Qualigen Therapeutics(US:QLGN)2025-07-21 21:27PART I. Financial Information This section presents the unaudited condensed consolidated financial statements, management's discussion and analysis, market risk disclosures, and controls and procedures for the reporting period Condensed Consolidated Financial Statements (Unaudited) For the quarter ended March 31, 2025, the company reported a net loss of $2.6 million, an increase from the $2.1 million loss in the same period last year, with significant deterioration in financial health and a going concern warning Condensed Consolidated Balance Sheets As of March 31, 2025, the company's financial position weakened significantly compared to December 31, 2024, with cash and cash equivalents decreasing by over 97% and total stockholders' equity collapsing to $33,134 Condensed Consolidated Balance Sheets (Unaudited) | | March 31, 2025 ($) | December 31, 2024 ($) | | :--- | :--- | :--- | | Current Assets | | | | Cash and cash equivalents | $30,210 | $1,174,608 | | Total current assets | $2,845,538 | $4,684,519 | | Total Assets | $2,847,538 | $4,686,519 | | Current Liabilities | | | | Total current liabilities | $2,814,404 | $2,007,483 | | Total Stockholders' Equity (Deficit) | $33,134 | $2,679,036 | Condensed Consolidated Statements of Operations For the three months ended March 31, 2025, the company reported a net loss of $2.65 million, an increase from $2.03 million in the prior year, driven by a 136% surge in general and administrative expenses Condensed Consolidated Statements of Operations (Unaudited) | | For the Three Months Ended March 31, ($) | | :--- | :--- | :--- | | | 2025 | 2024 | | General and administrative | $2,494,532 | $1,057,364 | | Research and development | $33,167 | $364,385 | | Loss from Operations | $(2,724,699) | $(1,421,749) | | Net Loss | $(2,646,172) | $(2,032,751) | | Net loss attributable to Qualigen | $(2,646,172) | $(2,092,768) | | Total net loss per common share, basic and diluted | $(1.82) | $(17.60) | | Weighted-average number of shares outstanding | 1,456,714 | 118,876 | Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit) During the first quarter of 2025, total stockholders' equity decreased from $2.68 million to just $33,134, primarily due to the $2.65 million net loss for the period Changes in Stockholders' Equity (Deficit) for Q1 2025 | | Amount ($) | | :--- | :--- | | Balance at December 31, 2024 | $2,679,036 | | Conversion of Series A-2 preferred shares | $0 | | Stock-based compensation | $269 | | Net loss | $(2,646,172) | | Balance at March 31, 2025 | $33,134 | Condensed Consolidated Statements of Cash Flows For the three months ended March 31, 2025, net cash used in operating activities was $1.6 million, a significant increase from $0.8 million in the prior-year period, leading to a critically low cash balance of $30,210 Condensed Consolidated Statements of Cash Flows (Unaudited) | | For the Three Months Ended March 31, ($) | | :--- | :--- | :--- | | | 2025 | 2024 | | Net cash used in operating activities | $(1,589,396) | $(783,586) | | Net cash used in investing activities | $(305,000) | $0 | | Net cash provided by financing activities | $750,000 | $475,000 | | Net change in cash and cash equivalents | $(1,144,396) | $(308,586) | | Cash and cash equivalents - beginning of period | $1,174,608 | $401,803 | | Cash and cash equivalents - end of period | $30,210 | $93,217 | Notes to Condensed Consolidated Financial Statements The notes detail significant events and accounting policies, including a going concern warning, the issuance of $0.8 million in short-term promissory notes, a lawsuit for $503,000 in unpaid fees, and subsequent borrowings of $2.5 million - The company's financial condition raises substantial doubt about its ability to continue as a going concern for the next year, with only $30,000 in cash and an accumulated deficit of $125.7 million as of March 31, 20255153 - In Q1 2025, the company issued $0.8 million in short-term promissory notes, which are unsecured and mature in six months, including a potential default penalty of $0.3 million85 - On January 29, 2025, LifeSci Capital LLC filed a lawsuit against the company, claiming $503,483 in unpaid fees, which the company disputes and is defending91 - Subsequent to March 31, 2025, the company borrowed an additional $2.5 million through short-term notes and convertible debt, and advanced another $1.2 million to Marizyme149150151 Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's focus as an early-clinical-stage therapeutics company with programs in adult and pediatric cancer, highlighting its weak financial position, recurring losses, and reliance on raising additional capital Overview Qualigen is an early-clinical-stage therapeutics company developing cancer treatments, including QN-302 and a Pan-RAS program, but has slowed development and implemented expense controls due to its financial situation - The company's lead program is QN-302, an investigational small molecule for cancers like pancreatic cancer159 - The preclinical Pan-RAS program consists of small molecules designed to inhibit mutated RAS genes' proteins, potentially treating about a quarter of all cancers160 - A co-development agreement with Marizyme entitles Qualigen to a 33% royalty on net sales of DuraGraft™, capped at twice the funding provided by Qualigen161 - The company slowed development of its therapeutic products beginning in Q2 2024 due to its financial situation and has implemented dramatic expense controls162 Results of Operations Comparing Q1 2025 to Q1 2024, general and administrative expenses increased by $1.4 million (135%) due to fundraising, while research and development expenses decreased by $0.3 million (90%) as activities were slowed Comparison of Operating Expenses (Q1 2025 vs Q1 2024) | Expense Category | Q1 2025 ($) | Q1 2024 ($) | Change ($) | Change (%) | | :--- | :--- | :--- | :--- | :--- | | General and administrative | $2,494,532 | $1,057,364 | +$1,437,168 | +135.9% | | Research and development | $33,167 | $364,385 | -$331,218 | -90.9% | | Credit loss expense | $197,000 | $0 | +$197,000 | N/A | | Total Expenses | $2,724,699 | $1,421,749 | +$1,302,950 | +91.6% | Liquidity and Capital Resources The company's financial position is weak, with only $30,000 in cash and a $125.7 million accumulated deficit, raising substantial doubt about its ability to continue as a going concern, necessitating additional capital raises - As of March 31, 2025, the company had approximately $30,000 in cash, an accumulated deficit of $125.7 million, and is in arrears on accounts payable184 - The company borrowed a total of $3,515,000 from nine investors as short-term borrowings between January and June 2025 and plans to close a private placement in July 2025186 - The company received a delisting notice from Nasdaq for late filings but was granted a continued listing subject to meeting filing deadlines for its 2024 10-K and Q1 2025 10-Q190 Cash Flows In Q1 2025, cash used in operating activities doubled to $1.6 million, reflecting a higher net loss, while investing activities used $0.3 million and financing activities provided $0.8 million, resulting in a $1.1 million decrease in cash Summary of Cash Flows (Q1 2025 vs Q1 2024) | Activity | Q1 2025 ($) | Q1 2024 ($) | | :--- | :--- | :--- | | Net cash used in operating activities | $(1,589,399) | $(783,586) | | Net cash used in investing activities | $(305,000) | $0 | | Net cash provided by financing activities | $750,000 | $475,000 | | Net decrease in cash | $(1,144,399) | $(308,586) | Quantitative and Qualitative Disclosures About Market Risk The company is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is therefore not required to provide the information for this item - As a smaller reporting company, Qualigen is not required to provide quantitative and qualitative disclosures about market risk208 Controls and Procedures Management concluded that the company's disclosure controls and procedures were not effective as of March 31, 2025, due to material weaknesses in internal control over financial reporting, with remediation contingent upon securing additional funding - Management concluded that disclosure controls and procedures were not effective as of March 31, 2025210 - Material weaknesses were identified, including: lack of sufficient personnel for segregation of duties, ineffective IT General Controls over the financial accounting system, and lack of formalized process documentation214 - The company stated that it lacks the resources to employ additional personnel to remediate these weaknesses and does not foresee remediation until it receives additional funding215 PART II. Other Information This section details legal proceedings, risk factors, equity sales, defaults, and other miscellaneous information and exhibits Legal Proceedings The company is currently a defendant in a lawsuit filed by LifeSci Capital LLC on January 29, 2025, for alleged unpaid fees of $503,483, which the company denies and is vigorously defending - The company was sued by LifeSci Capital LLC for an alleged failure to pay $503,483 in fees220 - The company filed its answer denying the allegations on March 17, 2025, and as of May 29, 2025, the matter is in the discovery phase221 Risk Factors There have been no material changes to the company's risk factors since those disclosed in its 2024 Annual Report on Form 10-K - No material changes to the Company's risk factors have occurred since the 2024 Annual Report223 Unregistered Sales of Equity Securities and Use of Proceeds The company reported no unregistered sales of equity securities and no purchases of its equity securities during the reporting period - There were no unregistered sales of equity securities or issuer purchases of equity securities in the quarter224225 Defaults Upon Senior Securities The company reported no defaults upon its senior securities - None reported225 Mine Safety Disclosures This item is not applicable to the company - Not Applicable225 Other Information The company reported no information for this item - None reported225 Exhibits The report lists the exhibits filed, which include the required certifications by the Chief Executive Officer and Chief Financial Officer under the Sarbanes-Oxley Act, as well as the financial statements formatted in Inline XBRL - Exhibits filed with the report include CEO and CFO certifications and financial data in Inline XBRL format226