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Item 1. Financial Statements

2022-05-10 compared with 2022-02-09 · 338 added, 332 removed, 150 unchanged (82% of the section changed)

FINANCIAL STATEMENTS

Anavex Life Sciences Corp.

Interim Condensed Consolidated Financial Statements

December 31, 2021

March 31, 2022

Anavex Life Sciences Corp.

Interim Condensed Consolidated

Balance Sheets

As at December 31,

2021 and September 30, 2021

Interim Condensed Consolidated Balance Sheets

As at March 31, 2022 and September 30, 2021

September 30,

1 unchanged sentence

Cash and cash equivalents

$ 151,146,355

$ 152,107,745

Incentive and tax receivables

Prepaid expenses and other current assets

$ 156,896,368

$ 161,616,490

Liabilities and stockholders' equity

13 unchanged sentences

Additional paid-in capital

Share proceeds receivable

Accumulated deficit

3 unchanged sentences

Total liabilities and stockholders' equity

$ 156,896,368

$ 161,616,490

See Accompanying Notes to Condensed Consolidated Interim Financial Statements

Anavex Life Sciences

Anavex Life Sciences Corp.

Interim Condensed Consolidated

Statements of Operations

and Comprehensive Loss

For the three months ended December 31,

2021 and 2020 (Unaudited)

Statements of Operations and Comprehensive Loss

For the three and six months ended March 31, 2022 and 2021

Three months ended March 31,

Six months ended March 31,

Operating expenses

2 unchanged sentences

Total operating expenses

( 11,723,390 )

( 9,396,175 )

Other income (expenses)

Research and development incentive income

Interest income (expense), net

Foreign exchange gain, net

Interest income, net

Foreign exchange gain (loss), net

Total other income, net

Net loss before provision for income taxes

( 10,852,387 )

( 7,795,784 )

Income tax expense, current

Net loss and comprehensive loss

$ ( 10,882,367 )

$ ( 7,855,065 )

Net Loss per share

3 unchanged sentences

See Accompanying Notes to Condensed Consolidated Interim Financial Statements

Anavex Life Sciences

Interim Condensed Consolidated

Statement of Changes in Stockholders’ Equity

For the three months ended December 31, 2021 and 2020

Balance, October 1, 2021

Anavex Life Sciences Corp.

Interim Condensed Consolidated Statement of Changes in Stockholders' Equity

For the three months ended March 31, 2022 and 2021

Additional Paid-in

Share proceeds

Balance, January 1, 2022

( 208,468,231

Shares issued pursuant to exercise of stock options

Shares issued under Sales Agreement, net of share issuance costs

Share based compensation

Shares issued under Sales Agreement

share issue costs

Stock based compensation

Balance, March 31, 2022

( 218,906,042

Balance, January 1, 2021

( 167,532,295

Balance, December 31, 2021

Shares issued under 2019 purchase agreement

Purchase shares

Commitment shares

Shares issued upon exercise of options

Shares issued under Sales Agreement

share issue costs

Stock based compensation

Balance, March 31, 2021

( 175,687,517

See Accompanying Notes to Condensed Consolidated Interim Financial Statements

Life Sciences Corp.

Condensed Consolidated Statement of Changes in Stockholders' Equity

the six months ended March 31, 2022 and 2021

Additional Paid-in

Share proceeds

Balance, October 1, 2021

( 197,585,864

Shares issued under Sales Agreement

share issue costs

Shares issued upon exercise of stock options

Stock based compensation

Balance, March 31, 2022

( 218,906,042

1 unchanged sentence

( 159,677,230

$ ( 159,677,230 )

Shares issued under 2019 Purchase Agreement

1 unchanged sentence

Commitment shares

Shares issued under Sales Agreement, net of share issuance costs

Share based compensation

( 7,855,065 )

Balance, December 31, 2020

$ 213,766,108

Shares issued upon exercise of options

Shares issued under Sales Agreement

share issue costs

Stock based compensation

Balance, March 31, 2021

( 175,687,517

See Accompanying Notes to Condensed

Consolidated Interim Financial Statements

Anavex Life Sciences

Interim Condensed Consolidated

Statements of Cash Flows

For the three months ended

December 31, 2021 and 2020

See Accompanying Notes to Condensed Consolidated Interim Financial Statements

Anavex Life Sciences Corp.

Interim Condensed Consolidated Statements of Cash Flows

For the six months ended March 31, 2022 and 2021

Cash flows used in operating activities

$ ( 10,882,367 )

$ ( 7,855,065 )

Adjustments to reconcile net loss to net cash used in operations:

Stock-based compensation

Changes in non-cash working capital balances related to operations:

Changes in working capital balances:

Incentive and tax receivables

( 1,728,467 )

Prepaid expenses and other current assets

1 unchanged sentence

Accrued liabilities

Deferred grant income

Net cash used in operating activities

( 3,500,955 )

( 7,871,378 )

Cash flows provided by financing activities

3 unchanged sentences

Net cash provided by financing activities

(Decrease) increase in cash and cash equivalents during

Increase in cash and cash equivalents during the period

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

$ 151,146,355

Supplemental Cash Flow Information

1 unchanged sentence

See Accompanying Notes to Condensed Consolidated Interim Financial Statements

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 1 Description of Business and Basis of Presentation

Description of

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 1 Description of Business and Basis

of Presentation

Anavex Life Sciences Corp.

or the “Company”) is a clinical stage biopharmaceutical company engaged in the development of differentiated therapeutics

by applying precision medicine to central nervous system (“CNS”) diseases with high unmet need.

Anavex analyzes genomic data

from clinical studies to identify biomarkers, which are used to select patients that will receive the therapeutic benefit for the treatment

of neurodegenerative and neurodevelopmental diseases.

The Company’s lead compound ANAVEX ® 2-73 is being developed

to treat Alzheimer’s disease, Parkinson’s disease and potentially other central nervous system diseases, including rare diseases,

such as Rett syndrome, a rare severe neurological monogenic disorder caused by mutations in the X-linked gene, methyl-CpG-binding protein

Basis of Presentation

These unaudited interim condensed consolidated

financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”)

and accounting principles generally accepted in the United States of America (“U.S.

GAAP”) for interim reporting.

certain information and note disclosures normally included in the annual financial statements in accordance with U.S.

GAAP have been condensed

or omitted pursuant to such rules and regulations.

In the opinion of management, the disclosures are adequate to make the information

presented not misleading.

These accompanying unaudited interim condensed

consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management

are necessary for fair presentation of the information contained herein.

The consolidated balance sheet as of September 30, 2021 was derived

from the audited annual financial statements but does not include all disclosures required by U.S.

The accompanying unaudited interim

condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes

thereto included in the Company’s annual report on Form 10-K for the year ended September 30, 2021 filed with the SEC on November

The Company follows the same accounting policies in the preparation of interim reports.

Operating results for the three months

ended December 31, 2021 are not necessarily indicative of the results that may be expected for the year ending September 30, 2022.

All of the Company’s potential drug

compounds are in the clinical development stage and the Company cannot be certain that its research and development efforts will be successful

or, if successful, that its potential drug compounds will ever be approved for sales to pharmaceutical companies or generate commercial

or the “Company”) is a clinical stage biopharmaceutical company engaged in the development

of differentiated therapeutics by applying precision medicine to central nervous system (“CNS”) diseases with high

Anavex analyzes genomic data from clinical studies to identify biomarkers, which are used to select patients that will

receive the therapeutic benefit for the treatment of neurodegenerative and neurodevelopmental diseases.

The Company’s

lead compound ANAVEX ® 2-73 is being developed to treat Alzheimer’s disease, Parkinson’s

disease and potentially other central nervous system diseases, including rare diseases, such as Rett syndrome, a rare severe neurological

monogenic disorder caused by mutations in the X-linked gene, methyl-CpG-binding protein 2 (“MECP2”) .

These unaudited interim condensed

consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission

(“SEC”) and accounting principles generally accepted in the United States of America (“U.S.

interim reporting.

Accordingly, certain information and note disclosures normally included in the annual

financial statements in accordance with U.S.

GAAP have been condensed or omitted pursuant to such rules and regulations.

opinion of management, the disclosures are adequate to make the information presented not misleading.

These accompanying unaudited interim

condensed consolidated financial statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion

of management are necessary for fair presentation of the information contained herein.

The consolidated balance sheet as of September

30, 2021 was derived from the audited annual financial statements but does not include all disclosures required by U.S.

accompanying unaudited interim condensed consolidated financial statements should be read in conjunction with the audited consolidated

financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended September

30, 2021 filed with the SEC on November 24, 2021.

The Company follows the same accounting policies in the preparation of interim

Operating results for the three

and six months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending September

All of the Company’s

potential drug compounds are in the clinical development stage and the Company cannot be certain that its research and development

efforts will be successful or, if successful, that its potential drug compounds will ever be approved for sales to pharmaceutical

companies or generate commercial revenues.

To date, we have not generated any revenues from our operations.

The Company expects the business to continue to experience

negative cash flows for the foreseeable future and cannot predict when, if ever, our business might become profitable.

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 1 Description of Business and Basis of

Presentation – (Continued)

Management believes that the current working

capital position will be sufficient to meet the Company’s working capital requirements beyond the next 12 months after the date

that these interim condensed consolidated financial statements are issued.

The process of drug development can be costly, and the timing

and outcomes of clinical trials is uncertain.

The assumptions upon which the Company has based its estimates are routinely evaluated

and may be subject to change.

The actual amount of the Company’s expenditures will vary depending upon a number of factors

including but not limited to the design, timing and duration of future clinical trials, the progress of the Company’s research and

development programs and the level of financial resources available.

The Company has the ability to adjust its operating plan spending

levels based on the timing of future clinical trials.

Other than our rights related to the Sales

Agreement (as defined below in Note 5), there can be no assurance that additional financing will be available to us when needed or, if

available, that it can be obtained on commercially reasonable terms.

If the Company is not able to obtain the additional financing on

a timely basis, if and when it is needed, it will be forced to delay or scale down some or all of its research and development activities.

The Company expects the

business to continue to experience negative cash flows from operations for the foreseeable future and cannot predict when, if ever,

our business might become profitable.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 1 Description of Business and Basis

of Presentation – (Continued)

Management believes that the current

working capital position will be sufficient to meet the Company’s working capital requirements beyond the next 12 months

after the date that these interim condensed consolidated financial statements are issued.

The process of drug development can be

costly, and the timing and outcomes of clinical trials is uncertain.

The assumptions upon which the Company has based its

estimates are routinely evaluated and may be subject to change.

The actual amount of the Company’s expenditures will

vary depending upon a number of factors including but not limited to the design, timing and duration of future clinical trials,

the progress of the Company’s research and development programs and the level of financial resources available.

has the ability to adjust its operating plan spending levels based on the timing of future clinical trials.

Other than our rights related to

the Sales Agreement (as defined below in Note 5), there can be no assurance that additional financing will be available to us when

needed or, if available, that it can be obtained on commercially reasonable terms.

If the Company is not able to obtain the additional

financing on a timely basis, if and when it is needed, it will be forced to delay or scale down some or all of its research and

development activities.

Coronavirus Disease 2019 (COVID-19)

The recent global outbreak of COVID-19

has not had a material impact on the Company’s result of operations or financial condition as of December 31, 2021.

pandemic continues to rapidly evolve as of the date these consolidated financial statements are issued and has created a dynamic and uncertain

situation in the global economy.

The recent global outbreak of COVID-19 has

not had a material impact on the Company’s results of operations or financial condition as of March 31, 2022.

However, the pandemic

continues to rapidly evolve as of the date these condensed consolidated interim financial statements are issued and has created a dynamic

and uncertain situation in the global economy.

As such, it is uncertain as to the full magnitude that the outbreak will have on the Company’s

4 unchanged sentences

to curb its spread, the Company is not able to estimate the effects COVID-19 may have on its future results of operations or financial

The preparation of financial

statements in accordance with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of

assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting

The Company regularly evaluates estimates and assumptions related to accounting for research and development costs,

incentive income receivable, valuation and recoverability of deferred tax assets, asset impairment, stock-based compensation, and

loss contingencies.

The Company bases its estimates and assumptions on current facts, historical experience, and various other

factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about

the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other

The actual results experienced by the Company may differ materially and adversely from the Company’s estimates.

the extent there are material differences between the estimates and the actual results, future results of operations will be

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 1 Description of Business and Basis of

Presentation – (Continued)

Use of Estimates

The preparation of financial statements

in accordance with U.S.

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and

liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period.

Company regularly evaluates estimates and assumptions related to accounting for research and development costs, incentive income

receivable, valuation and recoverability of deferred tax assets, asset impairment, stock-based compensation, and loss contingencies.

The Company bases its estimates and assumptions on current facts, historical experience, and various other factors that it believes

to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of

assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.

The actual results

experienced by the Company may differ materially and adversely from the Company’s estimates.

To the extent there are material

differences between the estimates and the actual results, future results of operations will be affected.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 1 Description of Business and Basis

of Presentation – (Continued)

Principles of Consolidation

2 unchanged sentences

and its wholly-owned subsidiaries, Anavex Australia Pty Limited.

(“Anavex Australia”),

a company incorporated under the laws of Australia, Anavex Germany GmbH, a company incorporated under the laws of Germany, and Anavex

Canada Ltd., a company incorporated under the laws of the Province of Ontario, Canada.

All inter-company transactions and balances have

been eliminated.

Value Measurements

The fair value hierarchy under GAAP is

based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be used to measure

fair value which are the following:

Level 1 - quoted

prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - observable

inputs other than Level 1, quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar

assets and liabilities in markets that are not active, and model-derived prices whose inputs are observable or whose significant value

drivers are observable;

Level 3 - assets

and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant to the fair

value of the assets or liabilities.

The book value of cash and cash equivalents

and accounts payable and accrued liabilities approximate their fair values due to the short-term maturity of those instruments.

At December 31, 2021 and September 30,

Australia”), a company incorporated under the laws of Australia, Anavex Germany GmbH, a company incorporated under the laws

of Germany, and Anavex Canada Ltd., a company incorporated under the laws of the Province of Ontario, Canada.

All inter-company

transactions and balances have been eliminated.

Fair Value Measurements

The fair value hierarchy under

GAAP is based on three levels of inputs, of which the first two are considered observable and the last unobservable, that may be

used to measure fair value which are the following:

quoted prices (unadjusted) in active markets for identical assets or liabilities;

- observable inputs other than Level 1, quoted prices for similar assets or liabilities in active

markets, quoted prices for identical or similar assets and liabilities in markets that are not active, and

model-derived prices whose inputs are observable or whose significant value drivers are observable;

assets and liabilities whose significant value drivers are unobservable by little or no market activity and that are significant

to the fair value of the assets or liabilities.

The book value of cash and cash

equivalents and accounts payable and accrued liabilities approximate their fair values due to the short-term maturity of those

At March 31, 2022 and September

30, 2021, the Company did not have any Level 3 assets or liabilities.

and Diluted Loss per Share

Basic income/(loss) per common share is

computed by dividing net income/(loss) available to common stockholders by the weighted average number of common shares outstanding during

Diluted income/(loss) per common share is computed by dividing net income/(loss) available to common stockholders by the sum

of (1) the weighted-average number of common shares outstanding during the period, (2) the dilutive effect of the assumed exercise of

options and warrants using the treasury stock method and (3) the dilutive effect of other potentially dilutive securities.

of the diluted net loss per share calculation, options and warrants are potentially dilutive securities and are excluded from the calculation

of diluted net loss per share because their effect would be anti-dilutive.

As of December 31, 2021, loss per share

excludes 11,403,769 (September 30, 2021 – 11,540,903 ) potentially dilutive common shares related to outstanding options and warrants,

as their effect was anti-dilutive.

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Basic and Diluted

Loss per Share

Basic income/(loss) per common

share is computed by dividing net income/(loss) available to common stockholders by the weighted average number of common shares

outstanding during the period.

Diluted income/(loss) per common share is computed by dividing net income/(loss) available to common

stockholders by the sum of (1) the weighted-average number of common shares outstanding during the period, (2) the dilutive effect

of the assumed exercise of options and warrants using the treasury stock method and (3) the dilutive effect of other potentially

dilutive securities.

For purposes of the diluted net loss per share calculation, options and warrants are potentially dilutive

securities and are excluded from the calculation of diluted net loss per share because their effect would be anti-dilutive.

As of March 31, 2022, loss per

share excludes 11,510,319 (September 30, 2021 – 11,540,903 ) potentially dilutive common shares related to outstanding options

and warrants, as their effect was anti-dilutive.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 2 Recent Accounting Pronouncements

Recently Adopted

Accounting Pronouncements

Effective October

1, 2021, the Company adopted ASU 2019-12, “Simplifying the Accounting for Income Taxes (ASC 740)”, which is intended to simplify

various aspects related to accounting for income taxes by removing certain exceptions to the general principles in Topic 740 and clarifying

and amending existing guidance to improve consistent application.

There was no material impact on the Company’s operations, financial

condition, or cash flows.

Adopted Accounting Pronouncements

October 1, 2021, the Company adopted ASU 2019-12, “Simplifying the Accounting for Income Taxes (ASC 740)”, which is

intended to simplify various aspects related to accounting for income taxes by removing certain exceptions to the general principles

in Topic 740 and clarifying and amending existing guidance to improve consistent application.

There was no material impact on the

Company’s operations, financial condition, or cash flows.

Note 3 Other Income

During the year

ended September 30, 2021, the Company received $ 497,931 of a $995,862 research grant awarded by the Michael J.

Fox Foundation for Parkinson’s

The grant will be used to fund a clinical trial of the Company’s lead compound, ANAVEX ® 2-73 related to

Parkinson’s disease.

The grant income

is being deferred when received and amortized to other income as the related research and development expenditures are incurred.

the three months ended December 31, 2021 and 2020, the Company did not recognize any of this grant on its statements of operations.

December 31, 2021, an amount of $ 443,831 (September 30, 2021:

$ 443,831 ) of this grant is recorded as deferred grant income, representing

the amount of this grant which has not yet been amortized to other income.

The Company will recognize this income on its statement of

operations as the relating expenditures are incurred to offset the income.

Research and development

incentive income

Research and development

incentive income represents the receipt by Anavex Australia, of the Australian research and development incentive credit, (the “R&D

Incentive Credit”).

During the three

months ended December 31, 2021, the Company recorded research and development incentive income of $ 810,730 (AUD 1,116,362 ) (2020:

(AUD 1,735,962 )) in respect of the R&D Incentive Credit for eligible research and development expenses incurred during the period.

year ended September 30, 2021, the Company received $ 497,931 of a $ 995,862 research grant awarded by the Michael J.

Fox Foundation

for Parkinson’s Research.

The grant will be used to fund a clinical trial of the Company’s lead compound, ANAVEX ® 2-73

related to Parkinson’s disease.

grant income is being deferred when received and amortized to other income as the related research and development expenditures are

During the three and six months ended March 31, 2022, the Company did not recognize any of this grant on its statements of

operations (2021:

$ 10,820 and $ 10,820 , respectively).

At March 31, 2022, an amount of $ 443,831

(September 30, 2021:

of this grant is recorded as deferred grant income, representing the amount of this grant which has not yet been amortized to other

The Company will recognize this income on its statement of operations as the relating expenditures are incurred to offset

and development incentive income

and development incentive income represents the receipt by Anavex Australia, of the Australian research

and development incentive credit, (the “R&D Incentive Credit”).

three and six months ended March 31, 2022 the Company recorded research and development incentive income of $ 835,513 (AUD 1,146,955 )

and $ 1,646,243 (AUD 2,263,317 ) (2021:

$ 960,879 (AUD 1,244,133 ) and $ 2,230,195 (AUD 2,980,095 )), respectively, related to the R&D

Incentive Credit for eligible research and development expenses incurred during the period.

Note 4 Accrued liabilities

The principal components of accrued liabilities consists of:

The principal components of accrued liabilities

Schedule of Accrued Liabilities

3 unchanged sentences

Fixed contract accruals

Accrued license fees payables

All other accrued liabilities

Total accrued liabilities

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 5 Equity Offerings

Common shares are voting and are entitled

to dividends as declared at the discretion of the Board of Directors.

Common shares are voting and are

entitled to dividends as declared at the discretion of the Board of Directors.

Preferred Stock

The Company’s Board of Directors

(the “Board”) has the authority to issue preferred stock in one or more series and to fix the rights, preferences, privileges,

restrictions and the number of shares constituting any series of the designation of the series.

(the “Board”) has the authority to issue preferred stock in one or more series and to fix the rights, preferences,

privileges, restrictions and the number of shares constituting any series of the designation of the series.

Sales Agreement

The Company entered into a Controlled

Equity Offering Sales Agreement on July 6, 2018, which was amended and restated on May 1, 2020 (the “Sales Agreement”) with

Cantor Fitzgerald & Co.

and SVB Leerink LLC (together the “Sales Agents”), pursuant to which the Company may offer

and sell shares of common stock registered under an effective registration statement from time to time through the Sales Agents (the “Offering”).

Upon delivery of a placement notice based

on the Company’s instructions and subject to the terms and conditions of the Sales Agreement, the Sales Agents may sell the Shares

by methods deemed to be an “at the market offering” offering, in negotiated transactions at market prices prevailing at the

time of sale or at prices related to such prevailing market prices, or by any other method permitted by law, including negotiated transactions,

subject to the prior written consent of the Company.

The Company is not obligated to make any sales of Shares under the Sales Agreement.

The Company or Sales Agents may suspend or terminate the offering of Shares upon notice to the other party, subject to certain conditions.

The Sales Agents will act as agent on a commercially reasonable efforts basis consistent with their normal trading and sales practices

and applicable state and federal law, rules and regulations and the rules of Nasdaq.

The Company has agreed to pay the Sales

Agents commissions for their services of up to 3.0% of the gross proceeds from the sale of the Shares pursuant to the Sales Agreement.

Equity Offering Sales Agreement on July 6, 2018, which was amended and restated on May 1, 2020 (the “Sales Agreement”)

with Cantor Fitzgerald & Co.

and SVB Leerink LLC (together the “Sales Agents”), pursuant to which the Company

may offer and sell shares of common stock registered under an effective registration statement from time to time through the Sales

Agents (the “Offering”).

Upon delivery of a placement notice

based on the Company’s instructions and subject to the terms and conditions of the Sales Agreement, the Sales Agents may

sell the Shares by methods deemed to be an “at the market offering” offering, in negotiated transactions at market

prices prevailing at the time of sale or at prices related to such prevailing market prices, or by any other method permitted by

law, including negotiated transactions, subject to the prior written consent of the Company.

The Company is not obligated to make

any sales of Shares under the Sales Agreement.

The Company or Sales Agents may suspend or terminate the offering of Shares upon

notice to the other party, subject to certain conditions.

The Sales Agents will act as agent on a commercially reasonable efforts

basis consistent with their normal trading and sales practices and applicable state and federal law, rules and regulations

and the rules of Nasdaq.

The Company has agreed to pay the

Sales Agents commissions for their services of up to 3.0 % of the gross proceeds from the sale of the Shares pursuant to the Sales

The Company also agreed to provide the Sales Agents with customary indemnification and contribution rights.

During the three months ended

December 31, 2021, 99,588 shares were sold pursuant to the Offering for gross proceeds of $ 2,312,785 (net proceeds of $ 2,149,701 after

deducting offering expenses) (December 31, 2020:

1,514,829 shares were sold for gross proceeds of $ 8,782,017 (net proceeds of $ 8,518,557 )).

At December 31, 2021, an amount of $ 161,079,765 (September 30, 2021:

$ 163,392,550 ) was registered pursuant to an effective registration

statement and remained available to be sold under the Sales Agreement.

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 5 Equity Offerings – (continued)

six months ended March 31, 2022, 1,066,389 shares were sold pursuant to the Offering for gross proceeds of $ 14,803,464 (net proceeds

of $ 14,265,658 after deducting offering expenses) (2021:

3,552,313 shares were sold for gross proceeds of $ 37,823,241 (net proceeds

of $ 36,688,544 after deducting offering expenses)).

At March 31, 2022, an amount of $ 148,589,086 (September 30, 2021:

$ 163,392,550 )

was registered pursuant to an effective registration statement and remained available to be sold under the Sales Agreement.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 5 Equity Offerings

– (continued)

2019 Purchase Agreement

On June 7, 2019, the Company entered into

a $ 50,000,000 purchase agreement (the “2019 Purchase Agreement”) with Lincoln Park, as amended on July 1, 2020, pursuant to

which the Company had the right to sell and issue to Lincoln Park, and Lincoln Park was obligated to purchase, up to $ 50,000,000 in value

of its shares of common stock from time to time over a three-year period until July 1, 2022.

In consideration for entering into the

2019 Purchase Agreement, the Company issued to Lincoln Park 324,383 shares of common stock as a commitment fee during the year ended September

30, 2019 and agreed to issue up to 162,191 shares pro rata, when and if, Lincoln Park purchased, at the Company’s discretion, the

$50,000,000 aggregate commitment.

At December 31, 2021 and September 30,

On June 7, 2019, the Company entered

into a $ 50,000,000 purchase agreement (the “2019 Purchase Agreement”) with Lincoln Park, as amended on July 1, 2020,

pursuant to which the Company had the right to sell and issue to Lincoln Park, and Lincoln Park was obligated to purchase, up to

$ 50,000,000 in value of its shares of common stock from time to time over a three-year period until July 1, 2022.

In consideration for entering into

the 2019 Purchase Agreement, the Company issued to Lincoln Park 324,383 shares of common stock as a commitment fee during the year

ended September 30, 2019 and agreed to issue up to 162,191 shares pro rata, when and if, Lincoln Park purchased, at the Company’s

discretion, the $50,000,000 aggregate commitment.

At March 31, 2022 and September

30, 2021, no shares remained available for issuance under the 2019 Purchase Agreement.

During the three months ended December 31, 2020, the

Company issued to Lincoln Park an aggregate of 3,402,930 shares of common stock including 3,346,288 shares of common stock for an aggregate

purchase price of $ 17,461,402 and 56,642 commitment shares.

During the six months ended March

31, 2021, the Company issued to Lincoln Park an aggregate of 4,086,209 shares of common stock including 4,007,996 shares of common

stock for an aggregate purchase price of $ 24,111,198 and 78,213 commitment shares.

Note 6 Commitments and Contingencies

three months ended December 31, 2021, the Company incurred office lease expense of $ 4,845 (2020:

the three and six months ended March 31, 2022, the Company incurred office lease expense of $ 16,488 and $ 21,333 (2021:

and $ 98,290 ), respectively.

b) Employee 401(k) Benefit Plan

has a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code.

The plan covers all United States based employees.

United States based employees eligible to participate in the plan may contribute up to the current statutory limits under the Internal

Revenue Service regulations.

The 401(k) plan permits the Company to make additional matching contributions on behalf of contributing employees.

During the three months ended December 31, 2021, the Company made $ 22,682 (2020:

$ 16,556 ) in matching contributions under the 401(k) plan.

Company has a defined-contribution savings plan under Section 401(k) of the Internal Revenue Code.

The plan covers all United States

based employees.

United States based employees eligible to participate in the plan may contribute up to the current statutory limits

under the Internal Revenue Service regulations.

The 401(k) plan permits the Company to make additional matching contributions on

behalf of contributing employees.

During the three and six months ended March 31, 2022, the Company made $ 70,940 and $ 93,622 (2021:

$ 57,484 and $ 74,040 ), respectively, in matching contributions under the 401(k) plan.

c) Litigation

is subject to claims and legal proceedings that arise in the ordinary course of business.

Such matters are inherently uncertain, and

there can be no guarantee that the outcome of any such matter will be decided favorably to the Company or that the resolution of any

such matter will not have a material adverse effect upon the Company’s consolidated financial statements.

The Company does not

believe that any of such pending claims and legal proceedings will have a material adverse effect on its consolidated financial statements.

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 6 Commitments and Contingencies – (Continued)

Company is subject to claims and legal proceedings that arise in the ordinary course of business.

Such matters are inherently uncertain,

and there can be no guarantee that the outcome of any such matter will be decided favorably to the Company or that the resolution

of any such matter will not have a material adverse effect upon the Company’s consolidated financial statements.

does not believe that any of such pending claims and legal proceedings will have a material adverse effect on its consolidated

financial statements.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 6 Commitments and Contingencies

– (Continued)

d) Share Purchase Warrants

2 unchanged sentences

Schedule of exercisable share purchase warrants outstanding

Average Exercise

Exercise Price

Balance, September 30, 2020

Balance, September 30, 2021

Balance, December 31, 2021

At December 31, 2021,

Balance, March 31, 2022

2022, the Company had share purchase warrants outstanding as follows:

7 unchanged sentences

stock awards to directors, officers, employees and consultants of the Company.

The maximum number of our common shares reserved

for issue under the plan was 6,050,553 shares, subject to adjustment in the event of a change of the Company’s capitalization.

December 31, 2021, 146,371 (September 30, 2021:

146,371 ) options remain available for issue under the 2015 Plan.

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

The maximum number of our common shares

reserved for issue under the plan was 6,050,553 shares, subject to adjustment in the event of a change of the Company’s capitalization.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 6 Commitments and Contingencies – (Continued)

1 unchanged sentence

2019 Stock Option Plan

On January 15, 2019, the Board approved the

2019 Omnibus Incentive Plan (the “2019 Plan”), which provides for the grant of stock options and restricted stock awards to

directors, officers, employees, consultants and advisors of the Company.

Under the terms of the 2019 Plan, 6,000,000 additional shares

of Common Stock are available for issuance under the 2019 Plan, in addition to the shares available under the 2015 Plan.

Any awards outstanding

under the 2015 Plan or the Company’s 2007 Stock Option Plan (the “2007 Plan”) will remain subject to and be paid under

the 2015 Plan or the 2007 Plan, respectively, and any shares subject to outstanding awards under the 2015 Plan or the 2007 Plan that subsequently

cease to be subject to such awards (other than by reason of settlement of the awards in shares) will automatically become available for

issuance under the 2019 Plan.

The 2019 Plan provides that it may be administered

by the Board, or the Board may delegate such responsibility to a committee.

The exercise price will be determined by the Board at the

time of grant shall be at least equal to the fair market value on such date.

If the grantee is a 10% stockholder on the grant date, then

the exercise price shall not be less than 110% of fair market value of the Company’s shares of common stock on the grant date.

options may be granted under the 2019 Plan for an exercise period of up to ten years from the date of grant of the option or such lesser

periods as may be determined by the board, subject to earlier termination in accordance with the terms of the 2019 Plan.

At December 31,

2021, 406,332 (September 30, 2021:

456,332 ) options remain available for issue under the 2019 Plan.

On January 15, 2019, the Board approved

the 2019 Omnibus Incentive Plan (the “2019 Plan”), which provides for the grant of stock options and restricted stock

awards to directors, officers, employees, consultants and advisors of the Company.

The maximum number of our common shares

reserved for issue under the plan was 6,000,000 shares, subject to adjustment in the event of a change of the Company’s capitalization.

At March 31, 2022, 406,453 options

previously available under the 2019 Plan and the 2015 Plan became available under the 2022 Plan.

2022 Stock Option Plan

On March 25, 2022, the Board approved,

subject to stockholder approval, the 2022 Omnibus Incentive Plan (the “2022 Plan”).

Under the terms of the 2022 Plan,

10,000,000 additional shares of Common Stock will be available for issuance under the plan, in addition to the shares available

under the 2019 Plan and the 2015 Plan.

Any awards outstanding under a previous stock option plan will remain subject to and be

paid under such plan, and any shares subject to outstanding awards under a previous plan that subsequently cease to be subject

to such awards (other than by reason of settlement of the awards in shares) will automatically become available for issuance under

the 2022 Plan.

The 2022 Plan provides that it may

be administered by the Board, or the Board may delegate such responsibility to a committee.

The exercise price will be determined

by the Board at the time of grant shall be at least equal to the fair market value on such date.

If the grantee is a 10% stockholder

on the grant date, then the exercise price shall not be less than 110% of fair market value of the Company’s shares of common

stock on the grant date.

Stock options may be granted under the 2022 Plan for an exercise period of up to ten years from the date

of grant of the option or such lesser periods as may be determined by the board, subject to earlier termination in accordance with

the terms of the 2022 Plan.

At March 31, 2022, no awards had been issued under the 2022 Plan and 10,406,453 options were available

for issue under the 2022 Plan, subject to stockholder approval.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 6 Commitments and Contingencies – (Continued)

e) Stock-based Compensation Plan – (Continued)

A summary of the status of Company’s

3 unchanged sentences

Exercise Price

Date Fair Value

intrinsic value

Outstanding, September 30, 2020

( 1,421,529 )

Outstanding, September 30, 2021

Outstanding, December 31, 2021

Exercisable, December 31, 2021

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 6 Commitments and Contingencies – (Continued)

e) Stock-based Compensation Plan – (Continued)

The following summarizes information about

stock options at December 31, 2021 by a range of exercise prices:

Outstanding, March 31, 2022

Exercisable, March 31, 2022

The following summarizes information

about stock options at March 31, 2022 by a range of exercise prices:

Schedule Of Share-based Payment Arrangement, Option, Activity

1 unchanged sentence

life (in years)

vested options

The weighted average grant date fair value

of options vested during the three months ended December 31, 2021 was $ 2.85 (2020:

At December 31, 2021, the weighted average

contractual life of options outstanding was 6.54 years (September 30, 2021:

6.79 years) and for options exercisable was 5.31 years (September

The weighted average grant date

fair value of options vested during the three and six months ended March 31, 2022 was $ 3.20 (2021:

At March 31, 2022, the

weighted average contractual life of options outstanding was 6.29 years (September 30, 2021:

6.79 years) and for options exercisable

was 5.37 years (September 30, 2021:

The aggregate intrinsic value is calculated

as the difference between the exercise price of the underlying awards and the quoted market price of the Company’s stock for the

options that were in-the-money at December 31, 2021.

During the three months ended December 31,

2021, the Company recognized stock-based compensation expense of $ 3,908,771 (2020:

$ 939,314 ) in connection with the issuance and vesting

of stock options and warrants in exchange for services.

These amounts have been included in general and administrative expenses

and research and development expenses on the Company’s statement of operations as follows:

as the difference between the exercise price of the underlying awards and the quoted market price of the Company’s stock

for the options that were in-the-money at March 31, 2022.

Life Sciences Corp.

the Condensed Consolidated Interim Financial Statements

Note 6 Commitments and Contingencies – (Continued)

e) Stock-based Compensation Plan – (Continued)

Schedule of general and administrative expenses and research and development expenses

Three months ended March 31,

Six months ended March 31,

General and administrative

1 unchanged sentence

Total stock-based compensation

An amount of approximately $ 18,170,000 in

stock-based compensation is expected to be recorded over the remaining term of such options through fiscal 2025.

Anavex Life Sciences Corp.

Notes to the Condensed Consolidated Interim Financial Statements

December 31, 2021

Note 6 Commitments and Contingencies – (Continued)

e) Stock-based Compensation Plan – (Continued)

The fair value of each option

award granted during the three months ended December 31, 2021 and 2020 is estimated on the date of grant using the Black Scholes option

pricing model based on the following weighted average assumptions:

the three and six months ended March 31, 2022, the Company recognized stock-based compensation expense of $ 4,439,456 and $ 8,348,230

$ 1,846,156 and $ 2,785,470 ), respectively, in connection with the issuance and vesting of stock options and warrants

in exchange for services.

These amounts have been included in general and administrative expenses and research and development

expenses on the Company’s statement of operations as follows:

An amount of approximately $ 16,030,270

in stock-based compensation is expected to be recorded over the remaining term of such options through fiscal 2025.

The fair value

of each option award granted during the three and six months ended March 31, 2022 and 2021 is estimated on the date of grant using

the Black Scholes option pricing model based on the following weighted average assumptions:

Schedule of weighted average assumptions for fair value of each option award

3 unchanged sentences

Dividend rate

The fair value of stock compensation charges

recognized during the three months ended December 31, 2021 and 2020 was determined with reference to the quoted market price of the Company’s

shares on the grant date.

The fair value of stock compensation

charges recognized during the three and six months ended March 31, 2022 and 2021 was determined with reference to the quoted market

price of the Company’s shares on the grant date.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements