10-Q: Regenerex Pharma Q2 Loss Widens Amid Zero Revenue, Going Concern Doubt

Regenerex Pharma reported a significantly increased net loss and substantial cash burn for the six months ended September 30, 2025, with zero revenue, raising substantial doubt about its ability to continue as a going concern.

Summary

• Net loss for the six months ended September 30, 2025, increased to $1,477,596, up from $802,132 for the same period in 2024.
• The company reported $0 revenue for both the three and six months ended September 30, 2025 and 2024.
• Cash and equivalents decreased significantly to $11,659 as of September 30, 2025, from $653,025 at March 31, 2025.
• Cash used in operating activities for the six months ended September 30, 2025, was $997,298, a substantial increase from $181,938 in the prior year period.
• Total stockholders' deficit increased to $4,698,800 as of September 30, 2025, from $4,156,205 at March 31, 2025.
• The company has an accumulated deficit of $9,620,486 and excess liabilities over assets of $4,698,800, raising substantial doubt about its ability to continue as a going concern.
• Management concluded that disclosure controls and procedures and internal control over financial reporting were not effective as of September 30, 2025, citing material weaknesses due to a lack of in-house technical expertise for complex transactions.
• The fiscal year-end was changed from March 31st to December 31st, effective September 22, 2025.

Sentiment

Score: 2

Explanation: The company faces severe financial distress with zero revenue, rapidly depleting cash, widening losses, and a stated "substantial doubt about its ability to continue as a going concern." The identified material weaknesses in internal controls further compound the negative outlook, despite some promising product development and strategic initiatives.

Positives

• The company is actively developing managed care agreements with southeastern states for Medicaid wound care patients, with potential annual revenue streams exceeding $100 million.
• Negotiations are underway with several distributors in Middle Eastern countries to provide the company's products.
• A proprietary AI-driven information system is being developed in partnership with Optimize Health Partners, aiming to revolutionize wound management, patient adherence, and personalized medication protocols.
• The company's plant in Tennessee has received FDA approval for the production of its OTC drug, Xcellderma.
• Clinical trials for the Wound Closure System demonstrated up to 95% closure rates of non-responding chronic wounds within 90 days.
• Successfully raised $500,000 from the sale of common stock and warrants during the period.
• Received an additional $211,400 investment for stock and warrants on October 24, 2025 (subsequent event).
• Chairman Greg Pilant assigned U.S. Patent No. 11,160,745 covering topical delivery methods for wound care to the company for $100,000 (subsequent event).

Negatives

• The company reported zero revenue for the six months ended September 30, 2025 and 2024.
• Net loss significantly increased to $1,477,596 for the six months ended September 30, 2025, from $802,132 in the prior year.
• Cash and equivalents plummeted from $653,025 to $11,659 during the six months ended September 30, 2025.
• Cash used in operating activities increased more than five-fold to $997,298 for the six months ended September 30, 2025, indicating a high cash burn rate.
• The company has an accumulated deficit of $9,620,486 and total stockholders' deficit of $4,698,800.
• Management has identified material weaknesses in internal control over financial reporting and concluded that disclosure controls and procedures were not effective.
• The company relies on related party financing, with several notes payable to related parties and a shareholder being renewed and extended.
• The company's common stock is not trading, and its fair value was determined by the Board and management at $0.50 per share.

Risks

• Substantial doubt about the company's ability to continue as a going concern due to incurred losses, accumulated deficit, and excess liabilities over assets.
• Lack of revenue history and limited history of operations, with no assurance of success or profitability.
• Inability to raise sufficient capital in the near future or meet financing requirements, which may lead to curtailment of operations or seeking less favorable terms.
• Impacts of future pandemics on the business, results of operations, financial position, and cash flows.
• The wound care healing space is competitive.
• Material weaknesses in internal control over financial reporting due to a lack of full-time, in-house personnel with technical knowledge for complex and non-routine transactions.
• Disclosure controls and procedures were not effective as of September 30, 2025.
• Reliance on related party transactions for intellectual property, leases, and financing.
• Contingent consideration of up to $10,000,000 is payable based on gross revenues or investment money.
• Intellectual property purchased requires further development prior to product finalization and production.

Future Outlook

The company expects to launch its sales initiative during the fourth quarter of its fiscal year ending December 31, 2025. Management is actively developing managed care agreements with southeastern states for Medicaid wound care patients and is in discussions with Puerto Rico for federally funded programs, which represent potential annual revenue streams exceeding $100 million. They are also engaging with major private insurance networks to secure preferred provider status and are developing a proprietary AI-driven information system to enhance wound management and reduce healthcare costs. Management plans to actively seek additional capital to launch the business and achieve profitability, though they cannot assure success in raising sufficient funds.

Management Comments

• Management is engaged in developing managed care agreements with southeastern states to manage their Medicaid wound care patients.
• Regenerex would provide our wound care products and protocols which would result in a large savings for the state Medicaid population.
• The Company is also in the process of negotiating with several distributors in various Middle Eastern countries to provide the Company's products.
• We expect to launch our sales initiative during the Company's fourth quarter of our fiscal year ending December 31, 2025.
• These contracts represent potential annual revenue streams exceeding $100 million.
• Simultaneously, we are actively engaging with major private insurance networks to secure preferred provider status, which would expand our patient access tremendously.
• Perhaps most exciting is our development of a proprietary AI-driven information system that promises to revolutionize our approach to wound management, patient adherence tracking, and personalized medication protocols.
• This system, developed in partnership with Optimize Health Partners, will integrate real-time patient data, using artificial intelligence, to while improve clinical outcomes and reduce healthcare costs.
• The competitive advantage this creates cannot be overstated, as it positions Regenerex Pharma as not just a manufacturer but a comprehensive healthcare solutions provider with data-driven insights that our competitors simply cannot match.
• Managements plans are to actively seek capital to enable the Company to add new products and/or services to ultimately achieve profitability.
• However, management cannot provide assurance that they can raise sufficient capital and whether the Company will ultimately achieve profitability, become cash flow positive, or raise additional debt and/or equity capital.
• Our Chief Executive Officer and Chief Financial Officer have concluded that our internal controls and procedures over financial reporting were not effective and that material weaknesses existed in the following area as of September 30, 2025.

Industry Context

Regenerex Pharma operates in the advanced wound care healing market, a significant healthcare challenge with nearly seven million Americans living with chronic wounds and growing prevalence due to an aging population and increasing rates of diabetes and obesity. The company aims to capture market share with its proprietary QBx technology, which addresses elevated protease levels common in chronic wounds. Its strategy involves targeting government-funded programs (Medicaid, Veterans Administration, prison system) and private insurance networks, aligning with trends towards value-based care and cost reduction in healthcare. The development of an AI-driven information system positions the company to leverage technology for improved patient outcomes and operational efficiency, a growing trend in the broader healthcare industry. The wound care healing space is well-suited for Home Care service providers, which the company aims to target.

Comparison to Industry Standards

• The company's Wound Closure System has demonstrated closure rates of up to 95% of non-responding chronic wounds within 90 days in clinical trials, which is a strong performance metric for a challenging patient population that has failed conventional treatments.
• The company claims QBx represents the "most efficacious, clinically proven chronic wound care technology globally," which, if substantiated, would set a high benchmark against competitors in the wound care market.
• The company's focus on developing an AI-driven information system for wound management, patient adherence, and personalized medication protocols positions it to potentially surpass traditional wound care providers by offering data-driven insights and comprehensive solutions.

Corporate Governance

Related Party Transactions

• The company purchased assets from its current Chief Executive Officer (CEO) and Secretary/Treasurer.
• A plant and equipment lease agreement was entered into with Woundcare Labs, LLC, a party related to the CEO.
• An agreement was made with Optimize Health Partners, LLC, a related party to the CFO, for the development and provision of information technology systems, involving the issuance of 3,000,000 shares.
• Related party advances from the former CEO totaled $0 as of September 30, 2025 (previously $13,652).
• Notes payable to the CEO for operating expenses totaled $214,584 as of September 30, 2025, bearing 10% interest and extended to September 30, 2026.
• Notes payable to a shareholder totaled $488,797 as of September 30, 2025, bearing 10% interest and renewed to March 31, 2026.
• A promissory note with the wife of the former, deceased CFO totaled $207,737 as of September 30, 2025, bearing 10% interest and renewed to June 30, 2026.
• Contingent consideration of up to $10,000,000 is payable to the CEO in connection with the November 15, 2021 Asset Purchase Agreement, amended in January 2025 to 25% of all gross revenues or investment money raised. Payments made to the CEO were $625,000 as of September 30, 2025, with an outstanding liability of $150,007.
• Chairman Greg Pilant (CEO) assigned U.S. Patent No. 11,160,745 to the company for $100,000, retaining exclusive rights for cosmetic applications (subsequent event).

Stakeholder Impact

• Shareholders: Significant dilution risk from ongoing stock and warrant issuances for financing and compensation. The substantial net losses, negative cash flow, and going concern doubt pose a high risk to shareholder value. The stock is not trading, limiting liquidity.
• Employees/Consultants: Benefiting from stock-based compensation and warrants, but the company's going concern risk could impact job security and the value of equity awards.
• Creditors (Related Parties/Shareholders): Notes payable to related parties and a shareholder have been extended multiple times, indicating the company's difficulty in meeting obligations and increasing their exposure.
• Customers (Future): Potential customers (Medicaid, private insurers, international distributors) could benefit from the company's wound care products and protocols, especially if the AI system delivers on its promise of improved outcomes and reduced costs. However, the company's financial instability could pose a risk to long-term supply.
• Suppliers: The company's high payables and going concern risk could impact its ability to pay suppliers in a timely manner.

Next Steps

• Launch sales initiative during the company's fourth fiscal quarter ending December 31, 2025.
• Actively seek additional capital to fund operations and achieve profitability.
• Continue developing managed care agreements with southeastern states for Medicaid wound care patients.
• Continue negotiations with distributors in Middle Eastern countries.
• Continue engaging with major private insurance networks to secure preferred provider status.
• Further develop and implement the proprietary AI-driven information system in partnership with Optimize Health Partners.
• Management will continue to seek guidance from third-party experts and consultants to address material weaknesses in internal controls.
• Management will continue to monitor and evaluate the designation, implementation, and effectiveness of internal controls and procedures.
• Evaluate the impact of ASU 2024-03 and ASU 2025-06 on financial statement disclosures, considering early adoption of ASU 2025-06.

Key Dates

Recommendation

The company exhibits severe financial distress with zero revenue, rapidly escalating losses, and a critically low cash balance, explicitly stating "substantial doubt about its ability to continue as a going concern." The identified material weaknesses in internal controls further undermine confidence in financial reporting. While there are promising product developments and strategic initiatives, the immediate financial outlook is dire, and the company's ability to secure sufficient capital for commercialization is highly uncertain. The stock is not trading, indicating a lack of liquidity and market interest. For a seasoned investor, these factors point to an extremely high-risk investment with a high probability of significant capital loss.

Keywords

Wound Care, Biotechnology, Medical Devices, Regenerex Pharma, QBx, Chronic Wounds, Diabetic Ulcers, SEC Filing, 10-Q, Healthcare, Pharma, AI in Healthcare