PMCB.NASDAQPharmacyte Biotech, INC
8-K/A: Q/C Technologies Faces Going Concern, Nasdaq Delisting
Sentiment:
Financial Results and Corporate Update
Q/C Technologies, formerly TNF Pharmaceuticals, reported significant net losses and negative cash flows, raising substantial doubt about its ability to continue as a going concern and facing a Nasdaq minimum bid price deficiency.
Delay expectedMonthly installment payments for Series F Preferred Stock due on March 1, 2024, and April 1, 2024, were deferred until May 1, 2024.Payment of accrued and unpaid Series F Preferred Shares installment amounts as of November 7, 2024, was deferred until December 1, 2024.The maturity date for Series F Preferred Stock was extended multiple times: first to December 31, 2024, then to June 30, 2025, and subsequently to December 31, 2025.The maturity date for Series F-1 Preferred Stock was extended to December 31, 2025.The term of Series F and Series F-1 Warrants was extended to August 15, 2030.
Capital raiseIn February 2023, the company sold 15,000 shares of Series F Convertible Preferred Stock and warrants, generating net proceeds of $14,685,689.In May 2024, the company sold 5,050 shares of Series F-1 Convertible Preferred Stock and warrants, generating net proceeds of $5,050,000.In May 2024, the company sold 8,950 shares of Series G Convertible Preferred Stock and warrants, generating net proceeds of $8,950,000.For the year ended December 31, 2024, the company raised $12,487,399, net of offering costs, through private placements of Series F-1 and Series G Preferred Stock and warrants.On September 4, 2025, PharmaCyte Biotech, Inc. purchased Series H convertible preferred stock and warrants from Q/C Technologies, Inc. for an aggregate purchase price of $3,000,000.Management expects to seek additional funding through private equity or debt financings to meet liquidity requirements.
Worse than expectedThe company reported a significantly higher net loss of $23,359,334 in 2024 compared to $3,999,950 in 2023.The accumulated deficit grew to $129,138,286 by December 31, 2024, and further to $133,849,089 by June 30, 2025, indicating continued operational losses.Cash and cash equivalents plummeted from $2,681,010 at the end of 2023 to $173,154 at the end of 2024, highlighting severe liquidity challenges.The company received a Nasdaq minimum bid price deficiency notice on March 17, 2025, indicating its stock price has fallen below the required $1.00 threshold for continued listing.Despite an improved net loss in the first half of 2025 compared to the prior year period, the company continues to incur negative cash flows from operations and explicitly states its dependence on additional capital financing to continue as a going concern.
Summary
- Q/C Technologies (formerly TNF Pharmaceuticals) reported a net loss of $23,359,334 for the year ended December 31, 2024, a significant increase from $3,999,950 in 2023.
- The net loss attributable to common stockholders worsened to $27,161,219 in 2024 from $8,218,163 in 2023, resulting in a basic and diluted net loss per common share of $(11.15) in 2024, compared to $(5.33) in 2023.
- Cash and cash equivalents decreased significantly to $173,154 at December 31, 2024, from $2,681,010 at December 31, 2023.
- The company incurred negative cash flows from operations of $8,976,347 in 2024, an improvement from $12,980,625 in 2023.
- For the six months ended June 30, 2025, the net loss was $2,920,938, a significant improvement from $19,365,689 for the same period in 2024.
- Cash and cash equivalents slightly increased to $207,553 at June 30, 2025, from $173,154 at December 31, 2024.
- The company received a Nasdaq letter on March 17, 2025, for not meeting the minimum bid price of $1.00, with a compliance period until September 15, 2025.
- PharmaCyte Biotech, Inc. invested $3,000,000 in Q/C Technologies on September 4, 2025, by purchasing Series H convertible preferred stock and warrants.
Sentiment
Score: 2
Explanation: The company faces severe financial challenges, including substantial doubt about its ability to continue as a going concern, persistent and significant net losses, and a Nasdaq delisting threat. While capital has been raised, it appears to be a continuous necessity rather than a definitive solution, and existing equity holders face significant dilution.
Positives
- Operating loss improved to $(10,168,790) in 2024 from $(17,123,052) in 2023.
- Research and Development Expenses decreased significantly to $3,441,010 in 2024 from $7,867,795 in 2023.
- Net cash used in operating activities improved to $(8,976,347) in 2024 from $(12,980,625) in 2023.
- Net loss for the six months ended June 30, 2025, significantly improved to $(2,920,938) from $(19,365,689) in the prior year period.
- Basic and diluted loss per common share for the six months ended June 30, 2025, improved to $(0.45) from $(9.58) in the prior year period.
- Successful capital raises in 2024 through Series F-1 and Series G Preferred Stock and warrants, totaling $12,487,399 net.
- Reclassification of Series F, F-1, and G warrant liabilities to equity in 2024, reducing reported liabilities.
- PharmaCyte Biotech, Inc. made a $3,000,000 investment in Q/C Technologies in September 2025.
Negatives
- Substantial doubt exists about the company's ability to continue as a going concern for both 2024 and 2025 periods.
- Significant net loss of $23,359,334 in 2024, worsening from $3,999,950 in 2023.
- Accumulated deficit increased to $129,138,286 at December 31, 2024, and further to $133,849,089 at June 30, 2025.
- Cash and cash equivalents decreased from $2,681,010 at December 31, 2023, to $173,154 at December 31, 2024.
- Nasdaq minimum bid price deficiency notice received on March 17, 2025, with a compliance deadline of September 15, 2025.
- Significant losses on issuance of Series F-1 ($3,737,000) and Series G ($5,109,000) Convertible Preferred Stock in 2024.
- Derivative liabilities increased significantly to $1,303,000 at December 31, 2024, from $61,000 at December 31, 2023.
- Negative cash flows from operations continued in the six months ended June 30, 2025, at $(4,705,607).
- No product revenue generated in any reported period.
- Significant anti-dilution adjustments to conversion/exercise prices of preferred stock and warrants, reducing them to $0.364 per share (March 5, 2025) and then $0.1832 per share (April 17, 2025).
Risks
- Substantial doubt exists about the company's ability to continue as a going concern due to historical net losses and negative cash flows from operations.
- The company's current financial resources are not sufficient to fund its operating budget and contractual obligations for the next twelve months without additional capital.
- The company received a notice of non-compliance with Nasdaq's minimum bid price rule ($1.00 per share) and faces potential delisting if compliance is not regained by September 15, 2025.
- Future equity financings, which are necessary for continued operations, would result in dilution to existing stockholders.
- Significant judgment is required in estimating the fair value of preferred stock and embedded derivative liabilities, and changes in market conditions or assumptions could lead to significant fluctuations.
- The assessment of goodwill impairment involves significant management judgment, especially given the company's pre-revenue status, reliance on R&D, and low market capitalization relative to book value.
- The investment in Oravax Medical, Inc. is assessed qualitatively for impairment, and significant management judgment is involved in this assessment.
- Ongoing legal proceedings, such as the Raymond Akers Actions, could have an adverse impact on financial condition or results of operations.
- As a pre-revenue company, its success is highly dependent on the outcome of ongoing research and development activities for its product candidate, Isomyosamine.
Future Outlook
Management believes its financial resources as of April 11, 2025, were sufficient to fund its operating budget and contractual obligations for the subsequent twelve months. However, as of June 30, 2025, the company's ability to continue as a going concern is dependent on obtaining additional capital financing. The recently enacted Taxpayer Fairness and Growth Act of 2025 is expected to reduce the federal corporate income tax rate to 19% from 21% starting January 1, 2026, which could favorably impact the effective tax rate, though remeasurement of deferred tax balances may result in non-cash tax charges.
Management Comments
- Management concluded that as of December 31, 2024, there were material uncertainties related to events or conditions that may cast significant doubt upon the company's ability to continue as a going concern, despite also stating that current financial resources were believed to be sufficient to fund operating budget and contractual obligations for the subsequent twelve-month period from the issuance date of the 2024 financial statements (April 11, 2025).
- As of June 30, 2025, the company's ability to continue as a going concern for the next 12 months is dependent upon its ability to obtain additional capital financing.
- Management intends to protect all other intellectual property (e.g., copyrights, trademarks, and trade secrets) using all legal remedies available.
Industry Context
Q/C Technologies operates in the highly competitive and capital-intensive biotechnology and pharmaceutical industry, focusing on developing Isomyosamine, an oral, next-generation TNF-inhibitor. As a pre-revenue company, its financial health is heavily reliant on successful research and development and continuous capital infusion, a common challenge for early-stage biotech firms. The product candidate aims to differentiate itself through oral dosing and selective TNF-alpha and IL-6 inhibition, potentially addressing a significant market in inflammatory diseases like rheumatoid arthritis, where current treatments often require injections.
Comparison to Industry Standards
- The company's pre-revenue status and reliance on ongoing research and development activities are typical for early-stage biotechnology companies, but the magnitude of its accumulated deficit ($133.8 million as of June 30, 2025) and persistent net losses are concerning compared to industry peers that may show clearer paths to commercialization or more robust financing.
- The repeated need for capital raises through complex preferred stock and warrant issuances, coupled with significant anti-dilution adjustments, suggests a challenging financing environment and potentially less favorable terms than those secured by more established or clinically advanced biotech firms.
- The Nasdaq minimum bid price deficiency is a common issue for smaller, pre-revenue companies, but it adds a layer of regulatory risk that larger, more stable pharmaceutical companies typically do not face.
Management Changes
| Role | Previous Person | New Person | Effective Date | Reason |
|---|---|---|---|---|
| President and Chief Medical Officer | Dr. Chris Chapman | N/A | June 14, 2024 | Employment terminated, severance package provided. |
| Chief Scientific Officer | Dr. Adam Kaplin | N/A | April 15, 2024 | Employment terminated. |
| Chief Legal Officer | Paul M. Rivard | N/A | November 13, 2023 | Mutual employment separation agreement. |
| Director | N/A | Dr. Mitchell Glass | April 8, 2024 | Elected by holders of Series F Preferred Shares. |
| Director | N/A | Required Holder Nominee | N/A | Required Holder entitled to nominate one director to the board as per August 19, 2025 Amendment Agreement. |
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Reincorporation | Changed state of incorporation from New Jersey to Delaware. | March 4, 2024 | Governed by Delaware General Corporation Law, no change in name, business, management, fiscal year, accounting, principal executive offices, assets or liabilities. |
| Authorized Share Capital Increase | Increased authorized common stock from 16,666,666 to 250,000,000 shares. | July 25, 2024 | Provides flexibility for future equity issuances, potentially increasing dilution. |
| Authorized Share Capital Increase | Increased authorized common stock from 250,000,000 to 1,250,000,000 shares. | June 6, 2025 | Further increases flexibility for future equity issuances, potentially leading to significant dilution. |
| Board Size Reduction | Agreed to reduce the size of the board of directors to no more than six directors. | By 2025 annual meeting of stockholders | Potential streamlining of governance, but could concentrate power. |
| Director Nomination Right | Required Holder of Series F/F-1 Preferred Stock is entitled to nominate one director to the board. | August 19, 2025 | Increases influence of preferred stockholders on board composition. |
Legal Proceedings
- Raymond F. Akers, Jr., Ph.D. filed two lawsuits (First and Second Raymond Akers Actions) against the company, asserting common law whistleblower retaliation claims. The Second Raymond Akers Action is in the discovery phase as of June 30, 2025. The company does not believe this litigation will have a material impact on its financial condition or results of operations.
Related Party Transactions
- The company has royalty agreements with SRQ Patent Holdings and SRQ Patent Holdings II, affiliates of former significant stockholder Mr. Jonnie Williams, Sr., obligating 8% royalties on product sales or other revenue. No revenue has been recognized subject to these agreements.
- A limited license agreement with MIRA Pharmaceuticals, Inc. (Nasdaq: MIRA) involves sharing technical information for Supera-CBD and MIRA1a product candidates.
- The company's Chairman of the Board, Joshua Silverman, also serves as the interim CEO, President, and Director of PharmaCyte Biotech, Inc., which is an investor in the company's Series G and Series H Preferred Stock.
Stakeholder Impact
- Shareholders face significant dilution risk from ongoing and future capital raises, potential loss of investment due to going concern doubts, and risk of Nasdaq delisting impacting liquidity and share value.
- Employees experienced a reduction in workforce in October and November 2023, and executive employment terminations in 2024, indicating job insecurity.
- Creditors/Preferred Stockholders have significant influence through voting rights, anti-dilution provisions, and redemption rights, and have extended maturity dates, indicating a degree of control and protection for their investment, but also face the overall going concern risk.
- No direct impact on customers or suppliers is mentioned, as the company is pre-revenue.
Next Steps
- Regain compliance with Nasdaq's minimum bid price requirement by September 15, 2025.
- Obtain additional capital financing through private equity or debt to fund operations.
- Reduce the size of the board of directors to no more than six directors by the 2025 annual meeting of stockholders.
- Evaluate the impact of the Taxpayer Fairness and Growth Act of 2025 on consolidated financial statements and recognize adjustments in the period of enactment.
Key Dates
| Date | Description |
|---|---|
| 2010 | Morison Cogen LLP served as the Company's auditor from 2010 to 2024. |
| April 14, 2021 | Raymond F. Akers, Jr., Ph.D. filed the First Raymond Akers Action lawsuit against the Company. |
| October 14, 2021 | Compensation Committee approved grants totaling 93,169 Restricted Stock Units to directors and key employees. |
| November 17, 2021 | 2021 Baltimore Lease took effect. |
| March 1, 2022 | Dr. Akers filed the Second Raymond Akers Action lawsuit against the Company. |
| May 27, 2022 | Court granted-in-part and denied-in-part the Company's Motion to Dismiss Plaintiffs Complaint in the Second Raymond Akers Action. |
| June 27, 2022 | Company entered into an Amended and Restated Limited License Agreement with MIRA Pharmaceuticals, Inc. |
| July 29, 2022 | Company filed its Answer, including affirmative defenses, in the Second Raymond Akers Action. |
| November 30, 2022 | Initial term of 2021 Baltimore Lease expired. |
| December 1, 2022 | 2021 Baltimore Lease renewed for 12 months. |
| February 21, 2023 | Company sold 15,000 shares of Series F Convertible Preferred Stock and warrants (February 2023 Offering). |
| April 4, 2023 | Company issued 25,000 options to a key employee. |
| April 20, 2023 | Amended Limited License Agreement with MIRA Pharmaceuticals, Inc. |
| June 7, 2023 | Company issued 66,503 options to directors and key employees. |
| July 1, 2023 | Series F Preferred Shares initially required monthly installment redemptions to commence. |
| July 19, 2023 | Company issued 1,667 options to a consultant. |
| July 31, 2023 | Stockholders approved a plan to merge the Company into MyMD Delaware for reincorporation. |
| August 1, 2023 | Purchase Agreements required the Company to hold a stockholder meeting by this date to seek approval for share issuances. |
| September 6, 2023 | Company issued 33,334 options to a key employee and 3,334 options to another key employee. |
| October 2023 | Company implemented a reduction in workforce. |
| November 2023 | Company implemented a reduction in workforce. Board approved adjustments to director fees. |
| November 13, 2023 | Amendment to employment agreement of Dr. Chris Chapman, Christopher C. Schreiber, and Dr. Adam Kaplin. Mutual employment separation agreement with Paul M. Rivard. |
| February 14, 2024 | Company effected a 1-for-30 reverse stock split. |
| March 1, 2024 | Monthly installment amounts due on Series F Preferred Stock deferred until May 1, 2024. |
| March 4, 2024 | Reincorporation to Delaware effected. |
| April 1, 2024 | Monthly installment amounts due on Series F Preferred Stock deferred until May 1, 2024. Morison Cogen LLP's report dated. |
| April 5, 2024 | Company entered into an Omnibus Waiver and Amendment with Series F Required Holders. |
| April 8, 2024 | Amended and Restated Certificate of Designations of Series F Convertible Preferred Stock became effective. Dr. Mitchell Glass appointed to the board. |
| April 15, 2024 | Dr. Adam Kaplin's employment terminated. |
| April 30, 2024 | 2021 Baltimore Lease terminated by lessor. |
| May 1, 2024 | 2024 Baltimore Lease took effect. |
| May 14, 2024 | Company entered into Series F Warrant Amendment, effective March 31, 2024. |
| May 20, 2024 | Company entered into Omnibus Waiver, Consent, Notice and Amendment (Series F Agreement) with Series F Required Holders. Company entered into Securities Purchase Agreements for Series F-1 and Series G Private Placements. |
| May 23, 2024 | Closing of Series F-1 and Series G Private Placements. |
| June 17, 2024 | Company entered into Series G Amendment and filed Certificate of Amendment to Series G Certificate of Designations. |
| July 22, 2024 | Company changed its name from MyMD Pharmaceuticals, Inc. to TNF Pharmaceuticals, Inc. |
| July 24, 2024 | Company's common stock began trading under ticker TNFA. Stockholders approved Share Increase. Company received Nasdaq Stockholder Approval. |
| July 25, 2024 | Company increased authorized common stock to 250,000,000 shares. Series F-1 Warrants and Series G Warrants reclassified to equity. |
| August 8, 2024 | Company entered into August Series G Amendment and filed Certificate of Amendment to Series G Certificate of Designations. |
| August 12, 2024 | Registration statement on Form S-3 declared effective by SEC. |
| August 16, 2024 | Company entered into Series F-1 and Series G Warrant Amendments, effective June 30, 2024. |
| November 7, 2024 | Series F Preferred Shares holders agreed to defer installment payments until December 1, 2024. |
| December 1, 2024 | Series F-1 Preferred Stock initially required monthly installment redemptions to commence. |
| December 31, 2024 | Series F Preferred Stock maturity date extended to this date. |
| January 1, 2025 | Aggregate Stated Value of Series F Preferred Stock to increase to 110% (subject to stockholder approval). |
| January 30, 2025 | Start of 30-day period for Nasdaq minimum bid price deficiency. |
| February 26, 2025 | Company provided notice of intention not to renew 2024 Baltimore Lease. |
| March 5, 2025 | Series F, F-1, and G conversion/exercise prices adjusted to $0.364 per share due to anti-dilution. |
| March 14, 2025 | End of 30-day period for Nasdaq minimum bid price deficiency. |
| March 17, 2025 | Company received Nasdaq minimum bid price deficiency letter. |
| April 8, 2025 | Company entered into Omnibus Amendment Agreement (April 2025 Amendment Agreement) with Required Holders, amending Series F and F-1 Certificates of Designations and Series F-1 Purchase Agreement. Stephano Slack LLC's report dated. |
| April 11, 2025 | Date of issuance of the consolidated financial statements for the year ended December 31, 2024. |
| April 17, 2025 | Series F, F-1, and G conversion/exercise prices adjusted to $0.1832 per share due to anti-dilution. |
| April 30, 2025 | 2024 Baltimore Lease effective non-renewal date. |
| May 20, 2025 | Annual meeting of stockholders reconvened to June 3, 2025. |
| June 3, 2025 | Stockholders approved Share Increase Amendment. |
| June 6, 2025 | Company filed Share Increase Amendment, increasing authorized common stock to 1,250,000,000 shares. |
| June 30, 2025 | Series F Preferred Stock maturity date extended to this date. |
| July 2, 2025 | United States Congress enacted the Taxpayer Fairness and Growth Act of 2025. |
| August 19, 2025 | Company entered into Omnibus Amendment Agreement (August 2025 Amendment Agreement) with Required Holders, amending Series F and F-1 Certificates of Designations and extending warrant terms. |
| September 2, 2025 | PharmaCyte Biotech, Inc. entered into Securities Purchase Agreement with Q/C Technologies, Inc. |
| September 4, 2025 | Closing of PharmaCyte Biotech's Transaction with Q/C Technologies, Inc. |
| September 15, 2025 | Nasdaq compliance period deadline for minimum bid price. |
| December 31, 2025 | Series F and F-1 Preferred Stock maturity date extended to this date. |
| January 1, 2026 | Federal corporate income tax rate reduction from 21% to 19% effective. |
| August 15, 2030 | New expiration term for Series F and F-1 Warrants. |
Recommendation
strong sellThe company's financial position is extremely precarious, marked by substantial doubt about its ability to continue as a going concern, persistent and escalating net losses, and critically low cash reserves. The Nasdaq minimum bid price deficiency poses an imminent delisting threat, which would severely impact liquidity and investor confidence. While recent capital raises provide temporary relief, they come with significant dilution and complex terms, indicating a continuous need for external funding without a clear path to profitability. The high accumulated deficit and pre-revenue status further underscore the fundamental business challenges. Seasoned investors would likely view this as a high-risk, speculative investment with a strong likelihood of further value erosion.
Keywords
TNF Pharmaceuticals, Q/C Technologies, MyMD Pharmaceuticals, Isomyosamine, biotechnology, pharmaceuticals, SEC filing, financial results, net loss, going concern, Nasdaq compliance, capital raise, preferred stock, warrants, anti-dilution, corporate governance, risk management, drug development, TNF inhibitor, inflammation, rheumatoid arthritis
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