Company: BFRG
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023496
Chunk: 52

Company: BullFrog AI Holdings, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 8
Chunk 52
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 is fee-for-service partnerships and collaborations
with biopharmaceutical companies and other organizations of all sizes that have challenges analyzing data throughout the drug development
process. The Company provides the customer with an analysis of large complex data sets using the Company’s proprietary AI/ML platform.
This platform is aimed at predicting targets of interest, patterns, relationships, anomalies, and molecular drivers of disease. The Company
believes that there will be additional on-going work requested from partners; therefore, the service model utilizes a master services
agreement with work or task orders issued for discrete analysis performed at the discovery, preclinical, or clinical stages of drug development.
The Company will receive fees related to such agreements in either cash, the equity of its partners, or other consideration and, in some
instances, the potential for rights to new intellectual property generated from the analysis. Once data analysis and the analysis report
are complete, the Company delivers the analysis set to the customer and recognizes revenue at that point in time.

    8

Investments

The
Company currently has a single investment in equity securities issued by a privately held entity. The Company entered into a strategic
collaboration agreement and received such equity securities as remuneration for services rendered. The Company has elected to account
for this investment using the measurement alternative as the investment does not have a readily determinable fair value. Pursuant to
this alternative, the investment will be carried at its estimated fair value calculated as its cost minus any impairment. The Company
will adjust the investment to fair value only when it identifies observable price changes in orderly transactions for identical or similar
investments of the same issuer. The Company will evaluate the investment at each reporting period to determine whether the investment
is impaired.

Financial
Instruments

The
carrying value of short-term instruments, including cash and cash equivalents, accounts payable and accrued expenses approximate fair
value due to the relatively short period to maturity for these instruments. The Company has elected to account for its single investment
using the measurement alternative and it is considered a financial instrument accounted for at fair value on a non-recurring basis. Fair
value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal
or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
Valuation techniques used to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. The
Company utilizes a three-level valuation