Results of Operations

At the end of January 2022 we acquired from Predictive Biotech, Inc. all of the assets related to its business of developing and producing wound care treatments, including AmnioBind, which is a placental membrane allograft designed to act as a covering or barrier for the protection of burns and non-healing wounds such as diabetic foot ulcers. Since acquiring those assets in our newly organized subsidiary, Healthtech Wound Care, Inc. ("HWC"), we have focused our immediate attention on achieving the regulatory approvals necessary for HWC to bring AmnioBind to market. $975,246 (i.e. 96%) of the $1,014,649 that we devoted to research and development during the first six months of 2022 was attributable to efforts of HWC to complete and test a market-ready version of AmnioBind.

The other significant contributor to our loss from operations in the first half of 2022 was general and administrative expenses of $730,741 (including $90,000 payable to related parties). These expenses primarily involve insurance premiums, office expenses, legal and accounting expenses, compensation of consultants, and other expenses incurred in developing Healthtech Solutions into a viable incubator of development stage medical companies. In total, our operating expenses for the first six months of 2022 were $1,781,144, which amounted to our loss from operations as we had no revenue. By comparison, our loss from operations during the first six months of 2021 was $1,768,078, the greater portion of which was related to the market value of common stock that we granted to attract management, research and development expertise and other individuals qualified to aid our projects. Of the $1,768,078 in operating expenses incurred during the six months ended June 30, 2021, stock compensation represented $1,029,028 of the expense.

We expect that our research and development expenses will rise significantly if we obtain the capital resources necessary to fully implement our business plan. In particular, the effort to bring MediScan's and RevHeart's technology to market will require several million dollars of capital investment.

In the fall of 2020, prior to the reverse merger of Healthtech Solutions into MediScan, MediScan sold 7% Convertible Debentures to obtain capital. In connection with the reverse merger, the MediScan debentures were exchanged for 7% Convertible Debentures issued by Healthtech Solutions. Healthtech Solutions then sold additional Debentures, with the result that by during the first six months of 2021 the greater portion of our net loss reflected "other expenses" related to the convertible debentures. During the three months ended June 30,2021, we incurred items of Other Expenses that added $3,269,494 to our net loss, specifically:

· $328,544 in interest expense due to accretion of the debenture discount; and

· A loss of $2,940,950 due to an increase in the fair value of derivative

liabilities, related to the 7% Convertible Debentures.

We accounted for our convertible debt in accordance with ASC 815, Derivatives and Hedging as the conversion feature embedded in the convertible debentures could have resulted in the debenture principal and related accrued interest being converted to a variable number of our common shares. The conversion feature on these debentures was variable and based on trailing market prices. It therefore contained an embedded derivative. The fair value of the conversion feature was calculated when the debentures were issued, and we recorded a debenture discount and derivative liability for the calculated value. We recognized interest expense for accretion of the debenture discount over the term of the note. The conversion liability was valued at the end of the reporting period and resulted in income for the reduction in fair value. Among the reasons why we negotiated a cancellation of the Debentures in exchange for common stock was that the volatile price of our stock meant that the gain or loss realized due to the Debentures could often be material to our results.





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After taking these Other Expenses into account, Healthtech Solutions realized a net loss of $979,799 ($0.01 per share) in the three months ended June 30, 2022 and a net loss of $4,775,080 ($.23 per share) during the three months ended June 30, 2021. However, 30% of HWC and 38.74% of Medi-Scan are owned by minority investors. Therefore, $317,988 of the net loss contributed by HWC and $44,708 of the net loss contributed by Medi-Scan in the first six months of 2022 are attributable to those minority interests. These are recorded on our Statement of Operations as "net loss attributable to non-controlling interest." The remainder, the "net loss attributable to controlling interest", was $764,883 for the three months ended June 30, 2022 and $4,773,870 for the three months ended June 30, 2021. For the same reason, $362,696 of the net loss realized during the six months ended June 30, 2022 was attributed to the minority interests, leaving a net loss of $1,418,448 attributable to the controlling interest. For the six months ended June 30, 2021, the net loss attributable to controlling interest was $5,067,747.

Liquidity and Capital Resources

Our company is designed to function as an incubator for development stage medical technology enterprises. During 2021 and 2020 our statements of cash flows reflected that design: in each year we raised capital from the sale of securities and used approximately the amount of cash raised to fund medical research. Our administrative expenses, albeit representing a large portion of our loss in each year, were primarily paid for by issuance of common stock.

During the six months of 2022 we modified the funding process. For the funds needed to sustain our operations in the first six months of 2022, particularly the funds required by HWC to complete development of AmnioBind, we relied on loans from shareholders and from non-affiliated parties. During those six months, we borrowed $774,362 from shareholders and $791,000 from non-affiliated parties. From that sum, we advanced $349,432 to Predictive Biotech, Inc. and its parent as a prepayment of future commissions pursuant to the terms under which we purchased their wound care business. (We also reclassified to prepaid commissions a loan of $168,000 that we made to Predictive Biotech, Inc. in December 2021.) That left net loan proceeds of $1,047,930, from which we funded the remaining $1,120,687 in net cash that we used in our operating activities during the first six months of 2022.

In the first six months of 2021, our sources and uses of funds differed somewhat from the first six months of 2022. We entered 2021 with $128,996 in the bank (proceeds from the sale of convertible debentures). We added to that $1,792,500 proceeds from the sale of our common stock and $50,000 in debenture proceeds. That combination enabled us to fund the $699,217 that we used in operating activities and the $437,055 that we contributed to the operations of Varian while it was our subsidiary.

At December 31, 2021 Healthtech Solutions had a working capital deficit of $757,563. During the first six months of 2022, we increased the working capital deficit by $2,002,861 to $2,760,384. The increase in the working capital deficit occurred primarily because we borrowed funds on a short-term basis and used the funds to pay our present expenses and prepay future expenses.

We anticipate realizing revenue from the wound care business of HWC beginning in the second half of 2022, which will alleviate some of the cash flow burden of that business. That revenue, occurring shortly after our acquisition of the wound care business, will likely be the exception to the norm for our portfolio companies. Our business plan contemplates that, to attract exciting additions to our portfolio, we will offer most the several million dollars of financing that is necessary to bring a medical technology to a stage where its sponsor can function independently. Since our ambition is to sustain a portfolio of such enterprises, our near term capital requirements (near term being the two to three years before we can anticipate initial returns on most of our investments) will be tens of millions of dollars.

Note 3 to our consolidated financial statements discloses that the financial condition of Healthtech Solutions raises substantial doubt as to the Company's ability to continue as a going concern. Management intends to pursue one or more offerings of securities in order to obtain the funds that will be necessary for successful implementation of our business plan. At present, however, no commitments for future funding have been received.

Application of Critical Accounting Policies

In preparing our financial statements we are required to formulate working policies regarding valuation of our assets and liabilities and to develop estimates of those values. In our preparation of the financial statements for the three month period ended June 30, 2022, there were two estimates made which was (a) subject to a high degree of uncertainty and (b) material to our results. These were:



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        ?  Our determination to record $60,000 as the fair value of the 5.5%
           interest in Varian Biopharmaceuticals, Inc. that we received in
           November 2021. This determination was based on the financial condition
           of Varian Biopharmaceuticals at that time and the absence of objective
           criteria for attributing fair value to its technology. The fair value
           of Varian Biopharmaceuticals is included in the item on our Balance
           Sheets titled "Investment in and advance to non-consolidated
           affiliate."


       ?   Our determination to record an allowance of $257,432 and reduce to
           $260,000 the book value of the $517,432 prepaid commission that we
           advanced to Predictive Technology Group, Inc. ("PTG") in connection
           with our purchase of the wound care business carried on by PTG's
           subsidiary, Predictive Biotech, Inc. (See: Note 6 to the Consolidated
           Financial Statements.) Our determination was based on the fact that the
           prepaid commissions will be earned by PTG only as a result of sales to
           three specific customers and the fact that at the time of the
           acquisition Predictive Biotech, Inc. did not have a marketable product.

Impact of Accounting Pronouncements

There were no recent accounting pronouncements that have or will have a material effect on the Corporation's financial position or results of operations.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition or results of operations.

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