This form 10-Q contains certain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. For this purpose any
statements contained in this Form 10-Q that are not statements of historical
fact may be deemed to be forward-looking statements. Without limiting the
foregoing, words such as “may”, “will”, “expect”, “believe”, “anticipate”,
“estimate” or “continue” or comparable terminology are intended to identify
forward-looking statements. These statements by their nature involve substantial
risks and uncertainties, and actual results may differ materially depending on a
variety of factors, many of which are not within our control. These factors
include by are not limited to economic conditions generally and in the
industries in which we may participate; competition within our chosen industry,
including competition from much larger competitors; technological advances and
failure to successfully develop business relationships.
This discussion contains forward-looking statements that reflect our plans,
estimates and beliefs. Our actual results may differ materially from those
anticipated in these forward-looking statements.
Overview
research, manufacturing, and consumer products. Medolife Rx was created through
the merger of Medolife, a private company founded by Dr.
pioneered the unlaying polarization technology, and
direct-to-consumer wellness product portfolio company. The Company’s lead
clinical development programs include EscozineĀ®, a proprietary formulation
consisting of small molecule peptides derived from Rhopalurus princeps
scorpions, which is amplified by the Company’s polarization technology and is
being researched as a treatment of various indications, including COVID-19 and
cancer. The Company intends to pursue product registration and drug approval in
multiple countries.
With its line of AELIA brand products, Medolife manufactures and distributes
consumer wellness products in areas such as pain relief, beauty, and general
wellness. AELIA products are designed using
technology, which applies advances in quantum biology to increase the potency of
active ingredients. Ultimately, Medolife’s mission is to deliver better, more
effective ingredients to elevate product efficacy, reduce waste, and facilitate
healthier, more sustainable consumption.
Beyond its own clinical and consumer applications, the polarization technology
used by Medolife and its subsidiaries has many potential applications. From
potentiating bio-ingredients, to producing more-effective carbon-trapping
plants, to transformative anti-aging solutions, Medolife could have the
opportunity to upend how commercial and pharmaceutical products are made and
increase their benefits, while decreasing their chemical concentration.
Our Company History
The company was founded in
On
of control, our board of directors and officers was reconstituted through the
resignation of
Financial Officer, Secretary and Treasurer of the Registrant and the appointment
of Mr.
Officer and Mr.
On
the state of
Reorganization, with
and Quanta Acquisition Corp.
subsidiary. Pursuant to the terms of the Merger Agreement,
Corp.
Quanta surviving as a wholly owned subsidiary. Following the merger, we adopted
our business plan.
On
the change in control transaction. As consideration for the merger, we agreed to
issue the shareholders of Quanta an aggregate of 21,908,810 shares of our common
stock, par value
6,500,000 shares of common stock, which represented 23% of our issued and
outstanding stock following the merger.
Simultaneously with the merger, we accepted subscriptions for 6,500,000 shares
of common stock in a private placement offering at a purchase price of
share for an aggregate offering amount of
non-affiliated investors warrants to purchase 3,000,000 shares of our common
stock at an exercise price of
Following the consummation of the merger, Quanta shareholders beneficially owned
approximately 63% of our issued and outstanding common stock.
On
Solution, Inc.
On
Officer and Chief Financial Officer, 2,500,000 shares of a newly created class
of preferred stock, Series A Preferred Stock.
On
Agreement with
transfer 2,500,000 shares of the Company’s Series A Super Voting Preferred Stock
to
Company because the holder of such 2,500,000 shares of our Series A Super Voting
Preferred Stock automatically carries a vote equal to 51% on all matters
submitted to a vote of the holders of our Common Stock and Preferred Stock. On
On
with
the Company agreed to acquire 51% of Medolife in exchange for 9,000 shares of
newly created Series B Convertible Preferred Stock. On
completed our acquisition of 51% of Medolife and Medolife’s founder,
Mikaelian
Sands
director of the Company on
executed a Control Block Transfer Agreement with
Mikaelian
shares of the Company’s Series A Super Voting Preferred Stock to
representing a transfer of majority voting control over the Company because the
holder of such 2,500,000 shares of our Series A Super Voting Preferred Stock
automatically carries a vote equal to 51% on all matters submitted to a vote of
the holders of our Common Stock and Preferred Stock.
transfer the Control Block to
of the Company’s Common Stock, and for the payment of
as well as the payment of health insurance benefits through January of 2022.
19
Medolife provides contract research services. The Company focuses on research,
development, and production of pharmaceutical-grade products, as well as
clinical evidence-based nutraceuticals utilizing patented polarization
technology. Medolife Rx serves clients in
In 2007, Medolife began its venom-to-drug research and development concept. In
2008, Medolife identified the Rhopalurus princeps scorpion species, which are
endemic to the
into an agreement with the local
to investigate the anticancer properties of scorpion venom peptides. The
Company’s research confirmed the anticancer properties of the peptide. That same
year, Medolife registered its product, Escozine, in the
to the prime material and preliminary studies originating from
Republic
an anti-tumoral alternative medicine in the
the company to perform clinical studies and observations in the country.
Quanta, which entered the CBD pain-relief rub market (“Muscle Rub”), is the
first in a series of products to emerge from our labs. At the heart of its
well-documented effectiveness is our proprietary “polarization” process, which
uses electromagnetic force to markedly enhance bioactivity at the molecular
level-a polarized ingredient creates stronger bonds with the body’s receptors
providing higher bioavailability. The company believes this natural solution has
nearly limitless applications in the world of plant-based consumer products.
In early 2020, the company was preparing to apply to the FDA to initiate the
approval process for Escozine as an orphan drug for pancreatic cancer.
Weinberg Group
application and guidelines.
As the COVID-19 pandemic spread during the Spring of 2020, Medolife studied the
scorpion venom peptide as a potential COVID-19 drug treatment and began
confirming its antiviral properties. The company applied to the FDA as a
Pre-Investigational New Drug (PIND), which opened PIND #150335. For PIND
Submission and Clinical Trial Strategy in
Republic
FDA regulatory matters.
In August of 2020, Medolife initiated clinical studies at the
Clinic
clinic with a license allowing them to treat COVID-19 patients. The study
included 450 COVID-19 patients. The observation contained more female than male
patients, with 252 female and 198 male participants. Out of 450 participants,
there was an even spread among the age groups, with a higher number in the
41-to-50-year-old group.
EFFICACY STUDY.
Escozine was used as a 3-pillar treatment: a Therapeutic, a Palliative, and a
Preventative.
Therapeutic ? Escozine was used as a monotherapy ? All therapeutic participants were tested COVID-19 positive prior to observation. ? 100% of patients were discharged with a negative COVID-19 test result within 7 to 10 days of treatment with Escozine.
Conclusion: Within 4-5 days, all COVID-19 patients using Escozine tested
negative for the virus, indicating Escozine eliminated the COVID-19 virus or
accelerated recovery.
Palliative ? COVID-19 positive patients report a dramatic decrease of symptoms within 2-4 days of Escozine treatments. The World Health Organization Quality of Life ("WHOQOL") Bref quality of life questionnaire by theWorld Health Organization (WHO ) was used sinceJuly 2020 to evaluating symptoms in patients, including: ? Shortness of breath ? Pain ? Fatigue ? Headache ? Loss of taste ? Fever ? Loss of smell (anosmia) 20
Conclusion: All participants reported significant improvement on all their
COVID-19-related symptoms within 5 days, indicating that Escozine can be used to
treat the symptoms of COVID-19.
Preventative ? Transmission of virus to treating physicians and nurses of COVID-19 patients is inhibited upon administering Escozine. ? Substantial reduction in infectability and spread of the SARS-CoV-2 virus.
Conclusion: All hospital workers remained healthy during the clinical
observation while taking Escozine, indicating that Escozine can be used as a
preventative measure for COVID-19. The preventative capabilities require
additional study.
SAFETY STUDY.
To verify the safety of using Escozine, patients were tested before and after
treatment for:
? Hematology ? Clinical chemistry (Kidney and Liver function tests, Enzymes, Glucose, Calcium and Phosphorus) ? Urine ? CD4/CD8
Conclusion: No toxic response was observed in 100% of patients and no
side-effects were reported, indicating that Escozine is safe to use for COVID-19
patients.
ADDITIONAL FINDINGS.
During the clinical study, Medolife observed that Escozine prevents Acute Kidney
Injury (AKI) caused by COVID-19:
? During the clinical study, no deaths occurred. ? 40% of the monitored COVID-19 patientswho were administered Escozine, had serum creatinine that was higher than normal, indicating AKI before Escozine administration. ? After Escozine administration, most of the patient's creatinine concentrations dropped or did not change. ? Overall, the frequency of patients that developed normal creatinine levels after Escozine administration was statistically significant (p<0.05). ? Medolife has received a new reply from the FDA on their latest submission of requested data. In the reply, the FDA: ? Stated that they acknowledge the Company's clinical trial as an informal proof-of-concept study ? Laid out very specific guidelines for the next steps required by the regulatory body in order to garner approval for Escozine as a treatment for COVID-19, in which the FDA requested: ? Pharmacokinetic (PK) study, which Medolife has initiated in theUnited Kingdom . ? DNA toxicology study, for which Medolife is negotiating with a GLP certified laboratory inthe United States . ? Additional Chemistry, Manufacturing and Controls (CMC) data from Medolife's contract manufacturer,CURE Pharmaceutical Corporation .
R&D Expenses related to Escozine.
Over the last 24 months, the company has spent more than
and development related to Escozine as both a treatment of cancer and for
COVID-19.
21 Quanta Basics
Quanta and its subsidiary Medolife are cutting-edge technology platform whose
patented, proprietary technology harnesses advances in quantum biology to
increase the potency of active ingredients. Currently, the company supports
product formulations in cancer and COVID-19 treatments, as well as pain
management, anti-inflammation, skincare, agriculture, nutritional supplements,
and plant-based consumables. Ultimately, the company’s mission is to deliver
better, more effective ingredients to elevate product efficacy, reduce waste and
facilitate healthier, more sustainable consumption.
The established resonance theory behind the company’s polarization process has
many potential applications. From potentiating bio-ingredients to produce
more-effective carbon-trapping plants to transformative anti-aging solutions the
company’s technology has the opportunity to upend how commercial products are
made and the benefits from them. Already we see multi-trillion-dollar global
industries benefiting from the company’s technology.
Our proof of concept, the company’s market-leading CBD pain-relief rub (“Muscle
Rub”), is only the first in a series of paradigm shift products to emerge from
our labs. At the heart of its well-documented effectiveness is our proprietary
“polarization” process, which uses electromagnetic force to markedly enhance
bioactivity at the molecular level-a polarized active ingredient is more soluble
and creates stronger bonds with the body’s receptors. This allows us to enhance
ingredients so they work faster and more powerfully without the use of chemical
by-products or cellular penetration. the company believes this natural solution
has nearly limitless applications in the world of plant-based consumer products.
The company is involved in ambitious projects that we believe will reshape the
next wave of climate science, sustainability, nutrition, and more. Having
harnessed the technology of the future, the company is dedicated to bringing
tomorrow’s health and wellness solutions to the billions in need today.
Discovery Synopsys
Using our product development process and business-to-business and
direct-to-consumer sales approaches as a benchmark for future business, we
developed the Quanta business model. The company believes that its technology
unique ability to strengthen ingredients renders them more potent without added
chemicals or penetrating cells means Quanta is in a first-of-its-kind position
in the market. As the world’s first company focused on Quantum Biology we sit in
a strong, but unique position in the market.
Upcoming products and ventures will be designed to achieve or surpass this level
of consumer benefit and uptake.
Quanta Business Model in 3 P’s: Potentiation, Partners, and Profits
After two years we believe the best possible model for the long-term success of
the company is collaborating with best-in-class partners through joint ventures
for new verticals, products, and research. These joint ventures may involve a
jointly owned special purpose entity or they may be entirely based on
contractual obligations.
The unique ability to increase the ingredient and product performance opens the
doors for major opportunities. Higher performing ingredients mean less is needed
to make a strong impact (increased margins, increase overall efficacy). We
proved this with our Muscle Rub, which uses approximately 1/3 the CBD of
competing products with demonstrably improved results.
The level of potentiation delivered by Quanta allows our partners the unique
ability to provide higher-performing products, lower material costs, more
competitive pricing and increased profit margins. In short, our partners will be
able to make better performing, more affordable products with a higher repeat
purchase. This is true disruption and consumer utopia.
We aim to work with groups that specialize in manufacturing, marketing, selling
and distributing existing product lines that utilize ingredients we can
potentiate. Partners like this facilitate efficient market delivery of joint
innovations.
We believe this strategy provides greater shareholder value, enhances revenue
potential, defrays upfront expenses and affords us the ability to raise capital.
Ultimately, these ventures would result in licensing out our technology to other
reputable brands and companies to create co-branded products whereas the term
“Powered by Quanta” becomes as recognized as “Intel Inside.”
We believe this type of partnership will afford a company Quanta partners with:
? Development of emerging products with cutting edge ingredients. ? A product line with a true point of differentiation. ? New SKUs with an increased margin. ? Decreased cost of goods sold. 22
Simultaneously these partnerships can allow Quanta:
? Greater brand recognition. ? Increased revenue and in turn profitability. ? Quicker timeline to more licensing opportunities because of a track record of success. ? Brand to become synonymous with improving the performance of ingredients within products. Manufacturing Partnerships -
Quanta is currently focused on partnering with large-scale manufacturers and
distributors able to produce products that meet the requirements of applicable
regulations IE: Good Manufacturing Practices to fulfill orders of our own
product line. This type of partnership is crucial because it will afford:
? New product development that meets certification requirements ? Much larger production scale ? Speed to market ? Increased distribution and profitability
With our licensing capabilities, Quanta believes this technology can render
better, more efficacious products that cost less to create but command a higher
purchase value because of polarized ingredients. This, in turn, allows companies
to diversify their catalog of products while simultaneously providing them with
a distinguished advantage. More efficacious ingredients.
Government Regulation
We believe we are in compliance with applicable federal, state and other
regulations and that we have compliance programs in place to ensure compliance
going forward. There are no regulatory notifications or actions pending.
Results of Operations Summary of Key Results
Results of Operations for three months ended
three months ended
Revenue
Net sales are comprised of wholesale sales to our retail partners and sales
through our direct-to-consumer channel. Net sales in both channels reflect the
impact of product returns as well as discounts for certain sales programs or
promotions.
For the three months ended
sales. For the three months ended
Expenses
Operating expenses for the three months ended
including
administrative, and
associated with operations.
Operating expenses for the three months ended
including
administrative, and
costs associated with operations.
Other Income (Expense)
For the three months ended
net other expenses.
For the three months ended
net other expenses.
Net Loss
Net loss for the three months ended
the three months ended
taxes for either period was recorded.
23 Going Concern
We have yet to establish any history of profitable operations. For the three
months ended
used cash in operating activities of
Company had a working capital deficiency of
substantial doubt about our ability to continue as a going concern within one
year after the date the financial statements are issued. The going concern
opinion could materially limit our ability to raise additional funds through the
issuance of new debt or equity securities, and future reports on our financial
statements may also include an explanatory paragraph with respect to our ability
to continue as a going concern.
At
Company’s ability to continue as a going concern is dependent upon improving its
profitability and the continuing financial support from its shareholders.
Management believes the existing shareholders or external financing will provide
additional cash to meet the Company’s obligations as they become due. No
assurance can be given that any future financing if needed, will be available
or, if available, that it will be on terms that are satisfactory to the Company.
Even if the Company can obtain additional financing, if needed, it may contain
undue restrictions on its operations, in the case of debt financing, or cause
substantial dilution for its stockholders, in the case of equity financing
Critical Accounting Policies and Estimates
Our financial statements are prepared in accordance with accounting principles
generally accepted in
make estimates and assumptions that affect the reported amounts in our financial
statements including various allowances and reserves for accounts receivable and
inventories, the estimated lives of long-lived assets and trademarks and
trademark licenses, as well as claims and contingencies arising out of
litigation or other transactions that occur in the normal course of business.
The following summarizes our most significant accounting and reporting policies
and practices:
Use of estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Significant accounting estimates include certain assumptions related to, among
others, impairment analysis of long-term assets, valuation allowance on deferred
income taxes, assumptions used in valuing stock instruments issued for services,
assumptions made in valuing derivative liabilities, and the accrual of potential
liabilities. Actual results may differ from these estimates.
Revenue Recognition
Product Sales-Substantially all of the Company’s revenue is derived from product
sales. Product revenue and costs of sales are recognized when control of the
products transfers to our customer, which generally occurs upon shipment from
our facilities. The Company’s performance obligations are satisfied at that
time. The Company does not have any significant contracts with customers
requiring performance beyond delivery, and contracts with customers contain no
incentives or discounts that could cause revenue to be allocated or adjusted
over time.
License revenue- Revenue from symbolic IP is recognized over the access period
to the Company’s IP (see Note 2).
Cost of goods sold includes direct costs and fees related to the sale of our
products.
Stock Compensation
The Company periodically issues stock options, warrants, shares of common stock,
and restricted stock unit awards, as share-based compensation to employees and
non-employees. The Company accounts for its share-based compensation in
accordance with FASB ASC 718, Compensation – Stock Compensation (Topic 718).
Stock-based compensation cost for employees is measured at the grant date, based
on the estimated fair value of the award, and is recognized as expense over the
requisite service period. Recognition of compensation expense for non-employees
is in the same period and manner as if the Company had paid cash for the
services.
Recently Issued Accounting Pronouncements
See Note 1 to the Condensed Consolidated Financial Statements
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