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 December 31,
2023
OR
☐ 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
333-191083
ACTAVIA LIFE
SCIENCES, INC.
(Exact name of registrant as specified in its
charter)
| Nevada | | 39-2080103 |
(State or other jurisdiction of
incorporation or organization) | | (I.R.S. Employer
Identification Number) |
5 Penn Plaza,
19th Floor, # 1954, New York, NY 10001
(Address of principal executive offices) (Zip
Code)
Telephone:
(646) 396-4087
(Registrant’s telephone number)
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 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 and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted 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 and post such files). Yes ☒ No ☐
Indicate by check mark whether
the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the
definition of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of
the Exchange Act. (Check one):
| 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 Act). Yes ☐ No ☒
Securities registered pursuant
to Section 12(b) of the Act: None
Indicate the number of shares
outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 771,811,360 shares
of common stock were issued and outstanding as of February 16, 2024.
TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ACTAVIA LIFE SCIENCES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
| | |
December 31,
2023 | | |
September 30,
2023 | |
| ASSETS | |
| | |
| |
| Current assets: | |
| | |
| |
| Cash | |
$ | 19,183 | | |
$ | 74,986 | |
| Prepaid and other receivables | |
| 6,992 | | |
| 20,671 | |
| Total assets | |
$ | 26,175 | | |
$ | 95,657 | |
| | |
| | | |
| | |
| LIABILITIES AND SHAREHOLDERS’ DEFICIT | |
| | | |
| | |
| | |
| | | |
| | |
| Liabilities: | |
| | | |
| | |
| Current liabilities: | |
| | | |
| | |
| Accounts payable and accrued expenses | |
$ | 1,513,816 | | |
$ | 1,458,216 | |
| Related party payables | |
| 388,576 | | |
| 380,339 | |
| Loan payable, related party | |
| 202,840 | | |
| 197,736 | |
| Note payable | |
| — | | |
| 8,509 | |
| Convertible notes payable, net - related party | |
| 22,862 | | |
| 4,730 | |
| Derivative liabilities | |
| 1,627 | | |
| 2,036 | |
| Total Current Liabilities | |
| 2,129,721 | | |
| 2,051,566 | |
| | |
| | | |
| | |
| Commitments and contingencies | |
| — | | |
| — | |
| | |
| | | |
| | |
| Shareholders’ deficit | |
| | | |
| | |
| Preferred stock, $0.001 par value 20,000,000 shares authorized, none issued and outstanding | |
| — | | |
| — | |
| Common stock, $0.001 par value; 1,500,000,000 shares authorized and 771,811,360 shares issued and outstanding at both December 31, 2023 and September 30, 2023 | |
| 771,811 | | |
| 771,811 | |
| Additional paid-in capital | |
| 25,935,882 | | |
| 25,935,882 | |
| Accumulated deficit | |
| (28,811,239 | ) | |
| (28,663,602 | ) |
| Total shareholders’ deficit | |
| (2,103,546 | ) | |
| (1,955,909 | ) |
| Total liabilities and shareholders’ deficit | |
$ | 26,175 | | |
$ | 95,657 | |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
ACTAVIA LIFE SCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
| | |
For the Three
Months Ended
December 31, | |
| | |
2023 | | |
2022 | |
| | |
| | |
| |
| Operating expenses: | |
| | |
| |
| General and administrative | |
$ | 106,213 | | |
$ | 104,856 | |
| Research and development | |
| 18,517 | | |
| 17,956 | |
| Total operating expenses | |
| 124,730 | | |
| 122,812 | |
| | |
| | | |
| | |
| Loss from operations | |
| (124,730 | ) | |
| (122,812 | ) |
| | |
| | | |
| | |
| Other income/(expense): | |
| | | |
| | |
| Interest expense | |
| (23,316 | ) | |
| (27,888 | ) |
| Gain on derivative liability | |
| 409 | | |
| 856 | |
| Total other expense | |
| (22,907 | ) | |
| (27,032 | ) |
| | |
| | | |
| | |
| Income tax provision | |
| — | | |
| — | |
| | |
| | | |
| | |
| Net loss | |
$ | (147,637 | ) | |
$ | (149,844 | ) |
| | |
| | | |
| | |
Basic and diluted net loss per share attributable to common shareholders | |
$ | 0.00 | | |
$ | 0.00 | |
| | |
| | | |
| | |
Basic and diluted weighted average common shares outstanding | |
| 771,811,360 | | |
| 179,979,361 | |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
ACTAVIA LIFE SCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS’ DEFICIT
(UNAUDITED)
| | |
Three Months Ended December 31, 2023 | |
| | |
Common Stock | | |
Additional Paid-In | | |
Accumulated | | |
Total Shareholders’ | |
| | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Deficit | |
| Balance at October 1, 2023 | |
| 771,811,360 | | |
$ | 771,811 | | |
$ | 25,935,882 | | |
$ | (28,663,602 | ) | |
$ | (1,955,909 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Net loss | |
| - | | |
| - | | |
| - | | |
| (147,637 | ) | |
| (147,637 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Balance at December 31, 2023 | |
| 771,811,360 | | |
$ | 771,811 | | |
$ | 25,935,882 | | |
$ | (28,811,239 | ) | |
$ | (2,103,546 | ) |
| | |
Three Months Ended December 31, 2022 | |
| | |
Common Stock | | |
Additional Paid-In | | |
Accumulated | | |
Total Shareholders’ | |
| | |
Shares | | |
Amount | | |
Capital | | |
Deficit | | |
Deficit | |
| Balance at October 1, 2022 | |
| 179,979,361 | | |
$ | 179,979 | | |
$ | 22,352,491 | | |
$ | (24,221,067 | ) | |
$ | (1,688,597 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Beneficial conversion feature related to convertible notes | |
| — | | |
| — | | |
| 28,800 | | |
| — | | |
| 28,800 | |
| Net loss | |
| — | | |
| — | | |
| — | | |
| (149,844 | ) | |
| (149,844 | ) |
| | |
| | | |
| | | |
| | | |
| | | |
| | |
| Balance at December 31, 2022 | |
| 179,979,361 | | |
$ | 179,979 | | |
$ | 22,381,291 | | |
$ | (24,370,911 | ) | |
$ | (1,809,641 | ) |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
ACTAVIA LIFE SCIENCES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
| | |
For the
Three Months Ended
December 31, | |
| | |
2023 | | |
2022 | |
| CASH FLOWS FROM OPERATING ACTIVITIES: | |
| | |
| |
| Net loss | |
$ | (147,637 | ) | |
$ | (149,844 | ) |
| Adjustments to reconcile net loss to net cash used in operating activities: | |
| | | |
| | |
| Non-cash interest expense | |
| 8,376 | | |
| 11,703 | |
| Accretion of debt discount | |
| 14,860 | | |
| 16,186 | |
| Derivative liability | |
| (409 | ) | |
| (856 | ) |
| Changes in operating assets and liabilities: | |
| | | |
| | |
| Accounts payable and accrued expenses | |
| 55,600 | | |
| 85,953 | |
| Related party payable | |
| 8,237 | | |
| 2,578 | |
| Prepayments and other receivables | |
| 13,679 | | |
| 32,890 | |
| Net cash used in operating activities | |
| (47,294 | ) | |
| (1,390 | ) |
| | |
| | | |
| | |
| CASH FLOWS FROM FINANCING ACTIVITIES: | |
| | | |
| | |
| Proceeds from issuance of convertible notes payable | |
| - | | |
| 30,000 | |
| Payments on note payable | |
| (8,509 | ) | |
| (20,420 | ) |
| Net cash (used in) provided by financing activities | |
| (8,509 | ) | |
| 9,580 | |
| | |
| | | |
| | |
| Net change in cash | |
| (55,803 | ) | |
| 8,190 | |
| | |
| | | |
| | |
| Cash, beginning of period | |
| 74,986 | | |
| 39,363 | |
| | |
| | | |
| | |
| Cash, end of period | |
$ | 19,183 | | |
$ | 47,553 | |
| | |
| | | |
| | |
| SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |
| | | |
| | |
| Derivative liabilities in connection with issuance and extension of convertible notes. | |
$ | - | | |
$ | 1,200 | |
| Beneficial conversion feature related to issuance and extension of convertible notes | |
$ | - | | |
$ | 28,800 | |
The accompanying notes are an integral part of
these unaudited condensed consolidated financial statements.
ACTAVIA LIFE SCIENCES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. GENERAL INFORMATION
Actavia Life Sciences, Inc. (f/k/a Rasna Therapeutics,
Inc. the “Company”) is a biotechnology company incorporated in the State of Delaware on March 28, 2016. The Company is engaged
in modulating the molecular target LSD1, which is implicated in the disease progression of leukemia and lymphoma.
These unaudited condensed consolidated financial
statements are presented in United States dollars (“USD”) which is also the functional currency of the primary economic environment
in which the Company operates.
Risks and Uncertainties
Management continues to evaluate the impact of
inflation and the economic environment on the Company, and has concluded that while it is reasonably possible that inflation could have
a negative effect on the Company’s financial position, results of its operations and/or ability to secure additional cash resources,
there is no current impact as cash resources are currently secured by existing shareholders. The financial statements do not include any
adjustments that might result from this uncertainty.
2. ACCOUNTING POLICIES
The principal accounting policies applied in the
preparation of these unaudited condensed consolidated financial statements are set out below. These policies have been applied consistently
to all the periods presented unless otherwise stated. There have been no material changes in the Company’s significant accounting
policies as compared to the significant accounting policies described in the Company’s annual report on Form 10-K for the Fiscal
year ended September 30, 2023.
Basis of preparation
These unaudited condensed consolidated financial
statements have been prepared following the requirements of the Securities and Exchange Commission (the “SEC”) and United
States generally accepted accounting principles (“US GAAP”) for interim reporting. The principles for condensed interim financial
information do not require the inclusion of all the information and footnotes required by generally accepted accounting principles for
complete financial statements. Therefore, these condensed consolidated financial statements should be read in conjunction with the
consolidated financial statements as of and for the year ended September 30, 2023 and notes thereto included in the Company’s
Annual Report on Form 10-K filed with the SEC on January 5, 2024. The accompanying unaudited condensed consolidated financial statements have
not been audited by an independent registered public accounting firm in accordance with the standards of the Public Company Accounting
Oversight Board (United States), but in the opinion of management, such financial statements include all adjustments, which include
only normal recurring adjustments, necessary to present fairly the Company’s interim financial information.
The results of the operations for the three months
ended December 31, 2023 may not be indicative of the results that may be expected for the year ending September 30, 2024.
Principles of Consolidation
The consolidated financial statements include
the financial statements of the Company and its wholly owned subsidiary, Rasna Research Inc, and Rasna Research Inc’s subsidiary,
Arna Therapeutics Limited. All significant intercompany accounts and transactions have been eliminated in the preparation of
the accompanying consolidated financial statements.
Use of Estimates
The preparation of financial statements in conformity
with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting
period. The Company evaluates its estimates on an ongoing basis, including those related to the fair values of share based awards, income
taxes and contingent liabilities, among others. The Company bases its estimates on historical experience and on various other assumptions
that the Company believes to be reasonable, the results of which form the basis for making judgments about the carrying values of assets
and liabilities. Actual results could differ from those estimates and such differences could be material to the Company’s consolidated
financial position and results of operations.
Net loss per Share
Basic net loss per share is computed by dividing
net loss available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted
income per share includes potentially dilutive securities such as outstanding options, warrants and convertible loan notes, using
various methods such as the treasury stock, modified treasury stock, and if converted methods in the determination of dilutive shares
outstanding during each reporting period.
The shares issuable on the exercise of options
and warrants have been excluded from the computation of diluted weighted average shares outstanding as they would be anti-dilutive.
| | |
December 31,
2023 | | |
December 31,
2022 | |
| Stock options | |
| 988,675 | | |
| 990,675 | |
| Warrants | |
| 1,926,501 | | |
| 1,926,501 | |
| Convertible notes and associated fees | |
| 84,124,444 | | |
| 208,086,667 | |
| Total shares issuable upon exercise or conversion | |
| 87,039,620 | | |
| 211,003,843 | |
Recent Accounting Pronouncements
The Company
has determined that all other recently issued accounting pronouncements will not have a material impact on its consolidated financial
position, results of operations and cash flows, or do not apply to its operations.
3. LIQUIDITY AND GOING CONCERN
The Company has no present revenue and has experienced net losses and
significant cash outflows from cash used in operating activities since inception.
The Company is subject to a number of risks similar
to those of other pre-commercial stage companies, including its dependence on key individuals, uncertainty of product development and
generation of revenues, dependence on outside sources of capital, risks associated with research, development, testing, and obtaining
related regulatory approvals of its pipeline products, suppliers and collaborators, successful protection of intellectual property, competition
with larger, better-capitalized companies, successful completion of the Company’s development programs and, ultimately, the attainment
of profitable operations are dependent on future events, including obtaining adequate financing to fulfill its development activities
and generating a level of revenues adequate to support the Company’s cost structure.
The Company has experienced net losses and significant
cash outflows from cash used in operating activities and as of December 31, 2023, had an accumulated deficit of $28,811,239, a net loss
for the three months ended December 31, 2023 of $147,637 and net cash used in operating activities of $47,294.
The Company expects to continue to incur net losses
and have significant cash outflows for at least the next 12 months and will require significant additional cash resources to
launch new development phases of existing products in its pipeline.
In the event that the Company is unable to secure
the additional cash resources needed, the Company may slow current development phases or halt new development phases in order to mitigate
the effects of the costs of development. These conditions, among others, raise substantial doubt about the Company’s ability to
continue as a going concern for a period of one year from the date of this filing. The accompanying condensed consolidated financial statements
have been prepared assuming that the Company will continue as a going concern one year from the date of this filing. This basis of accounting
contemplates the recovery of the Company’s assets and the satisfaction of liabilities in the normal course of business. A successful
transition to attaining profitable operations is dependent upon achieving a level of positive cash flows adequate to support the Company’s
cost structure.
4. CONVERTIBLE NOTES
The table below summarizes outstanding convertible notes as of December
31, 2023 and December 31, 2022:
| Balance of convertible notes payable- related party, net as of September 30, 2023 | |
$ | 4,730 | |
| Accrued Interest | |
| 3,272 | |
| Accretion of debt discount | |
| 14,860 | |
| Balance of related notes payable, net as of December 31, 2023 | |
$ | 22,862 | |
| | |
| | |
| Balance of convertible notes payable- related party, net as of September 30, 2022 | |
$ | 20,900 | |
| Issuance of debt | |
| 30,000 | |
| Accrued Interest | |
| 6,854 | |
| Accretion of debt discount | |
| 16,186 | |
| Beneficial conversion feature related to issuance of convertible notes | |
| (28,800 | ) |
| Derivative liabilities in connection with issuance of convertible notes | |
| (1,200 | ) |
| Balance of related notes payable, net as of December 31, 2022 | |
$ | 43,940 | |
On September
6, 2023, the Company entered into the sixteenth 16% Convertible Promissory Note again with Panetta Partners Ltd. (the “Holder”)
pursuant to which the Company issued a Convertible Promissory Note to the Holder. The Holder provided the Company with $80,000 in
cash. The Note provides the Holder with the right to convert, at any time, all or any part of the outstanding principal and accrued but
unpaid interest into shares of the Company’s common stock at a conversion price equal to the lower of (i) $0.001 per share
or (ii) the price of the next equity financing, which raises at least US $1,000,000, subject to adjustments noted within the Agreement.
The number of shares issuable upon a conversion shall be determined by the quotient obtained by dividing (x) the outstanding principal
amount of the Note to be converted by (y) the Conversion Price. The Note requires the Company to reserve and keep available out of its
authorized and unissued shares of common stock the amount of shares that would be issued upon conversion of the Note, which includes the
outstanding principal amount of the Note and interest accrued and to be accrued through the date of maturity.
Embedded Derivative Liability
Under the
promissory note agreement, the interest rate will reset upon the event of a default and an additional penalty of 2% will be accrued.
The Company analyzed the conversion features of the note agreement for derivative accounting consideration under ASC 815, Derivatives
and Hedging, and determined the interest rate resets met the definition of a derivative. It also noted that the Contingent Interest Rate
feature required bifurcation from the host note contract and was to be accounted for at fair value. In accordance with ASC 815-15, the
Company bifurcated the Contingent Interest Rate feature of the note and recorded a derivative liability.
The embedded
derivatives for the notes are carried on the Company’s balance sheet at fair value. There was no issuance of convertible notes for
the three months ended December 31, 2023. During the three months ended December 31, 2022, the Company recognized an additional $1,200 due
to the issuance of the convertible notes.
Beneficial
Conversion Feature
The conversion
features for all notes issued are in the money as of the issuance date and accordingly a beneficial conversion feature was recorded upon
issuance. As the intrinsic value of the beneficial conversion feature exceeds the face value, the recorded beneficial conversion feature
was limited to the gross proceeds less any debt discounts. As at December 31, 2022, the beneficial conversion feature amounted to $28,800.
5. NOTE PAYABLE
On March 31, 2023, the Company entered into a
one-year Directors and Officers Liability Insurance agreement for $53,950. Under the terms of the agreement, the Company made a down payment
of $13,500, with the remaining balance financed over the remaining term at an annual percentage rate of 6.99%, resulting in finance
charge of $1,187. Beginning in March 2023, the Company made 9 monthly payments of $4,626, with the last payment made in November 2023.
The interest expense for this note payable for the three ended December 31, 2023 was $80.
On May 15, 2022, the Company entered into a one-year
Directors and Officers Liability Insurance agreement for $89,242. Under the terms of the agreement, the Company made a down payment of
$10,210, with the remaining balance financed over the remaining term at an annual percentage rate of 7.328%. Beginning in May 2022, the
Company is making 8 monthly payments of $10,210, with the last payment made in December 2022. At December 31, 2022, the note was fully
paid. The interest expense for the three months ending December 31, 2022 was $186.
6. RELATED PARTY TRANSACTIONS
The following is a summary of the related party
transactions for the periods presented.
During the normal course of its business, the
Company enters into various transactions with entities that are both businesses and individuals. The following is a summary of the related
party transactions for the periods presented.
Gabriele Cerrone/Panetta Partners
Panetta Partners Limited, a shareholder of Actavia,
is a company in which Gabriele Cerrone is a major shareholder and also serves as a director. As of December 31, 2023, and September 30,
2023, the balance due to Gabriele Cerrone was $175,000 for past consultancy services, which is presented as a component of related
party payables.
In December 2022, the
Company entered into an additional promissory note with Panetta Partners Ltd for $30,000. The note carried an interest rate of 16%
with a conversion price of $0.001 and was due for repayment by December 31, 2024. The note was converted into stock in January 2023.
In September 2023, the
Company entered into an additional promissory note with Panetta Partners Ltd for $80,000. The note carried an interest rate of 16%
with a conversion price of $0.001 and was due for repayment by December 31, 2024. As at December 31, 2023, $84,124 was due with
respect to this note issued.
Apart from the Convertible
Promissory Notes, there is no interest charged on the balances with related parties. There are no defined repayment terms, and
such amounts can be called for payment at any time.
Tiziana Life Sciences
(“Tiziana”)
The Company is party
to a Shared Services Agreement with Tiziana, whereby the Company is charged for shared services and rent. Keeren Shah, the Company’s
Chief Financial Officer, is also Chief Financial Officer of Tiziana, and the Company’s directors, Willy Simon and John Brancaccio
are also non-executive directors of Tiziana.
As of December 31, 2023,
and September 30, 2023, $213,576 and $205,340, respectively, was due to Tiziana under services charged under the shared services
agreement and other expenses paid by Tiziana on behalf of the Company. This is recorded as a related party payable in the accompanying
condensed consolidated balance sheets.
In March 2020, Tiziana extended
a loan facility to Rasna of $65,000. The loan is repayable within 18 months and is incurring an interest charge of 8% per annum.
In April 2020, the loan facility was extended by a further $7,000, so the loan facility totals $72,000. As of December 31, 2023, the amount
due to Tiziana under this loan facility was $93,600. The amount due to Tiziana under this agreement as of September 30, 2023 was
$92,160.
In July 2022, Tiziana extended
another loan facility to Rasna of $85,000. The loan is repayable within 18 months and is incurring an interest charge of 16% per
annum. As of December 31, 2023, the amount due to Tiziana under this loan facility was $109,240. As of September 30, 2023, the amount
due to Tiziana under this loan facility was $105,576.
Apart from the Convertible Promissory Notes, there
is no interest charged on the balances with related parties. There are no defined repayment terms, and such amounts can be called for
payment at any time.
7. SUBSEQUENT EVENT
In February 2024, the Company entered into a promissory
note with Panetta Partners Ltd for $18,000. The note carries an interest rate of 16% with a conversion price of $0.001 and
is due for repayment by December 31, 2025.
ITEM 2. Management’s Discussion and Analysis
of Financial Condition and Results of Operations
Forward-Looking Statements
This section and other parts of this Quarterly
Report on Form 10-Q contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking
statements provide current expectations of future events based on certain assumptions and include any statement that does not directly
relate to any historical or current fact. Forward-looking statements can also be identified by words such as “future,” “anticipates,”
“believes,” “estimates,” “expects,” “intends,” “plans,” “predicts,”
“will,” “would,” “could,” “can,” “may,” and similar terms. Forward-looking
statements are not guarantees of future performance and the Company’s actual results may differ significantly from the results discussed
in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in the Company’s
Annual Report on Form 10-K filed on January 5, 2024 under the heading “Risk Factors,” which are incorporated herein by reference.
We assume no obligation to revise or publicly
release the results of any revision to these forward-looking statements, except as required by law. Given these risks and uncertainties,
readers are cautioned not to place undue reliance on such forward-looking statements.
Unless expressly indicated or the context requires
otherwise, the terms “Rasna,”,” the “Company,” “we,” “us,” and “our”
refer to Actavia Life Sciences, Inc., a Nevada corporation, and, where appropriate, its wholly owned subsidiaries.
Company Background
To date, we have devoted substantially all of
our resources to research and development efforts relating to our therapeutic candidates, including conducting clinical trials and developing
manufacturing capabilities, in-licensing related intellectual property, protecting our intellectual property and providing general and
administrative support for these operations. Since our inception, we have funded our operations primarily through the issuance of equity
securities and convertible notes.
We anticipate that our expenses will increase substantially if and
as we:
| |
● |
initiate new clinical trials; |
| |
● |
seek to identify, assess, acquire and develop other products, therapeutic candidates and technologies; |
| |
● |
seek regulatory and marketing approvals in multiple jurisdictions for our therapeutic candidates that successfully complete clinical studies; |
| |
● |
establish collaborations with third parties for the development and commercialization of our products and therapeutic candidates; |
| |
● |
make milestone or other payments under our agreements pursuant to which we have licensed or acquired rights to intellectual property and technology; |
| |
● |
seek to maintain, protect, and expand our intellectual property portfolio; |
| |
● |
seek to attract and retain skilled personnel; |
| |
● |
incur the administrative costs associated with being a public company and related costs of compliance; |
| |
● |
create additional infrastructure to support our operations as a commercial stage public company and our planned future commercialization efforts; and |
| |
● |
experience any delays or encounter issues with any of the above. |
We expect to continue to incur significant expenses
and increasing losses for at least the next several years. Accordingly, we anticipate that we will need to raise additional capital in
addition to the net proceeds from this offering in order to obtain regulatory approval for, and the commercialization of our therapeutic
candidates. Until such time that we can generate meaningful revenue from product sales, if ever, we expect to finance our operating activities
through public or private equity or debt financings, government or other third-party funding, marketing and distribution arrangements
and other collaborations, strategic alliances and licensing arrangements or a combination of these approaches. If we are unable to obtain
funding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our research or development
programs or the commercialization of any approved therapies or products or be unable to expand our operations or otherwise capitalize
on our business opportunities, as desired, which could materially adversely affect our business, financial condition and results of operations.
We only have one segment of activity, which is
that of a biotechnology company focused on targeted drugs to treat diseases in oncology and immunology, mainly focusing on the treatment
of leukemia and lymphoma.
Critical Accounting Policies and Estimates
This discussion and analysis of our financial
condition and results of operations is based on our financial statements, which have been prepared in accordance with generally accepted
accounting principles in the United States of America, or US GAAP. The preparation of these financial statements requires us to make estimates
and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reported period. In accordance with US GAAP, we base our estimates
on historical experience and on various other assumptions that we believe are reasonable under the circumstances. Actual results may differ
from these estimates under different assumptions or conditions.
Basis of preparation
The accompanying financial statements have been
prepared in conformity with US GAAP. Any reference in these notes to applicable guidance is meant to refer to US GAAP as found in the
Accounting Standards Codification (“ASC”) and Accounting Standards Updates (“ASU”) of the Financial Accounting
Standards Board (“the FASB”).
Liquidity and Going Concern
We are subject to a number of risks similar to
those of other pre-commercial stage companies, including our dependence on key individuals, uncertainty of product development and generation
of revenues, dependence on outside sources of capital, risks associated with research, development, testing, and obtaining related regulatory
approvals of its pipeline products, suppliers and collaborators, successful protection of intellectual property, competition with larger,
better-capitalized companies, successful completion of our development programs and, ultimately, the attainment of profitable operations
are dependent on future events, including obtaining adequate financing to fulfill our development activities and generating a level of
revenues adequate to support our cost structure.
We have no present revenue and have experienced
net losses and significant cash outflows from cash used in operating activities since inception, and at December 31, 2023, had a working
capital deficit of $2,103,546.
We expect to continue to incur net losses and
have significant cash outflows for at least the next twelve months and will require significant additional cash resources to launch new
development phases of existing products in its pipeline. In the event that the Company is unable to secure the necessary additional cash
resources needed, we may slow current development phases or halt new development phases in order to mitigate the effects of the costs
of development. These conditions, among others, raise substantial doubt about our ability to continue as a going concern one year from
the date of this filing. The accompanying condensed consolidated financial statements have been prepared assuming that we will continue
as a going concern one year from the date of this filing. This basis of accounting contemplates the recovery of our assets and the satisfaction
of liabilities in the normal course of business. A successful transition to attaining profitable operations is dependent upon achieving
a level of positive cash flows adequate to support our cost structure.
The Company is currently looking into raising
funds to progress its R&D pipeline.
Results of Operations
The following paragraphs set forth our results
of operations for the periods presented. The period-to-period comparison of financial results is not necessarily indicative of future
results.
Results of Operations for
the Three months ended December 31, 2023 and 2022
The following table sets forth the summary statements
of operations for the periods indicated:
| | |
For the
Three Months Ended
December 31, | |
| | |
2023 | | |
2022 | |
| | |
(Unaudited) | | |
(Unaudited) | |
| | |
| | |
| |
| Operating (income)/expenses: | |
| | |
| |
| General and administrative | |
$ | 106,213 | | |
$ | 104,856 | |
| Research and development | |
| 18,517 | | |
| 17,956 | |
| Total operating (income)/ expenses | |
| 124,730 | | |
| 122,812 | |
| | |
| | | |
| | |
| Income/ (loss) from operations | |
| (124,730 | ) | |
| (122,812 | ) |
| | |
| | | |
| | |
| Other expense: | |
| | | |
| | |
| Interest expense | |
| (23,316 | ) | |
| (27,888 | ) |
| Gain on derivative liability | |
| 409 | | |
| 856 | |
| | |
| | | |
| | |
| Other expense | |
| (22,907 | ) | |
| (27,032 | ) |
| | |
| | | |
| | |
| Net loss | |
$ | (147,637 | ) | |
$ | (149,844 | ) |
Revenues
There were no revenues for the three
months ended December 31, 2023, and 2022 because the Company does not have any commercial biopharmaceutical products.
Operating Expenses
Operating expenses, consisting of research and
development costs, consultancy fees, legal and professional fees and general and administrative expenses, for the three months ended December
31, 2023 increased to $124,730 from $122,812 for the three months ended December 31, 2023, an increase of $1,918.
Other expense
During the three months ended December 31, 2023,
other expense decreased to $22,907 from $27,032 for the three months ended December 31, 2022. This decrease is predominantly due to less
accretion of debt discount charges and less gain on the adjustment of a derivative liability incurred in the three months ended December
31, 2023.
Net loss
Net loss for the three months ended December
31, 2023 decreased to $147,637 from a net loss of $149,844 for the three months ended December 31, 2022, a
change of $2,207. This is predominantly due to less accretion of debt discount charges and less gain on the adjustment of a
derivative liability incurred in the three months ended December 31, 2023 as most notes had been converted as well as a decrease in legal
fees and accounting fees.
Liquidity and Capital Resources
We believe we will require significant additional
cash resources to continue to launch new development phases of existing products in the Company’s pipeline. In the event that
we are unable to secure the necessary additional cash resources needed, we may slow current development phases or halt new development
phases in order to mitigate the effects of the costs of development. These conditions, among others, raise substantial doubt about our
ability to continue as a going concern. A successful transition to attaining profitable operations is dependent upon achieving a level
of positive cash flows adequate to support our cost structure. We cannot be certain that additional funding will be available on
acceptable terms, or at all. To the extent that we raise additional funds by issuing equity securities, our shareholders may experience
significant dilution. Any debt financing, if available, may (i) involve restrictive covenants that impact our ability to conduct, delay,
scale back or discontinue the development and/or commercialization of one or more product candidates; (ii) seek collaborators for
product candidates at an earlier stage than otherwise would be desirable and on terms that are less favorable than might otherwise be
available; or (iii) relinquish or otherwise dispose of rights to technologies, product candidates or products that we would otherwise
seek to develop or commercialize its self on unfavorable terms.
Capital Resources
The following table summarizes total current assets,
liabilities and working capital deficiency as of the periods indicated:
| | |
December 31,
2023 (Unaudited) | | |
September 30,
2023 (Unaudited) | | |
Change | |
| | |
| | |
| | |
| |
| Current assets | |
$ | 26,175 | | |
$ | 95,657 | | |
$ | (69,482 | ) |
| Current liabilities | |
| 2,129,721 | | |
| 2,051,566 | | |
| 78,155 | |
| Working capital deficit | |
$ | (2,103,546 | ) | |
$ | (1,955,909 | ) | |
$ | (147,637 | ) |
We had a cash balance of $19,183 and $74,986
on December 31, 2023, and September 30, 2023, respectively.
Liquidity
The following table sets forth a summary of our
cash flows for the periods indicated:
| | |
For the
three months ended
December 31, | |
| | |
2023 | | |
2022 | | |
Increase/
(Decrease) | |
| Net cash used in operating activities | |
$ | (47,294 | ) | |
$ | (1,390 | ) | |
$ | (45,904 | ) |
| Net cash used in investing activities | |
$ | — | | |
$ | — | | |
$ | — | |
| Net cash provided by (used in) financing activities | |
$ | (8,509 | ) | |
$ | 9,580 | | |
$ | (18,089 | ) |
Net Cash Used in Operating Activities
Net cash used in operating activities consists
of net loss adjusted for the effect of changes in operating assets and liabilities.
Net cash used in operating activities was $47,294
for the three months ended December 31, 2023 compared to $1,390 for the three months ended December 31, 2022. The net loss
of $147,637 for the three months ended December 31, 2023 was partially offset primarily by a gain on derivative liability of $409, adjusted
for accretion of debt discount of $14,860, interest expense of $8,376 and changes in operating assets and liabilities of $77,516.
Net Cash provided by /(Used in) Financing Activities
Net cash used in financing activities consists
of payments on a note payable of $8,509 for the three months ended December 31, 2023 compared to proceeds from the issuance of convertible
notes of $30,000 offset by payments for on a note payable of $20,420 for the three months ended December 31, 2022.
ITEM 3. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We maintain “disclosure controls and procedures,”
as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
This term refers to the controls and procedures of a company that are designed to ensure that information required to be disclosed by
a company in the reports that it files under the Exchange Act is recorded, processed, summarized, and reported within the required time
periods. In designing and evaluating our disclosure controls and procedures, our management recognized that disclosure controls and
procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of
disclosure controls and procedures are met. Additionally, in designing disclosure controls and procedures, our management necessarily
was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design
of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there
can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
As of the end of the period covered by this Report,
the Company’s Chief Executive Officer, evaluated the effectiveness of the Company’s “disclosure controls and procedures,”
as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934. Based on that evaluation, the Chief Executive officer
concluded that, as of the date of the evaluation, the Company’s disclosure controls and procedures were not effective to provide
reasonable assurance that the information required to be disclosed in the Company’s periodic filings under the Securities Exchange
Act of 1934 is accumulated and communicated to management to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial
Reporting
There were no changes in our internal control
over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) 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 1A. RISK FACTORS
There have been no material changes from the risk
factors disclosed in our Annual Report on Form 10-K as of and for the year ended September 30, 2023, filed with the SEC on January
5, 2024.
ITEM 6. EXHIBITS
Signatures
Pursuant to the requirements of Section 13
or 15(d) 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.
| |
Actavia Life Sciences, Inc. |
| |
|
|
| February 16, 2024 |
By: |
/s/ Keeren Shah |
| |
|
Name: |
Keeren Shah |
| |
|
Title: |
Chief Financial Officer,
(Principal Executive Officer and
Principal Financial and Accounting Officer) |
16
0.00
0.00
179979361
771811360
false
--09-30
Q1
2024
0001582249
0001582249
2023-10-01
2023-12-31
0001582249
2024-02-16
0001582249
2023-12-31
0001582249
2023-09-30
0001582249
us-gaap:RelatedPartyMember
2023-12-31
0001582249
us-gaap:RelatedPartyMember
2023-09-30
0001582249
2022-10-01
2022-12-31
0001582249
us-gaap:CommonStockMember
2023-09-30
0001582249
us-gaap:AdditionalPaidInCapitalMember
2023-09-30
0001582249
us-gaap:RetainedEarningsMember
2023-09-30
0001582249
us-gaap:CommonStockMember
2023-10-01
2023-12-31
0001582249
us-gaap:AdditionalPaidInCapitalMember
2023-10-01
2023-12-31
0001582249
us-gaap:RetainedEarningsMember
2023-10-01
2023-12-31
0001582249
us-gaap:CommonStockMember
2023-12-31
0001582249
us-gaap:AdditionalPaidInCapitalMember
2023-12-31
0001582249
us-gaap:RetainedEarningsMember
2023-12-31
0001582249
us-gaap:CommonStockMember
2022-09-30
0001582249
us-gaap:AdditionalPaidInCapitalMember
2022-09-30
0001582249
us-gaap:RetainedEarningsMember
2022-09-30
0001582249
2022-09-30
0001582249
us-gaap:CommonStockMember
2022-10-01
2022-12-31
0001582249
us-gaap:AdditionalPaidInCapitalMember
2022-10-01
2022-12-31
0001582249
us-gaap:RetainedEarningsMember
2022-10-01
2022-12-31
0001582249
us-gaap:CommonStockMember
2022-12-31
0001582249
us-gaap:AdditionalPaidInCapitalMember
2022-12-31
0001582249
us-gaap:RetainedEarningsMember
2022-12-31
0001582249
2022-12-31
0001582249
us-gaap:StockOptionMember
2023-10-01
2023-12-31
0001582249
us-gaap:StockOptionMember
2022-10-01
2022-12-31
0001582249
us-gaap:WarrantMember
2023-10-01
2023-12-31
0001582249
us-gaap:WarrantMember
2022-10-01
2022-12-31
0001582249
rasp:ConvertibleNotesAssociatedFeesMember
2023-10-01
2023-12-31
0001582249
rasp:ConvertibleNotesAssociatedFeesMember
2022-10-01
2022-12-31
0001582249
2023-09-01
2023-09-06
0001582249
2023-09-06
0001582249
rasp:RelatedPartyNotesPayableMember
2023-09-30
0001582249
rasp:RelatedPartyNotesPayableMember
2023-10-01
2023-12-31
0001582249
rasp:RelatedPartyNotesPayableMember
2023-12-31
0001582249
rasp:RelatedPartyNotesPayableMember
2022-09-30
0001582249
rasp:RelatedPartyNotesPayableMember
2022-10-01
2022-12-31
0001582249
rasp:RelatedPartyNotesPayableMember
2022-12-31
0001582249
2023-03-31
0001582249
2023-03-31
2023-03-31
0001582249
2022-05-15
0001582249
2022-05-15
2022-05-15
0001582249
rasp:PanettaPartnersLtdMember
2022-12-31
0001582249
srt:ScenarioForecastMember
rasp:GabrieleCerronePanettaPartnersMember
2024-12-31
0001582249
rasp:PanettaPartnersLtdMember
2023-09-30
0001582249
srt:ScenarioForecastMember
2024-12-31
0001582249
rasp:TizianaLifeSciencesPlcMember
2023-10-01
2023-12-31
0001582249
rasp:TizianaLifeSciencesPlcMember
2022-10-01
2023-09-30
0001582249
2020-03-31
0001582249
rasp:TizianaLifeSciencesPlcMember
2020-03-31
0001582249
2020-04-30
0001582249
2022-07-31
0001582249
rasp:TizianaLifeSciencesPlcMember
2022-07-31
0001582249
rasp:RobertoPellicciariAndTESPharmaMember
srt:MinimumMember
2023-12-31
0001582249
srt:MaximumMember
rasp:TizianaLifeSciencesPlcMember
2023-09-30
0001582249
us-gaap:SubsequentEventMember
2024-02-14
0001582249
rasp:PanettaPartnersLtdMember
us-gaap:SubsequentEventMember
2024-02-14
xbrli:shares
iso4217:USD
iso4217:USD
xbrli:shares
xbrli:pure