Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2023

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

For the transition period from _____________ to _____________

Qualigen Therapeutics, Inc.

(Exact name of registrant as specified in its charter)

Delaware

001-37428

26-3474527

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(I.R.S. Employer

Identification No.)

2042 Corte Del Nogal, Carlsbad, California 92011

(Address of principal executive offices) (Zip Code)

(760) 918-9165

(Registrant’s telephone number, including area code)

n/a

(Former name or former address, if changed since last report)

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

Title of each class		Trading Symbol		Name of each exchange on which registered
Common Stock, par value $.001 per share		QLGN		The Nasdaq Capital Market of The Nasdaq Stock Market LLC

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

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

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

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

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

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

As of August 10, 2023, there were 5,052,463 shares of the registrant’s common stock, par value $0.001 per share, outstanding.

TABLE OF CONTENTS

		Page
PART I.	Financial Information	3

Item 1.	Condensed Consolidated Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets as of June 30, 2023 and December 31, 2022	3
	Condensed Consolidated Statements of Operations and Other Comprehensive Loss for the Three and Six Months Ended June 30, 2023 and 2022	4
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the Three and Six Months Ended June 30, 2023 and 2022	5
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2023 and 2022	6
	Notes to Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	32
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	43
Item 4.	Controls and Procedures	43

PART II.	Other Information	45

Item 1.	Legal Proceedings	45
Item 1A.	Risk Factors	45
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	46
Item 3.	Defaults Upon Senior Securities	46
Item 4.	Mine Safety Disclosures	46
Item 5.	Other Information	46
Item 6.	Exhibits	47

ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

QUALIGEN THERAPEUTICS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	June 30, 2023			December 31, 2022
ASSETS
Current assets
Cash	$	1,341,659		$	7,034,434
Accounts receivable, net		679,380			538,587
Inventory, net		1,563,399			1,586,297
Prepaid expenses and other current assets		1,278,077			1,661,220
Total current assets		4,862,515			10,820,538
Restricted cash		5,434			5,690
Right-of-use assets		1,305,970			1,422,538
Property and equipment, net		498,647			345,087
Intangible assets, net		5,833,070			5,845,702
Goodwill		625,602			625,602
Other assets		18,334			18,334
Total Assets	$	13,149,572		$	19,083,491

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities
Accounts payable	$	1,756,183		$	857,311
Accrued vacation		332,617			467,948
Accrued expenses and other current liabilities		1,980,555			1,511,856
R&D grant liability		151,620			780,682
Deferred revenue, current portion		94,474			116,161
Operating lease liability, current portion		257,155			240,645
Short term debt-related party		965,155			950,722
Warrant liabilities		133,500			788,100
Warrant liabilities - related party		2,010,180			2,834,547
Convertible debt - related party		812,419			60,197
Total current liabilities		8,493,858			8,608,169
Operating lease liability, net of current portion		1,168,653			1,301,919
Deferred revenue, net of current portion		28,648			49,056
Deferred tax liability		150,369			357,757
Total liabilities		9,841,528			10,316,901
Commitments and Contingencies (Note 12)		-			-
Stockholders’ equity
Qualigen Therapeutics, Inc. stockholders’ equity:
Common stock, $0.001 par value; 225,000,000 shares authorized; 5,052,463 and 4,210,737 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively		42,952			42,110
Additional paid-in capital		112,554,830			110,528,050
Accumulated other comprehensive income		131,891			50,721
Accumulated deficit		(110,695,598	)		(103,385,172	)
Total Qualigen Therapeutics, Inc. stockholders’ equity		2,034,075			7,235,709
Noncontrolling interest		1,273,969			1,530,881
Total Stockholders’ Equity		3,308,044			8,766,590
Total Liabilities & Stockholders’ Equity	$	13,149,572		$	19,083,491

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

QUALIGEN THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND OTHER COMPREHENSIVE LOSS

(Unaudited)


	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2023			2022			2023			2022
REVENUES
Net product sales	$	1,627,031		$	1,430,534		$	3,234,201		$	2,152,563
Total revenues		1,627,031			1,430,534			3,234,201			2,152,563

EXPENSES
Cost of product sales		1,016,542			1,099,677			2,281,368			1,928,524
General and administrative		2,665,849			2,660,857			4,380,283			5,559,608
Research and development		1,326,544			1,506,227			3,448,095			3,370,972
Sales and marketing		169,223			305,103			368,337			443,426
Total expenses		5,178,158			5,571,864			10,478,083			11,302,530

LOSS FROM OPERATIONS		(3,551,127	)		(4,141,330	)		(7,243,882	)		(9,149,967	)

OTHER EXPENSE (INCOME), NET
Gain on change in fair value of warrant liabilities		(440,294	)		(14,800	)		(1,478,967	)		(698,042	)
Interest expense (income), net		377,416			(4,824	)		921,652			(11,132	)
Loss on voluntary conversion of convertible debt		—			—			1,077,287			—
Loss on disposal of equipment held for lease		63,302			—			63,302			—
Other income, net		(5,680	)		376			(10,559	)		341
Loss on fixed asset disposal		—			—			300			—
Total other expense (income), net		(5,256	)		(19,248	)		573,015			(708,833	)

LOSS BEFORE (BENEFIT) PROVISION FOR INCOME TAXES		(3,545,871	)		(4,122,082	)		(7,816,897	)		(8,441,134	)

(BENEFIT) PROVISION FOR INCOME TAXES		(38,182	)		5,438			(201,959	)		6,173

NET LOSS		(3,507,689	)		(4,127,520	)		(7,614,938	)		(8,447,307	)

Net loss attributable to noncontrolling interest		(43,484	)		(4,116	)		(304,512	)		(4,116	)

Net loss attributable to Qualigen Therapeutics, Inc.	$	(3,464,205	)	$	(4,123,404	)	$	(7,310,426	)	$	(8,443,191	)

Net loss per common share, basic and diluted	$	(0.69	)	$	(1.12	)	$	(1.46	)	$	(2.35	)
Net loss per common share, basic	$	(0.69	)	$	(1.12	)	$	(1.46	)	$	(2.35	)
Weighted—average number of shares outstanding, basic and diluted		5,052,463			3,668,016			5,006,050			3,599,093
Weighted—average number of shares outstanding, basic		5,052,463			3,668,016			5,006,050			3,599,093

Other comprehensive loss, net of tax
Net loss	$	(3,507,689	)	$	(4,127,520	)	$	(7,614,938	)	$	(8,447,307	)
Foreign currency translation adjustment		(56,747	)		65,540			119,473			65,540
Other comprehensive loss		(3,564,436	)		(4,061,980	)		(7,495,465	)		(8,381,767	)
Comprehensive loss attributable to noncontrolling interest		(43,484	)		(4,116	)		(304,512	)		(4,116	)
Comprehensive loss attributable to Qualigen Therapeutics, Inc.	$	(3,520,952	)	$	(4,057,864	)	$	(7,190,953	)	$	(8,377,651	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

QUALIGEN THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)


													Total
													Qualigen
					Additional		Accumulated Other						Therapeutics, Inc.						Total
	Common Stock				Paid-In		Comprehensive			Accumulated			Stockholders’			Noncontrolling			Stockholders’
	Shares		Amount		Capital		Income			Deficit			Equity			Interest			Equity
Balance at December 31, 2022		4,210,737	$	42,110	$	110,528,050	$	50,721		$	(103,385,172	)	$	7,235,709		$	1,530,881		$	8,766,590
Voluntary conversion of convertible debt into common stock		841,726		842		1,111,740		—			—			1,112,582			—			1,112,582
Stock-based compensation		—		—		247,657		—			—			247,657			4,569			252,226
Foreign currency translation adjustment		—		—		—		119,723			—			119,723			56,497			176,220
Net loss		—		—		—		—			(3,846,221	)		(3,846,221	)		(261,028	)		(4,107,249	)
Balance at March 31, 2023		5,052,463	$	42,952	$	111,887,447	$	170,444		$	(107,231,393	)	$	4,869,450		$	1,330,919		$	6,200,369
Stock-based compensation		—		—		667,383		—			—			667,383			4,728			672,111
Foreign currency translation adjustment		—		—		—		(38,553	)		—			(38,553	)		(18,194	)		(56,747	)
Net loss		—		—		—		—			(3,464,205	)		(3,464,205	)		(43,484	)		(3,507,689	)
Balance at June 30, 2023		5,052,463	$	42,952	$	112,554,830	$	131,891		$	(110,695,598	)	$	2,034,075		$	1,273,969		$	3,308,044

					Additional		Other					Therapeutics, Inc.						Total
	Common Stock				Paid-In		Comprehensive		Accumulated			Stockholders’			Noncontrolling			Stockholders’
	Shares		Amount $		Capital		Income		Deficit			Equity			Interest			Equity
Balance at December 31, 2021		3,529,018	$	35,290	$	101,274,073	$	—	$	(84,744,629	)	$	16,564,734		$	—		$	16,564,734
Stock issued upon exercise of warrants		536		5		4,711		—		—			4,716			—			4,716
Stock-based compensation		—		—		1,267,166		—		—			1,267,166			—			1,267,166
Net Loss		—		—		—		—		(4,319,787	)		(4,319,787	)		—			(4,319,787	)
Balance at March 31, 2022		3,529,554	$	35,295	$	102,545,950	$	—	$	(89,064,416	)	$	13,516,829		$	—		$	13,516,829
Common stock issued for business acquisition		350,000		3,500		1,841,000		—		—			1,844,500			—			1,844,500
Prefunded warrants issued for business acquisition		—		—		1,746,816		—		—			1,746,816			—			1,746,816
Foreign currency translation adjustment		—		—		—		65,540		—			65,540			—			65,540
Estimated fair value of noncontrolling interest related to business acquisition		—		—		—		—		—			—			4,000,000			4,000,000
Fair value of warrant modification for business acquisition		—		—		696		—		—			696			—			696
Stock-based compensation		—		—		1,423,282		—		—			1,423,282			—			1,423,282
Net loss		—		—		—		—		(4,123,404	)		(4,123,404	)		(4,116	)		(4,127,520	)
Balance at June 30, 2022		3,879,554	$	38,795	$	107,557,744	$	65,540	$	(93,187,820	)	$	14,474,259		$	3,995,884		$	18,470,143

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

QUALIGEN THERAPEUTICS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	For the Six Months Ended June 30,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(7,614,938	)	$	(8,447,307	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		122,523			66,258
Amortization of right-of-use assets		116,567			109,803
Accounts receivable reserves and allowances		(133,278	)		(75,295	)
Inventory reserves		(22,992	)		(16,405	)
Stock-based compensation		906,145			2,690,447
Change in fair value of warrant liabilities		(1,478,967	)		(698,042	)
Loss on voluntary conversion of convertible debt		1,077,287			—
Accretion of discount on convertible debt		787,517			—
Loss on disposal of fixed assets and equipment held for lease		63,602			—

Changes in operating assets and liabilities:
Accounts receivable		(8,614	)		250,201
Inventory and equipment held for lease		(37,390	)		(237,930	)
Prepaid expenses and other assets		382,893			(548,487	)
Accounts payable		899,753			27,941
Accrued expenses and other current liabilities		357,508			(828,229	)
R&D grant liability		(613,793	)		—
Operating lease liability		(116,756	)		(73,408	)
Deferred revenue		(42,095	)		(47,345	)
Deferred tax liability		(207,388	)		—
Net cash used in operating activities		(5,562,416	)		(7,827,798	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(246,418	)		(63,483	)
Net cash acquired in business combination		—			135,354
Net cash (used in)/provided by investing activities		(246,418	)		71,871

CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from warrant exercises		—			3,859
Net cash provided by financing activities		—			3,859

Net change in cash and restricted cash		(5,808,834	)		(7,752,068	)
Effect of exchange rate changes on cash and restricted cash		115,803			(34,228	)
Cash and restricted cash - beginning of period		7,040,124			17,538,272
Cash and restricted cash - end of period	$	1,347,093		$	9,751,976

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest	$	—		$	—
Taxes	$	6,293		$	3,501

NONCASH FINANCING AND INVESTING ACTIVITIES:
Net transfers to equipment held for lease from inventory	$	83,271		$	—
Fair value of warrant liabilities on date of exercise	$	—		$	858
Voluntary conversion of convertible debt into common stock	$	1,112,582		$	—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

QUALIGEN THERAPEUTICS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

Organization

Qualigen, Inc., a subsidiary of Qualigen Therapeutics, Inc., was incorporated in Minnesota in 1996 to design, develop, manufacture and sell point-of-care quantitative immunoassay diagnostic products for use in physician offices and other point-of-care settings worldwide, and was reincorporated in Delaware in 1999. Qualigen Therapeutics, Inc. (the “Company”) operates in one business segment. In May 2020, Qualigen, Inc. completed a reverse recapitalization transaction with Ritter Pharmaceuticals, Inc. (“Ritter”) and Ritter was renamed Qualigen Therapeutics, Inc. All shares of Qualigen, Inc.’s capital stock were exchanged for Qualigen Therapeutics, Inc.’s capital stock in the merger. Ritter/Qualigen Therapeutics common stock, which was previously traded on the Nasdaq Capital Market under the ticker symbol “RTTR,” commenced trading on the Nasdaq Capital Market, on a post-reverse-stock-split adjusted basis, under the trading symbol “QLGN” on May 26, 2020.

On May 26, 2022, the Company acquired 2,232,861 shares of Series A-1 Preferred Stock of NanoSynex, Ltd. (“NanoSynex”) from Alpha Capital Anstalt (“Alpha Capital”), a related party, in exchange for 350,000 reverse split adjusted shares of the Company’s common stock and a prefunded warrant to purchase 331,464 reverse split adjusted shares of the Company’s common stock at an exercise price of $0.001 per share. These warrants were subsequently exercised on September 13, 2022. Concurrently with this transaction, the Company also purchased 381,786 shares of Series B preferred stock from NanoSynex for a total purchase price of $600,000. The transactions resulted in the Company acquiring a 52.8% interest in NanoSynex (the “NanoSynex Acquisition”). NanoSynex is a micro-biologics diagnostics company domiciled in Israel. On July 20, 2023, the Company entered into an Amendment and Settlement Agreement with NanoSynex Ltd. (the “NanoSynex Amendment”), which amended the Master Funding Agreement for the Operational and Technology Funding of NanoSynex Ltd., dated May 26, 2022, by and between the Company and NanoSynex (the “NanoSynex Funding Agreement”), a majority owned subsidiary of the Company, to, among other things, provide for the further funding of NanoSynex, as contemplated by the NanoSynex Funding Agreement (see Note 16 - Subsequent Events: Amendment and Settlement Agreement with NanoSynex Ltd. ).

Basis of Presentation

The accompanying condensed consolidated financial statements of the Company have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), Regulation S-X and rules and regulations of the Securities and Exchange Commission (“SEC”).

Principles of Consolidation

The accompanying condensed consolidated financial statements include the accounts of the Company and its majority owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Any reference in these notes to applicable guidance is meant to refer to U.S. GAAP. The Company views its operations and manages its business in one operating segment. In general, the functional currency of the Company and its subsidiaries is the U.S. dollar, however for NanoSynex, the functional currency is the local currency, New Israeli Shekels (NIS). As such, assets and liabilities for NanoSynex are translated into U.S. dollars and the effects of foreign currency translation adjustments are reflected as a component of accumulated other comprehensive income within the Company’s consolidated statements of changes in stockholders’ equity.

Accounting Estimates

Management uses estimates and assumptions in preparing its condensed consolidated financial statements in accordance with U.S. GAAP. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. The most significant estimates relate to the estimated fair value of in-process research and development, goodwill, warrant liabilities, stock-based compensation, amortization and depreciation, inventory reserves, allowances for doubtful accounts and returns, and warranty costs. Actual results could vary from the estimates that were used.

Reverse Stock Split

On November 23, 2022, the Company effected a 1-for-10, as determined by the Company’s board of directors, reverse stock split of its outstanding shares of common stock (the “Reverse Stock Split”). The Reverse Stock Split reduced the Company’s shares of outstanding common stock, stock options, and warrants to purchase shares of our common stock. Fractional shares of common stock that would have otherwise resulted from the Reverse Stock Split were rounded down to the nearest whole share and cash in lieu of fractional shares was paid to stockholders. All share and per share data for all periods presented in the accompanying financial statements and the related disclosures have been adjusted retrospectively to reflect the Reverse Stock Split. The number of authorized shares of common stock and the par value per share remains unchanged.

Cash

The Company considers all highly liquid investments purchased with an initial maturity of 90 days or less and money market funds to be cash equivalents. Restricted cash includes cash that is restricted due to Israeli banking regulations.

The Company maintains the majority of its cash in government money market mutual funds and in accounts at banking institutions in the U.S. that are of high quality. Cash held in these accounts often exceed the FDIC insurance limits. If such banking institutions were to fail, the Company could lose all or a portion of amounts held in excess of such insurance limitations. In March 2023, Silicon Valley Bank and Signature Bank, and more recently in May 2023, First Republic Bank, were closed due to liquidity concerns and taken over by the Federal Deposit Insurance Corporation (FDIC). While the Company did not have an account at any of these banks, in the event of failure of any of the financial institutions where the Company maintains its cash and cash equivalents, there can be no assurance that the Company would be able to access uninsured funds in a timely manner or at all. Any inability to access or delay in accessing these funds could adversely affect our business and financial position.

Inventory, Net

Inventory is recorded at the lower of cost or net realizable value. Cost is determined using the first-in, first-out method. The Company reviews the components of its inventory on a periodic basis for excess or obsolete inventory, and records reserves for inventory components identified as excess or obsolete.

Impairment of Long-Lived Assets

The Company assesses potential impairments to its long-lived assets when there is evidence that events or changes in circumstances indicate that assets may not be recoverable. An impairment loss would be recognized when the sum of the expected future undiscounted cash flows is less than the carrying amount of the assets. The amount of impairment loss, if any, will generally be measured as the difference between the net book value of the assets and their estimated fair values. During the three and six months ended June 30, 2023 and 2022, no such impairment losses have been recorded.

Segment Reporting

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker in making decisions regarding resource allocation and assessing performance. To date, the Company has viewed its operations and managed its business as one segment operating primarily within the United States and Israel.

Accounts Receivable, Net

The Company grants credit to domestic physicians, clinics, and distributors. The Company performs ongoing credit evaluations of its customers and generally requires no collateral. Customers can purchase certain products through a financing agreement that the Company has with an outside leasing company. Under the agreement, the leasing company evaluates the credit worthiness of the customer. Upon acceptance of the product by the customer, the leasing company remits payment to the Company at a discount. This financing arrangement is without recourse to the Company.

The Company records an allowance for doubtful accounts and returns equal to the estimated uncollectible amounts or expected returns. The Company’s estimates are based on historical collections and returns and a review of the current status of trade accounts receivable.

Accounts receivable, net is comprised of the following at:

SCHEDULE OF ACCOUNTS RECEIVABLE

	June 30, 2023			December 31, 2022
Accounts Receivable	$	733,964		$	726,449
Less Reserves and Allowances		(54,584	)		(187,862	)
Accounts receivable, net	$	679,380		$	538,587

Research and Development

Except for acquired in process research and development (IPR&D), the Company expenses research and development costs as incurred including therapeutics license costs.

R&D Grants

NanoSynex has received R&D grants from Israel Innovation Authority (IIA) and from the European Commission. These grants may provide cash funding to NanoSynex from time to time in advance of the applicable costs being incurred. When such cash funding is received from these grants in advance, the proceeds are recorded as a current or non-current R&D grant liability based on the time from the condensed consolidated balance sheets date to the expected future date of recognition as a reduction to research and development expenses.

Patent Costs

The Company expenses all costs as incurred in connection with patent applications (including direct application fees, and the legal and consulting expenses related to making such applications) and such costs are included in general and administrative expenses in the condensed consolidated statement of operations.

Shipping and Handling Costs

The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with inbound and outbound freight are generally recorded in cost of sales which totaled approximately $78,000 and $72,000, respectively, for the three months ended June 30, 2023 and 2022, and approximately $144,000 and $111,000, respectively, for the six months ended June 30, 2023 and 2022. Other shipping and handling costs included in general and administrative, research and development, and sales and marketing expenses were $0 and $4,000 for the three months ended June 30, 2023 and 2022, respectively, and approximately $4,000 and $8,000 for the six months ended June 30, 2023 and 2022, respectively.

Revenue from Contracts with Customers

The Company applies the following five-step model in accordance with ASC 606, Revenue from Contracts with Customers, in order to determine revenue: (i) identification of the promised goods or services in the contract; (ii) determination of whether the promised goods or services are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

Product Sales

The Company generates revenue from selling FastPack System analyzers, accessories and disposable products used with the FastPack System. Disposable products include reagent packs, which are diagnostic tests for prostate-specific antigen, testosterone, thyroid disorders, pregnancy, and Vitamin D.

The Company provides disposable products and equipment in exchange for consideration, which occurs when a customer submits a purchase order and the Company provides disposable products and equipment at the agreed upon prices in the invoice. Generally, customers purchase disposable products using separate purchase orders after the equipment (“analyzer”) has been provided to the customer. The initial delivery of the equipment and reagent packs represents a single performance obligation and is completed upon receipt by the customer. The delivery of each subsequent individual reagent pack represents a separate performance obligation because the reagent packs are standardized, are not interrelated in any way, and the customer can benefit from each reagent pack without any other product. There are no significant discounts, rebates, returns or other forms of variable consideration. Customers are generally required to pay within 30 days.

The performance obligation arising from the delivery of the equipment is satisfied upon the delivery of the equipment to the customer. The disposable products are shipped Free on Board (“FOB”) shipping point. For disposable products that are shipped FOB shipping point, the customer has the significant risks and rewards of ownership and legal title to the assets when the disposable products leave the Company’s shipping facilities, thus the customer obtains control and revenue is recognized at that point in time.

The Company has elected the practical expedient and accounting policy election to account for the shipping and handling as activities to fulfill the promise to transfer the disposable products and not as a separate performance obligation.

The Company’s contracts with customers generally have an expected duration of one year or less, and therefore the Company has elected the practical expedient in ASC 606 to not disclose information about its remaining performance obligations. Any incremental costs to obtain contracts are recorded as selling, general and administrative expense as incurred due to the short duration of the Company’s contracts.

Contract Asset and Liability Balances

The timing of the Company’s revenue recognition may differ from the timing of payment by the Company’s customers. The Company records a receivable when revenue is recognized prior to payment and there is an unconditional right to payment. Alternatively, when payment precedes the performance of the related services, the Company records deferred revenue until the performance obligations are satisfied.

Multiple performance obligations include contracts that combine both the Company’s analyzer and a customer’s future reagent purchases under a single contract. In some sales contracts, the Company provides analyzers at no charge to customers. Title to the analyzer is maintained by the Company and the analyzer is returned by the customer to the Company at the end of the purchase agreement.

During the three months ended June 30, 2023 and 2022, product sales are stated net of an allowance for estimated returns of approximately $28,000 and $10,000, respectively. During the six months ended June 30, 2023 and 2022, product sales are stated net of an allowance for estimated returns of approximately $33,000 and $53,000, respectively.

Deferred Revenue

Payments received in advance from customers pursuant to certain collaborative research license agreements, deposits against future product sales, multiple element arrangements and extended warranties are recorded as a current or non-current deferred revenue liability based on the time from the condensed consolidated balance sheets date to the future date of revenue recognition.

Operating Leases

Effective April 1, 2020, the Company adopted Accounting Standards Update (“ASU”) No. 2018-11, Leases (Topic 842) Targeted Improvements (“Topic 842”). In accordance with the guidance in Topic 842, the Company recognizes lease liabilities and corresponding right-of-use-assets for all leases with terms of greater than 12 months. Leases with a term of 12 months or less will be accounted for in a manner similar to the guidance for operating leases prior to the adoption of Topic 842. (See Note 12 - Commitments and Contingencies for more information).

Property and Equipment, Net

Property and equipment are stated at cost and are presented net of accumulated depreciation. Depreciation is provided for on a straight-line basis over the estimated useful lives of the related assets as follows:

Machinery and equipment			5 years
Computer equipment			3 years
Molds and tooling			5 years
Furniture and fixtures			5 years

Leasehold improvements are amortized on a straight-line basis over the shorter of the lease term or their estimated useful lives. The Company occasionally designs and builds its own machinery. The costs of these projects, which includes the cost of construction and other direct costs attributable to the construction, are capitalized as construction in progress. No provision for depreciation is made on construction in progress until the relevant assets are completed and placed in service.

The Company’s policy is to evaluate the remaining lives and recoverability of long-term assets on at least an annual basis or when conditions are present that indicate impairment.

Business Combinations

The Company accounts for business combinations using the acquisition method pursuant to FASB ASC Topic 805. This method requires, among other things, that results of operations of acquired companies are included in Qualigen’s financial results beginning on the respective acquisition date, and that assets acquired and liabilities assumed are recognized at fair value as of the acquisition date. Intangible assets acquired in a business combination are recorded at fair value using a discounted cash flow model. The discounted cash flow model requires assumptions about the timing and amount of future net cash flows, the cost of capital and terminal values from the perspective of a market participant. Each of these factors can significantly affect the value of the intangible asset. Any excess of the fair value of consideration transferred (the “purchase price”) over the fair values of the net assets acquired is recognized as goodwill. The fair value of assets acquired and liabilities assumed in certain cases may be subject to revision based on the final determination of fair value during a period of time not to exceed 12 months from the acquisition date. Legal costs, due diligence costs, business valuation costs and all other acquisition-related costs are expensed when incurred.

Goodwill

Goodwill represents the difference between the purchase price and the fair value of the identifiable tangible and intangible net assets acquired, when accounted for using the purchase method of accounting. Goodwill has an indefinite useful life and is not amortized but is reviewed for impairment annually and whenever events or changes in circumstances indicate that the carrying value of the goodwill may not be recoverable. In testing for impairment, the fair value of the reporting unit is compared to the carrying value. If the net assets assigned to the reporting unit exceed the fair value of the reporting unit, an impairment loss equal to the difference is recorded. As a result of the annual goodwill impairment analysis, the Company recognized a $4,239,000 non-cash goodwill and fixed asset impairment charge in the valuation of its business acquisition of NanoSynex for the fiscal year ended December 31, 2022. There were no impairment losses during the three and six months ended June 30, 2023 and 2022.

Intangible Assets

In Process R&D

Acquired in process R&D (IPR&D) represents the fair value assigned to the research and development assets that have not reached technological feasibility. The value assigned to IPR&D is determined by estimating the costs to develop the acquired technology into commercially viable products, estimating the resulting revenue from the projects, and discounting the net cash flow to present value. The revenue and cost projections used to value acquired IPR&D are, as applicable, reduced based on the probability of success of developing the new product. Additionally, projections consider relevant market sizes and growth factors, expected trends in technology and the nature and expected timing of new product introductions. The rates utilized to discount the net cash flow to its present value are commensurate with the stage of development of the project and uncertainties in the economic estimates used in the projections. Upon the acquisition of acquired IPR&D, an assessment is completed as to whether the acquisition constitutes an acquisition of a single asset or a group of assets. Multiple factors are considered in this assessment, including the nature of the technology acquired, the presence or absence of separate cash flows, the development process and stage of completion, quantitative significance, and the Company’s rationale for entering into the transaction.

If a business is acquired, as defined under the applicable accounting standards, then the acquired IPR&D is capitalized as an intangible asset. If an asset or group of assets is acquired that do not meet the definition under the applicable accounting standards, then the acquired IPR&D is expensed on its acquisition date. Future costs to develop these assets are recorded to research and development expense in the Company’s condensed consolidated statements of operations and other comprehensive income (loss) as they are incurred.

IPR&D is evaluated for impairment annually using the same methodology as described above for calculating fair value. If the carrying value of the acquired IPR&D exceeds the fair value, then the intangible asset is written down to its fair value, with the resulting adjustment recorded as a charge to operations. Changes in estimates and assumptions used in determining the fair value of acquired IPR&D could result in an impairment.

Other Intangible Assets, Net

Other intangible assets consist of patent-related costs and costs for license agreements. Management reviews the carrying value of other intangible assets that are being amortized on an annual basis or sooner when there is evidence that events or changes in circumstances may indicate that impairment exists. The Company considers relevant cash flow and profitability information, including estimated future operating results, trends and other available information, in assessing whether the carrying value of intangible assets being amortized can be recovered.

If the Company determines that the carrying value of other intangible assets will not be recovered from the undiscounted future cash flows expected to result from the use and eventual disposition of the underlying assets, the Company considers the carrying value of such intangible assets as impaired and reduces them by a charge to operations in the amount of the impairment.

Costs related to acquiring patents and licenses are capitalized and amortized over their estimated useful lives, which is generally 5 to 17 years, using the straight-line method. Amortization of patents and licenses commences once final approval of the patent or license has been obtained. Patent and license costs are charged to operations if it is determined that the patent or license will not be obtained.

Derivative Financial Instruments and Warrant Liabilities

The Company does not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. For derivative financial instruments that are accounted for as liabilities, the derivative instrument is initially recorded at its fair value and is then re-valued at each reporting date, with changes in the fair value reported in the condensed consolidated statements of operations and other comprehensive income (loss). Depending on the features of the derivative financial instrument, the Company uses either the Black-Scholes option-pricing model or a Monte-Carlo simulation to value the derivative instruments at inception and subsequent valuation dates. The classification of derivative instruments, including whether such instruments should be recorded as liabilities or as equity, is re-assessed at the end of each reporting period (See Note 9- Warrant Liabilities).

Fair Value Measurements

The Company determines the fair value measurements of applicable assets and liabilities based on a three-tier fair value hierarchy established by accounting guidance and prioritizes the inputs used in measuring fair value. The Company discloses and recognizes the fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant to the valuation (Level 3 measurements). The guidance establishes three levels of the fair value hierarchy as follows:

	●	Level 1 - Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;
	●	Level 2 - Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly, including inputs in markets that are not considered to be active; and
	●	Level 3 - Inputs that are unobservable.

Fair Value of Financial Instruments

Cash, accounts receivable, prepaids, accounts payable, and accrued liabilities are carried at cost, which management believes approximates fair value due to the short-term nature of these instruments.

Comprehensive Loss

Comprehensive loss consists of net income and foreign currency translation adjustments. Comprehensive gains (losses) have been reflected in the statements of operations and comprehensive loss and as a separate component in the statements of stockholders’ equity for all periods presented.

Stock-Based Compensation

Stock-based compensation cost for equity awards granted to employees and non-employees is measured at the grant date based on the calculated fair value of the award using the Black-Scholes option-pricing model, and is recognized as an expense, under the straight-line method, over the requisite service period (generally the vesting period of the equity grant). If the Company determines that other methods are more reasonable, or other methods for calculating these assumptions are prescribed by regulators, the fair value calculated for the Company’s stock options could change significantly. Higher volatility, lower risk-free interest rates, and longer expected lives would result in an increase to stock-based compensation expense to employees and non-employees determined at the date of grant.

Income Taxes

Deferred income taxes are recognized for temporary differences in the basis of assets and liabilities for financial statement and income tax reporting that arise due to net operating loss carry forwards, research and development credit carry forwards and from using different methods and periods to calculate depreciation and amortization, allowance for doubtful accounts, accrued vacation, research and development expenses, and state taxes. A provision has been made for income taxes due on taxable income and for the deferred taxes on the temporary differences.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Realization of the deferred income tax asset is dependent on generating sufficient taxable income in future years.

Sales and Excise Taxes

Sales and other taxes collected from customers and subsequently remitted to government authorities are recorded as accounts receivable with corresponding tax payable. These balances are removed from the condensed consolidated balance sheet as cash is collected from customers and remitted to the tax authority.

Warranty Costs

The Company’s warranty policy generally provides for one year of coverage against defects and nonperformance within published specifications for sold analyzers and for the term of the contract for equipment held for lease. The Company accrues for estimated warranty costs in the period in which the revenue is recognized based on historical data and the Company’s best estimates of analyzer failure rates and costs to repair.

Accrued warranty liabilities were approximately $140,000 and $138,000, respectively, as of June 30, 2023 and December 31, 2022 and are included in accrued expenses and other current liabilities on the accompanying condensed consolidated balance sheets. Warranty costs were approximately $63,000 and $22,000 for the three months ended June 30, 2023 and 2022, respectively, and approximately $104,000 and $41,000 for the six months ended June 30, 2023 and 2022, respectively, and are included in cost of product sales in the condensed consolidated statements of operations and other comprehensive loss.

Foreign Currency Translation

The functional currency for the Company is the U.S. dollar. The functional currency for NanoSynex, the Company’s newly acquired majority owned subsidiary, is the New Israeli Shekel (NIS). The financial statements of NanoSynex are translated into U.S. dollars using exchange rates in effect at each period end for assets and liabilities; using exchange rates in effect during the period for results of operations; and using historical exchange rates for certain equity accounts. The adjustment resulting from translating the financial statements of NanoSynex is reflected as a separate component of other comprehensive income (loss).

Other comprehensive loss related to the effects of foreign currency translation adjustments attributable to NanoSynex was ($56,747) and $65,540 for the three months ending June 30, 2023 and 2022, respectively, and $119,473 and $65,540 for the six months ending June 30, 2023 and 2022, respectively.

War in Ukraine

In February 2022, Russia invaded Ukraine. While the Company has no direct exposure in Russia and Ukraine, the Company continues to monitor any broader impact to the global economy, including with respect to inflation, supply chains and fuel prices. The full impact of the conflict on the Company’s business and financial results remains uncertain and will depend on the severity and duration of the conflict and its impact on regional and global economic conditions.

Inflation and Global Economic Conditions

During the year ended 2022 and continuing into the current fiscal year, global commodity and labor markets experienced significant inflationary pressures attributable to ongoing economic recovery and supply chain issues. The Company is subject to inflationary pressures with respect to raw materials, labor and transportation. Accordingly, the Company continues to take actions with its customers and suppliers to mitigate the impact of these inflationary pressures in the future. Actions to mitigate inflationary pressures with suppliers include aggregation of purchase requirements to achieve optimal volume benefits, negotiation of cost-reductions and identification of more cost competitive suppliers. While these actions are designed to offset the impact of inflationary pressures, the Company cannot provide assurance that it will be successful in fully offsetting increased costs resulting from inflationary pressure. In addition, the global economy suffers from slowing growth and rising interest rates, and some economists believe that there may be a global recession in the near future. If the global economy slows, our business would be adversely affected.

Impact of COVID-19 Pandemic

The COVID-19 pandemic has had a dramatic impact on businesses globally and on the Company’s business as well. During the height of the pandemic sales of diagnostic products decreased significantly and the Company’s net loss increased significantly, as deferral of patients’ non-emergency visits to physician offices, clinics and small hospitals sharply reduced demand for FastPack tests. For 2023 we continue to experience recovery in demand.

Other accounting standard updates are either not applicable to the Company or are not expected to have a material impact on the Company’s condensed consolidated financial statements.

NOTE 2 — LIQUIDITY

As of June 30, 2023, we had approximately $1.3 million in cash and an accumulated deficit of $110.7 million. For the six months ended June 30, 2023 and year ended December 31, 2022, we used cash of $5.6 million and $13.2 million, respectively, in operations.

On July 20, 2023, the Company entered into a stock purchase agreement (the “Purchase Agreement”) with Chembio Diagnostics, Inc. (“Chembio”), Biosynex, S.A. and Qualigen, Inc., a wholly-owned subsidiary of the Company (see Note 16 - Subsequent Events). Pursuant to the Purchase Agreement, the Company agreed to sell to the Buyer all of the issued and outstanding shares of common stock (collectively, the “Shares”) of Qualigen, Inc., which was the legal entity operating the Company’s FastPack™ diagnostics business (the “Transaction”). The Transaction closed on July 20, 2023. Following the consummation of the Transaction, our Qualigen, Inc. subsidiary became a wholly-owned subsidiary of Chembio.

The aggregate net purchase price paid to the Company for the Shares was $5.2 million in cash, based on a base purchase price of $5.8 million, subject to certain post-closing adjustments, upward or downward, as applicable, for: (i) cash held by Qualigen, Inc. as of the closing of the Transaction; (ii) net working capital of Qualigen, Inc. as of the closing of the Transaction, (iii) certain indebtedness of Qualigen, Inc. as of the closing of the Transaction, and (iv) certain Transaction expenses as of the closing of the Transaction. Of the $5.2 million in cash, $450,000 is being held in escrow to satisfy certain Company indemnification obligations (the “Indemnity Escrow”). Any amounts remaining in the Indemnity Escrow that have not been offset or reserved for claims will be released to the Company within five business days following the date that is 18 months after the closing.

The Company’s cash balances as of the date that these financial statements were issued along with the proceeds from the above sale to Chembio, without additional financing, are expected to fund operations into the first quarter of 2024. The Company expects to continue to have net losses and negative cash flow from operations, which over time will challenge its liquidity. These factors raise substantial doubt about the Company’s ability to continue as a going concern for the one-year period following the date that these financial statements were issued.

There is no assurance that profitable operations will ever be achieved, or, if achieved, could be sustained on a continuing basis. In order to fully execute its business plan, the Company will require significant additional financing for planned research and development activities, capital expenditures, clinical testing for its QN-302 clinical trials, preclinical development of RAS and QN-247, and funding for NanoSynex operations, as well as commercialization activities.

Historically, the Company’s principal sources of cash have included proceeds from the issuance of common and preferred equity and proceeds from the issuance of debt. In December 2021, the Company raised $8.8 million from the issuance of common stock to several institutional investors, and in December 2022 the Company raised $3.0 million from the sale of an 8% Senior Convertible Debenture (the “Debenture”) to a related party (see Note 10 - Convertible Debt - Related Party). There can be no assurance that further financing can be obtained on favorable terms, or at all. If we are unable to obtain funding, we could be required to delay, reduce or eliminate research and development programs, product portfolio expansion or future commercialization efforts, which could adversely affect our business prospects.

On July 20, 2023, the Company entered into an Amendment and Settlement Agreement with NanoSynex Ltd. (the “NanoSynex Amendment”), which amended the Master Funding Agreement for the Operational and Technology Funding of NanoSynex Ltd., dated May 26, 2022, by and between the Company and NanoSynex (the “NanoSynex Funding Agreement”), a majority owned subsidiary of the Company, to, among other things, provide for the further funding of NanoSynex, as contemplated by the NanoSynex Funding Agreement (see Note 16 - Subsequent Events: Amendment and Settlement Agreement with NanoSynex Ltd. ).

Pursuant to the terms of the NanoSynex Amendment, the Company agreed to advance to NanoSynex an aggregate amount of $1,610,000 as follows: (i) $380,000 within five business days of the execution of the NanoSynex Amendment, (ii) $560,000 on or before November 30, 2023, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding, and (iii) $670,000 on or before March 31, 2024, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding. The NanoSynex Amendment further provides that the initial payment of $380,000 will be satisfied by the Company’s surrender of the 281,000 Preferred B Shares of NanoSynex currently held by the Company, resulting in the Company’s ownership in NanoSynex being reduced from approximately 52.8% to approximately 49.97% of the issued and outstanding voting equity of NanoSynex.

In the event we fail to make any future advances, we have agreed to forfeit additional shares in a number that will be equal to a fraction, the numerator of which is the amount of the default (i.e., the amount that we should have, but failed, to advance to NanoSynex pursuant to the terms of the NanoSynex Amendment), and the denominator of which shall be the price per share that we originally paid in consideration for our Preferred A-1 shares of NanoSynex to the previous holder thereof, being $1.5716 per share.

To the extent that the Company raises additional capital through the sale of equity or convertible debt securities, the ownership interests of its common stockholders will be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect the rights of our common stockholders. Debt financing, if available, may involve agreements that include covenants limiting or restricting our ability to take specific actions, such as incurring additional debt, making capital expenditures or declaring dividends. If the Company raises additional funds through government or other third-party funding, commercialization, marketing and distribution arrangements or other collaborations, strategic alliances or licensing arrangements with third parties, it may have to relinquish valuable rights to its technologies, future revenue streams, research programs or product candidates or grant licenses on terms that may not be favorable to the Company. Additional funding may not be available to the Company on acceptable terms, or at all. In addition, any future financing (depending on the terms and conditions) may be subject to the approval of Alpha Capital, the holder of the Debenture, or trigger certain adjustments to the Debenture or warrants held by Alpha Capital.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The financial statements do not include any adjustments that would be necessary should the Company be unable to continue as a going concern, and therefore, be required to liquidate its assets and discharge its liabilities in other than the normal course of business and at amounts that may differ from those reflected in the accompanying financial statements

NOTE 3— INVENTORY, NET

Inventory, net consisted of the following at June 30, 2023 and December 31, 2022:

SCHEDULE OF INVENTORY

	June 30, 2023		December 31, 2022
Raw materials	$	1,027,455	$	949,796
Work in process		177,591		200,318
Finished goods		358,353		436,183
Total inventory	$	1,563,399	$	1,586,297

NOTE 4 — PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consisted of the following at June 30, 2023 and December 31, 2022:

	June 30, 2023		December 31, 2022
Prepaid insurance	$	938,106	$	1,377,323
Prepaid manufacturing expenses		51,710		43,820
Other prepaid expenses		65,288		227,451
Prepaid research and development expenses		211,337		—
Other current assets		11,636		12,626
	$	1,278,077	$	1,661,220

NOTE 5 — PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of the following at June 30, 2023 and December 31, 2022:

SCHEDULE OF PROPERTY AND EQUIPMENT

	June 30, 2023			December 31, 2022
Machinery and equipment	$	2,735,507		$	2,510,148
Computer equipment		369,589			395,836
Leasehold improvements		336,916			333,271
Molds and tooling		260,002			260,002
Furniture and fixtures		144,832			144,832
Equipment held for lease		1,405,384			1,399,444
Property and equipment, gross		5,252,230			5,043,533
Accumulated depreciation		(4,678,583	)		(4,623,446	)
Fixed asset impairment		(75,000	)		(75,000	)
Property and equipment, net	$	498,647		$	345,087

Depreciation expense relating to property and equipment was approximately $19,000 and $24,000 for the three months ended June 30, 2023 and 2022, respectively, and $37,000 and $48,000 for the six months ended June 30, 2023 and 2022, respectively.

Upon termination of the Sekisui Distribution Agreement on March 31, 2022, the Company had a commitment to purchase leased FastPack rental systems back from Sekisui at Sekisui’s net book value, which was determined to be approximately $154,000. An assignment agreement was executed by the parties on June 26, 2023 to legally transfer title to this equipment from Sekisui to the Company, and this amount is included in accounts payable at June 30, 2023.

NOTE 6 — GOODWILL, IPR&D AND OTHER INTANGIBLES

		June 30,			December 31,
		2023			2022
	Estimated Useful Lives	Gross carrying amounts			Gross carrying amounts

Goodwill		$	625,602		$	625,602

Finite-lived intangible assets:
Developed-product-technology rights	8 - 17 years	$	479,103		$	479,103
Licensing rights	10 years		418,836			418,836
Less: Accumulated amortization			(764,869	)		(752,237	)
Total finite-lived intangible assets, net			133,070			145,702
Indefinite-lived intangible assets:
In-process research and development			5,700,000			5,700,000
Total other intangible assets, net		$	5,833,070		$	5,845,702

The Company periodically reviews goodwill for impairment in accordance with relevant accounting standards. Goodwill is attributable to the NanoSynex Acquisition. Goodwill and intangible assets are recognized at fair value during the period in which an acquisition is completed, from updated estimates during the measurement period, or when they are considered to be impaired. These non-recurring fair value measurements, primarily for goodwill and intangible assets acquired, were based on Level 3 inputs. The Company estimates the fair value of long-lived assets on a non-recurring basis based on a market valuation approach, engaging independent valuation experts to assist in the determination of fair value. In the fourth quarter of fiscal 2022, in conjunction with the annual impairment assessment, the Company determined that the fair value of the reporting unit was less than the carrying value. In addition to continued losses in the reporting unit, the Company considered macroeconomic conditions including a deterioration in the equity markets evidenced by sustained declines in the Company’s stock price, peer companies, and major market indices since the acquisition date. The Company engaged independent valuation experts to assist in determining the fair value of the reporting unit. As a result of this analysis, the Company recorded a $4,239,000 goodwill and fixed asset impairment charge associated with the reporting unit for fiscal year ended December 31, 2022. There were no impairment losses during the three and six months ended June 30, 2023 and 2022.

The carrying value of the patents of approximately $131,000 and $140,000 at June 30, 2023 and December 31, 2022, respectively, are stated net of accumulated amortization of approximately $348,000 and $339,000, respectively. Amortization of patents charged to operations for the three months ended June 30, 2023 and 2022 was approximately $9,000 and $5,000 respectively, and for the six months ended June 30, 2023 and 2022 was approximately $9,000 and $9,000, respectively.

The carrying value of the in-licenses of approximately $2,000 and $5,000 at June 30, 2023 and December 31, 2022, respectively, are stated net of accumulated amortization of approximately $417,000 and $414,000, respectively, and amortization of licenses charged to both the three months ended June 30, 2023 and 2022 was approximately $3,000. Amortization of licenses charged to operations for both the six months ended June 30, 2023 and 2022 was approximately $3,000.

On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. (see Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A.). Therefore, there is no future estimated amortization of patent and license costs for the five succeeding years.

NOTE 7 — ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following at June 30, 2023 and December 31, 2022:

	June 30, 2023		December 31, 2022
Board compensation	$	84,000		70,000
Equipment held for lease		—		154,433
Franchise, sales and use taxes		30,407		27,531
Income taxes		6,921		4,663
Interest (Convertible debt - related party)		50,101		2,829
License fees		100,026		150,130
Payroll		484,048		209,303
Professional fees		368,032		238,211
Research and development		523,490		322,987
Royalties		16,383		13,158
Warranty liability		140,370		137,568
Other		176,777		181,043
	$	1,980,555	$	1,511,856

NOTE 8 – SHORT TERM DEBT-RELATED PARTY

NanoSynex has four separate Notes Payable (‘the Notes”) outstanding to Alpha Capital, dated between March 26, 2020 and September 2, 2021, aggregating to a total principal outstanding balance of $905,000, and aggregate accrued interest of $60,155 for a total outstanding balance of $965,155 as of June 30, 2023. The Notes all accrue interest at 2.62% per annum, accrued daily, and provide that the full amount of principal and interest under each Note shall be due immediately prior to a Liquidation Event (the Maturity Date) unless due earlier in accordance with the terms of the Notes. “Liquidation Event” means either i) the merger or consolidation of NanoSynex into any other entity, other than one in control or under control of NanoSynex or NanoSynex’s majority shareholder; ii) a transaction or series of transactions resulting in the transfer of all or substantially all of NanoSynex’s assets or issued and outstanding share capital (other than to a company under the control of NanoSynex or NanoSynex’s majority shareholders; or iii) an underwritten public offering by NanoSynex of its ordinary shares. Notwithstanding the above, if NanoSynex receives subsequent debt, convertible debt, or equity funding with gross proceeds of USD $3,000,000 or more, then the unused portion of these Notes shall be due and payable upon the actual receipt of such funding. On July 20, 2023, the Company entered into an Amendment and Settlement Agreement with NanoSynex Ltd. (the “NanoSynex Amendment”), which amended the Master Funding Agreement for the Operational and Technology Funding of NanoSynex Ltd., dated May 26, 2022, by and between the Company and NanoSynex (the “NanoSynex Funding Agreement”), a majority owned subsidiary of the Company, to, among other things, provide for the further funding of NanoSynex, as contemplated by the NanoSynex Funding Agreement (see Note 16 - Subsequent Events: Amendment and Settlement Agreement with NanoSynex Ltd. ).

NOTE 9 – WARRANT LIABILITIES

In 2004, the Company issued warrants to various investors and brokers for the purchase of Series C preferred stock in connection with a private placement (the “Series C Warrants”). The Series C Warrants were subsequently extended and, upon closing of the reverse recapitalization transaction with Ritter, exchanged for warrants to purchase common stock of the Company, pursuant to the Series C Warrant terms as adjusted.

In exchange for the Series C Warrants, upon closing of the merger with Ritter, the holders received warrants to purchase shares of the Company’s common stock at $7.195 per share, subject to adjustment. As of June 30, 2023, the Series C Warrants have remaining terms ranging from .40 to .99 years. The Series C Warrants were determined to be liability-classified pursuant to the guidance in ASC 480 and ASC 815-40, based on the inclusion of a leveraged ratchet provision for subsequent dilutive issuances. On April 25, 2022, the Series C Warrants were repriced from $7.195 to $6.00 with 49,318 additional ratchet Warrants issued, and on May 26, 2022, the Series C Warrants were repriced from $6.00 to $5.136 with 49,952 additional ratchet Warrants issued. As a result of these repricings, 247,625 warrants were forfeited and 346,896 warrants were reissued. On December 22, 2022, the Series C Warrants were repriced again from $5.136 to $1.32 with 1,002,717 additional ratchet Warrants issued.

Additionally, on December 22, 2022, in conjunction with the issuance of the Debenture to Alpha Capital (see Note 10 – Convertible Debt – Related Party), the Company issued to Alpha Capital a warrant to purchase 2,500,000 shares of the Company’s common stock (the “Alpha Warrant”). The exercise price of the Alpha Warrant is $1.65 (equal to 125% of the conversion price of the Debenture on the closing date). The Alpha Warrant may be exercised by Alpha Capital, in whole or in part, at any time on or after June 22, 2023 and before June 22, 2028, subject to certain terms and conditions described in the Alpha Warrant, including the Company’s receipt of the necessary stockholder approvals.

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2023:

SCHEDULE OF WARRANTS ACTIVITY

	Common Stock Warrants
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		3,849,571	$	1.53		$1.32 - $1.65		3.9
Exercised		—		—		—		—
Forfeited		—		—		—		—
Expired		—		—		—		—
Granted		—		—		—		—
Total outstanding – June 30, 2023		3,849,571	$	1.53		$1.32 - $1.65		3.41
Exercisable		3,849,571	$	1.53		$1.32 - $1.65		3.41

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2022:

	Common Stock Warrants
	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding –December 31, 2021		248,161		$	7.20				2.00
Exercised		(536	)		7.20
Forfeited		(247,625	)		7.20
Expired		—			—
Granted		346,896			5.10
Total outstanding – June 30, 2022		346,896		$	5.10
Exercisable		346,896		$	5.10	$	5.10		1.51

The following table presents the Company’s fair value hierarchy for its liabilities measured at fair value on a recurring basis as of June 30, 2023:

	Quoted
	Market		Significant
	Prices for		Other		Significant
	Identical		Observable		Unobservable
	Assets		Inputs		Inputs
Common Stock Warrant liabilities	(Level 1)		(Level 2)		(Level 3)			Total
Balance as of December 31, 2022	$	—	$	—	$	3,622,647		$	3,622,647
Exercises		—		—		—			—
Gain on change in fair value of warrant liabilities		—		—		(1,478,967	)		(1,478,967	)
Balance as of June 30, 2023	$	—	$	—	$	2,143,680		$	2,143,680

There were no transfers of financial assets or liabilities between category levels for the three and six months ended June 30, 2023.

The value of the warrant liabilities was based on a valuation received from an independent valuation firm determined using a Monte-Carlo simulation. For volatility, the Company considers comparable public companies as a basis for its expected volatility to calculate the fair value of common stock warrants and transitions to its own volatility as the Company develops sufficient appropriate history as a public company. The risk-free interest rate is based on U.S. Treasury notes with a term approximating the expected term of the common stock warrant. The Company uses an expected dividend yield of zero based on the fact that the Company has never paid cash dividends and does not expect to pay cash dividends in the foreseeable future. Any significant changes in the inputs may result in significantly higher or lower fair value measurements.

The following are the weighted average and the range of assumptions used in estimating the fair value of warrant liabilities (weighted average calculated based on the number of outstanding warrants on each issuance) as of June 30, 2023 and 2022:

	June 30, 2023						June 30, 2022
	Range			Weighted Average			Range			Weighted Average
Risk-free interest rate	4.05% — 5.31%				4.49	%	2.80% — 2.87%				2.82	%
Expected volatility (peer group)	66.3% — 134%				110.55	%	74% — 96%				78.6	%
Term of warrants (in years)	.39 — 4.98			3.41			1.39 — 1.99			1.51
Expected dividend yield		0.00	%		0.00	%		0.00	%		0.00	%

NOTE 10 — CONVERTIBLE DEBT- RELATED PARTY

On December 22, 2022, the Company issued to Alpha Capital, an 8% Senior Convertible Debenture in the aggregate principal amount of $3,300,000 for a purchase price of $3,000,000 pursuant to the terms of a Securities Purchase Agreement, dated December 21, 2022. The Debenture is convertible, at any time, and from time to time, at Alpha Capital’s option, into shares of common stock of the Company (the “Conversion Shares”), at a price equal to $1.32 per share, subject to adjustment as described in the Debenture (the “Conversion Price”) and other terms and conditions described in the Debenture, including the Company’s receipt of the necessary stockholder approvals. Additionally, on December 22, 2022, the Company issued to Alpha Capital a liability classified warrant to purchase 2,500,000 shares of the Company’s common stock (see Note 9 - Warrant Liabilities). The exercise price of the Alpha Warrant is $1.65 (equal to 125% of the Conversion Price of the Debenture on the closing date). The Alpha Warrant may be exercised by Alpha Capital, in whole or in part, at any time on or after June 22, 2023 and before June 22, 2028, subject to certain terms and conditions described in the Alpha Warrant, including the Company’s receipt of the necessary stockholder approvals, which the Company obtained at its 2023 annual meeting of stockholders.

The proceeds from the transaction are being used to advance the Company’s QN-302 Investigative New Drug candidate towards clinical trials and other working capital purposes.

Commencing June 1, 2023 and continuing on the first day of each month thereafter until the earlier of (i) December 22, 2025 and (ii) the full redemption of the Debenture (each such date, a “Monthly Redemption Date”), the Company will redeem $110,000 plus accrued but unpaid interest, liquidated damages and any amounts then owing under the Debenture (the “Monthly Redemption Amount”). The Monthly Redemption Amount will be paid in cash; provided that after the first two monthly redemptions, the Company may elect to pay all or a portion of a Monthly Redemption Amount in shares of common stock of the Company, based on a Conversion Price equal to the lesser of (i) the then Conversion Price of the Debenture and (ii) 85% of the average of the VWAPs (as defined in the Debenture) for the five consecutive trading days ending on the trading day that is immediately prior to the applicable Monthly Redemption Date. The Company may also redeem some or all of the then outstanding principal amount of the Debenture at any time for cash in an amount equal to 105% of the then outstanding principal amount of the Debenture being redeemed plus accrued but unpaid interest, liquidated damages and any amounts then owing under the Debenture. The Company’s election to pay monthly redemptions in Conversion Shares or to effect an optional redemption is subject to the satisfaction of the Equity Conditions (as defined in the Debenture), including the Company’s receipt of the necessary stockholder approvals, which the Company obtained at its 2023 annual meeting of stockholders.

The Debenture accrues interest at the rate of 8% per annum, which does not begin accruing until December 1, 2023, and will be payable on a quarterly basis. Interest may be paid in cash or shares of common stock of the Company or a combination thereof at the option of the Company; provided that interest may only be paid in shares if the Equity Conditions have been satisfied, including the Company’s receipt of the necessary stockholder approvals, which the Company obtained at its 2023 annual meeting of stockholders.

Both the Debenture and the Alpha Warrant provide for adjustments to the Conversion Price and exercise price, respectively, in connection with stock dividends and splits, subsequent equity sales and rights offerings, pro rata distributions, and certain fundamental transactions. Both the Debenture and the Alpha Warrant include a beneficial ownership blocker of 9.99%, which may only be waived by Alpha Capital upon 61 days’ notice to the Company.

The Company filed a registration statement on Form S-3 (No. 333-269088) with the Securities and Exchange Commission on December 30, 2022 registering the resale by Alpha Capital of an aggregate of 5,157,087 shares of the Company’s common stock, which may be issuable to Alpha Capital pursuant to the terms of the Debenture and the Alpha Warrant.

The Company evaluated the Debenture and the Alpha Warrant and determined that the Alpha Warrant is a freestanding financial instrument. The Alpha Warrant is not considered indexed to the Company’s own stock, because the settlement amount would not equal the difference between the fair value of a fixed number of the Company’s equity shares and a fixed strike price and all of the adjustment features in Section 3(b) of the warrant agreement are not down round provisions, as defined in ASU 2017-11. Accordingly, the Alpha Warrant is classified as a liability and recognized at fair value, with subsequent changes in fair value recognized in earnings.

The proceeds from the Debenture were allocated to the initial fair value of the Alpha Warrant, with the residual balance allocated to the initial carrying value of the Debenture. The Company has not elected the fair value option for the Debenture. The Debenture was recognized as proceeds received after allocating the proceeds to the Alpha Warrant, and then allocating remaining proceeds to a suite of bifurcated embedded derivative features (conversion option, contingent acceleration upon an Event of Default, and contingent interest upon an Event of Default), with the resulting difference, if any, allocated to the loan host instrument. The suite of derivative features was measured and determined to have no fair value.

The original issue discount of $0.3 million, the initial fair value of the Warrant of $2.8 million, the initial fair value of the suite of bifurcated embedded derivative features of $0, and the fees and costs paid to Alpha Capital and other third parties of $0.1 million comprised the debt discount upon issuance. The debt discount is amortized to interest expense over the expected term of the Debenture using the effective interest method, in accordance with ASC 835-30. The debt host instrument of the Debenture will subsequently be measured at amortized cost using the effective interest method to accrete interest over its term to bring the Debenture’s initial carrying value to the principal balance at maturity.

Between January 9 and 12, 2023, the Company issued 841,726 shares of common stock upon Alpha Capital’s partial conversion of the Debenture at $1.32 per share for a total of $1,111,078 principal. Upon conversion, the Company recognized a loss on conversion of convertible debt of approximately $1.1 million, recorded to other expenses in the condensed consolidated statements of operations. During the three and six months ended June 30, 2023, the Company recorded accrued interest of approximately $383,000 and $945,000, respectively (of which approximately $364,000 and $898,000 was attributable to discount amortization, respectively) in other expenses in the condensed consolidated statements of operations. As of June 30, 2023, the fair value of the Alpha Warrant was approximately $2.0 million, and the fair value of the suite of bifurcated embedded derivative features was $0.

Convertible debt-related party is comprised of the following as of June 30, 2023 and December 31, 2022:

	June 30, 2023			December 31, 2022
Senior secured convertible debenture	$	2,078,922		$	3,300,000
Discount on convertible debenture		(1,266,503	)		(3,239,803	)
Total convertible debt-related party	$	812,419		$	60,197

As of June 30, 2023, there were no events of default or violation of any covenants under our financing obligations.

NOTE 11 — EARNINGS (LOSS) PER SHARE

Basic loss per share (“EPS”) is computed by dividing net loss by the weighted-average number of common shares outstanding. Diluted EPS is computed based on the sum of the weighted-average number of common shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares consist of shares issuable from stock options and warrants.

The following potentially dilutive securities have been excluded from diluted net loss per share as of June 30, 2023 and 2022 because their effect would be anti-dilutive:

	As of June 30,
	2023		2022
Shares of common stock subject to outstanding options		445,163		476,783
Shares of common stock subject to outstanding warrants		4,119,934		1,412,338
Total common stock equivalents		4,565,097		1,889,121

NOTE 12 — COMMITMENTS AND CONTINGENCIES

Leases

The Company leases its facilities under a long-term operating lease agreement. On December 15, 2021, our wholly-owned subsidiary Qualigen, Inc. entered into a Second Amendment to Lease with Bond Ranch LP. This Amendment extended the Company’s triple-net leasehold on the Company’s existing 22,624-square-feet headquarters/manufacturing facility at 2042 Corte del Nogal, Carlsbad, California for the 61-month period of November 1, 2022 to November 30, 2027. Over the 61 months, the base rent payable by Qualigen, Inc. will total $1,950,710; however, the base rent for the first 12 months of the 61-month period will be only $335,966. Additionally, under the Second Amendment to Lease, Qualigen, Inc. is entitled to a $339,360 tenant improvement allowance.

The tables below show the operating lease right-of-use assets and operating lease liabilities as of June 30, 2023, including the changes during the periods:

	Operating lease right-of-use assets
Net right-of-use assets at December 31, 2022	$	1,422,538
Less amortization of operating lease right-of-use assets		(116,568	)
Operating lease right-of-use assets at June 30, 2023	$	1,305,970

	Operating lease liabilities
Lease liabilities at December 31, 2022	$	1,542,564
Less principal payments on operating lease liabilities		(116,756	)
Lease liabilities at June 30, 2023		1,425,808
Less non-current portion		(1,168,653	)
Current portion at June 30, 2023	$	257,155

As of June 30, 2023, the Company’s operating leases have a weighted-average remaining lease term of 4.3 years and a weighted-average discount rate of 8.9%.

As of June 30, 2023, future minimum payments during the next five fiscal years and thereafter are as follows:

Year Ending December 31,	Amount
2023 (six months)		184,171
2024		379,392
2025		390,773
2026		402,497
2027		379,164
Total		1,735,997
Less present value discount		(310,189	)
Operating lease liabilities	$	1,425,808

Total lease expense was approximately $114,000 and $119,000 for the three months ended June 30, 2023 and 2022, respectively, and approximately $230,000 and $233,000, respectively, for the six months ended June 30, 2023 and 2022. Lease expense was recorded in cost of product sales, general and administrative expenses, research and development and sales and marketing expenses.

On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. The lease commitments described above transferred to Chembio upon the closing of this transaction. (see Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A. ).

NanoSynex Funding Commitment

The Nanosynex Amendment supersedes any payments contemplated by the Original Nanosynex Agreement, such that except as described in the Nanosynex Amendment, the Company will have no further payment obligations to NanoSynex under the Original Nanosynex Agreement or otherwise (including by way of equity investment, loan financing or credit lines), and Nanosynex will have no further payment obligations to the Company for advances previously received under the Original Nanosynex Agreement.

Litigation and Other Legal Proceedings

On November 9, 2021, the Company was named as a defendant in an action brought by Mediant Communications Inc. (“Mediant”) in the U.S. District Court for the Southern District of New York. The complaint alleged that Qualigen entered into an implied contract with Mediant, whereby Qualigen retained Mediant to distribute proxy materials and subsequently conduct shareholder vote tabulations. The Company filed a Motion to Dismiss with the District Court and on March 14, 2022 a hearing was held during which the presiding judge ruled in favor of the Motion to Dismiss. The Company and Mediant settled the litigation on April 5, 2022 in the amount of $96,558, at which time the amount was paid.

NOTE 13 — RESEARCH AND LICENSE AGREEMENTS

The University of Louisville Research Foundation

Between June 2018 and April 2022, the Company entered into license and sponsored research agreements with the University of Louisville Research Foundation (“ULRF”) for QN-247, a novel aptamer-based compound that has shown promise as an anticancer drug. Under the agreements, the Company took over development, regulatory approval and commercialization of the compound from ULRF and is responsible for maintenance of the related intellectual property portfolio. In return, ULRF received a $50,000 convertible promissory note in payment of an upfront license fee, which was subsequently converted into the Company’s common stock, and the Company agreed to reimburse ULRF for sponsored research expenses of up to approximately $805,000 and prior patent costs of up to $200,000. In addition, the Company agreed to pay ULRF (i) royalties, on patent-covered net sales associated with the commercialization of anti-nucleolin agent-conjugated nanoparticles, of 4% (on net sales up to a cumulative $250,000,000) or 5% (on net sales above a cumulative $250,000,000), until expiration of the last to expire of the licensed patents, (ii) 30% to 50% of any non-royalty sublicensee income received (50% for sublicenses granted in the first two years of the ULRF license agreement, 40% for sublicenses granted in the third or fourth years of the ULRF license agreement, and 30% for sublicenses granted in the fifth year of the ULRF license agreement or thereafter), (iii) reimbursements for ongoing costs associated with the preparation, filing, prosecution and maintenance of licensed patents, incurred prior to June 2018, and (iv) payments ranging from $100,000 to $5,000,000 upon the achievement of certain regulatory and commercial milestones. Milestone payments for the first therapeutic indication would be $100,000 for first dosing in a Phase 1 clinical trial, $200,000 for first dosing in a Phase 2 clinical trial, $350,000 for first dosing in a Phase 3 clinical trial, $500,000 for regulatory marketing approval and $5,000,000 upon achieving a cumulative $500,000,000 of Licensed Product sales. The Company also agreed to pay another $500,000 milestone payment for any additional regulatory marketing approval for each additional therapeutic (or diagnostic) indication. The Company must also pay ULRF shortfall payments if the total amounts actually paid with respect to royalties and non-royalty sublicensee income for any year is less than the applicable annual minimum (ranging from $10,000 to $50,000) for such year.

Sponsored research expenses related to these agreements for the three months ended June 30, 2023 and 2022 were approximately $0 and $77,000, respectively, and for the six months ended June 30, 2023 and 2022 were approximately $0 and $164,000, respectively, and these amounts are recorded in research and development expenses in the condensed consolidated statements of operations and other comprehensive loss. License costs were approximately $1,000 and $14,000 related to these agreements for the three months ended June 30, 2023 and 2022, respectively, and approximately $22,000 and $69,000 related to these agreements for the six months ended June 30, 2023 and 2022, respectively, and are included in research and development expenses in the condensed consolidated statements of operations and other comprehensive loss.

In March 2019, the Company entered into a sponsored research agreement and an option for a license agreement with ULRF for development of several small-molecule RAS interaction inhibitor drug candidates. Under the terms of this agreement, the Company agreed to reimburse ULRF for sponsored research expenses of up to $693,000 for this program. In February 2021 and March 2022, the Company extended the term of this agreement until January 2023 and increased the amount that the Company will reimburse ULRF for sponsored research expenses to approximately $2.7 million. In July 2020, the Company entered into an exclusive license agreement with ULRF for RAS interaction inhibitor drug candidates. Under the agreement, the Company took over development, regulatory approval and commercialization of the candidates from ULRF and is responsible for maintenance of the related intellectual property portfolio. In return, ULRF received approximately $112,000 for an upfront license fee and reimbursement of prior patent costs. In addition, the Company has agreed to pay ULRF (i) royalties, on patent-covered net sales associated with the commercialization, of 4% (on net sales up to a cumulative $250,000,000) or 5% (on net sales above a cumulative $250,000,000), until expiration of the licensed patent, and 2.5% (on net sales for any sales not covered by Licensed Patents), (ii) 30% to 50% of any non-royalty sublicensee income received (50% for sublicenses granted in the first two years of the ULRF license agreement, 40% for sublicenses granted in the third or fourth years of the ULRF license agreement, and 30% for sublicenses granted in the fifth year of the ULRF license agreement or thereafter), (iii) reimbursements for ongoing costs associated with the preparation, filing, prosecution and maintenance of licensed patents, incurred prior to July 2020, and (iv) payments ranging from $50,000 to $5,000,000 upon the achievement of certain regulatory and commercial milestones. Milestone payments for the first therapeutic indication would be $50,000 for first dosing in a Phase 1 clinical trial, $100,000 for first dosing in a Phase 2 clinical trial, $150,000 for first dosing in a Phase 3 clinical trial, $300,000 for regulatory marketing approval and $5,000,000 upon achieving a cumulative $500,000,000 of Licensed Product sales. The Company also must pay ULRF shortfall payments if the total amounts actually paid with respect to royalties and non-royalty sublicensee income for any year is less than the applicable annual minimum (ranging from $20,000 to $100,000) for such year.

Sponsored research expenses related to these agreements for the three months ended June 30, 2023 and 2022 were approximately $333,000 and $220,000, respectively, and for the six months ended June 30, 2023 and 2022 were approximately $556,000 and $405,000, respectively, and are recorded in research and development expenses in the condensed consolidated statements of operations and other comprehensive loss. License costs related to these agreements for the three months ended June 30, 2023 and 2022 were approximately $15,000 and $16,000, respectively, and for the six months ended June 30, 2023 and 2022 were approximately $29,000 and $18,000, respectively, and are included in research and development expenses in the condensed consolidated statements of operations and other comprehensive loss.

In June 2020, the Company entered into an exclusive license agreement with ULRF for its intellectual property in the use of QN-165 as a treatment for COVID-19. Under the agreement, the Company took over development, regulatory approval and commercialization of the compound (for such use) from ULRF and is responsible for maintenance of the related intellectual property portfolio. In return, ULRF received approximately $24,000 for an upfront license fee and reimbursement of prior patent costs. In addition, the Company was required to enter into a separate sponsored research agreement with ULRF (for QN-165 as a treatment for COVID-19) for at least $250,000. In November 2020, the Company executed a sponsored research agreement with ULRF (for QN-165 as a treatment for COVID-19) supporting up to approximately $430,000 in research which satisfied this requirement. This sponsored research agreement expired in November 2021.

In addition, under the exclusive license agreement the Company agreed to pay ULRF (i) royalties, on patent-covered net sales associated with the commercialization of QN-165 as a treatment for COVID-19, of 4% (on net sales up to a cumulative $250,000,000) or 5% (on net sales above a cumulative $250,000,000), until expiration of the licensed patents, and 2.5% (on net sales for any sales not covered by Licensed Patents), (ii) 30% to 50% of any non-royalty sublicensee income received (50% for sublicenses granted in the first two years of the ULRF license agreement, 40% for sublicenses granted in the third or fourth years of the ULRF license agreement, and 30% for sublicenses granted in the fifth year of the ULRF license agreement or thereafter), (iii) reimbursements for ongoing costs associated with the preparation, filing, prosecution and maintenance of licensed patents, incurred prior to June 2020, and (iv) payments ranging from $50,000 to $5,000,000 upon the achievement of certain regulatory and commercial milestones. Milestone payments would be $50,000 for first dosing in a Phase 1 clinical trial, $100,000 for first dosing in a Phase 2 clinical trial, $150,000 for first dosing in a Phase 3 clinical trial, $300,000 for regulatory marketing approval and $5,000,000 upon achieving a cumulative $500,000,000 of Licensed Product sales. The Company must also pay ULRF shortfall payments if the total amounts actually paid with respect to royalties and non-royalty sublicensee income for any year is less than the applicable annual minimum (ranging from $5,000 to $50,000) for such year.

There were no sponsored research expenses or license costs related to these agreements for the three months ended June 30, 2023 and 2022, or for the six months ended June 30, 2023 and 2022.

Yi Xin

In October 2020, through its wholly-owned diagnostics subsidiary Qualigen, Inc., the Company entered into a Technology Transfer Agreement with Yi Xin Zhen Duan Jishu (Suzhou) Ltd. (“Yi Xin”), of Suzhou, China, for Yi Xin to develop, manufacture and sell new generations of diagnostic test systems based on the Company’s core FastPack technology. In addition, the Technology Transfer Agreement authorizes Yi Xin to manufacture and sell the Company’s current generations of FastPack System diagnostic products (1.0, IP and PRO) in China.

The Company will receive low- to mid-single-digit royalties on any future new-generations and current-generations product sales by Yi Xin. Under the Technology Transfer Agreement, during the fiscal year ended December 31, 2021 we recognized revenues of approximately $670,000. There were no revenues under this agreement for the three months ended June 30, 2023, and the three months ended June 30, 2022. The Company provided technology transfer and patent/know-how license rights to facilitate Yi Xin’s development and commercialization.

The Company gave Yi Xin the exclusive rights for China, which is a market it has not otherwise entered, both for Yi Xin’s new generations of FastPack-based products and for Yi Xin-manufactured versions of our existing FastPack product lines. Yi Xin also has the right to sell its new generations of FastPack-based diagnostic test systems throughout the world (but not to or toward current customers of the Company’s existing generations of FastPack products). After March 31, 2022, Yi Xin has the right to sell Yi Xin-manufactured versions of existing FastPack 1.0, IP and PRO product lines worldwide (other than in the United States and other than to or toward current non-US customers of those products), as well as the right to buy Qualigen-manufactured FastPack 1.0, IP and PRO products from us at distributor prices for resale in and for the United States (but not to or toward current U.S. customers of those products). The Company did not license Yi Xin to sell in the U.S. market any Yi Xin-manufactured versions of those legacy FastPack 1.0, IP and PRO product lines. In the Technology Transfer Agreement the Company also confirmed that after March 31, 2022 it would not seek new FastPack customers outside the United States, European Union, Canada and Mexico.

On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. The Technology Transfer Agreement with Yi Xin described above transferred to Chembio upon the closing of this transaction. See Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A. to our unaudited condensed consolidated financial statements for additional details.

UCL Business Limited

In January 2022, the Company entered into a License Agreement with UCL Business Limited to obtain an exclusive worldwide in-license of a genomic quadruplex (G4)-selective transcription inhibitor drug development program which had been developed at University College London, including lead and back-up compounds, preclinical data and a patent estate. (UCL Business Limited is the commercialization company for University College London.) The program’s lead compound is now being developed at Qualigen under the name QN-302 as a candidate for treatment for pancreatic ductal adenocarcinoma (PDAC), which represents the vast majority of pancreatic cancers. The License Agreement required a $150,000 upfront payment, reimbursement of past patent prosecution expenses (approximately $160,000), and (if and when applicable) tiered royalty payments in the low to mid-single digits, clinical/regulatory/sales milestone payments and a percentage of any non-royalty sublicensing consideration paid to Qualigen.

For both the three months ended June 30, 2023 and 2022, there were license costs of $0, and for the six months ended June 30, 2023 and 2022, there were license costs of approximately $0 and $310,000, respectively, related to this agreement which are included in research and development expenses in the condensed consolidated statements of operations and other comprehensive loss.

Prediction Biosciences

In November 2015, the Company entered into a long-term development and supply agreement with Prediction Biosciences SAS to develop and manufacture diagnostic tests for use in the stroke Physician Office Laboratory (POL) market. The Company recognizes development revenue and product sales over the performance period of the contract. Product sales related to this agreement for the three months ended June 30, 2023 and 2022 were $0 for both periods, and for the six months ended June 30, 2023 and 2022 were approximately $86,000 and $0, respectively, and are recorded in net product sales in the condensed consolidated statements of operations and other comprehensive loss.

QN-302 Phase 1 Study

In June 2023, the Company entered into a Master Clinical Research Services Agreement with Translational Drug Development, LLC (“TD2”) where TD2 agreed to perform certain clinical research and development services for the Company including but not limited to trial management, side identification and selection, site monitoring/management, medical monitoring, project management, data collection, statistical programming or analysis, quality assurance auditing, scientific and medical communications, regulatory affairs consulting and submissions, strategic consulting, and/or other related services. From time to time, the Company shall enter into Statements of Work (“SOW”) with TD2 for the performance of specific services under this Master Clinical Research Services Agreement (see Note 16 - Subsequent Events: QN-302 Phase 1 Study).

In June 2023, the Company entered into a Master Laboratory Services Agreement with MLM Medical Labs, LLC (“MLM”) where MLM agreed to perform certain clinical research and development services for the Company including but not limited to laboratory, supply, testing, validation, data management, and storage services. From time to time, the Company shall enter into work orders with MLM for the performance of specific services under this Master Laboratory Services Agreement (see Note 16 - Subsequent Events: QN-302 Phase 1 Study).

In June 2023, the Company entered into a Master Services Agreement with Clinigen Clinical Supplies Management, Inc. (“Clinigen”) where Clinigen agreed to provide certain pharmaceutical products and/or services. From time to time, the Company shall enter into Statements of Work (“SOW”) with Clinigen for the performance of specific services under this Master Services Agreement (see Note 16 - Subsequent Events: QN-302 Phase 1 Study).

NOTE 14 — STOCKHOLDERS’ EQUITY

As of June 30, 2023 and December 31, 2022, the Company had two classes of authorized capital stock: common stock and preferred stock.

Common Stock

Holders of common stock generally vote as a class with the holders of the preferred stock and are entitled to one vote for each share held. Subject to the rights of the holders of the preferred stock to receive preferential dividends, the holders of common stock are entitled to receive dividends when and if declared by the Board of Directors. Following payment of the liquidation preference of the preferred stock, any remaining assets will be distributed ratably among the holders of the common stock and, on an as-if-converted basis, the holders of any preferred stock upon liquidation, dissolution or winding up of the affairs of the Company. The holders of common stock have no preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions.

At June 30, 2023, the Company has reserved 4,565,097 shares of authorized but unissued common stock for possible future issuance. At June 30, 2023, shares were reserved in connection with the following:

SCHEDULE OF RESERVED SHARES


Exercise of issued and future grants of stock options			445,163
Exercise of stock warrants			4,119,934
Total			4,565,097

Preferred Stock

At June 30, 2023 and December 31, 2022, there were no shares of preferred stock outstanding.

Stock Options and Warrants

Stock Options

The Company recognizes all compensatory share-based payments as compensation expense over the service period, which is generally the vesting period.

In April 2020, the Company adopted the 2020 Stock Incentive Plan (the “2020 Plan”), which provides for the granting of incentive or non-statutory common stock options and other types of awards to qualified employees, officers, directors, consultants and other service providers. At June 30, 2023 and December 31, 2022, there were 445,163 and 608,012 outstanding stock options, respectively, under the 2020 Plan and on such dates there were 310,539 and 147,690 shares reserved under the 2020 Plan, respectively, for future grant.

The following represents a summary of the options granted (under the 2020 Plan and otherwise) to employees and non-employee service providers that are outstanding at June 30, 2023, and changes during the six-month period then ended:

SCHEDULE OF STOCK OPTION ACTIVITY

	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		608,012		$	35.02		$5.14 - $51.30		8.09
Granted		—			—		—		—
Expired		—			—		—		—
Forfeited		(162,849	)		36.01		5.14 - 51.30		—
Total outstanding – June 30, 2023		445,163		$	34.68		$5.14 — $51.30		7.59
Exercisable (vested)		323,355		$	44.79		$5.14 — $51.30		7.13
Non-Exercisable (non-vested)		121,808		$	7.83		$5.14 - $35.20		8.85

There was approximately $0.9 and $2.7 million of compensation cost related to outstanding stock options for the six months ended June 30, 2023 and 2022, respectively. As of June 30, 2023, there was approximately $0.5 million of total unrecognized compensation cost related to unvested stock-based compensation arrangements. This cost is expected to be recognized over a weighted average period of 1.47 years.

	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		484,186		$	60.70	$12.40 — $14,657.50			8.52
Granted		2,500			10.50		10.50		9.54
Expired		(9,386	)		935.90		57.50 - 14,657.50		—
Forfeited		(517	)		35.10		12.40 - 49.70		—
Total outstanding – June 30, 2022		476,783		$	43.30		$10.50 — $51.30		8.19
Exercisable (vested)		264,366		$	48.40		$12.40 — $50.13		8.00
Non-Exercisable (non-vested)		212,417		$	36.80		$10.50 — $51.30		8.48

The exercise price for an option issued under the 2020 Plan is determined by the Board of Directors, but will be (i) in the case of an incentive stock option (A) granted to an employee who, at the time of grant of such option, is a 10% stockholder, no less than 110% of the fair market value per share on the date of grant; or (B) granted to any other employee, no less than 100% of the fair market value per share on the date of grant; and (ii) in the case of a non-statutory stock option, no less than 100% of the fair market value per share on the date of grant. The options awarded under the 2020 Plan will vest as determined by the Board of Directors but will not exceed a ten-year period.

Fair Value of Equity Awards

The Company utilizes the Black-Scholes option pricing model to value awards under its equity plans. Key valuation assumptions include:

●	Expected dividend yield. The expected dividend is assumed to be zero, as the Company has never paid dividends and has no current plans to pay any dividends on the Company’s common stock.

●

Expected stock-price volatility. The Company’s expected volatility is derived from the average historical volatilities of publicly traded companies within the Company’s industry that the Company considers to be comparable to the Company’s business over a period approximately equal to the expected term.

●	Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to the expected term.

●

Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The Company’s historical share option exercise experience does not provide a reasonable basis upon which to estimate an expected term because of a lack of sufficient data. Therefore, the Company estimates the expected term by using the simplified method provided by the SEC. The simplified method calculates the expected term as the average of the time-to-vesting and the contractual life of the options.

The material factors incorporated in the Black-Scholes model in estimating the fair value of the options granted for the periods presented were as follows:

	For the Six Months Ended June 30,
	2023			2022
Expected dividend yield		0.00	%		0.00	%
Expected stock-price volatility		—			102	%
Risk-free interest rate		—		1.58% — 1.67		%
Expected average term of options (in years)		—			6.00
Stock price	$	—		$	1.05

The Company recorded share-based compensation expense and classified it in the unaudited condensed consolidated statements of operations as follows:

	2023		2022
	For the Six Months Ended June 30,
	2023		2022
General and administrative	$	807,980	$	2,329,418
Research and development		98,165		361,029
Total	$	906,145	$	2,690,447

Equity Classified Compensatory Warrants

In connection with the $4.0 million equity capital raise as part of the May 2020 reverse recapitalization transaction, the Company issued common stock warrants to an advisor and its designees for the purchase of 81,143 reverse split adjusted shares of the Company’s common stock at a reverse split adjusted exercise price of $11.10 per share. The issuance cost of these warrants was charged to additional paid-in capital, and did not result in expense in the Company’s condensed consolidated statements of operations and comprehensive loss.

In addition, various service providers hold equity classified compensatory warrants issued in 2017 and earlier for the purchase of 66,802 reverse split adjusted shares of Company common stock (originally exercisable to purchase Series C convertible preferred stock) at a weighted average exercise price of $23.40 per share. These are to be differentiated from the Series C Warrants described in Note 9 - Warrant Liabilities.

During the year ended December 31, 2021, the Company issued equity classified compensatory warrants to a service provider for the purchase of 60,000 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $13.20 per share. The fair value issuance cost of approximately $0.3 million using the Black-Scholes options pricing model for these warrants was charged to general and administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive loss. On April 25, 2022, 60,000 warrants were repriced from $13.20 to a reverse split adjusted exercise price of $6.00 and extended from June 3, 2023 to September 14, 2023. The increase in fair value of $67,370 using a Monte Carlo pricing model for the modification of these warrants was charged to general and administrative expenses in the Company’s condensed consolidated statements of operations and comprehensive loss. On April 25, 2022 and May 26, 2022 an additional 67,619 reverse split adjusted warrants were repriced from a reverse split adjusted exercise price of $11.10 to $5.136. The increase in fair value of $31,010 using a Monte Carlo pricing model for the modification of these warrants was charged to additional paid-in capital and did not result in expense on the Company’s condensed consolidated statements of operations and comprehensive loss. On December 22, 2022, 67,620 warrants were repriced from a reverse split adjusted exercise price of $5.136 to $1.32. The increase in fair value of $8,548 using a Monte Carlo pricing model for the modification of these warrants was charged to additional paid-in capital and did not result in expense on the Company’s condensed consolidated statements of operations and comprehensive loss.

No compensatory warrants were issued during the six months ended June 30, 2023.

The following table summarizes the activity in the common stock equity classified compensatory warrants for the six months ended June 30, 2023:

SCHEDULE OF WARRANT ACTIVITY

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		179,046	$	9.12	$1.32 — $25.40		1.73
Granted to advisor and its designees		—		—
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2023		179,046	$	9.12	$1.32 — $25.40		1.24
Exercisable		179,046	$	9.12	$1.32 — $25.40			1.24
Non-Exercisable		—	$	—	$	—		—

The following table summarizes the activity in the common stock equity classified compensatory warrants for the six months ended June 30, 2022:

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		179,065	$	15.20	$11.10 — $25.40		2.64
Granted to advisor and its designees		—		—
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2022		179,065	$	10.60	$5.14 — $25.40		2.23
Exercisable		179,065	$	10.60	$5.14 — $25.40			2.23
Non-Exercisable		—	$	—	$	—		—

There were no compensation costs related to outstanding equity classified compensatory warrants for the six months ended June 30, 2023 and $67,370 for the six months ended June 30, 2022.

Noncompensatory Equity Classified Warrants

In May 2020, as a commitment fee, the Company issued noncompensatory equity classified warrants to Alpha Capital (a related party) for the purchase of 27,048 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $11.10 per share (of which warrants for 20,000 shares were subsequently exercised in December 2020). In July 2020, the Company issued noncompensatory equity classified warrants to Alpha Capital for the purchase of 78,019 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $0.01 per share (which were subsequently exercised in July 2020), and 192,068 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $52.50 per share. In August 2020, the Company issued noncompensatory equity classified warrants to Alpha Capital for the purchase of 128,783 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $60.00 per share. In December 2020, the Company issued noncompensatory equity classified warrants to Alpha Capital for the purchase of 100,000 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $0.10 per share (which were exercised in February 2021) and 219,101 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $40.70 per share. In May 2022, the Company issued noncompensatory equity classified warrants to Alpha Capital for the purchase of 331,464 reverse split adjusted shares of Company common stock at a reverse split adjusted exercise price of $0.01 per share.

On November 29, 2021, with the exception of the warrants to purchase 27,048 reverse split adjusted shares of the Company’s common stock at a reverse split adjusted exercise price of $11.10 per share, the exercise prices of all outstanding warrants to purchase a total of 539,951 reverse split adjusted shares of the Company’s common stock were modified to a reverse split adjusted exercise price of $20.00 per share and each of their remaining terms extended by six months. The fair value of the modification cost of these warrant modifications of approximately $2.3 million was charged to additional paid-in capital and did not result in expense on the Company’s condensed consolidated statements of operations and comprehensive loss. In May 2022, pre-funded warrants to purchase 331,464 reverse split adjusted shares of the Company’s common stock at a reverse split adjusted exercise price of $0.01 per share with no expiration date were issued. These warrants were subsequently exercised during the period ended September 30, 2022.

In conjunction with the NanoSynex Acquisition, on April 25, 2022 the exercise price of 7,048 reverse split adjusted outstanding warrants with an exercise price of $11.10 per share was modified to a reverse split adjusted exercise price of $6.00. The increase in fair value of $2,533, using a Monte Carlo pricing model for the modification of these warrants, was charged to additional paid-in capital and did not result in expense on the Company’s condensed consolidated statements of operations and comprehensive loss. On May 26, 2022, the reverse split adjusted exercise price of these warrants was modified again to $5.136, and the increase in fair value of $696, using a Monte Carlo pricing model for the modification of these warrants, was included in consideration transferred in the NanoSynex Acquisition. On December 22, 2022, the exercise price of these warrants was modified again to $1.32. The increase in fair value of $891, using a Monte Carlo pricing model for the modification of those warrants, was charged to additional paid-in capital and did not result in expense on the Company’s condensed consolidated statements of operations and comprehensive loss.

No noncompensatory equity classified warrants were issued during the six months ended June 30, 2023.

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2023:

SCHEDULE OF WARRANT ACTIVITY

	Common Stock
	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		547,003		$	19.76	$1.32 - $20.00		0.33
Legacy Ritter warrants		—			—
Granted		—			—
Exercised		—			—
Expired		(455,685	)		20.00		20.00
Forfeited		—			—
Total outstanding – June 30, 2023		91,318		$	18.56			-
Exercisable		91,318		$	18.56	$1.32 — $20.00			0.58
Non-Exercisable		—		$	—	$	—		—

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2022:

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		554,914	$	20.10
Legacy Ritter warrants		—		—
Granted		331,464		0.01		0.01
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2022		886,378	$	12.60
Exercisable		886,378	$	12.60	$0.01 — $37.70			0.82
Non-Exercisable		—	$	—	$	—		—

NOTE 15 — RELATED PARTY TRANSACTIONS

Convertible Debt

Short-Term Debt

NanoSynex has four separate notes payable outstanding to Alpha Capital, issued between March 26, 2020 and September 2, 2021, aggregating to a total principal outstanding balance of $905,000, and aggregate accrued interest of $60,155 for a total outstanding balance of $965,155 as of June 30, 2023. The Notes all accrue interest at 2.62% per annum, accrued daily, and provide that the full amount of principal and interest under each Note shall be due immediately prior to a Liquidation Event (the Maturity Date) unless due earlier in accordance with the terms of the Notes. “Liquidation Event” means either (i) the merger or consolidation of NanoSynex into any other entity, other than one in control or under control of NanoSynex or NanoSynex’s majority shareholder; (ii) a transaction or series of transactions resulting in the transfer of all or substantially all of NanoSynex’s assets or issued and outstanding share capital (other than to a company under the control of NanoSynex or NanoSynex’s majority shareholders; or (iii) an underwritten public offering by NanoSynex of its ordinary shares. Notwithstanding the above, if NanoSynex receives subsequent debt, convertible debt, or equity funding with gross proceeds of USD $3,000,000 or more, then the unused portion of these Notes shall be due and payable upon the actual receipt of such funding (See Note 8 - Short-Term Debt - Related Party).

NanoSynex Acquisition

The Company acquired a 52.8% voting equity interest in NanoSynex on May 26, 2022 through: (1) the purchase of 2,232,861 shares Preferred A-1 Stock of NanoSynex from Alpha Capital (a related party) for 350,000 reverse split adjusted shares of the Company’s common stock and a prefunded warrant to purchase 331,464 reverse split adjusted shares of the Company’s common stock at a purchase price of $0.001 per share (these warrants were subsequently exercised on September 13, 2022), and (2) the purchase of 381,786 shares of Series B preferred stock of NanoSynex from NanoSynex in exchange for $600,000.

NOTE 16 — SUBSEQUENT EVENTS

QN-302 Phase 1 Study

Between July 5-13, 2023, pursuant to the Master Clinical Research Services Agreement with TD2, Master Services Agreement with Clinigen, and Master Laboratory Services Agreement with MLM (see Note 13 - Research and License Agreements), the Company entered into work orders with these vendors to provide clinical trial services for the conduct of the QN-302 Phase 1 study. The estimated project timeline was set to start in July 2023 and continue until July 2026. The total amount to be paid under these work orders is currently expected to be approximately $7.6 million over the term of the QN-302 Phase 1 study.

Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A.

On July 20, 2023, the Company entered into the Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc., which was the legal entity operating the Company’s FastPack™ diagnostics business. The Transaction closed on July 20, 2023. Following the consummation of the Transaction, Qualigen, Inc. became a wholly-owned subsidiary of Chembio.

The aggregate net purchase price paid to the Company for the Shares was $5.2 million in cash, based on a base purchase price of $5.8 million, subject to certain post-closing adjustments, upward or downward, as applicable, for: (i) cash held by Qualigen, Inc. as of the closing of the Transaction; (ii) net working capital of Qualigen, Inc. as of the closing of the Transaction, (iii) certain indebtedness of Qualigen, Inc. as of the closing of the Transaction, and (iv) certain Transaction expenses as of the closing of the Transaction. Of the $5.2 million in cash, $450,000 is being held in escrow to satisfy certain Company indemnification obligations. Any amounts remaining in the Indemnity Escrow that have not been offset or reserved for claims will be released to the Company within five business days following the date that is 18 months after the closing.

Amendment and Settlement Agreement with NanoSynex Ltd.

On July 20, 2023, the Company entered into the NanoSynex Amendment, which amended the NanoSynex Funding Agreement with NanoSynex, to, among other things, provide for the further funding of NanoSynex, as contemplated by the NanoSynex Funding Agreement.

The NanoSynex Amendment supersedes any payments contemplated by the Original NanoSynex Agreement, such that except as described in the NanoSynex Amendment, the Company will have no further payment obligations to NanoSynex under the Original NanoSynex Agreement or otherwise (including by way of equity investment, loan financing or credit lines), and NanoSynex will have no further payment obligations to the Company for advances previously received under the Original NanoSynex Agreement.

Stockholder Approval of Alpha Stock Issuance Proposal

On July 13, 2023, the Company held its 2023 annual meeting of stockholders, at which the issuance to Alpha Capital of common stock pursuant to the terms and conditions of (a) the Debenture and (b) the Alpha Warrant were approved in accordance with Nasdaq Listing Rule 5635(d), which requires stockholder approval prior to the issuance of more than 20% of the Company’s issued and outstanding common stock.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our interim unaudited condensed consolidated financial statements and related notes included in this Quarterly Report on Form 10-Q (this “Quarterly Report”) and the audited financial statements and notes thereto as of and for the twelve months ended December 31, 2022, which are contained in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on May 2, 2023, as amended by Amendment No. 1 filed with the SEC on July 7, 2023 ( the “2022 Annual Report.) As used in this Quarterly Report, unless the context suggests otherwise, “we,” “us,” “our,” or “Qualigen” refer to Qualigen Therapeutics, Inc. In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties and assumptions.

Cautionary Note Regarding Forward Looking Statements

This Quarterly Report contains forward-looking statements by the Company that involve risks and uncertainties and reflect the Company’s judgment as of the date of this Report. These statements generally relate to future events or the Company’s future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” or “continue” or the negative of these words or other similar terms or expressions that concern the Company’s expectations, strategy, plans or intentions. Such forward-looking statements may relate to, among other things, potential future development, testing and launch of products and product candidates. Actual events or results may differ from our expectations.

Some of the factors that we believe could cause actual results to differ from those anticipated or predicted include:

●

there can be no assurance that we will successfully develop any drugs or therapeutic devices;

●

there can be no assurance that preclinical or clinical development of our candidate drugs or therapeutic devices will be successful;

●

there can be no assurance that clinical trials will be approved to begin by or will actually begin by or will proceed as contemplated by any projected timeline;

●

there can be no assurance that clinical trials will complete enrollment as contemplated by any projected timeline;

●

there can be no assurance that future clinical trial data will be favorable or that such trials will confirm any improvements over other products or lack negative impacts;

●

there can be no assurance that any of our candidate drugs or therapeutic devices will receive the required regulatory approvals or that they will be commercially successful;

●

there can be no assurance that we will be able to procure or earn sufficient working capital to complete the development, testing and launch of our prospective candidate drugs therapeutic products;

●

there can be no assurance that patents will issue on our owned and in-licensed patent applications;

●

there can be no assurance that such patents, if any, and our current owned and in-licensed patents would prevent competition;

By their nature, forward-looking statements involve risks and uncertainties because they relate to events, competitive dynamics, and healthcare, regulatory and scientific developments and depend on the economic circumstances that may or may not occur in the future or may occur on longer or shorter timelines than anticipated. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Quarterly Report, we caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition and liquidity, and the development of the industry in which we operate may differ materially from the forward-looking statements contained in this Quarterly Report. In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate, are consistent in some future periods with the forward-looking statements contained in this Quarterly Report, they may not be predictive of results or developments in other future periods.

Future filings with the SEC, future press releases and future oral or written statements made by us or with our approval, which are not statements of historical fact, may also contain forward-looking statements. Because such statements include risks and uncertainties, many of which are beyond our control, actual results may differ materially from those expressed or implied by such forward-looking statements. The forward-looking statements speak only as of the date on which they are made, and we undertake no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they are made.

Overview

We are a diversified life sciences company focused on developing treatments for adult and pediatric cancers with potential for Orphan Drug designation.

Our cancer therapeutics pipeline includes QN-302, RAS and QN-247.

Our lead oncology therapeutics program, QN-302, is an investigational small molecule G4-selective transcription inhibitor with strong binding affinity to G4s prevalent in cancer cells. Such binding could, by stabilizing the G4s against DNA “unwinding,” help inhibit cancer cell proliferation. QN-302 is currently undergoing Good Laboratory Practice (GLP) toxicology studies.

Our Pan-RAS portfolio consists of a family of RAS oncogene protein-protein interaction inhibitor small molecules believed to inhibit or block mutated RAS genes’ proteins from binding to their effector proteins. Preventing this binding could stop tumor growth, especially in RAS-driven tumors such as pancreatic, colorectal and lung cancers.

Our investigational QN-247 compound binds nucleolin, a key multi-functional regulatory phosphoprotein that is overexpressed in cancer cells. Such binding could inhibit the cancer cells’ proliferation. The foundational aptamer of QN-247 is QN-165 (formerly referred to as AS1411), which the Company has deprioritized as a drug candidate for treating COVID-19 and other viral-based infectious diseases.

On November 23, 2022, we effected a 1-for-10, as determined by our board of directors, reverse stock split of our outstanding shares of common stock (the “Reverse Stock Split”). The Reverse Stock Split reduced our shares of outstanding common stock, stock options, and warrants to purchase shares of our common stock. Fractional shares of common stock that would have otherwise resulted from the Reverse Stock Split were rounded down to the nearest whole share and cash in lieu of fractional shares was paid to stockholders. All share and per share data for all periods presented in this section and the accompanying financial statements and related disclosures have been adjusted retrospectively to reflect the Reverse Stock Split. The number of authorized shares of common stock and the par value per share remains unchanged.

On May 26, 2022, we acquired 2,232,861 shares of Series A-1 Preferred Stock of NanoSynex Ltd. (“NanoSynex”) from Alpha Capital Anstalt (“Alpha Capital”) in exchange for 350,000 shares of our common stock and a prefunded warrant to purchase 331,464 shares of our common stock at an exercise price of $0.001 per share. These warrants were subsequently exercised on September 13, 2022. Concurrently with this transaction, we also purchased 381,786 shares of Series B preferred stock from NanoSynex for a total purchase price of $600,000. The transactions resulted in our acquiring a 52.8% interest in NanoSynex (the “NanoSynex Acquisition”). NanoSynex is a micro-biologics diagnostics company domiciled in Israel.

We do not expect to be profitable before products from our therapeutics pipeline are commercialized. To experience losses while therapeutic products are still under development is, of course, typical for biotechnology companies.

Recent Developments

FDA Clearance of IND Application for QN-302

On August 1, 2023, the Company announced that the U.S. Food and Drug Administration has cleared the Company’s investigational new drug (IND) application for QN-302, allowing us to commence our Phase 1 clinical trial for QN-302.

Sale of FastPack™ Diagnostics Business

On July 20, 2023, we sold all of the issued and outstanding shares of common stock of our wholly-owned subsidiary, Qualigen, Inc., which was the legal entity operating our FastPack™ diagnostics business, to Chembio Diagnostics, Inc. (“Chembio”), a wholly-owned subsidiary of Biosynex, S.A. (the “Transaction”). The aggregate net purchase price paid to us for the shares was $5.2 million in cash, based on a base purchase price of $5.8 million, subject to certain post-closing adjustments, upward or downward, as applicable. Of the $5.2 million, $450,000 is being held in escrow to satisfy certain indemnification obligations. Any amounts remaining in the Indemnity Escrow that have not been offset or reserved for claims will be released to us within five business days following the date that is 18 months after the closing. Following the consummation of the Transaction, Qualigen, Inc. became a wholly-owned subsidiary of Chembio.

Amendment and Settlement Agreement with NanoSynex Ltd.

On July 20, 2023, we entered into an Amendment and Settlement Agreement with Nanosynex (the “NanoSynex Amendment”), which amended the Master Funding Agreement for the Operational and Technology Funding of NanoSynex Ltd. (the “NanoSynex Funding Agreement”) with NanoSynex and our payment obligations to NanoSynex under such agreement. See “Contractual Obligations and Commitments” below.

Critical Accounting Policies and Estimates

Our condensed consolidated financial statements do not separate our diagnostics-related activities from our therapeutics-related activities. Although to date all of our reported revenue is diagnostics-related, our reported expenses represent the total of our diagnostics-related and therapeutics-related expenses.

This discussion and analysis is based on our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities in our condensed consolidated financial statements. On an ongoing basis, we evaluate our estimates and judgments, including those related to impairment of goodwill and other intangible assets, fair value of warrant liabilities, stock-based compensation, amortization and depreciation, inventory reserves, allowances for doubtful accounts and returns, and warranty costs. We base our estimates on historical experience, known trends and events and various other factors we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

While our significant accounting policies are more fully described in Note 1 - Organization And Summary Of Significant Accounting Policies And Estimates to our unaudited condensed consolidated financial statements appearing in “Item 1. Condensed Consolidated Financial Statements (Unaudited),” we believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating our financial condition and results of operations:

●

Convertible debt

●

Research and development

●

Revenue recognition

●

Allowance for doubtful accounts and returns

●

Inventory

●

Impairment of long-lived assets

●

Business combination

●

Goodwill

●

In Process R&D

●

Derivative financial instruments and warrant liabilities

●

Stock-based compensation

●

Income taxes

Warrant Liabilities

In 2004, Qualigen, Inc. issued Series C preferred stock warrants to investors and brokers in connection with a private placement. These warrants were subsequently extended and survived the May 2020 Ritter reverse recapitalization transaction and are now exercisable for Qualigen Therapeutics common stock. These warrants contain a provision that if we issue shares (except in certain defined scenarios) at a price below the warrants’ exercise price, the exercise price will be re-set to such new price and the number of shares underlying the warrants will be increased in the same proportion as the exercise price decrease. For accounting purposes, such warrants give rise to warrant liabilities. The operation of the “double-ratchet” provisions in these warrants in connection with the NanoSynex Acquisition and the convertible debenture financing transaction in December 2022 now allow the holders to exercise for a significantly higher number of shares than before. Accounting principles generally accepted in the United States of America (“U.S. GAAP”) require us to recognize the fair value of these warrants as warrant liabilities on our condensed consolidated balance sheets and to reflect period-to-period changes in the fair value of the warrant liabilities on our condensed consolidated Statements of Operations. The estimated fair value of these warrant liabilities was $0.1 million and $0.8 million at June 30, 2023 and December 31, 2022, respectively. There were 1,349,571 of these warrants outstanding at June 30, 2023 and December 31, 2022.

On December 22, 2022, as part of the convertible debenture financing, the Company issued to Alpha Capital a common stock warrant for 2,500,000 shares of common stock of the Company (the “Alpha Warrant”). The exercise price of the Alpha Warrant is $1.65. The Alpha Warrant may be exercised by Alpha Capital, in whole or in part, at any time on or after June 22, 2023 and before June 22, 2028. U.S. GAAP requires us to recognize the fair value of this warrant as a warrant liability on our condensed consolidated balance sheets and to reflect period-to-period changes in the fair value of the warrant liability on our condensed consolidated statements of operations. The estimated fair value of this warrant liability was $2.0 million and $2.8 million at June 30, 2023 and December 31, 2022, respectively.

Because the fair value of the above liability classified warrants will be determined each quarter on a “mark-to-market” basis, it could result in significant variability in our future quarterly and annual consolidated statement of operations and consolidated balance sheets based on changes in our public market common stock price. Pursuant to U.S. GAAP, a quarter-to-quarter increase in our stock price would result in an increase (possibly quite large) in the fair value of the warrant liabilities and a quarter-to-quarter decrease in our stock price would result in a decrease (possibly quite large) in the fair value of the warrant liabilities.

Results of Operations

Comparison of the Three Months Ended June 30, 2023 and 2022

The following table summarizes our results of operations for the three months ended June 30, 2023 and 2022:

	For the Three Months Ended June 30,
	2023			2022
REVENUES
Net product sales	$	1,627,031		$	1,430,534
Total revenues		1,627,031			1,430,534

EXPENSES
Cost of product sales		1,016,542			1,099,677
General and administrative		2,665,849			2,660,857
Research and development		1,326,544			1,506,227
Sales and marketing		169,223			305,103
Total expenses		5,178,158			5,571,864

LOSS FROM OPERATIONS		(3,551,127	)		(4,141,330	)

OTHER EXPENSE (INCOME), NET
Gain on change in fair value of warrant liabilities		(440,294	)		(14,800	)
Interest expense (income), net		377,416			(4,823	)
Loss on disposal of equipment held for lease		63,302			—
Other income, net		(5,680	)		376
Total other expense (income), net		(5,256	)		(19,247	)

LOSS BEFORE (BENEFIT) PROVISION FOR INCOME TAXES		(3,545,871	)		(4,122,082	)

(BENEFIT) PROVISION FOR INCOME TAXES		(38,182	)		5,438

NET LOSS		(3,507,689	)		(4,127,520	)

Net loss attributable to noncontrolling interest		(43,484	)		(4,116	)

Net loss attributable to Qualigen Therapeutics, Inc.	$	(3,464,205	)	$	(4,123,404	)

Other comprehensive loss, net of tax
Net loss	$	(3,507,689	)	$	(4,127,520	)
Foreign currency translation adjustment		(56,747	)		65,540
Other comprehensive loss		(3,564,436	)		(4,061,980	)
Comprehensive loss attributable to noncontrolling interest		(43,484	)		(4,116	)
Comprehensive loss attributable to Qualigen Therapeutics, Inc.	$	(3,520,952	)	$	(4,057,864	)

Revenues

Net product sales

Net product sales are primarily generated from sales of diagnostic tests. Net product sales during the three-month periods ended June 30, 2023 and 2022 were approximately $1.6 million and $1.4 million, respectively, representing an increase of approximately $0.2 million, or 14%. This increase was primarily due to growth in sales volumes and higher average unit selling prices.

Expenses

Cost of Product Sales

Cost of product sales decreased during the three months ended June 30, 2023, to $1.0 million, or 62% of net product sales, compared to approximately $1.1 million, or 77% of net product sales, during the three months ended June 30, 2022. This decrease of $0.1 million, and decrease as a percentage of sales was primarily due to a reduction in force implemented in January 2023.

General and Administrative Expenses

General and administrative expenses remained the same at $2.7 million, for the three months ended June 30, 2023 and 2022.

Research and Development Costs

Research and development costs include therapeutic and diagnostic research and product development costs. Research and development costs decreased from $1.5 million for the three months ended June 30, 2022 to $1.3 million for the three months ended June 30, 2023. Of the $1.3 million of research and development costs for the three months ended June 30, 2023, approximately $1.2 million (89%) was attributable to therapeutics and $0.2 million (11%) was attributable to diagnostics. Of the $1.5 million of research and development costs for the three months ended June 30, 2022, $1.1 million (73%) was attributable to therapeutics and $0.4 million (27%) was attributable to diagnostics.

The $0.1 million increase in therapeutics research and development costs during the three months ended June 30, 2023 compared to the three months ended June 30, 2022 was primarily due to an increase of $0.5 million in preclinical research costs for QN-302, offset by a decrease of $0.4 million in preclinical research costs for QN-247.

The $0.2 million decrease in diagnostics research and development costs during the three months ended June 30, 2023 compared to the three months ended June 30, 2022 was primarily due to a $0.2 million decrease in stock-based compensation expense and a $0.1 million decrease in payroll expenses related to FastPack due to the January 2023 reduction in force, offset by an increase of $0.1 million in research and development expenses for NanoSynex.

For the future, we expect our therapeutic research and development costs to be relatively lower in periods when we are focusing on preclinical activities and meaningfully higher in periods when we are provisioning for and conducting clinical trials, if any.

Sales and Marketing Expenses

Sales and marketing expenses were approximately $0.2 million for the three months ended June 30, 2023, a decrease of $0.1 million or 45%, from the three months ended June 30, 2022. This decrease was primarily due to reduced payroll expenses related to the January 2023 reduction in force.

Other Income (Expense), Net

Change in Fair Value of Warrant Liabilities

During three months ended June 30, 2023 we experienced a $0.4 million gain on change in fair value of warrant liabilities arising from our liability classified warrants described above. The estimated fair value of these warrants decreased to $2.1 million as of June 30, 2023 from $3.6 million as of December 31, 2022, primarily due to a reduction in our stock price and shorter remaining outstanding life of the warrants.

Because the fair value of the warrant liabilities will be determined each quarter on a “mark-to-market” basis, this item is likely to continue to result in significant variability in our future quarterly and annual consolidated statements of operations based on unpredictable changes in our public market common stock price and the number of warrants outstanding at the end of each quarter.

Interest Expense (Income), Net

Interest expense, net during the three months ended June 30, 2023 was approximately $377,000 due to accrued interest on the convertible debt, as compared to interest income, net of approximately $5,000 during the three months ended June 30, 2022.

Loss on Disposal of Equipment Held for Lease

Loss on disposal of equipment held for lease during the three months ended June 30, 2023 was $63,000, compared to $0 during the three months ended June 30, 2022. This increase of $63,000 was due to a write off of discontinued FastPack analyzers that were acquired from Sekisui.

Other Income, Net

Other income was immaterial during the three months ended June 30, 2023 and 2022.

Comparison of the Six Months Ended June 30, 2023 and 2022

The following table summarizes our results of operations for the six months ended June 30, 2023 and 2022:

	For the Six Months Ended June 30,
	2023			2022
REVENUES
Net product sales	$	3,234,201		$	2,152,563
Total revenues		3,234,201			2,152,563

EXPENSES
Cost of product sales		2,281,368			1,928,524
General and administrative		4,380,283			5,559,608
Research and development		3,448,095			3,370,972
Sales and marketing		368,337			443,426
Total expenses		10,478,083			11,302,530

LOSS FROM OPERATIONS		(7,243,882	)		(9,149,967	)

OTHER EXPENSE (INCOME), NET
Gain on change in fair value of warrant liabilities		(1,478,967	)		(698,042	)
Interest expense (income), net		921,652			(11,132	)
Loss on voluntary conversion of convertible debt		1,077,287			—
Loss on disposal of equipment held for lease		63,302			—
Other income, net		(10,559	)		341
Loss on fixed asset disposal		300			—
Total other expense (income), net		573,015			(708,833	)

LOSS BEFORE (BENEFIT) PROVISION FOR INCOME TAXES		(7,816,897	)		(8,441,134	)

(BENEFIT) PROVISION FOR INCOME TAXES		(201,959	)		6,173

NET LOSS		(7,614,938	)		(8,447,307	)

Net loss attributable to noncontrolling interest		(304,512	)		(4,116	)

Net loss attributable to Qualigen Therapeutics, Inc.	$	(7,310,426	)	$	(8,443,191	)

Other comprehensive loss, net of tax
Net loss	$	(7,614,938	)	$	(8,447,307	)
Foreign currency translation adjustment		119,473			65,540
Other comprehensive loss		(7,495,465	)		(8,381,767	)
Comprehensive loss attributable to noncontrolling interest		(304,512	)		(4,116	)
Comprehensive loss attributable to Qualigen Therapeutics, Inc.	$	(7,190,953	)	$	(8,377,651	)

Revenues

Net product sales

Net product sales are primarily generated from sales of diagnostic tests. Net product sales during the six-month periods ended June 30, 2023 and 2022 were approximately $3.2 million and $2.2 million, respectively, representing an increase of approximately $1.0 million, or 50%. This increase was primarily due to the expiration of the Sekisui Distribution Agreement on March 31, 2022, at which time the distribution services previously provided by Sekisui reverted to us, which resulted in our recognizing 100% of the revenue from sales of our FastPack diagnostic test kits and instruments beginning in the second quarter of 2022.

Expenses

Cost of Product Sales

Cost of product sales increased during the six months ended June 30, 2023 to $2.3 million, or 71% of net product sales, compared to approximately $1.9 million, or 90% of net product sales, during the six months ended June 30, 2022. This increase of $0.4 million, and decrease as a percentage of sales was relative to the increase in sales volumes and higher average unit selling prices due to the termination of the Sekisui agreement on March 31, 2022 as well as a reduction in force implemented in January 2023.

General and Administrative Expenses

General and administrative expenses decreased from $5.6 million, during the six months ended June 30, 2022 to approximately $4.4 million during the six months ended June 30, 2023, a decrease of $1.2 million or 21%. This decrease was primarily due to a $1.5 million decrease in stock-based compensation expense due to the January 2023 reduction in force, partially offset by an increase in accounting fees of $0.3 million.

Research and Development Costs

Research and development costs include therapeutic and diagnostic research and product development costs. Research and development costs remained approximately the same at $3.4 million for the six months ended June 30, 2023 compared to the six months ended June 30, 2022. Of the $3.4 million of research and development costs for the six months ended June 30, 2023, $2.4 million (71%) was attributable to therapeutics and $1.0 million (29%) was attributable to diagnostics. Of the $3.4 million of research and development costs for the six months ended June 30, 2022, $2.7 million (80%) was attributable to therapeutics and $0.7 million (20%) was attributable to diagnostics.

The $0.3 million decrease in therapeutics research and development costs during the six months ended June 30, 2023 compared to the six months ended June 30, 2022 was primarily due to a decrease of $0.9 million of preclinical research costs for our QN-247 program, a decrease of $0.1 million in RAS preclinical research costs, a $0.2 million decrease in payroll-related expenses, and a $0.1 million decrease in preclinical research costs for QN-165, offset by an increase of $1.0 million in preclinical research costs for QN-302.

The $0.3 million increase in diagnostics research and developments costs during the six months ended June 30, 2023 compared to the six months ended June 30, 2022 was due to an increase of $0.8 million in research and development expenses for NanoSynex, offset by a reduction of offset by a reduction of $0.5 million in FastPack research and development expenses due to the January 2023 reduction in force.

Sales and Marketing Expenses

Sales and marketing expenses were approximately $0.4 million for the six months ended June 30, 2023, a decrease of $0.1 million or 17% from the six months ended June 30, 2022. This decrease was primarily due to lower payroll costs as a result of the January 2023 reduction in force.

Other Income (Expense), Net

Change in Fair Value of Warrant Liabilities

During six months ended June 30, 2023 we experienced a $1.5 million gain on change in fair value of warrant liabilities arising from our liability classified warrants described above. The estimated fair value of these warrants decreased to $2.1 million as of June 30, 2023 from $3.6 million as of December 31, 2022, primarily due to a reduction in our stock price and shorter remaining outstanding life of the warrants.

Because the fair value of the warrant liabilities will be determined each quarter on a “mark-to-market” basis, this item is likely to continue to result in significant variability in our future quarterly and annual statements of operations based on unpredictable changes in our public market common stock price and the number of liability classified warrants outstanding at the end of each quarter.

Interest Expense (Income), Net

Interest expense, net during the six months ended June 30, 2023 was approximately $921,000 due to accrued interest on the convertible debt, as compared to interest income, net of approximately $11,000 during the six months ended June 30, 2022.

Loss on Voluntary Conversion of Convertible Debt

During the six months ended June 30, 2023, we recognized a $1.1 million loss due to a voluntary conversion by Alpha Capital of approximately $1.1 million of convertible debt into 841,726 shares of common stock (see Note 10 - Convertible Debt - Related Party to our condensed consolidated financial statements). We did not have any outstanding convertible debt for the six months ended June 30, 2022.

Loss on Disposal of Equipment Held for Lease

Loss on disposal of equipment held for lease during the six months ended June 30, 2023, was $63,000, compared to $0 during the six months ended June 30, 2022. This increase of $63,000 was due to a write off of discontinued FastPack analyzers that were acquired from Sekisui.

Other Income, Net

Other income was immaterial during the six months ended June 30, 2023 and 2022.

Liquidity and Capital Resources

As of June 30, 2023, we had approximately $1.3 million in cash and an accumulated deficit of $110.7 million. For the six months ended June 30, 2023 and the year ended December 31, 2022, we used cash of $5.6 million and $13.2 million, respectively, in operations.

On July 25, 2023, we received a cash payment of $4.7 million from Chembio for all of the outstanding shares of common stock of Qualigen, Inc., which payment is subject to post-closing adjustments, upward or downward, as applicable, for: (i) cash held by the Subsidiary as of the closing of the Transaction; (ii) net working capital of the Subsidiary as of the closing of the Transaction, (iii) certain indebtedness of the Subsidiary as of the closing of the Transaction, and (iv) certain Transaction expenses as of the closing of the Transaction. An additional $450,000 is being held in an escrow account to satisfy certain indemnification obligations. Any amounts remaining in the Indemnity Escrow that have not been offset or reserved for claims will be released to us within five business days following the date that is 18 months after the closing of the Transaction.

On July 20, 2023, we entered into the NanoSynex Amendment with NanoSynex, which amended the NanoSynex Funding Agreement. See “Contractual Obligations and Commitments” below.

The Company’s cash balances as of the date that the accompanying financial statements were issued along with the proceeds from the above sale to Chembio, without additional financing, are expected to fund operations into the first quarter of 2024. The Company expects to continue to have net losses and negative cash flow from operations, which over time will challenge its liquidity. These factors raise substantial doubt about the Company’s ability to continue as a going concern for the one-year period following the date that these financial statements were issued.

There is no assurance that profitable operations will ever be achieved, or, if achieved, could be sustained on a continuing basis. In order to fully execute our business plan, we will require significant additional funding for planned research and development activities, capital expenditures, clinical testing for our QN-302 clinical trials, preclinical development of RAS and QN-247, as well as commercialization activities.

Historically, our principal sources of cash have included proceeds from the issuance of common and preferred equity and proceeds from the issuance of debt. In December 2022 we raised $3.0 million from the sale of a convertible debt instrument (see Note 10-Convertible Debt - Related Party to our unaudited condensed consolidated financial statements). There can be no assurance that further financing will be obtained on favorable terms, or at all. If we are unable to obtain funding, we could be required to delay, reduce or eliminate research and development programs, product portfolio expansion or future commercialization efforts, which could adversely affect our business prospects.

The accompanying financial statements have been prepared assuming that we will continue as a going concern. The financial statements do not include any adjustments that would be necessary should we be unable to continue as a going concern, and therefore, be required to liquidate our assets and discharge our liabilities in other than the normal course of business and at amounts that may differ from those reflected in the accompanying financial statements.

Our condensed consolidated balance sheet at June 30, 2023 includes $2.1 million of warrant liabilities. We do not consider the warrant liabilities to constrain our liquidity, as a practical matter. Our current liabilities at June 30, 2023 include $1.8 million of accounts payable, $2.0 million of accrued expenses and other current liabilities, a $0.2 million R&D grant liability, $0.3 million of accrued vacation, $1.8 million in short term debt and convertible debt to a related party.

Contractual Obligations and Commitments

We have no material contractual obligations that are not fully recorded on our condensed consolidated balance sheets or fully disclosed in the notes to the unaudited condensed consolidated financial statements.

Lease Agreement with Bond Ranch LP

On December 15, 2021, our wholly-owned subsidiary Qualigen, Inc. entered into a Second Amendment to Lease with Bond Ranch LP. This Amendment extended our triple-net leasehold on our existing 22,624-square-foot headquarters/manufacturing facility at 2042 Corte del Nogal, Carlsbad, California for the 61-month period of November 1, 2022 to November 30, 2027. Over the 61 months, the base rent payable will total $1,950,710; however, the base rent for the first 12 months of the 61-month period will be only $335,966. Additionally, Qualigen, Inc. was entitled to a $339,360 tenant improvement allowance. On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. The lease commitments described above transferred to Chembio upon the closing of this transaction. See Note 12 - Commitments and Contingencies and Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A. to our unaudited condensed consolidated financial statements for additional details.

License and Sponsored Research Agreements

We have obligations under various license and sponsored research agreements to make future payments to third parties that become due and payable on the achievement of certain development, regulatory and commercial milestones (such as the start of a clinical trial, filing for product approval with the FDA or other regulatory agencies, product approval by the FDA or other regulatory agencies, product launch or product sales) or on the sublicense of our rights to another party. We have not included these commitments on our balance sheet because the achievement and timing of these events is not determinable. Certain milestones are in advance of receipt of revenue from the sale of products and, therefore, we may require additional debt or equity capital to make such payments.

We have multiple license and sponsored research agreements with ULRF. Under these agreements, we have taken over development, regulatory approval and commercialization of various drug compounds from ULRF and are responsible for maintenance of the related intellectual property portfolio. For example, we agreed to reimburse ULRF for sponsored research expenses of up to $2.7 million and prior patent costs of up to $112,000 for RAS. As of June 30, 2023, there was approximately $239,000 remaining due to ULRF under this sponsored research agreement for RAS. We also agreed to reimburse ULRF for sponsored research expenses of up to $830,000 and prior patent costs of up to $200,000 for QN-247. As of June 30, 2023, there were no remaining un-expensed amounts due to ULRF under this sponsored research agreement for QN-247 and the agreement was terminated effective August 31, 2022. Under the terms of these agreements, we are required to make patent maintenance payments and payments based upon development, regulatory and commercial milestones for any products covered by the in-licensed intellectual property. The maximum aggregate milestone payments we may be obligated to make per product are $5 million. We will also be required to pay a royalty on net sales of products covered by the in-licensed intellectual property in the low single digits. The royalty is subject to reduction for any third-party payments required to be made, with a minimum floor in the low single digits. We have the right to sublicense our rights under these agreements, and we will be required to pay a percentage of any sublicense income.

On January 13, 2022, we entered into a License Agreement with UCL Business Limited to obtain an exclusive worldwide in-license of a genomic quadruplex (G4)-selective transcription inhibitor drug development program which had been developed at University College London, including lead and back-up compounds, preclinical data and a patent estate. (UCL Business Limited is the commercialization company for University College London.) The program’s lead compound is being developed by us under the name QN-302 as a candidate for treatment of pancreatic ductal adenocarcinoma (PDAC), which represents the vast majority of pancreatic cancers. The Agreement requires (if and when applicable) tiered royalty payments in the low to mid-single digits, clinical/regulatory/sales milestone payments, and a percentage of any non-royalty sublicensing consideration paid to the Company.

Technology Transfer Agreement with Yi Xin

Through our wholly-owned diagnostics subsidiary Qualigen, Inc., we entered into a Technology Transfer Agreement, dated as of October 7, 2020, with Yi Xin of Suzhou, China, which authorizes Yi Xin to develop, manufacture and sell new generations of diagnostic test systems based on our core FastPack technology. In addition, the Technology Transfer Agreement authorizes Yi Xin to manufacture and sell our current generations of FastPack System diagnostic products (1.0, IP and PRO) in China. We have provided technology transfer and patent/know-how license rights to facilitate Yi Xin’s development and commercialization.

Under the terms of the Technology Transfer Agreement, we have provided Yi Xin the exclusive rights for China, which is a market we have not otherwise entered, both for Yi Xin’s new generations of FastPack-based products and for Yi Xin-manufactured versions of our existing FastPack product lines. Yi Xin has the right to sell its new generations of FastPack-based diagnostic test systems throughout the world (but not to or toward current customers of our existing generations of FastPack products); provided that any non-China sales would, until March 31, 2022, need to be through Sekisui. As of April 1, 2022, Yi Xin has right to sell Yi Xin-manufactured versions of existing FastPack 1.0, IP and PRO product lines worldwide (other than in the United States and other than to or toward current non-US customers of those products). Yi Xin also has the right, as of April 1, 2022, to buy Qualigen-manufactured FastPack 1.0, IP and PRO products from us at distributor prices for resale in and for the United States (but not to or toward current U.S. customers of those products). We did not license Yi Xin to sell in the United States market any Yi Xin-manufactured versions of those legacy FastPack product lines, even after March 31, 2022. We agreed in the Technology Transfer Agreement that we would not, after March 31, 2022, seek new FastPack customers outside the United States, European Union, Canada, and Mexico.

Under the Technology Transfer Agreement, during the fiscal year ended December 31, 2021 we recognized revenues of approximately $670,000. There were no revenues under this agreement for the six months ended June 30, 2023, and the six months ended June 30, 2022. We will receive low- to mid-single-digit royalties on any future new-generations and current-generations product sales by Yi Xin.

Yi Xin is a newly-formed company and is subject to many risks. There can be no assurance that Yi Xin will successfully commercialize any products or that we will receive any royalties from Yi Xin.

On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. The Technology Transfer Agreement with Yi Xin described above transferred to Chembio upon the closing of this transaction. See Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A. to our unaudited condensed consolidated financial statements for additional details.

Alpha Convertible Debt

On December 22, 2022, we issued an 8% Senior Convertible Debenture in the aggregate principal amount of $3,300,000 (“the Debenture”) to Alpha Capital for a purchase price of $3,000,000 pursuant to the terms of a Securities Purchase Agreement, dated December 21, 2022. The Debenture is convertible, at any time, and from time to time, at Alpha Capital’s option, into shares of our common stock, at a price equal to $1.32 per share, subject to adjustment as described in the Debenture and other terms and conditions described in the Debenture, including the Company’s receipt of the necessary stockholder approvals, which were obtained at our 2023 annual meeting of stockholders.

In January 2023 Alpha Capital converted $1,111,078 of the Debenture principal into 841,726 shares of common stock at a conversion price of $1.32 per share.

Commencing June 1, 2023 and continuing on the first day of each month thereafter until the earlier of (i) December 22, 2025 and (ii) the full redemption of the Debenture (each such date, a “Monthly Redemption Date”), we must redeem $110,000 plus accrued but unpaid interest, liquidated damages and any amounts then owing under the Debenture (the “Monthly Redemption Amount”). The Monthly Redemption Amount must be paid in cash; provided that after the first two monthly redemptions, we may elect to pay all or a portion of a Monthly Redemption Amount in shares of common stock, based on a conversion price equal to the lesser of (i) the then applicable conversion price of the Debenture and (ii) 85% of the average of the VWAPs (as defined in the Debenture) for the five consecutive trading days ending on the trading day that is immediately prior to the applicable Monthly Redemption Date. We may also redeem some or all of the then outstanding principal amount of the Debenture at any time for cash in an amount equal to 105% of the then outstanding principal amount of the Debenture being redeemed plus accrued but unpaid interest, liquidated damages and any amounts then owing under the Debenture. Our election to pay monthly redemptions in shares of common stock or to effect an optional redemption is subject to the satisfaction of the Equity Conditions (as defined in the Debenture), including our receipt of the necessary stockholder approvals, which we obtained at our 2023 annual meeting of stockholders.

The Debenture accrues interest at the rate of 8% per annum, which does not begin accruing until December 1, 2023, and will be payable on a quarterly basis. Interest may be paid in cash or shares of common stock of the Company or a combination thereof at the option of the Company; provided that interest may only be paid in shares if the Equity Conditions have been satisfied, including our receipt of the necessary stockholder approvals, which we obtained at our 2023 annual meeting of stockholders.

During the three and six months ended June 30, 2023, we recognized an extinguishment loss on voluntary conversion of convertible debt of $0 and approximately $1.1 million, respectively, and recorded accrued interest of approximately $383,000 and $945,000, respectively (of which approximately $364,000 and $898,000 was a reduction to the discount, respectively) in other expenses in the condensed consolidated statements of operations. In June 2023 we paid the first Monthly Redemption Amount of $110,000 in cash, and as of June 30, 2023 the remaining Debenture principal balance was approximately $2.1 million, the remaining discount was approximately $1.3 million, the fair value of the Alpha Warrant was approximately $2.0 million, and the fair value of the suite of bifurcated embedded derivative features was $0.

NanoSynex Funding Agreement

As a condition to the NanoSynex Acquisition, we entered into the Funding Agreement with NanoSynex, pursuant to which we agreed to fund NanoSynex up to an aggregate of approximately $10.4 million over a three year period, subject to NanoSynex’s achievement of certain performance milestones specified in the NanoSynex Funding Agreement and the satisfaction of other terms and conditions described in the NanoSynex Funding Agreement.

These funding commitments were to be made in the form of convertible promissory notes to be issued to us with a face value equal to the amount paid by us to NanoSynex upon satisfaction of the applicable performance milestone, bearing interest at the rate of 9% per annum on the principal balance from time to time outstanding under the particular promissory note, convertible at our option into additional shares of NanoSynex in order for us to maintain at least a 50.1% controlling ownership interest in NanoSynex, should NanoSynex issue additional shares. During the year ended December 31, 2022, a total of approximately $2.4 million was funded to NanoSynex, and for the six months ended June 30, 2023 an additional $0.5 million was funded to NanoSynex under the Funding Agreement.

On July 20, 2023, we entered into the NanoSynex Amendment with NanoSynex, which amended the NanoSynex Funding Agreement and our payment obligations under such agreement. Pursuant to the terms of the Nanosynex Amendment, we will make an initial payment of $380,000 to NanoSynex by surrendering the Preferred B shares of NanoSynex held by us, resulting in our ownership in NanoSynex being reduced from approximately 52.8% to approximately 49.97% of the issued and outstanding voting equity of NanoSynex. In addition, we also agreed to (i) advance $560,000 to NanoSynex on or before November 30, 2023 (the “First Advance”), against which NanoSynex will issue a promissory note to us with a face value in the amount of such funding, and (ii) advance $670,000 to NanoSynex on or before March 31, 2024 (the “Second Advance,” and, together with the First Advance, the “New Advances”), against which NanoSynex will issue a promissory note to us with a face value in the amount of such funding. In addition, $2,880,000 in promissory notes delivered by NanoSynex to us for advances previously made by us to NanoSynex under the NanoSynex Funding Agreement were canceled.In the event we fail to make the New Advances, we have agreed to forfeit additional shares in a number that will be equal to a fraction, the numerator of which is the amount of the default (i.e., the amount that we should have, but failed, to advance to NanoSynex pursuant to the terms of the NanoSynex Amendment), and the denominator of which shall be the price per share that we originally paid in consideration for our Preferred A-1 shares of NanoSynex to the previous holder thereof, being $1.5716 per share.

The NanoSynex Amendment supersedes any payments contemplated by the NanoSynex Funding Agreement, such that except as described in the NanoSynex Amendment, we will have no further payment obligations to NanoSynex under the NanoSynex Funding Agreement or otherwise (including by way of equity investment, loan financing or credit lines), and NanoSynex will have no further payment obligations to us for advances previously received under the NanoSynex Funding Agreement.

Other Service Agreements

We enter into contracts in the normal course of business, including with clinical sites, contract research organizations, and other professional service providers for the conduct of clinical trials, contract manufacturers for the production of our product candidates, contract research service providers for preclinical research studies, professional consultants for expert advice and vendors for the sourcing of clinical and laboratory supplies and materials. These contracts generally provide for termination on notice, and therefore are cancelable contracts.

Cash Flows

The following table sets forth the significant sources and uses of cash for the periods set forth below:

	For the Six Months Ended
	June 30,
	2023			2022
Net cash (used in) provided by:
Operating activities	$	(5,562,416	)	$	(7,827,798	)
Investing activities		(246,418	)		71,871
Financing activities		—			3,859
Effect of exchange rate on cash		115,803			(34,228	)
Net decrease in cash and restricted cash	$	(5,693,031	)	$	(7,786,296	)

Net Cash Used in Operating Activities

During the six months ended June 30, 2023, operating activities used $5.6 million of cash, primarily resulting from a net loss of $7.6 million. Cash flows from operating activities (as opposed to net loss) for the six months ended June 30, 2023 were positively impacted by adjustments for a $1.1 million non cash loss on voluntary conversion of convertible debt, accretion of discount of $0.8 million on convertible debt, $0.9 million in stock-based compensation expense, a $0.9 million increase in accounts payable, a $0.4 million increase in accrued expenses and other current liabilities, a $0.4 million decrease in prepaid expenses and other assets, and depreciation and amortization of $0.2 million. Cash flows from operating activities (as opposed to net loss) for the six months ended June 30, 2023 were negatively impacted by adjustments for a $1.5 million decrease in fair value of warrant liabilities, a $0.2 million decrease in accounts receivable and inventory reserves and allowances, a $0.6 million decrease in R&D grant liability, a $0.2 million decrease in deferred tax liability, and a $0.1 million decrease in operating lease liability.

During the six months ended June 30, 2022, operating activities used $7.8 million of cash, primarily resulting from a net loss of $8.4 million. Cash flows from operating activities (as opposed to net loss) for the six months ended June 30, 2022 benefitted from $2.7 million in stock-based compensation expense, a $0.2 million decrease in net accounts receivable, and depreciation and amortization of $0.2 million. Cash flows from operating activities (as opposed to net loss) for the six months ended June 30, 2022 were negatively impacted by a $0.8 million decrease in accrued expenses and other current liabilities, a $0.6 million increase in prepaid expenses and other assets, $0.3 million increase in net inventory, a $0.7 million decrease in fair value of warrant liabilities and a $0.1 million decrease in operating lease liability.

Net Cash Provided by (Used in) Investing Activities

During the six months ended June 30, 2023, net cash used in investing activities was approximately $0.2 million, due to the purchase of property and equipment.

During the six months ended June 30, 2022, net cash provided by investing activities was approximately $0.1 million, primarily due to $0.7 million in cash acquired in the NanoSynex transaction, offset by the $0.6 million purchase of NanoSynex stock.

Net Cash Provided by Financing Activities

Net cash provided by financing activities for the six months ended June 30, 2023 was $0.

Net cash provided by financing activities for the six months ended June 30, 2022 was approximately $4,000, due to net proceeds from exercise of warrants.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and are not required to provide the information otherwise required under this Item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2023, the end of the period covered by this Quarterly Report.

Based on this evaluation, our principal executive officer and principal financial officer have concluded that, due to the material weakness described below, our disclosure controls and procedures as of June 30, 2023 were not effective to provide reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934, as amended (the “Exchange Act’), is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. We believe that a disclosure controls system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the disclosure controls system are met, and no evaluation of disclosure controls can provide absolute assurance that all disclosure control issues, if any, within a company have been detected.

Changes in Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act. Internal control over financial reporting is a process designed under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U.S. GAAP. As of December 31, 2022, our management assessed the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework, or 2013 Framework. Based on this assessment, our management concluded that, as of December 31, 2022, our internal control over financial reporting was not effective because of a material weakness in our internal control over financial reporting related to the lack of accounting department resources and/or policies and procedures to ensure recording and disclosure of items in compliance with generally accepted accounting principles. We have taken and continue to take steps to remediate the material weakness, including implementing additional procedures and utilizing external consulting resources with experience and expertise in U.S. GAAP and public company accounting and reporting requirements to assist management with its accounting and reporting of complex and/or non-recurring transactions and related disclosures.

Notwithstanding the identified material weakness, our management believes that the condensed consolidated financial statements included in this Quarterly Report fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with U.S. GAAP. Nonetheless, we also believe that an internal control system, no matter how well designed and operated, cannot provide absolute assurance that the objectives of the internal control system are met, and no evaluation of internal control can provide absolute assurance that all internal control issues and instances of fraud, if any, within a company are detected.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not currently involved in any legal matters. From time to time, we could become involved in disputes and various litigation matters that arise in the normal course of business. These may include disputes and lawsuits related to intellectual property, licensing, contract law and employee relations matters.

ITEM 1A. RISK FACTORS

The Company’s business, reputation, results of operations and financial condition, as well as the price of its stock, can be affected by a number of factors, whether currently known or unknown, including those described in Part I, Item 1A of the Company’s 2022 Annual Report under the heading “Risk Factors.” When any one or more of these risks materialize, the Company’s business, reputation, results of operations and financial condition, as well as the price of its stock, can be materially and adversely affected. Except as described below, there have been no material changes to the Company’s risk factors since the 2022 Annual Report.

We may be classified as a transient investment company.

We are not engaged in the business of investing, reinvesting, or trading in securities, and we do not hold ourselves out as being engaged in those activities. Under the Investment Company Act, however, a company may be deemed an investment company under Section 3(a)(1)(C) of the Investment Company Act if the value of its investment securities is more than 40% of its total assets (exclusive of government securities and cash items) on an unconsolidated basis.

We have recently divested certain shares of NanoSynex Ltd. (“NanoSynex”) which has resulted in our ownership in NanoSynex being reduced from approximately 52.8% to approximately 49.97% of the issued and outstanding voting equity of NanoSynex. Since we no longer hold a controlling interest in NanoSynex, the investment securities we hold, including our minority interest in NanoSynex, could exceed 40% of our total assets, exclusive of government securities cash items, on an unconsolidated basis, and, accordingly, we could determine that we have become a transient investment company.

A transient investment company can avoid being classified as an investment company if it can rely on one of the exclusions under the Investment Company Act. One such exclusion, Rule 3a-2 under the Investment Company Act, allows a transient investment company a grace period of one year from the earlier of (a) the date on which an issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis and (b) the date on which an issuer owns or proposes to acquire investment securities having a value exceeding 40% of the value of such issuer’s total assets (exclusive of government securities and cash items) on an unconsolidated basis. We are in the process of performing a valuation of our minority investment in Nanosynex to determine whether we need to invoke the grace period. We may take actions to cause the investment securities held by us to be less than 40% of our total assets, which may include acquiring assets with our cash on hand or liquidating our investment securities.

As Rule 3a-2 is available to a company no more than once every three years, and assuming no other exclusion were available to us, we would have to keep within the 40% limit for at least three years after we cease being a transient investment company. This may limit our ability to make certain investments or enter into joint ventures that could otherwise have a positive impact on our earnings. In any event, we do not intend to become an investment company engaged in the business of investing and trading securities.

Classification as an investment company under the Investment Company Act requires registration with the SEC. If an investment company fails to register, it would have to stop doing almost all business, and its contracts would become voidable. Registration is time consuming and restrictive and would require a restructuring of our operations, and we would be very constrained in the kind of business we could do as a registered investment company. Further, we would become subject to substantial regulation concerning management, operations, transactions with affiliated persons and portfolio composition, and would need to file reports under the Investment Company Act regime. The cost of such compliance would result in our incurring substantial additional expenses, and the failure to register if required would have a materially adverse impact to conduct our operations.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Unregistered Sales of Equity Securities

None

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

None

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable

ITEM 5. OTHER INFORMATION

None

ITEM 6. EXHIBITS

		Incorporated by Reference
Exhibit No.	Description	Form	File No.	Exhibit	Filing Date

2.1	Contingent Value Rights Agreement, dated May 22, 2020, among the Company, John Beck in the capacity of CVR Holders’ Representative and Andrew J. Ritter in his capacity as a consultant to the Company.	8-K	001-37428	2.4	5/29/2020

2.2	Stock Purchase Agreement, dated July 20, 2023, by and between Qualigen Therapeutics, Inc., Chembio Diagnostics, Inc., Biosynex, S.A., and Qualigen, Inc.	8-K	001-37428	2.1	7/26/2023

3.1	Amended and Restated Certificate of Incorporation	8-K	001-37428	3.1	7/1/2015

3.2	Certificate of Amendment to the Amended and Restated Certificate of Incorporation	8-K	001-37428	3.1	9/15/2017

3.3	Certificate of Amendment to the Amended and Restated Certificate of Incorporation	8-K	001-37428	3.1	3/22/2018

3.4	Certificate of Designation of Preferences, Rights and Limitations of Series Alpha Preferred Stock of the Company, filed with the Delaware Secretary of State on May 20, 2020	8-K	001-37428	3.1	5/29/2020

3.5	Certificate of Amendment to the Certificate of Incorporation of the Company, filed with the Delaware Secretary of State on May 22, 2020 [reverse stock split]	8-K	001-37428	3.2	5/29/2020

3.6	Certificate of Merger, filed with the Delaware Secretary of State on May 22, 2020	8-K	001-37428	3.3	5/29/2020

3.7	Certificate of Amendment to the Certificate of Incorporation of the Company, filed with the Delaware Secretary of State on May 22, 2020 [name change]	8-K	001-37428	3.4	5/29/2020

3.8	Amended and Restated Bylaws of the Company, through August 10, 2021	10-Q	001-37428	3.1	8/13/2021

3.9	Certificate of Amendment to the Amended and Restated Certificate of Incorporation, as amended	8-K	001-37428	3.1	11/22/2022

4.1	Warrant, issued by the Company in favor of Alpha Capital Anstalt, dated May 22, 2020	8-K	001-37428	10.13	5/29/2020

4.2	Form of Warrant, issued by the Company in favor of GreenBlock Capital LLC and its designees, dated May 22, 2020 [post-Merger]	8-K	001-37428	10.10	5/29/2020

4.3	Common Stock Purchase Warrant in favor of Alpha Capital Anstalt, dated July 10, 2020	8-K	001-37428	10.2	7/10/2020

4.4	Common Stock Purchase Warrant in favor of Alpha Capital Anstalt, dated August 4, 2020	8-K	001-37428	10.3	8/4/2020

4.5	“Two-Year” Common Stock Purchase Warrant for 1,348,314 shares in favor of Alpha Capital Anstalt, dated December 18, 2020	8-K	001-37428	10.3	12/18/2020

4.6	“Deferred” Common Stock Purchase Warrant for 842,696 shares in favor of Alpha Capital Anstalt, dated December 18, 2020	8-K	001-37428	10.4	12/18/2020

4.7	Form of liability classified Warrant to Purchase Common Stock	10-K	001-37428	4.13	3/31/2021

4.8	Form of “service provider” compensatory equity classified Warrant	10-K	001-37428	4.14	3/31/2021

4.9	Description of Common Stock	10-K/A	001-37428	4.9	7/7/2023

4.10	Amended and Restated Common Stock Purchase Warrant to GreenBlock Capital LLC, dated April 25, 2022	10-Q	001-37428	4.15	5/13/2022

4.11	Amended and Restated Common Stock Purchase Warrant to Christopher Nelson, dated April 25, 2022	10-Q	001-37428	4.16	5/13/2022

4.12	Common Stock Purchase Warrant for 2,500,000 shares in favor of Alpha Capital Anstalt, dated December 22, 2022	8-K	001-37428	4.1	12/22/2022

10.1*	Separation Agreement and General Release, dated June 20, 2023, by and between Qualigen Therapeutics, Inc. and Amy Broidrick

10.2	Amendment and Settlement Agreement, dated July 20, 2023, by and between Qualigen Therapeutics, Inc. and NanoSynex Ltd.	8-K	001-37428	10.1	7/26/2023

31.1	Certificate of principal executive officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2	Certificate of principal financial officer pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1	Certificate of principal executive officer and principal financial officer pursuant to 18 U.S.C. § 1350, as adopted 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 (embedded within the Inline XBRL document)

* Filed or furnished herewith.

+ Indicates management contract or compensatory plan or arrangement.

# XBRL (Extensible Business Reporting Language) information is furnished and not filed herewith, is not a part of a registration statement or Prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of the Securities 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.

August 14, 2023	QUALIGEN THERAPEUTICS, INC.

	By:	/s/ Michael S. Poirier
	Name:	Michael S. Poirier
	Title:	Chief Executive Officer

Exhibit 10.1

SEPARATION AGREEMENT AND GENERAL RELEASE

Purpose of Agreement: The intent of this Separation Agreement and General Release (“Agreement”) is to amicably and finally resolve and compromise all issues and claims surrounding the employment of Amy Broidrick (“Employee”) with Qualigen, Inc. (“Employer”) and the termination thereof. This Agreement becomes effective on the eighth day after it is executed by Employee (“Effective Date”).

Termination of Employment and Receipt of Compensation and Benefits: Employee’s employment with Employer is terminated on June 16, 2023 (“Termination Date”). Employee acknowledges that on the Termination Date Employee was paid for all unpaid salary and unused vacation time earned through the Termination Date. As of the Termination Date, Employee is no longer eligible to receive further compensation of any kind, including payments for wages, salary, vacation or benefits, and will not represent herself as an employee, officer, agent, or representative of Employer for any purpose. Employee will also no longer serve as a member of Employer’s Board of Directors, or as a member of the Board of Directors of any of Employer’s subsidiaries.

Employer’s Consideration for Agreement: In exchange for the release and agreements that Employee is making in this Agreement, Employer will provide Employee with the following:

Base Termination Payments: (A) The total gross amount of $16,636.79, less applicable withholdings for federal and state income and employment taxes, which represents an amount in cash equal to Employee’s accrued but unpaid salary and vacation pay through the Termination Date, and (B) Reimbursement of any expenses incurred by Employee under Section 4 of her Employment Agreement and in accordance with Employer’s expense reimbursement policies.

Base Terminations Payments will be made in a lump sum within 15 business days of the Effective Date of this Agreement.

Severance in the form of continued salary pay to Employee at the rate then in effect on the Termination Date for a period of 12 months following the Termination Date, subject to applicable withholdings and otherwise in accordance with Employer’s general payroll practices and policies.

Payment or reimbursement to Employee for the cost of COBRA continuation medical and dental insurance coverage for the Employee for a 12 month period following the Termination Date (less any required taxes or withholdings).

Any other rights or benefits, to the extent earned and vested as of the Termination Date, under Employer’s employee benefit plans such as Restricted Stock, Stock Bonus, Stock Appreciation Right, Restricted Stock Unit or Performance Awards (“Options”). Employee’s right to exercise her Options ends three (3) months from the Termination Date as described in Employee’s Stock Option Agreement (“Option Agreement”). No additional rights or benefits shall vest after the Termination Date

Employee’s Consideration for Agreement: Employee acknowledges and agrees but for Employee’s execution of this Agreement, Employee would not otherwise be entitled to the benefits described in Section 3. Employee represents and warrants that Employee has returned to Employer all items of property paid for and/or provided for Employee’s use during employment with Employer including, but not limited to, cameras, camera equipment, access badges, keys, books, manuals, laptop, peripherals, smartphone, corporate credit card, software, and company information and documents. Employee also warrants and represents that Employee has returned to Employer all documents (electronic or paper) created and received by Employee during employment with Employer, and that Employee has not retained any such documents, copies, summaries, or excerpts of such documents, except Employee may keep Employee’s personal copies of documents evidencing Employee’s hire, compensation and employee benefits and benefit plan participation, and this letter.

Release of Claims: Employee agrees that the benefits provided for in this Agreement represent settlement in full of all outstanding obligations owed to Employee by Employer and its officers, managers, supervisors, members, agents, and employees. Employee, on Employee’s own behalf, and on behalf of Employee’s heirs, representatives, executors, administrators, attorneys, family members, executors, agents, successors in interest, and assigns, hereby fully, knowingly and forever releases Employer and its past, present and future owners, parents, subsidiaries, divisions, affiliates, future affiliates, related entities, joint ventures, partners and members, including but not limited to Qualigen Therapeutics, Inc., as well as each of their respective past, present and future directors, officers, investors, shareholders, administrators, agents, associates, representatives, employees, attorneys, predecessors, successors and assigns, and any and all of them (the “Releasees”) from any and all liability, actions, causes of action, claims, charges, complaints, demands, grievances, promises, obligations, losses, damages, injuries and legal responsibilities, of any type whatsoever, whether known or unknown, unforeseen, unanticipated, unsuspected or latent, that are based upon, relate to or arise out of any matters of any kind (collectively, “Claims”), that Employee may possess arising from any omissions, acts or facts that have occurred up until and including the date of this Agreement including, without limitation:

Any and all claims for wrongful discharge, constructive discharge, or wrongful demotion;

Any and all claims relating to any contracts of employment, express or implied, or breach of the covenant of good faith and fair dealing, express or implied;

Any and all tort claims of any nature, including but not limited to claims for negligence, defamation, misrepresentation, fraud, or negligent or intentional infliction of emotional distress;

Any and all claims for wages, compensation, incentive equity or equity based awards, other benefits, and associated penalties and interest, including but not limited to claims under the state labor laws, state wage orders, and the federal Fair Labor Standards Act;

Any and all claims for retaliation or for discrimination or harassment based on sex, race, age, color, national origin, sexual orientation, gender identity and expression, religion, disability, marital status, veteran’s or military status, medical condition, or any other protected characteristic under federal, state or municipal statutes or ordinances; and any and all other employment-related claims whatsoever, including but not limited to claims under Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, 42 U.S.C. Section 1981, the Americans With Disabilities Act, the Employment Retirement Income Security Act, the Family and Medical Leave Act, the Equal Pay Act, the Fair Credit Reporting Act, the Age Discrimination in Employment Act of 1967, the Older Workers’ Benefit Protection Act, the Worker Adjustment and Retraining Notification (WARN) Act and any similar state laws, the Immigration Reform and Control Act, the Occupational Safety and Health Administration, the California Family Rights Act, the California Fair Employment and Housing Act, and the California Labor Code, the California Civil Code, the California Business & Professions Code, the Code of Federal Regulations, the California Code of Regulations, the California Unruh Act, the California Equal Pay Act, and any applicable California Industrial Welfare Commission Order, and any other federal, state, local, or foreign law (statutory, regulatory, or otherwise) that may be legally waived and released; and

Any and all claims for attorneys’ fees or costs.

This release is not intended to encompass claims for workers’ compensation, unemployment benefits, or COBRA rights. Nor is this release intended to prevent Employee from filing a statutory claim concerning employment with Employer or the termination thereof with the federal Equal Employment Opportunity Commission, the National Labor Relations Board, the California Civil Rights Department, or similar government agencies. However, if Employee does so, or if any such claim is prosecuted in Employee’s name before any court or administrative agency, Employee waives and agrees not to take any award of money or other damages from such suit (excepting only any monetary award to which Employee may become entitled pursuant to Section 922 of the Dodd-Frank Wall Street Reform and Consumer Protection Act).

Waiver of Unknown Claims; Civil Code Section 1542: This Agreement is a general release of claims and applies not only to known claims based on facts Employee is currently aware of but also to unknown claims based on facts Employee is not aware of. Employee hereby elects to assume all risks for claims that now exist in his or her favor, known or unknown, arising from the subject matter of this Agreement. Employee confirms that it is Employee’s intention in executing this Agreement to waive and relinquish all rights and benefits to all claims whether presently known or unknown, including any claims that Employee does not know or suspect to exist in his or her favor which, if known by him or her, would have materially affected Employee’s decision to enter into this Agreement.

Employee represents that Employee is not aware of any claim by Employee other than the claims that are released by this Agreement. Employee acknowledges that Employee has had the opportunity to be advised by legal counsel and is familiar with the provisions of California Civil Code Section 1542, which provides as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS THAT THE CREDITOR OR RELEASING PARTY DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE AND THAT, IF KNOWN BY HIM OR HER, WOULD HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR OR RELEASED PARTY.

Employee, being aware of said code section, agrees to expressly waive any rights Employee may have thereunder, as well as under any other statute or common law principles of similar effect.

Confidential Information: Employee agrees not to, except as authorized by Employer in writing, or as required by any law, rule, or regulation after providing prior written notice to Employer with sufficient time for Employer to object to production or disclosure, or to quash subpoenas related to the same, disclose to any other person, firm, company, or any other entity any confidential and proprietary information, knowledge, or data of Employer or that of third parties obtained by Employee during her employment with Employer. “Confidential and proprietary information” includes, but is not limited to, know-how, trade secrets, and technical, business and financial information and any other non-public information in any way learned by Employee during her employment with Employer, including, but not limited to (i) prices, renewal dates and other detailed terms of customer or supplier contracts and proposals; (ii) information concerning Employer’s customers, clients, referral sources and vendors, and potential customers, clients, referral sources and vendors, including, but not limited to, names of these entities or their employees or representatives, preferences, needs or requirements, purchasing or sales histories, or other customer or client-specific information; (iii) supplier and distributor lists; (iv) pricing policies, methods of delivering services and products, and marketing and sales plans or strategies; (v) products, product know-how, product technology and product development strategies and plans; (vi) employee personnel or payroll records or information (except as to Employee herself); (vii) forecasts, budgets and other non-public financial information; (viii) expansion plans, management policies and other business strategies; (ix) inventions, research, development, manufacturing, purchasing, finance processes, technologies, machines, computer software, computer hardware, automated systems, engineering, marketing, merchandising, and selling; and (x) any information whatsoever about the business and practices of Employer that was obtained by Employee during the course of her employment with Employer.

Confidentiality of Agreement: Employee agrees that the terms and conditions of this Agreement are strictly confidential. Employee shall not disclose, discuss or reveal the existence or the terms of this Agreement to any persons, entities or organizations except as follows: (a) as required by court order; (b) to Employee’s spouse; or (c) to Employee’s attorneys or accountants. Employee understands and agrees that all prior confidentiality agreements between Employee and Employer shall continue and will remain in full force and effect at all times after the Termination Date. Notwithstanding the foregoing, nothing in this Agreement prevents Employee from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that Employee has reason to believe is unlawful.

Further, Employee shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (A) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (B) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Further, in the event that Employee files a lawsuit for retaliation by Employer for reporting a suspected violation of law, Employee may disclose the trade secret to Employee’s attorney and use the trade secret information in the court proceeding, if Employee: (A) files any document containing the trade secret under seal; and (B) does not disclose the trade secret, except pursuant to court order.

Interpretation and Construction of Agreement: This Agreement shall in all respects be interpreted, enforced, and governed by and in accordance with the internal substantive laws (and not the laws of choice of laws) of the state of California. Regardless of which party initially drafted this Agreement, it shall not be construed against any one party, and shall be construed and enforced as a mutually prepared Agreement.

10.

No Admission of Liability: By entering into this Agreement, Employer is not admitting to any liability, wrongdoing or legal violation whatsoever with regard to the employment relationship between the parties or with respect to any claims released herein. Employer expressly denies any and all such liability and wrongdoing.

11.

Acknowledgement of Waiver of Claims Under ADEA; Waiting Period: Pursuant to the Age Discrimination in Employment Act of 1967 (the “ADEA”) and the Older Workers’ Benefit Protection Act, Employer hereby advises Employee to consult with an attorney prior to signing this Agreement. Employer also advises Employee that Employee has up to forty-five (45) days within which to consider whether Employee should sign this Agreement (and the parties agree that changes, whether material or immaterial, do not restart the running of this forty-five (45) day period). To the extent that Employee takes less than forty-five (45) days to consider this Agreement prior to execution, Employee acknowledges that Employee had sufficient time to consider this Agreement and that Employee expressly, voluntarily and knowingly waives any additional time. In addition, should Employee choose to sign the Agreement, Employee shall have seven (7) days following the date on which she signed the Agreement to revoke it, by delivering written notice of the revocation to Qualigen, Inc. Attn: Chris Lotz, 2042 Corte Del Nogal Ste. B, Carlsbad, CA 92011 (clotz@qualigeninc.com), for receipt within the seven-day period. This Agreement does not become effective until after this seven-day period has elapsed. Nothing in this Agreement prevents or precludes Employee from challenging or seeking a determination in good faith of the validity of this waiver under the ADEA, nor does it impose any condition precedent, penalties or costs from doing so, unless specifically authorized by federal law.

12.

Non-disparagement: Employee agrees that Employee will not, nor will cause or cooperate with others to, publicly criticize, ridicule, disparage or defame the Employer or its products, services, policies, directors, officers, managers, members, shareholders, or employees, or any other Releasees, with or through any written or oral statement or image, including, but not limited to, any statements made via websites, blogs, postings to the internet, or emails, whether or not they are made anonymously or through the use of a pseudonym. Employee agrees to provide full cooperation and assistance in assisting the Employer to investigate such statements if the Employer reasonably believes that the Employee is the source of the statements. The foregoing does not apply to statutorily privileged statements made to governmental or law enforcement agencies. Additionally, Employee agrees Employee shall not visit the office or facility locations, nor contact members of the Employer without prior written permission from/by the Chief Executive Officer or Employer’s authorized representative. Notwithstanding the foregoing, nothing in this Agreement prevents Employee from discussing or disclosing information about unlawful acts in the workplace, such as harassment or discrimination or any other conduct that Employee has reason to believe is unlawful.

13.

Complete and Voluntary Agreement: Employee acknowledges that Employee has read and understands this Agreement; that Employee has had the opportunity to seek legal counsel of Employee’s own choosing and to have the terms of the Agreement fully explained to Employee; that Employee is not executing this Agreement in reliance on any promises, representations or inducements other than those contained herein; and that Employee is executing this Agreement voluntarily, free of any duress or coercion. Employee specifically understands that by entering into this Agreement Employee is forever foreclosed from pursuing any of the claims Employee has waived in Section 5 above.

14.

Savings Clause: Should any of the provisions of this Agreement be determined to be invalid or unenforceable by a court or government agency of competent jurisdiction, it is agreed that such determination shall not affect the enforceability of the other provisions herein.

15.

Scope of Agreement: This Agreement constitutes the entire understanding of the parties on the subjects covered. Except as expressly provided herein, this Agreement supersedes and renders null and void any and all prior agreements between Employee and Employer.

16.

Waiver: The failure of Employer or Employee to insist upon strict adherence to any term of this Agreement on any occasion will not be considered a waiver thereof, or deprive that Party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement.

17.

Attorneys’ Fees and Costs: Employer and Employee agree that they will bear their own respective costs and fees, including attorneys’ fees, in connection with the negotiation and execution of this Agreement.

18.

Arbitration: The parties agree that any controversy involving the construction or application of any terms, covenants or conditions of this Agreement, or any claims arising out of or relating to this Agreement or the breach thereof will be submitted to and settled by final and binding arbitration before the American Arbitration Association (AAA) pursuant to its employment arbitration rules and procedures, in accordance with the Federal Arbitration Act, with the arbitration to take place in the state of California. Each side will bear its own attorneys’ fees in any such arbitration, and the arbitrator shall not have authority to award attorneys’ fees unless a statutory section at issue in the dispute authorizes the award of attorneys’ fees to the prevailing party, in which case the arbitrator has the authority to make such award as permitted by the statute in question. The parties agree that the prevailing party in any arbitration shall be entitled to injunctive relief in any court of competent jurisdiction to enforce the arbitration award. The parties hereby agree to waive their right to have any dispute between them resolved in a court of law by a judge or jury.

PLEASE READ CAREFULLY. THIS AGREEMENT CONTAINS A FULL RELEASE OF LEGAL CLAIMS, BOTH KNOWN CLAIMS AND UNKNOWN CLAIMS. EMPLOYEE ACKNOWLEDGES THAT HER SIGNATURE WILL NOT BE AFFIXED TO THIS AGREEMENT PRIOR TO HER TERMINATION DATE.

Dated: ___6/17/2023_________

______/s/ Amy Broidrick_____________ Employee Signature

______Amy Broidrick_______________ Employee Name (Printed)

Dated: ___6/20/2023_________

______/s/ Christopher Lotz____ Employer Representative Signature

Christopher Lotz

Employer Representative Signature (Printed)

Exhibit 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Michael S. Poirier, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Qualigen Therapeutics, Inc., a Delaware corporation;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

Based on my knowledge, the condensed consolidated financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant is made known to us by others within those entities, particularly during the period in which this report is being prepared;

Designed such control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of condensed consolidated financial statements for external purposes with generally accepted accounting principles;

Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 14, 2023	By:	/s/ Michael S. Poirier
	Name:	Michael S. Poirier
	Title:	Chief Executive Officer

Exhibit 31.2

CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Christopher L. Lotz, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Qualigen Therapeutics, Inc., a Delaware corporation;

2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 14, 2023	By:	/s/ Christopher L. Lotz
	Name:	Christopher L. Lotz
	Title:	Chief Financial Officer (Principal Financial Officer)

Exhibit 32.1

CERTIFICATIONS PURSUANT TO 18 U.S.C. SECTION 1350 AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

Each of the undersigned, Michael S. Poirier, Chief Executive Officer of Qualigen Therapeutics, Inc., a Delaware corporation (the “Company”), and Christopher L. Lotz, Chief Financial Officer of the Company, do hereby certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002, that, to his knowledge (1) the quarterly report on Form 10-Q of the Company for the three months ended June 30, 2023, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, and (2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 14, 2023

	By:	/s/ Michael S. Poirier
	Name:	Michael S. Poirier
	Title:	Chief Executive Officer (Principal Executive Officer)

August 14, 2023

	By:	/s/ Christopher L. Lotz
	Name:	Christopher L. Lotz
	Title:	Chief Financial Officer (Principal Financial Officer)

These certifications accompanying and being “furnished” with this Report, shall not be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to liability under that Section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Report, irrespective of any general incorporation language contained in such filing.

Cover - shares	6 Months Ended
Cover - shares	Jun. 30, 2023	Aug. 10, 2023
Cover [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Jun. 30, 2023
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Entity File Number	001-37428
Entity Registrant Name	Qualigen Therapeutics, Inc.
Entity Central Index Key	0001460702
Entity Tax Identification Number	26-3474527
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	2042 Corte Del Nogal
Entity Address, City or Town	Carlsbad
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	92011
City Area Code	(760)
Local Phone Number	918-9165
Title of 12(b) Security	Common Stock, par value $.001 per share
Trading Symbol	QLGN
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		5,052,463

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Current assets
Cash	$ 1,341,659	$ 7,034,434
Accounts receivable, net	679,380	538,587
Inventory, net	1,563,399	1,586,297
Prepaid expenses and other current assets	1,278,077	1,661,220
Total current assets	4,862,515	10,820,538
Restricted cash	5,434	5,690
Right-of-use assets	1,305,970	1,422,538
Property and equipment, net	498,647	345,087
Intangible assets, net	5,833,070	5,845,702
Goodwill	625,602	625,602
Other assets	18,334	18,334
Total Assets	13,149,572	19,083,491
Current liabilities
Accounts payable	1,756,183	857,311
Accrued vacation	332,617	467,948
Accrued expenses and other current liabilities	1,980,555	1,511,856
R&D grant liability	151,620	780,682
Deferred revenue, current portion	94,474	116,161
Operating lease liability, current portion	257,155	240,645
Short term debt-related party	965,155	950,722
Warrant liabilities	133,500	788,100
Warrant liabilities - related party	2,010,180	2,834,547
Convertible debt - related party	812,419	60,197
Total current liabilities	8,493,858	8,608,169
Operating lease liability, net of current portion	1,168,653	1,301,919
Deferred revenue, net of current portion	28,648	49,056
Deferred tax liability	150,369	357,757
Total liabilities	9,841,528	10,316,901
Commitments and Contingencies (Note 12)
Qualigen Therapeutics, Inc. stockholders’ equity:
Common stock, $0.001 par value; 225,000,000 shares authorized; 5,052,463 and 4,210,737 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively	42,952	42,110
Additional paid-in capital	112,554,830	110,528,050
Accumulated other comprehensive income	131,891	50,721
Accumulated deficit	(110,695,598)	(103,385,172)
Total Qualigen Therapeutics, Inc. stockholders’ equity	2,034,075	7,235,709
Noncontrolling interest	1,273,969	1,530,881
Total Stockholders’ Equity	3,308,044	8,766,590
Total Liabilities & Stockholders’ Equity	$ 13,149,572	$ 19,083,491

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	225,000,000	225,000,000
Common stock, shares issued	5,052,463	4,210,737
Common stock, shares outstanding	5,052,463	4,210,737

Condensed Consolidated Statements of Operations and Other Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
REVENUES
Total revenues	$ 1,627,031	$ 1,430,534	$ 3,234,201	$ 2,152,563
EXPENSES
Cost of product sales	1,016,542	1,099,677	2,281,368	1,928,524
General and administrative	2,665,849	2,660,857	4,380,283	5,559,608
Research and development	1,326,544	1,506,227	3,448,095	3,370,972
Sales and marketing	169,223	305,103	368,337	443,426
Total expenses	5,178,158	5,571,864	10,478,083	11,302,530
LOSS FROM OPERATIONS	(3,551,127)	(4,141,330)	(7,243,882)	(9,149,967)
OTHER EXPENSE (INCOME), NET
Gain on change in fair value of warrant liabilities	(440,294)	(14,800)	(1,478,967)	(698,042)
Interest expense (income), net	377,416	(4,824)	921,652	(11,132)
Loss on voluntary conversion of convertible debt			1,077,287
Loss on disposal of equipment held for lease	63,302		63,302
Other income, net	(5,680)	376	(10,559)	341
Loss on fixed asset disposal			300
Total other expense (income), net	(5,256)	(19,248)	573,015	(708,833)
LOSS BEFORE (BENEFIT) PROVISION FOR INCOME TAXES	(3,545,871)	(4,122,082)	(7,816,897)	(8,441,134)
(BENEFIT) PROVISION FOR INCOME TAXES	(38,182)	5,438	(201,959)	6,173
Net loss	(3,507,689)	(4,127,520)	(7,614,938)	(8,447,307)
Net loss attributable to noncontrolling interest	(43,484)	(4,116)	(304,512)	(4,116)
Net loss attributable to Qualigen Therapeutics, Inc.	$ (3,464,205)	$ (4,123,404)	$ (7,310,426)	$ (8,443,191)
Net loss per common share, basic	$ (0.69)	$ (1.12)	$ (1.46)	$ (2.35)
Net loss per common share, diluted	$ (0.69)	$ (1.12)	$ (1.46)	$ (2.35)
Weighted—average number of shares outstanding, basic	5,052,463	3,668,016	5,006,050	3,599,093
Weighted-average number of shares outstanding, diluted	5,052,463	3,668,016	5,006,050	3,599,093
Other comprehensive loss, net of tax
Foreign currency translation adjustment	$ (56,747)	$ 65,540	$ 119,473	$ 65,540
Other comprehensive loss	(3,564,436)	(4,061,980)	(7,495,465)	(8,381,767)
Comprehensive loss attributable to noncontrolling interest	(43,484)	(4,116)	(304,512)	(4,116)
Comprehensive loss attributable to Qualigen Therapeutics, Inc.	(3,520,952)	(4,057,864)	(7,190,953)	(8,377,651)
Net Product Sales [Member]
REVENUES
Total revenues	$ 1,627,031	$ 1,430,534	$ 3,234,201	$ 2,152,563

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($)	Common Stock [Member]	Additional Paid-in Capital [Member]	AOCI Attributable to Parent [Member]	Retained Earnings [Member]	Parent [Member]	Noncontrolling Interest [Member]	Total
Beginning balance, value at Dec. 31, 2021	$ 35,290	$ 101,274,073		$ (84,744,629)	$ 16,564,734		$ 16,564,734
Balance, shares at Dec. 31, 2021	3,529,018
Stock-based compensation		1,267,166			1,267,166		1,267,166
Net loss				(4,319,787)	(4,319,787)		(4,319,787)
Stock issued upon exercise of warrants	$ 5	4,711			4,716		4,716
Stock issued upon exercise of warrants, shares	536
Ending balance, value at Mar. 31, 2022	$ 35,295	102,545,950		(89,064,416)	13,516,829		13,516,829
Balance, shares at Mar. 31, 2022	3,529,554
Beginning balance, value at Dec. 31, 2021	$ 35,290	101,274,073		(84,744,629)	16,564,734		16,564,734
Balance, shares at Dec. 31, 2021	3,529,018
Net loss							(8,447,307)
Ending balance, value at Jun. 30, 2022	$ 38,795	107,557,744	65,540	(93,187,820)	14,474,259	3,995,884	18,470,143
Balance, shares at Jun. 30, 2022	3,879,554
Beginning balance, value at Mar. 31, 2022	$ 35,295	102,545,950		(89,064,416)	13,516,829		13,516,829
Balance, shares at Mar. 31, 2022	3,529,554
Stock-based compensation		1,423,282			1,423,282		1,423,282
Foreign currency translation adjustment			65,540		65,540		65,540
Net loss				(4,123,404)	(4,123,404)	(4,116)	(4,127,520)
Common stock issued for business acquisition	$ 3,500	1,841,000			1,844,500		1,844,500
Common stock issued shares for business acquisition	350,000
Prefunded warrants issued for business acquisition		1,746,816			1,746,816		1,746,816
Estimated fair value of noncontrolling interest related to business acquisition						4,000,000	4,000,000
Fair value of warrant modification for business acquisition		696			696		696
Ending balance, value at Jun. 30, 2022	$ 38,795	107,557,744	65,540	(93,187,820)	14,474,259	3,995,884	18,470,143
Balance, shares at Jun. 30, 2022	3,879,554
Beginning balance, value at Dec. 31, 2022	$ 42,110	110,528,050	50,721	(103,385,172)	7,235,709	1,530,881	8,766,590
Balance, shares at Dec. 31, 2022	4,210,737
Voluntary conversion of convertible debt into common stock	$ 842	1,111,740			1,112,582		1,112,582
Voluntary conversion of convertible debt into common stock, shares	841,726
Stock-based compensation		247,657			247,657	4,569	252,226
Foreign currency translation adjustment			119,723		119,723	56,497	176,220
Net loss				(3,846,221)	(3,846,221)	(261,028)	(4,107,249)
Ending balance, value at Mar. 31, 2023	$ 42,952	111,887,447	170,444	(107,231,393)	4,869,450	1,330,919	6,200,369
Balance, shares at Mar. 31, 2023	5,052,463
Beginning balance, value at Dec. 31, 2022	$ 42,110	110,528,050	50,721	(103,385,172)	7,235,709	1,530,881	8,766,590
Balance, shares at Dec. 31, 2022	4,210,737
Net loss							(7,614,938)
Ending balance, value at Jun. 30, 2023	$ 42,952	112,554,830	131,891	(110,695,598)	2,034,075	1,273,969	3,308,044
Balance, shares at Jun. 30, 2023	5,052,463
Beginning balance, value at Mar. 31, 2023	$ 42,952	111,887,447	170,444	(107,231,393)	4,869,450	1,330,919	6,200,369
Balance, shares at Mar. 31, 2023	5,052,463
Stock-based compensation		667,383			667,383	4,728	672,111
Foreign currency translation adjustment			(38,553)		(38,553)	(18,194)	(56,747)
Net loss				(3,464,205)	(3,464,205)	(43,484)	(3,507,689)
Ending balance, value at Jun. 30, 2023	$ 42,952	$ 112,554,830	$ 131,891	$ (110,695,598)	$ 2,034,075	$ 1,273,969	$ 3,308,044
Balance, shares at Jun. 30, 2023	5,052,463

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended				6 Months Ended		12 Months Ended
	Jun. 30, 2023	Mar. 31, 2023	Jun. 30, 2022	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (3,507,689)	$ (4,107,249)	$ (4,127,520)	$ (4,319,787)	$ (7,614,938)	$ (8,447,307)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization					122,523	66,258
Amortization of right-of-use assets					116,567	109,803
Accounts receivable reserves and allowances					(133,278)	(75,295)
Inventory reserves					(22,992)	(16,405)
Stock-based compensation					906,145	2,690,447
Change in fair value of warrant liabilities					(1,478,967)	(698,042)
Loss on voluntary conversion of convertible debt					1,077,287
Accretion of discount on convertible debt					787,517
Loss on disposal of fixed assets and equipment held for lease					63,602
Changes in operating assets and liabilities:
Accounts receivable					(8,614)	250,201
Inventory and equipment held for lease					(37,390)	(237,930)
Prepaid expenses and other assets					382,893	(548,487)
Accounts payable					899,753	27,941
Accrued expenses and other current liabilities					357,508	(828,229)
R&D grant liability					(613,793)
Operating lease liability					(116,756)	(73,408)
Deferred revenue					(42,095)	(47,345)
Deferred tax liability					(207,388)
Net cash used in operating activities					(5,562,416)	(7,827,798)	$ (13,200,000)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment					(246,418)	(63,483)
Net cash acquired in business combination						135,354
Net cash (used in)/provided by investing activities					(246,418)	71,871
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from warrant exercises						3,859
Net cash provided by financing activities						3,859
Net change in cash and restricted cash					(5,808,834)	(7,752,068)
Effect of exchange rate changes on cash and restricted cash					115,803	(34,228)
Cash and restricted cash - beginning of period		$ 7,040,124		$ 17,538,272	7,040,124	17,538,272	17,538,272
Cash and restricted cash - end of period	$ 1,347,093		$ 9,751,976		1,347,093	9,751,976	$ 7,040,124
Cash paid during the year for:
Interest
Taxes					6,293	3,501
NONCASH FINANCING AND INVESTING ACTIVITIES:
Net transfers to equipment held for lease from inventory					83,271
Fair value of warrant liabilities on date of exercise						858
Voluntary conversion of convertible debt into common stock					$ 1,112,582

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

6 Months Ended

Jun. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

NOTE 1 — ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES

Organization

Basis of Presentation

Principles of Consolidation

Accounting Estimates

Reverse Stock Split

Cash

Inventory, Net

Impairment of Long-Lived Assets

Segment Reporting

Accounts Receivable, Net

Accounts receivable, net is comprised of the following at:

SCHEDULE OF ACCOUNTS RECEIVABLE

	June 30, 2023			December 31, 2022
Accounts Receivable	$	733,964		$	726,449
Less Reserves and Allowances		(54,584	)		(187,862	)
Accounts receivable, net	$	679,380		$	538,587

Research and Development

Except for acquired in process research and development (IPR&D), the Company expenses research and development costs as incurred including therapeutics license costs.

R&D Grants

Patent Costs

Shipping and Handling Costs

Revenue from Contracts with Customers

Product Sales

Contract Asset and Liability Balances

Deferred Revenue

Operating Leases

Property and Equipment, Net

Machinery and equipment			5 years
Computer equipment			3 years
Molds and tooling			5 years
Furniture and fixtures			5 years

The Company’s policy is to evaluate the remaining lives and recoverability of long-term assets on at least an annual basis or when conditions are present that indicate impairment.

Business Combinations

Goodwill

Intangible Assets

In Process R&D

Other Intangible Assets, Net

Derivative Financial Instruments and Warrant Liabilities

Fair Value Measurements

	●	Level 1 - Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;
	●	Level 2 - Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly, including inputs in markets that are not considered to be active; and
	●	Level 3 - Inputs that are unobservable.

Fair Value of Financial Instruments

Comprehensive Loss

Stock-Based Compensation

Income Taxes

Sales and Excise Taxes

Warranty Costs

Foreign Currency Translation

War in Ukraine

Inflation and Global Economic Conditions

Impact of COVID-19 Pandemic

Other accounting standard updates are either not applicable to the Company or are not expected to have a material impact on the Company’s condensed consolidated financial statements.

LIQUIDITY

6 Months Ended

Jun. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

LIQUIDITY

NOTE 2 — LIQUIDITY

INVENTORY, NET

6 Months Ended

Jun. 30, 2023

Inventory Disclosure [Abstract]

INVENTORY, NET

NOTE 3— INVENTORY, NET

Inventory, net consisted of the following at June 30, 2023 and December 31, 2022:

SCHEDULE OF INVENTORY

	June 30, 2023		December 31, 2022
Raw materials	$	1,027,455	$	949,796
Work in process		177,591		200,318
Finished goods		358,353		436,183
Total inventory	$	1,563,399	$	1,586,297

PREPAID EXPENSES AND OTHER CURRENT ASSETS

6 Months Ended

Jun. 30, 2023

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

PREPAID EXPENSES AND OTHER CURRENT ASSETS

NOTE 4 — PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consisted of the following at June 30, 2023 and December 31, 2022:

	June 30, 2023		December 31, 2022
Prepaid insurance	$	938,106	$	1,377,323
Prepaid manufacturing expenses		51,710		43,820
Other prepaid expenses		65,288		227,451
Prepaid research and development expenses		211,337		—
Other current assets		11,636		12,626
	$	1,278,077	$	1,661,220

PROPERTY AND EQUIPMENT, NET

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

PROPERTY AND EQUIPMENT, NET

NOTE 5 — PROPERTY AND EQUIPMENT, NET

Property and equipment, net consisted of the following at June 30, 2023 and December 31, 2022:

SCHEDULE OF PROPERTY AND EQUIPMENT

	June 30, 2023			December 31, 2022
Machinery and equipment	$	2,735,507		$	2,510,148
Computer equipment		369,589			395,836
Leasehold improvements		336,916			333,271
Molds and tooling		260,002			260,002
Furniture and fixtures		144,832			144,832
Equipment held for lease		1,405,384			1,399,444
Property and equipment, gross		5,252,230			5,043,533
Accumulated depreciation		(4,678,583	)		(4,623,446	)
Fixed asset impairment		(75,000	)		(75,000	)
Property and equipment, net	$	498,647		$	345,087

GOODWILL, IPR&D AND OTHER INTANGIBLES

6 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL, IPR&D AND OTHER INTANGIBLES

NOTE 6 — GOODWILL, IPR&D AND OTHER INTANGIBLES

		June 30,			December 31,
		2023			2022
	Estimated Useful Lives	Gross carrying amounts			Gross carrying amounts

Goodwill		$	625,602		$	625,602

Finite-lived intangible assets:
Developed-product-technology rights	8 - 17 years	$	479,103		$	479,103
Licensing rights	10 years		418,836			418,836
Less: Accumulated amortization			(764,869	)		(752,237	)
Total finite-lived intangible assets, net			133,070			145,702
Indefinite-lived intangible assets:
In-process research and development			5,700,000			5,700,000
Total other intangible assets, net		$	5,833,070		$	5,845,702

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

6 Months Ended

Jun. 30, 2023

Payables and Accruals [Abstract]

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

NOTE 7 — ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following at June 30, 2023 and December 31, 2022:

	June 30, 2023		December 31, 2022
Board compensation	$	84,000		70,000
Equipment held for lease		—		154,433
Franchise, sales and use taxes		30,407		27,531
Income taxes		6,921		4,663
Interest (Convertible debt - related party)		50,101		2,829
License fees		100,026		150,130
Payroll		484,048		209,303
Professional fees		368,032		238,211
Research and development		523,490		322,987
Royalties		16,383		13,158
Warranty liability		140,370		137,568
Other		176,777		181,043
	$	1,980,555	$	1,511,856

SHORT TERM DEBT-RELATED PARTY

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

SHORT TERM DEBT-RELATED PARTY

NOTE 8 – SHORT TERM DEBT-RELATED PARTY

WARRANT LIABILITIES

6 Months Ended

Jun. 30, 2023

Warrant Liabilities

WARRANT LIABILITIES

NOTE 9 – WARRANT LIABILITIES

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2023:

SCHEDULE OF WARRANTS ACTIVITY

	Common Stock Warrants
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		3,849,571	$	1.53		$1.32 - $1.65		3.9
Exercised		—		—		—		—
Forfeited		—		—		—		—
Expired		—		—		—		—
Granted		—		—		—		—
Total outstanding – June 30, 2023		3,849,571	$	1.53		$1.32 - $1.65		3.41
Exercisable		3,849,571	$	1.53		$1.32 - $1.65		3.41

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2022:

	Common Stock Warrants
	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding –December 31, 2021		248,161		$	7.20				2.00
Exercised		(536	)		7.20
Forfeited		(247,625	)		7.20
Expired		—			—
Granted		346,896			5.10
Total outstanding – June 30, 2022		346,896		$	5.10
Exercisable		346,896		$	5.10	$	5.10		1.51

The following table presents the Company’s fair value hierarchy for its liabilities measured at fair value on a recurring basis as of June 30, 2023:

	Quoted
	Market		Significant
	Prices for		Other		Significant
	Identical		Observable		Unobservable
	Assets		Inputs		Inputs
Common Stock Warrant liabilities	(Level 1)		(Level 2)		(Level 3)			Total
Balance as of December 31, 2022	$	—	$	—	$	3,622,647		$	3,622,647
Exercises		—		—		—			—
Gain on change in fair value of warrant liabilities		—		—		(1,478,967	)		(1,478,967	)
Balance as of June 30, 2023	$	—	$	—	$	2,143,680		$	2,143,680

There were no transfers of financial assets or liabilities between category levels for the three and six months ended June 30, 2023.

	June 30, 2023						June 30, 2022
	Range			Weighted Average			Range			Weighted Average
Risk-free interest rate	4.05% — 5.31%				4.49	%	2.80% — 2.87%				2.82	%
Expected volatility (peer group)	66.3% — 134%				110.55	%	74% — 96%				78.6	%
Term of warrants (in years)	.39 — 4.98			3.41			1.39 — 1.99			1.51
Expected dividend yield		0.00	%		0.00	%		0.00	%		0.00	%

CONVERTIBLE DEBT- RELATED PARTY

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

CONVERTIBLE DEBT- RELATED PARTY

NOTE 10 — CONVERTIBLE DEBT- RELATED PARTY

The proceeds from the transaction are being used to advance the Company’s QN-302 Investigative New Drug candidate towards clinical trials and other working capital purposes.

Convertible debt-related party is comprised of the following as of June 30, 2023 and December 31, 2022:

	June 30, 2023			December 31, 2022
Senior secured convertible debenture	$	2,078,922		$	3,300,000
Discount on convertible debenture		(1,266,503	)		(3,239,803	)
Total convertible debt-related party	$	812,419		$	60,197

As of June 30, 2023, there were no events of default or violation of any covenants under our financing obligations.

EARNINGS (LOSS) PER SHARE

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

EARNINGS (LOSS) PER SHARE

NOTE 11 — EARNINGS (LOSS) PER SHARE

The following potentially dilutive securities have been excluded from diluted net loss per share as of June 30, 2023 and 2022 because their effect would be anti-dilutive:

	As of June 30,
	2023		2022
Shares of common stock subject to outstanding options		445,163		476,783
Shares of common stock subject to outstanding warrants		4,119,934		1,412,338
Total common stock equivalents		4,565,097		1,889,121

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jun. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

NOTE 12 — COMMITMENTS AND CONTINGENCIES

Leases

The tables below show the operating lease right-of-use assets and operating lease liabilities as of June 30, 2023, including the changes during the periods:

	Operating lease right-of-use assets
Net right-of-use assets at December 31, 2022	$	1,422,538
Less amortization of operating lease right-of-use assets		(116,568	)
Operating lease right-of-use assets at June 30, 2023	$	1,305,970

	Operating lease liabilities
Lease liabilities at December 31, 2022	$	1,542,564
Less principal payments on operating lease liabilities		(116,756	)
Lease liabilities at June 30, 2023		1,425,808
Less non-current portion		(1,168,653	)
Current portion at June 30, 2023	$	257,155

As of June 30, 2023, the Company’s operating leases have a weighted-average remaining lease term of 4.3 years and a weighted-average discount rate of 8.9%.

As of June 30, 2023, future minimum payments during the next five fiscal years and thereafter are as follows:

Year Ending December 31,	Amount
2023 (six months)		184,171
2024		379,392
2025		390,773
2026		402,497
2027		379,164
Total		1,735,997
Less present value discount		(310,189	)
Operating lease liabilities	$	1,425,808

On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. The lease commitments described above transferred to Chembio upon the closing of this transaction. (see Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A. ).

NanoSynex Funding Commitment

Litigation and Other Legal Proceedings

RESEARCH AND LICENSE AGREEMENTS

6 Months Ended

Jun. 30, 2023

Research And License Agreements

RESEARCH AND LICENSE AGREEMENTS

NOTE 13 — RESEARCH AND LICENSE AGREEMENTS

The University of Louisville Research Foundation

There were no sponsored research expenses or license costs related to these agreements for the three months ended June 30, 2023 and 2022, or for the six months ended June 30, 2023 and 2022.

Yi Xin

On July 20, 2023, the Company entered into a Purchase Agreement with Chembio, Biosynex, S.A. (“Biosynex”), and Qualigen, Inc., a wholly-owned subsidiary of the Company. Pursuant to the Purchase Agreement, the Company agreed to sell to Chembio all of the issued and outstanding shares of common stock of Qualigen, Inc. The Technology Transfer Agreement with Yi Xin described above transferred to Chembio upon the closing of this transaction. See Note 16 - Subsequent Events: Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A. to our unaudited condensed consolidated financial statements for additional details.

UCL Business Limited

Prediction Biosciences

QN-302 Phase 1 Study

STOCKHOLDERS’ EQUITY

6 Months Ended

Jun. 30, 2023

Equity [Abstract]

STOCKHOLDERS’ EQUITY

NOTE 14 — STOCKHOLDERS’ EQUITY

As of June 30, 2023 and December 31, 2022, the Company had two classes of authorized capital stock: common stock and preferred stock.

Common Stock

SCHEDULE OF RESERVED SHARES


Exercise of issued and future grants of stock options			445,163
Exercise of stock warrants			4,119,934
Total			4,565,097

Preferred Stock

At June 30, 2023 and December 31, 2022, there were no shares of preferred stock outstanding.

Stock Options and Warrants

Stock Options

The Company recognizes all compensatory share-based payments as compensation expense over the service period, which is generally the vesting period.

SCHEDULE OF STOCK OPTION ACTIVITY

	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		608,012		$	35.02		$5.14 - $51.30		8.09
Granted		—			—		—		—
Expired		—			—		—		—
Forfeited		(162,849	)		36.01		5.14 - 51.30		—
Total outstanding – June 30, 2023		445,163		$	34.68		$5.14 — $51.30		7.59
Exercisable (vested)		323,355		$	44.79		$5.14 — $51.30		7.13
Non-Exercisable (non-vested)		121,808		$	7.83		$5.14 - $35.20		8.85

	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		484,186		$	60.70	$12.40 — $14,657.50			8.52
Granted		2,500			10.50		10.50		9.54
Expired		(9,386	)		935.90		57.50 - 14,657.50		—
Forfeited		(517	)		35.10		12.40 - 49.70		—
Total outstanding – June 30, 2022		476,783		$	43.30		$10.50 — $51.30		8.19
Exercisable (vested)		264,366		$	48.40		$12.40 — $50.13		8.00
Non-Exercisable (non-vested)		212,417		$	36.80		$10.50 — $51.30		8.48

Fair Value of Equity Awards

The Company utilizes the Black-Scholes option pricing model to value awards under its equity plans. Key valuation assumptions include:

●	Expected dividend yield. The expected dividend is assumed to be zero, as the Company has never paid dividends and has no current plans to pay any dividends on the Company’s common stock.

●

●	Risk-free interest rate. The risk-free interest rate is based on the U.S. Treasury yield in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal to the expected term.

●

The material factors incorporated in the Black-Scholes model in estimating the fair value of the options granted for the periods presented were as follows:

	For the Six Months Ended June 30,
	2023			2022
Expected dividend yield		0.00	%		0.00	%
Expected stock-price volatility		—			102	%
Risk-free interest rate		—		1.58% — 1.67		%
Expected average term of options (in years)		—			6.00
Stock price	$	—		$	1.05

The Company recorded share-based compensation expense and classified it in the unaudited condensed consolidated statements of operations as follows:

	2023		2022
	For the Six Months Ended June 30,
	2023		2022
General and administrative	$	807,980	$	2,329,418
Research and development		98,165		361,029
Total	$	906,145	$	2,690,447

Equity Classified Compensatory Warrants

No compensatory warrants were issued during the six months ended June 30, 2023.

The following table summarizes the activity in the common stock equity classified compensatory warrants for the six months ended June 30, 2023:

SCHEDULE OF WARRANT ACTIVITY

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		179,046	$	9.12	$1.32 — $25.40		1.73
Granted to advisor and its designees		—		—
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2023		179,046	$	9.12	$1.32 — $25.40		1.24
Exercisable		179,046	$	9.12	$1.32 — $25.40			1.24
Non-Exercisable		—	$	—	$	—		—

The following table summarizes the activity in the common stock equity classified compensatory warrants for the six months ended June 30, 2022:

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		179,065	$	15.20	$11.10 — $25.40		2.64
Granted to advisor and its designees		—		—
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2022		179,065	$	10.60	$5.14 — $25.40		2.23
Exercisable		179,065	$	10.60	$5.14 — $25.40			2.23
Non-Exercisable		—	$	—	$	—		—

There were no compensation costs related to outstanding equity classified compensatory warrants for the six months ended June 30, 2023 and $67,370 for the six months ended June 30, 2022.

Noncompensatory Equity Classified Warrants

No noncompensatory equity classified warrants were issued during the six months ended June 30, 2023.

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2023:

SCHEDULE OF WARRANT ACTIVITY

	Common Stock
	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		547,003		$	19.76	$1.32 - $20.00		0.33
Legacy Ritter warrants		—			—
Granted		—			—
Exercised		—			—
Expired		(455,685	)		20.00		20.00
Forfeited		—			—
Total outstanding – June 30, 2023		91,318		$	18.56			-
Exercisable		91,318		$	18.56	$1.32 — $20.00			0.58
Non-Exercisable		—		$	—	$	—		—

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2022:

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		554,914	$	20.10
Legacy Ritter warrants		—		—
Granted		331,464		0.01		0.01
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2022		886,378	$	12.60
Exercisable		886,378	$	12.60	$0.01 — $37.70			0.82
Non-Exercisable		—	$	—	$	—		—

RELATED PARTY TRANSACTIONS

6 Months Ended

Jun. 30, 2023

RELATED PARTY TRANSACTIONS

NOTE 15 — RELATED PARTY TRANSACTIONS

Convertible Debt

Short-Term Debt

NanoSynex Acquisition

SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2023

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 16 — SUBSEQUENT EVENTS

QN-302 Phase 1 Study

Stock Purchase Agreement with Chembio Diagnostics, Inc. and Biosynex, S.A.

The aggregate net purchase price paid to the Company for the Shares was $5.2 million in cash, based on a base purchase price of $5.8 million, subject to certain post-closing adjustments, upward or downward, as applicable, for: (i) cash held by Qualigen, Inc. as of the closing of the Transaction; (ii) net working capital of Qualigen, Inc. as of the closing of the Transaction, (iii) certain indebtedness of Qualigen, Inc. as of the closing of the Transaction, and (iv) certain Transaction expenses as of the closing of the Transaction. Of the $5.2 million in cash, $450,000 is being held in escrow to satisfy certain Company indemnification obligations. Any amounts remaining in the Indemnity Escrow that have not been offset or reserved for claims will be released to the Company within five business days following the date that is 18 months after the closing.

Amendment and Settlement Agreement with NanoSynex Ltd.

Stockholder Approval of Alpha Stock Issuance Proposal

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES (Policies)

6 Months Ended

Jun. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization

Organization

Basis of Presentation

Basis of Presentation

Principles of Consolidation

Principles of Consolidation

Accounting Estimates

Accounting Estimates

Reverse Stock Split

Reverse Stock Split

Cash

Cash

Inventory, Net

Inventory, Net

Impairment of Long-Lived Assets

Impairment of Long-Lived Assets

Segment Reporting

Segment Reporting

Accounts Receivable, Net

Accounts Receivable, Net

Accounts receivable, net is comprised of the following at:

SCHEDULE OF ACCOUNTS RECEIVABLE

	June 30, 2023			December 31, 2022
Accounts Receivable	$	733,964		$	726,449
Less Reserves and Allowances		(54,584	)		(187,862	)
Accounts receivable, net	$	679,380		$	538,587

Research and Development

Research and Development

Except for acquired in process research and development (IPR&D), the Company expenses research and development costs as incurred including therapeutics license costs.

R&D Grants

R&D Grants

Patent Costs

Patent Costs

Shipping and Handling Costs

Shipping and Handling Costs

Revenue from Contracts with Customers

Revenue from Contracts with Customers

Product Sales

Contract Asset and Liability Balances

Deferred Revenue

Deferred Revenue

Operating Leases

Operating Leases

Property and Equipment, Net

Property and Equipment, Net

Machinery and equipment			5 years
Computer equipment			3 years
Molds and tooling			5 years
Furniture and fixtures			5 years

The Company’s policy is to evaluate the remaining lives and recoverability of long-term assets on at least an annual basis or when conditions are present that indicate impairment.

Business Combinations

Business Combinations

Goodwill

Goodwill

Intangible Assets

Intangible Assets

In Process R&D

Other Intangible Assets, Net

Derivative Financial Instruments and Warrant Liabilities

Derivative Financial Instruments and Warrant Liabilities

Fair Value Measurements

	●	Level 1 - Inputs that reflect unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date;
	●	Level 2 - Inputs other than quoted prices that are observable for the assets or liability either directly or indirectly, including inputs in markets that are not considered to be active; and
	●	Level 3 - Inputs that are unobservable.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

Comprehensive Loss

Comprehensive Loss

Stock-Based Compensation

Stock-Based Compensation

Income Taxes

Income Taxes

Sales and Excise Taxes

Sales and Excise Taxes

Warranty Costs

Warranty Costs

Foreign Currency Translation

Foreign Currency Translation

War in Ukraine

War in Ukraine

Inflation and Global Economic Conditions

Inflation and Global Economic Conditions

Impact of COVID-19 Pandemic

Impact of COVID-19 Pandemic

Other accounting standard updates are either not applicable to the Company or are not expected to have a material impact on the Company’s condensed consolidated financial statements.

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES (Tables)

6 Months Ended

Jun. 30, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

SCHEDULE OF ACCOUNTS RECEIVABLE

Accounts receivable, net is comprised of the following at:

SCHEDULE OF ACCOUNTS RECEIVABLE

	June 30, 2023			December 31, 2022
Accounts Receivable	$	733,964		$	726,449
Less Reserves and Allowances		(54,584	)		(187,862	)
Accounts receivable, net	$	679,380		$	538,587

SCHEDULE OF USEFUL LIVES OF PROPERTY AND EQUIPMENT

Machinery and equipment			5 years
Computer equipment			3 years
Molds and tooling			5 years
Furniture and fixtures			5 years

INVENTORY, NET (Tables)

6 Months Ended

Jun. 30, 2023

Inventory Disclosure [Abstract]

SCHEDULE OF INVENTORY

Inventory, net consisted of the following at June 30, 2023 and December 31, 2022:

SCHEDULE OF INVENTORY

	June 30, 2023		December 31, 2022
Raw materials	$	1,027,455	$	949,796
Work in process		177,591		200,318
Finished goods		358,353		436,183
Total inventory	$	1,563,399	$	1,586,297

PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)

6 Months Ended

Jun. 30, 2023

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid expenses and other current assets consisted of the following at June 30, 2023 and December 31, 2022:

	June 30, 2023		December 31, 2022
Prepaid insurance	$	938,106	$	1,377,323
Prepaid manufacturing expenses		51,710		43,820
Other prepaid expenses		65,288		227,451
Prepaid research and development expenses		211,337		—
Other current assets		11,636		12,626
	$	1,278,077	$	1,661,220

PROPERTY AND EQUIPMENT, NET (Tables)

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

SCHEDULE OF PROPERTY AND EQUIPMENT

Property and equipment, net consisted of the following at June 30, 2023 and December 31, 2022:

SCHEDULE OF PROPERTY AND EQUIPMENT

	June 30, 2023			December 31, 2022
Machinery and equipment	$	2,735,507		$	2,510,148
Computer equipment		369,589			395,836
Leasehold improvements		336,916			333,271
Molds and tooling		260,002			260,002
Furniture and fixtures		144,832			144,832
Equipment held for lease		1,405,384			1,399,444
Property and equipment, gross		5,252,230			5,043,533
Accumulated depreciation		(4,678,583	)		(4,623,446	)
Fixed asset impairment		(75,000	)		(75,000	)
Property and equipment, net	$	498,647		$	345,087

GOODWILL, IPR&D AND OTHER INTANGIBLES (Tables)

6 Months Ended

Jun. 30, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

SCHEDULE OF GOODWILL AND OTHER INTANGIBLES

		June 30,			December 31,
		2023			2022
	Estimated Useful Lives	Gross carrying amounts			Gross carrying amounts

Goodwill		$	625,602		$	625,602

Finite-lived intangible assets:
Developed-product-technology rights	8 - 17 years	$	479,103		$	479,103
Licensing rights	10 years		418,836			418,836
Less: Accumulated amortization			(764,869	)		(752,237	)
Total finite-lived intangible assets, net			133,070			145,702
Indefinite-lived intangible assets:
In-process research and development			5,700,000			5,700,000
Total other intangible assets, net		$	5,833,070		$	5,845,702

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2023

Payables and Accruals [Abstract]

SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consisted of the following at June 30, 2023 and December 31, 2022:

	June 30, 2023		December 31, 2022
Board compensation	$	84,000		70,000
Equipment held for lease		—		154,433
Franchise, sales and use taxes		30,407		27,531
Income taxes		6,921		4,663
Interest (Convertible debt - related party)		50,101		2,829
License fees		100,026		150,130
Payroll		484,048		209,303
Professional fees		368,032		238,211
Research and development		523,490		322,987
Royalties		16,383		13,158
Warranty liability		140,370		137,568
Other		176,777		181,043
	$	1,980,555	$	1,511,856

WARRANT LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2023

Warrant Liabilities

SCHEDULE OF WARRANTS ACTIVITY

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2023:

SCHEDULE OF WARRANTS ACTIVITY

	Common Stock Warrants
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		3,849,571	$	1.53		$1.32 - $1.65		3.9
Exercised		—		—		—		—
Forfeited		—		—		—		—
Expired		—		—		—		—
Granted		—		—		—		—
Total outstanding – June 30, 2023		3,849,571	$	1.53		$1.32 - $1.65		3.41
Exercisable		3,849,571	$	1.53		$1.32 - $1.65		3.41

The following table summarizes the activity in liability classified warrants for the six months ended June 30, 2022:

	Common Stock Warrants
	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding –December 31, 2021		248,161		$	7.20				2.00
Exercised		(536	)		7.20
Forfeited		(247,625	)		7.20
Expired		—			—
Granted		346,896			5.10
Total outstanding – June 30, 2022		346,896		$	5.10
Exercisable		346,896		$	5.10	$	5.10		1.51

SCHEDULE OF FAIR VALUE HIERARCHY FOR WARRANT LIABILITIES

The following table presents the Company’s fair value hierarchy for its liabilities measured at fair value on a recurring basis as of June 30, 2023:

	Quoted
	Market		Significant
	Prices for		Other		Significant
	Identical		Observable		Unobservable
	Assets		Inputs		Inputs
Common Stock Warrant liabilities	(Level 1)		(Level 2)		(Level 3)			Total
Balance as of December 31, 2022	$	—	$	—	$	3,622,647		$	3,622,647
Exercises		—		—		—			—
Gain on change in fair value of warrant liabilities		—		—		(1,478,967	)		(1,478,967	)
Balance as of June 30, 2023	$	—	$	—	$	2,143,680		$	2,143,680

SCHEDULE OF ASSUMPTIONS OF WARRANT LIABILITIES

	June 30, 2023						June 30, 2022
	Range			Weighted Average			Range			Weighted Average
Risk-free interest rate	4.05% — 5.31%				4.49	%	2.80% — 2.87%				2.82	%
Expected volatility (peer group)	66.3% — 134%				110.55	%	74% — 96%				78.6	%
Term of warrants (in years)	.39 — 4.98			3.41			1.39 — 1.99			1.51
Expected dividend yield		0.00	%		0.00	%		0.00	%		0.00	%

CONVERTIBLE DEBT- RELATED PARTY (Tables)

6 Months Ended

Jun. 30, 2023

Debt Disclosure [Abstract]

SCHEDULE OF SENIOR SECURED CONVERTIBLE DEBT

Convertible debt-related party is comprised of the following as of June 30, 2023 and December 31, 2022:

	June 30, 2023			December 31, 2022
Senior secured convertible debenture	$	2,078,922		$	3,300,000
Discount on convertible debenture		(1,266,503	)		(3,239,803	)
Total convertible debt-related party	$	812,419		$	60,197

EARNINGS (LOSS) PER SHARE (Tables)

6 Months Ended

Jun. 30, 2023

Earnings Per Share [Abstract]

SCHEDULE OF DILUTIVE SECURITIES EXCLUDED FROM DILUTED NET LOSS PER SHARE

The following potentially dilutive securities have been excluded from diluted net loss per share as of June 30, 2023 and 2022 because their effect would be anti-dilutive:

	As of June 30,
	2023		2022
Shares of common stock subject to outstanding options		445,163		476,783
Shares of common stock subject to outstanding warrants		4,119,934		1,412,338
Total common stock equivalents		4,565,097		1,889,121

COMMITMENTS AND CONTINGENCIES (Tables)

6 Months Ended

Jun. 30, 2023

Commitments and Contingencies Disclosure [Abstract]

SCHEDULE OF OPERATING LEASE RIGHT OF USE ASSETS AND OPERATING LEASE LIABILITIES

The tables below show the operating lease right-of-use assets and operating lease liabilities as of June 30, 2023, including the changes during the periods:

	Operating lease right-of-use assets
Net right-of-use assets at December 31, 2022	$	1,422,538
Less amortization of operating lease right-of-use assets		(116,568	)
Operating lease right-of-use assets at June 30, 2023	$	1,305,970

	Operating lease liabilities
Lease liabilities at December 31, 2022	$	1,542,564
Less principal payments on operating lease liabilities		(116,756	)
Lease liabilities at June 30, 2023		1,425,808
Less non-current portion		(1,168,653	)
Current portion at June 30, 2023	$	257,155

SCHEDULE OF MATURITIES OF OPERATING LEASE LIABILITIES

As of June 30, 2023, future minimum payments during the next five fiscal years and thereafter are as follows:

Year Ending December 31,	Amount
2023 (six months)		184,171
2024		379,392
2025		390,773
2026		402,497
2027		379,164
Total		1,735,997
Less present value discount		(310,189	)
Operating lease liabilities	$	1,425,808

STOCKHOLDERS’ EQUITY (Tables)

6 Months Ended

Jun. 30, 2023

Accumulated Other Comprehensive Income (Loss) [Line Items]

SCHEDULE OF RESERVED SHARES


Exercise of issued and future grants of stock options			445,163
Exercise of stock warrants			4,119,934
Total			4,565,097

SCHEDULE OF STOCK OPTION ACTIVITY

	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		608,012		$	35.02		$5.14 - $51.30		8.09
Granted		—			—		—		—
Expired		—			—		—		—
Forfeited		(162,849	)		36.01		5.14 - 51.30		—
Total outstanding – June 30, 2023		445,163		$	34.68		$5.14 — $51.30		7.59
Exercisable (vested)		323,355		$	44.79		$5.14 — $51.30		7.13
Non-Exercisable (non-vested)		121,808		$	7.83		$5.14 - $35.20		8.85

	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		484,186		$	60.70	$12.40 — $14,657.50			8.52
Granted		2,500			10.50		10.50		9.54
Expired		(9,386	)		935.90		57.50 - 14,657.50		—
Forfeited		(517	)		35.10		12.40 - 49.70		—
Total outstanding – June 30, 2022		476,783		$	43.30		$10.50 — $51.30		8.19
Exercisable (vested)		264,366		$	48.40		$12.40 — $50.13		8.00
Non-Exercisable (non-vested)		212,417		$	36.80		$10.50 — $51.30		8.48

SCHEDULE OF ASSUMPTION USED IN BLACK-SCHOLES OPTION-PRICING METHOD

The material factors incorporated in the Black-Scholes model in estimating the fair value of the options granted for the periods presented were as follows:

	For the Six Months Ended June 30,
	2023			2022
Expected dividend yield		0.00	%		0.00	%
Expected stock-price volatility		—			102	%
Risk-free interest rate		—		1.58% — 1.67		%
Expected average term of options (in years)		—			6.00
Stock price	$	—		$	1.05

SCHEDULE OF SHARE-BASED COMPENSATION EXPENSE

The Company recorded share-based compensation expense and classified it in the unaudited condensed consolidated statements of operations as follows:

	2023		2022
	For the Six Months Ended June 30,
	2023		2022
General and administrative	$	807,980	$	2,329,418
Research and development		98,165		361,029
Total	$	906,145	$	2,690,447

Compensatory Warrant Activity [Member]

Accumulated Other Comprehensive Income (Loss) [Line Items]

SCHEDULE OF WARRANT ACTIVITY

The following table summarizes the activity in the common stock equity classified compensatory warrants for the six months ended June 30, 2023:

SCHEDULE OF WARRANT ACTIVITY

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		179,046	$	9.12	$1.32 — $25.40		1.73
Granted to advisor and its designees		—		—
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2023		179,046	$	9.12	$1.32 — $25.40		1.24
Exercisable		179,046	$	9.12	$1.32 — $25.40			1.24
Non-Exercisable		—	$	—	$	—		—

The following table summarizes the activity in the common stock equity classified compensatory warrants for the six months ended June 30, 2022:

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		179,065	$	15.20	$11.10 — $25.40		2.64
Granted to advisor and its designees		—		—
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2022		179,065	$	10.60	$5.14 — $25.40		2.23
Exercisable		179,065	$	10.60	$5.14 — $25.40			2.23
Non-Exercisable		—	$	—	$	—		—

Non Compensatory Warrant Activity [Member]

Accumulated Other Comprehensive Income (Loss) [Line Items]

SCHEDULE OF WARRANT ACTIVITY

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2023:

SCHEDULE OF WARRANT ACTIVITY

	Common Stock
	Shares			Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2022		547,003		$	19.76	$1.32 - $20.00		0.33
Legacy Ritter warrants		—			—
Granted		—			—
Exercised		—			—
Expired		(455,685	)		20.00		20.00
Forfeited		—			—
Total outstanding – June 30, 2023		91,318		$	18.56			-
Exercisable		91,318		$	18.56	$1.32 — $20.00			0.58
Non-Exercisable		—		$	—	$	—		—

The following table summarizes the noncompensatory equity classified warrant activity for the six months ended June 30, 2022:

	Common Stock
	Shares		Weighted– Average Exercise Price		Range of Exercise Price		Weighted– Average Remaining Life (Years)
Total outstanding – December 31, 2021		554,914	$	20.10
Legacy Ritter warrants		—		—
Granted		331,464		0.01		0.01
Exercised		—		—
Expired		—		—
Forfeited		—		—
Total outstanding – June 30, 2022		886,378	$	12.60
Exercisable		886,378	$	12.60	$0.01 — $37.70			0.82
Non-Exercisable		—	$	—	$	—		—

SCHEDULE OF ACCOUNTS RECEIVABLE (Details) - USD ($)	Dec. 31, 2023	Jun. 30, 2023	Dec. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accounts Receivable	$ 726,449	$ 733,964
Less Reserves and Allowances	(187,862)	(54,584)
Accounts receivable, net	$ 538,587	$ 679,380	$ 538,587

SCHEDULE OF USEFUL LIVES OF PROPERTY AND EQUIPMENT (Details)	Jun. 30, 2023
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful life	5 years
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful life	3 years
Molds and Tooling [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful life	5 years
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, useful life	5 years

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ESTIMATES (Details Narrative) - USD ($)		3 Months Ended		6 Months Ended		12 Months Ended
	May 26, 2022	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Jul. 20, 2023	Dec. 22, 2022	Apr. 25, 2022	Dec. 31, 2021	Dec. 31, 2020
Warrants to purchase common stock											219,101
Warrants exercise price										$ 13.20	$ 40.70
Reverse stock split	These warrants were subsequently exercised on September 13, 2022
Stock issued during period, value, acquisitions			$ 1,844,500
Impairment losses on construction-in-progress		$ 0	0	$ 0	$ 0
Allowance for estimated returns		28,000	10,000	33,000	53,000
Goodwill impairment charges						$ 4,239,000
Goodwill and intangible asset impairment				0	0
Estimated useful lives							5 years
Accrued warranty liabilities		140,370		140,370		137,568
Warranty costs		63,000	22,000	104,000	41,000
Adjustment net of tax		$ (56,747)	65,540	$ 119,473	65,540
Minimum [Member] \| Patents and Licenses [Member]
Estimated useful lives		5 years		5 years
Maximum [Member] \| Patents and Licenses [Member]
Estimated useful lives		17 years		17 years
Selling and Marketing Expense [Member]
Other shipping and handling costs		$ 0	4,000	$ 4,000	8,000
Shipping and Handling [Member]
Other shipping and handling costs		78,000	$ 72,000	144,000	$ 111,000
Pre-funded Warrant [Member]
Warrants to purchase common stock	331,464
Warrants exercise price	$ 0.001
Warrant [Member]
Warrants to purchase common stock	67,619							67,620	67,619
Warrants exercise price									$ 6.00
Accrued warranty liabilities		$ 140,000		$ 140,000		138,000
Warrant [Member] \| Minimum [Member]
Warrants exercise price	$ 11.10							$ 5.136	11.10
Warrant [Member] \| Maximum [Member]
Warrants exercise price	$ 5.136							$ 1.32	$ 5.136
Series B Preferred Stock [Member]
Stock issued during period shares acquisitions	381,786
NanoSynex Ltd [Member]
Stock issued during period shares acquisitions	350,000
Voting interests acquired	52.80%
Adjustment net of tax						$ 65,540
NanoSynex Ltd [Member] \| Series A-1 Preferred Stock [Member]
Stock issued during period shares acquisitions	2,232,861
NanoSynex Ltd [Member] \| Series B Preferred Stock [Member]
Stock issued during period shares acquisitions	381,786
Stock issued during period, value, acquisitions	$ 600,000

LIQUIDITY (Details Narrative) - USD ($)		1 Months Ended	6 Months Ended		12 Months Ended	13 Months Ended
LIQUIDITY (Details Narrative) - USD ($)	Jul. 20, 2023	Dec. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Dec. 31, 2023	Mar. 31, 2024	Nov. 30, 2023	Jan. 12, 2023
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Cash	$ 5,200,000	$ 7,034,434	$ 1,341,659		$ 7,034,434
Accumulated deficit		103,385,172	110,695,598		103,385,172
Net cash used in operating activities			5,562,416	$ 7,827,798	$ 13,200,000
Share based compensation	$ 5,800,000		906,145	$ 2,690,447
Escrow deposit			$ 450,000
Proceeds from issuance of common stock		$ 8,800,000
Proceeds from issuance of debt						$ 3.0
Aggregrate amount									$ 1,111,078
Subsequent Event [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Sale of stock price per share	$ 1.5716
Subsequent Event [Member] \| Amendment and Settlement Agreement [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Aggregrate amount	$ 380,000
Subsequent Event [Member] \| Amendment and Settlement Agreement [Member] \| NanoSynex Ltd [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Aggregrate amount	$ 1,610,000						$ 670,000	$ 560,000
NanoSynex Ltd [Member] \| Subsequent Event [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Business acquisition, description of acquired entity	Pursuant to the terms of the NanoSynex Amendment, the Company agreed to advance to NanoSynex an aggregate amount of $1,610,000 as follows: (i) $380,000 within five business days of the execution of the NanoSynex Amendment, (ii) $560,000 on or before November 30, 2023, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding, and (iii) $670,000 on or before March 31, 2024, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding. The NanoSynex Amendment further provides that the initial payment of $380,000 will be satisfied by the Company’s surrender of the 281,000 Preferred B Shares of NanoSynex currently held by the Company, resulting in the Company’s ownership in NanoSynex being reduced from approximately 52.8% to approximately 49.97% of the issued and outstanding voting equity of NanoSynex.

SCHEDULE OF INVENTORY (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Inventory Disclosure [Abstract]
Raw materials	$ 1,027,455	$ 949,796
Work in process	177,591	200,318
Finished goods	358,353	436,183
Total inventory	$ 1,563,399	$ 1,586,297

SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid insurance	$ 938,106	$ 1,377,323
Prepaid manufacturing expenses	51,710	43,820
Other prepaid expenses	65,288	227,451
Prepaid research and development expenses	211,337
Other current assets	11,636	12,626
Prepaid expenses and other current assets	$ 1,278,077	$ 1,661,220

SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 5,252,230	$ 5,043,533
Accumulated depreciation	(4,678,583)	(4,623,446)
Fixed asset impairment	(75,000)	(75,000)
Property and equipment, net	498,647	345,087
Machinery and Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	2,735,507	2,510,148
Computer Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	369,589	395,836
Leasehold Improvements [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	336,916	333,271
Molds and Tooling [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	260,002	260,002
Furniture and Fixtures [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	144,832	144,832
Equipment [Member]
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 1,405,384	$ 1,399,444

PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($)		3 Months Ended		6 Months Ended
	Mar. 31, 2022	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Depreciation expense		$ 19,000	$ 24,000	$ 37,000	$ 48,000
Payments to acquire assets				$ 246,418	$ 63,483
Sekisui Distribution Agreement [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Payments to acquire assets	$ 154,000

SCHEDULE OF GOODWILL AND OTHER INTANGIBLES (Details) - USD ($)	Jul. 20, 2023	Jun. 30, 2023	Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]
Goodwill		$ 625,602	$ 625,602
Finite lived intangible asset useful life	5 years
Less: Accumulated amortization		(764,869)	(752,237)
Total finite-lived intangible assets, net		133,070	145,702
Total other intangible assets, net		5,833,070	5,845,702
In Process Research and Development [Member]
Finite-Lived Intangible Assets [Line Items]
Total other intangible assets, net		5,700,000	5,700,000
Developed-Product-Technology Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Licensing rights		$ 479,103	479,103
Developed-Product-Technology Rights [Member] \| Minimum [Member]
Finite-Lived Intangible Assets [Line Items]
Finite lived intangible asset useful life		8 years
Developed-Product-Technology Rights [Member] \| Maximum [Member]
Finite-Lived Intangible Assets [Line Items]
Finite lived intangible asset useful life		17 years
Licensing Rights [Member]
Finite-Lived Intangible Assets [Line Items]
Licensing rights		$ 418,836	$ 418,836
Finite lived intangible asset useful life		10 years

GOODWILL, IPR&D AND OTHER INTANGIBLES (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Jul. 20, 2023
Finite-Lived Intangible Assets [Line Items]
Goodwill, impairment loss					$ 4,239,000
Impairment of intangible assets	$ 0	$ 0	$ 0	$ 0
Accumulated amortization	764,869		764,869		752,237
Estimated useful life						5 years
Patents [Member]
Finite-Lived Intangible Assets [Line Items]
Finite lived intangible assets gross	131,000		131,000		140,000
Accumulated amortization	348,000		348,000		339,000
Amortization of intangible assets	9,000	5,000	9,000	9,000
License [Member]
Finite-Lived Intangible Assets [Line Items]
Finite lived intangible assets gross	2,000		2,000		5,000
Accumulated amortization	417,000		417,000		$ 414,000
Amortization of intangible assets	$ 3,000	$ 3,000	$ 3,000	$ 3,000

SCHEDULE OF ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Payables and Accruals [Abstract]
Board compensation	$ 84,000	$ 70,000
Equipment held for lease		154,433
Franchise, sales and use taxes	30,407	27,531
Income taxes	6,921	4,663
Interest (Convertible debt - related party)	50,101	2,829
License fees	100,026	150,130
Payroll	484,048	209,303
Professional fees	368,032	238,211
Research and development	523,490	322,987
Royalties	16,383	13,158
Warranty liability	140,370	137,568
Other	176,777	181,043
Accrued expenses and other current liabilities	$ 1,980,555	$ 1,511,856

SHORT TERM DEBT-RELATED PARTY (Details Narrative) - USD ($)	17 Months Ended
	Sep. 02, 2021	Jun. 30, 2023	Jan. 12, 2023	Dec. 31, 2022	Dec. 22, 2022
Short-Term Debt [Line Items]
Short term debt principal outstanding			$ 1,111,078
Accrued interest		$ 50,101		$ 2,829
Short term debt outstanding balance		965,155		$ 950,722
Accrued interest rate					8.00%
Notes Payable [Member] \| Nano Synex Ltd [Member]
Short-Term Debt [Line Items]
Short term debt principal outstanding	$ 905,000
Accrued interest		60,155
Short term debt outstanding balance		$ 965,155
Accrued interest rate	2.62%
Proceeds from related party debt	$ 3,000,000

SCHEDULE OF WARRANTS ACTIVITY (Details) - Series C Warrants [Member] - Common Stock Warrants [Member] - $ / shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Number of Shares, Warrants Outstanding Beginning	3,849,571	248,161
Weighted Average Exercise Price Per Share Warrants Outstanding Beginning	$ 1.53	$ 7.20
Weighted Average Remaining Contractual Term	3 years 10 months 24 days
Number of Shares, Warrants Exercised		(536)
Weighted Average Exercise Price Per Share Warrants Exercised		$ 7.20
Number of Shares, Warrants Forfeited		(247,625)
Weighted Average Exercise Price Per Share Warrants Forfeited		$ 7.20
Number of Shares, Warrants Expired
Weighted Average Exercise Price Per Share Warrants Expired
Number of Shares, Warrants Granted		346,896
Weighted Average Exercise Price Per Share Warrants Granted		$ 5.10
Number of Shares, Warrants Outstanding Ending	3,849,571	346,896
Weighted Average Exercise Price Per Share Warrants Outstanding Ending	$ 1.53	$ 5.10
Weighted Average Remaining Contractual Term	3 years 4 months 28 days	2 years
Number of Shares, Warrants Exercisable	3,849,571	346,896
Weighted Average Exercise Price Per Share Exercisable	$ 1.53	$ 5.10
Range of Exercise Price, Exercisable		$ 5.10
Exercisable Weighted Averag Remaining Contractual Term	3 years 4 months 28 days	1 year 6 months 3 days
Minimum [Member]
Range of Exercise Beginning	$ 1.32
Range of Exercise Ending	1.32
Range of Exercise Price, Exercisable	1.32
Maximum [Member]
Range of Exercise Beginning	1.65
Range of Exercise Ending	1.65
Range of Exercise Price, Exercisable	$ 1.65

SCHEDULE OF FAIR VALUE HIERARCHY FOR WARRANT LIABILITIES (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Platform Operator, Crypto-Asset [Line Items]
Fair value for warrant liabilities, beginning balance	$ 3,622,647
Common Stock Warrant liabilities, Exercises		$ (858)
Change in fair value of warrant liabilities	(1,478,967)
Fair value for warrant liabilities, ending balance	2,143,680
Fair Value, Inputs, Level 1 [Member]
Platform Operator, Crypto-Asset [Line Items]
Fair value for warrant liabilities, beginning balance
Common Stock Warrant liabilities, Exercises
Change in fair value of warrant liabilities
Fair value for warrant liabilities, ending balance
Fair Value, Inputs, Level 2 [Member]
Platform Operator, Crypto-Asset [Line Items]
Fair value for warrant liabilities, beginning balance
Common Stock Warrant liabilities, Exercises
Change in fair value of warrant liabilities
Fair value for warrant liabilities, ending balance
Fair Value, Inputs, Level 3 [Member]
Platform Operator, Crypto-Asset [Line Items]
Fair value for warrant liabilities, beginning balance	3,622,647
Common Stock Warrant liabilities, Exercises
Change in fair value of warrant liabilities	(1,478,967)
Fair value for warrant liabilities, ending balance	$ 2,143,680

SCHEDULE OF ASSUMPTIONS OF WARRANT LIABILITIES (Details)	Jun. 30, 2023	Jun. 30, 2022
Measurement Input, Expected Dividend Rate [Member]
Fair value assumptions, measurement input, percentages	0.00	0.00
Minimum [Member] \| Measurement Input, Risk Free Interest Rate [Member]
Fair value assumptions, measurement input, percentages	4.05	2.80
Minimum [Member] \| Measurement Input, Price Volatility [Member]
Fair value assumptions, measurement input, percentages	66.3	74
Minimum [Member] \| Measurement Input, Expected Term [Member]
Fair value assumptions, measurement input, term	4 months 20 days	1 year 4 months 20 days
Maximum [Member] \| Measurement Input, Risk Free Interest Rate [Member]
Fair value assumptions, measurement input, percentages	5.31	2.87
Maximum [Member] \| Measurement Input, Price Volatility [Member]
Fair value assumptions, measurement input, percentages	134	96
Maximum [Member] \| Measurement Input, Expected Term [Member]
Fair value assumptions, measurement input, term	4 years 11 months 23 days	1 year 11 months 26 days
Weighted Average [Member] \| Measurement Input, Risk Free Interest Rate [Member]
Fair value assumptions, measurement input, percentages	4.49	2.82
Weighted Average [Member] \| Measurement Input, Price Volatility [Member]
Fair value assumptions, measurement input, percentages	110.55	78.6
Weighted Average [Member] \| Measurement Input, Expected Term [Member]
Fair value assumptions, measurement input, term	3 years 4 months 28 days	1 year 6 months 3 days
Weighted Average [Member] \| Measurement Input, Expected Dividend Rate [Member]
Fair value assumptions, measurement input, percentages	0.00	0.00

WARRANT LIABILITIES (Details Narrative) - $ / shares	Dec. 22, 2022	May 26, 2022	Apr. 25, 2022	Jun. 30, 2023	Dec. 31, 2021	Dec. 31, 2020
Exercise price of warrant					$ 13.20	$ 40.70
Warrant to purchase shares					60,000
Minimum [Member] \| Series C Warrants [Member]
Exercise price of warrant	$ 1.32	$ 5.136	$ 6.00
Warrants and rights outstanding term				4 months 24 days
Maximum [Member] \| Series C Warrants [Member]
Exercise price of warrant	$ 5.136	$ 6.00	$ 7.195
Warrants and rights outstanding term				11 months 26 days
Series C Warrants [Member]
Exercise price of warrant				$ 7.195
Warrants issued	1,002,717	49,952	49,318
Warrants forfeited		247,625
Warrants reissued		346,896
Series C Warrants [Member] \| Alpha Capital [Member]
Exercise price of warrant	$ 1.65
Warrant to purchase shares	2,500,000
Conversion price percentage	125.00%

SCHEDULE OF SENIOR SECURED CONVERTIBLE DEBT (Details) - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Short-Term Debt [Line Items]
Total convertible debt-related party	$ 812,419	$ 60,197
Senior Secured Convertible Debt [Member]
Short-Term Debt [Line Items]
Senior secured convertible debenture	2,078,922	3,300,000
Discount on convertible debenture	(1,266,503)	(3,239,803)
Total convertible debt-related party	$ 812,419	$ 60,197

CONVERTIBLE DEBT- RELATED PARTY (Details Narrative) - USD ($)			3 Months Ended	6 Months Ended
	Jan. 12, 2023	Dec. 22, 2022	Jun. 30, 2023	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Dec. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Short-Term Debt [Line Items]
Conversion price	$ 1.32
Warrant to purchase shares								60,000
Exercise price of warrant								$ 13.20	$ 40.70
Debenture accrues interest rate		8.00%
Shares of Common stock, issued			5,052,463	5,052,463		4,210,737
Debt discount amortization			$ 364,000	$ 898,000
Fair value of warrants				(1,478,967)	$ (698,042)
Shares of common stock	841,726
Debenture voluntarily converted	$ 1,111,078
Debt conversion of convertible debt	$ 1,100,000
Accrued interest			383,000	945,000
Fair value of warrants			2,000,000.0	2,000,000.0
Derivative fair value of warrants			$ 0	$ 0
Alpha Capital [Member]
Short-Term Debt [Line Items]
Beneficial ownership percentage		9.99%
Shares of Common stock, issued							5,157,087
Series C Warrants [Member]
Short-Term Debt [Line Items]
Exercise price of warrant			$ 7.195	$ 7.195
Senior Convertible Debenture [Member]
Short-Term Debt [Line Items]
Principal amount percentage		105.00%
Alpha Capital [Member] \| Series C Warrants [Member]
Short-Term Debt [Line Items]
Warrant to purchase shares		2,500,000
Exercise price of warrant		$ 1.65
Conversion price percentage		125.00%
Alpha Capital [Member] \| Senior Convertible Debenture [Member]
Short-Term Debt [Line Items]
Senior convertible debenture rate		8.00%
Principal amount		$ 3,300,000
Purchase Price		$ 3,000,000
Conversion price		$ 1.32
Alpha Capital Other Third Parties [Member]
Short-Term Debt [Line Items]
Debt discount amortization				$ 300,000
Fair value of warrants				2,800,000
Fair value of embedded derivative features			$ 0	0
Fees and costs paid				$ 100,000

SCHEDULE OF DILUTIVE SECURITIES EXCLUDED FROM DILUTED NET LOSS PER SHARE (Details) - shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total common stock equivalents	4,565,097	1,889,121
Shares of Common Stock Subject to Outstanding Options [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total common stock equivalents	445,163	476,783
Shares of Common Stock Subject to Outstanding Warrants [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total common stock equivalents	4,119,934	1,412,338

SCHEDULE OF OPERATING LEASE RIGHT OF USE ASSETS AND OPERATING LEASE LIABILITIES (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Operating lease right-of-use assets	$ 1,422,538
Less amortization of operating lease right-of-use assets	(116,567)	$ (109,803)
Operating lease right-of-use assets	1,305,970
Lease liabilities at December 31, 2022	1,425,808
Less non-current portion	(1,168,653)		$ (1,301,919)
Current portion at Decebmer 31, 2022	257,155		$ 240,645
Long term Operating Lease Agreement [Member]
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items]
Operating lease right-of-use assets	1,422,538
Less amortization of operating lease right-of-use assets	(116,568)
Operating lease right-of-use assets	1,305,970
Lease liabilities at December 31, 2021	1,542,564
Less principal payments on operating lease liabilities	(116,756)
Lease liabilities at December 31, 2022	1,425,808
Less non-current portion	(1,168,653)
Current portion at Decebmer 31, 2022	$ 257,155

SCHEDULE OF MATURITIES OF OPERATING LEASE LIABILITIES (Details)	Jun. 30, 2023 USD ($)
Commitments and Contingencies Disclosure [Abstract]
2023 (six months)	$ 184,171
2024	379,392
2025	390,773
2026	402,497
2027	379,164
Total	1,735,997
Less present value discount	(310,189)
Operating lease liabilities	$ 1,425,808

COMMITMENTS AND CONTINGENCIES (Details Narrative)				3 Months Ended		6 Months Ended
COMMITMENTS AND CONTINGENCIES (Details Narrative)	Jul. 20, 2023 USD ($) $ / shares	Apr. 05, 2022 USD ($)	Dec. 15, 2021 USD ($) ft²	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2022 USD ($)	Mar. 31, 2024 USD ($)	Nov. 30, 2023 USD ($)	Jan. 12, 2023 USD ($)
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Area of land \| ft²			22,624
Operating lease term			61 months
Operating lease term description			November 1, 2022 to November 30, 2027
Payments for Rent			$ 1,950,710
Tenant improvement allowance			339,360
Weighted-average remaining lease term				4 years 3 months 18 days		4 years 3 months 18 days
Weighted-average discount rate				8.90%		8.90%
Operating lease expense				$ 114,000	$ 119,000	$ 230,000	$ 233,000
Aggregrate amount										$ 1,111,078
Litigation Settlement, Amount Awarded to Other Party		$ 96,558
Subsequent Event [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Sale of Stock, Price Per Share \| $ / shares	$ 1.5716
Subsequent Event [Member] \| Amendment and Settlement Agreement [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Aggregrate amount	$ 380,000
Subsequent Event [Member] \| Amendment and Settlement Agreement [Member] \| NanoSynex Ltd [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Aggregrate amount	$ 1,610,000							$ 670,000	$ 560,000
NanoSynex Ltd [Member] \| Subsequent Event [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Business acquisition, description of acquired entity	Pursuant to the terms of the NanoSynex Amendment, the Company agreed to advance to NanoSynex an aggregate amount of $1,610,000 as follows: (i) $380,000 within five business days of the execution of the NanoSynex Amendment, (ii) $560,000 on or before November 30, 2023, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding, and (iii) $670,000 on or before March 31, 2024, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding. The NanoSynex Amendment further provides that the initial payment of $380,000 will be satisfied by the Company’s surrender of the 281,000 Preferred B Shares of NanoSynex currently held by the Company, resulting in the Company’s ownership in NanoSynex being reduced from approximately 52.8% to approximately 49.97% of the issued and outstanding voting equity of NanoSynex.
First 12 Months [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Payments for Rent			$ 335,966

RESEARCH AND LICENSE AGREEMENTS (Details Narrative) - USD ($)	1 Months Ended							3 Months Ended		6 Months Ended		13 Months Ended	47 Months Ended
	Mar. 31, 2022	Jan. 31, 2022	Feb. 28, 2021	Nov. 30, 2020	Jul. 31, 2020	Jun. 30, 2020	Mar. 31, 2019	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2023	Apr. 30, 2022	Dec. 31, 2021
Proceeds from convertible debt												$ 3.0
Research and development expense								$ 1,326,544	$ 1,506,227	$ 3,448,095	$ 3,370,972
Revenue from contract with customer excluding assessed tax								1,627,031	1,430,534	3,234,201	2,152,563
Yi Xin Zhen Duan Jishu Ltd [Member]
Deferred revenue								0	0	0	0			$ 670,000
Prediction Biosciences SAS [Member] \| Product [Member]
Revenue from contract with customer excluding assessed tax								0		86,000	0
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member]
Proceeds from convertible debt													$ 50,000
Reimbursement of research expenses													805,000
Patent costs													$ 200,000
Agreement term payment description													In addition, the Company agreed to pay ULRF (i) royalties, on patent-covered net sales associated with the commercialization of anti-nucleolin agent-conjugated nanoparticles, of 4% (on net sales up to a cumulative $250,000,000) or 5% (on net sales above a cumulative $250,000,000), until expiration of the last to expire of the licensed patents, (ii) 30% to 50% of any non-royalty sublicensee income received (50% for sublicenses granted in the first two years of the ULRF license agreement, 40% for sublicenses granted in the third or fourth years of the ULRF license agreement, and 30% for sublicenses granted in the fifth year of the ULRF license agreement or thereafter), (iii) reimbursements for ongoing costs associated with the preparation, filing, prosecution and maintenance of licensed patents, incurred prior to June 2018, and (iv) payments ranging from $100,000 to $5,000,000 upon the achievement of certain regulatory and commercial milestones.
Marketing approval expenses													$ 500,000
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member] \| Licensed Product Sales [Member]
Cumulative sales					$ 5,000,000								5,000,000
Regulatory marketing approval, expenses													500,000
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member] \| Phase 1 Clinical Trial [Member]
Milestone payment					50,000								100,000
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member] \| Phase 2 Clinical Trial [Member]
Milestone payment					100,000								200,000
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member] \| Phase 3 Clinical Trial [Member]
Milestone payment					150,000								350,000
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member] \| Minimum [Member]
Milestone payment					50,000								100,000
Shortfall payments													10,000
License and Sponsored Research Agreements [Member] \| University of Louisville Research Foundation [Member] \| Maximum [Member]
Milestone payment					$ 5,000,000								5,000,000
Shortfall payments													50,000
Sponsored Research and License Agreement [Member]
Research and development expense								0	77,000	0	164,000
License cost								1,000	14,000	29,000	18,000
Sponsored Research and License Agreement [Member] \| University of Louisville Research Foundation [Member]
Reimbursement of research expenses	$ 2,700,000		$ 2,700,000				$ 693,000
Agreement term payment description					In July 2020, the Company entered into an exclusive license agreement with ULRF for RAS interaction inhibitor drug candidates. Under the agreement, the Company took over development, regulatory approval and commercialization of the candidates from ULRF and is responsible for maintenance of the related intellectual property portfolio. In return, ULRF received approximately $112,000 for an upfront license fee and reimbursement of prior patent costs. In addition, the Company has agreed to pay ULRF (i) royalties, on patent-covered net sales associated with the commercialization, of 4% (on net sales up to a cumulative $250,000,000) or 5% (on net sales above a cumulative $250,000,000), until expiration of the licensed patent, and 2.5% (on net sales for any sales not covered by Licensed Patents), (ii) 30% to 50% of any non-royalty sublicensee income received (50% for sublicenses granted in the first two years of the ULRF license agreement, 40% for sublicenses granted in the third or fourth years of the ULRF license agreement, and 30% for sublicenses granted in the fifth year of the ULRF license agreement or thereafter), (iii) reimbursements for ongoing costs associated with the preparation, filing, prosecution and maintenance of licensed patents, incurred prior to July 2020,
Marketing approval expenses					$ 300,000
Revenue					500,000,000								$ 500,000,000
Sponsored Research and License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Minimum [Member]
Upfront license fee					20,000
Sponsored Research and License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Maximum [Member]
Upfront license fee					$ 100,000
Sponsored Research Agreements And License [Member]
Research and development expense								333,000	220,000	556,000	405,000
License cost								15,000	16,000	22,000	69,000
License Agreement [Member]
License cost								$ 0	$ 0	$ 0	$ 310,000
Reimbursement of patent		$ 160,000
License Agreement [Member] \| Upfront Payment [Member]
Reimbursement of patent		$ 150,000
License Agreement [Member] \| University of Louisville Research Foundation [Member]
Agreement term payment description						the Company agreed to pay ULRF (i) royalties, on patent-covered net sales associated with the commercialization of QN-165 as a treatment for COVID-19, of 4% (on net sales up to a cumulative $250,000,000) or 5% (on net sales above a cumulative $250,000,000), until expiration of the licensed patents, and 2.5% (on net sales for any sales not covered by Licensed Patents), (ii) 30% to 50% of any non-royalty sublicensee income received (50% for sublicenses granted in the first two years of the ULRF license agreement, 40% for sublicenses granted in the third or fourth years of the ULRF license agreement, and 30% for sublicenses granted in the fifth year of the ULRF license agreement or thereafter), (iii) reimbursements for ongoing costs associated with the preparation, filing, prosecution and maintenance of licensed patents, incurred prior to June 2020, and (iv) payments ranging from $50,000 to $5,000,000 upon the achievement of certain regulatory and commercial milestones.
Marketing approval expenses						$ 300,000
Revenue						500,000,000
Upfront license fee						24,000
License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Licensed Product Sales [Member]
Cumulative sales						5,000,000
License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Phase 1 Clinical Trial [Member]
Milestone payment						50,000
License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Phase 2 Clinical Trial [Member]
Milestone payment						100,000
License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Phase 3 Clinical Trial [Member]
Milestone payment						150,000
License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Minimum [Member]
Milestone payment						50,000
Research and development expense				$ 430,000		250,000
Upfront license fee						5,000
License Agreement [Member] \| University of Louisville Research Foundation [Member] \| Maximum [Member]
Milestone payment						5,000,000
Upfront license fee						$ 50,000

SCHEDULE OF RESERVED SHARES (Details)	Jun. 30, 2023 shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total	4,565,097
Equity Option [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total	445,163
Warrant [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total	4,119,934

SCHEDULE OF STOCK OPTION ACTIVITY (Details) - $ / shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Weighted- Average Remaining Contractual Life (in Years), Outstanding at Ending	1 year 5 months 19 days
Employees and Non-employee Service Provider [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Number of shares, options outstanding, beginning	608,012	484,186
Range of Exercise price, Options Outstanding	$ 35.02	$ 60.70
Weighted- Average Remaining Contractual Life (in Years), Outstanding, Beginning	8 years 1 month 2 days	8 years 6 months 7 days
Number of shares, options granted		2,500
Weighted average exercise price, options granted		$ 10.50
Number of shares, options expired		(9,386)
Weighted average exercise price, options expired		$ 935.90
Number of shares, options forfeited	(162,849)	(517)
Weighted average exercise price, options forfeited	$ 36.01	$ 35.10
Number of Shares, Options Outstanding at Ending	445,163	476,783
Range of Exercise price, Options Outstanding	$ 34.68	$ 43.30
Weighted- Average Remaining Contractual Life (in Years), Outstanding at Ending	7 years 7 months 2 days	8 years 2 months 8 days
Number of shares, options exercisable (vested)	323,355	264,366
Range of exercise price, options exercisable (vested)	$ 44.79	$ 48.40
Weighted- Average Remaining Contractual Life (in Years), Options Exercisable (vested)	7 years 1 month 17 days	8 years
Number of shares, options non-exercisable (non-vested)	121,808	212,417
Weighted average exercise price, options non-exercisable (non-vested)	$ 7.83	$ 36.80
Weighted- Average Remaining Contractual Life (in Years), Options Non-exercisable (non-vested)	8 years 10 months 6 days	8 years 5 months 23 days
Range of Exercise price, Options Outstanding		$ 10.50
Weighted- Average Remaining Contractual Life (in Years), Options Granted		9 years 6 months 14 days
Employees and Non-employee Service Provider [Member] \| Minimum [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Range of Exercise price, Options Outstanding	$ 5.14	$ 12.40
Range of Exercise price, Options Forfeited	5.14	12.40
Range of Exercise price, Options Outstanding	5.14	10.50
Range of exercise price, options exercisable (vested)	5.14	12.40
Range of exercise price, options non-exercisable (non-vested)	5.14	10.50
Range of Exercise price, Options Outstanding		57.50
Employees and Non-employee Service Provider [Member] \| Maximum [Member]
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items]
Range of Exercise price, Options Outstanding	51.30	14,657.50
Range of Exercise price, Options Forfeited	51.30	49.70
Range of Exercise price, Options Outstanding	51.30	51.30
Range of exercise price, options exercisable (vested)	51.30	50.13
Range of exercise price, options non-exercisable (non-vested)	$ 35.20	51.30
Range of Exercise price, Options Outstanding		$ 14,657.50

SCHEDULE OF ASSUMPTION USED IN BLACK-SCHOLES OPTION-PRICING METHOD (Details) - $ / shares	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Equity [Abstract]
Expected dividend yield	0.00%	0.00%
Expected stock-price volatility		102.00%
Risk-free interest rate, minimum		1.58%
Risk-free interest rate, maximum		1.67%
Expected average term of options (in years)		6 years
Share price		$ 1.05

SCHEDULE OF SHARE-BASED COMPENSATION EXPENSE (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Total	$ 906,145	$ 2,690,447
General and Administrative Expense [Member]
Total	807,980	2,329,418
Research and Development Expense [Member]
Total	$ 98,165	$ 361,029

SCHEDULE OF WARRANT ACTIVITY (Details) - $ / shares	6 Months Ended		12 Months Ended
SCHEDULE OF WARRANT ACTIVITY (Details) - $ / shares	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2022	Dec. 31, 2021
Non Compensatory Warrant Activity [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Number of Shares, Warrants Outstanding Beginning	547,003	554,914	554,914
Weighted Average Exercise Price Per Share Warrants Outstanding Beginning	$ 19.76	$ 20.10	$ 20.10
Weighted average remaining life (Years) exercisable			3 months 29 days
Number of shares, warrants granted		331,464
Weighted average exercise price per share warrants granted		$ 0.01
Number of Shares, Warrants Exercised
Weighted average exercise price per share warrants exercised
Number of Shares, Warrants Expired	(455,685)
Weighted average exercise price per share warrants expired	$ 20.00
Number of Shares, Warrants Forfeited
Weighted average exercise price per share warrants forfeited
Number of Shares, Warrants Outstanding Ending	91,318	886,378	547,003	554,914
Weighted Average Exercise Price Per Share Warrants Outstanding Ending	$ 18.56	$ 12.60	$ 19.76	$ 20.10
Number of Shares, Warrants Exercisable	91,318	886,378
Weighted Average Exercise Price Per Share Exercisable	$ 18.56	$ 12.60
Weighted average remaining life (Years) exercisable	6 months 29 days	9 months 25 days
Number of shares legal ritter warrants
Weighted average exercise price per share warrants expired	$ 20.00
Number of Shares, Warrants Exercisable
Weighted Average Exercise Price Per Share Exercisable
Range of exercise price, granted		0.01
Minimum [Member] \| Non Compensatory Warrant Activity [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Range of exercise price	1.32
Range of exercise price - ending			1.32
Range of exercise price - Exercisable	1.32	0.01
Maximum [Member] \| Non Compensatory Warrant Activity [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Range of exercise price	20.00
Range of exercise price - ending			$ 20.00
Range of exercise price - Exercisable	$ 20.00	$ 37.70
Compensatory Warrant Activity [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Number of Shares, Warrants Outstanding Beginning	179,046	179,065	179,065
Weighted Average Exercise Price Per Share Warrants Outstanding Beginning	$ 9.12	$ 15.20	$ 15.20
Weighted average remaining life (Years) exercisable	1 year 2 months 26 days	2 years 2 months 23 days	1 year 8 months 23 days	2 years 7 months 20 days
Number of shares, warrants granted
Weighted average exercise price per share warrants granted
Number of Shares, Warrants Exercised
Weighted average exercise price per share warrants exercised
Number of Shares, Warrants Expired
Weighted average exercise price per share warrants expired
Number of Shares, Warrants Forfeited
Weighted average exercise price per share warrants forfeited
Number of Shares, Warrants Outstanding Ending	179,046	179,065	179,046	179,065
Weighted Average Exercise Price Per Share Warrants Outstanding Ending	$ 9.12	$ 10.60	$ 9.12	$ 15.20
Number of Shares, Warrants Exercisable	179,046	179,065
Weighted Average Exercise Price Per Share Exercisable	$ 9.12	$ 10.60
Weighted average remaining life (Years) exercisable	1 year 2 months 26 days	2 years 2 months 23 days
Number of shares, warrants non-exercisable
Weighted Average Exercise Price Per Share Non-Exercisable
Range of Exercise Price, Non-Exercisable
Compensatory Warrant Activity [Member] \| Minimum [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Range of exercise price	1.32	11.10	11.10
Range of exercise price - ending	1.32	5.14	1.32	11.10
Range of exercise price - Exercisable	1.32	5.14
Compensatory Warrant Activity [Member] \| Maximum [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Range of exercise price	25.40	25.40	25.40
Range of exercise price - ending	25.40	25.40	$ 25.40	$ 25.40
Range of exercise price - Exercisable	$ 25.40	$ 25.40

STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($)						1 Months Ended	6 Months Ended		12 Months Ended
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($)	Jul. 20, 2023	Jan. 12, 2023	Dec. 22, 2022	May 26, 2022	Apr. 25, 2022	Dec. 31, 2020	Jun. 30, 2023	Jun. 30, 2022	Dec. 31, 2021	Dec. 31, 2022	May 31, 2022	Nov. 29, 2021	Aug. 31, 2020	Jul. 31, 2020	May 31, 2020	Dec. 31, 2017
Class of Stock [Line Items]
Conversion price		$ 1.32
Purchase of warrants									60,000
Debenture voluntarily converted		$ 1,111,078
Shares of common stock		841,726
Plan shares available							4,565,097
Compensation cost	$ 5,800,000						$ 906,145	$ 2,690,447
Unrecognized compensation cost							$ 500,000
Cost is expected to be recognized over a weighted average period							1 year 5 months 19 days
Purchase of warrants						219,101
Class of warrant or right, exercise						$ 40.70			$ 13.20
Fair value of issuance cost									$ 300,000
Fair value adjustment of warrants							$ (1,478,967)	(698,042)
Compensation cost							906,145	2,690,447
Nano Synex Ltd [Member]
Class of Stock [Line Items]
Purchase of warrants					7,048
Class of warrant or right, exercise			$ 1.32	$ 5.136	$ 11.10
Fair value adjustment of warrants			$ 891	$ 696	$ 2,533
Modified to exercise price					$ 6.00
General and Administrative Expense [Member]
Class of Stock [Line Items]
Compensation cost							807,980	2,329,418
Warrant [Member]
Class of Stock [Line Items]
Purchase of warrants					60,000
Purchase of warrants			67,620	67,619	67,619
Class of warrant or right, exercise					$ 6.00
Reverse stock split, price per share					$ 13.20
Warrants extended date description					June 3, 2023 to September 14, 2023
Fair value adjustment of warrants			$ 8,548
Warrant [Member] \| Minimum [Member]
Class of Stock [Line Items]
Class of warrant or right, exercise			$ 5.136	$ 11.10	$ 11.10
Warrant [Member] \| Maximum [Member]
Class of Stock [Line Items]
Class of warrant or right, exercise			$ 1.32	$ 5.136	$ 5.136
Warrant [Member] \| General and Administrative Expense [Member]
Class of Stock [Line Items]
Fair value adjustment of warrants					$ 67,370
Additional Paid-in Capital [Member] \| Warrant [Member]
Class of Stock [Line Items]
Fair value adjustment of warrants				$ 31,010
Compensatory Warrant Activity [Member]
Class of Stock [Line Items]
Compensation cost							$ 0	67,370
Equity Option [Member]
Class of Stock [Line Items]
Plan shares available							445,163
Equity Option [Member] \| 2020 Stock Incentive Plan [Member]
Class of Stock [Line Items]
Plan shares available							310,539			147,690
Options outstanding							445,163			608,012
Share-Based Compensation Arrangement by Share-Based Payment Award, Description							The exercise price for an option issued under the 2020 Plan is determined by the Board of Directors, but will be (i) in the case of an incentive stock option (A) granted to an employee who, at the time of grant of such option, is a 10% stockholder, no less than 110% of the fair market value per share on the date of grant; or (B) granted to any other employee, no less than 100% of the fair market value per share on the date of grant; and (ii) in the case of a non-statutory stock option, no less than 100% of the fair market value per share on the date of grant
Share-Based Payment Arrangement, Option [Member]
Class of Stock [Line Items]
Compensation cost							$ 900,000	$ 2,700,000
Compensatory Warrants [Member]
Class of Stock [Line Items]
Issuance or sale of equity							$ 4,000,000.0
Purchase of warrants							81,143									66,802
Class of warrant or right, exercise							$ 11.10									$ 23.40
Noncompensatory Equity Classified Warrants [Member]
Class of Stock [Line Items]
Purchase of warrants											331,464	27,048		192,068	27,048
Class of warrant or right, exercise											$ 0.01	$ 20.00		$ 52.50	$ 11.10
Fair value adjustment of warrants							$ 2,300,000
Warrants exercised						20,000
Number of outstanding warrants to purchase, shares												539,951
Noncompensatory Equity Classified Warrants [Member] \| Warrant [Member]
Class of Stock [Line Items]
Class of warrant or right, exercise												$ 11.10
Series C Warrants [Member]
Class of Stock [Line Items]
Class of warrant or right, exercise							$ 7.195
Alpha Capital [Member] \| Noncompensatory Equity Classified Warrants [Member]
Class of Stock [Line Items]
Purchase of warrants						100,000								78,019
Class of warrant or right, exercise						$ 0.10								$ 0.01
Alpha Capital [Member] \| Noncompensatory Equity Classified Warrants [Member] \| Warrant [Member]
Class of Stock [Line Items]
Purchase of warrants													128,783
Class of warrant or right, exercise													$ 60.00
Alpha Capital [Member] \| Series C Warrants [Member]
Class of Stock [Line Items]
Purchase of warrants			2,500,000
Class of warrant or right, exercise			$ 1.65
Alpha Capital [Member] \| Senior Convertible Debenture [Member]
Class of Stock [Line Items]
Senior convertible debenture rate			8.00%
Principal amount			$ 3,300,000
Purchase Price			$ 3,000,000
Conversion price			$ 1.32

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)				3 Months Ended	17 Months Ended
	Jan. 12, 2023	Dec. 22, 2022	May 26, 2022	Jun. 30, 2022	Sep. 02, 2021	Jun. 30, 2023	Dec. 31, 2022	Dec. 31, 2021	Dec. 31, 2020
Related Party Transaction [Line Items]
Conversion price	$ 1.32
Short term debt principal outstanding	$ 1,111,078
Shares of common stock	841,726
Short term debt outstanding balance						$ 965,155	$ 950,722
Accrued interest rate		8.00%
Warrants to purchase shares								60,000
Warrants exercise price								$ 13.20	$ 40.70
Stock issued during period value acquisitions				$ 1,844,500
Pre-funded Warrant [Member]
Related Party Transaction [Line Items]
Warrants to purchase shares			331,464
Warrants exercise price			$ 0.001
Series B Preferred Stock [Member]
Related Party Transaction [Line Items]
Stock issued during period shares acquisitions			381,786
NanoSynex Ltd [Member]
Related Party Transaction [Line Items]
Business acquisition, voting equity rate			52.80%
Stock issued during period shares acquisitions			350,000
NanoSynex Ltd [Member] \| Series A-1 Preferred Stock [Member]
Related Party Transaction [Line Items]
Stock issued during period shares acquisitions			2,232,861
NanoSynex Ltd [Member] \| Series B Preferred Stock [Member]
Related Party Transaction [Line Items]
Stock issued during period shares acquisitions			381,786
Stock issued during period value acquisitions			$ 600,000
Notes Payable [Member] \| Nano Synex Ltd [Member]
Related Party Transaction [Line Items]
Short term debt principal outstanding					$ 905,000
Short term debt outstanding balance						$ 965,155
Accrued interest rate					2.62%
Proceeds from related party debt					$ 3,000,000
Alpha Capital [Member] \| Senior Convertible Debenture [Member]
Related Party Transaction [Line Items]
Senior convertible debenture rate		8.00%
Principal amount		$ 3,300,000
Purchase Price		$ 3,000,000
Conversion price		$ 1.32

SUBSEQUENT EVENTS (Details Narrative) - USD ($)			3 Months Ended		6 Months Ended
SUBSEQUENT EVENTS (Details Narrative) - USD ($)	Jul. 20, 2023	Jul. 13, 2023	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022	Mar. 31, 2024	Nov. 30, 2023	Jan. 12, 2023	Dec. 31, 2022
Subsequent Event [Line Items]
Research and Development Expense			$ 1,326,544	$ 1,506,227	$ 3,448,095	$ 3,370,972
Cash	$ 5,200,000		1,341,659		1,341,659					$ 7,034,434
Escrow			$ 450,000		$ 450,000
Aggregrate amount									$ 1,111,078
Subsequent Event [Member]
Subsequent Event [Line Items]
Sale of stock price per share	$ 1.5716
Subsequent Event [Member] \| NanoSynex Ltd [Member]
Subsequent Event [Line Items]
Business acquisition, description of acquired entity	Pursuant to the terms of the NanoSynex Amendment, the Company agreed to advance to NanoSynex an aggregate amount of $1,610,000 as follows: (i) $380,000 within five business days of the execution of the NanoSynex Amendment, (ii) $560,000 on or before November 30, 2023, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding, and (iii) $670,000 on or before March 31, 2024, against which NanoSynex will issue a promissory note to the Company with a face value in the amount of such funding. The NanoSynex Amendment further provides that the initial payment of $380,000 will be satisfied by the Company’s surrender of the 281,000 Preferred B Shares of NanoSynex currently held by the Company, resulting in the Company’s ownership in NanoSynex being reduced from approximately 52.8% to approximately 49.97% of the issued and outstanding voting equity of NanoSynex.
Master Laboratory Services Agreement [Member] \| Subsequent Event [Member] \| MLM Medical Labs [Member]
Subsequent Event [Line Items]
Research and Development Expense		$ 7,600,000
Stock Purchase Agreement [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Cash	$ 5,200,000
Purchase Price	5,800,000
Escrow	450,000
Amendment and Settlement Agreement [Member] \| Subsequent Event [Member]
Subsequent Event [Line Items]
Aggregrate amount	380,000
Amendment and Settlement Agreement [Member] \| Subsequent Event [Member] \| NanoSynex Ltd [Member]
Subsequent Event [Line Items]
Aggregrate amount	$ 1,610,000						$ 670,000	$ 560,000