Bullfrog AI (BFRG) - 2024 Q4 - Annual Report

Part I Business Bullfrog AI Holdings, Inc. leverages its bfLEAP™ platform for drug development through contract services, collaborations, and asset acquisition - The company utilizes its bfLEAP™ AI/ML platform to accelerate drug development and reduce costs[23] - The business model encompasses contract services, collaborative arrangements with milestone payments, and strategic drug asset acquisition and divestiture[33][34][35] - Exclusive worldwide licenses include a mebendazole formulation for cancer and an siRNA-based therapeutic for liver diseases[31][36] - A strategic partnership with Lieber Institute for Brain Development (LIBD) focuses on identifying new biomarkers and drug targets for neurological disorders[47] - In February 2025, a collaboration with Eleison Pharmaceuticals began to analyze clinical data for their pancreatic cancer drug, glufosfamide[25][46] Risk Factors As a smaller reporting company, the company is exempt from providing specific risk factor disclosures - Smaller reporting companies are not required to provide the information for this item[119] Unresolved Staff Comments The company reports no unresolved staff comments - Not applicable[120] Cybersecurity The company integrates cybersecurity risk management into its overall framework, overseen by the audit committee, with no material incidents reported - Cybersecurity risk management is integrated into overall risk systems, with periodic assessments to identify and manage threats[121][122] - The board's audit committee oversees cybersecurity risk management, receiving regular reports from the IT team[126][128] - To date, no cybersecurity incidents have materially affected the company's operations or financial condition[125] Properties The company operates virtually with no owned or leased real property, maintaining a principal business address - The company does not own any real property, with all employees working virtually[129] Legal Proceedings The company is not currently involved in any legal or administrative proceedings - The company is not currently a party to any legal or administrative proceedings[130] Mine Safety Disclosures This item is not applicable to the company's operations - Not applicable[131] Part II Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities The company's common stock and warrants trade on Nasdaq, with no dividends paid or anticipated, and no equity repurchases in Q4 2024 - Common stock (BFRG) and tradeable warrants (BFRGW) commenced trading on the Nasdaq Capital Market on February 14, 2023[133] - The company has not paid dividends since inception and plans to retain future earnings for business development[135] - No equity securities were repurchased during the fourth quarter ended December 31, 2024[138] Management's Discussion and Analysis of Financial Condition and Plan of Operation The company reported no revenue in 2024, with operating expenses increasing 33% to $7.2 million, leading to a $7.0 million net loss and substantial doubt about its going concern ability Operating Expenses Comparison (2024 vs 2023) | Operating Expenses | 2024 ($) | 2023 ($) | Net Change ($) | Net Change (%) | | :--- | :--- | :--- | :--- | :--- | | Research and development | $2,223,265 | $1,432,614 | $790,651 | 55% | | General and administrative | $5,013,118 | $3,994,710 | $1,018,408 | 25% | | Total operating expenses | $7,236,383 | $5,427,324 | $1,809,059 | 33% | - The company's cash balance of approximately $5.4 million as of December 31, 2024, is insufficient for a year of operations, raising substantial doubt about its going concern ability[149][165] Consolidated Cash Flow Data (2024 vs 2023) | Cash Flow Activity | 2024 ($) | 2023 ($) | Net Change ($) | | :--- | :--- | :--- | :--- | | Net cash used in Operating activities | $(5,610,249) | $(6,001,299) | $391,050 | | Net cash used in Investing activities | - | - | - | | Net cash provided by Financing activities | $8,421,502 | $8,568,359 | $(146,857) | - The company, as an emerging growth company, has elected to use the extended transition period for new financial accounting standards compliance[176] Quantitative and Qualitative Disclosures About Market Risk As a smaller reporting company, the company is not required to provide quantitative and qualitative market risk disclosures - As a smaller reporting company, the company is not required to provide the information for this item[178] Financial Statements and Supplementary Data This section refers to the full consolidated financial statements and supplementary data appended to the Form 10-K, starting on page F-1 - The required financial statements are appended to the report, commencing on page F-1[179] Changes in and Disagreements with Accountants on Accounting and Financial Disclosure The company reports no changes in or disagreements with its accountants regarding financial disclosure - None[180] Controls and Procedures Management concluded that disclosure controls were ineffective as of December 31, 2024, due to a material weakness in internal controls, with remediation efforts underway - Management concluded that disclosure controls and procedures were ineffective as of December 31, 2024, due to material weaknesses in internal control over financial reporting[181] - A material weakness was identified due to inadequate documentation, implementation, or operation of effective internal controls over financial reporting, a weakness also present in 2023[184] - Remediation efforts include transitioning accounting to an external firm, implementing a new accounting platform, and hiring a Corporate Controller in 2024[186][189] Other Information No new 10b5-1 plans were adopted in Q4 2024, though CEO Vininder Singh's existing plan resulted in 50,000 shares sold - CEO Vininder Singh's 10b5-1 sales plan, effective until August 31, 2025, or 1,000,000 shares sold, resulted in 50,000 shares sold in each of Q2, Q3, and Q4 2024[188] Disclosure Regarding Foreign Jurisdictions that Prevent Inspections This item is not applicable to the company - Not applicable[189] Part III Directors, Executive Officers, and Corporate Governance The company's leadership includes CEO Vininder Singh and CFO Josh Blacher, with independent directors overseeing key committees and a commitment to board diversity - Executive officers include Vininder Singh (CEO) and Josh Blacher (CFO), supported by independent directors R. Donald Elsey, William Enright, and Jason D. Hanson[192] - The board comprises four male directors, with a stated commitment to seeking qualified women and minority candidates despite lacking a formal diversity policy[200] - The company has established Audit, Compensation, and Nominating & Corporate Governance committees, each composed of independent directors[203][205][208] - A Clawback Policy, effective December 1, 2023, allows for recovery of incentive-based compensation from executive officers upon material financial restatement[211] Executive Compensation In 2024, CEO Vininder Singh's total compensation was $630,680, while non-executive directors received $45,000 in cash and $34,050 in option awards 2024 Summary Compensation Table | Name and Principal Position | Year | Salary ($) | Option Awards ($) | Total Compensation ($) | | :--- | :--- | :--- | :--- | :--- | | Vininder Singh, CEO | 2024 | $400,000 | $230,680 | $630,680 | | Dane Saglio, former CFO | 2024 | $252,581 | $100,740 | $353,321 | | Josh Blacher, CFO | 2024 | $10,631 | $ - | $10,631 | 2024 Director Compensation | Name | Fees Earned in Cash ($) | Option Awards ($) | Total Compensation ($) | | :--- | :--- | :--- | :--- | | R. Donald Elsey | $45,000 | $34,050 | $79,050 | | William Enright | $45,000 | $34,050 | $79,050 | | Jason D. Hanson | $45,000 | $34,050 | $79,050 | - The 2022 Equity Incentive Plan authorizes equity awards, with 150,682 shares available for issuance as of December 31, 2024[228] Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters As of March 4, 2025, CEO Vininder Singh holds 26.09% beneficial ownership, with all officers and directors owning 28.20% collectively Security Ownership of Beneficial Owners (as of March 4, 2025) | Name of Beneficial Owner | Percentage of Common Stock | | :--- | :--- | | Vininder Singh (CEO and Director) | 26.09% | | All officers and directors as a group (6 persons) | 28.20% | | Tivoli Trust | 8.81% | | Empery Asset Management, LP | 9.88% | Equity Compensation Plan Information | Plan Category | Securities to be issued upon exercise of outstanding options, warrants and rights | Weighted-average exercise price ($) | Securities remaining available for future issuance | | :--- | :--- | :--- | :--- | | Equity compensation plans approved by security holders | 763,514 | $4.04 | 150,682 | | Equity compensation plans not approved by security holders | 747,376 | $1.69 | 0 | | Total | 1,510,890 | $2.88 | 150,682 | Certain Relationships and Related Transactions, and Director Independence The company discloses related party transactions with Tivoli Trust, including converted SAFE and convertible loan agreements, and maintains a formal approval policy - Upon the IPO in February 2023, a $150,000 SAFE agreement with Tivoli Trust converted into 32,967 common shares[241] - In February 2023, a $99,900 convertible loan with a related party converted into 21,747 common shares[242] - The company's policy requires audit committee review and approval for related person transactions exceeding $120,000 or 1% of average total assets[244][245] Principal Accounting Fees and Services M&K CPAs billed $71,545 in 2024 and $71,750 in 2023 for audit and audit-related services, all pre-approved by the audit committee Accountant Fees (M&K CPAs) | Fee Category | 2024 ($) | 2023 ($) | | :--- | :--- | :--- | | Audit fees | $44,725 | $35,200 | | Audit-related fees | $26,820 | $36,550 | | Tax fees | - | - | | All other fees | - | - | | Total fees | $71,545 | $71,750 | - The audit committee's policy requires pre-approval of all auditing and permitted non-audit services performed by the auditors[248] Part IV Exhibits, Financial Statement Schedules This section provides a comprehensive list of financial statements and all exhibits filed with the Form 10-K, including key agreements and certifications - This item provides a list of consolidated financial statements and a detailed index of all exhibits filed with the report[253] Form 10-K Summary No summary is provided under this item - None[255] Financial Statements Report of Independent Registered Public Accounting Firm The independent auditor issued a fair presentation opinion but included a "Going Concern" paragraph due to recurring losses and financial position - The auditor's report expresses substantial doubt about the company's going concern ability due to recurring losses and its financial position as of December 31, 2024[266] - The auditor identified 'Going Concern' as a critical audit matter, citing significant judgment in auditing management's future expenditure estimates[271] Consolidated Financial Statements The consolidated financial statements detail the company's financial position, operations, and cash flows, showing a 2024 net loss of $7.0 million and $5.44 million in cash Consolidated Balance Sheet Data (as of Dec 31) | | 2024 ($) | 2023 ($) | | :--- | :--- | :--- | | Assets | | | | Cash and cash equivalents | $5,435,983 | $2,624,730 | | Total current assets | $5,547,580 | $2,770,612 | | Total assets | $5,551,830 | $2,776,586 | | Liabilities and Equity | | | | Total current liabilities | $588,090 | $184,350 | | Total liabilities | $588,090 | $184,350 | | Total stockholders' equity | $4,963,740 | $2,592,236 | | Total liabilities and stockholders' equity | $5,551,830 | $2,776,586 | Consolidated Statement of Operations Data (for the Year Ended Dec 31) | | 2024 ($) | 2023 ($) | | :--- | :--- | :--- | | Revenue | $ - | $65,000 | | Gross profit | $ - | $59,800 | | Total operating expenses | $7,236,383 | $5,427,324 | | Loss from operations | $(7,236,383) | $(5,367,524) | | Net loss | $(6,993,647) | $(5,355,869) | | Net loss per common share - basic and diluted | $(0.85) | $(0.89) | Notes to Consolidated Financial Statements Notes to financial statements detail liquidity concerns, stockholders' equity components, and material agreements including significant royalty and milestone payment obligations - Note 1 (Liquidity and Going Concern) indicates the company's ~$5.4 million cash as of December 31, 2024, is insufficient for a year of operations, raising substantial doubt about its going concern ability[293] - Note 8 (Stockholders' Equity) shows the company raised gross proceeds of ~$6.5 million in February and ~$3.13 million in October 2024 through common stock and warrant offerings[336][337] - Note 10 (Material Agreements) outlines significant future financial commitments, including $300,000 minimum annual royalty payments to JHU-APL and potential milestone payments for licensed drug candidates[357][358][360] - Note 12 (Subsequent Events) details a February 2025 collaboration with Eleison Pharmaceuticals Inc. to analyze clinical trial data for an investigational pancreatic cancer treatment[366]