Revenue and Financial Performance - Revenue for the three months ended October 31, 2024, was 645,796,representinga50.9427,841 in the same period of 2023[15]. - Total revenue for the nine months ended October 31, 2024, was 1,497,158,comparedto1,560,701 for the same period in 2023, representing a decrease of approximately 4.05%[47]. - Revenue from the sale of goods was 1,497,158fortheninemonthsendedOctober31,2024,comparedto1,395,667 for the same period in 2023, indicating an increase of approximately 7.27%[47]. - For the three months ended October 31, 2024, the net loss was 1,362,637,comparedtoanetlossof1,759,946 for the same period in 2023, representing a decrease of approximately 22.5%[17][18]. - The company reported a net loss from operations of 4,726,060fortheninemonthsendedOctober31,2024,comparedtoanetlossof3,604,348 for the same period in 2023, indicating an increase in operational losses[21][34]. Assets and Liabilities - Total current assets increased to 6,191,602asofOctober31,2024,comparedto1,021,863 as of January 31, 2024[13]. - Total liabilities as of October 31, 2024, were 1,311,503,comparedto1,078,919 as of January 31, 2024, showing a 21.5% increase[13]. - Cash and cash equivalents increased to 5,698,187asofOctober31,2024,from492,942 as of January 31, 2024[13]. - The total working capital as of October 31, 2024, was 4,934,816,comparedtoaworkingcapitaldeficitof(26,099,053) as of October 31, 2023, reflecting a substantial turnaround[18][34]. - As of October 31, 2024, the company had cash and cash equivalents of 5,698,187,anincreasefrom1,265,323 as of October 31, 2023, indicating a significant improvement in liquidity[21][34]. Research and Development - Research and development expenses for the three months ended October 31, 2024, were 880,768,upfrom551,503 in the same period of 2023, indicating a 59.6% increase[15]. - Research and development expenses for the Aversa Fentanyl product totaled 2,629,278fortheninemonthsendedOctober31,2024,anincreaseof88.51,397,055 for the same period in 2023[165]. - The company is focused on developing transdermal pharmaceutical products, with a primary emphasis on incorporating its Aversa abuse deterrent technology into existing approved drugs[26]. - The company requires approximately 13millionforresearchanddevelopmentofitsabusedeterrentfentanyltransdermalsystem,whichincludesclinicalmanufacturingandclinicaltrials[147].−ThecompanyhasenteredintoacommercialdevelopmentagreementwithKindevaDrugDeliveryforAversaFentanyl,withanestimatedcostof8.1 million for completion[129]. Financing and Capital Structure - The company raised 8,400,000fromequityfinancingwithEuropeaninvestorsonApril19,2024,whichwillsupportongoingresearchanddevelopmentefforts[34].−Thecompanyhasreliedonsalesofsecuritiesandissuanceofdebttosupportcashflowfromoperations,highlightingitsongoingneedforexternalfinancing[34].−Thecompanyhasacreditlinefacilityof5,000,000, which was amended in July 2023, to fund research and development of its Aversa product[34]. - The company completed an 8,400,000equityfinancingonApril19,2024,issuing2,100,000unitsatapriceof4.00 per unit, each consisting of one share of common stock and a warrant[156]. - The company entered into an amended three-year 5,000,000creditlinefacilityonJuly13,2023,replacingaprevious2,000,000 facility, with drawdowns bearing interest at 7% per annum[154]. Expenses and Cost Management - Total costs and expenses for the nine months ended October 31, 2024, were 6,223,218,comparedto5,126,278 for the same period in 2023, reflecting a 21.5% increase[15]. - Operating expenses totaled 5,183,433fortheninemonthsendedOctober2024,comparedto4,269,915 for the same period in 2023, representing an increase of approximately 21.4%[123]. - Selling, general and administrative expenses decreased to 737,102forthethreemonthsendedOctober31,2024,downfrom1,330,929 in the same period in 2023, a reduction of approximately 44%[159]. - Selling, general and administrative expenses for the nine months ended October 31, 2024, were 2,554,155,adecreaseof10.42,849,399 for the same period in 2023[164]. - The company recorded bad debt expenses of 1,200fortheninemonthsendedOctober31,2024,significantlylowerthan11,836 for the same period in 2023, reflecting improved credit management[51]. Stock and Equity - The weighted average shares of common stock outstanding for the three months ended October 31, 2024, were 11,101,945, compared to 7,833,150 in the same period of 2023[15]. - The total number of outstanding options as of October 31, 2024, is 1,324,835, with an intrinsic value of 4,139,797[120].−Thecompanyhasreservedatotalof1,400,000sharesundertheEmployeeStockOptionPlan,pendingstockholderapproval[115].−TheCompanyissued450,000optionstopurchasesharesatpricesrangingfrom2.37 to 5.99duringtheninemonthsendedOctober31,2024[116].−AsofOctober31,2024,thereare5,597,998warrantsoutstandingwithanaverageexercisepriceof6.35 and an intrinsic value of $314,199[109]. Compliance and Governance - The company recognized revenue from contracts with customers based on five criteria established under Topic 606, ensuring compliance with updated revenue recognition standards[39]. - The company applies a "right-of-use" model for lease accounting, recording operating lease liabilities on its balance sheet in accordance with ASU 2016-02[61]. - The company utilizes fair value measurements for financial and non-financial assets and liabilities, adhering to the fair value hierarchy established by ASC 820[68]. - The Company applies the asset and liability method for income taxes, recognizing deferred tax assets and liabilities based on future tax consequences[205]. - The Company concluded that its disclosure controls and procedures are not effective in ensuring timely and accurate reporting as required by SEC rules[209].
