[10-Q] Coeptis Therapeutics Holdings Inc. Quarterly Earnings Report
Coeptis Therapeutics Holdings, Inc. reported interim financials showing operating losses and financing activity. For the six months ended June 30, 2025, the Company recorded a net loss of $7,755,527 and management states these conditions raise substantial doubt about the Company’s ability to continue as a going concern. The Company completed a retrospective 20-for-1 reverse stock split, with 4,166,713 shares issued and outstanding at June 30, 2025 (4,820,317 noted as outstanding as of August 13, 2025). Debt and capital transactions were active: a $1,304,758 convertible note was converted by Yorkville (including $52,505 of accrued interest) into 233,500 shares at an average $5.81 conversion price, and the Company recognized a $906,429 gain on change in fair value of a derivative liability during the six months. The Company shows various convertible notes, a $150,000 SBA EIDL balance, warrant liabilities, investments recorded for transferred subscription receivables, and $1,344,750 of unamortized stock-based compensation for options. Management plans to raise additional equity or debt to fund operations, but states no assurance of success.
Coeptis Therapeutics Holdings, Inc. ha comunicato risultati interim che mostrano perdite operative e attività di finanziamento. Nei sei mesi terminati il 30 giugno 2025 la Società ha riportato una perdita netta di $7.755.527 e la direzione dichiara che tali condizioni generano seri dubbi sulla capacità dell’azienda di proseguire come entità in funzionamento. La Società ha effettuato retroattivamente un raggruppamento azionario inverso 20-contro-1, con 4.166.713 azioni emesse e in circolazione al 30 giugno 2025 (4.820.317 segnalate come in circolazione al 13 agosto 2025). Le operazioni su debito e capitale sono state attive: una cambiale convertibile da $1.304.758 è stata convertita da Yorkville (inclusi $52.505 di interessi maturati) in 233.500 azioni a un prezzo medio di conversione di $5,81, e la Società ha rilevato un utile di $906.429 derivante dalla variazione del fair value di una passività derivata durante i sei mesi. La Società riporta varie cambiali convertibili, un saldo SBA EIDL di $150.000, passività per warrant, investimenti contabilizzati per crediti di sottoscrizione trasferiti e $1.344.750 di compensi azionari non ammortizzati relativi a opzioni. La direzione prevede di raccogliere capitale aggiuntivo o indebitarsi per finanziare le operazioni, ma non garantisce il successo di tali iniziative.
Coeptis Therapeutics Holdings, Inc. informó estados financieros interinos que muestran pérdidas operativas y actividad de financiación. En los seis meses terminados el 30 de junio de 2025, la Compañía registró una pérdida neta de $7,755,527 y la gerencia indica que estas condiciones plantean dudas sustanciales sobre la capacidad de la Compañía para continuar como empresa en marcha. La Compañía completó retroactivamente una consolidación de acciones inversa 20 a 1, con 4,166,713 acciones emitidas y en circulación al 30 de junio de 2025 (4,820,317 informadas como en circulación al 13 de agosto de 2025). Hubo actividad en transacciones de deuda y capital: una nota convertible de $1,304,758 fue convertida por Yorkville (incluyendo $52,505 de intereses acumulados) en 233,500 acciones a un precio medio de conversión de $5.81, y la Compañía reconoció una ganancia de $906,429 por cambio en el valor razonable de un pasivo por derivados durante los seis meses. La Compañía presenta varias notas convertibles, un saldo SBA EIDL de $150,000, pasivos por warrants, inversiones registradas por cuentas por suscripción transferidas y $1,344,750 de compensación basada en acciones no amortizada por opciones. La gerencia planea recaudar capital adicional o deuda para financiar las operaciones, pero no ofrece garantía de éxito.
Coeptis Therapeutics Holdings, Inc.는 영업 손실과 자금 조달 활동을 보여주는 잠정 재무 결과를 보고했습니다. 2025년 6월 30일로 끝나는 6개월 동안 회사는 순손실 $7,755,527을 기록했으며, 경영진은 이러한 상황이 회사의 계속기업 존속 능력에 대해 중대한 의문을 제기한다고 밝혔습니다. 회사는 소급 적용된 20대1 액면병합(리버스 스플릿)을 완료했으며, 2025년 6월 30일 기준 발행 및 유통 주식 수는 4,166,713주였습니다(2025년 8월 13일 기준 4,820,317주로 기재됨). 부채 및 자본 거래가 활발히 이루어졌습니다: $1,304,758의 전환사채가 Yorkville에 의해(미지급 이자 $52,505 포함) 평균 전환가 $5.81로 233,500주로 전환되었고, 회사는 6개월 동안 파생부채 공정가치 변동으로 인한 $906,429의 이득을 인식했습니다. 회사는 여러 전환사채, $150,000의 SBA EIDL 잔액, 워런트 부채, 양도된 청약채권에 대한 투자, 그리고 옵션 관련 미상각 주식보상액 $1,344,750을 보고하고 있습니다. 경영진은 운영자금 조달을 위해 추가 자본 또는 부채를 조달할 계획이지만 성공을 보장하지는 않습니다.
Coeptis Therapeutics Holdings, Inc. a publié des états financiers intermédiaires montrant des pertes d'exploitation et des opérations de financement. Pour les six mois clos le 30 juin 2025, la Société a enregistré une perte nette de 7 755 527 $ et la direction indique que ces conditions soulèvent d'importants doutes quant à la capacité de la Société à poursuivre son activité. La Société a réalisé rétroactivement une fusion d'actions inverse 20 pour 1, avec 4 166 713 actions émises et en circulation au 30 juin 2025 (4 820 317 signalées en circulation au 13 août 2025). Les opérations de dette et de capital ont été actives : une note convertible de 1 304 758 $ a été convertie par Yorkville (y compris 52 505 $ d'intérêts courus) en 233 500 actions à un prix moyen de conversion de 5,81 $, et la Société a comptabilisé un gain de 906 429 $ lié à la variation de la juste valeur d'un passif dérivé au cours des six mois. La Société présente diverses notes convertibles, un solde SBA EIDL de 150 000 $, des passifs liés aux bons de souscription, des investissements comptabilisés pour des créances de souscription transférées et 1 344 750 $ de rémunération en actions non amortie liée aux options. La direction prévoit de lever des capitaux propres ou de la dette supplémentaires pour financer les opérations, sans garantir le succès.
Coeptis Therapeutics Holdings, Inc. meldete Zwischenabschlüsse, die operative Verluste und Finanzierungstätigkeiten zeigen. Für die sechs Monate zum 30. Juni 2025 verzeichnete das Unternehmen einen Nettoverlust von $7.755.527 und das Management erklärt, dass diese Umstände erhebliche Zweifel an der Fähigkeit des Unternehmens begründen, als fortgeführtes Unternehmen weiterzubestehen. Das Unternehmen führte rückwirkend einen 20-zu-1 Reverse-Stock-Split durch; zum 30. Juni 2025 waren 4.166.713 Aktien ausgegeben und ausstehend (am 13. August 2025 wurden 4.820.317 als ausstehend angegeben). Schulden- und Kapitaltransaktionen waren aktiv: eine wandelbare Schuldverschreibung über $1.304.758 wurde von Yorkville (einschließlich $52.505 aufgelaufener Zinsen) in 233.500 Aktien zu einem durchschnittlichen Umwandlungspreis von $5,81 umgewandelt, und das Unternehmen erkannte einen Gewinn von $906.429 aus der Änderung des beizulegenden Zeitwerts einer derivativen Verbindlichkeit innerhalb der sechs Monate. Das Unternehmen weist verschiedene wandelbare Schuldverschreibungen, einen SBA EIDL-Saldo von $150.000, Optionsverbindlichkeiten, als übertragen verbuchte Zeichnungsforderungen als Investitionen und nicht abgegrenzte aktienbasierte Vergütungen in Höhe von $1.344.750 für Optionen aus. Das Management plant, zusätzliches Eigen- oder Fremdkapital zur Finanzierung des Betriebs zu beschaffen, gibt jedoch keine Erfolgsgarantie.
- Completed 20-for-1 reverse stock split and retrospectively applied to all periods presented, simplifying the share structure.
- Yorkville conversion$906,429 gain on derivative fair value.
- Recorded unrealized gain of $390,566
- Net loss of $7,755,527
- Management states substantial doubt
- Multiple convertible notes, warrants, and standby equity purchase arrangements
- Defaulted and amended debt instruments
- Related-party financing
Insights
TL;DR: Significant losses, going-concern doubts, and reliance on equity/debt financings make near-term dilution and liquidity risk primary investor concerns.
The Company reported a six-month net loss of $7.8 million and explicitly discloses substantial doubt about its ability to continue as a going concern. Capital structure activity is material: Yorkville conversions reduced the convertible note principal and triggered a recognized gain on derivative fair value of $906,429. Multiple convertible instruments, a standby equity purchase arrangement mechanism, and outstanding warrants create potential dilution. Short-term liabilities include a $150,000 SBA loan and several convertible and payable notes with amended maturities and defaulted balances. Management’s stated plan is to raise equity or debt to sustain operations, but the filing contains no committed financing. From a financial analysis perspective, liquidity risk and dilution from convertible instruments are the most important near-term issues.
TL;DR: Board-authorized capital actions, reverse split, and related-party preferred financing indicate active capital management but raise governance and related-party transparency considerations.
The filing documents a retrospective 20-for-1 reverse stock split and significant preferred stock financings, including Series A preferred stock purchases led by a board member-controlled entity. Related-party transactions are disclosed (e.g., AG Note settlement via transferred shares). The board retains broad authority over preferred series terms. Significant option and warrant grants, including immediate exercisable pre-funded warrants and multiple warrant series, expand possible future claimants on equity. These facts require clear disclosure and robust conflict-of-interest controls; the filing provides disclosures but investors should note concentration of financing decisions and material related-party involvement as governance-relevant facts.
Coeptis Therapeutics Holdings, Inc. ha comunicato risultati interim che mostrano perdite operative e attività di finanziamento. Nei sei mesi terminati il 30 giugno 2025 la Società ha riportato una perdita netta di $7.755.527 e la direzione dichiara che tali condizioni generano seri dubbi sulla capacità dell’azienda di proseguire come entità in funzionamento. La Società ha effettuato retroattivamente un raggruppamento azionario inverso 20-contro-1, con 4.166.713 azioni emesse e in circolazione al 30 giugno 2025 (4.820.317 segnalate come in circolazione al 13 agosto 2025). Le operazioni su debito e capitale sono state attive: una cambiale convertibile da $1.304.758 è stata convertita da Yorkville (inclusi $52.505 di interessi maturati) in 233.500 azioni a un prezzo medio di conversione di $5,81, e la Società ha rilevato un utile di $906.429 derivante dalla variazione del fair value di una passività derivata durante i sei mesi. La Società riporta varie cambiali convertibili, un saldo SBA EIDL di $150.000, passività per warrant, investimenti contabilizzati per crediti di sottoscrizione trasferiti e $1.344.750 di compensi azionari non ammortizzati relativi a opzioni. La direzione prevede di raccogliere capitale aggiuntivo o indebitarsi per finanziare le operazioni, ma non garantisce il successo di tali iniziative.
Coeptis Therapeutics Holdings, Inc. informó estados financieros interinos que muestran pérdidas operativas y actividad de financiación. En los seis meses terminados el 30 de junio de 2025, la Compañía registró una pérdida neta de $7,755,527 y la gerencia indica que estas condiciones plantean dudas sustanciales sobre la capacidad de la Compañía para continuar como empresa en marcha. La Compañía completó retroactivamente una consolidación de acciones inversa 20 a 1, con 4,166,713 acciones emitidas y en circulación al 30 de junio de 2025 (4,820,317 informadas como en circulación al 13 de agosto de 2025). Hubo actividad en transacciones de deuda y capital: una nota convertible de $1,304,758 fue convertida por Yorkville (incluyendo $52,505 de intereses acumulados) en 233,500 acciones a un precio medio de conversión de $5.81, y la Compañía reconoció una ganancia de $906,429 por cambio en el valor razonable de un pasivo por derivados durante los seis meses. La Compañía presenta varias notas convertibles, un saldo SBA EIDL de $150,000, pasivos por warrants, inversiones registradas por cuentas por suscripción transferidas y $1,344,750 de compensación basada en acciones no amortizada por opciones. La gerencia planea recaudar capital adicional o deuda para financiar las operaciones, pero no ofrece garantía de éxito.
Coeptis Therapeutics Holdings, Inc.는 영업 손실과 자금 조달 활동을 보여주는 잠정 재무 결과를 보고했습니다. 2025년 6월 30일로 끝나는 6개월 동안 회사는 순손실 $7,755,527을 기록했으며, 경영진은 이러한 상황이 회사의 계속기업 존속 능력에 대해 중대한 의문을 제기한다고 밝혔습니다. 회사는 소급 적용된 20대1 액면병합(리버스 스플릿)을 완료했으며, 2025년 6월 30일 기준 발행 및 유통 주식 수는 4,166,713주였습니다(2025년 8월 13일 기준 4,820,317주로 기재됨). 부채 및 자본 거래가 활발히 이루어졌습니다: $1,304,758의 전환사채가 Yorkville에 의해(미지급 이자 $52,505 포함) 평균 전환가 $5.81로 233,500주로 전환되었고, 회사는 6개월 동안 파생부채 공정가치 변동으로 인한 $906,429의 이득을 인식했습니다. 회사는 여러 전환사채, $150,000의 SBA EIDL 잔액, 워런트 부채, 양도된 청약채권에 대한 투자, 그리고 옵션 관련 미상각 주식보상액 $1,344,750을 보고하고 있습니다. 경영진은 운영자금 조달을 위해 추가 자본 또는 부채를 조달할 계획이지만 성공을 보장하지는 않습니다.
Coeptis Therapeutics Holdings, Inc. a publié des états financiers intermédiaires montrant des pertes d'exploitation et des opérations de financement. Pour les six mois clos le 30 juin 2025, la Société a enregistré une perte nette de 7 755 527 $ et la direction indique que ces conditions soulèvent d'importants doutes quant à la capacité de la Société à poursuivre son activité. La Société a réalisé rétroactivement une fusion d'actions inverse 20 pour 1, avec 4 166 713 actions émises et en circulation au 30 juin 2025 (4 820 317 signalées en circulation au 13 août 2025). Les opérations de dette et de capital ont été actives : une note convertible de 1 304 758 $ a été convertie par Yorkville (y compris 52 505 $ d'intérêts courus) en 233 500 actions à un prix moyen de conversion de 5,81 $, et la Société a comptabilisé un gain de 906 429 $ lié à la variation de la juste valeur d'un passif dérivé au cours des six mois. La Société présente diverses notes convertibles, un solde SBA EIDL de 150 000 $, des passifs liés aux bons de souscription, des investissements comptabilisés pour des créances de souscription transférées et 1 344 750 $ de rémunération en actions non amortie liée aux options. La direction prévoit de lever des capitaux propres ou de la dette supplémentaires pour financer les opérations, sans garantir le succès.
Coeptis Therapeutics Holdings, Inc. meldete Zwischenabschlüsse, die operative Verluste und Finanzierungstätigkeiten zeigen. Für die sechs Monate zum 30. Juni 2025 verzeichnete das Unternehmen einen Nettoverlust von $7.755.527 und das Management erklärt, dass diese Umstände erhebliche Zweifel an der Fähigkeit des Unternehmens begründen, als fortgeführtes Unternehmen weiterzubestehen. Das Unternehmen führte rückwirkend einen 20-zu-1 Reverse-Stock-Split durch; zum 30. Juni 2025 waren 4.166.713 Aktien ausgegeben und ausstehend (am 13. August 2025 wurden 4.820.317 als ausstehend angegeben). Schulden- und Kapitaltransaktionen waren aktiv: eine wandelbare Schuldverschreibung über $1.304.758 wurde von Yorkville (einschließlich $52.505 aufgelaufener Zinsen) in 233.500 Aktien zu einem durchschnittlichen Umwandlungspreis von $5,81 umgewandelt, und das Unternehmen erkannte einen Gewinn von $906.429 aus der Änderung des beizulegenden Zeitwerts einer derivativen Verbindlichkeit innerhalb der sechs Monate. Das Unternehmen weist verschiedene wandelbare Schuldverschreibungen, einen SBA EIDL-Saldo von $150.000, Optionsverbindlichkeiten, als übertragen verbuchte Zeichnungsforderungen als Investitionen und nicht abgegrenzte aktienbasierte Vergütungen in Höhe von $1.344.750 für Optionen aus. Das Management plant, zusätzliches Eigen- oder Fremdkapital zur Finanzierung des Betriebs zu beschaffen, gibt jedoch keine Erfolgsgarantie.
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| Quarterly REPORT PURSUANT to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
For the quarterly period ended
or
| TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transaction period from _____________ to _____________
Commission File No.
| (State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(
coeptistx.com
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of exchange on which registered |
Securities registered pursuant to Section 12(g) of the Act: Common Stock, par value $0.0001 per share
Indicate by check mark whether the registrant:
(1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act of 1934 during the past 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large Accelerated Filer ☐ | Accelerated Filer ☐ |
| Smaller Reporting Company | |
| Emerging Growth Company |
If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant
is a shell company (as defined in Rule 12(b)-2 of the Exchange Act). Yes ☐ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:
The number of shares outstanding of the registrant’s
common stock as of the latest practicable date was:
COEPTIS THERAPEUTICS, INC.
FORM 10-Q
For the Quarter Ended June 30, 2025
TABLE OF CONTENTS
| PART I – FINANCIAL INFORMATION | 3 |
| Item 1. | Unaudited Financial Statements | 3 |
| Condensed Consolidated Balance Sheets | 3 | |
| Condensed Consolidated Statements of Operations | 4 | |
| Condensed Consolidated Statements of Stockholders’ Equity | 5 | |
| Condensed Consolidated Statements of Cash Flows | 7 | |
| Condensed Consolidated Notes to Unaudited Financial Statements | 8 |
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 30 |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 36 |
| Item 4. | Controls and Procedures | 36 |
| PART II – OTHER INFORMATION | 37 |
| Item 1. | Legal Proceedings | 37 |
| Item 1A. | Risk Factors | 37 |
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 37 |
| Item 3. | Defaults Upon Senior Securities | 37 |
| Item 4. | Mine Safety Disclosures | 37 |
| Item 5. | Other Information | 37 |
| Item 6. | Exhibits | 37 |
| SIGNATURES | 38 |
| 2 |
PART I — FINANCIAL INFORMATION
| Item 1. |
Unaudited Financial Statements |
COEPTIS THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
| As of | ||||||||
| June 30, 2025 (unaudited) | December 31, 2024 | |||||||
| ASSETS | ||||||||
| CURRENT ASSETS | ||||||||
| Cash | $ | $ | ||||||
| Accounts receivable | ||||||||
| Marketable securities | ||||||||
| Prepaid assets | ||||||||
| TOTAL CURRENT ASSETS | ||||||||
| PROPERTY AND EQUIPMENT | ||||||||
| Furniture and fixtures | ||||||||
| Less: accumulated depreciation | ||||||||
| Furniture and fixtures, net | ||||||||
| OTHER ASSETS | ||||||||
| Investments | ||||||||
| Intangible assets, net | ||||||||
| Co-development rights, net | ||||||||
| Right of use asset, net of accumulated amortization | ||||||||
| Total other assets | ||||||||
| TOTAL ASSETS | $ | $ | ||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||||||||
| CURRENT LIABILITIES | ||||||||
| Accounts payable | $ | $ | ||||||
| Accrued expenses | ||||||||
| Convertible notes payable, net of debt discount of $ | ||||||||
| Notes payable, current portion, in default | ||||||||
| Right of use liability, current portion | ||||||||
| Customer deposit | ||||||||
| Derivative liability | ||||||||
| Other current liabilities | ||||||||
| TOTAL CURRENT LIABILITIES | ||||||||
| LONG TERM LIABILITIES | ||||||||
| Note payable, net of current portion | ||||||||
| Derivative liability warrants | ||||||||
| Right of use liability, non-current portion | ||||||||
| TOTAL LONG TERM LIABILITIES | ||||||||
| TOTAL LIABILITIES | ||||||||
| COMMITMENTS AND CONTINGENCIES (NOTE 11) | – | |||||||
| STOCKHOLDERS' EQUITY | ||||||||
| Preferred stock, $ | ||||||||
| Common stock, $ | ||||||||
| Additional paid-in capital | ||||||||
| Subscription receivable | ( | ) | ( | ) | ||||
| Common stock subscribed | ||||||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| TOTAL STOCKHOLDERS' EQUITY - CONTROLLING INTERESTS | ||||||||
| TOTAL STOCKHOLDERS' EQUITY - NONCONTROLLING INTERESTS | ||||||||
| TOTAL STOCKHOLDERS' EQUITY | ||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ | $ | ||||||
The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.
| 3 |
COEPTIS THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(Unaudited)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, 2025 | June 30, 2024 | June 30, 2025 | June 30, 2024 | |||||||||||||
| SALES | ||||||||||||||||
| Sales | $ | $ | $ | $ | ||||||||||||
| Total sales | ||||||||||||||||
| Cost of goods | ||||||||||||||||
| Gross profit | ||||||||||||||||
| COST OF OPERATIONS | ||||||||||||||||
| Research and development expense | ||||||||||||||||
| Salary expense | ||||||||||||||||
| Amortization expense | ||||||||||||||||
| Professional services expense | ||||||||||||||||
| Stock based compensation expense | ||||||||||||||||
| General and administrative expenses | ||||||||||||||||
| Selling and marketing expense | – | |||||||||||||||
| Total cost of operations | ||||||||||||||||
| LOSS FROM OPERATIONS | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| OTHER INCOME (EXPENSE) | ||||||||||||||||
| Interest expense | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Other (expense) income, net | ( | ) | ( | ) | ||||||||||||
| Unrealized gain on marketable securities | – | – | ||||||||||||||
| Change in fair value of derivative liabilities | ( | ) | ( | ) | ||||||||||||
| TOTAL OTHER INCOME (EXPENSE), net | ( | ) | ( | ) | ||||||||||||
| LOSS BEFORE INCOME TAXES | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| PROVISION FOR INCOME TAXES (BENEFIT) | $ | $ | $ | $ | ||||||||||||
| NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTERESTS | ( | ) | ( | ) | ||||||||||||
| NET LOSS | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| LOSS PER SHARE | ||||||||||||||||
| Loss per share, basic and fully diluted | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Weighted average number of common shares outstanding | ||||||||||||||||
The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.
| 4 |
COEPTIS THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
For the Three and Six Months Ended June 30, 2025 and 2024
(Unaudited)
| ADDITIONAL | COMMON | |||||||||||||||||||||||
| PREFERRED STOCK | COMMON STOCK | PAID-IN | STOCK | |||||||||||||||||||||
| SHARES | AMOUNT | SHARES | AMOUNT | CAPITAL | SUBSCRIBED | |||||||||||||||||||
| BALANCE AT DECEMBER 31, 2023 | $ | $ | $ | $ | ||||||||||||||||||||
| Shares issued for non-employee services | – | – | – | |||||||||||||||||||||
| Warrants issued for cash | – | – | – | – | – | |||||||||||||||||||
| Warrants issued for services | – | – | – | – | – | |||||||||||||||||||
| Warrants issued in exchange for note receivable | – | – | – | – | – | |||||||||||||||||||
| Stock based compensation | – | – | – | – | – | |||||||||||||||||||
| Stock split adjustment | – | – | – | – | – | |||||||||||||||||||
| Net loss | – | – | – | – | – | – | ||||||||||||||||||
| BALANCE AT MARCH 31, 2024 | ||||||||||||||||||||||||
| Shares issued for services | – | – | – | |||||||||||||||||||||
| Shares issued for the conversion of debt | – | |||||||||||||||||||||||
| Preferred share offering | – | – | ||||||||||||||||||||||
| Stock based compensation | – | – | – | – | – | |||||||||||||||||||
| Stock split adjustment | – | – | – | – | – | |||||||||||||||||||
| Net loss | – | – | – | – | – | – | ||||||||||||||||||
| BALANCE AT JUNE 30, 2024 | $ | $ | $ | $ | ||||||||||||||||||||
| BALANCE AT DECEMBER 31, 2024 | $ | $ | $ | $ | ||||||||||||||||||||
| Series A Preferred Stock Offering | – | – | – | – | ||||||||||||||||||||
| Pre-funded warrants exercise | – | – | – | |||||||||||||||||||||
| Preferred share conversion | ( | ) | ( | ) | ( | ) | – | |||||||||||||||||
| Shares Issued for Services | – | – | – | – | ||||||||||||||||||||
| Shares Issued for SEPA | – | – | – | |||||||||||||||||||||
| Asset Purchase Agreement | – | – | ( | ) | ||||||||||||||||||||
| Stock based compensation | – | – | – | – | – | |||||||||||||||||||
| Warrants issued for services | – | – | – | – | – | |||||||||||||||||||
| Net loss | – | – | – | – | – | – | ||||||||||||||||||
| BALANCE AT MARCH 31, 2025 | ||||||||||||||||||||||||
| Pre-funded warrants exercise | – | – | – | |||||||||||||||||||||
| Preferred share conversion | ( | ) | – | ( | ) | – | ||||||||||||||||||
| Debt converted to equity | – | – | ||||||||||||||||||||||
| Shares Issued for Services | – | – | – | |||||||||||||||||||||
| Series A Preferred Stock Offering | – | – | – | – | – | – | ||||||||||||||||||
| Stock based compensation | – | – | – | – | – | |||||||||||||||||||
| Other comprehensive income | – | – | – | – | – | – | ||||||||||||||||||
| Net loss | – | – | – | – | – | – | ||||||||||||||||||
| BALANCE AT JUNE 30, 2025 | $ | $ | $ | $ | ||||||||||||||||||||
| 5 |
COEPTIS THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (continued)
For the Three and Six Months Ended June 30, 2025 and 2024
(Unaudited)
| TOTAL | NON- | |||||||||||||||||||
| SUBSCRIPTION | ACCUMULATED | CONTROLLING | CONTROLLING | TOTAL | ||||||||||||||||
| RECEIVABLE | DEFICIT | INTEREST | INTEREST | EQUITY | ||||||||||||||||
| BALANCE AT DECEMBER 31, 2023 | $ | ( | ) | $ | ( | ) | $ | $ | $ | |||||||||||
| Shares issued for non-employee services | – | – | – | |||||||||||||||||
| Warrants issued for cash | – | – | – | |||||||||||||||||
| Warrants issued for services | – | – | – | |||||||||||||||||
| Warrants issued in exchange for note receivable | ( | ) | – | ( | ) | – | ( | ) | ||||||||||||
| Stock based compensation | – | – | – | |||||||||||||||||
| Stock split adjustment | – | – | – | |||||||||||||||||
| Net loss | – | ( | ) | ( | ) | – | ( | ) | ||||||||||||
| BALANCE AT MARCH 31, 2024 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | |||||||
| Shares issued for services | – | – | – | |||||||||||||||||
| Shares issued for the conversion of debt | – | – | – | |||||||||||||||||
| Preferred share offering | ( | ) | – | |||||||||||||||||
| Stock based compensation | – | – | – | |||||||||||||||||
| Stock split adjustment | – | – | – | |||||||||||||||||
| Net loss | – | ( | ) | ( | ) | – | ( | ) | ||||||||||||
| BALANCE AT JUNE 30, 2024 | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | |||||||
| BALANCE AT DECEMBER 31, 2024 | $ | ( | ) | $ | ( | ) | $ | $ | $ | |||||||||||
| Series A Preferred Stock Offering | – | |||||||||||||||||||
| Pre-funded warrants exercise | – | – | – | |||||||||||||||||
| Preferred share conversion | – | – | – | – | – | |||||||||||||||
| Shares Issued for Services | – | – | – | |||||||||||||||||
| Shares Issued for SEPA | – | – | – | |||||||||||||||||
| Asset Purchase Agreement | – | – | – | – | – | |||||||||||||||
| Stock based compensation | – | – | – | |||||||||||||||||
| Warrants issued for services | – | – | – | |||||||||||||||||
| Net loss | – | ( | ) | ( | ) | – | ( | ) | ||||||||||||
| BALANCE AT MARCH 31, 2025 | ( | ) | ( | ) | ||||||||||||||||
| Pre-funded warrants exercise | – | – | – | |||||||||||||||||
| Preferred share conversion | – | – | – | – | – | |||||||||||||||
| Debt converted to equity | – | – | – | |||||||||||||||||
| Shares Issued for Services | – | – | – | |||||||||||||||||
| Series A Preferred Stock Offering | – | – | ||||||||||||||||||
| Stock based compensation | – | – | – | |||||||||||||||||
| Net loss | – | ( | ) | ( | ) | – | ( | ) | ||||||||||||
| BALANCE AT JUNE 30, 2025 | $ | ( | ) | $ | ( | ) | $ | $ | $ | |||||||||||
The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.
| 6 |
COEPTIS THERAPEUTICS HOLDINGS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Six Months Ended | ||||||||
| June 30, 2025 | June 30, 2024 | |||||||
| OPERATING ACTIVITIES | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation and amortization | ||||||||
| Forgiveness of interest | ||||||||
| Right of use asset amortization | ||||||||
| Amortization of debt discount | ||||||||
| Change in fair value of derivative liability warrants | ||||||||
| Stock based compensation | ||||||||
| Shares issued for non-employee services | ||||||||
| Warrants issued for services | ||||||||
| Change in fair value of derivative liability | ( | ) | ||||||
| Change in fair value of derivative liability warrants | ||||||||
| Loss on shares issued for conversion of debt | ||||||||
| Debt converted to equity | ||||||||
| Unrealized gain on marketable securities | ( | ) | ||||||
| (Increase) decrease in: | ||||||||
| Accounts receivable | ( | ) | ||||||
| Interest receivable | ( | ) | ||||||
| Prepaid assets | ( | ) | ||||||
| Right of use asset/liability | ( | ) | ( | ) | ||||
| Increase (decrease) in: | ||||||||
| Accounts payable | ( | ) | ( | ) | ||||
| Accrued expenses | ( | ) | ||||||
| Customer deposit | ( | ) | ||||||
| NET CASH USED IN OPERATING ACTIVITIES | ( | ) | ( | ) | ||||
| INVESTING ACTIVITIES | ||||||||
| Increase in subscription receivable in exchange for cash | ( | ) | ||||||
| NET CASH USED IN INVESTING ACTIVITIES | ( | ) | ||||||
| FINANCING ACTIVITIES | ||||||||
| Proceeds from notes payable | ||||||||
| Repayment of notes payable | ( | ) | ( | ) | ||||
| Warrants issued for cash | ||||||||
| Cash received for stock subscription | ||||||||
| Preferred stock offering | ||||||||
| NET CASH PROVIDED BY FINANCING ACTIVITIES | ||||||||
| NET INCREASE (DECREASE) IN CASH | ||||||||
| CASH AT BEGINNING OF PERIOD | ||||||||
| CASH AT END OF PERIOD | $ | $ | ||||||
| SUPPLEMENTAL CASH FLOW DISCLOSURES | ||||||||
| Interest paid | $ | $ | ||||||
| Taxes paid | $ | $ | ||||||
| SUPPLEMENTAL NON-CASH DISCLOSURES | ||||||||
| Shares issued for the conversion of debt | $ | $ | ||||||
| Subscriptions receivable | $ | $ | ||||||
The accompanying notes are an integral part of the condensed consolidated unaudited financial statements.
| 7 |
COEPTIS THERAPEUTICS HOLDINGS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the Three and Six Months Ended June 30, 2025 and 2024 (unaudited)
NOTE 1 – DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
Nature of Business
General. Coeptis Therapeutics Holdings, Inc. (“Coeptis”, the “Company” or “we” or “our”) was originally incorporated in the British Virgin Islands on November 27, 2018, under the name Bull Horn Holdings Corp. On October 27, 2022, Bull Horn Holdings Corp. domesticated from the British Virgin Islands to the State of Delaware. On October 28, 2022, in connection with the closing of the Merger, we changed our corporate name from Bull Horn Holdings Corp. to “Coeptis Therapeutics Holdings, Inc.”
The Merger Transaction. On October 28, 2022, a wholly owned subsidiary of Bull Horn Holdings Corp., merged with and into Coeptis Therapeutics, Inc., with Coeptis Therapeutics, Inc. as the surviving corporation of the Merger. As a result of the Merger, we acquired the business of Coeptis Therapeutics, Inc., which we now continue to operate as our wholly owned subsidiary.
About the Company’s Subsidiaries. We are now a holding company that currently operates through our direct and indirect subsidiaries SNAP Biosciences, Inc. and GEAR Therapeutics, Inc., which are majority owned, and Coeptis Therapeutics, Inc., Coeptis Pharmaceuticals, Inc. and Coeptis Pharmaceuticals, LLC, which are wholly owned.
Coeptis is a biopharmaceutical and technology company. The biopharmaceutical division focuses on developing innovative cell therapy platforms for cancer, autoimmune, and infectious diseases. Coeptis aims to advance treatment paradigms and improve patient outcomes through its cutting-edge research and development efforts. The technology division focuses on enhancing operational capabilities through advanced technologies. This division features AI-powered marketing software and robotic process automation tools designed to optimize business processes and improve overall efficiency.
Basis of Presentation – The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, which are necessary to present fairly the Company’s financial position, results of operations, and cash flows. The interim results of operations are not necessarily indicative of the results that may occur for the full fiscal year. Certain information and footnote disclosure normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to instructions, rules, and regulations prescribed by the United States Securities and Exchange Commission (“SEC”). The condensed interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2024 that was filed with the SEC on March 28, 2025.
Principles of Consolidation – The accompanying condensed consolidated financial statements include the accounts of Coeptis Therapeutics, Inc., Coeptis Pharmaceuticals, Inc., Coeptis Pharmaceuticals, LLC, SNAP Biosciences, Inc., and GEAR Therapeutics, Inc. All material intercompany accounts, balances and transactions have been eliminated.
Reverse Stock Split – On December
31, 2024, the Company completed a
| 8 |
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Use of Estimates – The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Employee and Non-Employee Share-Based Compensation – The Company applies Accounting Standards Codification (“ASC”) 718-10, Share-Based Payment, which requires the measurement and recognition of compensation expenses for all share-based payment awards made to employees and directors including employee stock option equity awards issued to employees and non-employees based on estimated fair values.
ASC 718-10 requires companies to estimate the fair value of equity-based option awards on the date of grant using an option-pricing model. The fair value of the award is recognized as an expense on a straight-line basis over the requisite service periods in the Company’s unaudited condensed consolidated statements of operations. The Company recognizes share-based award forfeitures as they occur.
The Company estimates the fair value of granted option equity awards using a Black-Scholes option pricing model. The option-pricing model requires a number of assumptions, of which the most significant are share price, expected volatility and the expected option term (the time from the grant date until the options are exercised or expire). Expected volatility is estimated based on volatility of the Company. The Company has historically not paid dividends and has no foreseeable plans to issue dividends. The risk-free interest rate is based on the yield from governmental zero-coupon bonds with an equivalent term. The expected option term is calculated for options granted to employees and directors using the “simplified” method. Changes in the determination of each of the inputs can affect the fair value of the options granted and the results of operations of the Company.
Recent Accounting Pronouncements – During the six months ended June 30, 2025, there were new accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”). Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s condensed consolidated financial statements.
Revenue Recognition – The Company recognizes revenue in accordance with ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”) to depict the transfer of control to the Company’s customers in an amount reflecting the consideration to which the Company expects to be entitled. The Company determines revenue recognition through the following steps:
| i. | Identification of the contract, or contracts, with a customer | |
| ii. | Identification of the performance obligations in the contract | |
| iii. | Determination of the transaction price | |
| iv. | Allocation of the transaction price to the performance obligations in the contract | |
| v. | Recognition of revenue, when, or as, the company satisfies the performance obligations. |
Under ASC 606, revenue is recognized when control of promised goods and services is transferred to customers. A performance obligation is a contractual promise to transfer a distinct good or service to the customer and is the unit of account under ASC 606. The transaction price of a contract is allocated to distinct performance obligations and recognized as revenue when or as the performance obligations are satisfied.
The Company generates revenue from its customers by 1) performing data research for its customers and delivering advertising campaigns via cold emails and social media sites, and 2) providing webinars for its customers to a targeted business-to-business audience. The fee for these services is based on observable prices explicitly negotiated between the Company and the customer. The Company recognizes revenue at the point in time when the good or service is delivered to the customer, which occurs upon delivery of the advertising campaign or webinar and there is a transfer of control to the customer.
| 9 |
During the three and six months ended June
30, 2025, revenues from delivering advertising campaigns via cold emails and social media sites were recognized from three customers
who accounted for
During the three and six months ended June 30,
2025, revenues from delivering webinar services were recognized from two customers who accounted for
Accounts Receivable – Accounts
receivable represent amounts due from customers for goods sold or services rendered in the ordinary course of business and are recorded
at the invoiced amount. Accounts receivable totaled $
Investments and Marketable Securities – The Company classifies its investments and marketable securities in accordance with ASC 320, Investments – Debt and Equity Securities, and ASC 321, Investments – Equity Securities, as applicable. Investments in equity securities with readily determinable fair values are measured at fair value, with unrealized gains and losses recognized in net income. For equity securities without readily determinable fair values, the Company applies the measurement alternative, recording these investments at cost, adjusted for impairments or observable price changes from transactions involving similar securities.
Marketable securities are categorized as trading securities and are thus marked to market and stated at fair value. Fair value is determined using the quoted closing bid prices and is recorded as a Level 1 asset. Realized gains and losses on marketable securities are recognized as incurred in the condensed consolidated statements of operations and comprehensive income. Net changes in unrealized gains and losses are reported in the condensed consolidated statements of operations and comprehensive income in the current period.
Going Concern – The accompanying
unaudited condensed consolidated financial statements have been prepared in conformity with GAAP, which contemplates continuation of the
Company as a going concern, which is dependent upon the Company’s ability to obtain sufficient financials or establish itself as
a profitable business. As of June 30, 2025, the Company had an accumulated deficit of $
NOTE 3 – CO-DEVELOPMENT RIGHTS
In December 2018, the Company entered into
an agreement with Purple Biotech (“Purple”) to market, distribute, and sell the Consensi product (the
“Product”) on an exclusive basis within the United States and Puerto Rico. In September of 2021, the Company executed a
license termination agreement with Purple to cease all efforts for sales and promotion of the Product in the United States and
Puerto Rico. The termination included (i) issuance of $1,500,000 of convertible debt due in February 2023 to satisfy amounts owed
for the license, (ii) the issuance of warrants (See Note 8, Capital Structure) and (iii) transfer of inventory ownership back to
Purple. In conjunction with this termination, the Company also terminated its marketing agreement with a third party for the
Product’s sales and promotion. On July 14, 2023, the Company and Purple executed an amendment to revise the note’s
payment schedule, extending the maturity date to March 31, 2024. On June 19, 2024, the Company and Purple executed another amendment
to extend the maturity date to August 31, 2024. The outstanding principal balance due under the convertible note at December 31,
2024 was $
| 10 |
During the year ended December 31, 2021, the
Company and Vy-Gen-Bio, Inc. (“Vy-Gen”) entered into agreements to jointly develop and commercialize two Vy-Gen product candidates,
CD38-GEAR-NK and CD38-Diagnostic (the “CD38 Assets”). The Company paid $
The Company made certain judgements as the basis in determining the accounting treatment of these options. The CD38 Assets represent a platform technology and a diagnostic tool which have multiple applications and uses. Both projects are intended to be used in more than one therapy or diagnostic option. For example, GEAR-NK is a technology which allows for the gene editing of human natural killer cells, so that these cells can no longer bind and be destroyed by targeted monoclonal antibody treatments. The GEAR-NK technology can be modified to work concomitantly with many different monoclonal antibody treatments in which there are currently over 100 approved by the FDA. Anti- CD38 is only the first class of monoclonal antibody treatments being developed under the GEAR-NK platform. Therefore, the pursuit of FDA approval for the use of CD38 assets for at least one indication or medical device approval is at least reasonably expected. Further, as the diagnostic asset may be used as an in vitro technology, it could be classified as a medical device, and therefore toxicity studies would not be a contingency to be resolved before reasonably establishing future value assumptions. In addition, there is perceived value in the CD38 assets, based on publicly disclosed current business deals in cell therapies, the developing market for these innovative technologies, and current interest from third parties in these technologies. The Company may sell or license its right to another party, with the written consent of Vy-Gen, which cannot be unreasonably withheld. Furthermore, the Company believes that any negative results from ongoing development of a single therapy or use, would not result in abandoning the project. Given these considerations, The Company has determined that these options have alternative future use and should be recorded as assets pursuant to ASC 730-10-25-2, Research and Development.
Related to the joint development, the Company, under the direction of the joint steering committee, is assessing market opportunities, intellectual property protection, and potential regulatory strategies for the CD38 Assets. Vy-Gen is responsible for development activities conducted and overseen by the scientists at Karolinska Institute. The agreement does not currently require additional payments for research and development costs by the Company and no additional payments are required upon development or regulatory milestones.
In March 2025, the Company reached an agreement with Vy-Gen-Bio, Inc. (“Vy-Gen”) to successfully license the exclusive worldwide development and commercialization rights to the GEAR™ (Gene Edited Antibody Resistant) Cell Therapy Platform, representing a first-in-class approach to modifying potent cancer-targeting immune cells to optimize the likelihood of deep remission in patients with hematologic malignancies and other cancers. Coeptis had previously held limited co-development rights to GEAR. As part of this exclusive GEAR license agreement with VyGen-Bio, Inc., the Company committed to paying a $100,000 license fee by August 1, 2025, along with other performance-based license fees, milestone and royalty payments later in 2025 and beyond.
The total gross capitalized Co-Development
rights recorded was $
| 11 |
NOTE 4 – NOTES PAYABLE
In October 2022, as a result of the Merger,
the Company entered into a convertible promissory note agreement with an unrelated third party in the principal amount of $
NOTE 5 – CONVERTIBLE NOTES
In September 2021, as part of a termination
of a license agreement with Purple (see Note 3, Co-Development Options), the Company issued a convertible note in the principal
amount of $
Yorkville Convertible Notes
On January 3,
2024, the Company entered into an unsecured note agreement with an unrelated third party, YA II PN, LTD, a Cayman Islands exempt
limited partnership (“Yorkville”) in the principal amount of $
On November 1, 2024, the Company entered
into a Standby Equity Purchase Agreement (“SEPA”) pursuant to which the Company has the right to sell Yorkville up to
$20,000,000 of its shares of Company Common Stock, subject to certain limitations and conditions set forth in the SEPA, from time to
time during the term of the SEPA (such transaction, the “Yorkville Transaction”). In connection with the SEPA, Yorkville
has agreed to advance to the Company in the form of a convertible promissory note (the “Convertible Note”) an aggregate
principal amount of up to $
| 12 |
During the six months ended June 30, 2025,
Yorkville elected to convert the entire outstanding principal balance on YA Note-1, the convertible promissory note with an
outstanding principal balance of $
The Company shall make monthly payments beginning on the 7th trading day after either (i) the daily VWAP is less than the Floor Price then in effect for five trading days during a period of seven consecutive trading days (a “Floor Price Event”), or (ii) the Company has issued to Yorkville, pursuant to the transactions contemplated in the Convertible Note and the SEPA, in excess of 99% of the common shares available under the rules or regulations of Nasdaq Stock Market LLC (the “Exchange Cap”), where applicable (an “Exchange Cap Event”), (the last day of each such occurrence, an “Amortization Event Date”) and continuing on the same day of each successive Calendar Month until the entire outstanding principal amount shall have been repaid. Each monthly payment shall be in an amount equal to the sum of (i) $250,000 of principal in the aggregate among the Convertible Note and all other notes (or the outstanding Principal if less than such amount) (the “Amortization Principal Amount”), plus (ii) a payment premium equal to 5% in respect of such principal amount, provided that, the payment premium equal to 5% shall not apply in respect to any amount that is paid directly from an Advance from the SEPA, and (iii) accrued and unpaid interest hereunder as of each payment date. The obligation of the Company to make monthly prepayments related to an Amortization Event shall cease (with respect to any payment that has not yet come due) if at any time after the Amortization Event Date (A) in the event of a Floor Price Event, on the date that is the 7th consecutive Trading Day that the daily VWAP is greater than 110% of the Floor Price then in effect, or (B) in the event of an Exchange Cap event, the date the Company has obtained stockholder approval to increase the number of common shares under the Exchange Cap and the Exchange Cap no longer applies unless a subsequent Amortization Event occurs.
The SEPA is an equity-linked contract that
does not qualify for equity classification and is accounted for as a derivative liability recognized at fair value. Any changes in
fair value between the carrying amount of the forward issuance contracts and the settlement amounts will be recognized in other
income (expense) in the condensed consolidated statements of operations and comprehensive income. As of June 30, 2025 and December 31, 2024, the fair value
of the SEPA was $
The following table presents information about the Company’s derivative liability that is measured at fair value on a recurring basis at June 30, 2025 and December 31, 2024 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| Schedule of derivative liability | ||||||||||
| Description | Level | June 30, 2025 | December 31, 2024 | |||||||
| Derivative liability | 3 | $ | $ | |||||||
| Total | $ | $ | ||||||||
The derivative liability is accounted for as a liability in accordance with ASC 480 and is presented within derivative liability in the accompanying condensed consolidated balance sheets. The derivative liability is measured at fair value at inception and on a recurring basis, with changes in fair value presented in the condensed consolidated statements of operations and comprehensive income.
The derivative liability was valued using a binomial lattice model, which is considered to be a Level 3 fair value measurement. The binomial lattice model’s primary unobservable input utilized in determining the fair value of the derivative liability is the step factors input, assumed price movement, and probabilities assigned to them.
| 13 |
The following table provides quantitative information regarding Level 3 fair value measurements for the derivative liability:
| Schedule of assumptions used for valuation | ||||
December 31, 2024 | ||||
| Risk-free interest rate | ||||
| Expected volatility | ||||
| Conversion price | $ | |||
| Stock price | $ | |||
The following table presents the changes in the fair value of derivative liability:
| Schedule of changes in fair value of derivative liability | ||||
Warrant Liabilities | ||||
| Fair value as of November 1, 2024 (inception) | $ | |||
| Change in fair value | ||||
| Fair value as of December 31, 2024 | ||||
| Change in fair value | ( | ) | ||
| Extinguishment of fair value of liability | ( | ) | ||
| Fair value as of June 30, 2025 | $ | |||
There were
On January 16, 2025, the Company entered into
a convertible promissory note with YA II PN, LTD, a Cayman Islands exempt limited partnership (“Yorkville”), in the original
principal amount of $
If an Amortization Event occurs, then the Company shall make monthly payments beginning on the later of the 7th Trading Day after the Amortization Event Date, and any date that is six months from the Issuance Date, and continuing on the same day of each successive calendar month until the entire outstanding principal amount shall have been repaid. Each monthly payment shall be in an amount equal to the sum of (i) $250,000 of principal in the aggregate among this Note (or the outstanding principal if less than such amount) (the “Amortization Principal Amount”), plus (ii) a payment premium equal to 5% in respect of such Amortization Principal amount. The obligation of the Company to make monthly prepayments shall cease (with respect to any payment that has not yet come due) if any time after an Amortization Event (a) if the Amortization Event is due to the Floor Price, the daily VWAP is greater than the 110% of the Floor Price for a period of seven consecutive trading days, and (b) if the Amortization Event is due to the Exchange Cap, the date the Company has obtained stockholder approval to increase the number of Common Shares under the Exchange Cap and/ or the Exchange Cap no longer applies, in either case unless a subsequent Amortization Event occurs.
Additionally, the Company, at its option, shall have the right, but not the obligation, to redeem early a portion or all amounts outstanding under the note at a redemption amount equal to the outstanding principal balance being repaid or redeemed, plus a 5% prepayment premium, plus all accrued and unpaid interest; provided that (i) the Company provides Yorkville with no less than ten trading days’ prior written notice thereof and (ii) on the date such notice is issued, the VWAP of the Common Stock is less than the Fixed Price.
| 14 |
An “Amortization Event” will occur under the terms of the Promissory Note if (i) the daily VWAP is less than the Floor Price for five trading days during a period of seven consecutive trading days, or (ii) the Company has issued has issued to Yorkville, pursuant to the transactions contemplated in the note and any integrated transactions, in excess of 99% of the Common Shares available under the Exchange Cap.
NOTE 6 – SBA LOAN PAYABLE
Loans under the CARES Act -- On
July 8, 2020, the Company received a loan of $
NOTE 7 – DERIVATIVE LIABILITY WARRANTS
At June 30, 2025 and December 31, 2024, there
were (i)
The Company may call the Public Warrants for redemption, in whole and not in part, at a price of $0.01 per warrant:
| · | at any time while the Public Warrants are exercisable, | |
| · | upon not less than 30 days’ prior written notice of redemption to each Public Warrant holder, | |
| · | if, and only if, the reported last sale price of the ordinary shares equals or exceeds $16.50 per share, for any 20 trading days within a 30-trading day period ending on the third trading day prior to the notice of redemption to Public Warrant holders, and | |
| · | if, and only if, there is a current registration statement in effect with respect to the ordinary shares underlying such warrants at the time of redemption and for the entire 30-day trading period referred to above and continuing each day thereafter until the date of redemption. |
If the Company calls the Public Warrants for redemption, management will have the option to require all holders that wish to exercise the Public Warrants to do so on a “cashless basis,” as described in the warrant agreement. The exercise price and number of ordinary shares issuable upon exercise of the warrants may be adjusted in certain circumstances including in the event of a share dividend, extraordinary dividend or recapitalization, reorganization, merger or consolidation. However, except as described above, the warrants will not be adjusted for issuances of ordinary shares at a price below its exercise price. Additionally, in no event will the Company be required to net cash settle the warrants. If the Company is unable to complete a Business Combination within the Combination Period and the Company liquidates the funds held in the Trust Account, holders of warrants will not receive any of such funds with respect to their warrants, nor will they receive any distribution from the Company’s assets held outside of the Trust Account with respect to such warrants. Accordingly, the warrants may expire worthless.
| 15 |
The Private Placement Warrants are identical to the Public Warrants, except that the Private Placement Warrants only allow the holder thereof to one ordinary share. Additionally, the Private Placement Warrants will be exercisable on a cashless basis and be non-redeemable so long as they are held by the initial purchasers or their permitted transferees. If the Private Placement Warrants are held by someone other than the initial purchasers or their permitted transferees, the Private Placement Warrants will be redeemable by the Company and exercisable by such holders on the same basis as the Public Warrants.
Within ASC 815, Derivative and Hedging, Section 815-40-15 addresses equity versus liability treatment and classification of equity-linked financial instruments, including warrants, and states that a warrant may be classified as a component of equity only if, among other things, the warrant is indexed to the issuer’s ordinary share. Under ASC Section 815-40-15, a warrant is not indexed to the issuer’s ordinary share if the terms of the warrant require an adjustment to the exercise price upon a specified event and that event is not an input to the fair value of the warrant. Based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that the Company’s Private Placement Warrants and Public Warrants are not indexed to the Company’s ordinary share in the manner contemplated by ASC Section 815-40-15 because the holder of the instrument is not an input into the pricing of a fixed-for-fixed option on equity shares. In addition, based on management’s evaluation, the Company’s audit committee, in consultation with management, concluded that certain warrant provisions preclude equity treatment as by ASC Section 815-10-15.
The Company accounts for its Public Warrants and Private Placement Warrants as liabilities as set forth in ASC 815-40-15-7D and 7F. See below for details about the methodology and valuation of the Warrants.
The following table presents information about the Company’s derivative liability warrant that are measured at fair value on a recurring basis at June 30, 2025 and December 31, 2024, and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value:
| Schedule of fair value hierarchy | ||||||||||
| Description | Level | June 30, 2025 | December 31, 2024 | |||||||
| Warrant Liability – Public Warrants | 1 | $ | $ | |||||||
| Warrant Liability – Private Placement Warrants | 3 | |||||||||
| Total | $ | $ | ||||||||
The Warrants are accounted for as liabilities in accordance with ASC 815-40 and are presented within derivative liability warrants in the accompanying condensed consolidated balance sheets. The derivative liability warrants are measured at fair value at inception and on a recurring basis, with changes in fair value presented in the condensed consolidated statements of operations and comprehensive income.
The Warrants were valued using a binomial lattice model, which is considered to be a Level 3 fair value measurement. The binomial lattice model’s primary unobservable input utilized in determining the fair value of the Warrants is the expected volatility of the ordinary shares. The expected volatility as of the Initial Public Offering date was derived from observable public warrant pricing on comparable ‘blank-check’ companies without an identified target. For periods subsequent to the detachment of the Public Warrants from the Units, the close price of the Public Warrant price will be used as the fair value as of each relevant date.
The following table provides quantitative information regarding Level 3 fair value measurements:
| Schedule of fair value assumptions | ||||||||
June 30, 2025 | December 31, 2024 | |||||||
| Risk-free interest rate | ||||||||
| Expected volatility | ||||||||
| Exercise price | $ | $ | ||||||
| Stock price | $ | $ | ||||||
| 16 |
The following table presents the changes in the fair value of warrant liabilities:
| Schedule of changes in fair value of warrant liabilities | ||||||||||||
Private Placement | Public | Warrant Liabilities | ||||||||||
| Fair value as of December 31, 2024 | $ | $ | $ | |||||||||
| Change in valuation inputs | ( | ) | ( | ) | ( | ) | ||||||
| Fair value as of March 31, 2025 | ||||||||||||
| Change in valuation inputs | ||||||||||||
| Fair value as of June 30, 2025 | $ | $ | $ | |||||||||
There were no transfers in or out of Level 3 from other levels in the fair value hierarchy during the quarter ended June 30, 2025 and year ended December 31, 2024.
NOTE 8 – CAPITAL STRUCTURE
The total number of shares of stock which the
corporation shall have authority to issue is 160,000,000 shares, of which
Common Stock - As of June 30, 2025,
the Company had
During the six months ended June 30, 2025 and the year ended December 31, 2024, there were no capital distributions.
On June 16, 2023, the Company completed a public
offering issuing
| 17 |
On December 28, 2023, the Company granted pre-funded
warrants exercisable to acquire up to 60,000 shares of our common stock for net proceeds of $1,200,000. The pre-funded common stock purchase
warrants can be exercised at a price of $0.0001 per share, with no expiration date. During the first quarter of 2024, the Company and
the third-party borrower agreed to amend the note as a result of the decline in the publicly traded common stock price. The amount of
pre-funded warrants exercisable to acquire up to 60,000 shares of common stock was amended to 100,000 shares of common stock, and the
total principal balance of the note agreement was increased from $1,000,000 to $1,100,000. The aggregate exercise price of this Warrant
was partially pre-funded in connection with $100,000 and a $
On February 8, 2024, the Company granted pre-funded warrants exercisable to acquire up to 200,000 shares of our common stock for net proceeds of $2,400,000. The pre-funded common stock purchase warrants can be exercised at a price of $0.0001 per share, with no expiration date. The aggregate exercise price of this Warrant was partially pre-funded in connection with $500,000 and a $1,900,000 subscription receivable at a 6% per annum interest rate due on December 31, 2024. On August 12, 2024, the third-party assigned shares of common stock in a privately held company for the equivalent amount of principal and accrued interest owed, which satisfied the subscription receivable in full. See Note 10, Investments, for additional information.
Treasury Stock – There was
Preferred Stock – The
Company has
On June 13, 2024, the Company performed an
initial Series A preferred stock closing and raised $
On July 31, 2024, the Company performed a second
closing as part of its series A preferred stock offering and raised $
On September 4, 2024, the Company performed a
third closing as part of its series A preferred stock offering and raised $
On December 23, 2024, the Company performed a
fourth closing as part of its series A preferred stock offering and raised $
On February 6, 2025, the Company completed its
successful closure of the remaining $
Throughout the six months ended June 30, 2025,
| 18 |
The series A investors currently have an aggregate 15% non-voting equity ownership interest in the Company’s two newly formed subsidiaries, SNAP Biosciences Inc. and GEAR Therapeutics Inc.
The key terms of the Series A Preferred Stock are as follows:
Conversion. Each share of Series A Preferred Stock is convertible at the option of the holder, subject to the beneficial ownership and, if applicable, the primary market limitations described below, into such number of shares of the Company’s common stock as is equal to the number of shares of Series A Preferred Stock to be converted, multiplied by the stated value of $1,000 (the “Stated Value”), divided by the then conversion price. The initial conversion price is $0.40 per share of common stock, subject to adjustment in the event of stock splits, stock dividends, and similar transactions. In addition, the Series A Preferred Stock will automatically convert into shares of the Company’s common stock, subject to the beneficial ownership and, if applicable, the primary market limitations described below upon the consummation of a fundraising transaction in which the Company raises gross proceeds of at least $20 million.
Rank. The Series A Preferred Stock will be senior to the Company’s common stock and any other class of the Company’s capital stock that is not by its terms senior to or pari passu with the Series A Preferred Stock.
Dividends. The holders of Series A Preferred Stock will be entitled to dividends equal, on an as-if-converted to shares of the Company’s common stock basis (in each case after applying the beneficial ownership and, if applicable, the primary market limitations described below), to and in the same form as dividends actually paid on shares of the Company’s common stock when, as, and if such dividends are declared on shares of the Company’s common stock.
Liquidation. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company, the holders of shares of Series A Preferred Stock then outstanding will be entitled to be paid out of the assets of the Company available for distribution to its stockholders, before any payment shall be made to the holders of the Company’s common stock by reason of their ownership thereof, an amount per share equal to the greater of (i) the Stated Value, plus any dividends accrued but unpaid thereon, or (ii) such amount per share as would have been payable had all shares of Series A Preferred Stock been converted (in each case after applying the beneficial ownership and, if applicable, the primary market limitations described below) into the Company’s common stock immediately prior to such event.
Voting. On any matter to be acted upon or considered by the stockholders of the Company, each holder of Series A Preferred Stock shall be entitled to vote on an “as converted” basis (after applying the beneficial ownership and primary market limitations described below).
Beneficial Ownership Limitation. The Company will not affect any conversion of the Series A Preferred Stock, and a holder will not have the right to receive dividends or convert any portion of its Series A Preferred Stock, to the extent that prior to the conversion such holder (together with such holder’s affiliates, and any persons acting as a group together with such holder or any of the holder’s affiliates) beneficially owns less than 20% of the Company’s outstanding common stock and, after giving effect to the receipt of dividends or the conversion, the holder (together with such holder’s affiliates, and any persons acting as a group together with such holder or any of the holder’s affiliates) would beneficially own 20% or more of the Company’s outstanding common stock.
Exchange Limitation. Unless the approval of the Company’s stockholders is not required by the applicable rules of Nasdaq for issuances of the Company’s common stock in excess of 19.99% of the outstanding common stock as of June 14, 2024 (the “Market Limit”), or unless the Company has obtained such approval, the Company shall not affect any conversion of the Series A Preferred Stock, including, without limitation, any automatic conversion, and a holder shall not have the right to receive dividends on or convert any portion of the Series A Preferred Stock, to the extent that, after giving effect to the receipt of the Company’s common stock in connection with such dividends or conversion, the holder would have received in excess of its pro rata share of the Market Limit.
| 19 |
Stock Based Compensation –
Stock Based Compensation
A summary of the Company’s stock option activity is as follows:
| Schedule of stock option activity | ||||||||||||||||
| Shares Underlying Options | Weighted Average Exercise Price | Weighted Average Contractual Life (Years) | Intrinsic Value | |||||||||||||
| Outstanding at December 31, 2024 | $ | $ | – | |||||||||||||
| Granted | $ | – | ||||||||||||||
| Forfeited/Expired | ( | ) | – | $ | – | |||||||||||
| Exercised | – | $ | – | |||||||||||||
| Outstanding at June 30, 2025 | $ | $ | ||||||||||||||
For the three months ended June 30, 2025 and 2024,
the Company recorded $
The options granted during the six months ended June 30, 2025 and 2024 were valued using the Black-Scholes option pricing model using the following weighted average assumptions:
| Schedule of weighted average assumptions | ||||||||
| For the six months ended June 30, | ||||||||
| 2025 | 2024 | |||||||
| Expected term, in years | ||||||||
| Expected volatility | ||||||||
| Risk-free interest rate | ||||||||
| Dividend yield | ||||||||
Options/Stock Awards Forfeited – On
March 24, 2025, Colleen Delaney, Chief Scientific and Medical Officer, resigned her position for a reason other than cause. Per the Plan,
her unvested stock options (
Options/Stock Awards – On
March 4, 2025, the Company granted options to purchase an aggregate of
| 20 |
Common Stock Warrants –
All common stock warrants outstanding, are listed in the table below:
| Schedule of warrants outstanding | ||||||||||||||||
| Outstanding at | ||||||||||||||||
| Reference | Date Issued | Exercise price | Expiration | June 30, 2025 | December 31, 2024 | |||||||||||
| Warrant Holder 1 | $ | |||||||||||||||
| Warrant Holder 1 | $ | |||||||||||||||
| Warrant Holder 1 | $ | |||||||||||||||
| Warrant Holder 2 | $ | |||||||||||||||
| Warrant Holder 2 | $ | |||||||||||||||
| Warrant Holder 5 | $ | |||||||||||||||
| Warrant Holder 18 | $ | |||||||||||||||
| Warrant Holder 20 | $ | |||||||||||||||
| Warrant Holder 21 | $ | |||||||||||||||
| Series A & B Warrants | $ | |||||||||||||||
| Series A Warrants | $ | |||||||||||||||
| Series B Warrants | $ | |||||||||||||||
| Warrant Holder 22 | $ | |||||||||||||||
| Warrant Holder 22 | $ | |||||||||||||||
| Warrant Holder 23 | $ | |||||||||||||||
| Warrant Holder 23 | $ | |||||||||||||||
| Warrant Holder 24 | $ | |||||||||||||||
| Pre-Funded Warrants 2 | $ | –* | ||||||||||||||
| Pre-Funded Warrants 3 | $ | –* | ||||||||||||||
| Warrant Holder 25 | $ | |||||||||||||||
| Total Warrants outstanding | ||||||||||||||||
| * | Pre-funded warrants, do not expire. |
Subscription
receivable – In September 2023, the Company agreed to issue
In September 2023, the Company agreed to
issue
| 21 |
In December 2023, the Company agreed to grant
pre-funded warrants exercisable to acquire up to 60,000 shares of common stock to the borrower for a principal sum amount of $1,000,000.
During the first quarter of 2024, the Company and the third-party borrower agreed to amend the note as a result of the decline in the
publicly traded common stock price. The amount of pre-funded warrants exercisable to acquire up to 60,000 shares of common stock was amended
to
In February 2024, the Company agreed to grant
pre-funded warrants exercisable to acquire up to
In June 2024, in connection with the Company’s series A preferred stock offering, the Company closed on subscription agreements totaling $2,100,000, which the Company collected in full in February 2025.
During the second quarter of 2025, the
Company collected $
Standby Equity Purchase Agreement – On November 1, 2024, the Company entered into the Standby Equity Purchase Agreement (“SEPA”) with Yorkville pursuant to which the Company has the right to sell to Yorkville up to $20,000,000 of common stock, subject to certain limitations and conditions set forth in the SEPA, from time to time during the term of the SEPA. The Company also entered into a Registration Rights Agreement with Yorkville pursuant to which it will register the resale of shares of common stock issued to Yorkville pursuant to the SEPA. Sales of common stock to Yorkville under the SEPA, and the timing of any such sales, are at the Company’s option, and the Company is under no obligation to sell common stock to Yorkville under the SEPA, except in connection with notices that may be submitted by Yorkville in certain circumstances as described below.
Each advance (each, an “Advance”) the Company requests in writing to Yorkville under the SEPA (notice of such request, an “Advance Notice”) may be for a number of shares of common stock up to such amount as is equal to 100% of the average daily volume traded of the common stock during the five trading days immediately prior to the date the Company requests each Advance. The shares of common stock purchased pursuant to an Advance delivered by the Company will be purchased at a price equal to 95% of the lowest daily VWAP of the shares of common stock during the three consecutive trading days commencing on the date of the delivery of the Advance Notice, other than the daily VWAP on a day in which the daily VWAP is less than a minimum acceptable price as stated by the Company in the Advance Notice or there is no VWAP on the subject trading day. The Company may establish a minimum acceptable price in each Advance Notice below which the Company will not be obligated to make any sales to Yorkville. “VWAP” is defined as the daily volume weighted average price of the shares of Common Stock for such trading day on the Nasdaq Stock Market (“Nasdaq”) during regular trading hours as reported by Bloomberg L.P.
The SEPA will automatically terminate on the earliest to occur of (i) December 1, 2027, provided that the Convertible Note (defined in Note 5) has been fully repaid or (ii) the date on which the Company shall have made full payment of Advances pursuant to the SEPA. The Company has the right to terminate the SEPA at no cost or penalty upon five trading days’ prior written notice to Yorkville, provided that there are no outstanding Advance Notices for which shares of common stock need to be issued and the Company has paid all amounts owed to Yorkville pursuant to the Convertible Note. The Company and Yorkville may also agree to terminate the SEPA by mutual written consent.
| 22 |
Any purchase under an Advance would be subject to certain limitations, including that Yorkville shall not purchase or acquire any shares that would result in it and its affiliates beneficially owning more than 4.99% of the then outstanding voting power or number of shares of common stock or any shares that, aggregated with shares issued under all other earlier Advances, would exceed 19.99% of all shares of common stock outstanding on the date of the SEPA (the “Exchange Cap”), unless the Company obtains stockholder approval to issue shares of common stock in excess of the Exchange Cap in accordance with applicable Nasdaq rules.
In connection with the execution of the SEPA,
the Company agreed to pay a commitment fee of $
Additionally, Yorkville agreed to advance to the
Company, in exchange for the Convertible Note, an aggregate principal amount of $
Additionally, the Company, at its option, shall have the right, but not the obligation, to redeem early a portion or all amounts outstanding under the Convertible Note at a redemption amount equal to the outstanding principal balance being repaid or redeemed, plus a 5% prepayment premium, plus all accrued and unpaid interest; provided that (i) the Company provides Yorkville with no less than ten trading days’ prior written notice thereof and (ii) on the date such notice is issued, the VWAP of the common stock is less than the Fixed Price.
NOTE 9 – NON-CONTROLLING INTEREST
As a result of the series A preferred stock offering
discussed in Note 8, Capital Structure, the Company has consolidated the two newly formed subsidiaries, SNAP Biosciences, Inc. and GEAR
Therapeutics, Inc., because we have a controlling interest in both. Therefore, the entities’ financial statements are consolidated
in our condensed consolidated financial statements and the entities’ equity is recorded as a non-controlling interest. As part of
the initial closings, the Series A Investors received in the aggregate a 15% non-voting equity ownership in both of the newly formed subsidiaries.
The Company contributed the co-development options to GEAR Therapeutics, Inc. and recorded $
NOTE 10 – INVESTMENTS
In August 2024, the Company satisfied $
| 23 |
During the six months ended June 30, 2025, the
Company entered into a one-year agreement with a customer to provide access to the NexGenAI Affiliates Network platform. The contract
fee paid by the customer consisted of
NOTE 11 – COMMITMENTS AND CONTINGENCIES
Leases – The Company leases
office space under an operating lease that commenced December 1, 2017 and was extended through multiple lease extensions. The third lease
extension extended the lease for twenty-four months, beginning on June 1, 2022 and ended on May 31, 2024. The fourth lease extension,
signed on January 30, 2024, extended the lease for twenty-four months, beginning June 1, 2024 and ending on May 31, 2026. The monthly
rent is $
The Company records rent expense associated
with this lease on the straight-line basis in conjunction with the terms of the underlying lease. During the three and six months
ended June 30, 2025, rents paid totaled $
Right of use asset is summarized below:
| Schedule of lease information | ||||||||
| June 30, 2025 | December 31, 2024 | |||||||
| Office lease | $ | $ | ||||||
| Less: accumulated depreciation | ( | ) | ( | ) | ||||
| Right of use asset, net | $ | $ | ||||||
Operating lease liability is summarized below:
| June 30, 2025 | December 31, 2024 | |||||||
| Office lease | $ | $ | ||||||
| Less: current portion | ( | ) | ( | ) | ||||
| Long term portion | $ | $ | ||||||
Future minimum rental payments required under the lease are as follows:
| Schedule of future minimum rental payments | ||||
| 2025 | $ | |||
| 2026 | ||||
| Total minimum lease payments: | ||||
| Less amount representing interest | ( | ) | ||
| Present value of minimum lease payments: | $ |
Legal Matters – The Company is currently not a defendant in any litigation or threatened litigation that could have a material effect on the Company’s condensed consolidated financial statements.
| 24 |
CAR T License – On August 31,
2022, the Company entered into an exclusive license agreement with the University of Pittsburgh for certain intellectual property rights
related to the universal self-labeling SynNotch and CARs for programable antigen-targeting technology platform. The Company paid the University
of Pittsburgh a non-refundable fee in the amount of $75,000 for the exclusive patent rights to the licensed technology. Under the terms
of the agreement, the Company has been assigned the worldwide development and commercialization rights to the licensed technology in the
field of human treatment of cancer with antibody or antibody fragments using SNAP-CAR T-cell technology, along with (i) an intellectual
property portfolio consisting of issued and pending patents and (ii) options regarding future add-on technologies and developments. In
consideration of these rights, the Company paid an initial license fee of $
In September 2023, the Company expanded its exclusive
license agreement with the University of Pittsburgh to include the SNAP-CAR technology platform in natural killer (NK) cells. The Company
agreed to pay $
Deverra Therapeutics, Inc. – On August 16, 2023, the Company entered into an exclusive licensing arrangement (the “License Agreement”) with Deverra Therapeutics Inc. (“Deverra”), pursuant to which the Company completed the exclusive license of key patent families and related intellectual property related to a proprietary allogeneic stem cell expansion and directed differentiation platform for the generation of multiple distinct immune effector cell types, including natural killer (NK) and monocyte/macrophages. The License Agreement provides the Company with exclusive rights to use the license patents and related intellectual property in connection with development and commercialization efforts in the defined field of use (the “Field”) of (a) use of unmodified NK cells as anti-viral therapeutic for viral infections, and/or as a therapeutic approach for treatment of relapsed/refractory AML and high-risk MDS; (b) use of Deverra’s cell therapy platform to generate NK cells for the purpose of engineering with Coeptis SNAP-CARs and/or Coeptis GEAR Technology; and (c) use of Deverra’s cell therapy platform to generate myeloid cells for the purpose of engineering with the Company’s current SNAP-CAR and GEAR technologies. In support of the exclusive license, the Company also entered into with Deverra (i) an asset purchase agreement (the “APA”) pursuant to which the Company purchased certain assets from Deverra, including but not limited to two Investigational New Drug (IND) applications and two Phase 1 clinical trial stage programs (NCT04901416, NCT04900454) investigating infusion of DVX201, an unmodified natural killer (NK) cell therapy generated from pooled donor CD34+ cells, in hematologic malignancies and viral infections and (ii) a non-exclusive sublicense agreement (the “Sublicense Agreement”), in support of the assets obtained by the exclusive license, pursuant to which the Company sublicensed from Deverra certain assets which Deverra has rights to pursuant a license agreement (“FHCRC Agreement”) by and between Deverra and The Fred Hutchinson Cancer Research Center (“FHCRC”).
In addition, in accordance with the terms of the Sublicense Agreement, the Company agreed to pay FHCRC certain specified contingent running royalty payments and milestone payments under the FHCRC Agreement, in each case to the extent such payments are triggered by the Company’s development activities.
Until December 2024, we operated under a Shared Services Agreement (“SSA”) with Deverra, which provided Coeptis and Deverra to share resources and collaborate on the development of Coeptis’ GEAR and SNAP-CAR platforms. The Company is continuing its development focus on both GEAR and SNAP-CAR, and will be considering prospective strategic partners for such development.
| 25 |
Registration Rights - Pursuant to a registration rights agreement entered into on October 29, 2020, the holders of the founder shares, the Private Placement Warrants and underlying securities, and any securities issued upon conversion of Working Capital Loans (and underlying securities) would be entitled to registration rights pursuant to a registration rights agreement. The holders of at least a majority in interest of the then-outstanding number of these securities were entitled to make up to three demands, excluding short form demands, that the Company register such securities. In addition, the holders have certain “piggy-back” registration rights with respect to registration statements filed subsequent to the consummation of a Business Combination. Notwithstanding the foregoing, Imperial, I-Bankers and Northland did not exercise their demand and “piggyback” registration rights after five (5) and seven (7) years after the effective date of the registration statement and did not exercise its demand rights on more than one occasion. The registration rights agreement did not contain liquidating damages or other cash settlement provisions resulting from delays in registering the Company’s securities. The Company would bear the expenses incurred in connection with the filing of any such registration statements.
Finder’s Fee and Indemnity Agreement –
The Company entered into a finder’s fee and indemnity agreement with a third party, pursuant to which the Company has agreed to
pay a fee in connection with the successful introduction and executive of the SEPA. Under the terms of the agreement, the Company was
obligated to pay a 4% fee upon the closing of the net funding amount of $1,350,000, equaling $54,000, and then 6% of the total cash consideration
received by the Company or the Company’s creditors in connection with any follow on financing, and 0.5% on the amount of any drawdown
made by the Company on the SEPA. The Company also agreed to indemnify and hold harmless the third party from and against any and all losses,
claims, damages, obligations, penalties, judgments, any and all legal and other actions caused by or related to the third party’s
engagement with the Company. As of June 30, 2025, the Company paid a total of $
Master Services Agreements – On December 31, 2024, the Company entered into one-year agreements with five customers to provide access to the NexGenAI Affiliates Network platform. Under the terms of these agreements, the Company is obligated to deliver platform access and related services over the contract period beginning in 2025. Revenue recognition will commence upon the start of services in accordance with ASC 606, Revenue from Contracts with Customers. As these agreements represent future contractual obligations, there was no impact on the Company’s financial position, results of operations, or cash flows as of December 31, 2024. The total contract value associated with these agreements is approximately $1.6 million, which is expected to be recognized as revenue over the respective service periods in 2025.
NOTE 12 – 401(k) PROFIT-SHARING PLAN
The Company sponsors a qualified
profit-sharing plan with a 401(k) feature that covers all eligible employees. Participation in the 401(k) feature of the plan is
voluntary. Participating employees may defer up to 100% of their compensation up to the maximum prescribed by the Internal Revenue
Code. The plan permits for employee elective deferrals but has no contribution requirements for the Company. During the six months
ended June 30, 2025 and 2024,
NOTE 13 – INCOME TAXES
For the six months ended June 30, 2025 and 2024,
respectively,
| 26 |
NOTE 14 – RELATED PARTY TRANSACTION
In September 2023, the Company entered into a
transaction with AG Bio Life Capital I LP (“AG”), a Delaware limited partnership, where an employee of the Company is the
general partner. The Company agreed to issue
As of June 30, 2025, the Company holds investments in certain privately held companies, recorded as investments on the Company’s condensed consolidated balance sheets. The Company’s Chief Executive Officer and Chief Financial Officer each hold ownership interests in these privately held companies.
As of June 30, 2025 and December 31, 2024, the
Company’s carrying value of these investments was $
NOTE 15 – INTANGIBLE ASSETS
On December 19, 2024, the Company acquired the
assets of NexGenAI Affiliates Network Platform (“NexGenAI”), from the seller NexGenAI Solutions Group, Inc., which contains
AI-powered marketing software and robotic process automation capabilities. The acquired assets include intellectual property, a domain
name and associated website, and the technology stack as defined in the agreement. As consideration for the purchase, the Company paid
the seller
The Company accounted for the NexGenAI transaction as an asset acquisition in accordance with ASC 805-50, Business Combinations – Asset Acquisitions, and recorded as intangible assets on the condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024.
NOTE 16 – SEGMENT REPORTING
Operating segments are components of an enterprise about which separate financial information is available and is evaluated regularly by management, namely the Chief Operating Decision Maker (“CODM”) of an organization, in order to determine operating and resource allocation decisions. By this definition, the Company has identified its Chief Executive Officer as the CODM. Effective in 2024, the Company began operating in two segments: Biotechnology and Technology. Prior to 2024, the Company did not report operating segments.
Biotechnology Segment: This segment is non-revenue
generating and incurs expenses by developing its biotechnology product pipeline. The Biotechnology Segment had total assets of $
Technology Segment:
This segment is revenue generating and incurs expenses by acquiring technology assets to support and enhance operational capabilities
through advanced technologies. The Technology Segment had total assets of $
| 27 |
The Company believes that this structure reflects its current operational and financial management, and that it provides the best structure for the Company to focus on growth opportunities while maintaining financial discipline. The factors used to identify the Biotechnology and Technology operating segments were the difference in future potential revenue streams and customer base for each segment, the reporting structure for operational and performance information within the Company, and management’s decision to organize the Company around the different future potential revenue generating activities of the segments.
Segment information relating the Company's two operating segments for the three and six months ended June 30, 2025 and 2024 is as follows:
| Schedule of segment information | ||||||||||||
Three Months Ended June 30, 2025 | ||||||||||||
Biotechnology Segment | Technology Segment | Consolidated | ||||||||||
| Sales | $ | $ | $ | |||||||||
| Cost of goods sold | ||||||||||||
| Total operating expenses | ||||||||||||
| Net loss from operations | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Three Months Ended June 30, 2024 | ||||||||||||
Biotechnology Segment | Technology Segment | Consolidated | ||||||||||
| Sales | $ | $ | $ | |||||||||
| Cost of goods sold | ||||||||||||
| Total operating expenses | ||||||||||||
| Net loss from operations | $ | ( | ) | $ | $ | ( | ) | |||||
Six Months Ended June 30, 2025 | ||||||||||||
Biotechnology Segment | Technology Segment | Consolidated | ||||||||||
| Sales | $ | $ | $ | |||||||||
| Cost of goods sold | ||||||||||||
| Total operating expenses | ||||||||||||
| Net loss from operations | $ | ( | ) | $ | ( | ) | $ | ( | ) | |||
Six Months Ended June 30, 2024 | ||||||||||||
Biotechnology Segment | Technology Segment | Consolidated | ||||||||||
| Sales | $ | $ | $ | |||||||||
| Cost of goods sold | ||||||||||||
| Total operating expenses | ||||||||||||
| Net loss from operations | $ | ( | ) | $ | $ | ( | ) | |||||
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NOTE 17 – PENDING MERGER TRANSACTION
On April 25, 2025, the Company (“Coeptis” or the “Purchaser”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with CP Merger Sub Inc., a Wyoming corporation and wholly-owned subsidiary of Coeptis (“Merger Sub”), and Z Squared, Inc., a Wyoming corporation (“Z Squared”).
Pursuant to the Merger Agreement, subject to the terms and conditions set forth therein, upon the consummation of the transactions contemplated by the Merger Agreement (the “Closing”), (i) Merger Sub will merge with and into Z Squared (the “Merger”) and (ii) Coeptis will immediately prior to the Merger effect a spin out of its biotechnology operations (the “Spin Out” and, together with Merger and the other transactions contemplated by the Merger Agreement, the “Transactions”), with Z squared continuing as the surviving corporation in the Merger and becoming a wholly-owned subsidiary of Coeptis.
In the Merger, all shares of Z Squared common stock issued and outstanding immediately prior to the effective time of the Merger (other than those properly exercising any applicable dissenters rights under Wyoming law), will be converted into the right to receive a portion of the Merger Consideration (as defined below) and (ii) any other outstanding securities with the right to convert into or acquire equity securities of Z Squared will be terminated. At the Closing, Coeptis will change its name as mutually agreed upon by the Purchaser and Z Squared. The Merger is expected to close in 2025.
In connection with the Spin Out, all of Coeptis’ assets comprising its biotechnology business will be assigned and contributed prior to Closing to one or more Spin Out Subsidiaries, which will then spin out to Coeptis’ stockholders of record on the record date established for the Coeptis Special Meeting (as defined below).
The aggregate Merger Consideration received by Z Squared security holders from Coeptis at the Closing will be a number of shares of Purchaser Common Stock that represents at Closing the Applicable Percentage of Purchaser’s issued and outstanding shares of Purchaser Common Stock as calculated on a Fully-Diluted Basis.
NOTE 18 – SUBSEQUENT EVENTS
Management has performed a review of all events and transactions occurring after June 30, 2025 for items that would require adjustment to or disclosure in the accompanying condensed consolidated financial statements, noting no such items or transactions other than the following.
On July 11, 2025, the Company commenced a private placement common stock offering with a $2,500,000 minimum offering amount and a maximum offering amount of $5,000,000. The Company may in its discretion opt for an initial closing followed by rolling closings thereafter, and it is anticipated that the initial closing will occur once the Company has accepted subscriptions and received funds and other funding documents for at least the minimum offering amount, and that the last closing will occur no later than thirty days following the initial closing.
The price per share of common stock shall be an amount equal to 105% of the closing bid price per share of common stock on the Nasdaq Capital Market as of the trading day immediately preceding the initial closing; provided that if the Company utilizes rolling closings following the initial closing, the price per share for each subsequent closing shall be equal to the greater of (i) the price per share in the Initial Closing and (ii) an amount equal to 105% of the closing bid price per share of common stock on the Nasdaq Capital Market as of the trading day immediately preceding the applicable rolling closing. Proceeds from the offering will be used for working capital and general corporate purposes for both the Company and its subsidiary, SNAP Biosciences, Inc.
On July 14, 2025, Yorkville elected to convert all of the outstanding principal and interest balance of the January 2025 convertible promissory note. Yorkville converted $1,143,397 into 158,582 shares of common stock at a weighted average purchase price of $7.21 per share.
On July 25, 2025, the Company and a holder of its preferred stock, who is also a party to an existing consulting agreement with the Company, entered into an addendum to amend the terms of the consulting arrangement. Under the amendment, the Company agreed to prepay the final six months of the consulting agreement by offsetting the outstanding $125,000 subscription receivable previously recorded from the shareholder. The prepayment will be amortized over the remaining term of the consulting agreement as services are rendered, thereby reducing the subscription receivable balance over time.
On July 29, 2025, the final 625 shares of the series A preferred stock were converted to common stock.
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| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
As discussed elsewhere in this Quarterly Report on Form 10-K, pursuant to the Merger, we acquired our primary operating subsidiary Coeptis Therapeutics, Inc. The Merger was accounted for as a “reverse merger,” and Coeptis Therapeutics, Inc. was deemed to be the accounting acquirer in the Merger. Consequently, the financial condition, results of operations and cash flows discussed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations discussed below are those of Coeptis Therapeutics, Inc. and its consolidated subsidiaries. When we use words in this section like “we,” “us”, “our,” the “Company” and words of the like, unless otherwise indicated, we are referring to the operations of our wholly-owned subsidiaries, including Coeptis Therapeutics, Inc.
Forward-Looking Statements
This Report contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 12E of the Securities Exchange Act of 1934, including or related to our future results, certain projections and business trends. Assumptions relating to forward-looking statements involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. When used in this Report, the words “estimate,” “project,” “intend,” “believe,” “expect” and similar expressions are intended to identify forward-looking statements. Although we believe that assumptions underlying the forward-looking statements are reasonable, any of the assumptions could prove inaccurate, and we may not realize the results contemplated by the forward-looking statement. Management decisions are subjective in many respects and susceptible to interpretations and periodic revisions based on actual experience and business developments, the impact of which may cause us to alter our business strategy or capital expenditure plans that may, in turn, affect our results of operations. In light of the significant uncertainties inherent in the forward-looking information included in this Report, you should not regard the inclusion of such information as our representation that we will achieve any strategy, objective or other plans. The forward-looking statements contained in this Report speak only as of the date of this Report as stated on the front cover, and we have no obligation to update publicly or revise any of these forward-looking statements. These and other statements which are not historical facts are based largely on management’s current expectations and assumptions and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by such forward-looking statements. These risks and uncertainties include, among others, the failure to successfully develop a profitable business, delays in identifying customers, and the inability to retain a significant number of customers, as well as the risks and uncertainties described in “Risk Factors” section to our Annual Report for the fiscal year ended December 31, 2024.
When we use works like “we,” “us”, “our,” the “company” and words of the like, unless otherwise indicated, we are referring to the operations of us and our wholly-owned subsidiaries Coeptis Therapeutics, Inc. and Coeptis Pharmaceuticals, Inc. (“Coeptis”).
Objective
The objective of our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is to provide users of our financial statements with the following:
| · | A narrative explanation from the perspective of management of our financial condition, results of operations, cash flows, liquidity and certain other factors that may affect future results; | |
| · | Useful context to the financial statements; and | |
| · | Information that allows assessment of the likelihood that past performance is indicative of future performance. |
Our MD&A is provided as a supplement to, and should be read together with, our unaudited condensed consolidated financial statements for the three and six months ended June 30, 2025 and 2024, included in Part I, Item 1 of this Form 10-Q.
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Company History
General. The Company was originally incorporated in the British Virgin Islands on November 27, 2018 under the name Bull Horn Holdings Corp. On October 27, 2022, Bull Horn Holdings Corp. domesticated from the British Virgin Islands to the State of Delaware. On October 28, 2022, in connection with the closing of the Merger, the Company changed its corporate name from Bull Horn Holdings Corp. to “Coeptis Therapeutics Holdings, Inc.”
The Merger Transaction. On October 28, 2022, a wholly-owned subsidiary of Bull Horn Holdings Corp., merged with and into Coeptis Therapeutics, Inc., with Coeptis Therapeutics, Inc. as the surviving corporation of the Merger. As a result of the Merger, the Company acquired the business of Coeptis Therapeutics, Inc., which now continues its existing business operations as the Company’s wholly-owned subsidiary.
About the Company’s Subsidiaries. We are now a holding company that currently operates through our direct and indirect subsidiaries SNAP Biosciences, Inc. and GEAR Therapeutics, Inc., which are majority owned, and Coeptis Therapeutics, Inc., Coeptis Pharmaceuticals, Inc. and Coeptis Pharmaceuticals, LLC, which are wholly owned.
Company History of Coeptis Therapeutics, Inc.
Coeptis Pharmaceuticals, LLC was formed on July 12, 2017 as a Pennsylvania multi-member limited liability company. On December 1, 2018, the members of LLC contributed their interest to a newly formed corporation, Coeptis Pharmaceuticals, Inc. As of December 1, 2018, the LLC became a disregarded single-member limited liability company which is wholly owned by the newly formed corporation. On February 12, 2021, Vinings Holdings, Inc., a Delaware corporation (“Vinings”), merged (the “Merger”) with and into Coeptis Pharmaceuticals, Inc. On July 12, 2021, the company has legally changed its name from Vinings Holdings, Inc. to Coeptis Therapeutics, Inc. Coeptis was the surviving corporation of that Merger. As a result of the Merger, Vinings acquired the business of Coeptis and will continue the existing business operations of Coeptis as a wholly owned subsidiary. The Merger was treated as a recapitalization of the Company for financial accounting purposes. The historical financial statements of Vinings before the Merger were replaced with the historical financial statements of Coeptis before the Merger in all future filings with the Securities and Exchange Commission (the “SEC”).
Overview and Outlook
We are a biopharmaceutical and technology company which owns, acquires, and develops cell therapy technologies for cancer and other diseases. Our products and technologies are intended to be commercialized in the US and other major markets throughout the world. Since our inception in 2017, we have acquired and commercialized two drug products for the US market, which were approved as 505b2 applications. These anti-hypertension products were launched into the US market during 2020 through a marketing partner. At launch, the sales and promotional efforts were significantly impeded by the limitation of the global pandemic and as such, we have since abandoned all activities and ownership pertaining to both products. We also began the development of several ANDA products which we divested in 2019 to a larger generic pharmaceutical drug manufacturer and have moved away from focusing on the commercialization of generic products. In early 2021, we entered into strategic partnerships to co-develop improved therapies for the auto-immune and oncology markets. Following the reverse merger transaction, we continue to focus on identifying and investing resources into innovative products and technologies which we believe will significantly transform our current products and therapies.
During 2020 and continuing through 2021, we faced several operational challenges related to the COVID-19 global pandemic, which we continue to work to overcome. The launch of both 5050b2 products was impacted because of various COVID-19 limitations, most notably field sales personnel were not able to make healthcare provider visits in person; thereby limiting the awareness of the availability of these products. We explored and implemented several non-personal promotion efforts, but given the global limitations and dynamics, it was challenging to achieve expected sales. We have since abandoned all activities and ownership pertaining to both products.
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Biotechnology Segment
Vy-Gen-Bio, Inc.
In May 2021, we entered into two exclusive option agreements (the “CD38 Agreements”) relating to separate technologies designed to improve the treatment of CD38-related cancers (e.g., multiple myeloma, chronic lymphocytic leukemia, and acute myeloid leukemia) with Vy-Gen-Bio, Inc. (“Vy-Gen”), a majority-owned subsidiary of Vycellix, Inc., a Tampa, Florida-based private, immuno-centric discovery life science company focused on the development of transformational platform technologies to enhance and optimize next-generation cell and gene-based therapies, including T-cell and Natural Killer (NK) cell-based cancer therapies.
The CD38 Agreements relate to two separate Vy-Gen drug product candidates, as follows:
CD38-GEAR-NK. This Vy-Gen drug product candidate is designed to protect CD38+ NK cells from destruction by anti-CD38 monoclonal antibodies, or mAbs. CD38-GEAR-NK is an autologous, NK cell-based therapeutic that is derived from a patient’s own cells and gene-edited to enable combination therapy with anti-CD38 mAbs. We believe CD38-GEAR-NK possesses the potential to minimize the risks and side effects from CD38-positive NK cell fratricide.
Market Opportunity. We believe CD38-GEAR-NK could potentially revolutionize how CD38-related cancers are treated, by protecting CD38+ NK cells from destruction by anti-CD38 mAbs, thereby promoting the opportunity to improve the treatment of CD38-related cancers, including multiple myeloma, chronic lymphocytic leukemia, and acute myeloid leukemia.
Multiple myeloma is the first cancer indication targeted with CD38-GEAR-NK. The global multiple myeloma market was $19.48B in 2018 and is expected to reach $31B by 2026 [Source: Fortune Business Reports].
CD38-Diagnostic. This Vy-Gen product candidate is an in vitro diagnostic tool to analyze if cancer patients might be appropriate candidates for anti-CD38 mAb therapy. CD38-Diagnostic is an in vitro screening tool that provides the ability to pre-determine which cancer patients are most likely to benefit from targeted anti-CD38 mAb therapies, either as monotherapy or in combination with CD38-GEAR-NK. CD38-Diagnostic also has the potential to develop as a platform technology beyond CD38, to identify patients likely to benefit for broad range of mAb therapies across myriad indications.
Market Opportunity. We believe CD38-Diagnostic provides opportunity to make more cost-effective medical decisions for the treatment of B cell malignancies with high CD38 expression, including multiple myeloma, which may help to avoid unnecessary administration of anti-CD38 therapies. CD38-Diagnostic could prevent patients from being subjected to ineffective therapy and enable significant savings to healthcare systems.
CD38-Diagnostic could be offered as an in-vitro diagnostic for determining patient suitability and likelihood of positive treatment outcomes for CD38-GEAR-NK and/or CD38 monoclonal antibody therapies.
On September 28, 2023, we received FDA’s response to our 513(g) request for information submission pertaining to the classification of the CD38-Diagnostic. The CD38-Diagnostic has been designated a Class II type device. The confirmation of this classification is beneficial as we’re now better able to plan for and execute future development activities.
GEAR-NK Product Overview. GEAR-NK is an autologous, gene-edited, natural killer cell-based therapeutic development platform that allows for modified NK cells to be co-administered with targeted mAbs, which, in the absence of the GEAR-NK, would otherwise be neutralized by mAb therapy.
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In May 2021, we made initial payments totaling $750,000 under the CD38 Agreements, to acquire the exclusive options to acquire co-development rights with respect to CD38-GEAR-NK and CD38-Diagnostic. On August 15, 2021, we entered into amendments to each of the CD38 Agreements. In connection with the two amendments, we delivered to Vy-Gen promissory notes aggregating $3,250,000 with maturity dates of December 31, 2021, and made a cash payment of $1,000,000, upon which cash payment we exercised the two definitive option purchase agreements. In December 2021, we completed our payment obligations to secure the 50% ownership interest in the CD38-Diagnostic, and subsequently in November 2022 we completed our purchase of the 50% ownership interest for the CD38-GEAR-NK product candidate. Details of the two August amendments and the December amendment are summarized in the amendments attached at Exhibits 4.1 and 4.2 to our Current Report on Form 8-K dated August 19, 2021 and Exhibits 4.2 to the our Current Report on Form 8-K dated December 27, 2021.
In connection with the Vy-Gen relationship and the Company’s ownership in the two product candidates described above, in December 2021 the Company and Vy-Gen entered into a co-development and steering committee agreement. The co-development and steering committee agreement provides for the governance and economic agreements between the Company and Vy-Gen related of the development of the two Vy-Gen drug product candidates and the revenue sharing related thereto, including each company having a 50% representation on the steering committee and each company receiving 50% of the net revenues related to the Vy-Gen product candidates. Related to the joint development, under the direction of the joint steering committee, we are currently assessing market opportunities, intellectual property protection and potential regulatory strategies for the CD38 Assets, and Vy-Gen is overseeing the development activities being conducted through the scientists at Karolinska Institute. Details of the co-development and steering committee agreement are summarized in our Current Report on Form 8-K dated December 27, 2021, including Exhibits 4.1 and 4.2 thereto.
In March 2025, the Company reached an agreement with Vy-Gen-Bio, Inc. (“Vy-Gen”) to successfully license the exclusive worldwide development and commercialization rights to the GEAR™ (Gene Edited Antibody Resistant) Cell Therapy Platform, representing a first-in-class approach to modifying potent cancer-targeting immune cells to optimize the likelihood of deep remission in patients with hematologic malignancies and other cancers. Coeptis had previously held limited co-development rights to GEAR.
Deverra Therapeutics, Inc.
On August 16, 2023, the Company entered into an exclusive licensing arrangement (the “License Agreement”) with Deverra Therapeutics Inc. (“Deverra”), pursuant to which the Company completed the exclusive license of key patent families and related intellectual property related to a proprietary allogeneic stem cell expansion and directed differentiation platform for the generation of multiple distinct immune effector cell types, including natural killer (NK) and monocyte/macrophages. The License Agreement provides the Company with exclusive rights to use the license patents and related intellectual property in connection with development and commercialization efforts in the defined field of use (the “Field”) of (a) use of unmodified NK cells as anti-viral therapeutic for viral infections, and/or as a therapeutic approach for treatment of relapsed/refractory AML and high-risk MDS; (b) use of Deverra’s cell therapy platform to generate NK cells for the purpose of engineering with Coeptis SNAP-CARs and/or Coeptis GEAR Technology; and (c) use of Deverra’s cell therapy platform to generate myeloid cells for the purpose of engineering with the Company’s current SNAP-CAR and GEAR technologies. In support of the exclusive license, the Company also entered into with Deverra (i) an asset purchase agreement (the “APA”) pursuant to which the Company purchased certain assets from Deverra, including but not limited to two Investigational New Drug (IND) applications and two Phase 1 clinical trial stage programs (NCT04901416, NCT04900454) investigating infusion of DVX201, an unmodified natural killer (NK) cell therapy generated from pooled donor CD34+ cells, in hematologic malignancies and viral infections and (ii) a non-exclusive sublicense agreement (the “Sublicense Agreement”), in support of the assets obtained by the exclusive license, pursuant to which the Company sublicensed from Deverra certain assets which Deverra has rights to pursuant a license agreement (“FHCRC Agreement”) by and between Deverra and The Fred Hutchinson Cancer Research Center (“FHCRC”).
As consideration for the transactions described above, the Company paid Deverra approximately $570,000 in cash, issued to Deverra 4,000,000 shares of the Company’s common stock and assumed certain liabilities related to the ongoing clinical trials. Total consideration paid was $4,937,609, which was fully expensed in accordance with ASC 730, and is reflected within research and development in the accompanying condensed consolidated statement of operations for the year ended December 31, 2023. In addition, in accordance with the terms of the Sublicense Agreement, the Company agreed to pay FHCRC certain specified contingent running royalty payments and milestone payments under the FHCRC Agreement, in each case to the extent such payments are triggered by the Company’s development activities.
On October 26, 2023, the Company entered into a Shared Services Agreement (“SSA”) with Deverra, in accordance with requirements set forth in the APA. Under the terms of the SSA, Coeptis and Deverra will share resources and collaborate to further the development of Coeptis’ GEAR and SNAP-CAR platforms, as well as the purchased and licensed assets under the License Agreement and APA. The term of the SSA is six months from the effective date.
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Vici Health Sciences, LLC.
In 2019, we entered into a co-development agreement with Vici Health Sciences, LLC (“Vici”). Through this partnership, we would co-develop, seek FDA approval and share ownership rights with Vici to CPT60621, a novel, ready to use, easy to swallow, oral liquid version of an already approved drug used for the treatment of Parkinson’s Disease (PD). As we continue to direct its operational focus towards the Vy-Gen opportunities previously described, we have recently stopped allocating priority resources to the development of CPT60621. We are currently in negotiations in which Vici intends to buy-out most or all of our remaining ownership rights.
Technology Segment
NexGenAI Affiliates Network
On December 19, 2024, the Company acquired the assets of NexGenAI Affiliates Network Platform (“NexGenAI”), from the seller NexGenAI Solutions Group, Inc., which contains AI-powered marketing software and robotic process automation capabilities. The acquired assets include intellectual property, a domain name and associated website, and the technology stack as defined in the agreement.
The acquired assets include technology-enabled AI driven marketing automation platform, along with associated tools and infrastructure that enable the Company to offer managed digital marketing services under its own brand. Originally launched in the third quarter of 2023, the platform was developed to support client efforts in enhancing brand visibility, generating qualified leads, and advancing strategic growth initiatives. The Company’s managed service offerings now include lead generation, content marketing, social media marketing, email marketing, account-based marketing, marketing analytics, event marketing, and branding support.
The Company will utilize a proprietary suite of automation and virtual assistant technologies to streamline client outreach, engagement
workflows, and digital marketing operations across our operations.
Our Results of Operations
Revenue. To date, we have generated minimal revenue mostly from consulting arrangements and product sales. Due to the COVID-19 global pandemic and the resulting market dynamics, it is uncertain if the current marketed products can generate sufficient sales to cover expenses.
Operating Expenses. General and administrative expenses consist primarily of warrant expense related to strategic financing costs, salaries and related costs for personnel and professional fees for consulting services related to regulatory, pharmacovigilance, quality, legal, and business development. We expect that our general and administrative expenses will increase in the future as we increase our headcount to support the business growth. We also anticipate that we will incur increased accounting, audit, legal, regulatory, compliance, insurance, and investor relation expenses associated with operating as a public company.
Research and Development Costs. Research and developments costs will continue to be dependent on the strategic business collaborations and agreements will are anticipating in the future. We expect development costs to increase to support our new strategic initiatives.
Comparison of the three months ended June 30, 2025 and June 30, 2024
Revenues. Revenues recorded in the three months ended June 30, 2025 and 2024 remained minimal, as the NexGenAI platform purchased in the fourth quarter of 2024 started generating revenue in the first quarter of 2025. The Company’s activities primarily include product development, raising capital, and building infrastructure. Management does not expect the Company to generate any significant revenue for at least the next two years, during which time drug development will continue toward the goal of commercializing, through a partnership or otherwise, one or more of the Company’s target products or technologies.
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Operating Expenses
Overview. Operating expenses increased from $2,828,102 in the three months ended June 30, 2024 to $4,676,738 in the three months ended June 30, 2025. The increase in professional services expense is primarily related to consulting and legal fees in connection with the Merger Agreement. For the three months ended June 30, 2025, stock based compensation expense was lower compared to the same period in 2024, primarily due to a one-time stock option grant to the Company’s CEO in the second quarter of 2024. The year-over-year decrease in research and development expense is primarily a result of the SSA termination with Deverra Therapeutics in December, 2024.
General and Administrative Expenses. For the three months ended June 30, 2025 and 2024, general and administrative expenses are included in operating expenses. All costs incurred can be attributed to the planned principal operations of product development, raising capital, and building infrastructure.
Interest Expense. Interest expense was $66,056 for the three months ended June 30, 2024 and was $67,788 for the three months ended June 30, 2025.
Change in Fair Value of Derivative Liabilities. The change in fair value for the three months ended June 30, 2024 was $(149,250) and was $202,310 for the three months ended June 30, 2025. The change in value of the derivative liability warrants, and resulting gain, is a result of a drop in the implied volatility of the warrants and the shortened expiration time, as well as a decrease in the principal amount of the related convertible note in combination with an increase in the common share price during the period, leading to a reduced number of shares available to be converted.
Comparison of the six months ended June 30, 2025 and June 30, 2024
Revenues. Revenues recorded in the six months ended June 30, 2025 and 2024 were $263,555 and $0 respectively. The Company’s revenue generating activities are a result of the lead generation and webinar services of its NexGenAI Affiliates Network platform within its Technology segment. The activities of the Company’s Biotechnology segment primarily include product development, raising capital, and building infrastructure. Management will continue to pursue drug development toward the goal of commercializing, through a partnership or otherwise, one or more of the Company’s target products or technologies.
Operating Expenses
Overview. Operating expenses increased from $5,750,485 in the six months ended June 30, 2024 to $8,751,440 in the six months ended June 30, 2025. The increase in professional services expense is primarily related to consulting and legal fees in connection with the Merger Agreement. Stock based compensation expense increased year-over year as a result of the 2025 stock option grants. The year-over-year decrease in Research and development expense is primarily a result of the SSA termination with Deverra Therapeutics in December, 2024.
General and Administrative Expenses. For the six months ended June 30, 2025 and 2024, general and administrative expenses are included in operating expenses. All costs incurred can be attributed to the planned principal operations of product development, raising capital, and building infrastructure.
Interest Expense. Interest expense was $266,561 for the six months ended June 30, 2024 and was $139,279 for the six months ended June 30, 2025. The decrease was primarily a result of the satisfaction of the Purple Biotech convertible note. Interest expense related to notes payable, which are discussed in detail in the notes to the condensed consolidated financial statements, incorporated by reference herein.
Change in Fair Value of Derivative Liabilities. The change in fair value for the six months ended June 30, 2024 was $(114,375) and was $798,430 for the six months ended June 30, 2025. The change in value of the derivative liability warrants, and resulting gain, is a result of a drop in the implied volatility of the warrants and the shortened expiration time, as well as a decrease in the principal amount of the related convertible note in combination with an increase in the common share price during the period, leading to a reduced number of shares available to be converted.
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Financial Resources and Liquidity. The Company had limited financial resources during the six months ended June 30, 2024 with cash of $1,555,075. For the period ended June 30, 2025, cash and cash equivalents increased to $1,996,726. During both these time periods, the Company continues to operate a minimal infrastructure in order to maintain its ability to fund operations, keep full focus on all product development targets and to stay current with all of the Company’s scientist consultants, legal counsel, and accountants. During 2025, the Company believes that the ability to raise capital through equity transactions will increase liquidity and enable the execution of management’s operating strategy.
| Item 3. | Quantitative and Qualitative Disclosures about Market Risk |
The Company is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information under this Item.
| Item 4. | Controls and Procedures |
Disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
Our Annual Report on Form 10-K contains information regarding self-identified material weaknesses in our internal control over financial reporting as of December 31, 2023. For example, the Company’s system of internal controls, as designed and implemented, were not operating effectively. Additionally, the Company’s financial statement close process and disclosure controls and procedures were not operating effectively.
Over the course of the year ended December 31, 2024, the Company worked toward remediation of these self-identified material weaknesses by (i) hiring additional resources to effectively allow for segregation of duties and highly technical accounting expertise, formally documenting accounting policies, and ensuring compliance with accounting requirements and (ii) adopting processes and procedures that support a timely financial statement close, and secondary reviews.
Our management, with the participation of our chief executive officer (our principal executive officer) and our chief financial officer (our principal financial officer) evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this Report on Form 10-Q. Based upon that evaluation, and as a result of the remediation efforts following the 2023 self-diagnosed material weaknesses described below, our principal executive officer and principal financial officer concluded that, as of June 30, 2025, our disclosure controls and procedures were effective.
Accordingly, the Company believes, based on its knowledge, that: (i) this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which they were made, not misleading with respect to the period covered by this report; and (ii) the financial statements, and other financial information included in this quarterly report, fairly present in all material respects our financial condition, results of operations and cash flows as of and for the periods presented in this quarterly report.
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PART II — OTHER INFORMATION
| Item 1. | Legal Proceedings |
None.
| Item 1A. | Risk Factors |
In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2024, which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
All prior sales of unregistered securities have been properly disclosed in prior SEC filing.
| Item 3. | Defaults Upon Senior Securities |
Not applicable.
| Item 4. | Mine Safety Disclosures |
Not applicable.
| Item 5. | Other Information |
During the
quarter ended June 30, 2025, no director or officer of the Company
| Item 6. | Exhibits |
The following exhibits are attached hereto or incorporated by reference herein (numbered to correspond to Item 601(a) of Regulation S-K, as promulgated by the Securities and Exchange Commission) and are filed as part of this Form 10-Q:
| 31.1 | Rule 13a-14(a)/15(d)-14(a) Certification of Chief Executive Officer, Principal Executive Officer. Filed herewith. |
| 31.2 | Rule 13a-14(a)/15(d)-14(a) Certification of President, Principal Financial Officer. Filed herewith. |
| 32.1 | Section 1350 Certification of Principal Executive Officer. Filed herewith. |
| 32.2 | Section 1350 Certification of Principal Financial Officer. Filed herewith. |
| 101.INS | XBRL Instance Document |
| 101.SCH | XBRL Taxonomy Extension Schema |
| 101.CAL | XBRL Taxonomy Extension Calculation Linkbase |
| 101.DEF | XBRL Taxonomy Extension Definition Linkbase |
| 101.LAB | XBRL Taxonomy Extension Label Linkbase |
| 101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
| 37 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| COEPTIS THERAPEUTICS HOLDINGS, INC. | ||
| Registrant | ||
| Date: August 14, 2025 | By: | /s/ David Mehalick |
| David Mehalick | ||
| Chief Executive Officer, Principal Executive Officer | ||
| Date: August 14, 2025 | By: | /s/ Brian Cogley |
| Brian Cogley | ||
| Chief Financial Officer, Principal Financial and Accounting Officer | ||
| 38 |
FAQ
What was COEP’s net loss for the six months ended June 30, 2025?
Does the 10-Q state any going concern issues for COEP?
What equity restructuring did COEP complete?
Were there any significant debt conversions or financing actions?
How many common shares were outstanding after the reporting period?
What material liabilities remain on COEP’s balance sheet?
