TRxADE HEALTH(MEDS) - 2025 Q2 - Quarterly Report

Financial Performance - Revenues for the three months ended June 30, 2025, were $0, compared to $18,699 for the same period in 2024, indicating a 100% decrease[17] - The net loss from continuing operations for the three months ended June 30, 2025, was $6,720,573, compared to a loss of $1,624,741 for the same period in 2024, marking an increase in loss of approximately 313.5%[17] - The company reported a net loss of $9,784,570 for the six months ended June 30, 2025, compared to a net loss of $8,258,163 for the same period in 2024, indicating an increase in losses of approximately 18.5%[21] - For the six months ended June 30, 2025, revenues totaled $10,258, down from $18,699 in 2024, reflecting a decrease of approximately 45%[93] - The company recognized a net income of $27,670,294 from discontinued operations for the six months ended June 30, 2025, compared to a loss of $3,500 in the same period of 2024[86] Assets and Liabilities - Total current assets decreased from $6,305,477 as of December 31, 2024, to $856,625 as of June 30, 2025, representing a decline of approximately 86.4%[12] - Total liabilities increased from $25,781,684 as of December 31, 2024, to $26,434,370 as of June 30, 2025, representing a rise of approximately 2.5%[14] - The accumulated deficit grew from $(39,038,973) as of December 31, 2024, to $(48,823,543) as of June 30, 2025, indicating an increase of approximately 25.1%[15] - Cash reserves significantly decreased from $308,096 as of December 31, 2024, to $15,391 as of June 30, 2025, a decline of approximately 95%[12] - The company's working capital turned negative, reaching $(6,831,574) compared to $(1,601,416) at the end of 2024, representing a 327% increase in negative working capital[206] Stock and Equity - The company issued common stock for services amounting to $3,781,253 during the six months ended June 30, 2025, compared to $4,450,919 in the prior year, showing a decrease of about 15%[21] - The total stockholders' equity decreased from $79,072,121 as of December 31, 2024, to $77,860,464 as of June 30, 2025, reflecting a decline of approximately 1.5%[15] - The company raised gross proceeds of $4,597,999 from the issuance of common stock during the six months ended June 30, 2025, compared to no proceeds in the prior year[21] Strategic Actions and Acquisitions - The company completed the sale of Bonum Health, LLC on April 30, 2025, as part of its strategy to dispose of legacy subsidiaries[24] - The company completed the acquisition of Scienture, Inc. on July 25, 2024, with a total purchase consideration of $78,646,184, including 291,536 shares of common stock and 6,826,753 shares of Series X Preferred Stock[76] - The divestiture of IPS, Softell, and Bonum Health, Inc. was completed on April 30, 2025, for a total consideration of $5 million[177] - The company is exploring strategic business development opportunities, including in-licensing and co-promotion partnerships[184] Research and Development - The company has initiated the intellectual property application process for its pharmaceutical products since November 2019, indicating ongoing R&D efforts[25] - SCN-102 received regulatory approval in March 2025, with commercialization expected to begin in 2025[99] - The company plans to initiate a Phase 1 single dose study for SCN-104 in healthy adults in 2026, pending FDA clearance of the IND[195] - The company anticipates submitting an IND for SCN-107 in 2025, with at least one Phase 3 clinical trial required for marketing application[202] Financial Concerns - The company has substantial doubt about its ability to continue as a going concern unless additional financing is obtained within the next 12 months[74] - The company has not recognized any income tax provision for the three and six months ended June 30, 2025, due to the utilization of net operating loss carryforwards[67] - The company is evaluating the impact of recently issued accounting standards but does not expect them to materially affect its financial position or results of operations[70] Operational Expenses - Operating expenses increased significantly to $5,157,906 for the three months ended June 30, 2025, compared to $1,494,988 for the same period in 2024, reflecting a rise of approximately 245.5%[17] - Total operating lease expense for the three months ended June 30, 2025, was $22,795, compared to $12,841 for the same period in 2024[158] Debt and Financing - The Company recognized a total debt discount of $3,333,333 related to the First Closing Debentures, with $485,523 and $965,709 amortized to interest expense during the three and six months ended June 30, 2025, respectively[107] - The Company entered into a Loan and Security Agreement for $2,000,000 with an interest rate of 15.50%, with principal repayable in September 2025[113] - The Company has a convertible note of $360,000 issued in August 2024, requiring monthly payments of $7,200 towards repayment, with a maturity date of August 20, 2025[114]