Annovis Bio to restate certain prior financial statements

During the course of its year-end close process, Annovis Bio concluded that there were material amounts inappropriately classified as research and development expenses which should have been classified as prepaid assets and other assets in its previously issued unaudited condensed consolidated financial statements as of and for each of the quarterly and year to date periods ended March 31, 2022, June 30, 2022 and September 30, 2022. On February 28, 2023, the Audit Committee of the Board of Directors and the Board of Directors, in consultation with management, concluded that it is appropriate to correct the errors in accounting in the company’s financial statements for each of its interim periods ended March 31, 2022, June 30, 2022 and September 30, 2022 included in the associated Quarterly Reports on Forms 10-Q for each of the Non-Reliance Periods, filed with the SEC, by restating such unaudited financial information because the errors in the financial statements are material to the financial statements for each of the Non-Reliance Periods. The company will disclose in its Annual Report on Form 10-K for the year ended December 31, 2022 the restated financial statements for each of the Non-Reliance Periods. As a result, the unaudited financial statements for each of the Non-Reliance Periods should no longer be relied on. Similarly, any previously issued or filed reports, press releases, earnings releases, and investor presentations or other communications describing the company’s financial statements and other related financial information covering the Non-Reliance Periods should no longer be relied upon. The company is currently in the process of determining the exact amounts and full effect of the errors in the financial statements for each of the Non-Reliance Periods. The company does not currently expect the errors to change the cash position of the company as of the end of each Non-Reliance Period. The company is currently working to complete the filing of its Annual Report on Form 10-K for the year ended December 31, 2022 as soon as practicable, which will include the Restatements. Management is assessing the effect of these Restatements on the company’s internal control over financial reporting and its disclosure controls and procedures. The company expects to report at least one material weakness following completion of its analysis of the cause of these Restatements. A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. The existence of one or more material weaknesses precludes a conclusion by management that the company’s disclosure controls and procedures and internal control over financial reporting are effective. As a result of the material weakness or material weaknesses, the company believes that its internal control over financial reporting was not effective, and its disclosure controls and procedures were not effective for the Non-Reliance Periods.