Company Overview - Wellgistics Health Inc. (NASDAQ: WGRX) is focused on modernizing the U.S. prescription drug market, which is valued at over $600 billion, by eliminating intermediaries and enhancing transparency [1][5] - The company offers a vertically integrated tech stack that supports pharmacies, providers, manufacturers, and employer groups through AI-powered infrastructure [2][5] Business Model and Strategy - Wellgistics Health aims to provide faster, cheaper, and smarter medication access, operating as a pharmacy benefit manager (PBM) alternative while remaining PBM-agnostic [5] - The company is scaling its direct distribution network and expanding employer carve-out programs, emphasizing compliant, tech-enabled pharmacy solutions [3][5] Investor Engagement - The CEO of Wellgistics Health, Brian Norton, expressed the importance of transparency in building trust with the investor community, highlighting the company's vision to address systemic inefficiencies in healthcare [3] - The interview conducted by Floorstocks serves as part of a broader investor education campaign to increase institutional visibility for Wellgistics Health [3][4]

Part I. Financial Information [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) For Q1 2025, Wellgistics Health reported $10.9 million in net sales but a $32.4 million net loss, primarily due to non-cash stock-based compensation, with going concern uncertainty [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets increased slightly to $58.1 million, liabilities rose to $53.6 million, and stockholders' equity decreased to $4.5 million due to net loss | Financial Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $2,516,585 | $1,028,336 | | Total current assets | $16,551,732 | $15,168,668 | | **Total assets** | **$58,063,100** | **$57,332,650** | | Total current liabilities | $46,225,313 | $38,046,747 | | **Total liabilities** | **$53,584,332** | **$50,598,204** | | **Total stockholders' equity** | **$4,478,768** | **$6,734,446** | [Consolidated Statements of Operations](index=5&type=section&id=Consolidated%20Statements%20of%20Operations) In Q1 2025, the company generated $10.9 million in net sales but incurred a $32.4 million net loss, largely due to $27.8 million in stock-based compensation | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net sales | $10,863,443 | $ - | | Gross profit | $692,641 | $ - | | Total operating expenses | $32,041,009 | $79,764 | | Loss from operations | ($31,348,368) | ($79,764) | | **Net loss** | **($32,430,903)** | **($83,122)** | | **Net loss per share** | **($0.62)** | **($0.00)** | - General and administrative expenses for Q1 2025 included **$27,773,421** of non-cash stock-based compensation related to the issuance of common stock to directors, employees, and consultants[188](index=188&type=chunk) [Consolidated Statements of Cash Flows](index=7&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Q1 2025 saw $1.3 million cash used in operations, offset by $3.1 million from financing activities, resulting in a quarter-end cash balance of $2.5 million | Cash Flow Activity | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | ($1,347,449) | $31,237 | | Net cash used in investing activities | ($273,133) | $ - | | Net cash provided by financing activities | $3,108,831 | $260,000 | | **Net change in cash and cash equivalents** | **$1,488,249** | **$291,237** | | **Cash and cash equivalents at end of period** | **$2,516,585** | **$292,601** | [Notes to Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail the February 2025 IPO, a going concern uncertainty due to recurring losses, $24.1 million total debt, and subsequent events including a merger and a $50 million equity line of credit - In February 2025, the company completed its IPO, generating gross proceeds of **$4.0 million** and net proceeds of approximately **$3.1 million**[23](index=23&type=chunk)[25](index=25&type=chunk) - The company has a net loss of **$32.4 million** for Q1 2025 and an accumulated deficit of **$42.2 million**, which raises substantial doubt about its ability to continue as a going concern[85](index=85&type=chunk) - As of March 31, 2025, total debt was **$24.1 million**, with key components being a **$15 million** note to the former owners of Wellgistics and a **$5.2 million** revolving line of credit[102](index=102&type=chunk) - Subsequent to the quarter end, the company entered into a merger agreement with Peek Healthcare Technologies and secured a **$50 million** equity line of credit (ELOC) with Hudson Global Ventures[135](index=135&type=chunk)[142](index=142&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A details the company's 'micro health ecosystem' business model, Q1 2025 results showing $10.9 million revenue but a $32.4 million net loss due to non-cash compensation, and ongoing liquidity concerns [Business Overview](index=31&type=section&id=Overview) The company operates as a holding company for a 'micro health ecosystem' through its 2024 acquisitions, focusing on an integrated model for the 'specialty-lite' drug market - The company's business is structured as a micro health ecosystem with three core operating companies: a technology platform, a pharmacy, and a wholesale operation[157](index=157&type=chunk) - Wellgistics, LLC is a key subsidiary, serving as a **50-state licensed** pharmaceutical wholesaler with a network of over **5,000 registered pharmacies**[160](index=160&type=chunk) - The company's strategy focuses on integrating its business segments to address access, care coordination, and clinical management, particularly in the growing 'specialty-lite' pharmaceutical market[169](index=169&type=chunk)[171](index=171&type=chunk) [Results of Operations](index=35&type=section&id=Results%20of%20Operations) Q1 2025 saw first significant revenues of $10.9 million, a 6.4% gross margin, but exceptionally high operating expenses of $32.0 million, leading to a $32.4 million net loss | Revenue Stream | Three Months Ended March 31, 2025 | | :--- | :--- | | Product revenue - distribution services | $10,668,287 | | Pharmacy retail sales | $114,676 | | Third party logistics services | $80,480 | | **Net sales** | **$10,863,443** | - The significant increase in general and administrative expenses was primarily due to **$27,773,421** of non-cash stock-based compensation[188](index=188&type=chunk) - Depreciation and amortization expense was **$802,872**, related to intangible and fixed assets acquired in the Wood Sage and Wellgistics, LLC acquisitions[189](index=189&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=Liquidity%20and%20Capital%20Resources) The company faces significant liquidity concerns with a going concern doubt, $1.3 million cash used in operations, $24.1 million total debt, and reliance on external financing like its recent IPO and a $50 million equity line of credit - The company expects to fund operations through operating cash flows, debt, and equity sales, but acknowledges that it may need to raise additional funds to execute its business plan[191](index=191&type=chunk) | Debt Component | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current portion of debt | $17,712,035 | $11,927,816 | | Long-term debt | $6,400,000 | $11,455,085 | | **Total debt** | **$24,112,035** | **$23,382,901** | - Net cash used in operating activities was **$1,347,449** for Q1 2025, primarily due to the net loss, partially offset by non-cash stock-based compensation[208](index=208&type=chunk) - Net cash from financing activities was **$3,108,831**, driven by **$4.0 million** in gross proceeds from the IPO[211](index=211&type=chunk) [Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025, with no material changes in internal control over financial reporting during the quarter - Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2025[226](index=226&type=chunk) - There were no changes in internal controls over financial reporting during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[227](index=227&type=chunk) Part II. Other Information [Risk Factors](index=42&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported, except for the company's ongoing liquidity needs - No material changes in risk factors were reported, except for the company's on-going liquidity needs[230](index=230&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=42&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the use of $3.1 million IPO proceeds for working capital and the issuance of 19.8 million restricted shares and 152,000 shares as a commitment fee - The company received net proceeds of approximately **$3.1 million** from its February 2025 IPO, which were used for general working capital[235](index=235&type=chunk)[237](index=237&type=chunk) - Between March 21 and March 27, 2025, the company issued **19,764,108 shares** of restricted stock to directors, employees, and consultants under its equity incentive plan[232](index=232&type=chunk) - On April 11, 2025, the company issued **152,000 shares** of common stock as a commitment fee to Hudson Global Ventures, LLC pursuant to an equity purchase agreement[232](index=232&type=chunk) [Other Information](index=43&type=section&id=Item%205.%20Other%20Information) This section covers post-quarter corporate governance changes, including the appointment of Michael L. Peterson as independent director and Audit Committee Chairman, and Mark DiSiena as the new CFO - Michael L. Peterson was appointed to the Board of Directors, designated as Chairman of the Audit Committee, and deemed an audit committee financial expert[242](index=242&type=chunk) - Mark DiSiena was appointed as Chief Financial Officer, effective April 22, 2025, succeeding Vishnu Balu who resigned without any disagreement with the company[244](index=244&type=chunk)[151](index=151&type=chunk)

Tampa, FL, May 08, 2025 (GLOBE NEWSWIRE) -- Wellgistics Health, Inc. (NASDAQ: WGRX), a technology-first pharmaceutical distribution and healthcare infrastructure company, today announced a new initiative to pioneer the use of XRP, a blockchain-based digital asset, as both a treasury reserve and a real-time payments infrastructure-which management believes, upon successful commercialization, would make Wellgistics among the first publicly traded healthcare companies to deploy XRP in this manner. This XRP pay ...

Tampa, FL, May 08, 2025 (GLOBE NEWSWIRE) -- Wellgistics Health, Inc. (NASDAQ: WGRX), a technology-first pharmaceutical distribution and healthcare infrastructure company, today announced a new initiative to pioneer the use of XRP, a blockchain-based digital asset, as both a treasury reserve and a real-time payments infrastructure-which management believes, upon successful commercialization, would make Wellgistics among the first publicly traded healthcare companies to deploy XRP in this manner. This XRP pay ...

Part I [Business Overview](index=5&type=section&id=Item%201.%20Business) Wellgistics Health, Inc. operates as a holding company integrating pharmacy, wholesale distribution, and technology platforms to create a micro health ecosystem focused on specialty-lite pharmaceuticals - The company operates as a holding company for a pharmacy (Wellgistics Pharmacy), a wholesale distributor (Wellgistics LLC), and a technology hub (DelivMeds), aiming to create an integrated 'micro health ecosystem'[19](index=19&type=chunk)[20](index=20&type=chunk) - The company completed the acquisition of Wood Sage (holding company for DelivMeds and Wellgistics Pharmacy) on June 16, 2024, and the acquisition of Wellgistics LLC on August 30, 2024[21](index=21&type=chunk)[25](index=25&type=chunk) - The business model focuses on the 'specialty-lite' or niche pharmaceutical market, leveraging synergies between its pharmacy, wholesale, and technology divisions to improve patient outcomes and provide value to stakeholders[19](index=19&type=chunk)[28](index=28&type=chunk) [Pharmacy — Wellgistics Pharmacy](index=7&type=section&id=Pharmacy%20%E2%80%94%20Wellgistics%20Pharmacy) Wellgistics Pharmacy is a mail-order pharmacy licensed in 32 states and D.C., offering general and specialty services with a revenue model based on prescription reimbursement and planned SaaS fees - Wellgistics Pharmacy is licensed in **32 states and the District of Columbia**, operating as a mail-order pharmacy with a focus on both general and specialty services[33](index=33&type=chunk) - Key services include patient care coordination, clinical drug therapy management, compliance packaging, patient financial assistance, and managing prior authorizations and REMS protocols[35](index=35&type=chunk)[38](index=38&type=chunk) - The current revenue model is based on prescription reimbursement, but the company plans to introduce recurring SaaS transaction fees for its technology platform and services offered to its network of independent pharmacies[36](index=36&type=chunk) [Wholesale — Wellgistics LLC](index=8&type=section&id=Wholesale%20%E2%80%94%20Wellgistics%20LLC) Wellgistics LLC is a 50-state licensed pharmaceutical wholesaler serving over 5,000 pharmacies, specializing in niche therapeutic products and offering 3PL services - Wellgistics LLC is a **50-state licensed wholesaler** serving over **5,000 pharmacies** and has relationships with over **60 manufacturers**[37](index=37&type=chunk)[39](index=39&type=chunk) - The product portfolio consists of approximately **65% topical generics** (dermatology focus), **20% oral generics** (non-narcotic pain), **10% brand formulations**, and **5% OTC products**[39](index=39&type=chunk) - Services include pharmaceutical distribution and third-party logistics (3PL), such as warehousing, inventory management, and shipping, from facilities in Lakeland, FL, and Columbus, OH[42](index=42&type=chunk) [Technology (Hub & Clinical Services) — DelivMeds](index=9&type=section&id=Technology%20%28Hub%20%26%20Clinical%20Services%29%20%E2%80%94%20DelivMeds) DelivMeds is the company's technology arm, providing a pharmaceutical hub platform with AI-driven prescription routing and clinical concierge services for B2B clients - DelivMeds serves as the middleware technology between patients, providers, pharmacies, payors, and pharmaceutical companies (the '5P-Model')[40](index=40&type=chunk) - The platform uses an AI-driven algorithm for 'smart' routing of prescriptions to partner pharmacies based on contracts, licenses, and pricing, and facilitates delivery through partnerships with Lyft and Roadie[43](index=43&type=chunk) - Key services include benefits investigation, prior authorization assistance, patient financial assistance, data access and reporting, and clinical services like MTM and tele-pharmacy support[43](index=43&type=chunk) [The 5P-Model: Value Proposition to Stakeholders](index=11&type=section&id=The%205P-Model) The company's '5P-Model' strategy aims to deliver synergistic value to Patients, Providers, Pharmacies, Pharmaceutical Manufacturers, and Payors/PBMs through integrated services - The company's core strategy is the '5P-Model,' designed to provide synergistic value to Patients, Providers, Pharmacies, Payors/PBMs, and Pharmaceutical Manufacturing Companies[44](index=44&type=chunk) - For pharmaceutical manufacturers, the company offers a distribution channel, patient adherence programs, and access to de-identified clinical data, for which it receives fees[53](index=53&type=chunk)[55](index=55&type=chunk) - For payors and PBMs, the company aims to reduce long-term healthcare costs by improving medication adherence and offering a potential integrated ecosystem for mail order, network management, and wholesale pricing[60](index=60&type=chunk)[62](index=62&type=chunk) [Risk Factors](index=15&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including integration challenges, reimbursement pressures, intense competition, operational disruptions, cybersecurity threats, and financial vulnerabilities from debt and limited operating history - Significant business risks include difficulties integrating the Wellgistics LLC and Wood Sage acquisitions, potential for unrealized synergies, and a limited operating history as a combined entity[63](index=63&type=chunk)[67](index=67&type=chunk)[69](index=69&type=chunk) - The company is exposed to financial risks from reductions in third-party reimbursement, margin compression, and direct and indirect remuneration (DIR) fees from PBMs, which could adversely affect profitability[63](index=63&type=chunk)[70](index=70&type=chunk)[72](index=72&type=chunk) - Operational and technology risks are substantial, including potential disruptions in IT systems, cybersecurity incidents, data breaches of protected health information (PHI), and compliance with privacy laws like HIPAA[64](index=64&type=chunk)[133](index=133&type=chunk)[139](index=139&type=chunk) - The company has significant outstanding debt (**$33.3 million** as of Dec 31, 2024) and a substantial amount of goodwill and intangible assets from acquisitions, which could become impaired and result in material non-cash charges[65](index=65&type=chunk)[144](index=144&type=chunk)[148](index=148&type=chunk) [Cybersecurity](index=51&type=section&id=Item%201C.%20Cybersecurity) The company lacks a formal cybersecurity risk management program, with board oversight, and achieved SOC-II Type 1 compliance in March 2025 without material incidents in 2024 - The company does not have a formal cybersecurity risk management program, with oversight handled by the full board of directors[229](index=229&type=chunk) - Wellgistics Health obtained SOC-II Type 1 compliance on March 18, 2025[229](index=229&type=chunk) [Properties](index=51&type=section&id=Item%202.%20Properties) The company leases its 6,200 sq. ft. corporate office in Tampa, Florida, under a 3-year agreement commencing May 2024, with shared rent - The company leases its **6,200 sq. ft.** corporate office in Tampa, FL under a 3-year agreement that commenced in May 2024[230](index=230&type=chunk) [Legal Proceedings](index=51&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently involved in any legal proceedings expected to materially impact its financial position or operations - The company is not currently subject to any material legal proceedings[233](index=233&type=chunk) Part II [Market for Common Equity and Related Matters](index=53&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's common stock began trading on Nasdaq under 'WGRX' in February 2025, with 51.9 million shares outstanding and $3.12 million net proceeds from its IPO - The company's common stock began trading on Nasdaq under the symbol 'WGRX' on February 14, 2025[236](index=236&type=chunk) - On February 24, 2025, the company closed its IPO of **888,889 shares** at **$4.50 per share**, generating gross proceeds of **$4.0 million** and net proceeds of approximately **$3.12 million**[240](index=240&type=chunk)[241](index=241&type=chunk) - As of March 20, 2025, there were **51,944,397 shares** of common stock outstanding[237](index=237&type=chunk) [Management's Discussion and Analysis (MD&A)](index=54&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A highlights 2024's first revenues of $18.1 million, a $6.9 million net loss, $33.3 million in debt, and a going concern uncertainty requiring additional funding [Results of Operations](index=59&type=section&id=Results%20of%20Operations) In FY2024, the company generated $18.1 million in net sales and a $1.77 million gross profit, but increased operating expenses led to a $6.86 million net loss Financial Performance (FY 2024 vs. FY 2023) | Metric | FY 2024 (ended Dec 31) | FY 2023 (ended Dec 31) | | :--- | :--- | :--- | | **Net Sales** | $18,128,831 | $- | | **Gross Profit** | $1,767,314 | $- | | **Total Operating Expenses** | $7,912,446 | $2,880,603 | | **Loss from Operations** | $(6,145,132) | $(2,880,603) | | **Net Loss** | $(6,856,226) | $(2,895,684) | - The increase in general and administrative expenses to **$6.8 million** in 2024 from **$2.9 million** in 2023 was primarily due to the acquisition of Wellgistics LLC[273](index=273&type=chunk) - The company recorded **$1.11 million** in depreciation and amortization in 2024, related to intangible and fixed assets from the Wood Sage and Wellgistics, LLC acquisitions[274](index=274&type=chunk) [Liquidity and Capital Resources](index=60&type=section&id=Liquidity%20and%20Capital%20Resources) Future operations depend on cash flow, debt, and equity, with management expecting positive cash flow in 2025 but acknowledging the need for additional capital given $33.3 million in debt - The company's ability to continue as a going concern is dependent on generating sufficient revenue and/or obtaining additional financing[277](index=277&type=chunk)[409](index=409&type=chunk) Cash Flow Summary (FY 2024 vs. FY 2023) | Cash Flow Activity | FY 2024 (ended Dec 31) | FY 2023 (ended Dec 31) | | :--- | :--- | :--- | | Net cash used in operating activities | $(511,918) | $(349,136) | | Net cash provided by investing activities | $469,072 | $- | | Net cash provided by financing activities | $1,069,818 | $350,500 | - As of December 31, 2024, total debt and credit obligations amounted to **$33.3 million**[144](index=144&type=chunk) [Critical Accounting Policies and Estimates](index=62&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve significant judgment, particularly in revenue recognition for wholesale and pharmacy segments, and business combinations for purchase price allocation - Revenue for wholesale distribution (Wellgistics LLC) is recognized when goods are delivered to the customer, net of estimated chargebacks, rebates, and allowances[295](index=295&type=chunk) - Revenue for the retail pharmacy (Wellgistics Pharmacy) is recognized when the patient confirms delivery of the prescription[296](index=296&type=chunk) - The company accounts for acquisitions using the business combination method, allocating the purchase price to tangible and intangible assets and liabilities at their estimated fair values, with the excess recorded as goodwill[300](index=300&type=chunk) [Financial Statements and Notes](index=63&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplemental%20Data) Audited financial statements for 2024 and 2023 reflect the impact of 2024 acquisitions, significant debt, and a 'going concern' uncertainty, with detailed notes on business combinations and subsequent events - The independent auditor's report includes a 'going concern' paragraph, citing the company's history of losses and accumulated deficit, which raises substantial doubt about its ability to continue without additional funding[306](index=306&type=chunk)[408](index=408&type=chunk) - A critical audit matter identified was the valuation of intangible assets (customer relationships, trademark) acquired in the Wood Sage and Wellgistics, LLC business combinations, due to the high degree of judgment required for assumptions like revenue growth and discount rates[311](index=311&type=chunk)[312](index=312&type=chunk) [Consolidated Balance Sheet Highlights](index=67&type=section&id=Consolidated%20Balance%20Sheet) As of December 31, 2024, total assets increased to $57.3 million due to acquisitions, with $50.6 million in liabilities and $6.7 million in stockholders' equity Consolidated Balance Sheet Data (as of Dec 31) | Metric | 2024 | 2023 | | :--- | :--- | :--- | | **Total Assets** | $57,332,650 | $338,364 | | Goodwill | $16,219,929 | - | | Other Intangible Assets, net | $20,746,009 | - | | Inventories, net | $9,518,608 | - | | **Total Liabilities** | $50,598,204 | $3,238,798 | | Total Current Liabilities | $38,046,747 | $2,888,798 | | **Total Stockholders' Equity (Deficit)** | $6,734,446 | $(2,900,434) | [Note 3: Business Combinations](index=83&type=section&id=Note%203.%20Business%20Combinations) In 2024, the company acquired Wood Sage for $0.4 million (stock) and Wellgistics, LLC for $40.0 million (cash, note, stock), resulting in significant goodwill and intangible assets Wellgistics, LLC Purchase Price Allocation (Summary) | Component | Value | | :--- | :--- | | Cash Payment (due to seller) | $10,000,000 | | Note Payable | $15,000,000 | | Common Stock Issued | $15,000,000 | | **Total Purchase Price** | **$40,000,000** | - The Wellgistics, LLC acquisition resulted in the recognition of **$14.7 million** in goodwill, **$11.3 million** in customer relationships, and **$10.1 million** in trademarks[418](index=418&type=chunk) - The Wood Sage acquisition had a purchase price of **$400,000** (paid in stock) and resulted in **$1.55 million** of goodwill[416](index=416&type=chunk) [Note 9: Debt](index=87&type=section&id=Note%209.%20Debt) As of December 31, 2024, total debt was $23.4 million, primarily comprising a $15 million note, a $5.5 million line of credit, and $1.3 million notes Outstanding Debt (as of Dec 31, 2024) | Debt Instrument | Current Portion | Long-Term Portion | Total | | :--- | :--- | :--- | :--- | | Merchant cash advance | $1,259,415 | $55,085 | $1,314,500 | | Note payable - owners of Wellgistics | $5,000,000 | $10,000,000 | $15,000,000 | | Revolving line of credit | $5,531,260 | - | $5,531,260 | | Note payable - Scienture Holdings | - | $1,300,000 | $1,300,000 | | Other Notes | $137,141 | $100,000 | $237,141 | | **Total** | **$11,927,816** | **$11,455,085** | **$23,382,901** | [Controls and Procedures](index=94&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and internal control over financial reporting were effective as of December 31, 2024, with no material changes reported - Management concluded that the company's disclosure controls and procedures were effective as of December 31, 2024[474](index=474&type=chunk) - Based on the COSO framework, management believes the company maintained effective internal control over financial reporting as of December 31, 2024[478](index=478&type=chunk) Part III [Directors, Executive Officers and Corporate Governance](index=96&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) The executive team includes Brian Norton (CEO) and Vishnu Balu (CFO), with a board chaired by Suren Ajjarapu and an audit committee of three independent directors - The executive team is led by CEO Brian Norton and CFO Vishnu Balu. The Board of Directors is chaired by Suren Ajjarapu[486](index=486&type=chunk)[487](index=487&type=chunk) - The audit committee is composed of three independent directors: Donald W. Anderson, Rebecca Shanahan, and Sajid Syed (Chair)[497](index=497&type=chunk) [Executive Compensation](index=99&type=section&id=Item%2011.%20Executive%20Compensation) FY2024 NEO compensation included $400,000 salaries for former CEO Suren Ajjarapu and former COO Prashant Patel, and the adoption of an equity incentive plan with 43.5 million shares 2024 Summary Compensation Table | Name and Principal Position | Year | Salary ($) | Total ($) | | :--- | :--- | :--- | :--- | | Suren Ajjarapu (Former CEO) | 2024 | 400,000 | 400,000 | | Prashant Patel (Former COO) | 2024 | 400,000 | 400,000 | | Dr. Shafaat Pirani (CCO) | 2024 | 275,000 | 275,000 | | Tim Canning (Former CEO) | 2024 | 300,000 | 330,000 | - The company adopted the Amended and Restated 2023 Equity Incentive Plan, with an initial **43,506,064 shares** available for issuance[522](index=522&type=chunk)[525](index=525&type=chunk) - Independent directors receive an annual cash retainer of **$50,000**[551](index=551&type=chunk) [Security Ownership](index=108&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) As of March 20, 2025, directors and executive officers collectively owned 30.41% of common stock, with Prashant Patel and Suren Ajjarapu as significant individual holders Beneficial Ownership (as of March 20, 2025) | Name of Beneficial Owner | Percentage | | :--- | :--- | | **Directors and NEOs (as a group)** | **30.41%** | | Prashant Patel | 17.53% | | Suren Ajjarapu | 12.25% | | **Five Percent Holders:** | | | Annapurna Gundlapalli Revocable Trust 2010 | 17.22% | | Patel Trust 2010 | 8.61% | | Sandhya Ajjarapu Revocable Trust 2007 | 7.44% | [Related Transactions and Director Independence](index=110&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) All directors are independent except Prashant Patel, with significant related party transactions involving acquisitions, executive employment agreements, and a financial advisory agreement with the CFO's firm - The board has determined all directors are independent except for Prashant Patel, who is an executive officer[567](index=567&type=chunk) - The acquisition of Wellgistics LLC involved a purchase agreement with entities beneficially owned by current CEO Brian Norton[570](index=570&type=chunk)[572](index=572&type=chunk) - The company entered into an agreement with Aletheia Strategic Advisory LLC, an entity owned by CFO Vishnu Balu, for his services as financial lead for an annual fee of **$200,000**[581](index=581&type=chunk) [Principal Accountant Fees and Services](index=113&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Suri & Co. served as the principal accountant, with audit fees of $96,000 in 2024 and $109,000 in 2023, and the Audit Committee pre-approves all services Accountant Fees | Fee Type | 2024 | 2023 | | :--- | :--- | :--- | | Audit Fees | $96,000 | $109,000 | | Audit-Related Fees | - | - | | Tax Fees | - | - | | All Other Fees | - | - | | **Total** | **$96,000** | **$109,000** |