Company: SXTPW
Filing Date: 2025-03-27
Form Type: 10-K
Source: 0001013762-25-003343
Chunk: 636

Company: 60 DEGREES PHARMACEUTICALS, INC.
Filing Date: 2025-03-27
Form: 10-K
Item: Item 1C
Chunk 636
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 price, which reflects the amount
for which it is probable that a significant reversal of cumulative revenue recognized will not occur. At the end of each subsequent reporting
period, the Company re-evaluates the estimated variable consideration included in the transaction price and any related constraint, and
if necessary, adjusts its estimate of the overall transaction price. Any such adjustments are recorded on a cumulative catch-up basis
in the period of adjustment. Reserves are established for the estimates of variable consideration based on the amounts the Company expects
to be earned or to be claimed on the related sales.

The Company receives the majority of its revenues
from sales of its Arakoda™ product to resellers in the US and abroad. The Company records US commercial revenues as a receivable
when our American distributor transfers shipped product to their title model for 60P. Foreign sales to both Australia and Europe are
recognized as a receivable at the point product is shipped to distributor. The shipments to Australia and Europe are further subject
to profit sharing agreements for boxes sold to customers.

Research and Development Costs 

The Company accounts for research and development
costs in accordance with FASB ASC Subtopic No. 730-10, Research and Development (“ASC 730-10”). Under ASC 730-10,
research and development costs are expensed as incurred. Accordingly, internal research and development costs are expensed as incurred.
Prepayments for research and development services are deferred and amortized over the service period as the services are provided. Advance
payments for specific materials, equipment, or facilities determined to have no alternative future use are initially deferred and recognized
as research and development expense when the related goods are delivered. 

The Company recorded $4,986,526 in research and
development costs during the year ended December 31, 2024 ($691,770 for the year ended December 31, 2023). The Company has also issued
shares of common stock to nonemployees in exchange for research and development services. The Company recognizes prepaid research and
development costs on the grant date, as defined in FASB ASC Subtopic No. 718, Compensation – Stock Compensation. See Note
10 for further details.

Fair Value of Financial Instruments and the Fair Value Option
(“FVO”)

The inputs used to measure fair value are based
on a hierarchy that prioritizes observable and unobservable inputs used in valuation techniques. These levels, in order of highest to
lowest priority, are described below:

    Level
    1