Company: OCEA
Filing Date: 2025-01-13
Form Type: 10-Q
Source: 0001493152-25-001880
Chunk: 80

Company: Ocean Biomedical, Inc.
Filing Date: 2025-01-13
Form: 10-Q
Item: Item 1
Chunk 80
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 potential
    changing government regulations.

Any
changes in the outcome of any of these variables with respect to the development of our product candidates in preclinical and clinical
development could mean a significant change in the costs and timing associated with the development of these product candidates, such
as if the FDA or another regulatory authority were to delay our planned start of clinical trials or require us to conduct other clinical
trials or testing beyond those that we currently expect or if significant delays in enrollment in any of our planned clinical trials
occurred. Such delays or changes may require us to expend significant additional financial resources and time on the completion of clinical
development of that product candidate.

General
and Administrative Expenses

General
and administrative expenses consist, or will consist, primarily of salaries and benefits, travel and stock-based compensation expense
for personnel in executive, business development, finance, legal, human resources, information technology, pre-commercial and support
personnel functions. General and administrative expenses also include direct and allocated facility-related costs, insurance costs, stock-based
compensation, and professional fees for internal and external accounting services, legal, patent, consulting, investor and public relations.

We
anticipate that our general and administrative expenses will increase in the future as we increase our headcount to support our continued
research activities and development of our product candidates and prepare for potential commercialization activities. We also incur significantly
increased accounting, audit, legal, regulatory, tax, compliance with Nasdaq and SEC requirements, and director and officer insurance
costs as well as investor and public relations expenses associated with operating as a public company. If and when we believe a regulatory
approval of a product candidate appears likely, we anticipate an increase in payroll and other employee-related expenses as a result
of our preparation for commercial operations as it relates to the sales and marketing of that product candidate.

40

Income
Taxes

Income
taxes are recorded in accordance with FASB ASC 740, Income Taxes, which provides for deferred taxes using an asset and liability
approach. We recognize deferred tax assets and liabilities for the expected future tax consequences of events that have been included
in the financial statements or tax returns. Deferred tax assets and liabilities are determined based on the difference between the financial
statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected
to reverse, and net operating loss, or NOL, carryforwards and research and development tax credit carryforwards. Valuation allowances