Company: BDRX
Filing Date: 2025-01-17
Form Type: F-1
Source: 0001214659-25-000922
Chunk: 127

Company: Biodexa Pharmaceuticals Plc
Filing Date: 2025-01-17
Form: F-1
Chunk 127
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31, 2023.

Operating Expenses

We
classify our operating expenses into two categories: (i) research and development, and (ii) administrative costs. These categories correspond
to different functional areas within the Company.

Our
operating expenses primarily consist of personnel costs, contract research and development costs, professional service fees and depreciation.
Personnel costs for each category of operating expenses include salaries, bonuses, social security, health insurance, other employee benefits
and share-based compensation for personnel in that category. We allocate share-based compensation expense resulting from the amortization
of the fair value of options. Central overheads, such as rent, computer and other technology costs, are not allocated out to departments.

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Research and Development Cost. Research and development costs consist of costs that are directly attributable to our research and development
programs associated with the products described herein. This includes costs of third party contract research organizations, research specialist
professional services providers, chemicals and other consumables used in the research and manufacturing process, depreciation of assets
related to the research and development function, and payroll costs of staff directly assigned to the research and manufacturing operations.

Administrative Costs. These primarily consist of personnel costs for our executive, finance, corporate development and administrative personnel,
as well as legal, accounting and other professional service fees, other corporate expenses, merger and acquisition costs and initial public
offering costs that are charged to the consolidated statement of comprehensive income. Administrative costs also include depreciation
of administrative assets.

Finance Income

Finance
income includes all interest receivable on cash deposits.

During
the first six months of 2024 and for the fiscal year ended December 31, 2023, finance income also included a gain on an equity settled
derivative financial liability. We issued warrants in fiscal 2023, 2020 and 2019 in connection with registered direct offerings. In 2015,
we assumed fully vested warrants and share options on the acquisition of DARA Biosciences, Inc. The number of Ordinary Shares to be issued
when the warrants and options are exercised is fixed, however the exercise prices are denominated in United States dollars, which is different
from the functional currency of the Company. Therefore, the warrants and share options are classified as equity settled derivative financial
liabilities in the consolidated statement of financial position with any gains or losses being recognized through finance income or finance
expense in the consolidated statement of comprehensive income.

Finance Expense

Finance
expenses include all interest payable on borrowings and loan instruments. In