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Dominari Holdings Inc. - Quarter Report: 2021 September (Form 10-Q)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2021

 

☐ 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 000-05576

 

AIKIDO PHARMA INC.
(Exact name of registrant as specified in its charter)

 

Delaware   52-0849320
(State or other jurisdiction of
incorporation or organization)
  (I.R.S. Employer
Identification No.)

 

One Rockefeller Plaza, 11th Floor, New York, NY 10020
(Address of Principal Executive Offices, including zip code)

 

(703) 992-9325
(Registrant’s telephone number, including area code)

 

Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the 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 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 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 definition 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 ☒

 

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, $0.0001 par value   AIKI   The Nasdaq Capital Market LLC

 

As of November 10, 2021, there were 89,681,146 shares of the Company’s common stock issued and outstanding.

 

 

 

 

AIKIDO PHARMA INC.

Form 10-Q

For the Quarter Ended September 30, 2021

 

Index

 

    Page No.
     
Part I. Financial Information
     
Item 1. Financial Statements (Unaudited) 1
     
  Condensed Consolidated Balance Sheets as of September 30, 2021 (Unaudited) and December 31, 2020 1
     
  Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2021 and 2020 (Unaudited) 2
     
  Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and nine months ended September 30, 2021 and 2020 (Unaudited) 3
     
  Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020 (Unaudited) 5
     
  Notes to the Condensed Consolidated Financial Statements (Unaudited) 6
     
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 14
     
Item 3. Quantitative and Qualitative Disclosures About Market Risk 18
     
Item 4. Controls and Procedures 18
     
Part II. Other Information
     
Item 1. Legal Proceedings 19
     
Item 1A. Risk Factors 19
     
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 19
     
Item 6. Exhibits 19
     
Signatures 20

 

i

 

PART I - FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

AIKIDO PHARMA INC.

Condensed Consolidated Balance Sheets

($ in thousands except share and per share amounts)

 

   September 30,   December 31, 
   2021   2020 
   (Unaudited)     
ASSETS        
Current assets        
Cash and cash equivalents  $5,948   $2,715 
Marketable securities   80,525    24,801 
Prepaid expenses and other assets   644    215 
Short-term investment   6,274    
-
 
Deposits   4,420    
-
 
Total current assets   97,811    27,731 
           
Convertible note receivable   2,107    
-
 
Investments   5,066    2,764 
Total assets  $104,984   $30,495 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities          
Accounts payable and accrued expenses  $1,572   $567 
Accrued salaries and benefits   237    310 
Total current liabilities   1,809    877 
           
Total liabilities   1,809    877 
           
Commitments and contingencies   
 
    
 
 
           
Stockholders’ equity          
Preferred stock, $.0001 par value, 50,000,000 Authorized   
 
    
 
 
Series D: 5,000,000 shares designated; 4,725 shares issued and outstanding at September 30, 2021 and December 31, 2020; liquidation value of $0.0001 per share   
-
    
-
 
Series D-1: 5,000,000 shares designated; 834 shares issued and outstanding at September 30, 2021 and December 31, 2020; liquidation value of $0.0001 per share   
-
    
-
 
Common stock, $0.0001 par value, 100,000,000 shares authorized; 89,681,149 and 34,920,222 shares issued at September 30, 2021 and December 31, 2020, respectively; 89,681,146 and 34,920,219 shares outstanding at September 30, 2021 and December 31, 2020, respectively   9    3 
Additional paid-in capital   265,394    186,482 
Treasury stock, at cost, 3 shares at September 30, 2021 and December 31, 2020   (264)   (264)
Accumulated deficit   (161,964)   (156,603)
Total stockholders’ equity   103,175    29,618 
Total liabilities and stockholders’ equity  $104,984   $30,495 

 

See accompanying notes to condensed consolidated financial statements.

 

1

 

 

AIKIDO PHARMA INC.

Condensed Consolidated Statements of Operations

($ in thousands except share and per share amounts)

(Unaudited)

 

   Three Months Ended
September 30,
   Nine Months Ended
September 30,
 
   2021   2020   2021   2020 
Operating costs and expenses                
General and administrative  $1,676   $734   $5,231   $3,054 
Research and development   100    191    497    951 
Research and development - license acquired   3    41    1,128    1,154 
Total operating expenses   1,779    966    6,856    5,159 
Loss from operations   (1,779)   (966)   (6,856)   (5,159)
                     
Other income (expenses)                    
Other income   
-
    4    135    19 
Interest income   40    
-
    107    
-
 
Loss on marketable securities   (3,033)   (433)   (2,574)   (171)
Change in fair value of investment   4,725    (622)   3,827    (7,352)
Total other income (expenses)   1,732    (1,051)   1,495    (7,504)
Net loss  $(47)  $(2,017)  $(5,361)  $(12,663)
                     
Net loss per share, basic and diluted                    
Basic and Diluted  $(0.00)  $(0.06)  $(0.07)  $(0.49)
                     
Weighted average number of shares outstanding, basic and diluted                    
Basic and Diluted   89,632,233    34,986,885    79,944,095    25,753,040 

 

See accompanying notes to condensed consolidated financial statements.

 

2

 

 

AIKIDO PHARMA INC.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

($ in thousands except share and per share amounts)

(Unaudited)

 

For the Three Months Ended September 30, 2021

 

   Common Stock   Preferred Stock   Additional
Paid-in
   Treasury Stock   Accumulated   Total Stockholders’ 
   Shares   Amount   Shares   Amount   Capital   Shares   Amount   Deficit   Equity 
Balance at June 30, 2021   89,531,146   $9    5,559   $
     -
   $265,255    3   $(264)  $(161,917)  $103,083 
Stock-based compensation   150,000    
-
    -    
-
    139    -    
-
    
-
    139 
Net loss   -    
-
    -    
-
    
-
    -    
-
    (47)   (47)
Balance at September 30, 2021   89,681,146   $9    5,559   $
-
   $265,394    3   $(264)  $(161,964)  $103,175 

 

For the Three Months Ended September 30, 2021

 

   Common Stock   Preferred Stock   Additional
Paid-in
   Treasury Stock   Accumulated   Total Stockholders’ 
   Shares   Amount   Shares   Amount   Capital   Shares   Amount   Deficit   Equity 
Balance at June 30, 2020   34,920,219   $3    5,559   $
    -
   $186,667    3   $(264)  $(154,912)  $31,494 
Distribution of Hoth common stock   -    
-
    -    
-
    (269)   
-
    -    -    (269)
Net loss   -    
-
    -    
-
    
-
    -    
-
    (2,017)   (2,017)
Balance at September 30, 2020   34,920,219   $3    5,559   $
-
   $186,398    3   $(264)  $(156,929)  $29,208 

 

See accompanying notes to condensed consolidated financial statements.

 

3

 

 

AIKIDO PHARMA INC.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

($ in thousands except share and per share amounts)

(Unaudited)

 

For the Nine Months Ended September 30, 2021

 

   Common Stock   Preferred Stock   Additional
Paid-in
   Treasury Stock   Accumulated   Total Stockholders’ 
   Shares   Amount   Shares   Amount   Capital   Shares   Amount   Deficit   Equity 
Balance at December 31, 2020   34,920,219   $3    5,559   $
-
   $186,482    3   $(264)  $(156,603)  $29,618 
Issuance of common stock and warrants (net of offering costs of $8,260)   53,905,927    6    
-
    
-
    77,983    
-
    
-
    
-
    77,989 
Exercise of warrants   80,000    
-
    
-
    
-
    84    
-
    
-
    
-
    84 
Issuance of common stock for research and development license acquired   625,000    
-
    
-
    
-
    531    
-
    
-
    
-
    531 
Stock-based compensation   150,000    
-
    -    
-
    314    -    
-
    
-
    314 
Net loss   -    
-
    -    
-
    
-
    -    
-
    (5,361)   (5,361)
Balance at September 30, 2021   89,681,146   $9    5,559   $
-
   $265,394    3   $(264)  $(161,964)  $103,175 

 

For the Nine Months Ended September 30, 2020

 

   Common Stock   Preferred Stock   Additional
Paid-in
   Treasury Stock   Accumulated   Total Stockholders’ 
   Shares   Amount   Shares   Amount   Capital   Shares   Amount   Deficit   Equity 
Balance at December 31, 2019   4,825,549   $
-
    5,559   $
-
   $155,062    3   $(264)  $(144,266)  $10,532 
Issuance of common stock, common warrants and prefunded warrants (net of offering costs of $941)   3,245,745    
-
    
-
    
-
    6,559    
-
    
-
    
-
    6,559 
Issuance of common stock, net of offering cost (net of offering costs of $1,905)   16,090,909    2    
-
    
-
    17,843    
-
    
-
    
-
    17,845 
Common warrant and prefunded warrant exercise   10,758,016    1    
-
    
-
    7,203    
-
    
-
    
-
    7,204 
Distribution of Hoth common stock   -    
-
    -    
-
    (269)   -    
-
    
-
    (269)
Net loss   -    
-
    -    
-
    
-
    -    
-
    (12,663)   (12,663)
Balance at September 30, 2020   34,920,219   $3    5,559   $
-
   $186,398    3   $(264)  $(156,929)  $29,208 

 

See accompanying notes to condensed consolidated financial statements.

 

4

 

 

AIKIDO PHARMA INC.

Condensed Consolidated Statements of Cash Flows

($ in thousands)

(Unaudited)

 

   Nine Months Ended
September 30,
 
   2021   2020 
Cash flows from operating activities        
Net loss  $(5,361)  $(12,663)
Adjustments to reconcile net loss to net cash used in operating activities:          
Change in fair value of investment   (3,827)   7,352 
Research and development-acquired license, expensed   1,128    1,154 
Stock-based compensation   314    
-
 
Realized gain on marketable securities   (501)   (97)
Unrealized loss on marketable securities   4,296    781 
Changes in operating assets and liabilities:          
Prepaid expenses and other assets   (429)   135 
Accounts payable and accrued expenses   5    30 
Accrued salaries and benefits   (73)   (321)
Interest receivable on convertible note   (107)   
-
 
Payable to DatChat   
-
    50 
Net cash used in operating activities   (4,555)   (3,579)
           
Cash flows from investing activities          
Purchase of marketable securities   (90,541)   (98,524)
Sale of marketable securities   30,439    72,008 
Proceeds from sale of Hoth common shares   
-
    460 
Proceeds from sale of DatChat common shares   900    - 
Funds to deposit accounts, net   (4,420)   
-
 
Purchase of investments   (4,066)   - 
Purchase of research and development licenses   (597)   (1,154)
Purchase of convertible note   (2,000)   
-
 
Net cash used in investing activities   (70,285)   (27,210)
           
Cash flows from financing activities          
Proceeds from issuance of common stock and warrants, net of offering cost   77,989    6,559 
Proceeds from issuance of common stock, net of offering cost   
-
    17,845 
Proceeds from exercise of warrants   84    7,204 
Net cash provided by financing activities   78,073    31,608 
           
Net increase in cash and cash equivalents   3,233    819 
Cash and cash equivalents, beginning of period   2,715    91 
           
Cash and cash equivalents, end of period  $5,948   $910 
           
Non-cash investing and financing activities          
Distribution of Hoth common stock  $-   $269 
Unpaid investment  $1,000   $- 

 

See accompanying notes to condensed consolidated financial statements.

 

5

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 1. Organization and Description of Business and Recent Developments

 

Organization and Description of Business

 

AIkido Pharma Inc. (the “Company” and “We”), formerly known as Spherix Incorporated, was initially formed in 1967. Since 2017, the Company  has operated as a biotechnology company with a diverse portfolio of small-molecule anticancer and antiviral therapeutics in development. The Company’s pipeline consists of patented technology from leading universities and researchers. The Company is currently in the process of developing its innovative therapeutic drug pipeline through strong partnerships with world renowned educational institutions, including the University of Texas at Austin, the University of Maryland, Baltimore and Wake Forest University. The Company’s oncology therapeutics include prospective treatments for pancreatic cancer, acute myeloid leukemia (AML) and acute lymphoblastic leukemia (ALL). The Company is also developing a broad-spectrum antiviral platform, in which the lead compounds have activity in cell-based assays against multiple viruses including Influenza virus, Ebolavirus and Marburg virus, SARS-CoV, MERS-CoV, and SARS-CoV-2, the cause of COVID-19.

 

As a result of the Company’s biotechnology research and development and associated investments and acquisitions, its business portfolio now focuses on the treatment of three different cancers and multiple types of viral infections. The Company’s pancreatic drug candidate, DHA-dFdC, developed at and licensed from the University of Texas at Austin, is a new compound that it hopes will become the next generation of chemotherapy treatment for advanced pancreatic cancer. DHA-dFdC overcomes tumor cell resistance to current chemotherapeutic drugs and is well tolerated in preclinical toxicity tests. Preclinical studies have also indicated that DHA-dFdC inhibits pancreatic cancer cell growth (up to 100,000-fold more potent that gemcitabine, a current standard therapy), targets pancreatic tumors and has demonstrated activities against other cancers. The Company has also executed a Sponsored Research Agreement with UMB to support the development of the technology under the direction of these inventors at UMB. 

 

Note 2. Liquidity and Capital Resources

 

The Company continues to incur ongoing administrative and other expenses, including public company expenses, in excess of corresponding (non-financing related) revenue. While the Company continues to implement its business strategy, it intends to finance its activities through managing current cash on hand from the Company’s past debt and equity offerings.

 

During the first quarter of 2021, the Company consummated a public offering of 53,905,927 shares of common stock (including the underwriter overallotment). The Company received net proceeds of approximately $78.0 million after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. Based upon projected cash flow requirements, the Company has adequate cash to fund its operations for at least the next twelve months from the date of the issuance of these consolidated financial statements.

 

Note 3. Summary of Significant Accounting Policies

 

Basis of Presentation and Principles of Consolidation

 

The accompanying unaudited condensed consolidated interim financial statements include the accounts of the Company and its wholly-owned subsidiaries, Nuta Technology Corp. (“Nuta”), Spherix Portfolio Acquisition II, Inc. (“SPAII”), Guidance IP, LLC (“Guidance”), Directional IP, LLC (“Directional”), Spherix Management Services, LLC (“SMS”), Spherix Delaware Merger Sub Inc. (“Merger Sub”), Spherix Merger Subsidiary, Inc (“SMSI”) and NNPT, LLC (“NNPT”). All significant intercompany balances and transactions have been eliminated in consolidation.

 

6

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with the accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and pursuant to the instructions to Form 10-Q and Article 8 of Regulation S-X of the Securities and Exchange Commission (“SEC”) and on the same basis as the Company prepares its annual audited consolidated financial statements. The condensed consolidated balance sheet as of September 30, 2021, condensed consolidated statements of operations for the three and nine months ended September 30, 2021 and 2020, condensed consolidated statements of stockholders’ equity for the three and nine months ended September 30, 2021 and 2020, and the condensed consolidated statements of cash flows for the nine months ended September 30, 2021 and 2020 are unaudited, but include all adjustments, consisting only of normal recurring adjustments, which the Company considers necessary for a fair presentation of the financial position, operating results and cash flows for the periods presented. The results for the three and nine months ended September 30, 2021 are not necessarily indicative of results to be expected for the year ending December 31, 2021 or for any future interim period. The condensed consolidated balance sheet at December 31, 2020 has been derived from audited financial statements; however, it does not include all of the information and notes required by U.S. GAAP for complete financial statements. The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2020 and notes thereto included in the Company’s annual report on Form 10-K, which was filed with the SEC on March 25, 2021.

  

Use of Estimates

 

The accompanying condensed consolidated financial statements have been prepared in conformity with US GAAP. This requires management to make estimates and assumptions that affect certain reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period. The Company’s significant estimates and assumptions include stock-based compensation, the valuation of investments, the valuation of convertible note and the valuation allowance related to the Company’s deferred tax assets. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates and assumptions.

 

Significant Accounting Policies

 

Other than as described below, there have been no material changes in the Company’s significant accounting policies to those previously disclosed in the Company’s annual report on Form 10-K, which was filed with the SEC on March 25, 2021.

 

Fair Value Option - Convertible Note

 

The guidance in ASC 825, Financial Instruments, provides a fair value option election that allows entities to make an irrevocable election of fair value as the initial and subsequent measurement attribute for certain eligible financial assets and liabilities. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The decision to elect the fair value option is determined on an instrument-by-instrument basis and must be applied to an entire instrument and is irrevocable once elected. Assets and liabilities measured at fair value pursuant to this guidance are required to be reported separately in our condensed consolidated balance sheets from those instruments using another accounting method.

 

Deposits

 

In April 2021, the Company deposited $5 million with a fund to identify opportunities to expand the Company’s core business strategies in Asia. The cash are held in bank accounts on behalf of the Company until the fund manager identifies investments. During the nine and three months ended September 30, 2021, the Company incurred advisory fees of approximately $0.6 million and $56,000, respectively, and the balance held in cash in this fund was $4.4 million as of September 30, 2021.

 

Recently Adopted Accounting Standards

 

In December 2019, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which is intended to simplify various aspects related to accounting for income taxes. ASU 2019-12 removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. The Company adopted ASU No. 2019-12 effective January 1, 2021, and the adoption did not have a material impact on its consolidated financial statements.

 

7

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 4. License agreement with Silo Pharma Inc.

 

Effective January 5, 2021, the Company entered into an exclusive patent license agreement (the “License Agreement”) with Silo Pharma Inc., a Delaware corporation and Silo Pharma Inc., a Florida corporation, and their affiliates/subsidiaries (collectively, “Silo Pharma”). On April 12, 2021, the Company entered into an amendment to the License Agreement (“Amendment”). The Amendment amended a portion of the license fees included in the original License Agreement and exchange 500 shares of the Company’s Series M Convertible Preferred Stock to an aggregate of 625,000 restricted shares of the Company’s common stock, par value $0.001 per share, effective as of January 5, 2021. The Company paid a one-time nonrefundable cash payment of $0.5 million to Silo Pharma. The Company shall also pay Silo Pharma a running royalty equal to 2% of “net sales” (as such term is defined in the License Agreement). Running royalties are amounts paid to the licensor over time based on the revenue earned by the licensee from sales of products that embody the licensed IP, if any.

 

Note 5. Investments in Marketable Securities

 

The realized gain or loss, unrealized gain or loss, and dividend income related to marketable securities for the three and nine months ended September 30, 2021 and 2020, which are recorded as a component of gains and (losses) on marketable securities on the consolidated statements of operations (excluding a $70,000 distribution to CBM shareholders during the nine months ended September 30, 2020), are as follows ($ in thousands):

 

   For the Three Months Ended
September 30,
   For the Nine Months Ended
September 30,
 
   2021   2020   2021   2020 
Realized gain (loss)  $(583)  $(447)  $501   $97 
Unrealized loss   (2,901)   (166)   (4,296)   (781)
Dividend income   451    180    1,221    439 
Interest income   
-
    
-
    
-
    4 
   $(3,033)  $(433)  $(2,574)  $(241)

 

Note 6. Short-term investment - investment in Hoth Therapeutics, Inc.

 

The following summarizes the Company investment in Hoth as of September 30, 2021:

 

Security Name  Shares
Owned
as of
September 30,
2021
   Fair value
per Share
as of
September 30,
2021
   Fair value
as of
September 30,
2021
(in thousands)
 
HOTH   1,166,415   $1.19   $1,388 

 

8

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 7. Short-term investment - investment in DatChat, Inc.

 

DatChat, Inc. (“DatChat”) is a communications software company that gives users the ability to communicate with privacy and protection.

 

On August 17, 2021, DatChat closed its initial public offering (the “IPO”) at an initial offering price to the public of $4.15 per share under the ticker DATS. The Company records this investment at fair value and records any change in fair value in the statements of operations (see Note 9).

 

On September 22, 2021, the Company entered into a certain Stock Transfer Agreement, by and between the Company and a purchaser, and sold 167,084 shares of DatChat common stock for net proceeds of approximately $0.9 million.

 

The following summarizes the Company investment in DatChat as of September 30, 2021:

 

Security Name  Shares
Owned
as of
September 30,
2021
   Fair value
per Share
as of
September 30,
2021
   Fair value
as of
September 30,
2021
(in thousands)
 
DATS   357,916   $13.65   $4,886 

 

Note 8. Other Investments

 

The Company has made an accounting policy election to adopt an adjusted cost method measurement alternative for the below investments pursuant to ASU 2016-01.

 

Investment in Kerna Health Inc

 

On September 15, 2021, the Company entered into a securities purchase agreement (the “Kerna Securities Purchase Agreement”) with Kerna Health Inc., (“Kerna”). Under the Kerna Securities Purchase Agreement, the Company agreed to purchase 1,333,334 shares of common stock of Kerna for $1.0 million.

 

Investment in Kaya Holding Corp

 

On September 29, 2021, the Company entered into a securities purchase agreement (the “Kaya Securities Purchase Agreement”) with Kaya Holding Corp., (“Kaya”). Under the Kaya Securities Purchase Agreement, the Company agreed to purchase 8,325,000 shares of common stock of Kaya for approximately $0.7 million.

 

Investment in Tevva Motors

 

On September 22, 2021, the Company entered into a securities purchase agreement (the “Tevva Motors Subscription Agreement”) with Big Sky Opportunities Fund, LLC, who handled the offering for Tevva Motors. Under the Tevva Motors Subscription Agreement, the Company agreed to purchase 29,004 Interests of Tevva Motors for approximately $1.0 million. Subsequently, on September 30, 2021, the Company entered into a second securities purchase agreement with Big Sky Opportunities Fund, LLC to purchase an additional 29,004 Interests of Tevva Motors for approximately $1.0 million.

 

9

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Investment in Slinger Bag Inc

 

On August 6, 2021, the Company entered into a securities purchase agreement (the “Slinger Bag Securities Purchase Agreement”) with Slinger Bag Inc., (“Slinger Bag”). Under the Slinger Bag Securities Purchase Agreement, the Company agreed to pay $1.4 million to Slinger Bag for the issuance of a convertible promissory note in the principal amount of $1.4 million and a common stock purchase warrant.

 

Note 9. Fair Value of Financial Assets and Liabilities

 

Financial instruments, including cash and cash equivalents, accounts payable and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments. The Company measures the fair value of financial assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value.

 

The Company uses three levels of inputs that may be used to measure fair value:

 

Level 1 - quoted prices in active markets for identical assets or liabilities

 

Level 2 - quoted prices for similar assets and liabilities in active markets or inputs that are observable

 

Level 3 - inputs that are unobservable (for example, cash flow modeling inputs based on assumptions)

 

Observable inputs are based on market data obtained from independent sources, while unobservable inputs are based on the Company's market assumptions. Unobservable inputs require significant management judgment or estimation. In some cases, the inputs used to measure an asset or liability may fall into different levels of the fair value hierarchy. In those instances, the fair value measurement is required to be classified using the lowest level of input that is significant to the fair value measurement. Such determination requires significant management judgment.

 

The following table presents the Company’s assets and liabilities that are measured at fair value at September 30, 2021 and December 31, 2020 ($ in thousands):  

 

   Fair value measured at September 30, 2021 
   Total at
September 30,
   Quoted
prices in
active
markets
   Significant
other
observable
inputs
   Significant
unobservable
inputs
 
   2021   (Level 1)   (Level 2)   (Level 3) 
Assets                
Marketable securities:                
Equities  $60,589   $60,589   $
               -
   $
-
 
Mutual fund securities  $16,896   $16,896   $
-
   $
-
 
Unit Investments Trust  $481   $481   $
-
   $
-
 
Special purpose acquisition corps  $2,559   $2,559           
Total marketable securities  $80,525   $80,525   $
-
   $
-
 
Short-term investment  $6,274   $6,274   $
-
   $
-
 
Convertible note receivable  $2,107   $
-
   $
-
   $2,107 

 

   Fair value measured at December 31, 2020 
   Total at
December 31,
   Quoted
prices in
active
markets
   Significant
other
observable
inputs
   Significant
unobservable
inputs
 
   2020   (Level 1)   (Level 2)   (Level 3) 
Assets                
Marketable securities:                
Equities  $24,274   $24,274   $
          -
   $
             -
 
Mutual fund securities  $527   $527   $
-
   $
-
 
Total marketable securities  $24,801   $24,801   $-   $- 
Investments  $2,764   $2,764   $
-
   $
-
 

 

10

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Level 3 Valuation Techniques

 

The following table sets forth a summary of the changes in the fair value of the Company’s Level 3 financial assets that are measured at fair value on a recurring basis ($ in thousands):

 

   Fair Value of Level 3
investment
 
   September 30,
2021
   December 31,
2020
 
Beginning balance  $
-
   $
               -
 
Purchase of convertible note   2,000    
-
 
Accrued interest receivable   107    
-
 
Ending balance  $2,107   $
-
 

 

Convergent Investment

 

On January 29, 2021, the Company purchased an 8% convertible promissory note (“Convertible Note”) issued by Convergent Therapeutics, Inc. (“Convergent”) in the principal amount of $2 million pursuant to a Note Purchase Agreement with Convergent. The Company paid a purchase price for the Convertible Note of $2 million. The Company will receive interest on the Convertible Note at the rate of 8% per annum payable upon conversion or maturity of the Convertible Note. The Convertible Note shall mature on January 29, 2023.

 

The Company has elected to measure the purchase of the Convertible Note from Convergent using the fair value option at each reporting date. Under the fair value option, bifurcation of an embedded derivative is not necessary, and all related gains and losses on the host contract and derivative due to change in the fair value will be reflected in interest income and other, net in the condensed consolidated statements of operations.

 

The Convertible Note is disclosed as a noncurrent Convertible Note investment in the condensed consolidated balance sheets. As of September 30, 2021, the fair value of the Convertible Note was measured at $2.0 million, taking into consideration cost of the investment, market participant inputs, market conditions, liquidity, operating results and other qualitative and quantitative factors. The value at which the Company’s Convertible Note is carried on its books is adjusted to estimated fair value at the end of each quarter, taking into account general economic and stock market conditions and those characteristics specific to the underlying investments. No change in fair value was recorded during the nine months ended September 30, 2021.

 

Interest accrues on the unpaid principal balance on a quarterly basis and is recognized in interest income in the condensed consolidated statements of operations. The Company recorded an interest income receivable of approximately $107,000 on the Convertible Note as of September 30, 2021.

 

Note 10. Net Loss per Share

 

Basic loss per common share is computed by dividing the net loss allocable to common stockholders by the weighted-average number of shares of common stock or common stock equivalents outstanding. Diluted loss per common share is computed similar to basic loss per share except that it reflects the potential dilution that could occur if dilutive securities or other obligations to issue common stock were exercised or converted into common stock. Securities that could potentially dilute loss per share in the future that were not included in the computation of diluted loss per share at September 30, 2021 and 2020 are as follows:

 

   As of As of September 30, 
   2021   2020 
Convertible preferred stock   688    688 
Warrants to purchase common stock   5,801,701    734,501 
Options to purchase common stock   479,654    84,304 
Total   6,282,043    819,493 

 

11

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Note 11. Stockholders’ Equity and Convertible Preferred Stock

 

Public Offering

 

On February 19, 2021, the Company consummated the public offering pursuant to an amended and restated underwriting agreement (the “Underwriting Agreement”) with H.C. Wainwright & Co., LLC, as representative to the underwriters named therein (the “Underwriter”), pursuant to which the Company agreed to issue and sell to the Underwriter in an underwritten public offering (the “Offering”) an aggregate of 46,875,000 shares (the “Shares”) of common stock, $0.0001 par value per share, of the Company (the “Common Stock”). The Company received gross proceeds of approximately $75 million before deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. On February 23, 2021, the Underwriter partially exercised its over-allotment option and purchased an additional 7,030,927 Shares, resulting in aggregate proceeds of approximately $86.2 million, before deducting underwriting discounts and commissions and other expenses. The total net proceeds received from these two offerings were approximately $78.0 million.

 

In connection with the Offering, the Company issued the Underwriter warrants (the “Underwriter’s Warrants”) to purchase up to 4,312,473 shares of Common Stock, or 8% of the Shares sold in the Offering. The Underwriter’s Warrants will be exercisable for a period of five years from February 19, 2021 at an exercise price of $2.00 per share, subject to adjustment.

 

Warrants

 

A summary of warrant activity for the nine months ended September 30, 2021 is presented below:

 

   Warrants   Weighted
Average
Exercise
Price
   Total
Intrinsic
Value
   Weighted
Average
Remaining
Contractual
Life
(in years)
 
Outstanding as of December 31, 2020   1,723,020   $3.07    57,333    1.11 
Issued   4,312,473    2.00    
-
    4.39 
Exercised   (80,000)   1.05    
-
    - 
Expired   (153,789)   19.67    
-
    - 
Forfeited   (3)   16.15    
-
    - 
Outstanding as of September 30, 2021   5,801,701   $1.86    53,999    4.12 

 

Stock Options

 

A summary of stock option activity for the nine months ended September 30, 2021 is presented below:

 

   Number of
Shares
   Weighted
Average
Exercise
Price
   Total
Intrinsic
Value
   Weighted
Average
Remaining
Contractual
Life
(in years)
 
Outstanding as of December 31, 2020   384,304   $40.15   $69,000    8.9 
Employee options granted   100,000    1.24    
-
    9.3 
Employee options expired   (4,650)   
-
    
-
    - 
Outstanding as of September 30, 2021   479,654   $32.35   $54,000    8.5 
Options vested and exercisable   479,654   $32.35   $54,000    8.5 

 

12

 

 

AIKIDO PHARMA INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

 

Stock-based compensation associated with the amortization of stock option expense was approximately $6,000 and $0 for the three months ended September 30, 2021 and 2020, respectively. Stock-based compensation associated with the amortization of stock option expense was approximately $0.2 million and $0 for the nine months ended September 30, 2021 and 2020, respectively. All stock compensation was recorded as a component of general and administrative expenses.

 

Estimated future stock-based compensation expense relating to unvested stock options is approximately $0.

 

Restricted Stock Awards

 

Pursuant to the patent license agreement effective January 5, 2021 with Silo Parma Inc., the Company issued and delivered to Silo Pharma 625,000 shares of the Company’s restricted stock as consideration for the license of the licensed patents. This restricted stock award vested immediately. The Company recorded approximately $0.5 million in research and development expense related with license acquired during the nine months ended September 30, 2021 related to this arrangement.

 

On July 31, 2021, the Company issued each of six directors 25,000 shares of the Company’s common stock pursuant to the Company’s 2020 Equity Incentive Plan. These shares have a total fair value of approximately $0.1 million. These restricted stock awards vested immediately.

 

Note 12. Commitments and Contingencies

 

Legal Proceedings

 

In the past, in the ordinary course of business, the Company actively pursued legal remedies to enforce its intellectual property rights and to stop unauthorized use of our technology. Other than ordinary routine litigation incidental to the business, we know of no material, active or pending legal proceedings against us.

 

Risks and Uncertainties – COVID-19

 

Management continues to valuate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s financial position, results of its operations and/or search for drug candidates, the specific impact is not readily determinable as of the date of these consolidated financial statements. The COVID-19 pandemic has slowed down some drug development efforts and has slowed the acquisition of new drugs. However, the impact of the pandemic and ensuing lockdowns are easing. The process of drug development and further acquisitions is now continuing. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Note 13. Subsequent Events

 

The Company evaluated events that have occurred after the balance sheet date through the date the condensed consolidated financial statements were issued. Based upon the evaluation and transactions, the Company did not identify any other subsequent events that would have required adjustment or disclosure in the condensed consolidated financial statements.

 

13

 

 

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

 

Forward-Looking Statements

 

You should read this discussion together with the Financial Statements, related Notes and other financial information included elsewhere in this Form 10-Q. The following discussion contains assumptions, estimates and other forward-looking statements that involve a number of risks and uncertainties. These risks could cause our actual results to differ materially from those anticipated in these forward-looking statements. All references to “we,” “us,” “our” and the “Company” refer to Aikido Pharma Inc., a Delaware corporation and its consolidated subsidiaries unless the context requires otherwise.

 

Overview

 

AIkido Pharma Inc. was initially formed in 1967. Since 2017, the Company has operated as a biotechnology company with a diverse portfolio of small-molecule anticancer and antiviral therapeutics in development. The Company’s pipeline consists of patented technology from leading universities and researchers. We are currently in the process of developing our innovative therapeutic drug pipeline through strong partnerships with world renowned educational institutions, including the University of Texas at Austin, the University of Maryland, Baltimore and Wake Forest University. Our oncology therapeutics include treatments for pancreatic cancer, acute myeloid leukemia (AML) and acute lymphoblastic leukemia (ALL). The Company is also developing a broad-spectrum antiviral platform, in which the lead compounds have activity against multiple viruses including Influenza virus, Ebolavirus and Marburg virus, SARS-CoV, MERS-CoV, and SARS-CoV-2, the cause of COVID-19.

 

As a result of the Company’s biotechnology research and development and associated investments and acquisitions, our business portfolio now focuses on the treatment of three different cancers and multiple types of viral infections. Our pancreatic drug candidate, DHA-dFdC, developed at and licensed from the University of Texas at Austin, is a new compound that we hope will become the next generation of chemotherapy treatment for advanced pancreatic cancer. DHA-dFdC overcomes tumor cell resistance to current chemotherapeutic drugs and is well tolerated in preclinical toxicity tests. Preclinical studies have also indicated that DHA-dFdC inhibits pancreatic cancer cell growth (up to 100,000-fold more potent that gemcitabine, a current standard therapy), targets pancreatic tumors and has demonstrated activities against other cancers, including leukemia, lung and melanoma. Our AML and ALL compound, developed at the Wake Forest University, is a targeted therapeutic designed to overcome multiple resistance mechanisms observed with the current standard of care.

 

Our broad-spectrum antiviral platform was developed at the University of Maryland Baltimore (“UMB”), which granted the Company an exclusive worldwide Master License Agreement (MLA”) to technology covered by three separate patent applications. The licensed technology comprises broadly acting pan-viral inhibitory compounds targeting multiple viral pathogens. The technology was invented by UMB scientists Drs. Matthew Frieman, Alexander MacKerell and Stuart Watson. The Company has also executed a Sponsored Research Agreement with UMB to support the development of the technology under the direction of these inventors at UMB.

 

In addition, we are constantly seeking to grow our pipeline of treatments in oncology indications. For example, in January 2021, the Company invested in Convergent Therapeutics, Inc., which has exclusive rights to technology related to next-generation dual-action peptide receptor radionuclide therapy (“PRRT”) for prostate cancer covered by multiple issued U.S. and foreign patents. Convergent is currently conducting advanced human trials relating to prostate cancer treatments utilizing PRRT that targets the prostate-specific membrane antigen (“PSMA”) present on prostate cancer cells. The technology was developed under the direction of Dr. Neil Bander, Professor of Urologic Oncology at Weill Cornell Medicine. In addition, the Company was granted a license to four patent applications for the use of psilocybin in cancer indications.

 

Additionally, on January 6, 2021 the Company announced that it entered into an exclusive patent license agreement with Silo Pharma Inc. (“Silo Pharma”) pursuant to which Silo Pharma granted the Company a worldwide exclusive, sublicensable, royalty-bearing license to certain Silo Pharma owned provisional patent applications directed to the use of psilocybin in cancer treatment, and any patents issuing therefrom, including all continuations, continuations-in-part, divisions, extensions, substitutions, reissues, re-examinations, and any applications and all patents issuing from any applications and patents that claim domestic benefit or foreign priority to the provisional patent applications. The license is for “Field of Use” (as defined in the exclusive patent license agreement) of “treatment of cancer and symptoms caused by cancer, including but not limited to pain, nausea, neuroinflammation, brain and neural dysfunction, depression, seizures, confusion, dizziness, numbness/tingling, dysfunction of the senses and all other symptoms that are caused by cancer of any type.”

 

14

 

 

Critical Accounting Policies

 

Our critical accounting policies are disclosed in our annual report on Form 10K for the year ended December 31, 2020 and there have been no material changes to such policy or estimates during the nine months ended September 30, 2021.

 

Recently Issued Accounting Pronouncements

 

See Note 3 to the condensed consolidated financial statements for a discussion of recent accounting standards.

 

Results of Operations

 

Three months ended September 30, 2021 compared to three months ended September 30, 2020

 

During the three months ended September 30, 2021, we incurred a loss from operations of approximately $1.8 million, as compared to $1.0 million during the comparable prior year period. The increase in loss was primarily attributed to $0.9 million increase in in general and administrative expenses, partially offset by $91,000 million decrease research and development expense and $38,000 decrease in research and development expense related with license acquisition.

 

During the three months ended September 30, 2021, other income was approximately $1.7 million as compared to other expense of approximately $1.1 million during the comparable prior year period. The net loss per share decreased from a decrease in net operating losses and a significant increase in the number of shares outstanding. The increase in other income was primarily attributed to a $5.3 million increase in the change in fair value of investment in DatChat and a decrease in the change in fair value of investment in Hoth, and partially offset by $2.6 million increase in loss on marketable securities.

 

The Company experienced very little or no revenue in the last two years and we don’t expect any revenue until a biotechnology product is fully developed which may not occur for many years.

 

Nine months ended September 30, 2021 compared to nine months ended September 30, 2020

 

During the nine months ended September 30, 2021, we incurred a loss from operations of approximately $6.9 million, as compared to a loss of $5.2 million during the comparable prior year period. The increase in loss was primarily attributed to $2.2 million increase in general and administrative expenses, and partially offset by $0.5 million decrease in research and development expense $26,000 decrease in research and development expense related to the license acquisition.

 

During the nine months ended September 30, 2021, other income was approximately $1.5 million as compared to other expense of approximately $7.5 million during the comparable prior year period. The net loss per share decreased from a decrease in net operating losses and a significant increase in the number of shares outstanding. The increase in other income was primarily attributed to a $11.2 million increase in the change in fair value of investment in DatChat, decrease in the change in fair value of investment in Hoth, and partially offset by $2.4 million increase in loss on marketable securities.

 

The Company experienced very little or no revenue in the last two years and we don’t expect any revenue until a biotechnology product is fully developed which may not occur for many years.

 

15

 

 

Liquidity and Capital Resources

 

We continue to incur ongoing administrative and other expenses, including public company expenses, in excess of corresponding (non-financing related) revenue. We do not expect to incur revenue until any of our biotechnology products are fully developed. While we continue to implement our business strategy, we intend to finance our activities through managing current cash on hand from our past equity offerings.

 

During the nine months of 2021, the Company consummated a public offering of 53,905,927 shares of common stock (including the underwriter overallotment). The Company received net proceeds of approximately $78.0 million after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. Therefore, the Company has adequate cash to fund its operations for at least the next twelve months.

 

Moving forward, the Company intends to manage its cash through an investment committee focused on asset preservation and reasonable risk allocation. Further, the Company intends to grow its drug platform through additional licensing efforts that are similar to those the Company has already entered into and disclosed. In addition, the Company is seeking partnerships with academic institutions and private enterprise to find, fund and advance new drug compounds that can be brought to commercialization.

 

Management continues to evaluate the impact of the COVID-19 pandemic on the industry and has concluded that while it is reasonably possible that the virus could have a negative effect on the Company’s consolidated financial position, results of its consolidated operations and/or search for drug candidates, the specific impact is not readily determinable as of the date of these consolidated financial statements. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

On August 10, 2021, the Company received a staff deficiency notice from The Nasdaq Stock Market (“Nasdaq”) informing the Company that its common stock failed to comply with the $1.00 minimum bid price required for continued listing on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2). Nasdaq’s letter advised the Company that, based upon the closing bid price during the period from June 28, 2021 to August 9, 2021, the Company no longer meets this test.

 

Pursuant to Nasdaq Marketplace Rule 5810(c)(3)(A), the Company has been provided with a compliance period of 180 calendar days, or February 7, 2022, to regain compliance with the minimum bid price requirement. To regain compliance, the closing bid price of the Company’s common stock must meet or exceed $1.00 per share for a minimum of 10 consecutive business days prior to February 7, 2022.

 

Cash Flows from Operating Activities - For the nine months ended September 30, 2021 and 2020, net cash used in operations was approximately $4.6 million and $3.6 million, respectively. The cash used in operating activities for the nine months ended September 30, 2021 primarily resulted from a net loss of $5.4 million and change in fair value of investment of $3.8 million, and partially offset by $4.3 million unrealized loss on marketable securities and $1.1 million research and development expense related with license acquired. The cash used in operating activities for the nine months ended September 30, 2020 primarily resulted from a net loss of $12.7 million, and partially offset by reduction in fair value of investment of $7.4 million and $1.2 million research and development expense related with license acquired.

 

Cash Flows from Investing Activities - For the nine months ended September 30, 2021 and 2020, net cash used in investing activities was approximately $70.3 million and $27.2 million, respectively. The cash used in investing activities for the nine months ended September 30, 2021 primarily resulted from our purchase of marketable securities of $90.5 million, funds to deposit accounts of $4.4 million (net of fee), purchase of investments at fair value of $4.1 million and purchase of convertible note of $2.0 million, partially offset by our sale of marketable securities of $30.4 million since we invest excess cash into marketable securities until additional cash is needed. The cash used in investing activities for the nine months ended September 30, 2020 primarily resulted from our purchase of marketable securities of $98.5 million and research and development expense related with license acquired of $1.2 million, partially offset by our sale of marketable securities of $72.0 million since we invest excess cash into marketable securities until additional cash is needed.

 

Cash Flows from Financing Activities - Cash provided by financing activities for the nine months ended September 30, 2021 was $78.1 million, which reflects the net proceeds of $78.0 million from investors in exchange of issuance of common stock and warrants and net proceeds of $84,000 from the exercise of common warrants. Cash provided by financing activities for the nine months ended September 30, 2020 was $31.6 million, which reflects the net proceeds of $6.6 million from investors in exchange of issuance of common stock, common warrants and prefunded warrants, net proceeds of $17.8 million from investors in exchange of issuance of common stock, and net proceeds of $7.2 million from the exercise of common warrants and prefunded warrants.

 

16

 

 

Off-balance sheet arrangements.

 

None.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk

 

Not required for smaller reporting companies.

 

Item 4. Controls and Procedures

 

Disclosure Controls and Procedures

 

We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, 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 the 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.

 

With respect to the quarter ended September 30, 2021, under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures. Based upon this evaluation, our Chief Executive Officer has concluded that our disclosure controls and procedures were not effective as of September 30, 2021 due to the material weaknesses in our internal controls over financial reporting. We have a lack of segregation of duties, and a lack of controls in place to ensure that all material transactions and developments impacting the financial statements are reflected.

 

Changes in Internal Control over Financial Reporting:

 

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the fiscal quarter ended September 30, 2021 which have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

17

 

 

Part II. Other Information

 

Item 1. Legal Proceedings

 

In the past, in the ordinary course of business, we actively pursued legal remedies to enforce our intellectual property rights and to stop unauthorized use of our technology. Other than ordinary routine litigation incidental to the business, we know of no material, active or pending legal proceedings against us.

 

Item 1A. Risk Factors

 

There have been no material changes in our risk factors from those disclosed in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and in our Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2021.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 6. Exhibits

 

31.1   Certification of Principal Executive Officer and Principal Financial Officer of AIkido Pharma Inc. pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1   Certification of Principal Executive Officer and Principal Financial Officer of AIkido Pharma Inc. pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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 Label Linkbase Document.
101.PRE   Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104   Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

 

18

 

 

Signatures

 

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

 

  Aikido Pharma Inc.
  (Registrant)
     
Date: November 10, 2021 By: /s/ Anthony Hayes
    Anthony Hayes
    Chief Executive Officer
    (Principal Executive Officer,
Principal Financial Officer and
Principal Accounting Officer)

 

 

19