XML 34 R17.htm IDEA: XBRL DOCUMENT v3.25.4
Commitments and Contingencies
 12 Months Ended
Sep. 30, 2025
Commitments and Contingencies [Abstract]  
COMMITMENTS AND CONTINGENCIES

9. COMMITMENTS AND CONTINGENCIES

 

Operating Lease

 

Effective July 1, 2019, we entered into a 76-month lease for office space in Cranford, NJ. On February 28, 2025 we extended the lease to February 28, 2030. A right-of-use asset of $786,697 was recognized as a non-cash asset and liability on the amendment date. We pay our proportionate share of real estate taxes and operating expenses in excess of the base year expenses. These costs are variable lease payments and are not included in the determination of the lease’s right-of-use asset or lease liability.

 

We identified and assessed the following significant assumptions in recognizing our right-of-use assets and corresponding lease liabilities:

 

  ● As the Cranford lease does not provide an implicit rate, we estimated the incremental borrowing rate in calculating the present value of the lease payments. We estimated the incremental borrowing rate based on the remaining lease term as of the amendment date.

 

  ● Since we elected to account for each lease component and its associated non-lease components as a single combined component, all contract consideration was allocated to the combined lease component.
     
  ● The expected lease terms include noncancelable lease periods.

 

The elements of lease expense are as follows:  

 

Lease cost    Year Ended
September 30,
2025		     Year Ended
September 30,
2024		  
Operating lease cost   $ 269,143     $ 238,823  
Variable lease cost     32,692       25,809  
Total lease cost   $ 301,835     $ 264,632  
                 
Other information                
Weighted-average remaining lease term - operating leases     4.42  Years       1.1 Years  
Weighted-average discount rate - operating leases     8.0 %     8.0 %

 

Maturities of lease liabilities due under the Company’s non-cancellable leases are as follows:

 

Year Ending September 30,    
2026  $171,280 
2027   232,827 
2028   237,686 
2029   242,545 
2030   102,849 
Total lease payments   987,187 
Less: interest   (173,914)
Present value of lease liabilities  $813,273 

 

Leases  Classification  September 30,
2025		   September 30,
2024		 
Assets           
Lease asset  Operating  $818,694   $246,247 
Total lease assets     $818,694   $246,247 
              
Liabilities             
Current  Operating  $88,348   $241,547 
Non-current  Operating   724,925    21,318 
Total lease liabilities     $813,273   $262,865 

 

Interest expense on the lease liability was $39,054 and $30,644 for the years ended September 30, 2025 and 2024, respectively. This amount is classified within general & administrative expense.

Commercial Manufacturing Contracts

 

We entered into an agreement with a Contract Manufacturing Organization for the manufacture and supply of drug substance. The agreement runs through calendar 2026, with an automatic renewal for a subsequent 4-year term. Under this agreement, we are obligated to purchase minimum annual quantities of batches at a set price per batch, subject to annual increases. Additionally, we are required to pay an annual service fee of $250,000. The agreement also includes provisions for potential price increases based on increases in the manufacturer’s operating expenses or industry indices, as well as significant termination fees and obligations. As of September 30, 2025, the total minimum purchase commitment under this agreement was approximately $16.2 million consisting of payments of $8.5 million and $5.3 million for 2025 and 2026 respectively and approximately $2.4 million for 2026 pass-throughs and consumable manufacturing components.

 

As of September 30, 2025, we also have commercial supply agreements with two other vendors for the completion and packaging of finished drug products. Minimum purchase commitments under these two agreements amount to approximately $4.9 million consisting of purchase commitment obligations of $1.2 million in 2025 and $1.9 million in 2026 and $1.8 million in 2027.

 

Legal Proceedings

 

We are not involved in any litigation that we believe could have a material adverse effect on our financial position or results of operations. There is no action, suit, proceeding, inquiry, or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of our executive officers, threatened against or affecting us or our officers or directors in their capacities as such.