Klotho Neurosciences Inc

Previous wording

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

Current wording

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

Previous wording

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

Current wording

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

Previous wording

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

Current wording

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

Previous wording

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

Current wording

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

Previous wording

Results of Operations for the Three and Six Months Ended June 30, 2024 Compared to the Three and Six Months Ended June 30, 2023

Current wording

Results of Operations for the Three and Nine Months Ended September 30, 2024 Compared to the Three and Nine Months Ended September 30, 2023

Previous wording

The Company had no revenue for the six month ended June 30, 2024 and June 30, 2023.

Current wording

The Company had no revenue for the nine months ended September 30, 2024 and September 30, 2023.

Previous wording

Our operating expenses for the three months ended June 30, 2024 were $395,607 compared to $244,252 for the three months ended June 30, 2023, an increase of $151,355 or approximately 62%. The increase was primarily due to increased expenses associated with preparing for our business combination including increases in third party consulting fees and professional fees.

Current wording

Our operating expenses for the nine months ended September 30, 2024 were $3,688,584 compared to $520,589 for the nine months ended September 30, 2023, an increase of $3,167,995. The increase was primarily due to increased share-based compensation expense as well as expenses associated with our business combination including increases in third party consulting fees and professional fees.

Previous wording

For the six months ended June 30, 2024, we incurred a net loss of $1,123,683 compared to a net loss of $436,872 for the six month period ended June 30, 2023, an increase of $686,811 or approximately 157%. The increase in net loss was primarily due to increased expenses associated with preparing for our business combination including increases in third party consulting fees and professional fees.

Current wording

For the three months ended September 30, 2024, we incurred a net loss of $2,959,426 compared to a net loss of $144,111 for the three month period ended September 30, 2023. The increase in net loss was primarily due to increased share-based compensation expense.

Previous wording

For the three months ended June 30, 2024, we incurred a net loss of $451,639 compared to a net loss of $264,389 for the three month period ended June 30, 2023, an increase of $187,250 or approximately 71%. The increase in net loss was primarily due to increased expenses associated with preparing for our business combination including increases in third party consulting fees and professional fees.

Current wording

For the nine months ended September 30, 2024, we incurred a net loss of $4,083,109 compared to a net loss of $580,983 for the nine month period ended September 30, 2023, an increase of $3,502,126. The increase in net loss was primarily due to increased stock-based compensation expense as well as expenses associated with preparing for our business combination including increases in third party consulting fees and professional fees.

Previous wording

Net cash used in operating activities for the six months ended June 30, 2024 was $929,399, compared to $265,429, for the six months ended June 30, 2023, an increase of $663,970 or approximately 250%. The significant increase in cash used in operating activities is primarily attributable to increases in expenses as we prepared to close our business combination. We expect net cash from operating activities to be negative in the coming periods, until our products are able to produce meaningful revenue.

Current wording

Net cash used in operating activities for the nine months ended September 30, 2024 was $2,002,358, compared to $247,406, for the nine months ended September 30, 2023, an increase of approximately $1,755,000. The significant increase in cash used in operating activities is primarily attributable to increases in expenses related to the business combination and continued operating costs. We expect net cash used in operating activities to increase in the coming periods, until our products are able to produce meaningful revenue.

Previous wording

Net cash used in investing activities for the six months ended June 30, 2024 was $123,497, compared to $20,000 for the six months ended June 30, 2023, an increase of $103,497 or approximately 517%. The increase in cash used in investing activities is primarily attributable to licensing payments made in the period.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2024 was $123,497, compared to $76,325 for the nine months ended September 30, 2023, an increase of approximately $47,000. The increase in cash used in investing activities is primarily attributable to licensing payments made in the period.

Previous wording

Net cash provided by financing activities for the six months ended June 30, 2024 was $1,895,424, which consisted of investments and proceeds from the Business Combination. For the six months ended June 30, 2023, net cash provided by financing activities was $250,000, primarily from the sale of the Company’s common stock and promissory notes to investors.

Current wording

Net cash provided by financing activities for the nine months ended September 30, 2024 was $2,173,942, which consisted of investments, proceeds from the business combination, as well as proceeds from related parties. For the nine months ended September 30, 2023, net cash provided by financing activities was $250,000, from repayment of an advance to a shareholder.

Previous wording

As of June 30, 2024, the Company had cash of $845,336 and net working capital of $101,273.

Current wording

As of September 30, 2024, the Company had cash of $50,895 and net working capital of ($827,783).

Previous wording

The accompanying consolidated financial statements have been prepared as if the Company will continue as a going concern. The Company has incurred significant operating losses and negative cash flows from operations since inception. As of June 30, 2024, the Company had cash of approximately $845,000 and an accumulated deficit of approximately $5.5 million. The Company has incurred recurring losses, has experienced recurring negative operating cash flows, and requires significant cash resources to execute its business plans. The Company is dependent on obtaining additional working capital funding from the sale of equity and/or debt securities in order to continue to execute its development plans and continue operations. Without additional funding, there is substantial doubt about the Company’s ability to continue as a going concern for twelve months from the date of these financial statements.

Current wording

The accompanying consolidated financial statements have been prepared as if the Company will continue as a going concern. The Company has incurred significant operating losses and negative cash flows from operations since inception. As of September 30, 2024, the Company had cash of approximately $51,000 and an accumulated deficit of approximately $8.5 million. The Company has incurred recurring losses, has experienced recurring negative operating cash flows, and requires significant cash resources to execute its business plans. The Company is dependent on obtaining additional working capital funding from the sale of equity and/or debt securities in order to continue to execute its development plans and continue operations. Without additional funding, there is substantial doubt about the Company’s ability to continue as a going concern for twelve months from the date of these financial statements.