UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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 June 30, 2025

☐ 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: 001-41340

KLOTHO NEUROSCIENCES, INC.

(Exact name of registrant as specified in its charter)

Delaware		86-2727441
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1300 South Boulevard, Unit D

Charlotte, NC 28203

(Address of principal executive offices) (Zip Code)

(833) 931-6330

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	KLTO	The Nasdaq Stock Market LLC
Warrants	KLTOW	The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 15, 2025, there were 61,374,435 shares of the registrant’s common stock, $0.0001 par value, issued and outstanding.

KLOTHO NEUROSCIENCES, INC.

FORM 10-Q FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2025

TABLE OF CONTENTS

		Page

PART I. FINANCIAL INFORMATION		1

ITEM 1.	Financial Statements	1

	Condensed Consolidated Balance Sheets at June 30, 2025 (Unaudited) and December 31, 2024	1

	Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2025 and 2024	2

	Unaudited Condensed Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the Three and Six Months Ended June 30, 2025 and 2024	3

	Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2025 and 2024	4

	Notes to Unaudited Condensed Consolidated Financial Statements	5

ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	24

ITEM 4.	Controls and Procedures	25

PART II. OTHER INFORMATION		26

ITEM 1.	Legal Proceedings	26

ITEM 1A.	Risk Factors	26

ITEM 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	26

ITEM 3.	Defaults Upon Senior Securities	26

ITEM 4.	Mine Safety Disclosures	26

ITEM 5.	Other Information	26

ITEM 6.	Exhibits	26

SIGNATURES		27

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

KLOTHO NEUROSCIENCES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

	June 30, 2025			December 31, 2024
	(Unaudited)

ASSETS
Current assets:
Cash and cash equivalents	$	8,430,946		$	63,741
Prepaid expenses		115,386			94,070
Total current assets		8,546,332			157,811

Other assets:
Licenses		2,251,134			2,251,134
Patents		48,420			48,420
Total other assets		2,299,554			2,299,554
Total assets	$	10,845,886		$	2,457,365

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	12,631		$	63,686
Accrued expenses		50,331			912,095
Notes payable to related parties		-			31,000
Notes payable		-			240,753
Total current liabilities		62,962			1,247,534
Warrant liability		132,447			24,486
Total liabilities		195,409			1,272,020

Commitments and contingencies (Note 10)

STOCKHOLDERS’ EQUITY
Preferred stock, par value $0.0001, 100,000,000 shares authorized; 500 and 0 issued and outstanding as of June 30, 2025 and December 31, 2024, respectively		-			-
Common stock, par value $0.0001, 1,000,000,000 shares authorized; 52,703,070 and 27,080,915 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively		5,270			2,708
Additional paid-in capital		27,535,219			11,745,436
Accumulated deficit		(16,890,012	)		(10,562,799	)
Total stockholders’ equity		10,650,477			1,185,345
Total liabilities and stockholders’ equity	$	10,845,886		$	2,457,365

See accompanying notes to the unaudited condensed consolidated financial statements.

KLOTHO NEUROSCIENCES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2025			2024			2025			2024

Operating expenses:
Professional fees	$	924,580		$	355,752		$	1,661,266		$	731,348
General and administrative		339,377			2,341			694,159			48,790
Research and development		238,700			-			238,700			-
Share-based compensation		390,195			37,514			885,695			37,514
Total operating expenses		1,892,852			395,607			3,479,820			817,652

Net operating loss		(1,892,852	)		(395,607	)		(3,479,820	)		(817,652	)

Other income (expense):
Interest Expense		(1,760,025	)		(15,064	)		(2,313,962	)		(15,064	)
Change in fair value of warrant liability		(121,476	)		(39,697	)		(107,961	)		(39,697	)
Loss on conversion of debt		(331,546	)		-			(448,802	)		-
Other income (expense)		12,668			(1,271	)		23,332			(251,270	)
Total other income (expense)		(2,200,379	)		(56,032	)		(2,847,393	)		(306,031	)

Net loss before income taxes		(4,093,231	)		(451,639	)		(6,327,213	)		(1,123,683	)
Income taxes		-			-			-			-
Net loss	$	(4,093,231	)	$	(451,639	)	$	(6,327,213	)	$	(1,123,683	)

Net loss per share: Basic and Diluted	$	(0.12	)	$	(0.03	)	$	(0.21	)	$	(0.07	)
Weighted average common shares outstanding		33,952,418			15,678,898			30,755,807			15,678,898

See accompanying notes to the unaudited condensed consolidated financial statements.

KLOTHO NEUROSCIENCES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)

	Common Stock				Preferred Stock (Series B, C and D)						Additional Paid-in			Common Stock		Accumulated			Total Stockholder’s Equity
	Shares		Amount		Shares			Amount			Capital			to be Issued		Deficit			(Deficit)


Balance, January 1, 2024*		15,130,393	$	1,513		120,000		$	120		$	4,493,881			-		(3,923,677	)		571,837
Share-based compensation		-		-		-		$	-		$	287,251			-		-			287,251
Cancelled preferred B shares		-		-		(30,000	)	$	(30	)	$	(38,370	)		-		-			(38,400	)
Stock dividends		-		-		-		$	-		$	-			-		(1,911	)		(1,911	)
Adjustment from reverse merger application*		-		-		-		$	-		$	213,280			-		-			213,280
Net loss		-		-		-		$	-		$	-			-		(672,044	)		(672,044	)
Balance at March 31, 2024*		15,130,393	$	1,513	$	90,000		$	90		$	4,956,042		$	-	$	(4,597,632	)	$	360,013
Share-based compensation		-		-		-			-			37,252			262		-			37,514
Adjustment from reverse merger application*		548,505		55		(90,000	)	$	(90	)	$	(1,780,834	)		304,200		1,911			(1,474,758	)
Public warrants assumed from SPAC		-		-		-			-			488,750			-		(488,750	)		-
Private warrants assumed from SPAC		-		-		-			-			(22,525	)		-		-			(22,525	)
Net loss		-		-		-			-			-			-		(451,639	)		(451,639	)
Balance at June 30, 2024		15,678,898	$	1,568		-		$	-		$	3,678,685		$	304,462	$	(5,536,110	)	$	(1,551,395	)

Balance, January 1, 2025		27,080,915	$	2,708		-		$	-		$	11,745,436			-	$	(10,562,799	)	$	1,185,345
Share-based compensation		-		-		-			-			495,500			-		-			495,500
Issuance of shares for note payable conversions		1,429,717		143		-			-			466,026			-		-			466,169
Issuance of equity warrants in connection with convertible debt		-		-		-			-			679,577			-		-			679,577
Termination of shares issued during merger under FPA agreement		-		-		-			-			46,100			-		-			46,100
Net loss		-		-		-			-			-			-		(2,233,982	)		(2,233,982	)
Balance at March 31, 2025		28,510,632	$	2,851		-		$	-		$	13,432,639		$	-	$	(12,796,781	)	$	638,709
Share-based compensation		400,000		40		-			-			390,155			-		-			390,155
Issuance of common shares in connection with note conversions		6,583,757		658		-			-			1,225,455			-		-			1,226,113
Issuance of common shares in connection with warrant exercises		10,958,681		1,096		-			-			12,924,033			-		-			12,925,129
Issuance of common shares in connection with stock subscriptions		6,250,000		625		-			-			499,375			-		-			500,000
Termination of shares issued during merger under FPA agreement		-		-		-			-			94,472			-		-			94,472
Issuance of Preferred B stock for cash		-		-		500			-			500,000			-		-			500,000
Deemed dividend - warrant modification		-		-		-			-			(1,530,910	)		-		0			(1,530,910	)
Net loss		-		-		-			-			-			-		(4,093,231	)		(4,093,231	)
Balance at June 30, 2025		52,703,070	$	5,270		500		$	-		$	27,535,219		$	-	$	(16,890,012	)	$	10,650,477

*	Note: as a result of the business combination as recast, the shares of the Company’s common stock prior to the Business Combination (refer to Note 1) have been retrospectively recast to reflect the change in the capital structure as a result of the Business Combination on 6/21/24.

See accompanying notes to the unaudited condensed consolidated financial statements.

KLOTHO NEUROSCIENCES, INC.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

	For the Six Months Ended June 30,
	2025			2024

CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(6,327,213	)	$	(1,123,683	)
Adjustments to reconcile net loss to net cash used in operating activities:
Changes in fair value of warrant liability		107,961			39,697
Commitment fee		-			250,000
Interest expense		2,285,080			-
Loss on conversion of note payable		448,802			-
Share-based compensation		885,695			37,514
Changes in operating assets and liabilities:
Prepaid expenses		21,316			(150,660	)
Accounts payable		(51,055	)		(117,271	)
Accrued expenses		(861,764	)		247,940
Related party payable		(31,000	)		(128,000	)
Other Liabilities		-			15,064
Net cash used in operating activities	$	(3,522,178	)	$	(929,399	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of drug license		-			(123,497	)
Net cash used in (provided by) investing activities	$	-		$	(123,497	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from convertible promissory note, net of issuance cost		2,150,000			950,000
Proceeds from sales of stocks and warrants, net		11,394,218			175,000
Proceeds from stock subscriptions		500,000			-
Proceeds from sale of preferred B shares		500,000			-
Payments on notes payable		(2,730,182	)		-
Payments for deferred financing costs		(25,000	)		-
Proceeds from FPA settlement		140,572			-
Payments on financed director and officer insurance		(40,225	)		-
Merger proceeds net of transaction cost		-			770,424
Net cash provided by financing activities	$	11,889,383		$	1,895,424

NET CHANGE IN CASH		8,367,205			842,528
Cash - Beginning of period		63,741			2,808
Cash - End of period	$	8,430,946		$	845,336

SUPPLEMENTAL NON-CASH FINANCING AND INVESTING ACTIVITIES:
Note payable settled with issuance of common stock	$	1,473,441		$	1,308,270
Reversal of OID		681,506			-
Non-cash directors and officers insurance		-		$	154,500
Non-cash PIPE Funds used for merger transaction close		-		$	2,950,000
Commitment fee paid in stock		-		$	250,000
Assumed income tax payable from merger		-		$	568,111
Assumed warrant liability from merger		-		$	22,525
Interest payable settled with issuance of common stock		57,641		$	-
Issuance of warrants		679,577		$	-
Repurchase of warrants		(679,577	)	$	-

SUPPLEMENTAL CASH FLOW INFORMATION:
Interest Paid	$	79,153		$	2,460
Taxes Paid	$	-		$	-

See accompanying notes to the unaudited condensed consolidated financial statements.

KLOTHO NEUROSCIENCES, INC.

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 — ORGANIZATION AND BUSINESS DESCRIPTION

Klotho Neurosciences, Inc. (“The Company” or “Klotho”), formerly known as ANEW Medical, Inc., develops essential medicines for the treatment of chronic diseases – cancer, cardiovascular, and neurodegenerative disorders. The Company currently has acquired two licensed platforms: a generic drug portfolio and a biosimilar biologics platform that uses biologic therapies to treat cancer, and a proprietary, patented gene therapy platform that uses a gene therapy approach to introduce a therapeutic protein called “Klotho” inside the body to treat neurodegenerative diseases.

On September 12, 2022, the Company acquired five market-approved anti-cancer drugs approved for sale in Germany. The Market Authorizations (MA’s) are for four of the drugs that comprise the “FOLFOX” and “FOLFIRI” multi-drug regimens used in treatment of metastatic colorectal and gastric cancer and in two of the drugs that are used to treat metastatic lung cancer. The drugs are important in the treatment of many solid tumors in both childhood and adult cancers. Previously, the Company acquired two off-patent bio generic antibodies from Reliance Life Sciences (RLS), the life science arm of Reliance Industries Pvt Ltd. of Navi Mumbai, India.

Effective July 24, 2024, the Company changed its legal name from ANEW Medical, Inc. to Klotho Neurosciences, Inc. This name change was approved by the Company’s Board of Directors to better reflect the strategic focus of its proprietary products. Throughout these financial statements, references to the “Company” refer to Klotho Neurosciences, Inc., formerly known as ANEW Medical, Inc (ANEW). Under certain circumstances, references to ANEW have remained useful when describing the sequence of events that occurred during the merger between Redwoods and ANEW.

Business Combinations

As of May 30, 2023, Redwoods Acquisition Corp., a Delaware corporation and a special purpose acquisition company (“Redwoods”), ANEW Medical Sub, Inc., a Wyoming corporation (“Merger Sub”) and ANEW Medical, Inc., a Wyoming corporation (“ANEW”) entered into a Business Combination Agreement, which was amended as of November 4, 2023 (the “Business Combination Agreement”). On June 21, 2024 (the “Closing Date”), Merger Sub merged with and into ANEW, with ANEW continuing as the surviving corporation and as a wholly owned subsidiary of Redwoods (the “Business Combination”). In connection with the Business Combination, on June 21, 2024, Redwoods filed its Second Amended Certificate of Incorporation with the Delaware Secretary of State and adopted the amended and restated bylaws (the “Amended and Restated Bylaws”), which replaced Redwoods’ Charter and Bylaws in effect as of such time. In connection with the closing of the Business Combination (the “Closing”), Redwoods changed its name to “ANEW Medical, Inc.”

For accounting purposes, the transactions contemplated by the Business Combination are treated as a reverse acquisition and, as such, the historical financial statements of the accounting acquirer ANEW (Wyoming) will become the historical financial statements of the Company. Under this method of accounting, Redwoods was treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the Merger was treated as the equivalent of the Company issuing shares for the net assets of Redwoods, accompanied by a recapitalization. The net assets of Redwoods were stated at historical cost with no goodwill or other intangible assets recorded.

Recapitalization

In connection with the merger, the Company issued six million shares in exchange for all the outstanding shares of ANEW. At $10 per Redwood’s share, the valuation of ANEW was $60 million.

Immediately after giving effect to the Business Combination, 15,130,393 shares of Company Common Stock were outstanding, from which 2,875,000 remained in escrow for the Redwoods founders. In addition, there were 12,030,000 warrants immediately exercisable and composed of 11,500,000 public warrants and 530,000 private warrants. Following the Closing, on June 21, 2024, the Company’s Common Stock and Warrants began trading on the Nasdaq under the symbols “WENA” and “WENAW,” respectively. The Public Units of Redwoods automatically separated into the component securities upon consummation of the Business Combination and, as a result, no longer trade as a separate security. Further, upon the closing of the Business Combination on June 21, 2024, the Company received approximately $181,339 in net cash proceeds.

At Closing, pursuant to the terms of the Business Combination Agreement and after giving effect to the redemptions of shares of Redwoods Common Stock:

●

The total consideration paid at Closing (the “Merger Consideration”) by Redwoods to ANEW Medical, Inc. security holders was 6,000,000 shares of the Company common stock valued at $60 million (the “Consideration Shares”), based on an implied ANEW equity value of $60,000,000 valued at $10 per share;

●

Each share of ANEW Medical Common Stock, if any, that was owned by Redwoods, Merger Sub, ANEW Medical, Inc. or any other affiliate of Redwoods immediately prior to the effective time of the Merger (the “Effective Time”) was automatically cancelled and retired without any conversion or consideration;

●

Each share of Merger Sub common stock, par value $0.0001 per share (“Merger Sub Common Stock”), issued and outstanding immediately prior to the Effective Time was converted into one newly issued share of Common Stock of the Surviving Corporation.

In connection with the Merger, the Company entered into a convertible promissory note and Securities Purchase Agreement (“SPA”) with certain accredited investors (the “Redwoods PIPE Investors”) for an aggregate of 750,000 shares (bonus free trading shares and restricted shares issued at closing), with each unit consisting of one share of Company common stock (the “PIPE Shares”) for an aggregate purchase price of $2,000,000 (the “Redwoods PIPE Financing”). Upon the closing of the Redwoods PIPE Financing (which closed in connection with the closing of the Merger), the $2,000,000 were used by the Company to settle transaction costs. The Company received approximately $181,339 in net cash proceeds and recorded a receivable of $50,000 from the Redwoods PIPE Financing funds. The $2,000,000 note has been converted into shares and considered as paid in full as of December 31, 2024.

In connection with the Merger, the Company entered convertible promissory note and Securities Purchase Agreement (“SPA”) with certain accredited investors (the “ANEW PIPE Investors”) for an aggregate of 854,257 units (bonus free trading shares and restricted shares issued at closing), with each unit consisting of one share of Company common stock (the “PIPE Shares”) for an aggregate purchase price of $2,000,000 (the “ANEW PIPE Financing”). Upon the closing of the ANEW PIPE Financing (which closed in connection with the closing of the Merger), $1,000,000 was used by the Company to settle transaction costs. The Company received approximately $950,000 in cash proceeds and recorded a receivable of $50,000 from the ANEW PIPE Financing funds. The $2,000,000 note has been converted into shares and considered as paid in full as of December 31, 2024.

Certain ANEW stockholders may be entitled to up to an additional 2,000,000 shares of Company Common Stock (the “Contingent Consideration Shares”), upon the following conditions being met:

(i)

1,000,000 Contingent Consideration Shares upon the Company’s common stock achieving a closing price equal to or exceeding $15.00 for 10 trading days within a 20-day trading period in the first three years following the Closing; and

(ii)

1,000,000 Contingent Consideration Shares upon the Company’s common stock achieving a closing price equal to or exceeding $20.00 for 10 trading days within a 20-day trading period in the first five years following the Closing.

In accordance with guidance applicable to these circumstances, the equity structure has been restated in all comparable periods up to June 21, 2024 and reflected as such as of December 31, 2024, to reflect the number of shares of the Company’s common stock, $0.0001 par value per share, issued to ANEW’s stockholders in connection with the merger. As such, the shares and corresponding capital amounts and earnings per share related to ANEW’s common stock prior to the merger have been retroactively restated as shares reflecting the exchange ratio established in the merger.

For accounting purposes, the Merger was treated as the equivalent of the Company issuing shares for the net assets of Redwoods, accompanied by a recapitalization. The net assets of Redwoods were stated at historical cost with no goodwill or other intangible assets recorded. In connection with the Merger, in addition to the warrants, ANEW Medical assumed $589,081 in cash and $568,111 in income tax payable. The income tax payable of $568,111 was settled in full as of December 31, 2024 from the assumed $589,081 cash.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Going Concern

The accompanying unaudited condensed consolidated financial statements have been prepared as if the Company will continue as a going concern. The Company has incurred significant operating losses and negative cash flows from operations since inception. As of June 30, 2025, the Company had cash of approximately $8.4 million and an accumulated deficit of approximately $16.9 million. The Company has incurred recurring losses, has experienced recurring negative operating cash flows, and requires significant cash resources to execute its business plans. The Company is dependent on obtaining additional working capital funding from the sale of equity and/or debt securities in order to continue to execute its development plans and continue operations. Without additional funding, there is substantial doubt about the Company’s ability to continue as a going concern for twelve months from the date of these financial statements.

Basis of Presentation and Principles of Consolidation

The Company prepares its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the SEC. The Company prepared the Financial Statements, without audit, pursuant to the rules and regulations of the SEC applicable to quarterly reporting on Form 10-Q and reflect, in management’s opinion, all adjustments necessary to present fairly the financial information. All such adjustments are of a normal recurring nature. Certain information and footnote disclosures normally included in financial statements, prepared in accordance with generally accepted accounting principles, have been consolidated or omitted as permitted by such rules and regulations. These Financial Statements should be read in conjunction with the consolidated financial statements and related notes included in the 2024 Annual Report. Results of operations for interim periods are not necessarily indicative of annual results.

Reclassification

Certain prior year amounts have been reclassified for comparative purposes to conform to the current-year financial statement presentation. These reclassifications had no effect on previously reported results of operations and were not material.

Emerging Growth Company

The Company is an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”), as modified by the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), and it may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in its periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. Further, Section 102(b)(1) of the JOBS Act exempts emerging growth companies from being required to comply with new or revised financial accounting standards until private companies (that is, those that have not had a Securities Act registration statement declared effective or do not have a class of securities registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) are required to comply with the new or revised financial accounting standards. The JOBS Act provides that a company can elect to opt out of the extended transition period and comply with the requirements that apply to non-emerging growth companies but any such election to opt out is irrevocable. The Company has elected not to opt out of such extended transition period which means that when a standard is issued or revised and it has different application dates for public or private companies, the Company, as an emerging growth company, can adopt the new or revised standard at the time private companies adopt the new or revised standard. This may make comparison of the Company’s financial statements with another public company which is neither an emerging growth company nor an emerging growth company which has opted out of using the extended transition period difficult or impossible because of the potential differences in accounting standards used.

Use of Estimates

The preparation of unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires the Company’s management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statements, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from those estimates.

Cash and Cash Equivalents

Cash and cash equivalents represent cash on hand, demand deposits, and other short-term highly liquid investments placed with banks, which have original maturities of three months or less and are readily convertible to known amounts of cash.

Concentration of Credit Risk

Financial instruments that potentially subject the Company to concentrations of credit risk consist of a cash account in a financial institution, which, at times, may exceed the Federal Depository Insurance Coverage of $250,000. As of June 30, 2025, the Company has not experienced losses on this account and management believes the Company is not exposed to significant risks on such account.

Fair Value of Financial Instruments

The assets and liabilities are valued using a fair market basis as defined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) ASC 820, Fair Value Measurement. Fair value is the price the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. The Company uses a three-level hierarchy established by the FASB that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach and cost approach). The levels of the fair value hierarchy are described below:

	Level 1:	Quoted prices in active markets for identical assets or liabilities.

	Level 2:	Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

	Level 3:	Unobservable inputs with little or no market data available, which require the reporting entity to develop its own assumptions.

The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Financial assets and liabilities are classified in their entirety based on the most conservative level of input that is significant to the fair value measurement.

	Fair value measurements at reporting date using:
	Fair value		Quoted prices in active markets for identical assets or liabilities (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Cash equivalents, June 30, 2025	$	8,257,103	$	8,257,103	$	-	$	-
Cash equivalents, December 31, 2024	$	-	$	-	$	-	$	-

Liabilities:
Representative warrant liabilities, June 30, 2025	$	132,447	$	-	$	-	$	132,447

Liabilities:
Representative warrant liabilities, December 31, 2024	$	24,486	$	-	$	-	$	24,486

The following tables present a reconciliation of the Level 3 Representative Warrants liabilities:

	Three Months Ended June 30,
	2025		2024
Representative warrant liabilities, April 1	$	10,971	$	-
Change in fair value		121,476		-
Representative warrant liabilities, June 30	$	132,447	$	-

	Six Months Ended June 30,
	2025		2024
Representative warrant liabilities, January 1	$	24,486	$	-
Change in fair value		107,961		-
Representative warrant liabilities, June 30	$	132,447	$	-

Intangible Assets

The Company’s intangible assets consist of acquired medical licenses and patents.

The Company acquires medical licenses for the treatment of medical conditions to market and sell in the future. The initial asset cost is the cost to acquire the license. Once in use, the Company amortizes the license cost over the useful life using the straight-line method. As part of the licensing agreements, the Company acquires patents and records the cost to acquire patents as the initial asset cost. Once the patents are approved and in use, assuming no litigation expenses, the Company amortizes the patent cost over the useful life using the straight-line method. The amortization period will not exceed the lifespan of the protection afforded by the patent. If the expected useful life of the patent is even shorter, the Company will use the useful life for amortization purposes. Thus, the shorter of a patent’s useful life or legal life will be used for the amortization period.

Impairment of Long-Lived and Intangible Assets

The Company assesses the impairment of long-lived and intangible assets periodically, or at least annually, and whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors considered important, which could trigger an impairment review, include the following: significant underperformance relative to historical or projected future cash flows; significant changes in the manner of use of the assets or the strategy of the overall business; and significant negative industry trends. When management determines that the carrying value of long-lived and intangible assets may not be recoverable, impairment is measured as the excess of the assets’ carrying value over the estimated fair value. Management is not aware of any other impairment charges that may currently be required; however, the Company cannot predict the occurrence of events that might adversely affect the reported values in the future. On an annual basis, the Company tests the long-lived and intangible assets for impairment based on the projected net present value of cash flows for each asset. Prior to the annual impairment test, if circumstances change and a long-lived or intangible asset is deemed impaired, an impairment loss will be immediately recognized in the statements of operations. At December 31, 2024, the date of the last impairment test, the Company determined that the license related to Teleost Biopharmaceutic, LLC was impaired and recognized an impairment expense of $10,000 as of December 31, 2024. The Company determined that the estimated fair value of all other intangible assets exceeded their carrying value, indicating no impairment.

Revenue Recognition

The Company is in a pre-revenue state and does not generate revenue. When the Company commences to derive revenue, those contracts will be accounted in accordance with ASU 2014-09, Revenue from Contracts with Customers (Topic ASC 606).

Income Taxes

The Company uses the asset and liability method of accounting for income taxes in accordance with ASU 740, “Income Taxes”. Under this method, income tax expense is recognized as the amount of: (i) taxes payable or refundable for the current year and (ii) future tax consequences attributable to differences between the consolidated financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of available evidence it is more likely than not that some portion or all of the deferred tax assets will not be realized.

The Company is subject to Income tax filings requirements in U.S. federal and various state jurisdictions. The Company’s tax returns for years from 2022, 2023 and 2024 are subject to U.S. federal, state, and local income tax examinations by tax authorities.

The Company reports income tax related interest and penalties within the income tax line item on the consolidated statements of operations. The Company likewise reports the reversal of income tax-related interest and penalties within such line item to the extent the Company resolves the liabilities for uncertain tax positions in a manner favorable to the accruals.

Net Loss Per Share (Basic and Diluted)

Basic net loss per share is computed by dividing net loss by the weighted average number of shares outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares outstanding, plus the number of additional shares that would have been outstanding if the common share equivalents had been issued, if dilutive.

The following table details the net loss per share calculation, reconciles between basic and diluted weighted average shares outstanding, and presents the potentially dilutive shares that are excluded from the calculation of the weighted average diluted common shares outstanding, because their inclusion would have been anti-dilutive:

	For the Three Months Ended						For the Six Months Ended
	June 30,						June 30,
	2025			2024			2025			2024
Numerator:

Net loss	$	(4,093,231	)	$	(451,639	)	$	(6,327,213	)	$	(1,123,683	)

Weighted-average common shares outstanding, basic and diluted		33,952,418			15,678,898			30,755,807			15,678,898

Basic and diluted loss per share	$	(0.12	)	$	(0.03	)	$	(0.21	)	$	(0.07	)

The following common share equivalents are excluded from the calculation of weighted average common shares outstanding, because their inclusion would have been anti-dilutive:

	As of June 30,
	2025		2024
Warrants		5,071,319		12,030,000
Preferred Shares B		6,250,000		-
Total potentially dilutive shares		11,321,319		12,030,000

Research and Development Cost

Research and development (R&D) costs are expensed as incurred. R&D costs are related to the Company’s internally funded development of the Company medical licenses and patents. The Company R&D costs were $238,700 and $0 for the three and six months ended June 30, 2025 and 2024, respectively.

Share-based Compensation

The Company accounts for share-based compensation in accordance with the fair value recognition provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 718 and No. 505. The Company issues restricted stock and stock options to employees and consultants for their services. Costs for these transactions are measured at the fair value of the equity instruments issued at the date of grant. These shares are considered fully vested and the fair market value is recognized as an expense in the period granted. The Company recognized consulting expenses and a corresponding increase to additional paid-in-capital related to stock issued for services. For agreements requiring future services, the consulting expense is to be recognized ratably over the requisite service period.

The Company recorded share-based compensation of $390,195 and $37,514 for the three months ended June 30, 2025, and 2024, respectively. The Company recorded share-based compensation of $885,695, and $37,514 for the six months ended June 30, 2025 and 2024, respectively.

Warrants

As of June 30, 2025, the fair value of the Representative Warrant liabilities was $132,447 based on the closing price of the warrants on The Nasdaq Capital Market. The fair value of the Representative Warrants was approximately $0.25 per Representative Warrant as of June 30, 2025, which was based on the relative fair value to the Public Warrants. During the three months ended June 30, 2025, the fair value of the Representative warrants increased by $121,476. During the six months ended June 30, 2025, the fair value of the Representative warrants increased by $107,961.

Related Parties

The Company follows subtopic 850-10 of the FASB Accounting Standards Codification for the identification of related parties and disclosure of related party transactions.

Pursuant to Section 850-10-20 the related parties include (a) affiliates of the Company; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; (e) management of the Company; (f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

Segment Information

Operating segments are defined as components of an enterprise for which separate discrete information is available for evaluation by the Chief Operating Decision Maker (“CODM”) or decision-making group in deciding how to allocate resources and in assessing performance. The Company views its operations and manages its business as one operating and reporting segment, which is the business of research and development of essential medicines for the treatment of chronic diseases – cancer, cardiovascular, and neurodegenerative disorders. See Note 11 Segment Information for additional information.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses, which requires entities to estimate all expected credit losses for financial assets measured at amortized cost basis, including trade receivables, held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. The Company adopted this guidance on January 1, 2023. The adoption of this accounting standard did not have an impact on the Company’s consolidated financial statements as the Company is in a pre-revenue state and does not generate revenue and has no receivables from third party.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which requires incremental disclosure of segment information on an interim and annual basis. This ASU is effective for public entities for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. Retrospective application to all prior periods presented in the financial statements is required for public entities. The Company adopted ASU 2023-07 as of January 1, 2024, which resulted in additional disclosures of significant segment expenses and other segment items as well as incremental qualitative disclosures.

NOTE 3 — PREPAID EXPENSES

Prepaid expenses consist of prepayment of the premium on Directors and Officers insurance, NASDAQ annual fees, association membership fees, and Delaware franchise taxes. As of June 30, 2025 and December 31, 2024, prepaid expenses totaled $115,386 and $94,070, respectively, in the accompanying condensed consolidated balance sheets.

NOTE 4 — INTANGIBLE ASSETS

Intangible assets consisted of the following:

Intangible Assets	June 30, 2025		December 31, 2024
Licenses
Non-Exclusive License Agreement	$	179,821	$	179,821
Various generic drugs		736,983		736,983
Four generic drugs (Encore)		1,308,270		1,308,270
Needleless Syringe License		26,060		26,060
Patents		48,420		48,420
Total intangible assets	$	2,299,554	$	2,299,554

Intangible assets are as follows:

●

Non-Exclusive License Agreement ($179,821) – On March 5, 2023, the Company signed a Non-Exclusive License Agreement with Heidelberg University to grant non-exclusive rights to various licenses owned and under development by the university. The licenses include the use of modified AAV capsid polypeptides for treatment of muscular diseases. The terms include a €50,000 ($56,325) fee for signing the agreement and €100,000 ($112,650) payment within 60 days of the anniversary of signing the agreement. The Company will pay €1,000,000 ($1,126,500) for each assignment of a right to a license owned by the university. For new licenses, the Company will make standard commercial development-based milestone payments for the various stages of license development and regulatory approval. The Company will make 2% royalty payments by January 31^st each year during the term of the agreement for each licensed product for the proceeding calendar year. The value of the licenses was $179,821 at June 30, 2025 and December 31, 2024, respectively.

●

Various Generic Drugs ($736,983) - During 2015, the Company acquired two licenses for biosimilar biologic therapies to treat cancer and autoimmune diseases. The value of the licenses was $736,983 at June 30, 2025 and December 31, 2024, respectively.

●

Four Generic Drugs (Encore) ($1,308,270) – On September 12, 2022, the Company acquired four market-approved anti-cancer drugs approved for sale in Germany for $1,308,270. The purchase price represents the fair value of the intangible asset based on the net present value of the projected gross profit to be generated by the licenses. The value of the licenses was $1,308,270 at June 30, 2025 and December 31, 2024.

●

Needleless Syringe License ($26,060) – On December 1, 2023, the Company signed a license agreement with TransferTech Sherbooke for the rights to develop and commercialize the technology of a “Needleless Syringe.” Under the terms of the agreement, the Company paid a $26,060 upfront fee and royalty fees on the license income. The Company has not commenced developing the technology. The amount paid under the agreement is $26,060 at June 30, 2025 and December 31, 2024, respectively.

●

Patents ($48,420) – Through its licensing arrangements, the Company acquires the right to patents for Alzheimer, ALS, and other items. Once the patents are declared effective, patents are amortized using the straight-line method over their estimated useful lives or statutory lives, whichever is shorter, and will be reviewed for impairment upon any triggering event that may impact the assets’ ultimate recoverability as prescribed under the guidance related to impairment of long-lived assets. Costs incurred to acquire patents, including legal costs, are also capitalized as long-lived assets and amortized on a straight-line basis with the associated patent. The patent value, which is part of licenses in the accompanying condensed consolidated balance sheet, as of June 30, 2025 and December 31, 2024, was $48,420, respectively.

●

Exclusive World-wide License Agreement - On January 24, 2022, the Company signed an exclusive, world-wide License Agreement with the University of Barcelona for a cell and/or gene therapy that has shown compelling activity in animal models of human Alzheimer’s disease and amyotrophic lateral sclerosis (“ALS” or “Lou Gehrig’s disease”). The gene therapy will also be applied to age-related diseases and rare (“Orphan”) diseases. Beginning on December 15, 2022, the annual license fee is 10,000 Euros. In addition, the Company will pay a Royalty equal to 3% of net sales of finished products once the license is in use. As of June 30, 2025 and December 31, 2024, the Company owed $0 under the agreement.

These licenses and patents are not currently in use as the Company is in pre-revenue stage. Once these licenses are in use, the licenses will be amortized over its useful life. The Company expects to utilize these licenses and patents later in the year.

NOTE 5 — ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses consist of professional fees. The accounts payable and accrued expenses as of June 30, 2025 and December 31, 2024 were $62,962 and $975,781, respectively, in the accompanying condensed consolidated balance sheet.

NOTE 6 — NOTES PAYABLE TO RELATED PARTIES

Notes payable to related parties consisted of the following:

	June 30, 2025		December 31, 2024

May 2024 and December 2023 - $7,000 and $24,000 original amount bearing a one-time interest fee of $2,460 due upon demand.		-		31,000
Total notes payable to related parties	$	-	$	31,000

May 2024 and December 2023 ($7,000 and $24,000) – On December 12, 2023, the Company issued a promissory note to a member of management. The promissory note accrued interest at a one-time interest fee of $2,460, which was paid off in full as of June 30, 2025. The unpaid principal balance was $0 and $31,000 at June 30, 2025 and December 31, 2024, respectively.

NOTE 7 — NOTES PAYABLE

Upper Clapton Convertible Promissory Note

On September 12, 2022, the Company issued a $1,308,270 promissory note used to acquire four market-approved anti-cancer drugs. See Note 4 – Intangible Assets for further discussion. The promissory note bore interest at 6% and had a maturity date of June 30, 2023. Pursuant to the agreement, the interest stopped accruing at June 30, 2023. As of December 31, 2023, the Company made interest payments of $78,496 to fully satisfy the interest obligation under the promissory note. The note was converted into the Company’s common shares and fully settled as part of the merger that closed on June 21, 2024. The outstanding principal balance of the note was $0 at June 30, 2025 and December 31, 2024, respectively.

Redwoods PIPE Investor Convertible Promissory Note

On March 4, 2024, in connection with the Merger, Public ANEW entered into a convertible promissory note that bore an interest of 10% and Securities Purchase Agreement (“SPA”) with certain accredited investors (the “Redwoods PIPE Investors”) for an aggregate purchase price of up to $2,000,000 (the “Redwoods PIPE Financing”), which included 750,000 bonus shares of common stock. Upon the closing of the Redwoods PIPE Financing (funded and closed in connection with the closing of the Merger on June 21, 2024), which totaled $1,950,000, of which $1,768,661 was used by the Company to settle transaction costs. The Company received approximately $181,339 in net cash proceeds. The note and related interest were converted into the Company’s common shares and fully settled as of September 30, 2024. The outstanding principal balance as of June 30, 2025 and December 31, 2024 was $0, respectively.

ANEW PIPE Investors Convertible Promissory Note

On April 22, 2024, prior to the closing of the Business Combination Agreement, ANEW Medical (Wyoming) entered into a convertible promissory note that bore an interest of 10% and Securities Purchase Agreement (“SPA”) with certain accredited investors (the “ANEW PIPE Investors”) for an aggregate purchase price of up to $2,000,000 (the “ANEW PIPE Financing”), which included 900,000 bonus shares of common stock. Upon the closing of the ANEW PIPE Financing (funded and closed in connection with the closing of the Merger on June 21, 2024), which totaled $1,950,000 initially, of which $1,000,000 was used by the Company to settle transaction costs. The Company received approximately $1,000,000 in cash proceeds during the years ended December 31, 2024. The note and related interest were converted into the Company’s common shares and fully settled as of September 30, 2024. The outstanding principal balance as of June 30, 2025 and December 31, 2024 was $0, respectively.

Austria Capital LLC Convertible Promissory Note

On December 4, 2024, the Company entered into a convertible promissory note (“the note”) with a principal amount of $1,200,000 pursuant to the terms of a securities purchase agreement by and between the Company, as issuer, and Austria Capital LLC, as investor (“Investor”). The maturity date of the note is December 4, 2025. The note bears no interest, has an original issue discount of $200,000 and deferred financing costs related to legal fees of $73,000. In addition, the note offered the investor an equity inducement of two million shares, which were issued to the Investor and valued at $978,000. The total of the original issue discount, deferred financing costs and equity inducement, exceeded the principal balance by approximately $51,000, which was expensed as an interest expense on the condensed consolidated statements of operations. Total amortization of these costs recognized as contra-liabilities to be presented net with the principal liability on the condensed consolidated balance sheets was $100,000 at December 31, 2024.

At any time after the approval by the Company’s stockholders, at the option of the Investor, the outstanding principal amount of the note or any portion thereof, is convertible into shares of the Company’s common stock at a price of $0.25 per share; provided that no conversions can take place if the Investor then owns more than 4.99% of the number of the shares of the Company’s common stock outstanding. The conversion price is subject to adjustment in connection with certain transactions, including stock splits or combinations and the like.

Pursuant to the terms of the Sale Purchase Agreement, the Company issued to the Investor a total of 2,000,000 shares of the Company’s common stock as an inducement to the Investors to purchase the note. Such shares were issued in reliance upon Section 4(a)(2) of the Securities Act in a transaction not involving any public offering.

The note was paid off in full as of June 30, 2025 and net liability as of June 30, 2025 and December 31, 2024 was approximately $0 and $100,000, respectively.

Red Road Holdings Promissory Note

On December 10, 2024, the Company signed a loan agreement with Red Road Holdings in the amount of $203,324, including guaranteed interest of $21,784. In connection with the note issuance, an original issue discount of $25,040 was recognized as well as deferred financing costs related to legal fees of $6,500. The net liability presented on the condensed consolidated balance sheet was $181,722 as of June 30, 2024 as a result of amortization of $17,515 recognized in interest expense on the condensed consolidated statement of operations for the year ended June 30, 2025. As of June 30, 2025, the net liability presented on the condensed consolidated balance sheet was $0 as the note was paid off in full, including interest expense composed of $21,784 interest, $25,040 original issue discount, and related legal fees of $6,500.

On January 3, 2025, the Company signed a loan agreement with Red Road Holdings in the amount of $137,715, including guaranteed interest of $14,755. In connection with the note issuance, an original issue discount of $16,960 was recognized as well as deferred financing costs related to legal fees of $6,000. The promissory note is due on November 15, 2025. The note is convertible to shares in the event of default. As of June 30, 2025, the net liability presented on the condensed consolidated balance sheet was $0 as the note was paid off in full, including interest expense composed of $14,755 interest, $16,960 original issue discount, and related legal fees of $6,000.

On April 4, 2025, the Company signed a loan agreement with Red Road Holdings in the amount of $106,534, including guaranteed interest of $11,414. In connection with the note issuance, an original issue discount of $13,120 was recognized. as well as deferred financing costs related to legal fees of $7,000. The promissory note is due on January 30, 2026. The note is convertible to shares in the event of default. As of June 30, 2025, the net liability presented on the condensed consolidated balance sheet was $0 as the note was paid off in full, including interest expense composed of $11,414 interest, $13,120 original issue discount, and related legal fees of $7,000.

3i LP Institutional Investor Securities Purchase Agreement

On January 23, 2025 (the “Closing Date”) the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an institutional investor (the “Investor”), pursuant to which the Investor will purchase, for an aggregate purchase price of $2,000,000, two senior convertible promissory notes (the “Notes”) from the Company in the aggregate principal amount of $2,173,914 and two warrants (the “Warrants”) to purchase up to an aggregate of 4,000,000 shares of the Company’s common stock, par value $0.0001 per share, in each case subject to the terms and conditions set forth in the Purchase Agreement. Upon effectiveness of the registration rights agreement (the “Registration Rights Agreement”) executed by the Company and the Investor on the Closing Date, the Company filed a registration statement with the Securities and Exchange Commission (“SEC”) to register the shares of Common Stock issuable to the Investor upon any conversion of the Notes or exercise of the Warrants, within 15 days of the Closing Date. Pursuant to the Purchase Agreement, upon the registration statement being declared effective by the SEC on February 10, 2025, the Investor purchased a second Note in the principal amount of $1,086,957 and a second Warrant exercisable for up to an aggregate of 2,000,000 shares of Common Stock, for an aggregate purchase price of $1,000,000 on February 13, 2025.

The Notes mature on the anniversary of their date of issuance, unless prior thereto there is an event of default, bear interest at a rate of 7% per annum, have an 8% original issuance discount, are an unsecured obligation of the Company and rank equal in right of payment with the Company’s existing indebtedness and senior to any future debt obligations of the Company through the repayment of the Notes. The outstanding principal amount of the Notes or any portion thereof is convertible into shares of Common Stock at a price of $0.25 per share (the “Conversion Price”); provided that no conversions can take place if the Investor then owns more than 4.99% (or up to 9.99% pursuant the terms of the Notes) of the number of the shares of Common Stock outstanding (the “Maximum Percentage”). Further, no conversion can take place, prior to approval by the Company’s stockholders, if such conversion would violate any rule of the Nasdaq Stock Market. The Conversion Price is subject to adjustment in connection with certain transactions, including stock dividends, stock splits or combinations and the like. The Notes contain certain specified events of default, the occurrence of which would entitle the Investor to immediately demand repayment of all outstanding principal such as certain events of bankruptcy, insolvency and reorganization involving the Company.

The Warrants expire five years from their respective dates of issuance. The Warrants were exercisable, at the option of the holder, at any time, for up to an aggregate of 4,000,000 shares of Common Stock of the Company at an exercise price equal to $0.50, subject to adjustment for any stock splits, stock dividends, recapitalizations, and similar events.

On April 30, 2025, the Company made installment payments in cash totaling $232,608 on both 3i Notes or $116,304 for each 3i note, including principal, interest and make whole. The note was paid off in full as of June 30, 2025 and net liability as of June 30, 2025 and December 31, 2024 was approximately $0, respectively.

Conversions

As of June 30, 2025, investors converted convertible promissory notes related to Austria Capital totaling $650,000 through the issuance of 2,600,000 shares of common stock that were issued and outstanding as of June 30, 2025. As of June 30, 2025, investors converted convertible promissory notes related to 3i totaling $881,085 through the issuance of 5,413,474 shares of common stock that were issued and outstanding as of June 30, 2025.

During 2024, investors converted convertible promissory notes totaling $4,010,022, including $3,950,000 of principal and $60,022 accrued interest, through the issuance of 4,050,617 shares of common stock that were issued and outstanding as of December 31, 2024.

NOTE 8 — RELATED PARTIES

On October 24, 2024, Dr. Joseph Sinkule and the Company entered into an Employment Agreement for a term of three years in connection with his appointment as the Company’s Chief Executive Officer. Pursuant to the Employment Agreement, Dr. Sinkule will receive an annual base salary of $360,000 and an initial equity award of 1,000,000 options pursuant to the Company’s 2023 Incentive Plan vesting immediately. The options are valid for a period of three (3) years and have an exercise price equal to the closing price of the Company’s common stock on October 24, 2024. In addition, Dr. Sinkule will be eligible to participate in the Company’s annual bonus program for executives.

On August 15, 2024, Mr. Jeffrey LeBlanc and the Company entered into an Employment Agreement for a term of three years in connection with his appointment as the Company’s Chief Financial Officer, Pursuant to the Employment Agreement, Mr. LeBlanc will receive an annual base salary of $325,000 and an initial equity award of shares of the Company’s common stock of 100,000 shares and an additional equity award of 400,000 shares of the Company’s common stock, with 200,000 of such shares vesting on the first anniversary of the agreement and 200,000 of such shares vesting on the second anniversary of the agreement. In addition, Mr. LeBlanc will be eligible to participate in the Company’s annual bonus program for executives.

On December 12, 2023, the Company issued a promissory note to a member of management. The promissory note accrued interest at a one-time interest fee of $2,460, which was paid off as of September 30, 2024. The unpaid principal balance was $0 and $31,000 at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025 and December 31, 2024, the aggregate related party payable was $0 and $31,000, respectively.

NOTE 9 — STOCKHOLDER’S EQUITY

On June 21, 2024, the Business Combination was completed. The transaction was accounted as a reverse recapitalization in accordance with GAAP. Under this method of accounting, Redwoods was treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the financial statements of the Combined Company represent a continuation of the financial statements of Klotho with the Transactions treated as the equivalent of Klotho issuing shares for the net assets of Redwoods, accompanied by a recapitalization. Accordingly, for accounting purposes, the Merger was treated as the equivalent of the Company issuing shares for the net assets of Redwoods, accompanied by a recapitalization. The net assets of Redwoods were stated at historical cost with no goodwill or other intangible assets recorded. See “NOTE 1 — Organization and Business Description” for detail.

Equity Incentive Plan

In connection with the Business Combination, the Company’s Board adopted, and the Company’s stockholders approved, the Equity Incentive Plan (“Equity Incentive Plan”). Although the Company does not have a formal policy with respect to the grant of equity incentive awards to the Company’s executive officers, the Company believes that equity awards provide Company’s executive officers with a strong link to the Company’s long-term performance, create an ownership culture and help to align the interests of the Company’s executives and the Company’s stockholders. In addition, Company believes that equity awards with a time-based vesting feature promote executive retention because this feature provides incentives to Company’s executive officers to remain in Klotho’s employment during the applicable vesting period. Accordingly, Company’s board of directors periodically reviews the equity incentive compensation of the Company’s executive officers and from time to time may grant equity incentive awards to them.

Warrants

During the three months ended June 30, 2025, the Company initiated a warrant exercise inducement program, reducing the exercise price from $3.49 to $1.35 for certain outstanding warrants. The Company accounted for the inducement as a modification of the original warrants in accordance with ASC 505-10 - Equity. The incremental fair value was recorded as a deemed dividend of $0.3 million in accumulated deficit on the condensed consolidated balance sheets. During the three months ended June 30, 2025, holders of common stock warrants exercised a total of 11.0 million warrants for gross proceeds of $11.4 million.

Austria Note Conversion

During the three months ended June 30, 2025, $650,000 of principal related to the Austria Capital LLC Convertible Promissory Note was converted into 2,600,000 shares of common stock at a conversion price of $0.25. The remainder of the note in the amount of $550,000 was settled in cash. Therefore, the Company de-recognized the remaining unamortized original issue discount of $85,554 and deferred financing costs of $438,471, which were recognized in interest expense on the condensed consolidated statements of operations.

3i Note Conversion

During the six months ended June 30, 2025, $823,444 of principal and $57,641 of interest and make whole related to 3i convertible notes was converted into 5,413,474 shares of common stock at conversion prices ranging from $0.12 to $0.25.

Investor Share Purchase

On June 5, 2025, the Company entered into a securities purchase agreement an accredited investor pursuant to Regulation D of the Securities Act of 1933, as amended. Under the terms of the agreement, the Company issued 6,250,000 shares of its common stock at a purchase price of $0.08 per share, for total gross proceeds of $500,000. The proceeds were allocated to common stock based upon their par value of the common stock and the remainder in recorded to additional paid in capital on the condensed consolidated balance sheets.

Preferred B Shares

On June 9, 2025, the Company conducted a private offering and issued 500 preferred B shares at $0.0001 par value per share for a total of $500,000. The 500 preferred shares are convertible into 6,250,000 common shares.

Meteora Agreement

On June 13, 2024, RWOD and Klotho entered into a forward purchase agreement with (i) Meteora Capital Partners, LP (“MCP”), (ii) Meteora Select Trading Opportunities Master, LP (“MSTO”), and (iii) Meteora Strategic Capital, LLC (“MSC” and, collectively with MCP and MSTO, the “Seller”) (the “Forward Purchase Agreement”). Redwoods is the holder of the asset and Sponsor and is also a counterparty to Klotho. Upon Closing of the merger on June 21, 2024 and on September 30, 2024, the value of the contract was $0 as the contract created no receivable or obligation for the Company. On September 19, 2024, the Company modified the settlement amount price of the contract to $2.00 and allowed the shares held with Meteora to be sold at Meteora’s sole discretion, with the reset price subject to weekly changes. During the quarter ending March 31, 2025, Meteora sold and terminated on behalf of the Company 100,000 shares at a reset price of $0.4610, for total proceeds to Klotho in the amount of $46,100. On May 15, 2025, Meteora terminated additional 550,214 shares at a reset price of $0.1717 for total proceeds of $94,472, thereby reducing the number of shares per the agreement to 10,000 shares remaining.

NOTE 10 — COMMITMENTS AND CONTINGENCIES

From time to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, that arise in the ordinary course of business. Although the outcome of the various legal proceedings and claims cannot be predicted with certainty, management does not believe that any of these proceedings or other claims will have a material effect on the Company’s business, financial condition, results of operations or cash flows.

Termination of acquisition agreement of SB Security Holdings, LLC

On March 26, 2025, the Company entered into a Share Exchange Agreement (the “SEA”) to acquire SB Security Holdings, LLC, a Delaware limited liability company (“SBSH”), which is an internet connected video doorbell service company. Pursuant to the SEA, the Company agreed to purchase all of the issued and outstanding membership interests in SBSH (the “Acquisition”) in exchange for a number of newly issued shares of the Company’s common stock equal to ninety percent (90%) of the total number of issued and outstanding shares of the Company’s common stock, on a fully-diluted basis, as of the closing of the Acquisition. The closing of the Acquisition is subject to customary closing conditions, including mutual agreement as to the legal transaction structure, approval by the Company’s stockholders, and Nasdaq approval. On June 13, 2025, the Company terminated the SEA.

NASDAQ Deficiencies

On August 16, 2024, the Company received two delinquency notification letters (the “Notices”) from the Nasdaq Stock Market LLC (“Nasdaq”) due to the Company’s non-compliance with Nasdaq Listing Rules 5450(b)(2)(C) and 5450(b)(2)(A). The Notices cite the Company’s (a) not being in compliance with the minimum Market Value of Publicly Held Shares (“MVPHS”) requirement as set forth in Nasdaq Listing Rule 5450(b)(2)(C) and (b) not being in compliance with the minimum Market Value of Listed Securities (MVLS) requirement as set forth in Nasdaq Listing Rule 5450(b)(2)(A).

In accordance with Nasdaq Listing Rule 5810(c)(3)(D), the Company has been provided 180 calendar days, or until February 12, 2025, to regain compliance. To regain compliance, prior to February 12, 2025, (a) the Company’s minimum market value of publicly held shares must close at $15,000,000 or more for a minimum of 10 consecutive business days and (b) the Company’s minimum market value of listed securities must close at $50,000,000 or more for a minimum of 10 consecutive business days.

On October 15, 2024, the Company received a delinquency notification letter (the “Notice”) from Nasdaq due to the Company’s non-compliance with Nasdaq Listing Rule 5450(a)(1). The Notice cited the fact that the bid price of the Company’s common stock had closed at less than $1 per share over the previous 30 consecutive business days.

On June 30, 2025, subsequent to a Nasdaq Listing Qualifications Hearing conducted on March 28, 2025, the Company received notice from the Nasdaq Listing Qualifications Panel that the Panel had granted the Company’s request to continue its listing on The Nasdaq Stock Market (“Nasdaq” or the “Exchange”) subject to becoming compliant by August 13, 2025. The Company received a letter of compliance on July 14, 2025.

NOTE 11 — SEGMENT INFORMATION

Operating segments are defined as components of an entity for which separate financial information is available and that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Company operates as a single reporting segment, focused on developing essential medicines for the treatment of chronic diseases – cancer, cardiovascular, and neurodegenerative disorders. The Company currently has acquired two licensed platforms: a generic drug portfolio and a biosimilar biologics platform that uses biologic therapies to treat cancer, and two proprietary, patented technologies involving the melanocortin receptor-binding molecules and a gene therapy platform which uses a gene therapy approach to introduce a therapeutic protein called “Klotho” inside the body to treat neurodegenerative diseases.

The Company’s measure of segment profit or loss is net loss. The CODM is the chief executive officer (“CEO”). The CODM manages and allocates resources to the operations of the Company on a total company basis. Managing and allocating resources on a consolidated basis enables the CEO to assess the overall level of resources available and how to best deploy these resources across functions and research and development projects that are in line with the Company’s long-term company-wide strategic goals. Consistent with this decision-making process, the CEO uses consolidated financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources, and setting incentive targets. Operating expenses are used to monitor budget versus actual results. The CODM also uses net loss in competitive analysis by benchmarking to the Company’s peer group. The competitive analysis along with the monitoring of budgeted versus actual results are used in assessing performance of the segment.

The following table is representative of the significant expense categories regularly provided to the CODM when managing the Company’s single reporting segment. A reconciliation to the consolidated net loss for the periods ended June 30, 2025 and 2024 is included at the bottom of the table below.

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2025		2024		2025		2024
Significant segment expenses
General and administrative⁽¹⁾	$	339,377	$	2,341	$	694,159	$	48,790
Research and development		238,700		-		238,700		-
Professional fees - Licenses and Patents		-		1,502		-		288,416
Professional fees - Other		924,580		354,250		1,661,266		442,932
Share-based compensation expense		390,195		37,514		885,695		37,514
Interest expense (income)		1,760,025		15,064		2,313,962		15,064
Other segment items		318,878		1,271		425,470		251,270
Total operating and segment expenses	$	3,971,755	$	411,942	$	6,219,252	$	1,083,986

Reconciliation of net loss
Change in fair value of warrant liabilities		121,476		39,697		107,961		39,697
Consolidated net loss	$	4,093,231	$	451,639	$	6,327,213	$	1,123,683

1)	Excluding share-based compensation expense

NOTE 12 — SUBSEQUENT EVENTS

The Company has evaluated subsequent events pursuant to the requirements of ASC Topic 855, from the balance sheet date through the date the financial statements were issued, and has determined that the following subsequent event exists:

On July 3, 2025, the U.S. Food and Drug Administration (FDA) granted Orphan Drug Designation to the company’s novel secreted-Klotho (s-KL) promoter, gene and delivery system (KLTO-202, or s-KL-AAV.myo) for the treatment of ALS. The Orphan Drug Designation provides certain incentives to the Company, such as tax credits, toward the cost of human clinical trials and a waiver for the payment of the GDUFA User Fee for market applications. Additionally, Orphan Drug Designation of the product provides developers with seven years of US market exclusivity and independent from the Company’s intellectual property protection.

On July 3, 2025, the Company entered into a sales agreement with A.G.P./Alliance Global Partners (“A.G.P.”) relating to the sale of newly issued shares of the Company’s common stock. In accordance with the terms of the sales agreement, the Company may offer and sell shares of its common stock having an aggregate offering price of up to $50,000,000 from time to time through A.G.P., acting as the Company’s sales agent or principal. The Company intends to use the net proceeds from the offering for working capital and for general corporate purposes.

On July 7, 2025, the Company filed a Form S-3 Registration Statement with the U.S. Securities Exchange Commission (“SEC”) that allows the Company to offer shares of common stock, preferred stock, warrants to purchase common stock or preferred stock, and/or units to purchase any of such securities, either individually or in combination with other securities described in this prospectus, in one or more offerings from time to time, with a total value of up to $100,000,000. The Form S-3 was declared effective on July 25, 2025.

On July 8, 2025, the Board of Directors determined that the Company had met the criteria set forth in the Business Combination Agreement for the release of 2,000,000 contingent shares to the pre-closing stockholders of ANEW Medical. The 2,000,000 shares were issued on August 5, 2025. In addition, the Board of Directors approved the issuance of 408,691 from in the Company’s Equity Incentive Plan to Jeffrey LeBlanc, the Company’s CFO.

On July 14, 2025, the Nasdaq Hearings Panel (the “Panel”) issued a letter to the Company that the Panel finds the Company in compliance with Listing Rules 5550(a)(1) and 5550(b)(1), the “Bid Price” and “Equity Rules,” respectively. On July 16, 2025, the Company issued a press release announcing that the Company regained compliance with the Nasdaq listing requirements. In addition, on July 14. 2025, Nasdaq approved the Company’s application to “phase down” the listing of its common stock and warrants from the Nasdaq Global Market to the Nasdaq Capital Market. The Company’s common stock will continue to trade under the symbol “KLTO” and the Company’s warrants will continue to trade under the symbol “KLTOW.”

On July 21, 2025, the Company signed a one-year lease in the amount of $8,400 for an office space in Charlotte, NC.

On July 28, 2025, the Company filed with the SEC a Supplemental Prospectus under the Form S-3 Registration Statement to register for resale an aggregate 12,500,000 Shares of Common Stock of the Company, which consists of 6,250,000 shares of Common Stock previously sold to two investors in a transaction exempt from the registration requirements of the Securities Act and 6,250,000 shares of Common Stock issuable upon the conversion of shares of the Company’s Series B Preferred Stock sold to an investor in a transaction exempt from the registration requirements of the Securities Act.

On July 28, 2025, the Company filed with the SEC a Supplemental Prospectus under the Form S-3 Registration Statement to register for the offer and sell shares of up to $50,000,000 in common stock, from time to time, through A.G.P., acting as the Company’s sales agent or principal. The sales of the common stock, if any, under the prospectus supplement will be made at market prices by any method deemed to be an “at the market offering.”

On August 6, 2025, Klotho Neurosciences, Inc. (the “Company”) entered into a Letter Agreement (“Agreement”) with AAVnerGene Inc. (“AAVnerGene”) for the manufacturing and development of its KLTO-202 gene therapy candidate using the AAVnerGene platform technology. AAVnerGene is an innovation-driven biotech renowned for its transformative technologies in adeno-associated viruses (AAV) manufacturing and tissue-targeted delivery.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

References in this report (this “Quarterly Report”) to “we,” “us” or the “Company” refer to Klotho Neurosciences, Inc. References to our “management” or our “management team” refer to our officers and directors. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the unaudited condensed consolidated financial statements and the notes thereto contained elsewhere in this Quarterly Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Special Note Regarding Forward-Looking Statements

This Quarterly Report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are not historical facts and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. All statements, other than statements of historical fact included in this Quarterly Report, including, without limitation, statements in this “Management’s Discussion and Analysis of Financial Condition and Results of Operations” regarding the search for an initial business combination, the Company’s financial position, business strategy and the plans and objectives of management for future operations, are forward-looking statements. Words such as “expect,” “believe,” “anticipate,” “intend,” “estimate,” “seek” and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect management’s current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward-looking statements, please refer to the Risk Factors section of the Company’s final prospectus for its initial public offering filed with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s filings with the SEC can be accessed on the EDGAR section of the SEC’s website at www.sec.gov. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Overview

Klotho Neurosciences, Inc. (“The Company” or “Klotho”) develops essential medicines for the treatment of chronic diseases – cancer, cardiovascular, and neurodegenerative disorders. The Company currently has acquired two licensed platforms: a generic drug portfolio and a biosimilar biologics platform that uses biologic therapies to treat cancer, and two proprietary, patented technologies involving the melanocortin receptor-binding molecules and a gene therapy platform which uses a gene therapy approach to introduce a therapeutic protein called “Klotho” inside the body to treat neurodegenerative diseases.

Effective September 17, 2024, the Company changed its legal name from ANEW Medical, Inc. to Klotho Neurosciences, Inc. This name change was approved by the Company’s Board of Directors to better reflect the strategic focus of its proprietary products. Throughout these financial statements, references to the ‘Company’ refer to Klotho Neurosciences, Inc., formerly known as ANEW or ANEW Public. Under certain circumstances, references to ANEW and ANEW Public have remained when useful in describing the sequence of events that occurred during the merger between Redwoods and ANEW.

As of May 30, 2023, Redwoods Acquisition Corp., a Delaware corporation and a special purpose acquisition company (“Redwoods”), Anew Medical Sub, Inc., a Wyoming corporation (“Merger Sub”) and ANEW Medical, Inc., a Wyoming corporation (“ANEW”) entered into a Business Combination Agreement, which was amended as of November 4, 2023 (the “Business Combination Agreement”). On June 21, 2024 (the “Closing Date”), Merger Sub merged with and into ANEW, with ANEW continuing as the surviving corporation and as a wholly owned subsidiary of Redwoods (the “Business Combination”). In connection with the Business Combination, on June 21, 2024, Redwoods filed a Second Amended Certificate of Incorporation with the Delaware Secretary of State, and adopted the amended and restated bylaws (the “Amended and Restated Bylaws”), which replaced Redwoods’ Charter and Bylaws in effect as of such time. In connection with the closing of the Business Combination (the “Closing”), Redwoods changed its name to “ANEW Medical, Inc.”

Critical Accounting Policies and Estimates

See Item 1, Note 2 – “Summary of Significant Accounting Policies.”

Results of Operations

For accounting purposes, the transactions contemplated by the Business Combination are treated as a reverse acquisition and, as such, the historical financial statements of the accounting acquirer Klotho will become the historical financial statements of Public ANEW. Under this method of accounting, Redwoods was treated as the acquired company for financial reporting purposes. Accordingly, for accounting purposes, the Merger was treated as the equivalent of the Company issuing shares for the net assets of Redwoods, accompanied by a recapitalization. The net assets of Redwoods were stated at historical cost with no goodwill or other intangible assets recorded.

We have not generated any operating revenues to date. To date, the Company’s operations have consisted of acquiring our licensed platforms and patents, and planning for the Business Combination. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as our expenses associated with planning our research and clinical testing operations.

Results of Operations for the Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024

Revenues

The Company had no revenue for the Three Months ended June 30, 2025 and 2024.

Operating Expenses

Our operating expenses for the three months ended June 30, 2025 were $1,892,852 compared to $395,607 for the three months ended June 30, 2024, an increase of $1,497,245. The increase was primarily due to increase in professional fees, general and administrative, share-based compensation expense, and commencement of research and development efforts.

Net Loss

For the three months ended June 30, 2025, we incurred a net loss of $4,093,231 compared to a net loss of $451,639 for the three months ended June 30, 2024. The increase in net loss was primarily due to increased share-based compensation expenses as well as professional fees and general operating expenses.

Results of Operations for the Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024

Revenues

The Company had no revenue for the six months ended June 30, 2025 and 2024.

Operating Expenses

Our operating expenses for the six months ended June 30, 2025 were $3,479,820 compared to $817,652 for the six months ended June 30, 2024, an increase of $2,662,168. The increase was primarily due to increase in professional fees, general and administrative, share-based compensation expense, and research and development efforts.

Net Loss

For the six months ended June 30, 2025, we incurred a net loss of $6,327,213 compared to a net loss of $1,123,683 for the six-month period ended June 30, 2024. The increase in net loss was primarily due to increased share-based compensation expense as well as professional fees and general operating expenses.

Liquidity and Capital Resources

	Six Months Ended June 30,
	2025			2024

Net cash used in operating activities	$	(3,522,178	)	$	(929,399	)
Net cash used in investing activities		-			(123,497	)
Net cash provided by financing activities		11,889,383			1,895,424
Net increase (decrease) in cash and cash equivalents	$	8,367,205		$	842,528
Cash, beginning of period		63,741			2,808
Cash, end of period	$	8,430,946		$	845,336

Operating Activities

Net cash used in operating activities for the six months ended June 30, 2025 was $3,522,178, compared to $929,399, for the six months ended June 30, 2024.The significant increase in cash used in operating activities is primarily attributable to increases in expenses related to continued operating costs. We expect net cash used in operating activities to increase in the coming periods, until our products are able to produce meaningful revenue.

Investing Activities

Net cash used in investing activities for the six months ended June 30, 2025 was $0, compared to $123,497 for the six months ended June 30, 2024, a decrease of $123,497. The decrease in cash used in investing activities is attributable to the Company not purchasing any new licenses during the period.

Financing Activities

Net cash provided by financing activities for the six months ended June 30, 2025 was $11,889,383, which consisted of investments, debt paydown, as well as proceeds from sales of common and preferred shares and warrants.

Net cash provided by financing activities for the six months ended June 30, 2024 was $1,895,424, which consisted of proceeds from issuance of a convertible promissory note $950,000, proceeds from the sale of stock and warrants, net of $175,000 and merger proceeds net of transaction costs of $770,424.

Liquidity, Capital Resources and Going Concern

As of June 30, 2025, the Company had cash of $8,430,946 and net working capital of $8,483,370.

The Company has incurred and expects to continue to incur significant professional costs to remain as a publicly traded company as well as incurred significant transaction costs related to the consummation of the Business Combination.

The accompanying condensed consolidated financial statements have been prepared as if the Company will continue as a going concern. The Company has incurred significant operating losses and negative cash flows from operations since inception. As of June 30, 2025, the Company had cash of approximately $8.4 million and an accumulated deficit of approximately $16.9 million. The Company has incurred recurring losses, has experienced recurring negative operating cash flows, and requires significant cash resources to execute its business plans. The Company is dependent on obtaining additional working capital funding from the sale of equity and/or debt securities in order to continue to execute its development plans and continue operations. Without additional funding, there is substantial doubt about the Company’s ability to continue as a going concern for twelve months from the date of these financial statements.

Off-Balance Sheet Arrangements

We have no obligations, assets or liabilities, which would be considered off-balance sheet arrangements as of June 30, 2025. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

Emerging Growth Company Status

We are an “emerging growth company”, as defined in the JOBS Act, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to emerging growth companies, including, but not limited to, not being required to have our independent registered public accounting firm audit our internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. As an emerging growth company, we can also delay adopting new or revised accounting standards until such time as those standards apply to private companies. We intend to avail ourselves of these options. Once adopted, we must continue to report on that basis until we no longer qualify as an emerging growth company.

We will cease to be an emerging growth company upon the earliest of: (i) the end of the fiscal year following the fifth anniversary of our initial public offering; (ii) the first fiscal year after our annual gross revenue are $1.07 billion or more; (iii) the date on which we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt securities; or (iv) the end of any fiscal year in which the market value of our common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year. We cannot predict if investors will find our common stock less attractive if we choose to rely on these exemptions. If, as a result of our decision to reduce future disclosure, investors find our common stock less attractive, there may be a less active trading market for our common stock and the price of our common stock may be more volatile.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As a smaller reporting company, we are not required to make disclosures under this Item.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of December 31, 2024. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of December 31, 2024, our disclosure controls and procedures were ineffective to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act (a) is recorded, processed, summarized and reported within the time periods specified by Securities and Exchange Commission (“SEC”) rules and forms and (b) is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding any required disclosure.

Management has identified control deficiencies regarding inadequate accounting resources, the lack of segregation of duties and the need for a stronger internal control environment. Management of the Company believes that these material weaknesses are due to the small size of the Company’s accounting staff. The small size of the Company’s accounting outsourced staff may prevent adequate controls in the future due to the cost/benefit of such remediation.

To mitigate the current limited resources and limited employees, we rely heavily on direct management oversight of transactions, along with the use of external legal and accounting professionals. As we grow, we expect to increase our number of employees, which will enable us to implement adequate segregation of duties within the internal control framework.

These control deficiencies could result in a misstatement of account balances that would result in a reasonable possibility that a material misstatement to our financial statements may not be prevented or detected on a timely basis. In light of this material weakness, we performed additional analyses and procedures in order to conclude that our financial statements for the period ended June 30, 2025 and year ended December 31, 2024 included in this Annual Report on Form 10-K were fairly stated in accordance with GAAP. Accordingly, management believes that despite our material weaknesses, our financial statements for the quarter ended June 30, 2025 are fairly stated, in all material respects, in accordance with GAAP.

Management’s Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Securities Exchange Act of 1934 Rule 13a-15(f). Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

●

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

●

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

●

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of the inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management assessed the effectiveness of our internal control over financial reporting as of June 30, 2025 and December 31, 2024. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the 2013 Treadway Commission (“COSO”) in Internal Control-Integrated Framework. Based upon this assessment, our Chief Executive Officer and Chief Financial Officer concluded that as of June 30, 2025 and December 31, 2024 our internal controls over financial reporting were ineffective.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal controls over financial reporting that occurred during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

As a smaller reporting company, we are not required to make disclosures under this Item.

Item 2. Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Insider Trading Arrangements and Policies

During the quarter ended June 30, 2025, none of the Company’s directors or officers adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as those terms are defined in Regulation S-K, Item 408, that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c).

Item 6. Exhibits

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report.

Exhibit No.		Description
19.1***		Klotho Neurosciences, Inc. Insider Trading Policy (incorporated by reference to Exhibit 19.1 filed by Klotho Neurosciences, Inc.’s on Form 10-Q filed with the SEC on November 19, 2024).
31.1*		Certification of Principal Executive Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*		Certification of Principal Accounting and Financial Officer Pursuant to Securities Exchange Act Rules 13a-14(a) and 15(d)-14(a), as adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2**		Certification of Principal Accounting and Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
97.1***		Clawback policy (incorporated by reference to Exhibit 97.1 filed by Redwoods on Form 10-K filed by the Registrant on April 17, 2024).
101.INS*		Inline XBRL Instance Document
101.SCH*		Inline XBRL Taxonomy Extension Schema Document
101.CAL*		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*		Inline XBRL Taxonomy Extension Labels Linkbase Document
101.PRE*		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*		Cover Page Interactive Data File (Embedded within the Inline XBRL document and included in Exhibit)

*	Filed herewith.
**	Furnished herewith. This certification is being furnished solely to accompany this report pursuant to 18 U.S.C. Section 1350, and is not being filed for purposes of Section 18 of the Exchange Act of 1934, as amended, and is not to be incorporated by reference into any filings of the Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
***	Filed previously.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	KLOTHO NEUROSCIENCES, INC.

Date: August 15, 2025	By:	/s/ Joseph A. Sinkule
	Name:	Joseph A. Sinkule
	Title:	Chief Executive Officer
		(Principal Executive Officer)

Date: August 15, 2025	By:	/s/ Jeffrey LeBlanc
	Name:	Jeffrey LeBlanc
	Title:	Chief Financial Officer (Principal Accounting Officer)

SEC Form 10-Q filed by Klotho Neurosciences Inc.