UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 001-41512

SILO PHARMA, INC.

(Exact name of registrant as specified in its charter)

Nevada		27-3046338
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

677 N. Washington Boulevard

Sarasota, Florida

34236

(Address of principal executive offices)

(Zip code)

(718) 400-9031
(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Exchange Act:

Title of each class		Trading Symbol(s)		Name of exchange on which registered
Common Stock, par value $0.0001 per share		SILO		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registration was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of common stock, par value $0.0001 per share, outstanding as of November 12, 2024 was: 4,484,456.

SILO PHARMA, INC. AND SUBSIDIARY
FORM 10-Q
SEPTEMBER 30, 2024

TABLE OF CONTENTS

		Page
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements	1
	Consolidated Balance Sheets as of September 30, 2024 (Unaudited) and December 31, 2023	1
	Consolidated Statements of Operations and Comprehensive Loss for the Three and Nine Months Ended September 30, 2024 and 2023 (Unaudited)	2
	Consolidated Statements of Changes in Stockholders’ Equity for the Three and Nine Months Ended September 30, 2024 and 2023 (Unaudited)	3
	Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023 (Unaudited)	4
	Notes to Consolidated Financial Statements (Unaudited)	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings	27
Item 1A.	Risk Factors	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	27
Item 3.	Defaults Upon Senior Securities	28
Item 4.	Mine Safety Disclosures	28
Item 5.	Other Information	28
Item 6.	Exhibits	28

SIGNATURES		29

-i-

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements that involve substantial risks and uncertainties. All statements, other than statements of historical facts, contained in this report, including statements regarding our strategy, future operations, future financial position, future revenue, projected costs, prospects, plans and objectives of management and expected market growth, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may,” “could,” “will,” “would,” “should,” “expect,” “plan,”, “anticipate,” “believe,” “estimate,” “intend,” “predict,” “seek,” “contemplate,” “project,” “continue,” “potential,” “ongoing” or the negative of these terms or other comparable terminology.

Any forward-looking statements are qualified in their entirety by reference to the risk factors discussed throughout this Quarterly Report on Form 10-Q. Some of the risks, uncertainties and assumptions that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, but are not limited to:

●

our ability to obtain additional funds for our operations;

●

our financial performance;

●

risks relating to the timing and costs of clinical trials and the timing and costs of other expenses;

●

risks related to market acceptance of products;

●

intellectual property risks;

●

the impact of government regulation and developments relating to our competitors or our industry;

●

our competitive position;

●

our industry environment;

●

our anticipated financial and operating results, including anticipated sources of revenues;

●

assumptions regarding the size of the available market, benefits of our products, product pricing and timing of product launches;

●

our estimates of our expenses, losses, future revenue and capital requirements, including our needs for additional financing;

●

our ability to attract and retain qualified key management and technical personnel;

●

statements regarding our goals, intensions, plans and expectations, including the introduction of new products and markets;

●

our cash needs and financing plans.

These statements relate to future events or our future operational or financial performance, and involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the section titled “Risk Factors” and elsewhere in this report.

Any forward-looking statement in this report reflects our current view with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our business, results of operations, industry and future growth. Given these uncertainties, you should not place undue reliance on these forward-looking statements. No forward-looking statement is a guarantee of future performance. You should read this report completely and with the understanding that our actual future results may be materially different from any future results expressed or implied by these forward-looking statements.

This report also contains estimates, projections and other information concerning our industry, our business and our markets, including data regarding the estimated size of those markets and their projected growth rates. Information that is based on estimates, forecasts, projections or similar methodologies is inherently subject to uncertainties and actual events or circumstances may differ materially from events and circumstances reflected in this information. Unless otherwise expressly stated, we obtained these industry, business, market and other data from reports, research surveys, studies and similar data prepared by third parties, industry, and general publications, government data and similar sources. While we believe that the reports, research surveys, studies and similar data prepared by third parties are reliable, we have not independently verified the data contained in them.

You are cautioned not to place undue reliance on any forward-looking statements, which speak only as of the date of this report. Except as required by law, we do not undertake any obligation to update or release any revisions to these forward-looking statements to reflect any events or circumstances, whether as a result of new information, future events, changes in assumptions or otherwise, after the date hereof. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. We qualify all of the information presented in this Quarterly Report on Form 10-Q, and particularly our forward-looking statements, by these cautionary statements.

-ii-

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

SILO PHARMA, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

	September 30,			December 31,
	2024			2023
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	4,860,890		$	3,524,308
Short-term debt investments		3,154,443			4,140,880
Prepaid expenses and other current assets		246,454			15,970

Total Current Assets		8,261,787			7,681,158

LONG-TERM ASSETS:
Prepaid expenses and other assets - non-current		60,604			64,983
Intangible assets, net		244,308			-

Total Long-Term Assets		304,912			64,983

Total Assets	$	8,566,699		$	7,746,141

LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	972,730		$	703,488
Deferred revenue - current portion		72,102			72,102

Total Current Liabilities		1,044,832			775,590

LONG TERM LIABILITIES:
Deferred revenue - long-term portion		739,604			793,680

Total Long Term Liabilities		739,604			793,680

Total Liabilities		1,784,436			1,569,270

Commitment and Contingencies (see Note 7)

STOCKHOLDERS’ EQUITY:
Preferred stock, $0.0001 par value, 5,000,000 shares authorized: none designated as of September 30, 2024 and December 31, 2023
Common stock, $0.0001 par value, 100,000,000 shares authorized; 4,488,296 and 3,159,096 shares issued and 4,484,456 and 2,906,241 shares outstanding at September 30, 2024 and December 31, 2023, respectively		449			316
Additional paid-in capital		20,302,356			17,525,714
Treasury stock, at cost (3,840 and 252,855 shares on September 30, 2024 and December 31, 2023, respectively)		(6,268	)		(471,121	)
Accumulated other comprehensive income (loss)		19,797			(6,227	)
Accumulated deficit		(13,534,071	)		(10,871,811	)

Total Stockholders’ Equity		6,782,263			6,176,871

Total Liabilities and Stockholders’ Equity	$	8,566,699		$	7,746,141

See accompanying notes to unaudited consolidated financial statements.

-1-

SILO PHARMA, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Unaudited)

	For the Three Months Ended						For the Nine Months Ended
	September 30,						September 30,
	2024			2023			2024			2023

LICENSE FEE REVENUES	$	18,025		$	18,025		$	54,076		$	54,076

COST OF REVENUES		1,459			1,459			4,378			4,378

GROSS PROFIT		16,566			16,566			49,698			49,698

OPERATING EXPENSES:
Compensation expense		169,736			379,294			511,463			710,737
Professional fees		258,887			338,164			899,954			1,273,729
Research and development		517,548			174,495			1,292,437			508,127
Insurance expense		21,100			25,915			63,905			72,811
Selling, general and administrative expenses		59,350			(127,904	)		174,281			176,162

Total operating expenses		1,026,621			789,964			2,942,040			2,741,566

LOSS FROM OPERATIONS		(1,010,055	)		(773,398	)		(2,892,342	)		(2,691,868	)

OTHER INCOME (EXPENSE):
Interest and dividend income, net		84,940			116,178			250,159			290,150
Interest expense		(1,081	)		(1,078	)		(4,810	)		(4,596	)
Net realized loss on short-term debt investments		-			(1,862	)		(1,025	)		(4,041	)
Penalty from early termination of certificate of deposit		-			-			-			(166,034	)
Net unrealized loss on equity investments		-			-			-			(3,118	)
Foreign currency transaction loss		(2,618	)		-			(14,242	)		-

Total other income, net		81,241			113,238			230,082			112,361

LOSS BEFORE PROVISION FOR INCOME TAXES		(928,814	)		(660,160	)		(2,662,260	)		(2,579,507	)

Provision for income taxes		-			-			-			-

NET LOSS	$	(928,814	)	$	(660,160	)	$	(2,662,260	)	$	(2,579,507	)

COMPREHENSIVE LOSS:
Net loss	$	(928,814	)	$	(660,160	)	$	(2,662,260	)	$	(2,579,507	)

Other comprehensive income (loss):
Unrealized gain (loss) on short-term debt investments		11,771			2,558			26,024			(723	)

Total comprehensive loss	$	(917,043	)	$	(657,602	)	$	(2,636,236	)	$	(2,580,230	)

NET LOSS PER COMMON SHARE:
Basic and diluted	$	(0.22	)	$	(0.21	)	$	(0.78	)	$	(0.82	)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted		4,301,847			3,108,797			3,410,415			3,140,299

See accompanying notes to unaudited consolidated financial statements.

-2-

SILO PHARMA, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023

(Unaudited)

							Additional									Accumulated Other						Total
	Common Stock						Paid In			Treasury Stock						Comprehensive			Accumulated			Stockholders’
	Shares			Amount			Capital			Shares			Amount			Income (Loss)			Deficit			Equity

Balance, December 31, 2023		3,159,096		$	316		$	17,525,714			252,855		$	(471,121	)	$	(6,227	)	$	(10,871,811	)	$	6,176,871

Purchase of treasury stock		-			-			-			72,790			(115,452	)		-			-			(115,452	)

Unrealized gain on short-term debt investments		-			-			-			-			-			32,331			-			32,331

Net loss		-			-			-			-			-			-			(801,667	)		(801,667	)

Balance, March 31, 2024		3,159,096			316			17,525,714			325,645			(586,573	)		26,104			(11,673,478	)		5,292,083

Sale of common stock and pre-funded warrants		883,395			89			1,673,127			-			-			-			-			1,673,216

Exercise of pre-funded warrants		34,037			3			-			-			-			-			-			3

Purchase of treasury stock		-			-			-			30,065			(57,661	)		-			-			(57,661	)

Unrealized loss on short-term debt investments		-			-			-			-			-			(18,078	)		-			(18,078	)

Net loss		-			-			-			-			-			-			(931,779	)		(931,779	)

Balance, June 30, 2024		4,076,528			408			19,198,841			355,710			(644,234	)		8,026			(12,605,257	)		5,957,784

Sale of common stock and warrants		763,638			76			1,741,446			-			-			-			-			1,741,522

Cancellation of treasury stock		(351,870	)		(35	)		(637,931	)		(351,870	)		637,966			-			-			-

Unrealized gain on short-term debt investments		-			-			-			-			-			11,771			-			11,771

Net loss		-			-			-			-			-			-			(928,814	)		(928,814	)

Balance, September 30, 2024		4,488,296		$	449		$	20,302,356			3,840		$	(6,268	)	$	19,797		$	(13,534,071	)	$	6,782,263

					Additional						Accumulated Other					Total
	Common Stock				Paid In		Treasury Stock				Comprehensive		Accumulated			Stockholders’
	Shares		Amount		Capital		Shares		Amount		Income (Loss)		Deficit			Equity

Balance, December 31, 2022		3,158,797	$	316	$	17,511,589		-	$	-	$	-	$	(7,171,128	)	$	10,340,777

Accretion of stock options expense to stock based compensation		-		-		4,237		-		-		-		-			4,237

Unrealized gain on short-term debt investments		-		-		-		-		-		5,239		-			5,239

Net loss		-		-		-		-		-		-		(906,396	)		(906,396	)

Balance, March 31, 2023		3,158,797		316		17,515,826		-		-		5,239		(8,077,524	)		9,443,857

Accretion of stock options expense to stock based compensation		-		-		4,237		-		-		-		-			4,237

Purchase of treasury stock		-		-		-		57,335		(130,959

SEC Form 10-Q filed by Silo Pharma Inc.