10-Q: Polomar Health Services Reports Deepening Losses

Sentiment:

Quarterly Report 19 August 2025 5:30 PM

📋All filings for Polomar Health Services, INC

Polomar Health Services, Inc. reported a significant increase in net loss and continued going concern doubts for the six months ended June 30, 2025, despite strategic shifts and new product initiatives.

Delay expectedThe SlimRx™ trademark application received an Office Action Letter from the USPTO on April 27, 2025, and the company received an extension of time to respond until October 24, 2025, indicating a delay in securing trademark protection.The CWR Note II and Profesco Note, both related party loans, mature on October 31, 2025, and will incur higher interest rates (prime + 7%) if not paid in full by then, suggesting potential delays in securing long-term financing or generating sufficient cash flow to repay these short-term obligations.

Capital raiseThe company explicitly states that its ability to continue as a going concern is dependent on its ability to generate revenues and raise capital, and management plans to raise additional capital over the next twelve months.The company has historically raised working capital through related party debt and issuance of restricted common stock.New Promissory Note and Loan Agreement with CWR (CWR Note II) for up to $150,000, with an initial draw of $60,000, entered into on July 21, 2025.New Promissory Note and Loan Agreement with Profesco Holdings, LLC for up to $100,000, with draws totaling $87,378.46, entered into on July 28, 2025.The Agreement and Plan of Merger and Reorganization with Altanine Inc. on July 23, 2025, is a significant capital restructuring event, as former Altanine stockholders are expected to own approximately 80% of the combined company, effectively a reverse merger for capital and business assets.

Worse than expectedNet loss significantly widened to $1,062,418 for the six months ended June 30, 2025, from $351,210 in the prior year, indicating a worsening financial performance.Revenue decreased substantially to $10,011 from $28,105, reflecting a significant decline in sales.Operating expenses increased by 171%, indicating a lack of cost control or significant investment without corresponding revenue growth.Cash on hand remains critically low at $4,678, highlighting severe liquidity issues.The company explicitly states 'substantial doubt exists about the Company's ability to continue as a going concern,' which is a critical negative indicator.

Summary

Polomar Health Services, Inc. (formerly Trustfeed Corp.) is transitioning its business model to focus on compounding pharmacy services, including specialty medications and telehealth platforms.
The company operates Polomar Specialty Pharmacy, LLC, licensed in Florida and authorized to fulfill prescriptions in 28 states, with plans to expand to a majority of U.S. states by end of 2025.
New online platforms, SlimRx™ (weight loss) and PoloMeds™ (diabetes, ED, dermatology), are expected to launch in Q4 2025.
The company reported a net loss of $1,062,418 for the six months ended June 30, 2025, a substantial increase from $351,210 for the same period in 2024.
Revenue decreased to $10,011 for the six months ended June 30, 2025, from $28,105 in the prior year period, primarily due to the post-merger transition to an online business model.
Operating expenses surged by approximately 171% to $985,755 for the six months ended June 30, 2025, driven by legal, professional, accounting fees, amortization, payroll, and stock-based compensation.
As of June 30, 2025, cash on hand was critically low at $4,678, and the company had an accumulated deficit of $3,973,581.
Management has identified substantial doubt about the company's ability to continue as a going concern, citing insufficient revenues and dependence on raising additional capital.
The company entered into a Product Fulfillment and Distribution Agreement with ForHumanity, Inc., granting exclusive marketing rights for inhalable sildenafil and sumatriptan in exchange for a guaranteed payment of $750,000.
A significant merger agreement with Altanine Inc. was announced on July 23, 2025, where former Altanine stockholders are expected to own approximately 80% of the combined company, indicating substantial dilution for current Polomar shareholders.
The company continues to rely on related party loans for working capital, including new promissory notes with CWR 1, LLC and Profesco Holdings, LLC (an affiliate of the interim CEO) totaling up to $250,000, maturing by October 31, 2025.

Sentiment

Score: 2

Explanation: The sentiment is highly negative due to significant financial losses, extremely low cash reserves, explicit going concern doubt, and heavy reliance on short-term, high-interest related party financing. While strategic initiatives and a major merger are underway, the immediate financial health is precarious, and the Altanine merger implies substantial dilution for existing shareholders.

Positives

The company is actively expanding its compounding pharmacy licenses, aiming to operate in a majority of U.S. states by the end of 2025.
New telehealth platforms, SlimRx™ and PoloMeds™, are planned for launch in Q4 2025, indicating strategic growth initiatives in the digital health sector.
A Product Fulfillment and Distribution Agreement with ForHumanity, Inc. includes a guaranteed payment of $750,000 and potential for significant sales revenue from licensed products.
Net cash used in operating activities decreased to $233,357 for the six months ended June 30, 2025, compared to $412,671 in the prior year, indicating a reduction in cash burn from operations.
Working capital deficit improved to $(943,867) as of June 30, 2025, from $(1,260,965) as of June 30, 2024.

Negatives

The company reported a significantly increased net loss of $1,062,418 for the six months ended June 30, 2025, compared to $351,210 for the same period in 2024.
Revenue declined substantially to $10,011 for the six months ended June 30, 2025, from $28,105 in the prior year period.
Operating expenses increased by approximately 171% to $985,755 for the six months ended June 30, 2025.
Cash on hand is extremely low at $4,678 as of June 30, 2025, raising immediate liquidity concerns.
The accumulated deficit grew to $3,973,581 as of June 30, 2025.
Substantial doubt exists about the company's ability to continue as a going concern due to a history of losses and insufficient cash flows.
The company is heavily reliant on related party loans for working capital, which may not be sustainable long-term.
The intellectual property licensed from Pinata Holdings, Inc. is patent-pending, not granted, and the license is non-exclusive and terminable on 180 days' notice, introducing uncertainty to its value.
Disclosure controls and procedures were deemed not effective as of December 31, 2024, due to inadequate segregation of duties, ineffective risk assessment, and insufficient written policies for accounting and financial reporting.

Risks

Uncertainty of profitability due to a history of losses.
Risk of failure to obtain adequate financing on a timely basis and on acceptable terms to continue as a going concern.
Operational risks and uncertainties related to the new business plan and strategy.
Uncertainty regarding intellectual property rights, including obtaining patent protection and defending against infringement claims.
Competition in the compounding pharmacy and telehealth sectors.
Cybersecurity concerns related to online platforms and patient data.
Reliance on related party financing, which may not be a stable or long-term funding source.
Potential for significant dilution of current shareholders due to future capital raises or mergers, such as the Altanine merger where existing shareholders are expected to own only 20% of the combined entity.

Future Outlook

The company expects to expand its prescription fulfillment capabilities to a majority of U.S. states by the end of 2025 and anticipates applying for a drug export permit in Q4 2025. It plans to launch its SlimRx™ telehealth platform and PoloMeds™ platform in early Q4 2025. The wholesale prescription fulfillment business is expected to experience steady growth over the next 12 to 18 months. Management plans to raise additional capital and invest working capital in its existing business and other potential opportunities over the next twelve months. The recently announced merger with Altanine Inc. is expected to result in former Altanine stockholders owning approximately 80% of the combined entity, significantly altering the company's future capital structure and business focus.

Management Comments

Management believes that the IP rights licensed from Pinata Holdings, Inc. will positively affect the company's revenue during the term of the agreement.
Management anticipates that the use of the IP Rights could result in significant gross revenues from the sale of products utilizing the IP Rights.
Management evaluated all relevant conditions and events and determined that substantial doubt exists about the company's ability to continue as a going concern.
Management plans to raise additional capital and to invest its working capital resources in its newly acquired business from Polomar and in other potential business opportunities over the next twelve months.
Management acknowledges that there is no guarantee the company will raise sufficient capital to continue operations.

Industry Context

Polomar Health Services is pivoting into the rapidly evolving compounding pharmacy and telehealth sectors, which are experiencing growth driven by demand for personalized medicine and convenient healthcare access. The focus on weight loss medications (semaglutide) and other specialty compounds aligns with current market trends. However, the industry is highly regulated, and competition is intense, particularly from larger, established pharmaceutical companies and telehealth providers. The company's reliance on patent-pending intellectual property and related-party financing suggests it is an early-stage player attempting to establish a foothold in a capital-intensive and competitive market.

Management Changes

Role	Previous Person	New Person	Effective Date	Reason
Treasurer and Chief Financial Officer	Terrence M. Tierney	Charlie Lin	2025-04-10	Appointment of Charlie Lin, current Controller, to the role; Terrence M. Tierney resigned from these specific positions but remains President and Director.

Corporate Governance

Change Type	Description	Effective Date	Impact Assessment
Internal Control Weaknesses	Disclosure controls and procedures were not effective as of December 31, 2024, due to inadequate segregation of duties, ineffective risk assessment, and insufficient written policies and procedures for accounting and financial reporting.	2024-12-31	These material weaknesses increase the risk of material misstatements in financial reporting not being prevented or detected on a timely basis. No changes in internal control over financial reporting occurred during the six months ended June 30, 2025, that materially affected or are reasonably likely to materially affect them.
Board Compensation Structure	New Director Services Agreements were entered into with David Spiegel, Gabe Del Virginia, and Terrence M. Tierney, providing annual compensation of $35,000 in restricted shares of common stock.	2025-05-07	Formalizes director compensation, aligning director interests with shareholder value through stock-based awards, but also contributes to stock-based compensation expense and potential dilution.

Related Party Transactions

Reprise Management, Inc. (an affiliate of Daniel Gordon, who controls CWR) provided a Promissory Note and Loan Agreement (Reprise Note) to Polomar Specialty Pharmacy, LLC. As of June 30, 2025, $808,875.30 principal plus $88,674.44 accrued interest was outstanding. $300,000 of this was exchanged for 60 shares of Series A Convertible Preferred Stock on June 30, 2025. The remaining balance of $597,549.74 is due by July 31, 2027, at 12% annual interest.
CWR 1, LLC (an affiliate of Daniel Gordon) provided a Promissory Note and Loan Agreement (CWR Note). As of June 30, 2025, $450,000 principal (inclusive of interest) was outstanding. This note was exchanged for 90 shares of Series A Convertible Stock on July 2, 2025, and considered paid in full.
Daniel Gordon, an affiliate, personally loaned the company $10,000 on January 31, 2025, which was repaid in full by April 1, 2025.
A new Promissory Note and Loan Agreement (CWR Note II) was entered into with CWR 1, LLC on July 21, 2025, allowing draws up to $150,000, with an initial draw of $60,000. It matures on October 31, 2025, at 12% APR, increasing to prime + 7% if not paid.
A Promissory Note and Loan Agreement (Profesco Note) was entered into with Profesco Holdings, LLC on July 28, 2025, allowing draws up to $100,000, with draws totaling $87,378.46. Terrence M. Tierney, the company's interim CEO, President, and Secretary, is the sole member and manager of Profesco Holdings, LLC. This note also matures on October 31, 2025, at 12% APR, increasing to prime + 7% if not paid.
The Know How and Patent License Agreement with Pinata Holdings, Inc. (an affiliate of CWR) involves royalty payments ranging from 10% to 20% of net sales from products utilizing the licensed IP Rights.

Stakeholder Impact

**Shareholders**: Significant dilution is expected from the Altanine merger, where current shareholders will own only ~20% of the combined entity. Continued losses and going concern doubt pose substantial risk to investment value. Reliance on related party debt and stock-based compensation for directors also impacts shareholder equity.
**Employees**: The company's ability to continue as a going concern directly impacts job security. The increase in payroll expenses suggests some investment in personnel, but overall financial instability remains a concern.
**Customers**: The expansion of pharmacy licenses and launch of new telehealth platforms (SlimRx™, PoloMeds™) could offer new services and broader access to compounded medications.
**Creditors**: Related party lenders are providing critical financing, but the short maturity dates and high interest rates on new notes indicate high risk. Unsecured creditors face significant risk given the company's precarious financial position and going concern doubt.
**Suppliers**: The company's liquidity issues and going concern doubt could pose risks to suppliers regarding timely payments.

Next Steps

Expand prescription fulfillment capabilities to a majority of U.S. states by the end of 2025.
Apply for a drug export permit in the fourth quarter of 2025.
Launch SlimRx™ telehealth platform in early Q4 2025.
Launch PoloMeds™ platform during the fourth quarter of 2025.
Respond to the USPTO's Office Action Letter regarding the SlimRx trademark application by October 24, 2025.
Raise additional capital to fund operations and invest in business opportunities over the next twelve months.
Complete the merger with Altanine Inc., which is expected to result in former Altanine stockholders owning approximately 80% of the combined company.

Key Dates

Date	Description
2023-12-29	Fastbase sold its shares in Trustfeed Corp. to CWR 1, LLC, resulting in a change of control and the suspension of the Pre-Existing Business operations.
2024-03-21	Brett Rosen resigned from all officer and director positions and was replaced by Terrence M. Tierney.
2024-06-29	Trustfeed executed a Know How and Patent License Agreement with Pinata Holdings, Inc., later restated and amended on January 9, 2025.
2024-07-18	Gabe Del Virginia was appointed to the Board of Directors.
2024-08-13	Polomar Specialty Pharmacy, LLC entered into a Promissory Note and Loan Agreement with Reprise Management, Inc. (Reprise Note).
2024-08-16	The company entered into a Promissory Note and Loan Agreement with CWR 1, LLC (CWR Note).
2024-08-29	Application for statutory trademark protection with the USPTO for SlimRx was filed.
2024-09-30	The merger transaction with Polomar was completed and deemed effective, resulting in a reverse recapitalization.
2024-10-01	David Spiegel was appointed to the Board of Directors.
2024-10-09	CWR 1, LLC returned 50,000,000 common shares for cancellation as per the Merger Agreement.
2024-10-10	The company filed Amended and Restated Articles of Incorporation to change its name to Polomar Health Services, Inc., increase authorized preferred shares, and effect a 1-for-10 reverse stock split.
2024-11-01	The 1-for-10 reverse stock split was effected, and the 2024 Equity and Incentive Compensation Plan was adopted.
2024-11-08	The Reprise Note was amended.
2024-12-12	The company's trading symbol was changed from TRFE to PMHS.
2025-01-09	The Know How and Patent License Agreement with Pinata Holdings, Inc. was restated and amended.
2025-01-31	Daniel Gordon personally loaned the company $10,000, which was repaid in full by April 1, 2025.
2025-03-11	The company executed a Product Fulfillment and Distribution Agreement with ForHumanity, Inc., effective March 12, 2025, and amended on March 17, 2025.
2025-04-10	Charlie Lin was appointed Treasurer and Chief Financial Officer; Terrence M. Tierney resigned from these positions.
2025-04-27	The USPTO issued an Office Action Letter regarding the SlimRx trademark application.
2025-05-07	The company entered into Board of Directors Services Agreements with David Spiegel and Gabe Del Virginia.
2025-05-15	The company issued 91,688 shares of fully vested stock to Mr. Del Virginia.
2025-06-21	The company entered into a Board of Directors Services Agreement with Terrence M. Tierney.
2025-06-25	The company issued 70,784 shares of fully vested stock to Mr. Spiegel.
2025-06-27	The company issued 91,677 shares of fully vested restricted stock to Mr. Del Virginia.
2025-06-30	Lender exchanged $300,000 of the Reprise Note for 60 shares of Series A Convertible Preferred Stock. The CWR Note was exchanged for 90 shares of Series A Convertible Stock and considered paid in full.
2025-07-02	The Reprise Note was amended, setting the remaining principal balance of $597,549.74 due by July 31, 2027. The CWR Note was amended, and the lender exchanged the note for 90 shares of Series A Convertible Stock.
2025-07-15	The company issued additional restricted common stock to Gabriel Del Virginia (8,333 shares), Terrence Tierney (8,333 shares), and David Spiegel (8,400 shares).
2025-07-21	The company entered into a new Promissory Note and Loan Agreement with CWR (CWR Note II) for up to $150,000, with an initial draw of $60,000.
2025-07-23	The company entered into an Agreement and Plan of Merger and Reorganization with Altanine Inc. (Altanine Merger).
2025-07-28	The company executed Addendum #3 to the Professional Services Agreement with Profesco, Inc. and Terrence M. Tierney, extending it through August 31, 2025. The company also entered into a Promissory Note and Loan Agreement with Profesco Holdings, LLC (Profesco Note) for up to $100,000, with draws totaling $87,378.46.
2025-08-15	The company issued additional restricted common stock to Gabriel Del Virginia (8,333 shares), Terrence Tierney (7,695 shares), and David Spiegel (8,400 shares).
2025-08-18	Latest practicable date for common shares outstanding (27,945,130 shares).
2025-10-24	Deadline to respond to the USPTO's Office Action Letter regarding the SlimRx trademark application.
2025-10-31	Maturity date for the CWR Note II and the Profesco Note.
2027-07-31	Maturity date for the remaining principal balance of the Reprise Note.

Recommendation

strong sell

The company faces severe financial distress, evidenced by a widening net loss, declining revenue, critically low cash reserves, and an explicit 'going concern' warning. Its reliance on short-term, high-interest related party loans is unsustainable. While the Altanine merger offers a potential lifeline, it comes at the cost of massive dilution for existing shareholders (expected to own only 20% of the combined entity). The material weaknesses in internal controls further compound the risk. For a seasoned investor, the current financial state and the terms of the Altanine merger present an extremely high-risk profile with significant downside potential for current equity holders, warranting a strong sell recommendation.

Keywords

Compounding Pharmacy, Telehealth, Weight Loss Medications, Semaglutide, Metformin, Erectile Dysfunction, Dermatology, SEC Filing, Quarterly Report, Going Concern, Related Party Transactions, Merger, Altanine, PMHS

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