Company Overview
From July 2018 through mid-2021, Greater Cannabis focused on commercializing its own and licensed technologies worldwide for transmucosal and transdermal delivery of legal medical or recreational cannabis (other than in the field of oral care) and cannabinoids (“CBD”). While part of the cannabis family, CBD, which contains less than 0.3% tetrahydrocannabinol (“THC”), the psychoactive compound that produces the “high” in marijuana, is distinguished from cannabis by its use, physical appearance and lower THC concentration (cannabis generally has a THC level of 10% or more). The Company’s initial product was an oral transmucosal patch platform which provides for loaded actives to be absorbed by the buccal mucosa into the body. Although the Company was able to launch the product and received some limited initial orders, Greater Cannabis management ultimately elected to pursue other opportunities which they believed offered the Company greater potential for growth and ultimate profitability.
Accordingly, on October 19, 2021 the Company entered into a license agreement with Shaare Zedek Scientific Ltd. (“SZS”), the technology transfer arm of
Jerusalem’s Shaare Zedek Medical Center (SZMC). The license agreement covers the license of SZS’s novel cannabinoid therapeutic focused on treatment of autism, schizophrenia, Parkinson’s disease, Alzheimer’s disease and other neuropsychiatric disorders. Shaare Zedek Medical Centerfounded in 1901, is one of the largest multidisciplinary research hospitals in Israel with 1,000 beds and over 850,000 patient visits a year. The SZMC Center for Research and Development Has over 300 annual publications of investigator initiated studies in medical journals in addition to almost 160 clinical trials.
Accompanying the license agreement is a joint research and development agreement, which will focus on continuing the clinical program spearheaded by Dr. Adi AranMD Director of Pediatric Neurology at SZMC, Board Member of the
Israeli Society for Pediatric Neurologyand co-inventor of the novel cannabinoid therapy. Dr. Aran is a world renowned expert in cannabis research and pediatric neurology and was the principal investigator of the first ever cannabis research study conducted on autistic children.
Dr. Aran’s pioneering study assessed safety, tolerance and efficacy of CBD based medical cannabis as an adjuvant therapy for refractory behavioral problems in children with ASD. The results provided very compelling evidence that medical cannabis is an effective therapy for children on the autism spec. 8% of the children improved, with 62% of parents reporting substantial improvements. Half of the children had improved communication and 40% reported a decrease in anxiety. The same children had not shown improvement with conventional drug therapies. Dr. Aran and his team have now developed a novel combination therapy that is believed to be significantly more effective than the cannabis-only formulation that had been used in the aforementioned study. The Company plans to further develop this therapeutic and conduct clinical studies to further substantiate its and efficacy beginning in neuropsychiatric disorders.
The clinical studies of the therapeutic are expected to require an investment of up to $1,000,000 and up to two years to finalize.
The Company’s current business plan is to (i) conduct clinical studies on and commercialize the cannabis-based therapeutic and (ii) concentrate on cannabis related investment and development opportunities through direct equity investments, joint ventures, licensing agreements or acquisitions.
On October 7, 2022 the company announced in a press release that it has submitted a clinical trial application to the Israel Ministry of Health for approval of a Phase II clinical trial to study the safety and efficacy of its neuroprotective cannabinoid therapeutic to treat autism related spectrum disorders (ASD) and other neuropsychiatric illnesses.
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Results of operations
Three months ended September 30, 2022 as compared to three months ended
September 30, 2021
The Company had no revenue during the three months ended September 30, 2022 and 2021.
Our operating expenses for the three months ended September 30, 2022 decreased
$25,034 to $49,304from $74,338 for the 2021 quarter. Operating expenses include officers’ compensation and professional fees. The decrease from the 2021 quarter to the 2022 quarter was primarily a result of a reduction of other operating expenses in the amount of $36,034.
Other income and (expenses) was $(53,472) for the three months ended September 30, 2022as compared to $(177,940) for the same quarter in 2021. Loss on conversion of notes payable increased by $4,716 and amortization of debt discounts decreased by $117,746.
Our net loss for the three months ended September 30, 2022 was $102,776 as compared to the net loss of $252,278 for the same quarter in 2021.
Nine months ended September 30, 2022 as compared to nine months ended September 30, 2021
The Company had no revenue during the nine months ended September 30, 2022as compared to revenue from sales of its oral transmucosal patch platform of
$12,630 for the nine months ended September 30, 2021. Cost of product sales was
$-0– and $12,655 For the 2022 and 2021 periods respectively and the Company incurred gross profit (loss) of $25 for the 2021 period. As noted above, the Company shifted its focus from that product in the second half of 2021.
Our operating expenses for the nine months ended September 30, 2022 decreased
$88,251 to $134,768from $223,019 for the 2021 period. Operating expenses include officers’ compensation and professional fees. The decrease from the 2021 period to the 2022 period was primarily a result of a reduction of $31,000 in officers compensation and decreased other operating expenses of $57,251.
Other income and (expenses) was $(178,099) for the nine months ended September 30, 2022as compared to $(182,851) for the same period in 2021. Derivative liability income decreased by $407,370loss on conversion of notes payable and accrued interest to common stock decreased by $318,934and amortization of debt discounts decreased by $100,173.
Our net loss for the nine months ended September 30, 2022 was $312,867 as compared to the net loss of $405,895 for the same period in 2021.
Liquidity and Capital Resources
We had $289,094 cash at September 30, 2022compared to $377,520 at December 31, 2021.
At September 30, 2022we had $307,437 in principal amount of outstanding notes to third parties compared to $369,095 at December 31, 2021.
The proceeds from loans and convertible debts as well as cash on hand is being used to fund the operations of our current operations.
The following table provides detailed information about our net cash flows for the nine months ended September 30, 2022 and 2021.
September 30, September 30,
2022 2021
Net cash used in operating activities $ (88,426 ) $ (156,595 )
Net cash used in investing activities
- -
Net cash provided by financing activities - 500,000
Net increase (decrease) in cash $ (88,426 ) $ 343,405
Critical Accounting Policies and Estimates
The SEC issued Financial Reporting Release No. 60, “Cautionary Advice Regarding Disclosure About Critical Accounting Policies” suggesting that companies provide additional disclosure and commentary on their most critical accounting policies. In Financial Reporting Release No. 60, the SEC has defined the most critical accounting policies as the ones that are most important to the portrayal of a company’s financial condition and operating results and require management to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Based on this definition, we have identified the following significant policies as critical to the understanding of our financial statements. (i) the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and (ii) the reported amounts of revenues and expenses during the reporting periods covered by the financial statements. Our management expects to make judgments and estimates about the effect of matters tha t are inherently uncertain. As the number of variables and assumptions affecting the future resolution of the uncertainties increase, these judgments become even more subjective and complex. Although we believe that our estimates and assumptions are reasonable, actual results may differ significantly from these. Changes in estimates and assumptions based upon actual results may have a material impact on our results.
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Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, that capital expenditures or capital resources material to investors.
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