Form 10-Q Quarterly Report

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED March 31, 2021

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM ________TO ________

Commission File Number: 000-54554

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada

45-1226465

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification No.)

701 Wild Rose Lane

Elk City, Idaho 83525

(Address of principal executive offices, including zip code)

(760) 295-7208

(Registrant’s telephone number, including area code)

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 [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 registrant was required to submit and post such files). Yes [X] 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	[ ]	Non-Accelerated Filer	[X]
Accelerated Filer	[ ]	Smaller reporting company	[X]
		Emerging growth company	[ ]

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

As of May 13, 2021, the Registrant had 2,251,001,716 outstanding shares of Common Stock with a par value of $0.001 per share.

IMPORTANT PREFATORY NOTE

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this report and the information incorporated by reference herein may contain “forward-looking statements” (as such term is defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended). These statements, which involve risks and uncertainties, reflect our current expectations, intentions, or strategies regarding our possible future results of operations, performance, and achievements. Forward-looking statements include, without limitation: statements regarding future products or product development; statements regarding future selling, general and administrative costs and research and development spending; statements regarding our product development strategy; and statements regarding future financial performance, results of operations, capital expenditures and sufficiency of capital resources to fund our operating requirements. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and applicable rules of the Securities and Exchange Commission and common law.

These forward-looking statements may be identified in this report and the information incorporated by reference by words such as “anticipate”, “believe”, “could”, “estimate”, “expect”, “intend”, “plan”, “predict”, “project”, “should” and similar terms and expressions, including references to assumptions and strategies. These statements reflect our current beliefs and are based on information currently available to us. Accordingly, these statements are subject to certain risks, uncertainties, and contingencies, which could cause our actual results, performance, or achievements to differ materially from those expressed in, or implied by, such statements.

The following factors are among those that may cause actual results to differ materially from our forward-looking statements:

·Need for additional capital;

·Limited operating history in our new business model;

·Limited experience introducing new products;

·Our ability to successfully expand our operations and manage our future growth;

·Difficulty in managing our growth and expansion;

·Dilutive effects of any raising of additional capital;

·The deterioration of global economic conditions and the decline of consumer confidence and spending;

·Material weaknesses reported in our internal control over financial reporting;

·Our ability to protect intellectual property rights and the value of our products;

·The potential for product liability claims against us;

·Our dependence on third party manufacturers to manufacture our products;

·Our common stock is currently classified as a penny stock;

·Our stock price may experience future volatility;

·The illiquidity of our common stock; and

·Substantial sales of shares of our common stock.

·Other factors not specifically described above, including the other risks, uncertainties, and contingencies described under “Description of Business”, “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Items 1 and 7 of our Annual Report on Form 10-K for the year ended December 31, 2020.

When considering these forward-looking statements, you should keep in mind the cautionary statements in this report and the documents incorporated by reference. We have no obligation and do not undertake to update or revise any such forward-looking statements to reflect events or circumstances after the date of this report.

Actual results may vary materially from those in such forward-looking statements as a result of various factors. No assurance can be given that the risk factors described in this Quarterly Report on Form 10-Q are all of the factors that could cause actual results to vary materially from the forward-looking statements. References in this Quarterly Report on Form 10-Q to the “Company,” “TSOI,” “we,” “our,” and “us” refer to Therapeutic Solutions International, Inc.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

INDEX

	PART 1. Financial Information	PAGE
Item 1.	Financial Statements (Unaudited)	4

	Condensed Consolidated Balance Sheets as of March 31, 2021 and December 31, 2020	4

	Condensed Consolidated Statements of Operations for the three months ended March 31, 2021 and 2020	5

	Condensed Consolidated Statement of Changes in Shareholders’ Deficit for the Period from January 1, 2021 to March 31, 2021 and January 1, 2020 to March 31, 2020	6

	Condensed Consolidated Statements of Cash Flows for the three months ended March 31, 2021 and 2020	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Item 3. Quantitative and Qualitative Disclosures about Market Risk	28
Item 4.	Item 4. Controls and Procedures	28

	PART II. Other Information
Item 1.	Legal Proceedings	29
Item 1A.	Risk Factors	29
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29
Item 3.	Defaults upon Senior Securities	31
Item 4.	Mine Safety Disclosures	31
Item 5.	Other Information	31
Item 6.	Exhibits	31
	Signatures	32

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Balance Sheets

		March 31, 2021		December 31, 2020
ASSETS		(Unaudited)
Current assets:
Cash and cash equivalents	$	81,113	$	252,147
Restricted cash		10,202		10,202
Accounts receivable		9,479		2,441
Inventory		6,851		5,399
Prepaid expenses and other current assets		170,040		77,328
Total current assets		277,685		347,517

Property and equipment, net		240,087		5,059
Right-of-use asset		52,904		58,976
Other assets		226,741		191,922

Total assets	$	797,417	$	603,474

LIABILITIES AND SHAREHOLDERS' DEFICIT

Current liabilities:
Accounts payable	$	298,035	$	302,477
Accounts payable-related parties		7,210		7,210
Accrued expenses and other current liabilities		568,652		593,925
Lease liability		24,981		24,792
Convertible notes payable, net of discount of $181,806 and $195,162, at March 31, 2021 and December 31, 2020, respectively		104,194		37,338
Notes payable-related parties, net		949,827		944,098
Derivative liabilities		331,618		437,549
Total current liabilities		2,284,517		2,347,389

LONG TERM LIABILITIES
Lease liability, net of current portion		27,923		34,184
TOTAL LIABILITIES		2,312,440		2,381,573

Commitments and contingencies		-		-

Shareholders' Deficit:
Preferred stock, $ 0.001 par value; 5,000,000 shares authorized		-		-
Common stock, $ 0.001 par value; 3,500,000,000 shares authorized; 2,224,453,070 and 2,223,741,391 shares issued and outstanding at March 31, 2021 and December 31, 20120 respectively.		2,244,453		2,233,742
Additional paid-in capital		7,481,248		7,041,960
Subscription receivable		(21,000)		(21,000)
Accumulated deficit		(11,219,724)		(11,032,801)
Total shareholders' deficit		(1,515,023)		(1,778,099)

Total liabilities and shareholders' deficit	$	797,417	$	603,474

See accompanying notes to condensed consolidated financial statements.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Statements of Operations

(Unaudited)

		For the Three Months Ended March 31, 2021		For the Three Months Ended March 31, 2020

Net sales	$	21,061	$	19,514
Cost of goods sold		11,081		3,490

Gross profit		9,980		16,024

Operating expenses:
General and administrative		36,811		15,431
Salaries, wages, and related costs		104,463		53,170
Consulting fees		41,183		37,219
Legal and professional fees		68,752		32,580
Research and development		19,697		-
Total operating expenses		270,906		138,400

Loss from operations		(260,926)		(122,376)

Other income (expense):
Loss on derivatives liabilities		(348,255)		(20,755)
Change in fair value of derivative liabilities		504,186		236,402
Interest expense		(81,928)		(61,135)
Total other income (expense)		74,003		154,512

Net income (loss)	$	(186,923)	$	32,136

Net income (loss) per share - basic	$	(0.00)	$	0.00

Net income (loss) per share - diluted	$	(0.00)	$	0.00

Weighted average shares outstanding – basic		2,240,039,437		1,621,008,777

Weighted average shares outstanding – diluted		2,240,039,437		1,895,283,682

See accompanying notes to condensed consolidated financial statements.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Statements of Changes in Shareholders' Deficit

(Unaudited)

	Common Stock
	Shares		Amount		Additional Paid-in Capital		Subscription Receivable		Accumulated Deficit		Total Stockholders' Deficit
December 31, 2019	1,614,627,811	$	1,614,628	$	5,183,228	$	-	$	(8,832,900)	$	(2,035,044)

Common stock issued for conversion of convertible notes, accrued interest, and derivative liabilities	41,916,221		41,916		(9,916)		-		-		32,000
Relief of derivative liabilities	-		-		-		32,956		-		32,956
Net income	-		-		-		-		32,136		32,136
March 31, 2020	1,656,544,032	$	1,656,544	$	5,206,268	$	-	$	(8,800,764)	$	(1,937,952)

	Common Stock
	Shares		Amount		Additional Paid-in Capital		Subscription Receivable		Accumulated Deficit		Total Stockholders' Deficit
December 31, 2020	2,233,741,391	$	2,233,742	$	7,041,960	$	(21,000)	$	(11,032,801)	$	(1,778,099)

Common stock issued for prepaid fees	2,500,000		2,500		170,000		-		-		172,500
Common stock issued for accrued salaries	4,800,000		4,800		55,200		-		-		60,000
Common stock issued for cash	3,411,679		3,411		214,088		-		-		217,499
Net loss	-		-		-		-		(186,923)		(186,923)
March 31, 2021	2,244,453,070	$	2,244,453	$	7,481,248	$	(21,000)	$	(11,219,724)	$	(1,515,023)

See accompanying notes to condensed consolidated financial statements.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

		For the Nine Months Ended March 31, 2021		For the Nine Months Ended March 31, 2020
Cash flows from operating activities
Net income (loss)	$	(186,923)	$	32,136
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Loss on derivative liabilities		348,255		20,755
Change in fair value of derivative liabilities		(504,186)		(236,402)
Amortization of prepaid stock-based compensation		14,375		-
Amortization of debt discount		66,856		47,769
Patent amortization		1,648		1,648
Depreciation		195		-
Changes in operating assets and liabilities:
Accounts receivable		(7,038)		(721)
Inventory		(1,452)		692
Prepaid expenses and other current assets		21,431		37,219
Right-of-use asset		6,072		(71,422)
Accounts payable		(4,441)		7,562
Accounts payable - related parties		-		(2,015)
Accrued expenses and other current liabilities		41,205		36,942
Lease liability		(6,072)		73,771
Net cash used in operating activities		(210,075)		(52,066)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(235,223)		-
Deposits		7,515		-
Net cash used in investing activities		(227,708)		-

Cash flows from financing activities
Payments on notes payable to related party		(750)		(485)
Proceeds from convertible notes payable		50,000		30,000
Proceeds from sale of common stock		217,499		-
Net cash provided by financing activities		266,749		29,515

Net decrease in cash, cash equivalents and restricted cash		(171,034)		(22,551)
Cash, cash equivalents and restricted cash at beginning of period		262,349		36,597
Cash, cash equivalents and restricted cash at end of period	$	91,315	$	14,046

Supplemental cash flow information:
Cash paid for interest	$	606	$	1,220
Cash paid for income taxes	$	-	$	-

Non-cash investing and financing transactions:
Original issuance discount on convertible notes payable	$	3,500	$	3,000
Debt discount recorded in connection with derivative liability	$	50,000	$	30,000
Common stock issued in conversion of convertible notes payable and interest	$	-	$	64,956
Common stock issued for prepaid fees	$	172,500	$	-
Common stock issued for accrued salaries	$	60,000	$	-
Accrued interest added to principal	$	6,478	$	12,147


Reconciliation of cash, cash equivalents and restricted cash to the consolidated balance sheets:
Cash and cash equivalents	$	81,113	$	3,859
Restricted cash		10,202		10,187
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows:	$	91,315	$	14,046

See accompanying notes to condensed consolidated financial statements.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 1 – Organization and Business Description

Therapeutic Solutions International, Inc. (“TSOI” or the “Company”) was organized August 6, 2007 under the name Friendly Auto Dealers, Inc., under the laws of the State of Nevada. In the first quarter of 2011 the Company changed its name from Friendly Auto Dealers, Inc. to Therapeutic Solutions International, Inc., and acquired Splint Decisions, Inc., a California corporation.

On December 17, 2020, Therapeutic Solutions International, Inc. Board of Directors made a decision to move our corporate headquarters to Elk City, Idaho 83525 and has purchased real property at 701 Wild Rose Lane and 50 Bullock Lane, Elk City Idaho 83525. The Company will continue to maintain a satellite office at the current address of 4093 Oceanside Blvd., Suite B, Oceanside CA, 92056.

Business Description

Currently the Company is focused on immune modulation for the treatment of several specific diseases. Immune modulation refers to the ability to upregulate (make more active) or downregulate (make less active) one’s immune system.

Activating one’s immune system is now an accepted method to treat certain cancers, reduce recovery time from viral or bacterial infections and to prevent illness. Additionally, inhibiting one’s immune system is vital for reducing inflammation, autoimmune disorders and allergic reactions.

TSOI is developing a range of immune-modulatory agents to target certain cancers, schizophrenia, suicidal ideation, traumatic brain injury, and for daily health.

Nutraceutical Division – TSOI has been producing high quality nutraceuticals. Its current flagship product, NanoStilbeneä PKE, is prepared by low-energy emulsification which allows for better solubility, stability, and the release performance of pterostilbene nanoparticles. The pterostilbene placed in a nanoemulsion droplet is free from air, light, and hard environment; therefore, as a delivery system, nanoemulsion’s can improve the bioavailability of pterostilbene but also protect it from oxidation and hydrolysis, while it possesses an ability of sustained release at the same time. Recently the Company was approved to sell certain nutraceuticals on the Amazon Platform. In addition to this our products are now listed in RangeMe. RangeMe.com is an online platform that enables retail buyers to efficiently discover innovative and emerging products while empowering suppliers to manage and grow their brands with the tools, insights, and services they need. With 10,000+ Retail buyers our products are now placed in front of them in our category of dietary supplements and nutraceuticals.

Cellular Division – TSOI recently obtained exclusive rights to a patented adult stem cell for development of therapeutics in the area of chronic traumatic encephalopathy (CTE) and traumatic brain injury (TBI) and Lung Pathology (LP).

The stem cell licensed, termed “JadiCell” is unique in that it possesses features of mesenchymal stem cells, however, outperforms these cells in terms of a) enhanced growth factor production; b) augmented ability to secrete exosomes; and c) superior angiogenic and neurogenic ability.

Chronic Traumatic Encephalopathy (CTE) is caused by repetitive concussive/sub-concussive hits to the head sustained over a period of years and is often found in football players. The condition is characterized by memory loss, impulsive/erratic behavior, impaired judgment, aggression, depression, and dementia. In many patients with CTE, it is anatomically characterized by brain atrophy, reduced mass of frontal and temporal cortices, and medial temporal lobe. TSOI has previously filed several patents in the area of CTE based on modulating the brain microenvironment to enhance receptivity of regenerative cells such as stem cells. On March 4, 2021 the Company received an IND Serial # 27377 for a clinical trial of 10 patients with CTE.

In addition, the Company has filed data with the FDA, as part of IND #17448, which demonstrated that treatment of cancer patients with StemVacs resulted in enhanced activity of a type of immunological cell called “natural killer” cells, otherwise known as “NK cells.”

The Company has also developed an allogenic version of StemVacs and has filed patents to cover activating universal donor immune system cells called dendritic cells in a manner so that upon injection they reprogram the body’s NK cells.

Most recently the Company announced filing of a patent for a new hybrid cell created by the Company capable of training the immune system to kill blood vessels feeding cancer but sparing healthy blood vessels. These discoveries are an extension of previous findings from the Company showing that StemVacs is capable of suppressing new blood vessel production.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 1 – Organization and Business Description (Continued)

Management does not expect existing cash as of March 31, 2021 to be sufficient to fund the Company’s operations for at least twelve months from the issuance date of these financial statements. These financial statements have been prepared on a going concern basis which assumes the Company will continue to realize its assets and discharge its liabilities in the normal course of business. As of March 31, 2021, the Company has incurred losses totaling $11.2 million since inception, has not yet generated material revenue from operations, and will require additional funds to maintain its operations. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern within one year after the consolidated financial statements are issued. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they become due. The Company intends to finance operating costs over the next twelve months through its existing financial resources and we may also raise additional capital through equity offerings, debt financings, collaborations and/or licensing arrangements. If adequate funds are not available on acceptable terms, we may be required to delay, reduce the scope of, or curtail, our operations. The accompanying consolidated financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts.

Note 2 – Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (GAAP) for interim financial information and with the instructions to Form 10-Q and Article 8 of the Securities and Exchange Commission (SEC) Regulation S-X, and should be read in conjunction with the audited financial statements and notes thereto for the year ended December 31, 2020, included in the Company’s Annual Report on Form 10-K filed with the SEC on April 9, 2021. The accompanying unaudited condensed consolidated financial statements include the accounts of TSOI and its subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. The unaudited condensed consolidated financial statements contain all normal recurring accruals and adjustments that, in the opinion of management, are necessary to present fairly the balances and results for the interim period included herein. The results of operations for the three months ended March 31, 2021 and 2020 are not necessarily indicative of the results to be expected for the full year or any future interim periods. The accompanying condensed consolidated balance sheet at December 31, 2020 has been derived from the audited consolidated balance sheet at December 31, 2020, contained in the above referenced Form 10-K.

Principles of Consolidation

The accompanying consolidated financial statements include the accounts of Therapeutic Solutions International, Inc. and its subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

Revenue Recognition

The Company recognizes revenue in accordance with ASC 606, “Revenue from Contracts with Customers” (“ASC 606”). In accordance with ASC 606, the Company applies the following methodology to recognize revenue:

1)Identify the contract with a customer.

2)Identify the performance obligations in the contract.

3)Determine the transaction price.

4)Allocate the transaction price to the performance obligations in the contract.

5)Recognize revenue when (or as) the entity satisfies a performance obligation.

ASC 606 provides that sales revenue is recognized when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The Company generally satisfies performance obligations upon shipment of the product or service to the customer. This is consistent with the time in which the customer obtains control of the product or service.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 2 – Summary of Significant Accounting Policies (Continued)

Cash and Cash Equivalents

The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.

Derivative Liabilities

A derivative is an instrument whose value is “derived” from an underlying instrument or index such as a future, forward, swap, option contract, or other financial instrument with similar characteristics, including certain derivative instruments embedded in other contracts and for hedging activities.

As a matter of policy, the Company does not invest in separable financial derivatives or engage in hedging transactions. However, the Company entered into certain debt financing transactions in fiscal 2021 and 2020, as disclosed in Note 5, containing certain conversion features that have resulted in the instruments being deemed derivatives. We evaluate such derivative instruments to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

Instruments classified as derivative liabilities are remeasured using the Black-Scholes model at each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations. We recorded derivative liabilities of $331,618 and $437,549 at March 31, 2021 and December 31, 2020, respectively.

Fair Value of Financial Instruments

The Company’s financial instruments consist of cash and cash equivalents, prepaids, convertible notes, and payables. The carrying amount of cash and cash equivalents and payables approximates fair value because of the short-term nature of these items.

Fair value is an exit price, representing the amount that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. Fair value measurements are required to be disclosed by level within the following fair value hierarchy:

Level 1 – Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level 2 – Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.

Level 3 – Inputs lack observable market data to corroborate management’s estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

When determining fair value, whenever possible the Company uses observable market data, and relies on unobservable inputs only when observable market data is not available. As of March 31, 2021, the Company has level 3 fair value calculations on derivative liabilities. The table below reflects the results of our Level 3 fair value calculations:

The following is the change in derivative liabilities for the three months ended March 31, 2021:

Balance, December 31, 2020	$	437,549
Issuance of new derivative liabilities		398,255
Change in fair market value of derivative liabilities		(504,186)
Balance, March 31, 2021	$	331,618

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 2 – Summary of Significant Accounting Policies (Continued)

Use of Estimates

The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America 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 balance sheet and the reported amounts of revenues and expenses during the reporting period. Estimates were made relating to valuation allowances, impairment of assets, share-based compensation expense and accruals. Actual results could differ materially from those estimates.

Net Income (Loss) Per Share

Basic income (loss) per share is computed by dividing net income (loss) available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted income (loss) per share is computed similar to basic income (loss) per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. In periods in which a net loss is incurred, basic and diluted loss per share are the same, and additional potential common shares are excluded as their effect would be antidilutive.

For the periods ended March 31, 2021 and 2020, a total of 454,438,795 and 1,099,838,839, respectively, potential common shares, consisting of shares underlying outstanding convertible notes payable were excluded as their inclusion would be antidilutive due to the net loss during the period.

Property and Equipment

Property and equipment are recorded at cost, less accumulated depreciation. Expenditures for major additions and improvements are capitalized and minor replacements, maintenance, and repairs are charged to expense as incurred. When property and equipment are retired or otherwise disposed of, the cost and accumulated depreciation are removed from the accounts and any resulting gain or loss is included in the results of operations for the respective period. Depreciation is calculated using the straight-line method over the term of the agreement. Depreciation expense for the three months ended March 31, 2021 and 2020 was $195 and $0, respectively.

Intangible Assets

Intangible assets consisted primarily of intellectual properties such as proprietary nutraceutical formulations. Intellectual assets are capitalized in accordance with ASC Topic 350 “Intangibles – Goodwill and Other.” Intangible assets with finite lives are amortized over their respective estimated lives and reviewed for impairment whenever events or other changes in circumstances indicate that the carrying amount may not be recoverable. Amortization expense for the three months ended March 31, 2021 and 2020 was $1,648 and $1,648, respectively.

Long-lived Assets

In accordance with ASC 360, Property, Plant and Equipment, the carrying value of intangible assets and other long-lived assets is reviewed on a regular basis for the existence of facts or circumstances that may suggest impairment. The Company recognizes impairment when the sum of the expected undiscounted future cash flows is less than the carrying amount of the asset. Impairment losses, if any, are measured as the excess of the carrying amount of the asset over its estimated fair value.

Research and Development

Research and Development costs are expensed as incurred. Research and Development expenses were $19,697 and $0 for the three months ended March 31, 2021 and 2020, respectively.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 2 – Summary of Significant Accounting Policies (Continued)

Income Taxes

The Company accounts for income taxes under ASC 740 "Income Taxes," which codified SFAS 109, "Accounting for Income Taxes" and FIN 48 “Accounting for Uncertainty in Income Taxes – an Interpretation of FASB Statement No. 109.” Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statements carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period the enactment occurs. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

Stock-Based Compensation

Compensation expense for stock issued to employees is determined as the fair value of consideration or services received or the fair value of the equity instruments issued, whichever is more reliably measured. The Financial Accounting Standards Board (FASB) issued ASU 2018-07 to expand the scope of Topic 718 to include share-based payments issued to nonemployees.

Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The new standard requires lessees to recognize most leases on their balance sheets as lease liabilities with corresponding right-of-use assets and eliminates certain real estate-specific provisions. The Company recorded a Right-of-use asset of $52,904 and a Lease Liability of $52,904 as of March 31, 2021.

Recent Accounting Pronouncements

In December 2019, the FASB issued guidance that simplifies the accounting for income taxes by removing certain exceptions in existing guidance and improves consistency in application by clarifying and amending existing guidance. This guidance is effective for annual periods beginning after December 15, 2020, and interim periods within those annual periods, where the transition method varies depending upon the specific amendment. Early adoption is permitted, including adoption in any interim period. An entity that elects to early adopt the amendments in an interim period should reflect any adjustments as of the beginning of the annual period that includes that interim period, and all amendments must be adopted in the same period. The Company has reviewed the provisions of the new standard, but it is not expected to have a significant impact on the Company.

In January 2020, the FASB issued Accounting Standards Update (“ASU”) No. 2020-01, "Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323), and Derivatives and Hedging (Topic 815): Clarifying the Interactions between Topic 321, Topic 323, and Topic 815", which clarifies the interaction of the accounting for equity securities under Topic 321 and investments accounted for under the equity method of accounting under Topic 323, and the accounting for certain forward contracts and purchased options accounted for under Topic 815. This guidance is effective for the Company for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. The Company has reviewed the provisions of the new standard, but it is not expected to have a significant impact on the Company.

In August 2020, the FASB issued Accounting Standards (“ASU”) No. 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which clarifies if an entity must determine whether a contract qualifies for a scope exception from derivative accounting. This guidance must be applied to freestanding financial instruments and embedded features that have all the characteristics of a derivative instrument and freestanding financial instruments that potentially are settled in an entity’s own stock, regardless of whether the instrument has all the characteristics of a derivative instrument. The analysis to determine whether a contract meets this scope exception includes two criteria: (1) the contract is indexed to an entity’s own stock and (2) the contract is equity classified. If both of those criteria are not met, the contract must be recognized as an asset or a liability. Under Section 815-40-25 on recognition, an entity must determine whether a contract meets specific conditions to be classified as equity (referred to as the settlement criterion). This guidance is effective for the Company for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted. The Company has reviewed the provisions of the new standard, but it is not expected to have a significant impact on the Company.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 3 - Restricted Cash

Included in cash and non-cash equivalents is a $10,000 certificate of deposit with an annual interest rate of 0.6%. This certificate matures on June 17, 2021 and is used as collateral for a Company credit card, pursuant to a security agreement dated June 20, 2011.

Note 4 – Prepaid expense and other current assets

Prepaid expenses and other current assets consist of the following:

		March 31, 2021		December 31, 2020
Prepaid consulting	$	168,276	$	76,663
Insurance		646		665
Prepaid costs		1,118		-
Total	$	170,040	$	77,328

Note 5 – Property and Equipment

Fixed assets consisted of the following:

		March 31, 2021		December 31, 2020
Computer hardware	$	10,747	$	10,747
Office furniture and equipment		3,639		3,639
Shipping and other equipment		7,023		7,023
Land		235,223		-
Total		256,632		21,409
Accumulated depreciation		(16,545)		(16,350)
Property and equipment, net	$	240,087	$	5,059

Depreciation expense for the three months ended March 31, 2021 and 2020 was $195 and $0, respectively.

Note 6 – Other Assets

Other assets consist of the following:

		March 31, 2021		December 31, 2020
Prepaid consulting	$	83,896	$	39,914
Deposit		4,123		11,638
Licenses, net		138,722		140,370
Total	$	226,741	$	191,922

Prepaid consulting agreements are for one to two years and are expensed monthly over the term of the agreement. The net licenses amount consists of the following:

		March 31, 2021		December 31, 2020
License	$	153,552	$	153,552
Accumulated amortization		(14,830)		(13,182)
Licenses, net	$	138,722	$	140,370

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 7 - Notes Payable-Related Party

At March 31, 2021 and December 31, 2020, the Company has unsecured interest-bearing demand notes outstanding to certain officers and directors amounting to $949,827 and $944,098, respectively. Interest accrued on these notes during the three months ended March 31, 2021 and 2020 was $6,478 and $6,837, respectively. Of these, $251,000 are convertible into common stock at prices ranging from $0.004 and $0.005.

Note 8 – Convertible Notes Payable

In January 2021, the Company entered into a convertible promissory note with principal amount totaling $53,500 with a third party for which the proceeds were used for operations. The Company received net proceeds of $50,000, and a $3,500 original issuance discount was recorded. As of March 31, 2021, the Company also had outstanding convertible promissory notes with principal totaling $232,500 issued at various dates throughout the year ended December 31, 2020. The convertible promissory notes incur interest at 12% per annum and mature on dates ranging from October 5, 2021 to January 25, 2022. The convertible promissory notes are convertible to shares of the Company's common stock 180 days after issuance. The conversion price per share is equal to 61% of the average of the three (3) lowest trading prices of the Company's common stock during the fifteen (15) trading days immediately preceding the applicable conversion date. The trading price is defined within the agreement as the closing bid price on the applicable trading market. The Company has the option to prepay the convertible notes in the first 180 days from closing subject to prepayment penalties ranging from 120% to 145% of principal balance plus interest, depending upon the date of prepayment. The convertible promissory notes include various default provisions for which the default interest rate increases to 22% per annum with the outstanding principal and accrued interest increasing by 150%. The Company was required to reserve at March 31, 2021 a total of 454,438,795 common shares in connection with these promissory notes.

Derivative liabilities

These convertible promissory notes are convertible into a variable number of shares of common stock for which there is not a floor to the number of common stock we might be required to issue. Based on the requirements of ASC 815 Derivatives and Hedging, the conversion feature represented an embedded derivative that is required to be bifurcated and accounted for as a separate derivative liability. The derivative liability is originally recorded at its estimated fair value and is required to be revalued at each conversion event and reporting period. Changes in the derivative liability fair value are reported in operating results each reporting period.

For the note issued during the three months ended March 31, 2021, the Company valued the conversion feature on the date of issuance resulting in an initial liability of $398,255. Since the fair value of the derivative was in excess of the proceeds received of $50,000, a full discount to convertible notes payable and a day one loss on derivative liabilities of $348,255 was recorded during the three months ended March 31, 2021. Upon issuance, the Company valued the conversion feature using the Black-Scholes option pricing model with the following assumptions: conversion price of $0.0039, the closing stock price of the Company's common stock on the date of valuation of $0.031, an expected dividend yield of 0%, expected volatility of 255%, risk-free interest rate of 0.18%, and an expected term of one year.

On March 31, 2021, the derivative liabilities on the five convertible notes were revalued at $331,618 resulting in a gain of $504,186 for the three months ended March 31, 2021 related to the change in fair value of the derivative liabilities. The derivative liabilities were revalued using the Black-Scholes option pricing model with the following assumptions: exercise price of $0.0454, the closing stock price of the Company's common stock on the date of valuation of $0.073, an expected dividend yield of 0%, expected volatility of 231%, risk-free interest rate of 0.18%, and an expected term ranging from 0.5 to 0.8 years.

The Company amortizes the discounts over the term of the convertible promissory notes using the straight-line method which is similar to the effective interest method. During the three months ended March 31, 2021 and 2020, the Company amortized $66,856 and $47,769 to interest expense, respectively. As of March 31, 2021, discounts of $181,806 remained for which will be amortized through January 2022.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 9 – Equity

Our authorized capital stock consists of an aggregate of 3,505,000,000 shares, comprised of 3,500,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred stock, which may be issued in various series from time to time and the rights, preferences, privileges and restrictions of which shall be established by our board of directors. As of March 31, 2021, we have 2,244,453,070 shares of common stock and no preferred shares issued and outstanding.

In 2020, we issued 192,375,737 shares of common stock for an investment in the Company’s Private Placement of $607,500.

In 2020, we issued 173,500,000 shares of common stock, valued at $669,750 for consulting services.

In 2020, we issued 78,681,818 shares of common stock, valued at $495,900 for salaries.

In 2020, we issued 174,556,025 shares of common stock for the conversion of convertible notes of $703,152.

In 2021, we issued 3,411,679 shares of common stock for an investment in the Company’s Private Placement of $217,500.

In 2021, we issued 2,500,000 shares of common stock, valued at $172,500 for consulting services.

In 2021, we issued 4,800,000 shares of common stock, valued at $60,000 for salaries.

Note 10– Subsequent Events

On April 12, 2021, we issued 1,771,758 shares of common stock for the partial conversion of $61,480 for convertible note dated October 19, 2020.

On April 12, 2021, we issued 923,728 shares of common stock for $54,500 of accrued salaries.

On April 12, 2021, we issued 500,000 shares of common stock, valued at $0.059 per share, for consulting services.

On April 19, 2021, we issued 500,000 shares of common stock, valued at $0.054per share, for consulting services.

On April 19, 2021, we issued 160,000 shares of common stock, valued at $0.05 per share, for an investment in the Company’s Private Placement.

On April 20, 2021, we issued 2,693,160 shares of common stock for the complete conversion of $18,044 for convertible note dated October 19, 2020.

In accordance with ASC 855, the Company has analyzed its operations subsequent to March 31, 2021 through the date these financial statements were issued, and has determined that it does not have any other material subsequent events to disclose in these financial statements.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2021

Note 11 – Commitments and Contingencies

Effective May 1, 2017, the Company entered into a fourth amendment to a Lease Agreement for property located in Oceanside, CA. On March 1, 2020, the Company entered into a fifth amendment to the lease agreement for property located in Oceanside, CA. The amendment extends the expiration date to April 20, 2023 with escalating monthly payments ranging from $2,024 to $2,153. The lease consists of approximately 1,700 square feet. Total rent expense for the three months is $6,072.

Future minimum lease payments as of March 31, 2021 are as follows:

For the quarter ending December 31,

2022	$	25,572
2023		8,612

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis contains forward-looking statements within the meaning of the federal securities laws. The safe harbor provided in section 27A of the Securities Act of 1933 and section 21E of the Securities Exchange Act of 1934 (“statutory safe harbors”) shall apply to forward-looking information provided pursuant to the statements made in this filing by the Company. We urge you to carefully review our description and examples of forward-looking statements included in the section entitled “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this report. Forward-looking statements speak only as of the date of this report and we undertake no obligation to publicly update any forward-looking statements to reflect new information, events or circumstances after the date of this report. Actual events or results may differ materially from such statements. In evaluating such statements, we urge you to specifically consider various factors identified in this report, any of which could cause actual results to differ materially from those indicated by such forward-looking statements. The following discussion and analysis should be read in conjunction with the accompanying financial statements and related notes, as well as the Financial Statements and related notes in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and the risk factors discussed therein.

General

Our principal executive office is located at 701 Wild Rose Lane, Elk City, Idaho, 83525, our telephone number is (760) 295-7208 and our website is www.therapeuticsolutionsint.com. The reference to our website does not constitute incorporation by reference of the information contained on our website.

We file our quarterly and annual reports with the Securities and Exchange Commission (SEC), which the public may view and copy at the SEC’s Public Reference Room at 100 F Street, N.E. Washington D.C. 20549, on official business days during the hours of 10 a.m. to 3 p.m. The public may obtain information on the operation of the SEC’s Public Reference Room by calling the SEC at 1–800–SEC–0330. The SEC also maintains an Internet site, the address of which is www.sec.gov, which contains reports, proxy and information statements, and other information regarding issuers which file electronically with the SEC. The periodic and current reports that we file with the SEC can also be obtained from us free of charge by directing a request to Therapeutic Solutions International, Inc., 4093 Oceanside Blvd, Suite B, Oceanside, California 92056, Attn: Corporate Secretary.

DESCRIPTION OF BUSINESS

CURRENT BUSINESS DESCRIPTION

Business Description

TSOI is developing a range of immune-modulatory agents to target certain cancers, schizophrenia, suicidal ideation, traumatic brain injury, and for daily health.

Most recently the Company announced filing of a patent for a new hybrid cell created by the Company capable of training the immune system to kill blood vessels feeding cancer, but sparing healthy blood vessels. These discoveries are an extension of previous findings from the Company showing that StemVacs is capable of suppressing new blood vessel production.

Nutraceutical Division (TSOI)

·ProJuvenol^® is a patented, (US No.: 9,682,047) and powerful synergistic blend of complex anti-aging ingredients in capsules.

·NanoStilbeneä is an easily absorbed nanoemulsion of nanoparticle pterostilbene derived from the ‘047 patent.

·DermalStilbene is a topical form of pterostilbene delivered via spray application onto skin, derived from the ‘047 patent.

·IsoStilbene an injectable formulation of pterostilbene is available by prescription only, derived from the ‘047 patent.

·NeuroStilbene is an intranasal form of pterostilbene delivered via spray application inside the nostril, derived from the ‘047 patent.

·NanoPlus is a blend of NanoStilbene and Nano Cannabidiol which are an easily absorbed Nanoparticles formulation of Pterostilbene and Cannabidiol.

·Nano Cannabidiol is an easily absorbed Nanoparticle formulation of Cannabidiol Isolate in the range of 75-90 nanometers. This product is built on the same nano platform as NanoStilbene and is delivered at a concentration of 200mg per milliliter.

·NanoPSA is a blend of NanoStilbene™ and Broccoli Sprout Extract (BSE) providing 74mg of BSE and 125mg of our patented NanoStilbene, a proprietary formulation of nanoparticle pterostilbene.

·NLRP3 Trifecta is a two-product combo and consists of one bottle of NanoPSA and one bottle of GTE-50 green tea extract.

·QuadraMune™ is a synergistic blend of pterostilbene, sulforaphane, epigallocatechingallate, and thymoquinone.

Patents:

TSOI filed a patent in July 2015 covering the use of its ProJuvenol® product, as well as various pterostilbene compositions, for use in augmenting efficacy of existing immuno-oncology drugs that are currently on the market. The patent is based on the ability of pterostilbene, one of the major ingredients of ProJuvenol®, to reduce oxidative stress produced by cancer cells, which in turn protects the immune system from cancer mediated immune suppression. That patent, U.S. No.: 9,682,047 was granted on 6-20-2017.

In addition, on April 28, 2016, the Company filed a patent application covering the use of ProJuvenol© and its active ingredient pterostilbene for augmentation of stem cell activity. Diseases such as diabetes, cardiovascular disease, and neurodegenerative diseases are characterized by deficient stem cell activity. The patent covers the stimulation of stem cells that already exist in the patient’s body, as well as stem cells that are administered therapeutically. Studies have shown that patients who have higher levels of endogenous stem cell activity have reduced cardiovascular disease risk and undergo accelerated neurological recovery after stroke as compared to patients with lower numbers of such stem cells.

On October 16, 2017, the Company filed a patent application titled "Synergistic Inhibition of Glioma Using Pterostilbene and Analogues Thereof" which was developed to utilize the ability of the immune system to augment the possibility of increasing overall survival of glioma patients after treatment with conventional therapies. Our data suggests that when pterostilbene is combined with brain cancer therapeutics such as Gefitinib, Sertraline, or Temozolomide, the prognosis is vastly improved.

On August 13, 2018, the Company filed a patent application titled “Enhancement of Ozone Therapy using Pterostilbene” showing pterostilbene potently augments killing of breast cancer, prostate cancer, and ovarian cancer cells by ozone therapy. The data obtained is an extension of ongoing work at the Company seeking to identify means of enhancing the effects of pterostilbene administration for treatment of a variety of cancers, as well as enhancing the efficacy of existing cancer therapies.

On September 17, 2018, the Company filed a patent application titled “Pterostilbene and Compositions Thereof for Prevention and Treatment of Chronic Traumatic Encephalopathy” with new data demonstrating the ability of its NeuroStilbene intranasal formulation of pterostilbene to successfully prevent the development of brain injury in an animal model of Chronic Traumatic Encephalopathy aka CTE.

On September 25, 2018, the Company filed a patent application titled “Pterostilbene and Formulations Thereof for Treatment of Pathological Immune Activation” covering novel clinical data using its NanoStilbene™ formulation to reduce inflammatory cytokine production in cancer patients.

On September 9, 2019, the Company filed a patent application titled “Pterostilbene and Formulations Thereof for Protection of Hematopoiesis from Chemotherapy and Radiation” covering the ability of NanoStilbene™ and its active ingredient, pterostilbene, at accelerating recovery of blood cells after treatment with chemotherapy.

On November 4, 2019, the Company filed a patent application titled “Cellular, Organ, and Whole-Body Rejuvenation Utilizing Cord Blood Plasma and Pterostilbene” suggesting that pterostilbene, the active ingredient in commercially available NanoStilbene™, augments the ability of cord blood plasma to suppress biological properties associated with aging.

On May 4, 2020, the Company filed a patent application titled “Nutraceuticals for the Prevention, Inhibition and Treatment of SARS-Cov-2 and Associated COVID-19” developed to address issues of susceptibility, inflammation, and viral immunity, for COVID-19 patients.

On May 11, 2020, the Company filed a patent application titled “Treatment of COVID-19 Lung Injury Using Umbilical Cord Plasma Based Compositions” covers new data in which combinations of pterostilbene and other compounds with cord blood are shown to be capable of suppressing lung inflammation associated with COVID-19 in an animal model.

On June 11, 2020, the Company filed a patent application titled “Nutraceuticals for Reducing Myeloid Suppressor Cells” showing QuadraMune reduces the number and activity of immune inhibitory cells termed “myeloid suppressor cells.”

On June 15, 2020, the Company filed a patent application titled “Nutraceuticals for Suppressing Indolamine 2,3 Deoxygenase” from new data showing QuadraMune™ significantly inhibited inflammation associated with memory impairment, as well as reduced levels of kynurenine. Elevation of kynurenine is associated with activation of indolamine 2,3 deoxygenase, an enzyme associated with inflammation and depression.

On June 22, 2020, the Company filed a patent application titled “Treatment of SARS-CoV-2 with Dendritic Cells for Innate and/or Adaptive Immunity” with new data showing its clinical-stage cancer immunotherapeutic product StemVacs™ appears to reduce innate immune induced inflammation in lungs while stimulating immune cells known to possess antiviral properties. StemVacs™ is a cell-based drug comprised of dendritic cells activated in a proprietary manner which when administered stimulates a type of immune system cell termed “natural killer” or NK cells. Numerous studies have shown that NK cells are involved in protecting the body from cancer and from viruses. The FDA has allowed for clinical trials of COVID-19 patients using an NK cell-based drug termed CYNK-001.

On June 30, 2020, the Company filed a patent application titled “Augmentation of Natural Killer Cell Activity and Induction of Cytotoxic Immunity Using Leukocyte Lysate Activated Allogeneic Dendritic Cells: StemVacs™” which describes the process of preparing allogeneic dendritic cells utilizing a leukocyte lysate based approach. These data support development of StemVacs for conditions that would benefit from NK activation such as cancer and COVID-19.

On July 13, 2020, the Company filed a patent application titled “Prevention of Pathological Coagulation in COVID-19 and other Inflammatory Conditions” with new data showing that the ingredients of QuadraMune™ suppress expression of an inflammation stimulated molecule which is known to induce coagulation of blood. Inhibition of this coagulation-promoting molecule, called Tissue Factor, was synergistic with all four ingredients of QuadraMune™ when combined. Tissue Factor is known to be associated with COVID-19 disease and is the culprit for clotting associated conditions such as deep vein thrombosis and atherothrombosis.

On July 22, 2020, the Company filed a patent application titled “Additive and/or Synergistic Combinations of Metformin with Nutraceuticals for the Prevention, Inhibition and Treatment of SARS-Cov-2 and Associated COVID-19” showing potent synergy between QuadraMune™ and the antidiabetic drug metformin in treating COVID-19 associated lung damage models. It was discovered that the ability of QuadraMune™ to protect the lungs from inflammation that resembles coronavirus-induced pathology is markedly amplified by concurrent administration of metformin. At a mechanistic level, it was shown that metformin increased the ability of QuadraMune™ to a) increase the number of “healing macrophages” (“M2” macrophages); b) augment production of anti-inflammatory and regenerative proteins; and c) suppress production of pathological inflammatory proteins.

On July 28, 2020, the Company filed a patent application titled “Neuroprotection and Neuroregeneration by Pterostilbene and Compositions Thereof” with new data demonstrating that the blueberry derived compound pterostilbene possesses numerous brain protective and potentially brain regenerative activities. The data disclosed by the Company indicates: a) pterostilbene suppresses inflammatory cytokines TNF-alpha, IL-1 beta and IL-6; b) pterostilbene inhibits death of neurons caused by inflammatory mediators; c) pterostilbene stimulates production of regenerative factors from cells in the brain such as BDNF, NGF, FGF-1, and FGF-2; and d) pterostilbene allows/enhances proliferation of endogenous brain stem cells.

On August 05, 2020 the Company filed a patent application titled “Prevention of Neuroinflammation associated Memory Loss Using Nutraceutical Compositions” which discloses means, methods, and therapeutic compositions for prevention of memory loss during situations of neuroinflammation.

On August 21, 2020 the Company filed a patent application titled “Methods of Determining Risk of Suicide and/or Suicidal Ideation by Immunological Assessment” which discloses means and methods of identifying risk of suicide and/or suicidal ideation by assessment of immunologically related cytokines and cells. In one embodiment, a score, termed the “Campbell Score” is devised based on assessment of serum cytokines, ability of immune cells to make cytokines when stimulated ex vivo, and ability of immune cells to produce neurotransmitters when stimulated ex-vivo.

On August 28, 2020 the Company filed a patent application titled “Upregulation of Therapeutic T Regulatory Cells and Suppression of Suicidal Ideations in Response to Inflammation by Administration of Nutraceutical Compositions Alone or Combined with Minocycline” which discloses compositions of matter, treatments and protocols useful for induction of T regulatory cells in response to inflammation, as well as inhibition of suicidal ideations and/or neuroinflammation. In some embodiments the invention teaches the administration of a therapeutic combination of ingredients comprising of minocycline, pterostilbene, nigella sativa, sulforaphane, and epigallocatechin-3-gallate (EGCG) to a mammal undergoing upregulation of inflammatory mediators.

On September 14, 2020, the Company filed a patent application titled “Immunotherapy of Schizophrenia and Schizophrenia Associated Suicidal Ideation/Suicide” Disclosed are methods, means, and protocols of modifying the immune system so as to induce an immunologically tolerant state insofar as T regulatory cell number and/or activity is augmented in a patient suffering from schizophrenia. In one embodiment T regulatory cells are administered to the patient from exogenous sources, be they allogeneic or autologous. In other embodiments, T regulatory cells are generated endogenously through administration of immature dendritic cells, mesenchymal stem cells, and/or pharmaceutical means.

On September 24, 2020, the Company filed a patent application titled “Personalized Immunotherapies for Reduction of Brain Inflammation and Suicide Prevention” that discloses means, methods and compositions of matter useful for reduction of brain inflammation and prevention of suicidal ideations and suicidal attempts. In one embodiment the invention provides utilization of autologous platelet rich plasma, alone, or admixed with regenerative/anti-inflammatory adjuvants, for reduction of neural inflammation. In one embodiment autologous PRP is admixed with oxytocin and administered intranasally in a patient at risk of suicidal ideation. In another embodiment, PRP is admixed with fortified and non-fortified nigella sativa oil and administered intranasally. Other embodiments include utilization of autologous stromal vascular fraction cells alone and/or admixed with regenerative/anti-inflammatory adjuvants.

On October 18, 2020, the Company filed a patent application titled “Nutraceutical Reduction Prevention and/or Reversion of Multiple Sclerosis” that discloses compositions of matter, protocols, and treatment means for preventing and/or reversing multiple sclerosis in a mammal. In one embodiment administration of compositions containing pterostilbene, and/or nigella sativa, and/or sulforaphane, and/or epigallocatechin-3-gallate (EGCG) are provided.

On October 27, 2020, the Company filed a patent application titled “”Protection/Regeneration of Neurological Function by Endothelial Protection/Rejuvenation using Stem Cells for Treatment of Conditions such as Chronic Traumatic Encephalopathy and Schizophrenia” which therapeutic compounds, protocols, and compositions of matter useful for treatment of neurological conditions. In one embodiment the invention teaches the treatment of chronic traumatic encephalopathy (CTE) through protecting/regenerating the endothelial by administration of cells such as stem cells. In one embodiment stem cells are administered in order to protect the endothelium from apoptosis and to preserve the blood brain barrier. In another embodiment stem cells are administered together with endothelial progenitor cells in order to regenerate neural endothelium. In other embodiments preservation of brain integrity in conditions of degeneration is accomplished by administration of stem cells and/or endothelial cells.

On November 24, 2020, the Company filed a patent application titled “Stimulation of NK Cell Activity by QuadraMune Alone and together with Metformin” that disclosed means, compounds, and compositions of matter useful for stimulation of natural killer cell activity. In some embodiments the invention teaches the administration of a therapeutic combination of ingredients comprising of metformin, pterostilbene, nigella sativa, sulforaphane, and epigallocatechin-3-gallate (EGCG) to a mammal in need of natural killer cell immune modulation. In another embodiment, the invention teaches administration of said therapeutic combination to a mammal infected with said SARS-CoV-2. In some embodiments dosage of said therapeutic combination is based on inflammatory and/or immunological parameters observed in patients with COVID-19.

On December 8, 2020 the Company filed a patent application titled "Treatment of Major Depressive Disorder and Suicidal Ideations Through Stimulation of Hippocampal Neurogenesis Utilizing Plant-Based Approaches" that teaches means and methods of treating major depressive disorder and/or other disorders that predispose to suicide by administration of nutraceutical means, wherein said nutraceuticals are administered at a frequency and/or concentration sufficient to induce proliferation of endogenous neural progenitor cells. In one embodiment said nutraceuticals are comprised of green tea extract, and/or nigella sativa, and/or pterostilbene, and/or sulforaphane. In some embodiment’s nutraceutical compositions are utilized to overcome treatment resistant of currently used antidepressants.

On December 21, 2020 the Company filed a patent application titled “Immunotherapy for Opioid Addiction” which teaches means, methods and compositions of matter useful for reduction of brain inflammation and prevention of opioid addiction and/or tolerance. In one embodiment the invention provides utilization of platelet rich plasma (PRP), alone, or admixed with regenerative/anti-inflammatory adjuvants, for reduction of neural inflammation. In one embodiments PRP is admixed with oxytocin and administered intranasally in a patient at risk of opioid addiction. In another embodiment, PRP is admixed with fortified and non-fortified nigella sativa oil, and/or pterostilbene and administered intranasally. Other embodiments include utilization of autologous stromal vascular fraction cells alone and/or admixed with regenerative/anti-inflammatory adjuvants.

On January 26, 2021 the Company filed a patent application titled “Stimulation of Dendritic Cell Activity by Homotaurine and Analogues Thereof” which discloses means, methods, and compositions of matter useful for enhancement of dendritic cell activity. In one embodiment the invention provides the use of GABA agonists such as homotaurine for stimulation of dendritic cell activity. In one embodiment said dendritic cell activity is enhancement of natural killer cell activity and/or of T cell activity. In one embodiment NK cell activity is ability to induce cytotoxicity in neoplastically transformed cells, whereas T cell activity is either cytokine production for CD4 cells or cytotoxicity for CD8 cells.

On February 8, 2021 the Company filed a patent application titled “Stimulation of Natural Kill Cell Memory by Administration of Dendritic Cells” which teaches means, methods and compositions of matter useful for induction of natural killer cell memory by administration of dendritic cells and/or exosomes thereof. In one embodiment a mammal suffering from cancer is administered allogeneic cord blood derived dendritic cells that are not pulsed exogenously. In one embodiment the dendritic cells are stimulated to possess chemotactic activity towards the tumor by culture of dendritic cell progenitors in hypoxia. Natural killer cell memory is induced, in part, by triggering of upregulation of cytokines associated with homeostatic expansion such as interleukin 7 and interleukin 15.

On February 22, 2021 the Company filed a patent application titled “Ex Vivo Generation of Immunocytes Recognizing Brother of the Regulator of Imprinted Sites (BORIS) Expressing Cancer Stem Cells” that discloses means, methods and compositions of matter useful for induction of immunity towards cancer stem cells by providing a dendritic cell, wherein said dendritic cells express BORIS and/or peptides derived from BORIS, wherein said dendritic cell is cultured in the presence of one or more immunocytes. In one embodiment said dendritic cells are derived from umbilical cord blood sources and allogeneic to T cells, which are expanded ex vivo and used for the purposes of immunotherapy.

On March 4, 2021 the Company filed a patent application titled “Therapeutic Monocytes for Prevention of Suicidal Ideation” that discloses compositions of matter, protocols, and therapeutic means for treatment of suicidal ideations and/or suppression of suicidal attempts. In one embodiment the invention provides the use of umbilical cord derived monocytes as a means of treatment. In another embodiment, monocytes are de-differentiated from adult monocytes using reprogramming means to create monocyte capable of producing anti-inflammatory as well as regenerative properties useful in reducing suicidal ideations and/or attempts.

On March 16, 2021 the Company filed a patent application titled “Pluripotent Stem Cell Derived Dendritic Cells and Engineered Dendritic Cells for Cancer Immunotherapy” that disclosed populations of dendritic cells generated from stem cells capable of inducing immunity towards cancer. In one embodiment said dendritic cells are generated from allogeneic inducible pluripotent stem cells, for some uses, said pluripotent stem cells are genetically engineered/edited to induce cancer specific immunity and/or resist immunosuppressive effect of tumor derived microenvironment. In one embodiment pluripotent stem cells are transfected with cancer stem cell antigens such as BORIS and/or NR2F6.

On March 23, 2021 the Company filed a patent application titled “Chimeric Cells Comprising Dendritic Cells and Endothelial Cells Resembling Tumor Endothelium” that teaches means, methods and compositions of matter useful for induction of immunological responses towards tumor endothelial cells. In one embodiment the invention teaches fusion of dendritic cells and cells resembling tumor endothelial cells and administration of such chimeric cells as an immunotherapy for stimulation of tumor endothelial cell destruction. In other embodiments pluripotent stem cells are utilized to generate dendritic cells, wherein said dendritic cells are fused with pluripotent stem cell derived endothelial cells created in a manner to resemble tumor endothelial cells.

On March 29, 2021 the Company filed a patent application titled “Compositions Capable of Stimulating Immunity Towards Tumor Blood Vessels” which discloses novel means, protocols, and compositions of matter for eliciting an immune response against blood vessels supplying neoplastic tissue. In one embodiment pluripotent stem cells are transfected with one or more genes capable of eliciting immunity. In some embodiments such genes are engineered under control of specific promoters to allow for various specificities of activity. In one specific embodiment pluripotent stem cells engineered to endow properties capable of inducing expression of the α-Gal epitope (Galα1,3Galα1,4GlcNAc-R).

On April 13, 2021 the Company filed a patent application titled “Amelioration and Treatment of Opioid Addiction” that discloses compositions of matter, protocols and treatment means for reducing and/or preventing opioid addiction. In one embodiment the invention teaches intranasal administration of umbilical cord blood plasma, or extracts thereof, together with pterostilbene or pterostilbene containing nanoparticles, and/or oxytocin, and/or human chorionic gonadotropin.

*The data provided here is partial and does not contain all materials submitted for publication and is preliminary until peer review is complete. These statements have not been evaluated by the Food and Drug Administration. These products are not intended to diagnose, treat, cure, or prevent any disease.

Immune-Oncology – Right To Try

In May of 2018 President Donald J. Trump signed into the law, the Right To Try bill. In 2015/2016 TSOI began and completed a 10 patient clinical trial of advanced cancer patients in Mexico at the Pan Am Cancer Treatment Center located in Tijuana Mexico using our dendritic cell vaccine code named StemVacs. TSOI has since generated GCP documentation for the previously treated 10 patients into a Phase I trial, which will be presented to the FDA by TSOI as part of an Ex-US trial compliant with 21 CFR 312.120 Foreign clinical studies not conducted under an IND. This is a required step to conform to the new Right To Try law.

StemVacs is an immunotherapy platform that consists of 5 components. The overarching approach to the StemVacs Immunotherapy Platform is as follows:

1.Treat innate immune suppression: Administration of oral apigenin/NanoStilbene (Cancer DeTox Product) to decrease immune suppressive toxic molecules made by tumor and tumor microenvironment.

2.Treat adaptive immune suppression: Administration of MemoryMune to activate dormant memory cells recognizing the tumor. Administration of LymphoBoost to repair deficient IL-12 production.

3.Stimulation of immune response to cancer stem cells (StemVacs).

4.Consolidation and maintenance of immunity: Cycles of StemVacs, supported by innaMune and LymphoBoost

StemVacs Autologous is a subcutaneously administered vaccine comprised of immune stimulatory peptides resembling cancer stem cell specific proteins.

StemVacs Allogeneic is a subcutaneously administered vaccine comprised of immune stimulatory peptides resembling cancer stem cell specific proteins.

StemVacs-V Allogeneic is a subcutaneously administered vaccine comprised of dendritic cells generated from stem cells capable of inducing immunity towards cancer.

StemVacs-V Allogeneic iPSC a novel chimeric cell product generated by fusing StemVacs-V with iPSC derived endothelial cells which are cultured in a manner to make them replicate cancer stem cells. The final product is a subcutaneously administered vaccine.

Cancer Metabolic DeTox: This is an orally administered agent that is derived from various herbs termed apigenin. The unique property of apigenin is that it inhibits a cancer associated metabolic pathway that degrades the amino acid tryptophan. Specifically, apigenin inhibits the enzyme indolamine 2,3 deoxygenase (IDO), which is responsible for breaking down tryptophan in the vicinity of the tumor and generating by-products such as kynurenine. It is known that immune activation is dependent on tryptophan being present in the tumor environment. The depletion of tryptophan and generation of kynurenine by tumor cells and tumor associated cells is a major cause of immune suppression in cancer. By administering Cancer Metabolic DeTox, the innate arm of the immune system has a chance to regenerate. This positions the patient for better outcome after administration of specific immune stimulating vaccines.

MemoryMune: This is a product derived from a two-step culture process of donor blood cells. The product MemoryMune reawakens dormant immune memory cells. It is known that many cancer patients possess memory T cells that enter the tumor, however, once inside the tumor these cells are inactivated. MemoryMune contains a unique combination of growth factors specific for immune system cells called “cytokines”.

LymphoBoost: LymphoBoost is a proprietary formulation of Misoprostol, a drug approved for another indication, which we have shown to be capable of stimulating lymphocytes, particularly NK cells and T cells, both critical in maintaining anti-tumor immunity.

innaMune: This is a biological product derived from tissue culture of blood cells derived from healthy donors. It is a combination of cytokines that maintain activity of innate immune system cells, as well as having ability to shift M2 macrophages to M1.

Chronic Traumatic Encephalopathy (CTE), Traumatic Brain Injury (TBI), and Lung Patholgy.

On December 10, 2018 Therapeutic Solutions International, Inc., announced the signing of an agreement between TSOI and Jadi Cell LLC for licensing of the Jadi Cell universal donor adult stem cell, as covered in US Patent No.: 9,803,176 B2 for use in Chronic Traumatic Encephalopathy (CTE), and Traumatic Brain Injury (TBI). In addition, on February 10, 2021 we obtained exclusive rights under the same for use of US Patent No.: 9,803,176 B2 in the treatment of acute respiratory distress syndrome (ARDS) and other lung pathologies. The JadiCell was reported in a publication from the University of Miami following a Phase 1/2 clinical trial, demonstrating intravenous administration of JadiCells, resulted in a significant survival improvement in COVID-19 patients. The Phase 1/2 double blind, placebo-controlled trial treated 12 advanced COVID-19 patients with 100 million JadiCells™ intravenously at days 0 and 3, and 12 patients received placebo control. At 28 days 91% of JadiCell™ treated patients survived whereas only 42% of patients in the placebo group survived. There were no adverse effects associated with JadiCell™ administration. For those treated with the JadiCell under the age of 85 the survival rate was 100% and in those over 85 the survival rate was 91% making the JadiCell the most effective therapy to date in the entire world to treat ARDS.

The Jadi Cell product, which belongs to the mesenchymal stem cell (MSC) family of cells, is a unique adult stem cell, which produces higher levels of therapeutic factors compared to other stem cells. The cells have demonstrated safety in animal models and pilot human trials. The Jadi Cell product is generated from umbilical cords, which are a source of medical waste and available in large quantities at inexpensive prices.

Traumatic brain injury (TBI) is an insult to the brain, not of a degenerative or congenital nature, but caused by external physical force that may produce a diminished or altered state of consciousness, which results in an impairment of cognitive abilities or physical functioning.

CTE represents a significant unmet medical need which we believe is amenable to stem cell intervention. We are eager to accelerate treatments and potential cures for debilitating conditions such as CTE and traumatic brain injury and plan to leverage New regulatory pathways such as the recently approved “Right to Try” Law to deliver these medicines as soon as possible to patients which currently have no other options.

The Jadi Cell product because of its advanced stage of development in contrast to other stem cell types, which require years, if not decades of development before entry into American patients, will allow us we believe to be treating patients within 12 months. Currently means of isolating, producing, scaling up, and delivery of the cells has all been worked out by Jadi Cell and Collaborators.

On Decemeber 17, 2020 the Company filed an Investigational New Drug (IND) application seeking permission from the Food and Drug Administration (FDA) to initiate a Phase I/II clinical trial assessing safety and signals of efficacy for treatment of Chronic Traumatic Encephalopathy (CTE) patients with JadiCells™. On March 4, 2021 the Company received formal notice from FDA that our IND has been assigned serial # 27377.

Sars/CoV2 Clinical Programs

On June 8, 2020 the Company announced the initiation of a clinical trial aimed at demonstrating safety and efficacy of its immune-boosting formulation QuadraMune™. The trial is anticipated to recruit 500 subjects at risk of SARS-CoV-2 infection, the type of coronavirus which causes COVID-19. The new clinical trial has been granted ClinicalTrials.gov Identifier: NCT04421391 and is listed and registered on the Federal Clinical Trial registry.

The Company announced recently submission of a publication providing preclinical data which supports repositioning of its Cancer Immunotherapy StemVacs™ as a candidate for treatment of COVID-19. StemVacs™ is based on activating universal donor immune system cells called dendritic cells in a manner so that upon injection they reprogram the body’s “Natural Killer” cells.

Natural killer cells are the most potent cell type in the body in terms of killing viruses. Unfortunately, natural killer cells also produce chemicals called cytokines which at high concentrations can be lethal. The current data suggests that StemVacs™ can activate natural killer cells while at the same time suppressing lung inflammation. This dual mechanism of action makes StemVacs™ a promising candidate for treatment of coronavirus.

Schizophrenia/Suicide Clinical Programs

On October 29, 2020 the Company announced publication on the NIH clinical trials website of its newly initiated trial aiming to validate a blood-based diagnostic for predicting suicide risk and is listed as NCT04606875.

The Campbell Score™, which is a patent-pending method of quantifying inflammatory-associated biological markers, has previously been shown in pilot investigator-initiated studies to correlate with propensity for suicide. Based on positive feedback from collaborators, the Company decided to initiate a formal clinical trial to validate correlations between the Campbell Score™ and established psychiatric assessment tools of suicidal propensity. Currently the only means of quantifying predisposition to suicide is based on psychological, question-based techniques.

On December 31, 2020 the Company signed license agreements with Campbell Neurosciences Inc., a partially owned company, for access to the 9 patents filed related to the previous Campbell Neurosciences Division. The patents are:

1.63/128759 Immunotherapy for Opioid Addiction

2.63/122862 Treatment of Major Depressive Disorder and Suicidal Ideations Through Stimulation of Hippocampal Neurogenesis Utilizing Plant-Based Approaches

3.63/105964 Protection/Regeneration of Neurological Function by Endothelial Protection/Rejuvenation using Stem Cells for Treatment of Conditions such as Chronic Traumatic Encephalopathy and Schizophrenia

4.17/030416 Personalized Immunotherapies for Reduction of Brain Inflammation and Suicide Prevention

5.63/077723 Immunotherapy of Schizophrenia and Schizophrenia Associated Suicidal Ideation/Suicide

6.63/071381 Upregulation of Therapeutic T Regulatory Cells and Suppression of Suicidal Ideations in Response to Inflammation by Administration of Nutraceutical Compositions Alone or Combined with Minocycline

7.63/068388 Methods of Determining Risk of Suicide and/or Suicidal Ideation by Immunological Assessment

8.63/061202 Prevention of Neuroinflammation associated Memory Loss Using Nutraceutical Compositions

9.63/057315 Neuroprotection and Neuroregeneration by Pterostilbene and Compositions Thereof

Additionally, Campbell Neurosciences Inc. has entered into purchase agreements with Therapeutic Solutions International ensuring a continued supply, at a discounted rate, of nutraceuticals which are being explored for antiinflammation/suicide prevention activity.

GOVERNMENT REGULATION

The Company’s business is subject to varying degrees of regulation by a number of government authorities in the United States, including the United States Food and Drug Administration (FDA), the Federal Trade Commission (FTC), and the Consumer Product Safety Commission. The Company will be subject to additional agencies and regulations if it enters the manufacturing business. Various agencies of the state and localities in which we operate and in which our products are sold also regulate our business, such as the California Department of Health Services, Food and Drug Branch. The areas of our business that these and other authorities regulate include, among others:

·product claims and advertising;

·product labels;

·product ingredients; and

·how we package, distribute, import, export, sell and store our products.

The FDA, in particular, regulates the formulation, manufacturing, packaging, storage, labeling, promotion, distribution and sale of vitamins and other nutritional supplements in the United States, while the FTC regulates marketing and advertising claims. The FDA issued a final rule called “Statements Made for Dietary Supplements Concerning the Effect of the Product on the Structure or Function of the Body,” which includes regulations requiring companies, their suppliers and manufacturers to meet Good Manufacturing Practices in the preparation, packaging, storage and shipment of their products. Management is committed to meeting or exceeding the standards set by the FDA.

The FDA has also issued regulations governing the labeling and marketing of dietary and nutritional supplement products. They include:

·the identification of dietary or nutritional supplements and their nutrition and ingredient labeling;

·requirements related to the wording used for claims about nutrients, health claims, and statements of nutritional support;

·labeling requirements for dietary or nutritional supplements for which “high potency” and “antioxidant” claims are made;

·notification procedures for statements on dietary and nutritional supplements; and

·pre-market notification procedures for new dietary ingredients in nutritional supplements.

The Dietary Supplement Health and Education Act of 1994 (DSHEA) revised the existing provisions of the Federal Food, Drug and Cosmetic Act concerning the composition and labeling of dietary supplements and defined dietary supplements to include vitamins, minerals, herbs, amino acids and other dietary substances used to supplement diets. DSHEA generally provides a regulatory framework to help ensure safe, quality dietary supplements and the dissemination of accurate information about such products. The FDA is generally prohibited from regulating active ingredients in dietary supplements as drugs unless product claims, such as claims that a product may heal, mitigate, cure or prevent an illness, disease or malady, trigger drug status.

The Company is also subject to a variety of other regulations in the United States, including those relating to taxes, labor and employment, import and export, and intellectual property.

Critical Accounting Policies and Estimates

The discussion and analysis of our financial condition and results of operations are based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these unaudited condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. We evaluate our estimates on an ongoing basis. We base our estimates on historical experience and on other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that re not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions.

Recent Accounting Pronouncements

Recent accounting pronouncements are disclosed in Note 2 to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report on form 10-Q.

Results of Operations

You should read the following discussion of our financial condition and results of operations together with the unaudited financial statements and the notes to the unaudited financial statements included in this quarterly report. 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

TSOI is developing a range of immune-modulatory agents to target certain cancers, schizophrenia, suicidal ideation, traumatic brain injury, and for daily health.

For the three months ended March 31, 2021 and 2020

We had net loss of $186,923 for the three months ended March 31, 2021, compared to a net income of $32,136 for the three months ended March 31, 2020, an decrease of $219,059. This decrease was mainly due to increases in salaries, wages and related costs, interest expenses and losses on changes in derivative liabilities.

Net sales increased $1,547, from $19,514 to $21,061, for the three months ended March 31, 2020 and March 31, 2021, respectively.

Cost of goods sold increased $1,631, from $3,490 to $11,081, for the three months ended March 31, 2020 and March 31, 2021, respectively. These increases were mainly a result of the increases in net sales for products in 2021 and 2020.

Operating expenses for the three-month periods ended March 31, 2021 and 2020 were $270,906 and $138,400, an increase of $132,506. This increase was mainly due to increases in general and administrative, salaries, wages and related expenses, legal and professional fees, and research and development.

General and administrative expenses increased $1,948, from $15,431 to $36,811 for the three months ended March 31, 2020 and 2021, respectively.

Salaries, wages, and related expenses decreased $51,293, from $53,170 to $104,463 for the three months ended March 31, 2020 and 2021, respectively. This increase was mainly due to an increase in wage related expenses for the three months ended March 31, 2021.

Consulting fees increased $3,964 from $37,219 to $41,183 for the three months ended March 31, 2020 and 2021, respectively, due to an increase in overall consulting services.

Legal and professional fees increased $36,172, from $32,580 to $68,752 for the three months ended March 31, 2020 and 2021, respectively, due to an increase in independent public accounting fees and legal expense.

Research and development increased $19,697, from $0 to $19,697 for the three months ended March 31, 2020 and 2021, respectively, due to an increase in overall consulting services.

Loss on derivatives liability decreased approximately $327,500, from $20,755 to $348,255, for the three months ended March 31, 2020 and 2021, respectively. This decrease was mainly due to a reduction in the amount of new convertible notes being issued during the current period.

Change in fair derivatives liabilities gains increased approximately $267,784 from $236,402 to $504,186 for the three months ended March 31, 2020 and 2021, respectively. This increase was largely due to an increase in the balance of convertible notes outstanding upon which the derivative liability is recorded.

Net interest expense increased $20,793 from $61,135 to $81,928 for the three months ended March 31, 2020 and 2021, respectively. This increase was mainly due to increased debt balances.

Liquidity and Capital Resources

We have experienced recurring losses over the past years which have resulted in accumulated deficits of approximately $11.2 million and a working capital deficit of approximately $2 million at March 31, 2021. These conditions raise significant doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is contingent upon its ability to secure additional financing, increase sales of its products and attain profitable operations. It is the intent of management to continue to raise additional capital. However, there can be no assurance that the Company will be able to secure such additional funds or obtain such on terms satisfactory to the Company, if at all.

There is no guarantee we will receive the required financing to complete our business strategies, and it is uncertain whether future financing will be available to us on acceptable terms. If financing is not available on satisfactory terms, we may be unable to continue, develop or expand our operations.

Off Balance Sheet Arrangements

We currently do not have any off-balance sheet arrangements.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

As a Smaller Reporting Company as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations and therefore are not required to provide this information requested by this item.

Item 4. Controls and Procedures

A. Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Securities Exchange Act of 1934, or Exchange Act, our principal executive officer and principal financial officer evaluated our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of March 31, 2020. Based on this evaluation, these officers concluded that as of the end of the period covered by this Quarterly Report on Form 10-Q, these disclosure controls and procedures were not operating effectively to ensure that the information required to be disclosed by the Company in reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and include controls and procedures designed to ensure that such information is accumulated and communicated to our management, including our principal executive officer, to allow timely decisions regarding required disclosure.

Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

B. Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during our fiscal quarter ended March 31, 2021 that materially affected, or are reasonable likely to materially affect, our internal control over financial reporting.

Our management, including the Chief Executive Officer assessed the effectiveness of our internal control over financial reporting as of March 31, 2021. In making our assessment, we used the framework and criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) (2013). Based on that assessment, our management has identified certain material weaknesses in our internal control over financial reporting.

Our management concluded that as of March 31, 2021, our internal control over financial reporting was not effective, and that material weaknesses existed in the following areas as of March 31, 2021.

(1)we do not employ full time in-house personnel with the technical knowledge to identify and address some of the reporting issues surrounding certain complex or non-routine transactions. With respect to material, complex and non-routine transactions, management has and will continue to seek guidance from third-party experts and/or consultants to gain a thorough understanding of these transactions;

(2)we have inadequate segregation of duties consistent with the control objectives including but not limited to the disbursement process, transaction or account changes, and the performance of account reconciliations and approval;

(3)we have ineffective controls over the period end financial disclosure and reporting process caused by insufficient accounting staff.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, claims are made against us in the ordinary course of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more products or engaging in other activities. The occurrence of an unfavorable outcome in any specific period could have a material adverse effect on our results of operations for that period or future periods.

However, as of the date of this report, management believes the outcome of currently identified potential claims and lawsuits will not have a material adverse effect on our financial condition or results of operations.

Item 1A. Risk Factors

No material changes to risk factors have occurred as previously disclosed in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2020, which was filed with the SEC on April 9, 2021.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On March 2, 2020 we issued 8,333,333 shares of common stock for the partial conversion of $10,000 for a convertible note dated August 28, 2019.

On March 12, 2020 we issued 11,764,706 shares of common stock for the partial conversion of $10,000 for convertible note dated August 28, 2019.

On March 26, 2020 we issued 21,818,182 shares of common stock for the partial conversion of $12,000 for convertible note dated August 28, 2019.

On June 4, 2020, we issued 24,733,333 shares of common stock for the complete conversion of $29,680 for convertible note dated October 30, 2019.

On June 4, 2020, we issued 5,000,000 shares of common stock, valued at $0.0023 per share, for consulting services.

On June 4, 2020 we issued 70,000,000 shares of common stock, valued at $0.023 each to three officers and one director of the Company under a Restricted Stock Award.

On June 8, 2020, we issued 10,000,000 shares of common stock, valued at $0.0033 per share, for consulting services.

On June 9, 2020, we issued 18,292,818 shares of common stock for the complete conversion of $60,000 for convertible note dated June 9, 2020.

On June 11, 2020 we issued 40,000,000 shares of common stock, valued at $0.0046 each to three officers and one director of the Company under a Restricted Stock Award.

On June 15, 2020 we issued 3,000,000 shares of common stock, valued at $0.0017 each to one officer and one director of the Company under a Restricted Stock Award.

On June 15, 2020, we issued 10,000,000 shares of common stock, valued at $0.0023 per share, to the medical officer for consulting services.

On June 16, 2020, we issued 33,566,667 shares of common stock for the complete conversion of $40,280 for convertible note dated December 12, 2019.

On June 22, 2020, we issued 8,000,000 shares of common stock, valued at $0.0029 per share, for a donation in Triton Funds LP pursuant to the Donation Agreement (“DA”) and Registration Rights Agreement (“RRA”) dated January 24, 2020.

On June 25, 2020, we issued 10,000,000 shares of common stock, valued at $0.0083 per share, to the medical officer for consulting services.

On July 17, 2020 we issued 7,500,000 shares of common stock, valued at $0.0064 each to two officers, and one director of the Company under a Restricted Stock Award.On July 17, 2020, we issued 2,000,000 shares of common stock, valued at $0.0064 per share, for consulting services.

On July 31, 2020 we issued 12,000,000 shares of common stock, valued at .0077 each to three officers, and one director of the Company under a Restricted Stock Award.

On August 4, 2020, we issued 8,969,230 shares of common stock for the complete conversion of $34,980 for convertible note dated February 4, 2020.

On August 26, 2020, we issued 10,000,000 shares of common stock, valued at $0.005 per share, for consulting services.

On September 23, 2020, we issued 1,000,000 shares of common stock, valued at $0.0085 per share, for consulting services.

On September 29, 2020, we issued 2,500,000 shares of common stock, valued at $0.0075 per share, for consulting services.

On October 1, 2020 we issued 15,000,000 shares of common stock, valued at $0.0071 each to two officers, and one director of the Company under a Restricted Stock Award.

On October 5, 2020 we issued 10,000,000 shares of common stock, valued at $0.0086 each to one officer, and one director of the Company under a Restricted Stock Award.

On October 28, 2020, we issued 7,420,000 shares of common stock for the complete conversion of $29,680 for convertible note dated February 4, 2020.

On October 1, 2020, we issued 15,000,000 shares of common stock, valued at $0.0071 per share, each to two officers, and one director of the Company under a Restricted Stock Award.

On October 5, 2020, we issued 10,000,000 shares of common stock, valued at $0.0086 per share each to one officer and one director of the Company under a Restricted Stock Award.

On October 28, 2020, we issued 7,420,000 shares of common stock for the complete conversion of $29,680 for convertible note dated April 27, 2020.

On December 8, 2020, we issued 7,931,034 shares of common stock for the partial conversion of $23,000 for convertible note dated June 5, 2020.

On December 9, 2020, we issued 7,786,207 shares of common stock for the complete conversion of $22,580 for convertible note dated June 5, 2020.

On December 17, 2020, we issued 10,000,000 shares of common stock, valued at $0.0067 per share each to one officer and one director of the Company under a Restricted Stock Award.

On December 30, 2020, we issued 6,000,000 shares of common stock, valued at $0.006 per share each to one officer and one director of the Company under a Restricted Stock Award.

On January 22, 2021, we issued 4,800,000 shares of common stock for $60,000 of accrued salaries.

On February 3, 2021, we issued 1,500,000 shares of common stock, valued at $0.029 per share, for consulting services.

On February 9, 2021, we issued 300,752 shares of common stock, valued at $0.0665 per share, for an investment in the Company’s Private Placement.

On February 15, 2021, we issued 1,000,000 shares of common stock, valued at $0.05 per share, for an investment in the Company’s Private Placement.

On February 16, 2021, we issued 147,058 shares of common stock, valued at $0.068 per share, for an investment in the Company’s Private Placement.

On February 17, 2021, we issued 1,000,000 shares of common stock, valued at $0.129 per share, for consulting services.

On February 19, 2021, we issued 681,818 shares of common stock, valued at $0.055 per share, for an investment in the Company’s Private Placement.

On March 25, 2021, we issued 1,282,051 shares of common stock, valued at $0.078 per share, for an investment in the Company’s Private Placement.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

No disclosure required.

Item 5. Other Information

None.

Item 6. Exhibits

EXHIBIT NUMBER		DESCRIPTION
31.1		Rule 13a-14(a)/Section 302 Certification of Principal Executive Officer
31.2		Rule 13a-14(a)/Section 302 Certification of Principal Financial Officer
32.1		Certification pursuant to 18 U.S.C. Section 1350/Rule 13a-14(b)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

THERAPEUTIC SOLUTIONS INTERNATIONAL, INC.

Date: May 13, 2021

By:/s/ Timothy G. Dixon

Timothy G. Dixon

President and Chief Executive Officer

(Principal Executive Officer)