements We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources and would be considered material to investors.

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