[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents the unaudited interim financial statements, management's discussion, market risk disclosures, and controls and procedures for CNS Pharmaceuticals, Inc [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited interim financial statements, including Balance Sheets, Statements of Operations, Equity, Cash Flows, and comprehensive Notes, for periods ended June 30, 2024, and December 31, 2023 [Balance Sheets](index=4&type=section&id=Balance%20Sheets%20as%20of%20June%2030%2C%202024%20and%20December%2031%2C%202023%20%28unaudited%29) Presents the company's financial position, including assets, liabilities, and equity, as of June 30, 2024, and December 31, 2023 **Balance Sheet Highlights:** | Metric | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,491,559 | $548,721 | | Total current assets | $2,145,396 | $1,591,170 | | Total assets | $2,469,269 | $1,700,853 | | Accounts payable and accrued expenses | $6,639,622 | $5,832,162 | | Notes payable | $123,248 | $300,806 | | Total current liabilities | $6,762,870 | $6,132,968 | | Total liabilities | $6,762,870 | $6,132,968 | | Total Stockholders' Equity (Deficit) | $(4,293,601) | $(4,432,115) | [Statements of Operations](index=5&type=section&id=Statements%20of%20Operations%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202024%20and%202023%20%28unaudited%29) Details the company's revenues, expenses, and net loss for the three and six months ended June 30, 2024, and 2023 **Statements of Operations Highlights:** | Metric | Three Months Ended June 30, 2024 | Three Months Ended June 30, 2023 | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | General and administrative | $1,411,573 | $1,179,833 | $2,526,015 | $2,538,585 | | Research and development | $1,116,562 | $2,845,553 | $3,546,974 | $6,413,312 | | Total operating expenses | $2,528,135 | $4,025,386 | $6,072,989 | $8,951,897 | | Loss from operations | $(2,528,135) | $(4,025,386) | $(6,072,989) | $(8,951,897) | | Net loss | $(2,530,753) | $(4,021,234) | $(6,075,501) | $(8,953,181) | | Loss per share - basic | $(6.72) | $(51.86) | $(22.08) | $(154.70) | | Loss per share - diluted | $(6.72) | $(51.86) | $(22.08) | $(154.70) | | Weighted average shares outstanding - basic | 376,643 | 77,547 | 275,113 | 57,874 | | Weighted average shares outstanding - diluted | 376,643 | 77,547 | 275,113 | 57,874 | [Statements of Stockholders' Equity (Deficit)](index=6&type=section&id=Statements%20of%20Stockholders%27%20Equity%20%28Deficit%29%20for%20the%20six%20months%20ended%20June%2030%2C%202024%20and%202023%20%28unaudited%29) Outlines changes in the company's equity, including common stock, additional paid-in capital, and accumulated deficit, for the six months ended June 30, 2024, and 2023 **Statements of Stockholders' Equity (Deficit) Highlights (Six Months Ended June 30, 2024):** | Item | Shares | Common Stock Amount | Additional Paid-in Capital | Accumulated Deficit | Total Stockholders' Equity (Deficit) | | :--- | :--- | :--- | :--- | :--- | :--- | | Balance December 31, 2023 | 124,306 | $124 | $65,134,664 | $(69,566,903) | $(4,432,115) | | Common stock issued for cash, net | 44,314 | $44 | $3,330,954 | – | $3,330,998 | | Exercise of warrants, net | 44,774 | $45 | $12,360 | – | $12,405 | | Stock-based compensation | – | – | $202,933 | – | $202,933 | | Net loss | – | – | – | $(3,544,748) | $(3,544,748) | | Balance, March 31, 2024 | 213,394 | $213 | $68,680,911 | $(73,111,651) | $(4,430,527) | | Common stock issued for cash and warrants, net | 904,000 | $904 | $2,423,509 | – | $2,424,413 | | Exercise of warrants, net | 208,260 | $208 | $8,713 | – | $8,921 | | Stock-based compensation | – | – | $234,345 | – | $234,345 | | Adjustment related to reverse stock split | 117,620 | $118 | $(118) | – | – | | Net loss | – | – | – | $(2,530,753) | $(2,530,753) | | Balance, June 30, 2024 | 1,443,274 | $1,443 | $71,347,360 | $(75,642,404) | $(4,293,601) | [Statements of Cash Flows](index=7&type=section&id=Statements%20of%20Cash%20Flows%20for%20the%20six%20months%20ended%20June%2030%2C%202024%20and%202023%20%28unaudited%29) Reports the cash inflows and outflows from operating, investing, and financing activities for the six months ended June 30, 2024, and 2023 **Statements of Cash Flows Highlights:** | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Net loss | $(6,075,501) | $(8,953,181) | | Stock-based compensation | $437,278 | $579,983 | | Depreciation | $1,570 | $2,282 | | Prepaid expenses and other current assets (change) | $(13,067) | $823,073 | | Accounts payable and accrued expenses (change) | $807,460 | $(679,516) | | Net cash used in operating activities | $(4,842,450) | $(8,227,359) | | Payments of deferred offering costs | $(16,750) | – | | Payments on notes payable | $(177,558) | $(243,572) | | Proceeds from exercise of warrants | $21,326 | $725,668 | | Proceeds from sale of common stock and warrants, net | $5,958,270 | $1,969,107 | | Net cash provided by financing activities | $5,785,288 | $2,451,203 | | Net change in cash and cash equivalents | $942,838 | $(5,776,156) | | Cash and cash equivalents, at beginning of period | $548,721 | $10,055,407 | | Cash and cash equivalents, at end of period | $1,491,559 | $4,279,251 | | Cash paid for interest | $11,088 | $9,086 | | Cash paid for income taxes | – | – | | Reclassification of deferred offering costs to equity | $202,859 | – | [Notes to the Financial Statements](index=8&type=section&id=Notes%20to%20the%20Financial%20Statements%20%28unaudited%29) Provides detailed explanations of accounting policies, equity changes, commitments, and subsequent events supporting the financial statements [Note 1 – Nature of Business](index=8&type=section&id=Note%201%20%E2%80%93%20Nature%20of%20Business) CNS Pharmaceuticals, Inc. is a clinical pharmaceutical company focused on developing anti-cancer drug candidates. The company underwent two reverse stock splits, one on November 28, 2022 (1-for-30) and another on June 4, 2024 (1-for-50), both retroactively adjusted in the financial statements - The Company is a clinical pharmaceutical company focused on the development of anti-cancer drug candidates[12](index=12&type=chunk) - A **1-for-30 reverse stock split** became effective on November 28, 2022, retroactively adjusted in financial statements[12](index=12&type=chunk) - A **1-for-50 reverse stock split** became effective on June 4, 2024, retroactively adjusted in financial statements[13](index=13&type=chunk) [Note 2 – Summary of Significant Accounting Policies](index=8&type=section&id=Note%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the company's significant accounting policies, including the basis of presentation for unaudited interim financial statements, the going concern assumption, and policies for cash and cash equivalents, stock-based compensation (RSUs and PUs), and loss per common share. The company acknowledges substantial doubt about its ability to continue as a going concern due to historical negative cash flows and net losses, and its reliance on future equity financings [Basis of Presentation](index=8&type=section&id=Basis%20of%20Presentation) Describes the preparation of unaudited interim financial statements in accordance with U.S. GAAP - Unaudited financial statements are prepared in accordance with U.S. GAAP for interim financial information[14](index=14&type=chunk) - Operating results for the three and six months ended June 30, 2024, are not necessarily indicative of the final results for the year ending December 31, 2024[14](index=14&type=chunk) [Liquidity and Going Concern](index=8&type=section&id=Liquidity%20and%20Going%20Concern) Addresses the company's ability to continue operations, highlighting reliance on financing and historical negative cash flows - The Company's continuation as a going concern is dependent upon obtaining equity financings to continue operations[15](index=15&type=chunk) - A history of negative cash flows from operations and net losses raises substantial doubt regarding the Company's ability to continue as a going concern[15](index=15&type=chunk) - Management believes cash on hand is sufficient to fund planned operations into but not beyond the near term[15](index=15&type=chunk) [Cash and Cash Equivalents](index=9&type=section&id=Cash%20and%20Cash%20Equivalents) Defines cash equivalents and notes the portion of cash balances exceeding federally insured limits - Cash equivalents include highly liquid accounts with original maturities of **three months or less**[17](index=17&type=chunk) - As of June 30, 2024, **$1,241,559** in cash balances at financial institutions exceeded the federally insured limit of $250,000[17](index=17&type=chunk) [Stock-based Compensation](index=9&type=section&id=Stock-based%20Compensation) Explains the accounting treatment for employee and non-employee share-based compensation - Employee and non-employee share-based compensation is measured at the grant date fair value and recognized as an expense over the requisite service period[17](index=17&type=chunk) [Restricted Stock Units (RSUs)](index=9&type=section&id=Restricted%20Stock%20Units%20%28%22RSUs%22%29) Details the vesting schedule and fair value measurement for Restricted Stock Units - RSUs vest over **four years** from the date of grant[17](index=17&type=chunk) - The fair value of RSUs is the market price of the common stock at the date of grant[17](index=17&type=chunk) [Performance Units (PUs)](index=9&type=section&id=Performance%20Units%20%28%22PUs%22%29) Describes the vesting conditions for Performance Units, tied to share price targets and clinical data - PUs vest based on performance against predefined share price targets and the achievement of Positive Interim, Clinical Data as defined by the Board[18](index=18&type=chunk) [Loss Per Common Share](index=9&type=section&id=Loss%20Per%20Common%20Share) Explains the calculation of basic and diluted loss per common share and lists potentially dilutive securities - Basic loss per common share is computed by dividing net loss by the weighted-average number of common shares outstanding[19](index=19&type=chunk) - Diluted loss per common share excludes common stock equivalents in periods of loss because their inclusion would be anti-dilutive[19](index=19&type=chunk) **Potentially Dilutive Shares (not included in EPS calculation):** | Item | June 30, 2024 | June 30, 2023 | | :--- | :--- | :--- | | Warrants to purchase common shares | 1,551,422 | 45,399 | | Unvested restricted stock units | 5,475 | 193 | | Unvested performance units | 577 | 577 | | Options for common shares | 12,177 | 2,591 | [Note 3 – Note Payable](index=9&type=section&id=Note%203%20%E2%80%93%20Note%20Payable) The company entered into a short-term note payable of $329,571 on November 28, 2023, at 9.74% interest, for financing insurance policies. The note is to be repaid over 11 months, with the final payment due October 8, 2024. As of June 30, 2024, the outstanding balance was $123,248 - On November 28, 2023, the Company entered into a short-term note payable for **$329,571**, bearing interest at **9.74%** per year, to finance insurance policies[20](index=20&type=chunk) - The note is to be repaid over an **11-month period**, with the final payment due on October 8, 2024[20](index=20&type=chunk) - As of June 30, 2024, the Company's note payable balance was **$123,248**[20](index=20&type=chunk) [Note 4 – Equity](index=9&type=section&id=Note%204%20%E2%80%93%20Equity) This note details changes in the company's equity structure, including authorized shares, reverse stock splits, and activity related to common stock, stock options, stock warrants, restricted stock units (RSUs), and performance units (PUs). Significant events include an increase in authorized common stock to 300,000,000 shares, a 1-for-50 reverse stock split in June 2024, and various equity offerings and grants of stock-based compensation [Common Stock](index=9&type=section&id=Common%20Stock) Details changes in authorized common stock, reverse stock splits, and proceeds from equity offerings - On May 2, 2024, authorized common stock increased from **75,000,000 shares to 300,000,000 shares**[21](index=21&type=chunk) - A **one-for-fifty (1:50) reverse stock split** became effective on June 4, 2024[25](index=25&type=chunk) - In January 2024, a public offering of common stock and warrants generated net proceeds of **$3,331,000**[26](index=26&type=chunk) - In June 2024, a registered direct offering and private placement generated net proceeds of **$1,203,259**[28](index=28&type=chunk) - In late June 2024, another registered direct offering and private placement generated net proceeds of **$1,221,154**[31](index=31&type=chunk) [Stock Options](index=11&type=section&id=Stock%20Options) Describes amendments to the equity plan, stock-based compensation, and activity related to stock options - The 2020 Equity Plan was amended on April 30, 2024, increasing authorized shares for issuance by **70,000 to a total of 86,916 shares**[25](index=25&type=chunk) - During the six months ended June 30, 2024, the Company recognized **$412,749** of stock-based compensation related to options, with **$366,400** of unrecognized expenses remaining[34](index=34&type=chunk) **Stock Option Activity (Six Months Ended June 30, 2024):** | Metric | Options | Exercise Price Per Share | | :--- | :--- | :--- | | Outstanding, December 31, 2023 | 6,598 | $1,020.47 | | Granted | 5,579 | $12.92 | | Exercised | – | – | | Forfeited | – | – | | Expired | – | – | | Outstanding, June 30, 2024 | 12,177 | $558.85 | | Exercisable, June 30, 2024 | 2,495 | $2,355.92 | [Stock Warrants](index=12&type=section&id=Stock%20Warrants) Outlines amendments to existing warrants, proceeds from exercises, and warrant activity - Existing warrants to purchase **75,120 shares** were amended to reduce the exercise price from **$64.00 to $15.00** and extend the termination date to February 1, 2029[38](index=38&type=chunk) - During the six months ended June 30, 2024, the Company received **$21,326** from the exercise of **253,034 warrants**[38](index=38&type=chunk) **Stock Warrant Activity (Six Months Ended June 30, 2024):** | Metric | Warrants | Weighted-Average Exercise Price Per Share | | :--- | :--- | :--- | | Outstanding, December 31, 2023 | 84,832 | $151.65 | | Granted | 1,719,694 | $8.12 | | Exercised | (253,034) | $13.18 | | Forfeited | – | – | | Expired | (70) | $2,635.71 | | Outstanding, June 30, 2024 | 1,551,422 | $15.03 | | Exercisable, June 30, 2024 | 1,551,422 | $15.03 | [Restricted Stock Units](index=12&type=section&id=Restricted%20Stock%20Units) Reports on RSU grants, recognized compensation expense, and non-vested RSU activity - On April 7, 2024, **5,330 RSUs** were granted to officers, employees, and board members, valued at **$69,027**[39](index=39&type=chunk) - During the six months ended June 30, 2024, **$19,566** of stock-based compensation related to RSUs was recognized, with **$103,123** of unrecognized expenses remaining[39](index=39&type=chunk) **RSU Activity (Six Months Ended June 30, 2024):** | Metric | RSUs | Weighted-Average Grant Date Fair Value | | :--- | :--- | :--- | | Non-vested, December 31, 2023 | 145 | $501.00 | | Granted | 5,330 | $12.97 | | Vested | – | – | | Forfeited | – | – | | Non-vested, June 30, 2024 | 5,475 | $25.89 | [Performance Units](index=13&type=section&id=Performance%20Units) Explains vesting conditions, fair value estimation, and recognized compensation for Performance Units - PUs granted in 2022 vest based on share price targets (**$3,000, $6,000**) and achievement of 'Positive Interim, Clinical Data'[40](index=40&type=chunk) - The fair value of performance units with market conditions is estimated using a Monte Carlo simulation[41](index=41&type=chunk) - During the six months ended June 30, 2024, **$4,963** was recognized related to outstanding PUs, with **$95,399** of unrecognized expenses remaining[41](index=41&type=chunk) **PU Activity (Six Months Ended June 30, 2024):** | Metric | PUs | Weighted-Average Grant Date Fair Value | | :--- | :--- | :--- | | Non-vested, December 31, 2023 | 577 | $296.82 | | Granted | – | – | | Vested | – | – | | Forfeited | – | – | | Non-vested, June 30, 2024 | 577 | $296.82 | [Note 5 – Commitments and Contingencies](index=14&type=section&id=Note%205%20%E2%80%93%20Commitments%20and%20Contingencies) This note outlines the company's various contractual commitments and potential liabilities, including executive employment agreements, Scientific Advisory Board compensation, and intellectual property agreements for its drug candidates Berubicin (WP744 Portfolio) and WP1244 Portfolio. It also addresses the company's Nasdaq listing qualifications status [Executive Employment Agreements](index=14&type=section&id=Executive%20Employment%20Agreements) Details CEO employment terms, severance benefits, and approved cash bonuses for officers - CEO John Climaco's employment agreement provides for annual extensions and severance benefits of **twelve months of base salary** upon termination without cause[45](index=45&type=chunk) - Mr. Climaco's 2021 annual base salary was set at **$525,000**[45](index=45&type=chunk) - In March 2024, cash bonuses totaling **$240,608** were approved for officers, payable upon completion of sufficient financing[46](index=46&type=chunk) [Scientific Advisory Board](index=14&type=section&id=Scientific%20Advisory%20Board) Reports the termination of the cash compensation program and accrued compensation for a board member - The cash compensation program for the Scientific Advisory Board was terminated on March 14, 2024[47](index=47&type=chunk) - As of June 30, 2024, the Company accrued **$177,309** related to Mr. Hsu's Scientific Advisory Board compensation[47](index=47&type=chunk) [WP744 Portfolio (Berubicin)](index=15&type=section&id=WP744%20Portfolio%20%28Berubicin%29) Covers agreements for Berubicin, including royalties, license termination notice, and FDA designations - The Company purchased all rights to Berubicin from Reata Pharmaceuticals, Inc. in 2017, agreeing to pay a **2.25% royalty** on net sales for **10 years**[49](index=49&type=chunk) - The Company obtained a worldwide exclusive license to WP744 from Houston Pharmaceuticals, Inc. (HPI) in 2017, with royalties, milestone payments, and development fees[50](index=50&type=chunk) - On May 14, 2024, the Company provided notice to HPI of its intent to terminate the HPI License effective on or about July 14, 2024[50](index=50&type=chunk) - FDA granted Orphan Drug Designation (ODD) for Berubicin for malignant gliomas on June 10, 2020, potentially enabling **7 years of market exclusivity**[54](index=54&type=chunk) - FDA granted Fast Track Designation for Berubicin on July 24, 2021[55](index=55&type=chunk) [WP1244 Portfolio](index=16&type=section&id=WP1244%20Portfolio) Discusses the license agreement for WP1244, its termination due to unmet milestones and unpaid fees - The Company obtained a royalty-bearing, worldwide, exclusive license to WP1244 drug technology from UTMDACC in January 2020[56](index=56&type=chunk) - On April 25, 2024, UTMDACC provided notice of intent to terminate the WP1244 Agreement due to unmet commercial diligence milestones and unpaid annual maintenance fees[56](index=56&type=chunk) - The WP1244 Agreement was terminated on May 25, 2024, with no termination penalty provisions[56](index=56&type=chunk) [Nasdaq Capital Markets Listing Qualifications](index=16&type=section&id=Nasdaq%20Capital%20Markets%20Listing%20Qualifications) Addresses non-compliance with Nasdaq's equity and bid price rules and subsequent compliance efforts - On August 17, 2023, the Company was notified of non-compliance with Nasdaq's minimum **$2,500,000 stockholders' equity requirement**[57](index=57&type=chunk) - On February 27, 2024, the Company was notified of non-compliance with Nasdaq's **$1.00 minimum bid price requirement**[57](index=57&type=chunk) - The Nasdaq Hearings Panel granted an extension until **August 12, 2024**, to demonstrate compliance with both listing rules[58](index=58&type=chunk) - On July 5, 2024, the Company regained compliance with the Bid Price Rule[60](index=60&type=chunk) - On August 7, 2024, the Company filed an 8-K indicating shareholders' equity was above the **$2.5 million requirement**[60](index=60&type=chunk) [Note 6 – Subsequent Events](index=17&type=section&id=Note%206%20%E2%80%93%20Subsequent%20Events) This note details significant events that occurred after the reporting period but before the filing of the 10-Q, including further equity offerings and a new exclusive license agreement for the TPI 287 compound - On July 3, 2024, the Company completed a registered direct offering and private placement, generating approximately **$1.98 million in gross proceeds**[62](index=62&type=chunk) - On July 26, 2024, the Company entered into an ATM Sales Agreement, increasing the aggregate sales price of common shares that may be sold to **$25.0 million**[63](index=63&type=chunk) - As of August 14, 2024, the Company sold **28,704,761 shares** under the ATM agreement for net proceeds of approximately **$10.5 million**[63](index=63&type=chunk) - On July 29, 2024, the Company entered into an exclusive license agreement with Cortice Biosciences, Inc. for TPI 287 intellectual property rights in the United States, Canada, Mexico, and Japan[64](index=64&type=chunk) - The Cortice Agreements involve issuing **573,368 shares** upon closing, **43,330 shares** upon shareholder approval, and potential milestone payments (up to **$90 million or 2,472,357 shares**) and royalties (**3.0%-7.5%**)[65](index=65&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=18&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, liquidity, and capital resources, including an overview of operations, results analysis, and critical accounting policies [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=18&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) Warns that forward-looking statements are subject to risks and uncertainties, and actual results may differ materially - Forward-looking statements are subject to known and unknown risks, uncertainties, and assumptions, and actual results may differ materially[67](index=67&type=chunk) - Key forward-looking statements include the ability to maintain Nasdaq listing, obtain additional funding, achieve regulatory approval, and commercialize product candidates[69](index=69&type=chunk) - Investors are cautioned not to place undue reliance on these statements, which speak only as of the date of this Form 10-Q[71](index=71&type=chunk) [Overview](index=19&type=section&id=Overview) Provides a general description of CNS Pharmaceuticals, its lead drug candidate Berubicin, its clinical trial status, and FDA designations - CNS Pharmaceuticals is a clinical pharmaceutical company focused on developing anti-cancer drug candidates for brain and central nervous system tumors[73](index=73&type=chunk) - Berubicin, the lead drug candidate, is an anthracycline believed to cross the blood-brain barrier and is currently in a potentially pivotal Phase II clinical trial for Glioblastoma Multiforme[75](index=75&type=chunk)[76](index=76&type=chunk) - The Phase II trial compares Berubicin to Lomustine, with a **2:1 randomization of 252 patients**; an independent Data Safety Monitoring Board (DSMB) recommended continuing the study without modification after an interim futility analysis[77](index=77&type=chunk) - Berubicin has received Orphan Drug Designation (ODD) and Fast Track Designation from the FDA[81](index=81&type=chunk)[55](index=55&type=chunk) - The WP1244 Agreement with UTMDACC was terminated on May 25, 2024, due to unmet commercial diligence milestones and unpaid annual maintenance fees[83](index=83&type=chunk) [Results of Operations (Three Months Ended June 30, 2024 vs. 2023)](index=21&type=section&id=Results%20of%20Operations%20for%20the%20Three%20Months%20Ended%20June%2030%2C%202024%20Compared%20to%20the%20Three%20Months%20Ended%20June%2030%2C%202023) Compares the company's financial performance for the three months ended June 30, 2024, against the same period in 2023 [General and Administrative Expense](index=21&type=section&id=General%20and%20Administrative%20Expense) Analyzes changes in general and administrative expenses for the three-month period **General and Administrative Expense (Three Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $1,412,000 | | June 30, 2023 | $1,180,000 | | **Change** | **+$232,000** | - The increase was mainly attributable to approximately **$333,000 in legal and professional expenses**, offset by decreases in marketing, advertising, and other expenses[84](index=84&type=chunk) [Research and Development Expense](index=21&type=section&id=Research%20and%20Development%20Expense) Examines the decrease in research and development expenses, primarily due to CRO costs **Research and Development Expense (Three Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $1,117,000 | | June 30, 2023 | $2,846,000 | | **Change** | **-$1,729,000** | - The decrease was mainly attributed to the timing of Contract Research Organization (CRO) expenses related to the continued progress of the Phase II clinical trial of Berubicin, with expenditures expected to continue declining[85](index=85&type=chunk) [Net Loss](index=21&type=section&id=Net%20Loss) Discusses the reduction in net loss, attributed to lower CRO and legal/professional fees **Net Loss (Three Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $(2,531,000) | | June 30, 2023 | $(4,021,000) | | **Change** | **+$1,490,000 (reduction in loss)** | - The reduction in net loss is attributable to a decrease in CRO expenses related to the Berubicin clinical trial and decreases in legal and professional fees[86](index=86&type=chunk) [Results of Operations (Six Months Ended June 30, 2024 vs. 2023)](index=22&type=section&id=Results%20of%20Operations%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202024%20Compared%20to%20the%20Six%20Months%20Ended%20June%2030%2C%202023) Compares the company's financial performance for the six months ended June 30, 2024, against the same period in 2023 [General and Administrative Expense](index=22&type=section&id=General%20and%20Administrative%20Expense) Analyzes the slight decrease in general and administrative expenses for the six-month period **General and Administrative Expense (Six Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $2,526,000 | | June 30, 2023 | $2,539,000 | | **Change** | **-$13,000** | - The slight decrease was mainly attributable to increases in legal and professional expenses, offset by decreases in stock-based compensation, marketing, advertising, and insurance expense[88](index=88&type=chunk) [Research and Development Expense](index=22&type=section&id=Research%20and%20Development%20Expense) Examines the decrease in research and development expenses over the six-month period **Research and Development Expense (Six Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $3,547,000 | | June 30, 2023 | $6,413,000 | | **Change** | **-$2,866,000** | - The decrease was mainly attributed to the timing of CRO expenses related to the continued progress of the Phase II clinical trial, with expenditures expected to continue declining[88](index=88&type=chunk) [Net Loss](index=22&type=section&id=Net%20Loss) Discusses the reduction in net loss for the six-month period, driven by lower CRO and legal fees **Net Loss (Six Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $(6,076,000) | | June 30, 2023 | $(8,953,000) | | **Change** | **+$2,877,000 (reduction in loss)** | - The reduction in net loss is attributable to a decrease in CRO expenses related to the Berubicin clinical trial and decreases in legal and professional fees[89](index=89&type=chunk) [Liquidity and Capital Resources](index=22&type=section&id=Liquidity%20and%20Capital%20Resources) Assesses the company's cash position, working capital, funding sources, and future capital needs **Liquidity Snapshot (June 30, 2024):** | Metric | Amount | | :--- | :--- | | Cash | $1,492,000 | | Working Capital Deficit | $(4,617,000) | - The Company funds its operations from proceeds from equity sales[90](index=90&type=chunk) - Current cash on hand is expected to fund operations through the **first quarter of 2025**[95](index=95&type=chunk) - Additional capital is needed in the near term to continue to meet Nasdaq minimum equity requirements and potentially fund TPI 287 clinical preparations[96](index=96&type=chunk)[95](index=95&type=chunk) - Failure to raise sufficient funds could lead to Nasdaq delisting or cessation of operations[96](index=96&type=chunk) [Summary of Cash Flows](index=23&type=section&id=Summary%20of%20Cash%20Flows) Provides an overview of cash flows from operating and financing activities for the six-month periods [Cash used in operating activities](index=23&type=section&id=Cash%20used%20in%20operating%20activities) Details the primary expenditures contributing to cash used in operating activities **Net Cash Used in Operating Activities (Six Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $(4,842,000) | | June 30, 2023 | $(8,227,000) | | **Change** | **+$3,385,000 (reduction in cash used)** | - Primarily included payments for clinical trial preparation, officer compensation, insurance, marketing, and professional fees[97](index=97&type=chunk) [Cash provided by financing activities](index=23&type=section&id=Cash%20provided%20by%20financing%20activities) Explains the sources of cash from financing activities, mainly equity sales **Net Cash Provided by Financing Activities (Six Months Ended June 30):** | Period | Amount | | :--- | :--- | | June 30, 2024 | $5,785,000 | | June 30, 2023 | $2,451,000 | | **Change** | **+$3,334,000** | - Primarily from the sale of common stock and exercise of warrants, offset by repayment of notes payable and payment of deferred offering costs[97](index=97&type=chunk) [Off-balance Sheet Arrangements](index=24&type=section&id=Off-balance%20Sheet%20Arrangements) States that the company has no material off-balance sheet arrangements as of June 30, 2024 - As of June 30, 2024, the Company did not have any relationships with unconsolidated entities or financial partnerships for off-balance sheet arrangements[99](index=99&type=chunk) [Purchase Commitments](index=24&type=section&id=Purchase%20Commitments) Notes the absence of material capital expenditure commitments, but highlights milestone fee obligations - The Company does not have any material commitments for capital expenditures, but is required to pay certain milestone fees to HPI, Reata, and Cortice[100](index=100&type=chunk) [JOBS Act Accounting Election](index=24&type=section&id=JOBS%20Act%20Accounting%20Election) Explains the company's election to use the extended transition period for new accounting standards - As an 'emerging growth company,' the Company elected not to opt out of the extended transition period for new or revised financial accounting standards[101](index=101&type=chunk) - This election allows the Company to adopt new standards at the same time as private companies, which may make financial statement comparisons difficult[101](index=101&type=chunk) [Critical Accounting Policies and Estimates](index=24&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) States that management identified no critical accounting estimates for the period - Management determined there were no critical accounting estimates[102](index=102&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, CNS Pharmaceuticals, Inc. is not required to provide quantitative and qualitative disclosures about market risk - The Company is a smaller reporting company and is not required to provide the information required under this item[103](index=103&type=chunk) [Item 4. Controls and Procedures](index=24&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were ineffective as of June 30, 2024, due to material weaknesses, with remediation efforts underway [Evaluation of Disclosure Controls and Procedures and Changes in Internal Control over Financial Reporting](index=24&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures%20and%20Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) Details the ineffectiveness of disclosure controls and material weaknesses identified as of June 30, 2024 - As of June 30, 2024, disclosure controls and procedures were concluded to be **ineffective**[107](index=107&type=chunk) - Material weaknesses include lack of segregation of duties, limited access to timely and complete information regarding CRO costs, and lack of formal documentation of the control environment[107](index=107&type=chunk) - Management is commencing actions to address the lack of formal documentation and working with the CRO to improve data timeliness and completeness[107](index=107&type=chunk) - Despite material weaknesses, management believes the financial statements fairly present the Company's financial condition, results of operations, and cash flows[108](index=108&type=chunk) [PART II OTHER INFORMATION](index=25&type=section&id=PART%20II%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity sales, defaults, other information, and exhibits [Item 1. Legal Proceedings](index=25&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently involved in any material legal proceedings. While litigation outcomes are unpredictable and can be costly, the company maintains insurance policies for potential losses where cost-effective - The Company is not currently involved in any legal proceedings[110](index=110&type=chunk) - The results of litigation are inherently unpredictable and can be time-consuming and costly[110](index=110&type=chunk) [Item 1A. Risk Factors](index=26&type=section&id=Item%201A.%20Risk%20Factors) This section incorporates by reference the risk factors from the company's 2023 Annual Report on Form 10-K and highlights the critical risk of maintaining compliance with Nasdaq listing requirements. The company recently regained compliance with the bid price rule and reported sufficient shareholders' equity, but delisting remains a significant concern if compliance is not sustained - Risk factors from the 2023 Annual Report on Form 10-K are incorporated by reference[111](index=111&type=chunk) - Inability to maintain compliance with Nasdaq Capital Market listing requirements could have a material adverse effect[111](index=111&type=chunk) - The Company regained compliance with the Nasdaq Bid Price Rule on **July 5, 2024**[114](index=114&type=chunk) - On August 7, 2024, the Company filed an 8-K indicating shareholders' equity was above the **$2.5 million requirement**[116](index=116&type=chunk) - Delisting would adversely affect the ability to raise financing, trade securities, and negatively impact value and liquidity[116](index=116&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=27&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company has not issued any unregistered securities during the quarter ended June 30, 2024, except as previously disclosed on Form 8-K - Except as previously disclosed on Form 8-K, no unregistered securities were issued during the quarter ended June 30, 2024[117](index=117&type=chunk) [Item 3. Defaults Upon Senior Securities](index=27&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities during the period - No defaults upon senior securities were reported[117](index=117&type=chunk) [Item 4. Mine Safety Disclosures](index=27&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - This item is not applicable to the Company[117](index=117&type=chunk) [Item 5. Other Information](index=27&type=section&id=Item%205.%20Other%20Information) During the reporting period, none of the company's directors or executive officers adopted or terminated any Rule 10b5-1 or non-Rule 10b5-1 trading arrangements - None of the Company's directors or executive officers adopted or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the period[118](index=118&type=chunk) [Item 6. Exhibits](index=27&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including amendments to articles of incorporation, forms of warrants, financial advisory agreements, securities purchase agreements, the amended 2020 Equity Plan, and certifications - Exhibits include Certificate of Amendment to Articles of Incorporation, forms of Common and Pre-Funded Warrants, Financial Advisory Agreements, Securities Purchase Agreements, and the 2020 Equity Plan[118](index=118&type=chunk)[121](index=121&type=chunk) - Also includes Inline XBRL Instance Document, Taxonomy Extension Schema, Calculation, Definition, Label, and Presentation Linkbase Documents, and Cover Page Interactive Data File[119](index=119&type=chunk) - Certifications of the Principal Executive Officer and Principal Financial Officer are included pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350[121](index=121&type=chunk) [Signatures](index=29&type=section&id=Signatures) Confirms the report's authorization by the Chief Executive Officer and Chief Financial Officer - The report was signed by John Climaco, Chief Executive Officer and Director, and Christopher Downs, Chief Financial Officer, on **August 14, 2024**[123](index=123&type=chunk)

[Form 8-K Filing Details](index=1&type=section&id=Form%208-K%20Filing%20Details) This section provides essential information regarding the Form 8-K filing, including registrant details and report date [Registrant and Filing Information](index=1&type=section&id=Registrant%20and%20Filing%20Information) This section identifies CNS Pharmaceuticals, Inc. as the registrant, details its incorporation state (Nevada), and confirms its status as an emerging growth company. The report date is May 16, 2024 - Registrant: **CNS Pharmaceuticals, Inc.**[1](index=1&type=chunk) - Incorporation State: **Nevada**[1](index=1&type=chunk) - Emerging Growth Company: **Yes**[3](index=3&type=chunk) - Date of Report (earliest event reported): **May 16, 2024**[1](index=1&type=chunk) [Securities Registration](index=1&type=section&id=Securities%20Registration) The company's common stock is registered on The NASDAQ Stock Market LLC under the trading symbol CNSP Securities Registered Pursuant to Section 12(b) of the Act | Title of each class | Trading Symbols(s) | Name of each exchange on which registered | | :------------------ | :----------------- | :---------------------------------------- | | Common stock, par value $0.001 per share | CNSP | The NASDAQ Stock Market LLC | [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02.%20Results%20of%20Operations%20and%20Financial%20Condition.) This section details the announcement of the company's financial results and operational highlights for the first quarter [Announcement of Financial Results](index=2&type=section&id=Announcement%20of%20Financial%20Results) CNS Pharmaceuticals, Inc. issued a press release on May 16, 2024, announcing its financial results for the first quarter ended March 31, 2024, along with recent operational highlights. This press release is incorporated by reference as Exhibit 99.1 - Company issued a press release on **May 16, 2024**[5](index=5&type=chunk) - The press release announced financial results for **Q1 ended March 31, 2024**, and recent operational highlights[5](index=5&type=chunk) - The press release is attached as **Exhibit 99.1** and incorporated by reference[5](index=5&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01.%20Financial%20Statements%20and%20Exhibits) This section lists all financial statements and exhibits filed as part of the Form 8-K report [Exhibits Filed](index=2&type=section&id=Exhibits%20Filed) This section lists the exhibits filed with the Form 8-K, including the press release (Exhibit 99.1) detailing Q1 2024 results and the Cover page Interactive Data File (Exhibit 104) List of Exhibits | Exhibit No. | Exhibit Description | | :---------- | :---------------------------------------------------------- | | 99.1 | Press release dated May 16, 2024 | | 104 | Cover page Interactive Data File (embedded within the Inline XBRL document) | [Signature](index=3&type=section&id=Signature) This section confirms the official signing and submission of the Form 8-K report [Report Signatory](index=3&type=section&id=Report%20Signatory) The report was duly signed on behalf of CNS Pharmaceuticals, Inc. by Chris Downs, Chief Financial Officer, on May 16, 2024 - Report signed by **Chris Downs, Chief Financial Officer**[10](index=10&type=chunk) - Signature Date: **May 16, 2024**[10](index=10&type=chunk)

[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents CNS Pharmaceuticals, Inc.'s unaudited financial statements and related disclosures [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents CNS Pharmaceuticals, Inc.'s unaudited financial statements, including balance sheets, operations, equity, cash flows, and notes [Balance Sheets](index=3&type=section&id=Balance%20Sheets%20as%20of%20March%2031%2C%202024%20and%20December%2031%2C%202023%20%28unaudited%29) This section provides the unaudited balance sheets as of March 31, 2024, and December 31, 2023 | Metric (USD) | March 31, 2024 | December 31, 2023 | | :-------------------------- | :------------- | :---------------- | | Cash and cash equivalents | $815,226 | $548,721 | | Total current assets | $1,601,276 | $1,591,170 | | Total Assets | $1,660,877 | $1,700,853 | | Total current liabilities | $6,091,402 | $6,132,968 | | Total Liabilities | $6,091,402 | $6,132,968 | | Total Stockholders' Equity | $(4,430,525) | $(4,432,115) | [Statements of Operations](index=4&type=section&id=Statements%20of%20Operations%20for%20the%20three%20months%20ended%20March%2031%2C%202024%20and%202023%20%28unaudited%29) This section presents the unaudited statements of operations for the three months ended March 31, 2024, and 2023 | Metric | Three Months Ended March 31, 2024 (USD) | Three Months Ended March 31, 2023 (USD) | | :------------------------------ | :-------------------------------------- | :-------------------------------------- | | General and administrative | $1,114,442 | $1,358,752 | | Research and development | $2,430,412 | $3,567,759 | | Total operating expenses | $3,544,854 | $4,926,511 | | Net loss | $(3,544,748) | $(4,931,947) | | Loss per share - basic | $(0.41) | $(2.59) | | Loss per share - diluted | $(0.41) | $(2.59) | | Weighted average shares outstanding - basic (count) | 8,712,680 | 1,906,494 | | Weighted average shares outstanding - diluted (count) | 8,712,680 | 1,906,494 | [Statements of Stockholders' Equity (Deficit)](index=5&type=section&id=Statements%20of%20Stockholders'%20Equity%20%28Deficit%29%20for%20the%20three%20months%20ended%20March%2031%2C%202024%20and%202023%20%28unaudited%29) This section details the unaudited statements of stockholders' equity (deficit) for the three months ended March 31, 2024, and 2023 | Metric | Balance Dec 31, 2023 (USD) | Common Stock Issued for Cash, Net (USD) | Exercise of Warrants, Net (USD) | Stock-based Compensation (USD) | Net Loss (USD) | Balance Mar 31, 2024 (USD) | | :----------------------------------- | :------------------------- | :-------------------------------------- | :------------------------------ | :----------------------------- | :------------- | :------------------------- | | Common Shares (count) | 6,214,598 | 2,215,667 | 2,238,667 | – | – | 10,668,932 | | Stock (USD) | 6,214 | 2,216 | 2,239 | – | – | 10,669 | | Additional Paid-in Capital (USD) | 65,128,574 | 3,328,784 | 10,166 | 202,933 | – | 68,670,457 | | Accumulated Deficit (USD) | (69,566,903) | – | – | – | (3,544,748) | (73,111,651) | | Total Stockholders' Equity (Deficit) | (4,432,115) | 3,331,000 | 12,405 | 202,933 | (3,544,748) | (4,430,525) | [Statements of Cash Flows](index=6&type=section&id=Statements%20of%20Cash%20Flows%20for%20the%20three%20months%20ended%20March%2031%2C%202024%20and%202023%20%28unaudited%29) This section presents the unaudited statements of cash flows for the three months ended March 31, 2024, and 2023 | Metric | Three Months Ended March 31, 2024 (USD) | Three Months Ended March 31, 2023 (USD) | | :---------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Net loss | $(3,544,748) | $(4,931,947) | | Stock-based compensation | $202,933 | $290,313 | | Net cash used in operating activities | $(3,192,057) | $(4,824,592) | | Payments on notes payable | $(87,702) | $(120,893) | | Proceeds from exercise of warrants | $12,405 | $609 | | Proceeds from sale of common stock | $3,533,859 | – | | Net cash provided by (used in) financing activities | $3,458,562 | $(120,284) | | Net change in cash and cash equivalents | $266,505 | $(4,944,876) | | Cash and cash equivalents, at end of period | $815,226 | $5,110,531 | [Notes to the Financial Statements](index=7&type=section&id=Notes%20to%20the%20Financial%20Statements%20%28unaudited%29) This section provides detailed notes explaining the significant accounting policies, equity changes, commitments, contingencies, and subsequent events impacting the financial statements [Note 1 – Nature of Business](index=7&type=section&id=Note%201%20%E2%80%93%20Nature%20of%20Business) This note describes CNS Pharmaceuticals, Inc.'s core business as a clinical pharmaceutical company focused on anti-cancer drug development - CNS Pharmaceuticals, Inc. is a clinical pharmaceutical company focused on developing anti-cancer drug candidates, organized in Nevada on July 27, 2017[146](index=146&type=chunk) [Note 2 – Summary of Significant Accounting Policies](index=7&type=section&id=Note%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note outlines the significant accounting policies, going concern considerations, and the impact of a reverse stock split on the financial statements - The financial statements are unaudited and prepared in accordance with U.S. GAAP for interim information, and should be read in conjunction with the Form 10-K for the period ended December 31, 2023[39](index=39&type=chunk) - The company's ability to continue as a going concern is dependent on obtaining additional equity financings, as it has a history of negative cash flows and net losses, with current cash sufficient only for the near term[147](index=147&type=chunk) - A **1-for-30 reverse stock split** became effective on November 28, 2022, retroactively adjusted in the financial statements[8](index=8&type=chunk)[150](index=150&type=chunk) - As of March 31, 2024, **$565,226** of cash balances at financial institutions exceeded the federally insured limit of **$250,000**[9](index=9&type=chunk) [Note 3 – Note Payable](index=8&type=section&id=Note%203%20%E2%80%93%20Note%20Payable) This note details the company's note payable balance, interest rate, and final payment due date as of March 31, 2024 - As of March 31, 2024, the company had a note payable balance of **$213,104**, bearing interest at **9.74%** per year, with the final payment due on October 8, 2024[149](index=149&type=chunk) [Note 4 – Equity](index=8&type=section&id=Note%204%20%E2%80%93%20Equity) This note provides information on changes in authorized common stock, stock option and warrant activity, and stock-based compensation recognized during the period - On May 2, 2024, the company increased its authorized common stock from **75,000,000 shares** to **300,000,000 shares**[120](index=120&type=chunk) Stock Option Activity (Three Months Ended March 31, 2024) | Metric | Options (count) | Weighted Average Exercise Price Per Share (USD) | | :----------------------------------- | :-------------- | :---------------------------------------------- | | Outstanding, December 31, 2023 | 328,770 | $20.35 | | Granted | 12,420 | $0.25 | | Outstanding, March 31, 2024 | 341,190 | $19.62 | | Exercisable, March 31, 2024 | 99,920 | $58.39 | - The company recognized **$192,375** in stock-based compensation related to outstanding stock options for the three months ended March 31, 2024[152](index=152&type=chunk) Stock Warrant Activity (Three Months Ended March 31, 2024) | Metric | Warrants (count) | Weighted Average Exercise Per Share (USD) | | :----------------------------------- | :--------------- | :---------------------------------------- | | Outstanding, December 31, 2023 | 4,240,063 | $3.88 | | Granted | 37,784,335 | $0.30 | | Exercised | (2,238,667) | $0.30 | | Outstanding, March 31, 2024 | 39,785,731 | $0.59 | | Exercisable, March 31, 2024 | 39,785,731 | $0.59 | - On January 29, 2024, the company entered into a warrant amendment agreement to reduce the exercise price of certain existing warrants to **$0.30 per share**, subject to shareholder approval[16](index=16&type=chunk) - For the three months ended March 31, 2024, the company recognized **$5,962** of stock-based compensation related to outstanding RSUs and **$4,596** related to outstanding PUs[18](index=18&type=chunk)[50](index=50&type=chunk) [Note 5 – Commitments and Contingencies](index=12&type=section&id=Note%205%20%E2%80%93%20Commitments%20and%20Contingencies) This note outlines the company's financial commitments, including approved bonuses, accrued compensation, and potential license terminations - The Board approved cash bonuses totaling **$240,608** for officers, payable upon completion of a sufficient financing round[52](index=52&type=chunk) - The cash compensation program for the Scientific Advisory Board was terminated on March 14, 2024, with **$185,884** accrued for Mr. Hsu's compensation[22](index=22&type=chunk) - The company provided notice on May 14, 2024, to Houston Pharmaceuticals, Inc. (HPI) of its intent to terminate the HPI License for WP744 (Berubicin) effective July 14, 2024, as the patents under the license expired in March 2020[23](index=23&type=chunk)[169](index=169&type=chunk)[184](index=184&type=chunk) - The University of Texas M. D. Anderson Cancer Center (UTMDACC) notified the company on April 25, 2024, of its intent to terminate the WP1244 Agreement if the annual maintenance fee of **$50,000** plus **$1,300** in expenses are not paid, as the company has not met commercial diligence milestones[25](index=25&type=chunk)[63](index=63&type=chunk)[75](index=75&type=chunk) [Note 6 – Subsequent Events](index=15&type=section&id=Note%206%20%E2%80%93%20Subsequent%20Events) This note describes significant events occurring after March 31, 2024, including warrant exercises, equity plan approvals, and Nasdaq listing compliance extensions - Subsequent to March 31, 2024, **1,183,000 warrants** were exercised by investors at an exercise price of **$0.001 per share**[80](index=80&type=chunk) - On April 30, 2024, stockholders approved an increase of **3,500,000 shares** for issuance under the 2020 Equity Plan, bringing the total to **4,345,800 shares**[164](index=164&type=chunk) - On April 7, 2024, equity grants for 2023 service were approved, totaling **179,000 Options** (vesting over 3 years) and **179,000 Restricted Stock Units** (vesting over 2 years)[57](index=57&type=chunk) - The Nasdaq Hearings Panel granted an extension until **July 15, 2024**, for the company to demonstrate compliance with listing rules 5550(a)(2) and 5550(b)[26](index=26&type=chunk)[181](index=181&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management's discussion and analysis covers financial condition, operations, liquidity, capital resources, and forward-looking statements [Cautionary Note Regarding Forward-Looking Statements](index=16&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This note advises readers that the report contains forward-looking statements subject to various risks and uncertainties, which may differ from actual results - The report contains forward-looking statements subject to known and unknown risks and uncertainties, including clinical trial success, regulatory approval, market acceptance, intellectual property protection, and the ability to obtain additional funding[16](index=16&type=chunk)[28](index=28&type=chunk)[29](index=29&type=chunk)[30](index=30&type=chunk)[58](index=58&type=chunk)[60](index=60&type=chunk)[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk)[136](index=136&type=chunk)[137](index=137&type=chunk)[165](index=165&type=chunk)[166](index=166&type=chunk)[167](index=167&type=chunk)[187](index=187&type=chunk) - Readers are cautioned not to place undue reliance on these statements, which speak only as of the filing date, and the company is under no duty to update them[83](index=83&type=chunk)[136](index=136&type=chunk)[167](index=167&type=chunk) [Overview](index=17&type=section&id=Overview) This section provides an overview of CNS Pharmaceuticals' business, focusing on its anti-cancer drug development and lead candidate, Berubicin - CNS Pharmaceuticals is a clinical pharmaceutical company focused on developing anti-cancer drug candidates for brain and central nervous system tumors, primarily based on licensed intellectual property[138](index=138&type=chunk)[146](index=146&type=chunk) - The lead drug candidate, Berubicin, is being evaluated in a Phase II clinical trial for Glioblastoma Multiforme, with an independent Data Safety Monitoring Board (DSMB) recommending continuation of the study without modification on December 18, 2023[31](index=31&type=chunk)[61](index=61&type=chunk)[84](index=84&type=chunk) - Berubicin has received **Orphan Drug Designation (ODD)** from the FDA on June 10, 2020, and **Fast Track Designation** on July 24, 2021, which may provide market exclusivity and expedited review[55](index=55&type=chunk)[85](index=85&type=chunk)[132](index=132&type=chunk) - The company does not have manufacturing facilities or a sales organization, relying on third parties for these activities[139](index=139&type=chunk) [Results of Operations](index=19&type=section&id=Results%20of%20Operations%20for%20the%20Three%20Months%20Ended%20March%2031%2C%202024%20Compared%20to%20the%20Three%20Months%20Ended%20March%2031%2C%202023) This section compares the company's operating expenses and net loss for the three months ended March 31, 2024, and 2023 Operating Expenses and Net Loss (Three Months Ended March 31) | Metric | 2024 (USD) | 2023 (USD) | Change (USD) | Change (%) | | :------------------------------ | :------------ | :------------ | :------------ | :--------- | | General and administrative | $1,114,442 | $1,358,752 | $(244,310) | -18.0% | | Research and development | $2,430,412 | $3,567,759 | $(1,137,347) | -31.9% | | Net loss | $(3,544,748) | $(4,931,947) | $1,387,199 | -28.1% | - The decrease in general and administrative expense was mainly due to reductions in legal and professional expenses, insurance, stock compensation, and travel expenses[64](index=64&type=chunk) - The decrease in research and development expenses was primarily attributed to the timing of Contract Research Organization (CRO) expenses related to the Phase II clinical trial[87](index=87&type=chunk) [Liquidity and Capital Resources](index=20&type=section&id=Liquidity%20and%20Capital%20Resources) This section assesses the company's cash position, working capital, and future capital requirements to sustain operations and clinical trials Cash Flow Summary (Three Months Ended March 31) | Metric | 2024 (USD) | 2023 (USD) | | :---------------------------------------- | :------------ | :------------ | | Net cash used in operating activities | $(3,192,057) | $(4,824,592) | | Net cash provided by (used in) financing activities | $3,458,562 | $(120,284) | | Cash and cash equivalents, at end of period | $815,226 | $5,110,531 | - As of March 31, 2024, the company had approximately **$815,000** in cash and a working capital deficit of approximately **$4,490,000**[191](index=191&type=chunk) - The company requires an additional **$13 to $15 million** to complete the Berubicin Phase 2 trial, plus **$4.5 to $5.0 million** annually for operations, and an extra **$5.0 million** for WP1244/WP1874 preclinical work[173](index=173&type=chunk) - Management believes current cash is sufficient only into the latter half of the second quarter of 2024, and significant additional capital is needed to avoid scaling back or ceasing operations[89](index=89&type=chunk)[173](index=173&type=chunk) [Critical Accounting Policies and Estimates](index=21&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section discusses management's determination regarding critical accounting estimates and the inherent judgments in financial statement preparation - Management determined there were no critical accounting estimates for the period, but notes that financial statements require judgments and estimates that could differ from actual results[69](index=69&type=chunk) [Off-balance Sheet Arrangements](index=21&type=section&id=Off-balance%20Sheet%20Arrangements) This section confirms the absence of off-balance sheet arrangements as of March 31, 2024 - As of March 31, 2024, the company did not have any relationships with unconsolidated entities or financial partnerships for off-balance sheet arrangements[91](index=91&type=chunk) [JOBS Act Accounting Election](index=21&type=section&id=JOBS%20Act%20Accounting%20Election) This section explains the company's election as an 'emerging growth company' to utilize the extended transition period for new accounting standards - The company, as an 'emerging growth company,' elected not to opt out of the extended transition period for complying with new or revised financial accounting standards, which may affect comparability with other public companies[92](index=92&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=21&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) As a smaller reporting company, CNS Pharmaceuticals, Inc. is not required to provide the information typically required under this item - The company is a smaller reporting company and is not required to provide quantitative and qualitative disclosures about market risk[93](index=93&type=chunk) [Item 4. Controls and Procedures](index=21&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were ineffective as of March 31, 2024, due to material weaknesses, and is implementing actions to address these issues [Evaluation of Disclosure Controls and Procedures and Changes in Internal Control over Financial Reporting](index=21&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures%20and%20Changes%20in%20Internal%20Control%20over%20Financial%20Reporting) This section details the ineffectiveness of disclosure controls and procedures due to material weaknesses and outlines management's remediation efforts - As of March 31, 2024, the company's disclosure controls and procedures were deemed **ineffective** due to material weaknesses in internal control over financial reporting[71](index=71&type=chunk)[197](index=197&type=chunk) - Material weaknesses include a lack of segregation of duties, limited access to timely and complete information from the third-party Contract Research Organization (CRO), and a lack of formal documentation of the control environment[71](index=71&type=chunk) - Management is taking actions to address these weaknesses, including formalizing documentation, working with the CRO for improved data timeliness and completeness, and conducting increased analytical analysis[71](index=71&type=chunk) - Additional experienced personnel will be hired in accounting and finance, and the accounting system will be upgraded when economically feasible[178](index=178&type=chunk) [PART II OTHER INFORMATION](index=23&type=section&id=PART%20II%20OTHER%20INFORMATION) This section includes legal proceedings, risk factors, equity sales, defaults, mine safety, other disclosures, exhibits, and signatures [Item 1. Legal Proceedings](index=23&type=section&id=Item%201.%20Legal%20Proceedings) CNS Pharmaceuticals, Inc. is not currently involved in any material legal proceedings - The company is not currently involved in any legal proceedings[199](index=199&type=chunk) [Item 1A. Risk Factors](index=23&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks related to its Nasdaq listing compliance, having received notifications of non-compliance with minimum stockholders' equity and bid price requirements, with a delisting risk if compliance is not met by July 15, 2024 - The company received notifications from Nasdaq for non-compliance with the minimum **$2,500,000** stockholders' equity requirement (August 17, 2023) and the **$1.00** minimum bid price requirement (February 27, 2024)[74](index=74&type=chunk)[163](index=163&type=chunk) - An extension has been granted until **July 15, 2024**, to demonstrate compliance with Nasdaq listing rules, but this plan requires significant, uncommitted financing[26](index=26&type=chunk)[181](index=181&type=chunk) - Failure to maintain Nasdaq listing compliance could result in delisting, adversely affecting the company's ability to raise financing, trade securities, and potentially impacting its value and liquidity[97](index=97&type=chunk)[98](index=98&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=24&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales of equity securities or use of proceeds to report for the period - None to report for unregistered sales of equity securities and use of proceeds[182](index=182&type=chunk) [Item 3. Defaults Upon Senior Securities](index=24&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no defaults upon senior securities to report for the period - None to report for defaults upon senior securities[202](index=202&type=chunk) [Item 4. Mine Safety Disclosures](index=24&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) Mine safety disclosures are not applicable to the company's operations - Mine safety disclosures are not applicable to the company[183](index=183&type=chunk) [Item 5. Other Information](index=24&type=section&id=Item%205.%20Other%20Information) The company provided notice to terminate its HPI License for Berubicin, believing it will not impact development due to expired patents, and reported no Rule 10b5-1 trading arrangements by directors or executive officers - On May 14, 2024, the company provided notice to Houston Pharmaceuticals, Inc. (HPI) of its intent to terminate the HPI License effective July 14, 2024, believing it will not affect Berubicin development as the patents have expired[184](index=184&type=chunk) - No Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements were adopted or terminated by the company's directors or executive officers during the reporting period[203](index=203&type=chunk) [Item 6. Exhibits](index=25&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including various corporate documents, warrant forms, agreements, and certifications - The exhibits include a Certificate of Amendment to Articles of Incorporation, forms of Series A, Series B, and Pre-Funded Warrants, Placement Agent Agreement, Securities Purchase Agreement, Amendment to Common Stock Purchase Warrants, the 2020 Equity Plan, and certifications by the Principal Executive and Financial Officers[76](index=76&type=chunk)[204](index=204&type=chunk)[205](index=205&type=chunk) [Signatures](index=26&type=section&id=Signatures) The report was duly signed on behalf of CNS Pharmaceuticals, Inc. by its Chief Executive Officer and Chief Financial Officer on May 15, 2024 - The report was signed by John Climaco, Chief Executive Officer and Director, and Christopher Downs, Chief Financial Officer, on May 15, 2024[78](index=78&type=chunk)[101](index=101&type=chunk)[206](index=206&type=chunk)

[Filing Information](index=1&type=section&id=Filing%20Information) This section details the registrant's identification, incorporation jurisdiction, emerging growth status, and registered securities [Registrant and Filing Details](index=1&type=section&id=Registrant%20and%20Filing%20Details) This section provides the basic identification details for CNS Pharmaceuticals, Inc. as the registrant, including its address, jurisdiction, and confirmation of its status as an emerging growth company - Registrant: **CNS Pharmaceuticals, Inc.**[1](index=1&type=chunk) - Jurisdiction of Incorporation: **Nevada**[1](index=1&type=chunk) - Emerging Growth Company Status: **Yes**[3](index=3&type=chunk) [Securities Registered](index=1&type=section&id=Securities%20Registered) The company's common stock is registered on The NASDAQ Stock Market LLC under the trading symbol CNSP | Title of each class | Trading Symbols(s) | Name of each exchange on which registered | | :------------------ | :----------------- | :---------------------------------------- | | Common stock, par value $0.001 per share | CNSP | The NASDAQ Stock Market LLC | [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) CNS Pharmaceuticals, Inc. announced its financial results for the period ended December 31, 2023, and recent operational highlights through a press release issued on April 1, 2024. This press release is incorporated by reference as Exhibit 99.1 - Company issued a press release on **April 1, 2024**, announcing financial results for the period ended **December 31, 2023**, and recent operational highlights[5](index=5&type=chunk) - The press release is attached to this report as **Exhibit 99.1** and is incorporated by reference[5](index=5&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section details the financial statements and exhibits filed with the report, including the press release and interactive data file [Exhibits List](index=2&type=section&id=Exhibits%20List) This section lists the exhibits filed with the Form 8-K, including the press release detailing financial results and the interactive data file | Exhibit No. | Exhibit Description | | :------------ | :---------------------------------------------------------- | | 99.1 | Press release dated April 1, 2024 | | 104 | Cover page Interactive Data File (embedded within the Inline XBRL document) | [Signature](index=3&type=section&id=Signature) The report was duly signed on behalf of CNS Pharmaceuticals, Inc. by Chris Downs, Chief Financial Officer, on April 1, 2024, in accordance with the Securities Exchange Act of 1934 requirements - Report signed by **Chris Downs**, Chief Financial Officer of **CNS Pharmaceuticals, Inc.**[10](index=10&type=chunk) - Date of signature: **April 1, 2024**[10](index=10&type=chunk)

We will continue to require substantial additional capital to continue our clinical development and commercialization activities. Because successful development of our product candidates is uncertain, we are unable to estimate the actual amount of funding we will require to complete research and development and commercialize our products under development. · whether our plan for clinical trials will be completed on a timely basis; · the costs associated with securing and establishing commercialization and m ...

Table of Contents SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ______________ Commission file number: 001-39126 CNS Pharmaceuticals, Inc. (Name of registrant as specified in its charter) Nevada 82-2318545 (Stat ...

We do not have manufacturing facilities and all manufacturing activities are contracted out to third parties. Additionally, we do not have a sales organization. On June 10, 2020, the FDA granted Orphan Drug Designation ("ODD") for Berubicin for the treatment of malignant gliomas. ODD from the FDA is available for drugs targeting diseases with less than 200,000 cases per year. ODD may enable market exclusivity of 7 years from the date of approval of a NDA in the United States. During that period the FDA gene ...

In addition to the other information set forth in this report, you should carefully consider the factors discussed in the section entitled "Risk Factors" in our 2022 Annual Report on Form 10-K, filed with the SEC, which are incorporated herein by reference, as well as the additional risk factors set forth below. The risks described in such reports 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 materi ...

| --- | --- | --- | --- | |--------------|-------|-------|------------------------------------------------------------------------------------| | | | | | | | | | | | NASDAQ: CNSP | | | | | | | | | | April 2023 | | | www.cnspharma.com 2100 West Loop South, Suite 900 Houston, TX 77027 (800) 946-9185 | Forward-Looking Statements This presentation incorporates information from materials filed with the SEC and contains forward-looking statements. All statements contained herein other than statements of historica ...

On June 10, 2020, the FDA granted Orphan Drug Designation ("ODD") for Berubicin for the treatment of malignant gliomas. ODD from the FDA is available for drugs targeting diseases with less than 200,000 cases per year. ODD may enable market exclusivity of 7 years from the date of approval of a NDA in the United States. During that period the FDA generally could not approve another product containing the same drug for the same designated indication. Orphan drug exclusivity will not bar approval of another pro ...