Quoin Pharmaceuticals Ltd

Previous wording

We are a clinical stage specialty pharmaceutical company dedicated to the development and commercialization of therapeutic products that treat rare and orphan diseases for which there are currently no approved treatments or cures. Our initial focus is on the development of products, using our proprietary owned and in-licensed drug delivery technologies, that could help address rare skin diseases. Our first lead product is QRX003, a once daily, topical lotion comprised of a broad-spectrum serine protease inhibitor, formulated with the proprietary in-licensed Invisicare® technology, is under development as a potential treatment for Netherton Syndrome (“NS”), a rare hereditary genetic disease. QRX003 is currently being tested in two clinical studies in the United States (“U.S.”) under an open Investigational New Drug (“IND”) application with the Food and Drug Administration (“FDA”). We are also developing QRX004 as a potential treatment for Recessive Dystrophic Epidermolysis Bullosa (“RDEB”). In addition, we entered into Research Agreements with the Queensland University of Technology (“QUT”), under which we have obtained an option for global licenses to QRX007 for the potential treatment of NS and QRX008 for the potential treatment of scleroderma, and with University College Cork (“UCC”) for the development of novel topical formulations of Rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently no approved therapies or cures.

Current wording

We are a clinical stage specialty pharmaceutical company dedicated to the development and commercialization of therapeutic products that treat rare and orphan diseases for which there are currently no approved treatments or cures. Our initial focus is on the development of products, using our proprietary owned and in-licensed drug delivery technologies, that could help address rare skin diseases. Our first lead product is QRX003, a once daily, topical lotion comprised of a broad-spectrum serine protease inhibitor, formulated with the proprietary in-licensed Invisicare® technology, is under development as a potential treatment for Netherton Syndrome (“NS”), a rare hereditary genetic disease. QRX003 is currently being tested in two clinical studies in the United States (“U.S.”) under an open Investigational New Drug (“IND”) application with the Food and Drug Administration (“FDA”). We are also developing QRX004 as a potential treatment for Recessive Dystrophic Epidermolysis Bullosa (“RDEB”). In addition, we entered into Research Agreements with the Queensland University of Technology (“QUT”), under which we have obtained an option for global licenses to QRX007 for the potential treatment of NS and QRX008 for the potential treatment of scleroderma, and with the University College Cork (“UCC”) for the development of novel topical formulations of Rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently no approved therapies or cures.

Previous wording

Effective July 18, 2023, the ratio of ADSs evidencing ordinary shares changed from 1 ADS representing five thousand (5,000) ordinary shares to 1 ADS representing sixty thousand (60,000) ordinary shares, which resulted in a 1 for 12 reverse split of the issued and outstanding ADSs. Effective November 8, 2023, the Company completed a 1 for 60,000 reverse split of the ordinary shares which resulted in the ratio of ADSs evidencing ordinary shares to be changed from 1 ADS representing sixty thousand (60,000) ordinary shares to 1 ADS representing one (1) ordinary share. Except as specifically provided, ordinary share, ADS and related option and warrant information presented herein, including our unaudited condensed consolidated financial statements and accompanying footnotes, has been retroactively adjusted to reflect the number of ordinary shares and ADSs resulting from the aforementioned ordinary share reverse split and ADS ratio changes.

Current wording

Effective July 18, 2023, the ratio of ADSs evidencing ordinary shares changed from 1 ADS representing five thousand (5,000) ordinary shares to 1 ADS representing sixty thousand (60,000) ordinary shares, which resulted in a 1 for 12 reverse split of the issued and outstanding ADSs. Effective November 8, 2023, we completed a 1 for 60,000 reverse split of the ordinary shares which resulted in the ratio of ADSs evidencing ordinary shares to be changed from 1 ADS representing sixty thousand (60,000) ordinary shares to 1 ADS representing one (1) ordinary share. Except as specifically provided, ordinary share, ADS and related option and warrant information presented herein, including our unaudited condensed consolidated financial statements and accompanying footnotes, has been retroactively adjusted to reflect the number of ordinary shares and ADSs resulting from the aforementioned ordinary share reverse split and ADS ratio changes.

Previous wording

On June 27, 2024 we announced that we will expand our ongoing Netherton Syndrome clinical studies to include international sites. The first international site will be opened at a research hospital in Saudi Arabia. This hospital is currently treating a number of Netherton patients who will now become eligible for recruitment into our studies. An experienced Clinical Research Organization has been engaged to manage the study locally. The Saudi site will operate under the auspices of our open Investigational New Drug (IND) application with the US Food and Drug Administration. Plans to open additional international clinical sites are at an advanced stage.

Current wording

On June 27, 2024 we announced that we will expand our ongoing Netherton Syndrome clinical studies to include international sites. The first international site will be opened at a research hospital in Saudi Arabia. This hospital is currently treating a number of Netherton patients who will now become eligible for recruitment into our studies. An experienced Clinical Research Organization has been engaged to manage the study locally.

Previous wording

On March 7, 2024, (the “2024 Closing Date”) we completed an offering (the “2024 Offering”) of the following securities (i) 811,250 ordinary shares represented by ADSs, (ii) 4,062,500 Series D warrants (the “Series D Warrants”) to purchase 4,062,500 ordinary shares represented by ADSs, (iii) 4,062,500 Series E warrants (the “Series E Warrants” and together with the Series D Warrants, the “2024 Warrants”) to purchase 4,062,500 ordinary shares represented by ADSs, and (iv) 3,251,250 pre-funded warrants (the “2024 Pre-Funded Warrants”) to purchase 3,251,250 ordinary shares represented by ADSs for aggregate gross proceeds of approximately $6.5 million, resulting in net proceeds of approximately $5.5 million, after deducting the placement agent’s fees and offering expenses paid by us. Each ADS (or 2024 Pre-Funded Warrant to purchase one ADS in lieu thereof) was sold together with a Series D Warrant to purchase one ADS and a Series E Warrant to purchase one ADS. The ADSs and accompanying 2024 Warrants were sold at a combined public offering price of $1.60 and the 2024 Pre-Funded Warrants and accompanying 2024 Warrants were sold at a combined public offering price of $1.5999, which is equal to the combined purchase price per ADS and accompanying 2024 Warrants, minus the exercise price of each 2024 Pre-Funded Warrant of $0.0001. The Series D Warrants and the Series E Warrants have an exercise price of $1.60 per share, were exercisable immediately following the closing of the 2024 Offering and expire in two years and five years, respectively, from the closing of the 2024 Offering. As of June 30, 2024 2,181,500 2024 Pre-Funded Warrants have been exercised and are included in issued and outstanding ADSs.

Current wording

On March 7, 2024, (the “2024 Closing Date”) we completed an offering (the “2024 Offering”) of the following securities (i) 811,250 ordinary shares represented by ADSs, (ii) 4,062,500 Series D warrants (the “Series D Warrants”) to purchase 4,062,500 ordinary shares represented by ADSs, (iii) 4,062,500 Series E warrants (the “Series E Warrants” and together with the Series D Warrants, the “2024 Warrants”) to purchase 4,062,500 ordinary shares represented by ADSs, and (iv) 3,251,250 pre-funded warrants (the “2024 Pre-Funded Warrants”) to purchase 3,251,250 ordinary shares represented by ADSs for aggregate gross proceeds of approximately $6.5 million, resulting in net proceeds of approximately $5.5 million, after deducting the placement agent’s fees and offering expenses paid by us. Each ADS (or 2024 Pre-Funded Warrant to purchase one ADS in lieu thereof) was sold together with a Series D Warrant to purchase one ADS and a Series E Warrant to purchase one ADS. The ADSs and accompanying 2024 Warrants were sold at a combined public offering price of $1.60 and the 2024 Pre-Funded Warrants and accompanying 2024 Warrants were sold at a combined public offering price of $1.5999, which is equal to the combined purchase price per ADS and accompanying 2024 Warrants, minus the exercise price of each 2024 Pre-Funded Warrant of $0.0001. As of September 30, 2024 all 2024 Pre-Funded Warrants have been exercised and are included in issued and outstanding ADSs. The Series D Warrants and the Series E Warrants have an exercise price of $1.60 per share, were exercisable immediately following the closing of the 2024 Offering and expire in two years and five years, respectively, from the closing of the 2024 Offering.

Previous wording

In connection with the 2024 Offering, we agreed not to sell any ADS to Alumni under the Alumni Purchase agreement for a period of 180 days from the 2024 Closing Date.

Current wording

In connection with the 2024 Offering, we agreed not to sell any ADS to Alumni under the Alumni Purchase agreement for a period of 180 days from the 2024 Closing Date. As of September 30, 2024 we have not filed the required registration statement or sold any ADS to Alumni under the Alumni Purchase Agreement.

Previous wording

On April 29, 2024, we received a letter from the Listing Qualifications staff (the “Staff”) of The Nasdaq Stock Market, LLC (“Nasdaq”) notifying us that the closing bid price per ADS of the Company was below the required minimum of $1.00 for a period of 31 consecutive business days and that we did not meet the minimum bid price requirements set forth in Nasdaq Rule 5550(a)(2). The notice has no immediate effect on the listing or trading of our ADSs and the ADSs will continue to trade on The Nasdaq Capital Market under the symbol “QNRX.”

Current wording

On April 29, 2024, we received a letter from the Listing Qualifications Department of Nasdaq (notifying us that the closing bid price per ADS of the Company was below the required minimum of $1.00 for a period of 31 consecutive business days and that we did not meet the minimum bid price requirements set forth in Nasdaq Rule 5550(a)(2).

Previous wording

Pursuant to Nasdaq Rule 5810(c)(3)(A), we have a period of one hundred eighty (180) calendar days, or until October 28, 2024 (the “Compliance Period”), to regain compliance with Nasdaq’s minimum bid price requirement. Compliance may be achieved without further action if the closing bid price of our ADSs is at or above $1.00 for a minimum of ten consecutive business days at any time during the Compliance Period, in which case Nasdaq will notify us if it determines we are in compliance and the matter will be closed; however Nasdaq may require the closing bid price to equal or to exceed the $1.00 minimum bid price requirement for more than 10 consecutive business days before determining that a company complies. In the event we do not regain compliance by October 28, 2024, we may be eligible for an additional 180 calendar day grace period. To qualify, we will be required to meet the continued listing requirement for market value of publicly held ADSs and all other initial listing standards for The Nasdaq Capital Market, with the exception of the minimum bid price requirement, and will need to provide written notice of its intention to cure the deficiency during the second compliance period. We intend to actively monitor the bid price of our ADS and will consider available options to regain compliance with the Nasdaq listing requirements.

Current wording

Compliance may be achieved without further action if the closing bid price of the Company’s ADS is at or above $1.00 for a minimum of ten consecutive business days at any time during the second compliance period, in which case Nasdaq will notify the Company if it determines the Company is in compliance and the matter will be closed; however Nasdaq could require the closing bid price to equal or to exceed the $1.00 minimum bid price requirement for more than 10 consecutive business days before determining that the Company complies. If compliance cannot be demonstrated by April 28, 2025, the Staff will provide written notification that the Company’s securities will be delisted. At that time, the Company may appeal the Staff’s determination to a Hearings Panel. If the Company appeals it will be asked to provide a plan to regain compliance to the Panel. Historically, Panels have generally viewed a near-term reverse split as the only definitive plan acceptable to resolve a minimum bid price deficiency.

Previous wording

General and administrative expenses were approximately $1,618,000 and $1,635,000, in the three months ended June 30, 2024 and 2023, respectively, representing a decrease of $17,000, or approximately 1.0%. The decrease is primarily due to the change in allocation of compensation expense between general and administrative expense to research and development expense of $120,000, as management devoted more time and effort to research and development activity during the period, and a decrease in insurance costs of $32,000, offset by increases in public company costs of $46,000, legal and professional fees of $21,000, travel related expenses of $34,000, and an increase in non-cash stock-based compensation expense of $15,000.

Current wording

General and administrative expenses were approximately $1,358,000 and $1,366,000, in the three months ended September 30, 2024 and 2023, respectively, representing a decrease of $9,000, or approximately 1%. The decrease is primarily due to a decreases in legal and professional fees of $59,000, travel related expenses of $91,000 and insurance costs of $31,000, offset by increases in public company costs of $100,000, compensation and benefits of $54,000, and non-cash stock-based compensation expense of $10,000.

Previous wording

Research and development expenses were approximately $519,000 and $625,000, in the three months ended June 30, 2024 and 2023, respectively, representing a decrease of $106,000, or approximately 17.0%. The decrease was primarily due to $138,000 in decreased expenditures on our development programs, including work related to the clinical studies for the development of QRX003 and our research collaborations with Queensland University of Technology. Offsetting this decrease was an increase of $34,000 of non-cash stock-based compensation. “Components of Our Results of Operations - Research and Development Expenses” above.

Current wording

Research and development expenses were approximately $1,170,000 and $759,000, in the three months ended September 30, 2024 and 2023, respectively, representing an increase of $412,000, or approximately 54%. The increase was primarily due to $380,000 in increased expenditures on our development programs, including work related to the clinical studies for the development of QRX003, and a increase of $34,000 of non-cash stock-based compensation. See “Components of Our Results of Operations - Research and Development Expenses” above.

Previous wording

We had approximately $2,000 in unrealized loss and $165,000 in interest income in the three months ended June 30, 2024 from our cash and cash equivalents and investments in marketable debt securities. We earned $188,000 in interest income and incurred approximately $34,000 in unrealized loss in the three months ended June 30, 2023 from our cash and cash equivalents and investments in marketable debt securities.

Current wording

We earned approximately $32,000 in unrealized gain and $146,000 in realized and accrued interest income, and approximately $2,000 in unrealized gain and $196,000 in realized and accrued interest income, in the three months ended September 30, 2024 and September 30, 2023 respectively, from our cash and cash equivalents and investments in marketable debt securities.

Previous wording

The following table sets forth our results of operations for the six months ended June 30, 2024, compared to the six months ended June 30, 2023:

Current wording

The following table sets forth our results of operations for the nine months ended September 30, 2024, compared to the nine months ended September 30, 2023:

Previous wording

General and administrative expenses were approximately $3,233,000 and $3,319,000, in the six months ended June 30, 2024 and 2023, respectively, representing a decrease of $86,000, or approximately 2.6%. The decrease was primarily due to a decrease of $92,000 in legal and professional fees, a reduction of insurance costs of $65,000 and a reduction of travel related expenses of $15,000, offset by increases in payroll and benefits of $43,000, and an increase in non-cash stock-based compensation expense of $44,000.

Current wording

General and administrative expenses were approximately $4,591,000 and $4,685,000, in the nine months ended September 30, 2024 and 2023, respectively, representing a decrease of $94,000, or approximately 2%. The decrease was primarily due to decreases in legal and professional fees of $211,000, travel related expenses of $105,000 and insurance costs of $95,000, offset by increases in compensation and benefits of $155,000, public company costs of $107,000 and non-cash stock-based compensation expense of $56,000.

Previous wording

Research and development expenses were approximately $1,362,000 and $1,717,000, in the six months ended June 30, 2024 and 2023, respectively, representing a decrease of $355,000, or approximately 20.7%. The decrease was primarily due to $401,000 in decreased expenditures on our development programs, including work related to the clinical studies for the development of QRX003 and our research collaborations with Queensland University of Technology. Offsetting this decrease was an increase of $49,000 of non-cash stock-based compensation expense allocated to research and development expenses. See “Components of Our Results of Operations - Research and Development Expenses” above.

Current wording

Research and development expenses were approximately $2,532,000 and $2,476,000, in the nine months ended September 30, 2024 and 2023, respectively, representing an increase of $57,000, or approximately 2%. The increase was primarily due to $83,000 of non-cash stock-based compensation expense allocated to research and development expenses. This is offset by a decrease of $22,000 in expenditures on our development programs, including work related to the clinical studies for the development of QRX003 and our research collaborations with Queensland University of Technology. See “Components of Our Results of Operations - Research and Development Expenses” above.

Previous wording

We amortize licensed or acquired intellectual property over its expected useful life, included in research and development expenses set out above. Amortization of intangible assets was approximately $50,000 and $52,000 in each of the six month periods ended June 30, 2024 and 2023.

Current wording

We amortize licensed or acquired intellectual property over its expected useful life, included in research and development expenses set out above. Amortization of intangible assets was approximately $75,000 and $78,000 in each of the nine month periods ended September 30, 2024 and 2023.

Previous wording

We had approximately $9,000 in unrealized loss and $303,000 in realized gain and interest income in the six months ended June 30, 2024 from our cash and cash equivalents and investments in marketable debt securities. We earned $339,000 in interest income and incurred approximately $14,000 in unrealized loss in the six months ended June 30, 2023 from our cash and cash equivalents and investments in marketable debt securities.

Current wording

We earned approximately $23,000 in unrealized gain and $449,000 in realized and accrued interest income in the nine months ended September 30, 2024 and we earned approximately $536,000 in realized and accrued interest income and incurred approximately $12,000 in unrealized loss in the nine months ended September 30, 2023, from our cash and cash equivalents and investments in marketable debt securities.

Previous wording

We have incurred net losses every year since inception and had an accumulated deficit of approximately $50.5 million at June 30, 2024. We have a limited operating history and have historically funded our operations through debt and equity financings. We incurred net losses of approximately $4.3 million and negative cash flows from operations of $3.4 million for the six months ended June 30, 2024. At June 30, 2024, we had cash and cash equivalent balances totaling $2.8 million and investments of $9.7 million. We have determined that we have sufficient resources to effect our business plan for at least one year from the issuance of the unaudited consolidated financial statements included in this report; however, we are subject to risks common to development stage biopharmaceutical companies including, but not limited to, unanticipated clinical trial costs and the ability to estimate such occurrences, if any, on our cash, liquidity, additional financing requirements, and availability. Accordingly, we may need to raise additional funds sooner than planned. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty. Additional financing will be required to complete the research and development of our therapeutic targets and our other operating requirements, which may not be available at acceptable terms, if at all. If we are unable to obtain additional funding when it becomes necessary, the development of our product candidates will be impacted and we would likely be forced to delay, reduce, or terminate some or all of our development programs, all of which could have a material adverse effect on our business, results of operations and financial condition.

Current wording

We have incurred net losses every year since inception and had an accumulated deficit of approximately $52.9 million at September 30, 2024. We have a limited operating history and have historically funded our operations through debt and equity financings. We incurred net losses of approximately $6.7 million and negative cash flows from operations of $5.6 million for the nine months ended September 30, 2024. At September 30, 2024, we had cash and cash equivalent balances totaling $3.1 million and investments of $7.2 million. We have determined that we have sufficient resources to effect our business plan for at least one year from the issuance of the unaudited consolidated financial statements included in this report; however, we are subject to risks common to development stage biopharmaceutical companies including, but not limited to, unanticipated clinical trial costs and the ability to estimate such occurrences, if any, on our cash, liquidity, additional financing requirements, and availability. Accordingly, we may need to raise additional funds sooner than planned. We do not expect to generate revenue from product sales unless and until we successfully complete development and obtain marketing approval for one or more of our product candidates, which we expect will take a number of years and is subject to significant uncertainty. Additional financing will be required to complete the research and development of our therapeutic targets and

Previous wording

As of June 30, 2024, we had approximately $12,600,000 in cash and cash equivalents and investments in marketable securities. The table below presents our cash flows for the six month periods ended June 30, 2024 and 2023:

Current wording

As of September 30, 2024, we had approximately $10,307,000 in cash and cash equivalents and investments in marketable securities. The table below presents our cash flows for the nine month periods ended September 30, 2024 and 2023:

Previous wording

Net cash used in operating activities was approximately $3,442,000 and $3,319,000 in the six months ended June 30, 2024 and 2023, respectively. The increase in 2024 was mostly due to a smaller increase in accounts payable and accrued expenses and an increase of prepaid expenses, offset by a decrease in net loss adjusted for non-cash income and expenses.

Current wording

Net cash used in operating activities was approximately $5,621,000 and $4,641,000 in the nine months ended September 30, 2024 and 2023, respectively. The increase in 2024 was mostly due to decreases in accounts payable and accrued expenses, partially offset by a decrease in net loss adjusted for non-cash income and expenses.

Previous wording

Net cash provided by financing activities was approximately $5,196,000 for the six months ended June 30, 2024. The net cash provided increased due to the receipt of approximately $5.5 million in net proceeds from the 2024 Offering partially offset by repayments of amounts due to officers of $300,000. Net cash provided by financing activities was approximately $5,674,000 for the six months ended June 30, 2023. The net cash provided decreased due to the receipt of $5,849,000 in net proceeds from the 2023 Offering partially offset by repayments of amounts due to officers of $175,000.

Current wording

Net cash provided by financing activities was approximately $5,046,000 for the nine months ended September 30, 2024, consisting of the receipt of approximately $5.5 million in net proceeds from the 2024 Offering partially offset by repayments of amounts due to officers of $450,000. Net cash provided by financing activities was approximately $5,399,000 for the nine months ended September 30, 2023, consisting of the receipt of $5.8 million in net proceeds from the of our public offering in February 2023 (the “2023 Offering”), partially offset by repayments of amounts due to officers of $450,000.

Previous wording

In November 2020, Quoin Inc. entered into a Master Service Agreement with Therapeutics Inc. for the management of the preclinical and clinical development of QRX003 for Netherton Syndrome. The initial term of the agreement was three years with automatic one year extensions, and the agreement required the execution of individual work orders. Quoin Inc. may terminate any work order for any reason with 90 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Therapeutics Inc. A work order was entered into in June 2022 for the first QRX003 clinical study at an expected estimated cost of approximately $4.4 million through 2024. An additional work order was entered into in December 2022 for a second QRX003 clinical study at an expected estimated cost of approximately $830,000. For the three and six months ended June 30, 2024 and 2023, we incurred research and development expenses under these agreements of approximately $162,000 and $650,000, and $360,000 and $959,000, respectively.

Current wording

In November 2020, Quoin Inc. entered into a Master Service Agreement with Therapeutics Inc. for the management of the preclinical and clinical development of QRX003 for Netherton Syndrome. The initial term of the agreement was three years with automatic one year extensions, and the agreement required the execution of individual work orders. Quoin Inc. may terminate any work order for any reason with 90 days written notice subject to costs incurred through termination and a defined termination fee, unless there is a material breach by Therapeutics Inc. A work order was entered into in June 2022 for the first QRX003 clinical study at an expected estimated cost of approximately $4.4 million through 2024. An additional work order was entered into in December 2022 for a second QRX003 clinical study at an expected estimated cost of approximately $830,000. For the three and nine months ended September 30, 2024 and 2023, we incurred research and development expenses under these agreements of approximately $275,000 and $926,000, and $155,000 and $1,113,000, respectively.

Previous wording

In November 2021, we entered into a research agreement with Queensland University of Technology (“QUT”) for a pre-clinical research program for the development of a product to treat Netherton Syndrome of approximately $250,000. In May 2022, we entered into a second research agreement with QUT for the development of a product to treat Scleroderma of approximately $610,000. Each agreement remains in place until the completion of the research program. For the three and six months ended June 30, 2024 we did not incur any costs related to these agreements. For the three and six months ended June 30, 2023, we incurred research and development costs related to these agreements of approximately $138,000 and $276,000 respectively.

Current wording

In November 2021, we entered into a research agreement with Queensland University of Technology (“QUT”) for a pre-clinical research program for the development of a product to treat Netherton Syndrome of approximately $250,000. In May 2022, we entered into a second research agreement with QUT for the development of a product to treat Scleroderma of approximately $610,000. Each agreement remains in place until the completion of the research program. For the three and nine months ended September 30, 2024 and 2023, we incurred research and development costs related to these agreements of approximately $0 and $0, and $85,000 and $361,000 respectively.

Previous wording

On June 10, 2024, we entered into a research agreement with The School of Pharmacy at UCC. The scope of the agreement encompasses the development of novel topical formulations of Rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently no approved therapies or cures. Under the terms of the agreement, based on the achievement of certain milestones, we will fund up to approximately €567,000 ($608,000) plus VAT over an anticipated 2-1/2 year period to support UCC research program to investigate the development of a number of topical rapamycin formulations for future development as potential treatments for several rare and orphan diseases. Following completion of the research program, we will have the option to advance the clinical development of rapamycin formulations developed by UCC. For the three and six months ended June 30, 2024 we did not incur any costs related to this agreement.

Current wording

On June 10, 2024, we entered into a research agreement with The School of Pharmacy at UCC. The scope of the agreement encompasses the development of novel topical formulations of Rapamycin (sirolimus) as potential treatments for a number of rare and orphan diseases for which there are currently no approved therapies or cures. Under the terms of the agreement, based on the achievement of certain milestones, we will fund up to approximately €567,000 ($608,000) plus VAT over an anticipated 2-1/2 year period to support UCC research program to investigate the development of a number of topical rapamycin formulations for future development as potential treatments for several rare and orphan diseases. Following completion of the research program, we will have the option to advance the clinical development of rapamycin formulations developed by UCC. For the three and nine months ended September 30, 2024 we did not incur any costs related to this agreement.