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Item 2. Management’s Discussion and Analysis

2023-05-09 compared with 2023-02-07 · 776 added, 655 removed, 196 unchanged (88% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

MANAGEMENT’S DISCUSSION AND

ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking

All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q, including statements

regarding our anticipated future clinical and regulatory milestone events, future financial position, business strategy and plans and

objectives of management for future operations, are forward-looking statements.

The words “believe,” “may,” “estimate,”

“continue,” “anticipate,” “intend,” “expect” “should,” “forecast,”

“potential,” “predict”, “could,” “would,” “will,” “suggest,” “plan”

and similar expressions, as they relate to us, are intended to identify forward-looking statements.

Such forward-looking statements include,

without limitation, statements regarding:

This Quarterly Report on Form 10-Q includes

forward-looking statements.

All statements other than statements of historical facts contained in this Quarterly Report on Form

10-Q, including statements regarding our anticipated future clinical and regulatory milestone events, future financial position,

business strategy and plans and objectives of management for future operations, are forward-looking statements.

The words “believe,”

“may,” “estimate,” “continue,” “anticipate,” “intend,” “expect”

“should,” “forecast,” “potential,” “predict”, “could,” “would,”

“will,” “suggest,” “plan” and similar expressions, as they relate to us, are intended to identify

forward-looking statements.

Such forward-looking statements include, without limitation, statements regarding:

volatility in our stock price and in the markets in general;

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our anticipated future cash position and ability to obtain funding for our operations.

We have based these forward-looking statements largely

on our current expectations and projections about future events, including the responses we expect from the U.S.

Food and Drug Administration,

(“FDA”), and other regulatory authorities and financial trends that we believe may affect our financial condition, results

of operations, business strategy, preclinical studies and clinical trials, and financial needs.

These forward-looking statements are subject

to a number of risks, uncertainties and assumptions including without limitation the risks described in “Risk Factors” in

Part I, Item 1A of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on November 28, 2022.

are not exhaustive.

Other sections of this Quarterly Report on Form 10-Q include additional factors which could adversely impact our business

and financial performance.

Moreover, we operate in a very competitive and rapidly changing environment.

New risk factors emerge from time

to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business

or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any

forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events.

We cannot assure you

that the events and circumstances reflected in the forward-looking statements will be achieved or occur and actual results could differ

materially from those projected in the forward-looking statements.

Except as required by applicable laws including the securities laws

of the United States, we assume no obligation to update or supplement forward-looking statements.

As used in this Quarterly Report on Form 10-Q, the

terms “we,” “us,” “our,” “Company”, and “Anavex” mean Anavex Life Sciences

Corp., unless the context clearly indicates otherwise.

We have based these forward-looking statements

largely on our current expectations and projections about future events, including the responses we expect from the U.S.

Drug Administration, (“FDA”), and other regulatory authorities and financial trends that we believe may affect our

financial condition, results of operations, business strategy, preclinical studies and clinical trials, and financial needs.

forward-looking statements are subject to a number of risks, uncertainties and assumptions including without limitation the risks

described in “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K filed with the Securities and Exchange

Commission on November 28, 2022.

These risks are not exhaustive.

Other sections of this Quarterly Report on Form 10-Q include additional

factors which could adversely impact our business and financial performance.

Moreover, we operate in a very competitive and rapidly

changing environment.

New risk factors emerge from time to time and it is not possible for our management to predict all risk factors,

nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause

actual results to differ materially from those contained in any forward-looking statements.

You should not rely upon forward-looking

statements as predictions of future events.

We cannot assure you that the events and circumstances reflected in the forward-looking

statements will be achieved or occur and actual results could differ materially from those projected in the forward-looking statements.

Except as required by applicable laws including the securities laws of the United States, we assume no obligation to update or

supplement forward-looking statements.

As used in this Quarterly Report on Form 10-Q,

the terms “we,” “us,” “our,” “Company”, and “Anavex” mean Anavex Life

Sciences Corp., unless the context clearly indicates otherwise.

Our Current Business

Anavex Life Sciences Corp.

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.

We analyze genomic data from clinical trials to identify biomarkers, which we use in the analysis of our

clinical trials.

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.

We analyze genomic data from clinical trials to identify biomarkers,

which we use in the analysis of our clinical trials.

Our lead product candidate, 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”).

We currently have two core programs and two seed programs.

Our core programs are at various stages of clinical and preclinical development, in neurodegenerative and neurodevelopmental 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”).

We currently have two core programs and two

seed programs.

Our core programs are at various stages of clinical and preclinical development, in neurodegenerative and neurodevelopmental

The following table summarizes key information about our programs:

* = Orphan Drug Designation by the FDA;

lines indicate planned clinical trials to-date

Anavex has a portfolio of compounds varying in sigma-1

receptor (SIGMAR1) binding activities.

The SIGMAR1 gene encodes the SIGMAR1 protein, which is an intracellular chaperone protein with

important roles in cellular communication.

SIGMAR1 is also involved in transcriptional regulation at the nuclear envelope and restores

homeostasis and stimulates recovery of cell function when activated.

In order to validate the ability of our compounds to activate quantitatively

the SIGMAR1, we performed, in collaboration with Stanford University, a quantitative Positron Emission Tomography (PET) imaging scan in

mice, which demonstrated a dose-dependent ANAVEX ® 2-73 target engagement or receptor occupancy with SIGMAR1 in the brain.

al., Sci Rep.

Dashed lines indicate planned clinical trials to-date

Anavex has a portfolio of compounds varying

in sigma-1 receptor (SIGMAR1) binding activities.

The SIGMAR1 gene encodes the SIGMAR1 protein, which is an intracellular chaperone

protein with important roles in cellular communication.

SIGMAR1 is also involved in transcriptional regulation at the nuclear envelope

and restores homeostasis and stimulates recovery of cell function when activated.

In order to validate the ability of our compounds

to activate quantitatively the SIGMAR1, we performed, in collaboration with Stanford University, a quantitative Positron Emission

Tomography (PET) imaging scan in mice, which demonstrated a dose-dependent ANAVEX ® 2-73 target engagement or receptor

occupancy with SIGMAR1 in the brain.

Reyes S et al., Sci Rep.

Cellular Homeostasis

Many diseases are possibly directly caused by chronic

homeostatic imbalances or cellular stress of brain cells.

In pediatric diseases, such as Rett syndrome or infantile spasms, the chronic

cellular stress is possibly caused by the presence of a constant genetic mutation.

In neurodegenerative diseases, such as Alzheimer’s

and Parkinson’s diseases, chronic cellular stress is possibly caused by age-correlated buildup of cellular insult and hence chronic

cellular stress.

Specifically, defects in homeostasis of protein or ribonucleic acid (“RNA”) lead to the death of neurons

and dysfunction of the nervous system.

The spreading of protein aggregates resulting in a proteinopathy, a characteristic found in Alzheimer’s

and Parkinson’s diseases that results from disorders of protein synthesis, trafficking, folding, processing or degradation in cells.

The clearance of macromolecules in the brain is particularly susceptible to imbalances that result in aggregation and degeneration in

For example, Alzheimer’s disease pathology is characterized by the presence of amyloid plaques, and neurofibrillary

tangles, which are aggregates of hyperphosphorylated Tau protein that are a marker of other diseases known as tauopathies as well as inflammation

of microglia.

With the SIGMAR1 activation through SIGMAR1 agonists like ANAVEX ® 2-73, our approach is to restore cellular

balance (i.e.

Many diseases are possibly directly caused

by chronic homeostatic imbalances or cellular stress of brain cells.

In pediatric diseases, such as Rett syndrome or infantile

spasms, the chronic cellular stress is possibly caused by the presence of a constant genetic mutation.

In neurodegenerative diseases,

such as Alzheimer’s and Parkinson’s diseases, chronic cellular stress is possibly caused by age-correlated buildup

of cellular insult and hence chronic cellular stress.

Specifically, defects in homeostasis of protein or ribonucleic acid (“RNA”)

lead to the death of neurons and dysfunction of the nervous system.

The spreading of protein aggregates resulting in a proteinopathy,

a characteristic found in Alzheimer’s and Parkinson’s diseases that results from disorders of protein synthesis, trafficking,

folding, processing or degradation in cells.

The clearance of macromolecules in the brain is particularly susceptible to imbalances

that result in aggregation and degeneration in nerve cells.

For example, Alzheimer’s disease pathology is characterized by

the presence of amyloid plaques, and neurofibrillary tangles, which are aggregates of hyperphosphorylated Tau protein that are

a marker of other diseases known as tauopathies as well as inflammation of microglia.

With the SIGMAR1 activation through SIGMAR1

agonists like ANAVEX ® 2-73, our approach is to restore cellular balance (i.e.

homeostasis).

Therapies that correct defects in cellular homeostasis might have the potential to halt or delay neurodevelopmental

and neurodegenerative disease progression.

Therapies that correct

defects in cellular homeostasis might have the potential to halt or delay neurodevelopmental and neurodegenerative disease progression.

ANAVEX ® 2-73-specific Biomarkers

As part of some of our clinical trials, we have incorporated

a genomic analysis to better understand potential populations for whom our clinical programs might benefit.

In our clinical trials, a

full genomic analysis of Alzheimer’s disease patients treated with ANAVEX ® 2-73 has helped us identify actionable

genetic variants.

A significant impact of the genomic biomarkers SIGMAR1, the direct target of ANAVEX ® 2-73 and COMT, a

gene involved in memory function, on the drug response level was identified, leading to an early ANAVEX ® 2-73-specific biomarker

We believe that excluding patients with SIGMAR1 identified biomarker variant (approximately 10%-20% of the population)

in prospective studies would identify approximately 80%-90% patients that would display clinically significant improved functional and

cognitive scores.

The consistency between the identified DNA and RNA data related to ANAVEX ® 2-73, which are considered

independent of Alzheimer’s disease pathology, as well as multiple endpoints and time-points, provides support for the potential

precision medicine clinical development of ANAVEX ® 2-73 by using genetic biomarkers identified within the trial population

itself to target patients who are most likely to respond to ANAVEX ® 2-73 treatment.

We may in the future utilize such an

approach in Alzheimer’s disease as well as indications like Parkinson’s disease dementia or Rett syndrome in which ANAVEX ® 2-73

is currently being studied.

As part of some of our clinical trials, we

have incorporated a genomic analysis to better understand potential populations for whom our clinical programs might benefit.

our clinical trials, a full genomic analysis of Alzheimer’s disease patients treated with ANAVEX ® 2-73 has

helped us identify actionable genetic variants.

A significant impact of the genomic biomarkers SIGMAR1, the direct target of ANAVEX ® 2-73

and COMT, a gene involved in memory function, on the drug response level was identified, leading to an early ANAVEX ® 2-73-specific

biomarker hypothesis.

We believe that excluding patients with SIGMAR1 identified biomarker variant (approximately 10%-20%

of the population) in prospective studies would identify approximately 80%-90% patients that would display clinically significant

improved functional and cognitive scores.

The consistency between the identified DNA and RNA data related to ANAVEX ® 2-73,

which are considered independent of Alzheimer’s disease pathology, as well as multiple endpoints and time-points, provides

support for the potential precision medicine clinical development of ANAVEX ® 2-73 by using genetic biomarkers identified

within the trial population itself to target patients who are most likely to respond to ANAVEX ® 2-73 treatment.

may in the future utilize such an approach in Alzheimer’s disease as well as indications like Parkinson’s disease dementia

or Rett syndrome in which ANAVEX ® 2-73 is currently being studied.

Clinical Trials Overview

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trial, consisting of Part A and Part B, which lasted a total of 57 weeks, for ANAVEX ® 2-73 in mild-to-moderate Alzheimer’s

This open-label randomized trial in Australia met both primary and secondary endpoints and was designed to assess the safety

and exploratory efficacy of ANAVEX ® 2-73 in 32 patients.

ANAVEX ® 2-73 targets sigma-1 and muscarinic receptors,

which have been shown in preclinical studies to reduce stress levels in the brain believed to restore cellular homeostasis and to reverse

the pathological hallmarks observed in Alzheimer’s disease.

In October 2017, we presented positive pharmacokinetic (“PK”)

and pharmacodynamic (“PD”) data from the Phase 2a clinical trial, which established a concentration-effect relationship between

ANAVEX ® 2-73 and trial measurements.

These measures obtained from all patients who participated in the entire 57 weeks include

exploratory cognitive and functional scores as well as biomarker signals of brain activity.

Additionally, the clinical trial appeared

to show that ANAVEX ® 2-73 activity was enhanced by its active metabolite (ANAVEX19-144), which also targets the SIGMAR1

receptor and has a half-life approximately twice as long as the parent molecule.

Two consecutive trial extensions for the Phase 2a

trial have allowed participants who completed the 52-week Part B of the trial to continue taking ANAVEX ® 2-73, providing

an opportunity to gather extended safety data for a cumulative time period of five years.

In August 2020, patients completing these Phase

2a trial extensions were granted continued access to treatment with ANAVEX ® 2-73 through the Australian Government Department

of Health – Therapeutic Goods Administration’s compassionate use Special Access Scheme.

This open-label randomized trial in Australia met both primary and secondary endpoints and was designed to assess the

safety and exploratory efficacy of ANAVEX ® 2-73 in 32 patients.

ANAVEX ® 2-73 targets sigma-1 and muscarinic

receptors, which have been shown in preclinical studies to reduce stress levels in the brain believed to restore cellular homeostasis

and to reverse the pathological hallmarks observed in Alzheimer’s disease.

In October 2017, we presented positive pharmacokinetic

(“PK”) and pharmacodynamic (“PD”) data from the Phase 2a clinical trial, which established a concentration-effect

relationship between ANAVEX ® 2-73 and trial measurements.

These measures obtained from all patients who participated

in the entire 57 weeks include exploratory cognitive and functional scores as well as biomarker signals of brain activity.

Additionally,

the clinical trial appeared to show that ANAVEX ® 2-73 activity was enhanced by its active metabolite (ANAVEX19-144),

which also targets the SIGMAR1 receptor and has a half-life approximately twice as long as the parent molecule.

Two consecutive trial extensions for the Phase

2a trial have allowed participants who completed the 52-week Part B of the trial to continue taking ANAVEX ® 2-73,

providing an opportunity to gather extended safety data for a cumulative time period of five years.

In August 2020, patients completing

these Phase 2a trial extensions were granted continued access to treatment with ANAVEX ® 2-73 through the Australian

Government Department of Health – Therapeutic Goods Administration’s compassionate use Special Access Scheme.

A larger Phase 2b/3 double-blind, placebo-controlled

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The Phase 2b/3 trial enrolled 509 patients,

which were treated with a convenient once-daily oral formulation of ANAVEX ® 2-73 for 48 weeks, randomized 1:1:1 to two different

ANAVEX ® 2-73 doses or placebo.

which were treated with a convenient once-daily oral formulation of ANAVEX ® 2-73 for 48 weeks, randomized 1:1:1 to

two different ANAVEX ® 2-73 doses or placebo.

The trial took place at 52 sites across North America, Europe and Australia.

secondary endpoints to assess safety and both cognitive and functional efficacy, were measured through the Alzheimer’s Disease Assessment

Scale – Cognitive Subscale test (“ADAS-Cog”), Alzheimer’s Disease Cooperative Study – Activities of Daily

Living (“ADCS-ADL”) and Clinical Dementia Rating – Sum of Boxes for cognition and function (“CDR-SB”).

addition to the primary endpoints, the ANAVEX ® 2-73 Phase 2b/3 trial design incorporated pre-specified statistical analyses

related to potential genomic precision medicine biomarkers previously identified in the ANAVEX ® 2-73 Phase 2a clinical trial.

The trial completed in mid-2022 and, in December 2022, the Company presented positive topline results from the Phase 2b/3 clinical trial.

ANAVEX ® 2-73 met the co-primary endpoints

ADAS-Cog and ADCS-ADL and key secondary endpoint CDR-SB.

ANAVEX ® 2-73 treatment slowed decline of cognition and function

in patients with early Alzheimer’s disease over 48 weeks.

Patients treated with ANAVEX ® 2-73 had 1.84 times higher

odds, or likelihood, to improve cognitively compared to placebo, with a ADAS-Cog score threshold change of -0.5 points or better [Odds

Ratio = 1.84 (p = 0.015)].

At clinically significant levels of improvement in function (ADCS-ADL score threshold change of +3.5 points

or better), patients treated with ANAVEX ® 2-73 had 2.67 times higher odds, or likelihood, to improve function compared to

placebo [Odds Ratio = 2.67 (p = 0.0255)].

Additionally, treatment with ANAVEX ® 2-73 reduced cognitive decline at end of

treatment, measured with the ADAS-Cog, as compared to placebo, by 45%, representing a treatment difference in mean score change of -1.85

points (p=0.033).

Compared to placebo, ANAVEX ® 2-73 reduced clinical decline of cognition and function by 27% with mean

score difference of -0.42 points (p=0.040) as measured by the CDR-SB.

Primary and secondary endpoints to assess safety and both cognitive and functional efficacy, were measured through the Alzheimer’s

Disease Assessment Scale – Cognitive Subscale test (“ADAS-Cog”), Alzheimer’s Disease Cooperative Study

– Activities of Daily Living (“ADCS-ADL”) and Clinical Dementia Rating – Sum of Boxes for cognition and

function (“CDR-SB”).

In addition to the primary endpoints, the ANAVEX ® 2-73 Phase 2b/3 trial design incorporated

pre-specified statistical analyses related to potential genomic precision medicine biomarkers previously identified in the ANAVEX ® 2-73

Phase 2a clinical trial.

The trial was completed in mid-2022 and, in December 2022, the Company presented positive topline results

from the Phase 2b/3 clinical trial.

ANAVEX ® 2-73 met the co-primary

endpoints ADAS-Cog and ADCS-ADL and key secondary endpoint CDR-SB.

ANAVEX ® 2-73 treatment slowed decline of cognition

and function in patients with early Alzheimer’s disease over 48 weeks.

Patients treated with ANAVEX ® 2-73 had

1.84 times higher odds, or likelihood, to improve cognitively compared to placebo, with a ADAS-Cog score threshold change of -0.5

points or better [Odds Ratio = 1.84 (p = 0.015)].

At clinically significant levels of improvement in function (ADCS-ADL score threshold

change of +3.5 points or better), patients treated with ANAVEX ® 2-73 had 2.67 times higher odds, or likelihood, to

improve function compared to placebo [Odds Ratio = 2.67 (p = 0.0255)].

Additionally, treatment with

ANAVEX ® 2-73 reduced cognitive decline at end of treatment, measured with the ADAS-Cog, as compared to placebo, by

45%, representing a treatment difference in mean score change of -1.85 points (p=0.033).

Compared to placebo, ANAVEX ® 2-73

reduced clinical decline of cognition and function by 27% with mean score difference of -0.42 points (p=0.040) as measured by the

ANAVEX ® 2-73 was generally safe and well tolerated.

All statistical analyses were performed by outside consultancy companies.

In October 2019, we initiated a long-term open label

extension study of ANAVEX ® 2-73, entitled the ATTENTION-AD trial, for patients who have completed the 48-week Phase 2b/3

placebo-controlled trial referenced above.

This trial extension for an additional two years gives patients the opportunity to continue

their treatment.

All statistical analyses were

performed by outside consultancy companies.

In October 2019, we initiated a long-term open

label extension study of ANAVEX ® 2-73, entitled the ATTENTION-AD trial, for patients who have completed the 48-week

Phase 2b/3 placebo-controlled trial referenced above.

This trial extension for an additional two years, which is currently ongoing,

gives patients the opportunity to continue their treatment.

Rett Syndrome

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data for ANAVEX ® 2-73 in Rett syndrome, a rare neurodevelopmental disease.

The data demonstrated dose related and significant

improvements in an array of behavioral and gait paradigms in a mouse model with an MECP2-null mutation that causes neurological symptoms

that mimic Rett syndrome.

The data demonstrated dose related and

significant improvements in an array of behavioral and gait paradigms in a mouse model with an MECP2-null mutation that causes

neurological symptoms that mimic Rett syndrome.

The study was funded by the International Rett Syndrome Foundation (“Rettsyndrome.org”).

2017, we were awarded a financial grant from Rettsyndrome.org of a minimum of $0.6 million to cover some of the costs of a multicenter

Phase 2 clinical trial of ANAVEX ® 2-73 for the treatment of Rett syndrome.

This award was received in quarterly instalments

which commenced during fiscal 2018.

In March 2019, we commenced the first Phase 2 clinical

trial in a planned Rett syndrome program of ANAVEX ® 2-73 for the treatment of Rett syndrome.

The clinical trials are being

conducted in a range of patient age demographics and geographic regions, utilizing an oral liquid once-daily formulation of ANAVEX ® 2-73.

In January 2017, we were awarded a financial grant from Rettsyndrome.org of a minimum of $0.6 million to cover some of the costs

of a multicenter Phase 2 clinical trial of ANAVEX ® 2-73 for the treatment of Rett syndrome.

This award was received

in quarterly instalments which commenced during fiscal 2018.

In March 2019, we commenced the first Phase

2 clinical trial in a planned Rett syndrome program of ANAVEX ® 2-73 for the treatment of Rett syndrome.

trials are being conducted in a range of patient age demographics and geographic regions, utilizing an oral liquid once-daily formulation

of ANAVEX ® 2-73.

The first Phase 2 trial, (ANAVEX ® 2-73-RS-001),

which took place in the United States, was completed in December 2020.

This trial was a randomized double-blind, placebo-controlled safety,

tolerability, PK and efficacy trial of oral liquid ANAVEX ® 2-73 formulation in 25 adult female patients with Rett syndrome

over a 7-week treatment period including ANAVEX ® 2-73-specific genomic precision medicine biomarkers.

The primary endpoint

of the trial was safety.

The dosing of 5 mg ANAVEX ® 2-73 was well-tolerated and demonstrated dose-proportional PK.

All secondary

efficacy endpoints of the trial showed statistically significant and clinically meaningful response in the Rett Syndrome Behaviour Questionnaire

(“RSBQ”) response, when compared to placebo, in the intent to treat (“ITT”) cohort (all participants, p = 0.011).

66.7% of ANAVEX ® 2-73 treated subjects showed a statistically significant improvement in RSBQ response as compared to 10%

of the subjects on placebo in the ITT cohort (all participants, p = 0.011).

ANAVEX ® 2-73 treatment resulted in a sustained

improvement in Clinical Global Impression Improvement (CGI-I) response throughout the 7-week clinical trial, when compared to placebo

in the ITT cohort (all participants, p = 0.014).

Consistent with previous ANAVEX ® 2-73 clinical trials, patients carrying

the common form of the SIGMAR1 gene treated with ANAVEX ® 2-73 experienced stronger improvements in the prespecified efficacy

second, international trial of ANAVEX ® 2-73 for the treatment of Rett syndrome, called the AVATAR trial, commenced in June

This trial was a randomized double-blind, placebo-controlled

safety, tolerability, PK and efficacy trial of oral liquid ANAVEX ® 2-73 formulation in 25 adult female patients with

Rett syndrome over a 7-week treatment period including ANAVEX ® 2-73-specific genomic precision medicine biomarkers.

The primary endpoint of the trial was safety.

The dosing of 5 mg ANAVEX ® 2-73 was well-tolerated and demonstrated

dose-proportional PK.

All secondary efficacy endpoints of the trial showed statistically significant and clinically meaningful

response in the Rett Syndrome Behaviour Questionnaire (“RSBQ”) response, when compared to placebo, in the intent to

treat (“ITT”) cohort (all participants, p = 0.011).

66.7% of ANAVEX ® 2-73 treated subjects showed a statistically

significant improvement in RSBQ response as compared to 10% of the subjects on placebo in the ITT cohort (all participants, p =

ANAVEX ® 2-73 treatment resulted in a sustained improvement in Clinical Global Impression Improvement (CGI-I)

response throughout the 7-week clinical trial, when compared to placebo in the ITT cohort (all participants, p = 0.014).

with previous ANAVEX ® 2-73 clinical trials, patients carrying the common form of the SIGMAR1 gene treated with ANAVEX ® 2-73

experienced stronger improvements in the prespecified efficacy endpoints.

second, international trial of ANAVEX ® 2-73 for the treatment of Rett syndrome, called the AVATAR trial, commenced

in June 2019.

This trial took place in Australia and the United Kingdom using a higher dose than the U.S.

based Phase 2 trial for Rett

The trial was a Phase 3 randomized, double-blind, placebo-controlled trial to evaluate the safety and efficacy of ANAVEX ® 2-73

in 33 adult patients over a 7-week treatment period including ANAVEX ® 2-73 specific precision medicine biomarkers.

upon the input from the successful U.S.

Phase 2 Rett syndrome trial (ANAVEX ® 2-73-RS-001), we updated the endpoints for

the AVATAR trial (ANAVEX ® 2-73-RS-002) to appropriately assess the clinically meaningful outcome following International

Conference on Harmonization (ICH) guidelines.

These updates were approved by the respective regulatory authorities in the U.K.

Australia, respectively, where the AVATAR trial was conducted.

The data from the AVATAR trial was released in February

The clinical trial met all primary and secondary efficacy and safety endpoints, with consistent improvements in primary efficacy

endpoint, RSBQ response (p = 0.037), and secondary efficacy endpoints, ADAMS (p = 0.010) and CGI-I (p = 0.037) response.

Efficacy endpoints

demonstrated statistically significant and clinically meaningful reductions in Rett syndrome symptoms.

Convenient once daily oral liquid

doses of up to 30 mg of ANAVEX ® 2-73 were also well tolerated with good medication compliance.

All patients who participated

in the trial were eligible to receive ANAVEX ® 2-73 under a voluntary open label extension protocol.

In July 2020, we commenced the third trial of ANAVEX ® 2-73

for the treatment of Rett syndrome, called the EXCELLENCE trial.

This Phase 2/3 trial in pediatric patients with Rett syndrome includes

trial sites in Australia, the United Kingdom and Canada, and will evaluate the safety and efficacy of ANAVEX ® 2-73 in approximately

84 pediatric patients, aged 5 to 18, over a 12-week treatment period incorporating ANAVEX ® 2-73 specific precision medicine

This trial completed enrollment in February 2023, exceeding the original

enrollment target and topline results are expected in the second half of 2023.

All patients who participate in the trial will be eligible to receive ANAVEX ® 2-73 under a voluntary open label

extension protocol, which is currently ongoing.

based Phase 2

trial for Rett syndrome.

The trial was a Phase 3 randomized, double-blind, placebo-controlled trial to evaluate the safety and

efficacy of ANAVEX ® 2-73 in 33 adult patients over a 7-week treatment period including ANAVEX ® 2-73

specific precision medicine biomarkers.

Based upon the input from the successful U.S.

Phase 2 Rett syndrome trial (ANAVEX ® 2-73-RS-001),

we updated the endpoints for the AVATAR trial (ANAVEX ® 2-73-RS-002) to appropriately assess the clinically meaningful

outcome following International Conference on Harmonization (ICH) guidelines.

These updates were approved by the respective regulatory

authorities in the U.K.

and in Australia, respectively, where the AVATAR trial was conducted.

The data from the AVATAR trial was released

in February 2022.

The clinical trial met all primary and secondary efficacy and safety endpoints, with consistent improvements

in primary efficacy endpoint, RSBQ response (p = 0.037), and secondary efficacy endpoints, ADAMS (p = 0.010) and CGI-I (p = 0.037)

Efficacy endpoints demonstrated statistically significant and clinically meaningful reductions in Rett syndrome symptoms.

Convenient once daily oral liquid doses of up to 30 mg of ANAVEX ® 2-73 were also well tolerated with good medication

All patients who participated in the trial were eligible to receive ANAVEX ® 2-73 under a voluntary open

label extension protocol.

In July 2020, we commenced the third trial

of ANAVEX ® 2-73 for the treatment of Rett syndrome, called the EXCELLENCE trial.

This Phase 2/3 trial in pediatric

patients with Rett syndrome includes trial sites in Australia, the United Kingdom and Canada, and will evaluate the safety and

efficacy of ANAVEX ® 2-73 in approximately 84 pediatric patients, aged 5 to 18, over a 12-week treatment period incorporating

ANAVEX ® 2-73 specific precision medicine biomarkers.

This trial completed enrollment in February 2023, exceeding

the original enrollment target and topline results are expected in the second half of 2023.

All patients who participate in the

trial will be eligible to receive ANAVEX ® 2-73 under a voluntary open label extension protocol, which is currently

Parkinson’s Disease

In September 2016, we presented positive preclinical

data for ANAVEX ® 2-73 in an animal model of Parkinson’s disease, which demonstrated significant improvements on behavioral,

histopathological, and neuroinflammatory endpoints.

data for ANAVEX ® 2-73 in an animal model of Parkinson’s disease, which demonstrated significant improvements

on behavioral, histopathological, and neuroinflammatory endpoints.

The study was funded by the Michael J.

Fox Foundation.

Additional data announced in

October 2017 indicated that ANAVEX ® 2-73 induced robust neurorestoration in experimental Parkinsonism.

We believe the encouraging

results we have gathered in this preclinical model, coupled with the favorable profile of this product candidate in the Alzheimer’s

disease trial, support the notion that ANAVEX ® 2-73 has the potential to treat Parkinson’s disease dementia.

In October 2020, we completed a double-blind, randomized,

placebo-controlled proof-of-concept Phase 2 trial with ANAVEX ® 2-73 in Parkinson’s disease dementia in Spain and Australia,

to study the effect of the compound on both the cognitive and motor impairment of Parkinson’s disease.

The Phase 2 trial enrolled

approximately 132 patients for 14 weeks, randomized 1:1:1 to two different ANAVEX ® 2-73 doses, 30 mg and 50 mg, or placebo.

The ANAVEX ® 2-73 Phase 2 Parkinson’s disease dementia trial design incorporated genomic precision medicine biomarkers

identified in the ANAVEX ® 2-73 Phase 2a Alzheimer’s disease trial.

data announced in October 2017 indicated that ANAVEX ® 2-73 induced robust neurorestoration in experimental Parkinsonism.

We believe the encouraging results we have gathered in this preclinical model, coupled with the favorable profile of this product

candidate in the Alzheimer’s disease trial, support the notion that ANAVEX ® 2-73 has the potential to treat

Parkinson’s disease dementia.

In October 2020, we completed a double-blind,

randomized, placebo-controlled proof-of-concept Phase 2 trial with ANAVEX ® 2-73 in Parkinson’s disease dementia

in Spain and Australia, to study the effect of the compound on both the cognitive and motor impairment of Parkinson’s disease.

The Phase 2 trial enrolled approximately 132 patients for 14 weeks, randomized 1:1:1 to two different ANAVEX ® 2-73

doses, 30 mg and 50 mg, or placebo.

The ANAVEX ® 2-73 Phase 2 Parkinson’s disease dementia trial design incorporated

genomic precision medicine biomarkers identified in the ANAVEX ® 2-73 Phase 2a Alzheimer’s disease trial.

The trial demonstrated that ANAVEX ® 2-73

was safe and well tolerated in oral doses up to 50 mg once daily.

The results showed clinically meaningful, dose-dependent, and statistically

significant improvements in the Cognitive Drug Research (“CDR”) computerized assessment system analysis.

Treatment with ANAVEX ® 2-73

also resulted in clinically meaningful improvements as measured by the global composite score of Parkinson’s disease symptom severity,

MDS-Unified Parkinson’s Disease Rating Scale total score on top of standard of care including dopaminergic therapy, levodopa and

other anti-PD medications after 14 weeks of treatment, suggesting ANAVEX ® 2-73’s potential capability of slowing and

reversing symptoms that progress in Parkinson’s disease.

In addition, the trial confirmed the precision medicine approach of targeting

SIGMAR1 as a genetic biomarker in response to ANAVEX ® 2-73 may result in improved clinical outcomes.

In January 2021, we were awarded a research grant

of $1.0 million from The Michael J.

Fox Foundation for Parkinson’s Research to develop ANAVEX ® 2-73 for

the treatment of Parkinson’s disease.

The award will explore utilization of PET imaging biomarkers to enable measurement of target

engagement and pathway activation of the SIGMAR1 with clinically relevant doses including in people with Parkinson’s disease.

The results showed clinically meaningful, dose-dependent, and

statistically significant improvements in the Cognitive Drug Research (“CDR”) computerized assessment system analysis.

Treatment with ANAVEX ® 2-73 also resulted in clinically meaningful improvements as measured by the global composite

score of Parkinson’s disease symptom severity, MDS-Unified Parkinson’s Disease Rating Scale (“MDS-UPDRS”)

total score on top of standard of care including dopaminergic therapy, levodopa and other anti-PD medications after 14 weeks of

treatment, suggesting ANAVEX ® 2-73’s potential capability of slowing and reversing symptoms that progress in

Parkinson’s disease.

In addition, the trial confirmed the precision medicine approach of targeting SIGMAR1 as a genetic biomarker

in response to ANAVEX ® 2-73 may result in improved clinical outcomes.

A 48-week Open Label Extension (“OLE”)

ANAVEX2-73-PDD-EP-001 Phase 2 trial was offered to participants after completion of the double-blind placebo-controlled ANAVEX2-73-PDD-001

Phase 2 trial discussed above.

The OLE trial assessed safety, tolerability and efficacy, measuring among others, MDS-Unified Parkinson’s

Disease Rating Scale Parts I, II, III, REM Sleep Behavior Disorder Screening Questionnaire (RBDSQ), Clinical Global Impression

– Improvement (CGI-I), as well as cognitive efficacy endpoint Montreal Cognitive Assessment (MoCA) over a 48-week period.

In March 2023, we reported the preliminary

ANAVEX2-73-PDD-EP-001 OLE trial data, which demonstrated longitudinal beneficial effects of ANAVEX ® 2-73 on the prespecified

primary and secondary objectives.

Preliminary analysis reveals that ANAVEX ® 2-73 (blarcamesine) was found to be generally

safe and well tolerated;

and safety findings in this trial were consistent with the known safety profile of ANAVEX ® 2-73.

In respect to efficacy, across all efficacy endpoints, patients performed better while on ANAVEX ® 2-73.

patients were on drug holiday due to COVID-19 between the DB EOT and the OLE Baseline, the respective efficacy endpoints, including

the MDS-UPDRS Part II + III and CGI-I, measured at the end of trial of the double-blind study (DB EOT) and the OLE Baseline, were

worsening, as expected in a progressive disease like Parkinson’s.

However, when patients resumed daily oral ANAVEX ® 2-73

treatment, a consistent improvement was observed during the extension phase from OLE Baseline through OLE Week 24, and OLE Week

48, respectively.

These results are consistent with the pattern observed for all efficacy measures in the extension phase.

two endpoints, MDS-UPDRS Part II + III and CGI-I measured in this study are the planned primary and key secondary endpoints in

our forthcoming pivotal 6-month Parkinson’s disease study.

In January 2021, we were awarded a research

grant of $1.0 million from The Michael J.

Fox Foundation for Parkinson’s Research to develop ANAVEX ® 2-73

for the treatment of Parkinson’s disease.

The award will explore utilization of PET imaging biomarkers to enable measurement

of target engagement and pathway activation of the SIGMAR1 with clinically relevant doses including in people with Parkinson’s

Frontotemporal Dementia

In July 2020, we commenced the First-in-Human Phase

1 clinical trial of ANAVEX ® 3-71.

ANAVEX ® 3-71 was previously granted orphan drug designation for the treatment

of Frontotemporal Dementia (“FTD”) by the FDA.

ANAVEX ® 3-71 is an orally administered small molecule targeting

sigma-1 and M1 muscarinic receptors that is designed to be beneficial for neurodegenerative diseases.

In preclinical studies, ANAVEX ® 3-71

demonstrated disease-modifying activity against the major hallmarks of Alzheimer’s disease in transgenic (3xTg-AD) mice, including

cognitive deficits, amyloid and tau pathologies, as well as beneficial effects on mitochondrial dysfunction and neuroinflammation.

In July 2020, we commenced the First-in-Human

Phase 1 clinical trial of ANAVEX ® 3-71.

ANAVEX ® 3-71 was previously granted orphan drug designation

for the treatment of Frontotemporal Dementia (“FTD”) by the FDA.

ANAVEX ® 3-71 is an orally administered

small molecule targeting sigma-1 and M1 muscarinic receptors that is designed to be beneficial for neurodegenerative diseases.

In preclinical studies, ANAVEX ® 3-71 demonstrated disease-modifying activity

against the major hallmarks of Alzheimer’s disease in transgenic (3xTg-AD) mice, including cognitive deficits, amyloid and

tau pathologies, as well as beneficial effects on mitochondrial dysfunction and neuroinflammation.

1 clinical trial was a prospective double-blind, randomized, placebo-controlled trial in Australia.

A total of 36 healthy male and female

subjects were included.

Single escalating doses of ANAVEX ® 3-71 were administered in order to evaluate the safety, tolerability,

and PK of ANAVEX ® 3-71 and the effects of food and gender on its PK in healthy volunteers.

The trial met

its primary and secondary endpoints of safety, with no serious adverse events (“SAEs”) or dose-limiting toxicities observed.

ANAVEX ® 3-71 was well tolerated in all cohorts receiving ANAVEX ® 3-71 in single doses ranging from 5 mg to

200 mg daily with no SAEs and no significant lab abnormalities in any subject.

In the trial, ANAVEX ® 3-71 exhibited linear

A total of 36 healthy male

and female subjects were included.

Single escalating doses of ANAVEX ® 3-71 were administered in order to evaluate

the safety, tolerability, and PK of ANAVEX ® 3-71 and the effects of food and gender on its PK in healthy volunteers.

met its primary and secondary endpoints of safety, with no serious adverse events (“SAEs”) or dose-limiting toxicities

ANAVEX ® 3-71 was well tolerated in all cohorts receiving ANAVEX ® 3-71 in single doses ranging

from 5 mg to 200 mg daily with no SAEs and no significant lab abnormalities in any subject.

In the trial, ANAVEX ® 3-71

exhibited linear PK.

Its pharmacokinetics was also dose proportional for doses up to 160 mg.

Gender had no effect on the PK of the drug and food had no

effect on the bioavailability of ANAVEX ® 3-71.

The trial also met the secondary objective of characterizing the effect of

ANAVEX ® 3-71 on electrocardiogram (“ECG”) parameters.

There were no clinically significant ECG parameters throughout

Participant QTcF measures were normal across all dose groups with no difference between ANAVEX ® 3-71 and placebo.

Based on these

results, and ANAVEX ® 3-71’s pre-clinical profile, we intend to advance ANAVEX ® 3-71 into a biomarker-driven

clinical development dementia program for the treatment of schizophrenia, FTD and Alzheimer’s disease, evaluating longitudinal effect

of treatment with ANAVEX ® 3-71.

We believe the results of these clinical trials and preclinical study could serve as a basis

for advancing into respective registration trials in the U.S.

Our research and development pipeline includes ANAVEX ® 2-73

currently in three different clinical trial indications, and several other compounds in different stages of clinical and pre-clinical

Our proprietary SIGMACEPTOR™ Discovery Platform

produced small molecule drug candidates with unique modes of action, based on our understanding of sigma receptors.

Sigma receptors may

be targets for therapeutics to combat many human diseases, both of neurodegenerative nature, including Alzheimer’s disease, as well

as of neurodevelopmental nature, like Rett syndrome.

When bound by the appropriate ligands, sigma receptors influence the functioning

of multiple biochemical signals that are involved in the pathogenesis (origin or development) of disease.

Multiple viruses including SARS-CoV-2

(COVID-19) induce cellular stress by intrinsic mitochondrial apoptosis and other related cellular processes, in order to ensure survival

and replication.

Hence, it is possible that SIGMAR1 could play a role in modulating the cellular response to viral infection and ameliorate

pathogenesis.

Gender had no effect on the PK of

the drug and food had no effect on the bioavailability of ANAVEX ® 3-71.

The trial also met the secondary objective

of characterizing the effect of ANAVEX ® 3-71 on electrocardiogram (“ECG”) parameters.

There were no clinically

significant ECG parameters throughout the trial.

Participant QTcF measures were normal across all dose groups with no difference

between ANAVEX ® 3-71 and placebo.

on these results, and ANAVEX ® 3-71’s pre-clinical profile, we intend to advance ANAVEX ® 3-71

into a biomarker-driven clinical development dementia program for the treatment of schizophrenia, FTD and Alzheimer’s disease,

evaluating longitudinal effect of treatment with ANAVEX ® 3-71.

We believe the results of these clinical trials and

preclinical study could serve as a basis for advancing into respective registration trials in the U.S.

Our research and development pipeline includes

ANAVEX ® 2-73 currently in three different clinical trial indications, and several other compounds in different stages

of clinical and pre-clinical development.

Our proprietary SIGMACEPTOR™ Discovery

Platform produced small molecule drug candidates with unique modes of action, based on our understanding of sigma receptors.

receptors may be targets for therapeutics to combat many human diseases, both of neurodegenerative nature, including Alzheimer’s

disease, as well as of neurodevelopmental nature, like Rett syndrome.

When bound by the appropriate ligands, sigma receptors influence

the functioning of multiple biochemical signals that are involved in the pathogenesis (origin or development) of disease.

viruses including SARS-CoV-2 (COVID-19) induce cellular stress by intrinsic mitochondrial apoptosis and other related cellular

processes, in order to ensure survival and replication.

Hence, it is possible that SIGMAR1 could play a role in modulating the

cellular response to viral infection and ameliorate pathogenesis.

Compounds that have been subjects of our research

1 unchanged sentence

ANAVEX ® 2-73 (blarcamesine)

We believe ANAVEX ® 2-73 may offer a

disease-modifying approach in neurodegenerative and neurodevelopmental diseases by activation of SIGMAR1.

ANAVEX ® 2-73 is

being developed in an oral liquid once-daily formulation for rare diseases such as Rett syndrome as well as an oral once-daily capsule

formulation for diseases such as Alzheimer’s disease.

We believe ANAVEX ® 2-73 may offer

a disease-modifying approach in neurodegenerative and neurodevelopmental diseases by activation of SIGMAR1.

ANAVEX ® 2-73

is being developed in an oral liquid once-daily formulation for rare diseases such as Rett syndrome as well as an oral once-daily

capsule formulation for diseases such as Alzheimer’s disease.

In Rett syndrome, administration of ANAVEX ® 2-73

in liquid form resulted in both significant and dose related improvements in an array of behavioral paradigms in the MECP2 HET Rett syndrome

disease model.

In addition, in a further experiment sponsored by Rettsyndrome.org, ANAVEX ® 2-73 was evaluated in automatic

visual response and respiration tests in 7-month old mice, an age at which advanced pathology is evident.

Vehicle-treated MECP2 mice demonstrated

fewer automatic visual responses than wild-type mice.

Treatment with ANAVEX ® 2-73 for four weeks significantly increased

the automatic visual response in the MECP2 Rett syndrome disease mice.

Additionally, chronic oral dosing daily for 6.5 weeks of ANAVEX ® 2-73

starting at ~5.5 weeks of age was conducted in the MECP2 HET Rett syndrome disease mouse model assessed the different aspects of muscular

coordination, balance, motor learning and muscular strengths, some of the core deficits observed in Rett syndrome.

Administration of ANAVEX ® 2-73

resulted in both significant and dose related improvements in an array of these behavioral paradigms in the MECP2 HET Rett syndrome disease

In May 2016 and June 2016, the FDA granted Orphan

Drug Designation to ANAVEX ® 2-73 for the treatment of Rett syndrome and infantile spasms, respectively.

In November 2019,

the FDA granted to ANAVEX ® 2-73 the Rare Pediatric Disease (RPD) designation for the treatment of Rett syndrome.

designation is intended to encourage the development of treatments for rare pediatric diseases.

Further, in February 2020, the FDA granted Fast Track

designation for the ANAVEX ® 2-73 clinical development program for the treatment of Rett syndrome.

The FDA Fast Track program

is designed to facilitate and expedite the development and review of new drugs to address unmet medical needs in the treatment of serious

and life-threatening conditions.

For Parkinson’s disease, data demonstrates significant

improvements and restoration of function in a disease modifying animal model of Parkinson’s disease.

Significant improvements were

seen on all measures tested:

in liquid form resulted in both significant and dose related improvements in an array of behavioral paradigms in the MECP2 HET

Rett syndrome disease model.

In addition, in a further experiment sponsored by Rettsyndrome.org, ANAVEX ® 2-73 was

evaluated in automatic visual response and respiration tests in 7-month old mice, an age at which advanced pathology is evident.

Vehicle-treated MECP2 mice demonstrated fewer automatic visual responses than wild-type mice.

Treatment with ANAVEX ® 2-73

for four weeks significantly increased the automatic visual response in the MECP2 Rett syndrome disease mice.

Additionally, chronic

oral dosing daily for 6.5 weeks of ANAVEX ® 2-73 starting at ~5.5 weeks of age was conducted in the MECP2 HET Rett

syndrome disease mouse model assessed the different aspects of muscular coordination, balance, motor learning and muscular strengths,

some of the core deficits observed in Rett syndrome.

Administration of ANAVEX ® 2-73 resulted in both significant

and dose related improvements in an array of these behavioral paradigms in the MECP2 HET Rett syndrome disease model.

In May 2016 and June 2016, the FDA granted

Orphan Drug Designation to ANAVEX ® 2-73 for the treatment of Rett syndrome and infantile spasms, respectively.

November 2019, the FDA granted to ANAVEX ® 2-73 the Rare Pediatric Disease (RPD) designation for the treatment of

Rett syndrome.

The RPD designation is intended to encourage the development of treatments for rare pediatric diseases.

Further, in February 2020, the FDA granted

Fast Track designation for the ANAVEX ® 2-73 clinical development program for the treatment of Rett syndrome.

FDA Fast Track program is designed to facilitate and expedite the development and review of new drugs to address unmet medical

needs in the treatment of serious and life-threatening conditions.

For Parkinson’s disease, data demonstrates

significant improvements and restoration of function in a disease modifying animal model of Parkinson’s disease.

improvements were seen on all measures tested:

behavioral, histopathological, and neuroinflammatory endpoints.

In October 2020, we completed a double-blind,

randomized, placebo-controlled proof-of-concept Phase 2 trial with ANAVEX ® 2-73 in Parkinson’s disease dementia, to

study the effect of the compound on both the cognitive and motor impairment of Parkinson’s disease.

The Phase 2 trial enrolled approximately

132 patients for 14 weeks, randomized 1:1:1 to two different ANAVEX ® 2-73 doses, 30mg and 50mg, or placebo.

The ANAVEX ® 2-73

Phase 2 Parkinson’s disease dementia trial design incorporated genomic precision medicine biomarkers identified in the ANAVEX ® 2-73

Phase 2a Alzheimer’s disease trial.

In October 2020,

we completed a double-blind, randomized, placebo-controlled proof-of-concept Phase 2 trial with ANAVEX ® 2-73 in Parkinson’s

disease dementia, to study the effect of the compound on both the cognitive and motor impairment of Parkinson’s disease.

The Phase 2 trial enrolled approximately 132 patients for 14 weeks, randomized 1:1:1 to two different ANAVEX ® 2-73

doses, 30mg and 50mg, or placebo.

The ANAVEX ® 2-73 Phase 2 Parkinson’s disease dementia trial design incorporated

genomic precision medicine biomarkers identified in the ANAVEX ® 2-73 Phase 2a Alzheimer’s disease trial.

The trial demonstrated that ANAVEX ® 2-73

was safe and well tolerated in oral doses up to 50mg once daily.

The results showed clinically meaningful, dose-dependent, and statistically

significant improvements in the CDR computerized assessment system analysis.

We anticipate conducting further clinical trials of ANAVEX ® 2-73

in Parkinson’s disease dementia after submitting the results of the trial to the FDA to obtain regulatory guidance.

In Alzheimer’s disease animal models, ANAVEX ® 2-73

has shown pharmacological, histological and behavioral evidence as a potential neuroprotective, anti-amnesic, anti-convulsive and anti-depressive

therapeutic agent, due to its potent affinity to SIGMAR1 and moderate affinities to M1-4 type muscarinic receptors.

In addition, ANAVEX ® 2-73

has shown a potential dual mechanism which may impact amyloid, tau pathology and inflammation.

In a transgenic Alzheimer’s disease

animal model Tg2576, ANAVEX ® 2-73 induced a statistically significant neuroprotective effect against the development of

oxidative stress in the mouse brain, as well as significantly increased the expression of functional and synaptic plasticity markers that

is apparently amyloid-beta independent.

It also statistically alleviated the learning and memory deficits developed over time in the animals,

regardless of sex, both in terms of spatial working memory and long-term spatial reference memory.

Based on the results of pre-clinical testing, we initiated

and completed a Phase 1 single ascending dose (SAD) clinical trial of ANAVEX ® 2-73.

In this Phase 1 SAD trial, the maximum

tolerated single dose was defined per protocol as 55-60 mg.

This dose is above the equivalent dose shown to have positive effects in mouse

models of Alzheimer’s disease.

The results showed clinically meaningful, dose-dependent, and

statistically significant improvements in the CDR computerized assessment system analysis.

We anticipate conducting further clinical

trials of ANAVEX ® 2-73 in Parkinson’s disease dementia after submitting the results of the trial to the FDA

to obtain regulatory guidance.

In Alzheimer’s disease animal models,

ANAVEX ® 2-73 has shown pharmacological, histological and behavioral evidence as a potential neuroprotective, anti-amnesic,

anti-convulsive and anti-depressive therapeutic agent, due to its potent affinity to SIGMAR1 and moderate affinities to M1-4 type

muscarinic receptors.

In addition, ANAVEX ® 2-73 has shown a potential dual mechanism which may impact amyloid, tau

pathology and inflammation.

In a transgenic Alzheimer’s disease animal model Tg2576, ANAVEX ® 2-73 induced a

statistically significant neuroprotective effect against the development of oxidative stress in the mouse brain, as well as significantly

increased the expression of functional and synaptic plasticity markers that is apparently amyloid-beta independent.

It also statistically

alleviated the learning and memory deficits developed over time in the animals, regardless of sex, both in terms of spatial working

memory and long-term spatial reference memory.

Based on the results of pre-clinical testing,

we initiated and completed a Phase 1 single ascending dose (SAD) clinical trial of ANAVEX ® 2-73.

In this Phase 1

SAD trial, the maximum tolerated single dose was defined per protocol as 55-60 mg.

This dose is above the equivalent dose shown

to have positive effects in mouse models of Alzheimer’s disease.

There were no significant changes in laboratory or ECG parameters.

ANAVEX ® 2-73 was

well tolerated below the 55-60 mg dose with only mild adverse events in some subjects.

Observed adverse events at doses above the maximum

tolerated single dose included headache and dizziness, which were moderate in severity and reversible.

These side effects are often seen

with drugs that target CNS conditions, including Alzheimer’s disease.

ANAVEX ® 2-73 was well tolerated below the 55-60 mg dose with only mild adverse events in some subjects.

adverse events at doses above the maximum tolerated single dose included headache and dizziness, which were moderate in severity

and reversible.

These side effects are often seen with drugs that target CNS conditions, including Alzheimer’s disease.

In November 2016, we completed a Phase 2a clinical

trial for ANAVEX ® 2-73, for the treatment of Alzheimer’s disease.

The open-label randomized trial was designed to

assess the safety and exploratory efficacy of ANAVEX ® 2-73 in 32 patients with mild-to-moderate Alzheimer’s disease.

The open-label randomized trial was designed

to assess the safety and exploratory efficacy of ANAVEX ® 2-73 in 32 patients with mild-to-moderate Alzheimer’s

The Phase 2a trial met both primary and secondary objectives of the trial.

1 unchanged sentence

the results of a genomic DNA and RNA evaluation of the participants in the Phase 2a clinical trial.

More than 33,000 genes were analyzed

using unbiased, data driven, machine learning, artificial intelligence (AI) system for analyzing DNA and RNA data in patients treated

with ANAVEX ® 2-73.

The analysis identified genetic variants that impacted response to ANAVEX ® 2-73, among

them variants related to the SIGMAR1, the target for ANAVEX ® 2-73.

Results showed that trial participants with the common

SIGMAR1 wild type gene variant, which is estimated to be about 80% of the population worldwide, demonstrated improved cognitive (MMSE)

and the functional (ADCS-ADL) scores.

The results from this evaluation supported the continued evaluation of genomic information in subsequent

clinical trials, since these signatures can now be applied to neurological indications tested in future clinical trials with ANAVEX ® 2-73

including Alzheimer’s disease, Parkinson’s disease dementia and Rett syndrome.

More than 33,000 genes were

analyzed using unbiased, data driven, machine learning, artificial intelligence (AI) system for analyzing DNA and RNA data in patients

treated with ANAVEX ® 2-73.

The analysis identified genetic variants that impacted response to ANAVEX ® 2-73,

among them variants related to the SIGMAR1, the target for ANAVEX ® 2-73.

Results showed that trial participants with

the common SIGMAR1 wild type gene variant, which is estimated to be about 80% of the population worldwide, demonstrated improved

cognitive (MMSE) and functional (ADCS-ADL) scores.

The results from this evaluation supported the continued evaluation of genomic

information in subsequent clinical trials, since these signatures can now be applied to neurological indications tested in future

clinical trials with ANAVEX ® 2-73 including Alzheimer’s disease, Parkinson’s disease dementia and Rett

ANAVEX ® 2-73

1 unchanged sentence

On July 2, 2018, the Human Research

Ethics Committee in Australia approved the initiation of our Phase 2b/3, double-blind, randomized, placebo-controlled 48-week safety and

efficacy trial of ANAVEX ® 2-73 for the treatment of early Alzheimer’s disease.

Clinical trial sites in Canada, the

United Kingdom, the Netherlands and Germany were also added.

This Phase 2b/3 trial design incorporates inclusion of genomic precision

medicine biomarkers identified in the ANAVEX ® 2-73 Phase 2a trial.

The trial completed and, in December 2022, the Company

presented positive topline results from the Phase 2b/3 clinical trial.

ANAVEX ® 2-73 met the co-primary endpoints ADAS-Cog

and ADCS-ADL and key secondary endpoint CDR-SB as further described above under Clinical Trials Overview – Alzheimer’s

We believe preclinical data from our studies also

supports further research into the use of ANAVEX ® 2-73 as a potential platform drug for other neurodegenerative diseases

beyond Alzheimer’s disease, Parkinson’s disease or Rett syndrome, more specifically, epilepsy, infantile spasms, Fragile X

syndrome, Angelman syndrome, multiple sclerosis, and, more recently, tuberous sclerosis complex (TSC).

ANAVEX ® 2-73 demonstrated

significant improvements in all of these indications in the respective preclinical animal models.

Ethics Committee in Australia approved the initiation of our Phase 2b/3, double-blind, randomized, placebo-controlled 48-week safety

and efficacy trial of ANAVEX ® 2-73 for the treatment of early Alzheimer’s disease.

Clinical trial sites in

Canada, the United Kingdom, the Netherlands and Germany were also added.

This Phase 2b/3 trial design incorporates inclusion of

genomic precision medicine biomarkers identified in the ANAVEX ® 2-73 Phase 2a trial.

The trial completed and, in December 2022,

the Company presented positive topline results from the Phase 2b/3 clinical trial.

ANAVEX ® 2-73 met the co-primary

endpoints ADAS-Cog and ADCS-ADL and key secondary endpoint CDR-SB as further described above under Clinical Trials Overview

– Alzheimer’s Disease.

We believe preclinical data from our studies

also supports further research into the use of ANAVEX ® 2-73 as a potential platform drug for other neurodegenerative

diseases beyond Alzheimer’s disease, Parkinson’s disease or Rett syndrome, more specifically, epilepsy, infantile spasms,

Fragile X syndrome, Angelman syndrome, multiple sclerosis, and, more recently, tuberous sclerosis complex (TSC).

ANAVEX ® 2-73

demonstrated significant improvements in all of these indications in the respective preclinical animal models.

In a preclinical study sponsored by the Foundation

for Angelman Syndrome, ANAVEX ® 2-73 was assessed in a mouse model for the development of audiogenic seizures.

indicated that ANAVEX ® 2-73 administration significantly reduced audiogenic-induced seizures in mice.

In a study sponsored

by FRAXA Research Foundation regarding Fragile X syndrome, data demonstrated that ANAVEX ® 2-73 restored hippocampal brain-derived

neurotrophic factor (BDNF) expression to normal levels.

BDNF under-expression has been observed in many neurodevelopmental and neurodegenerative

BDNF signaling promotes maturation of both excitatory and inhibitory synapses.

ANAVEX ® 2-73 normalization of

BDNF expression could be a contributing factor for the positive preclinical data observed in both neurodevelopmental and neurodegenerative

disorders like Angelman and Fragile X syndromes.

In addition, preclinical data to-date also indicates

that ANAVEX ® 2-73 has the potential to demonstrate protective effects of mitochondrial enzyme complexes during pathological

conditions, which, if impaired, may play a role in the pathogenesis of neurodegenerative and neurodevelopmental diseases.

results indicated that ANAVEX ® 2-73 administration significantly reduced audiogenic-induced seizures in mice.

a study sponsored by FRAXA Research Foundation regarding Fragile X syndrome, data demonstrated that ANAVEX ® 2-73

restored hippocampal brain-derived neurotrophic factor (BDNF) expression to normal levels.

BDNF under-expression has been observed

in many neurodevelopmental and neurodegenerative pathologies.

BDNF signaling promotes maturation of both excitatory and inhibitory

ANAVEX ® 2-73 normalization of BDNF expression could be a contributing factor for the positive preclinical

data observed in both neurodevelopmental and neurodegenerative disorders like Angelman and Fragile X syndromes.

In addition, preclinical data to-date also

indicates that ANAVEX ® 2-73 has the potential to demonstrate protective effects of mitochondrial enzyme complexes

during pathological conditions, which, if impaired, may play a role in the pathogenesis of neurodegenerative and neurodevelopmental

In addition, preclinical data on ANAVEX ® 2-73

related to multiple sclerosis indicates that ANAVEX ® 2-73 may promote remyelination in multiple sclerosis disease.

our data also demonstrates that ANAVEX ® 2-73 has the potential to provide protection for oligodendrocytes (“OL’s”)

and oligodendrocyte precursor cells (“OPC’s”), as well as central nervous system neurons in addition to helping repair

by increasing OPC proliferation and maturation in tissue culture.

In March 2018, we presented preclinical data of ANAVEX ® 2-73

in a genetic mouse model of tuberous sclerosis complex (“TSC”).

TSC is a rare genetic disorder characterized by the growth

of numerous benign tumors in many parts of the body with a high incidence of seizures.

The preclinical data demonstrated that treatment

with ANAVEX ® 2-73 significantly increased survival and reduced seizures in those mice.

Further, our data also demonstrates that ANAVEX ® 2-73 has the potential to provide protection for oligodendrocytes

(“OL’s”) and oligodendrocyte precursor cells (“OPC’s”), as well as central nervous system neurons

in addition to helping repair by increasing OPC proliferation and maturation in tissue culture.

In March 2018, we presented preclinical data

of ANAVEX ® 2-73 in a genetic mouse model of tuberous sclerosis complex (“TSC”).

TSC is a rare genetic

disorder characterized by the growth of numerous benign tumors in many parts of the body with a high incidence of seizures.

preclinical data demonstrated that treatment with ANAVEX ® 2-73 significantly increased survival and reduced seizures

in those mice.

ANAVEX ® 3-71

ANAVEX ® 3-71 is a clinical drug candidate

with a novel mechanism of action via SIGMAR1 activation and M1 muscarinic allosteric modulation, which has been shown to enhance neuroprotection

and cognition in Alzheimer’s disease models.

ANAVEX ® 3-71 is a CNS-penetrable potential disease modifying treatment

for cognitive impairments.

We believe it is effective in very small doses against the major Alzheimer’s hallmarks in transgenic

(3xTg-AD) mice, including cognitive deficits, amyloid and tau pathologies, and also has beneficial effects on inflammation and mitochondrial

dysfunctions.

ANAVEX ® 3-71 indicates extensive therapeutic advantages in Alzheimer’s and other protein-aggregation-related

diseases given its ability to enhance neuroprotection and cognition via SIGMAR1 activation and M1 muscarinic allosteric modulation.

A preclinical study examined the response of ANAVEX ® 3-71

in aged transgenic animal models and showed a significant reduction in the rate of cognitive deficit, amyloid beta pathology and inflammation

with the administration of ANAVEX ® 3-71.

In April 2016, the FDA granted Orphan Drug Designation to ANAVEX ® 3-71

for the treatment of FTD.

ANAVEX ® 3-71 is a clinical drug

candidate with a novel mechanism of action via SIGMAR1 activation and M1 muscarinic allosteric modulation, which has been shown

to enhance neuroprotection and cognition in Alzheimer’s disease models.

ANAVEX ® 3-71 is a CNS-penetrable potential

disease modifying treatment for cognitive impairments.

We believe it is effective in very small doses against the major Alzheimer’s

hallmarks in transgenic (3xTg-AD) mice, including cognitive deficits, amyloid and tau pathologies, and also has beneficial effects

on inflammation and mitochondrial dysfunctions.

ANAVEX ® 3-71 indicates extensive therapeutic advantages in Alzheimer’s

and other protein-aggregation-related diseases given its ability to enhance neuroprotection and cognition via SIGMAR1 activation

and M1 muscarinic allosteric modulation.

A preclinical study examined the response of

ANAVEX ® 3-71 in aged transgenic animal models and showed a significant reduction in the rate of cognitive deficit,

amyloid beta pathology and inflammation with the administration of ANAVEX ® 3-71.

In April 2016, the FDA granted Orphan

Drug Designation to ANAVEX ® 3-71 for the treatment of FTD.

During pathological conditions ANAVEX ® 3-71

demonstrated the formation of new synapses between neurons (synaptogenesis) without causing an abnormal increase in the number of astrocytes.

In neurodegenerative diseases such as Alzheimer’s and Parkinson’s disease, synaptogenesis is believed to be impaired.

preclinical data presented also indicates that in addition to reducing oxidative stress, ANAVEX ® 3-71 has the potential

to demonstrate protective effects of mitochondrial enzyme complexes during pathological conditions, which, if impaired, are believed to

play a role in the pathogenesis of neurodegenerative and neurodevelopmental diseases.

In July 2020, we commenced the first Phase 1 clinical

trial of ANAVEX ® 3-71.

The trial took place in Australia and was a double-blind, randomized, placebo-controlled, Phase

1 trial to evaluate safety and tolerability, and PK of oral escalating doses of ANAVEX ® 3-71

demonstrated the formation of new synapses between neurons (synaptogenesis) without causing an abnormal increase in the number

of astrocytes.

In neurodegenerative diseases such as Alzheimer’s and Parkinson’s disease, synaptogenesis is believed

to be impaired.

Additional preclinical data presented also indicates that in addition to reducing oxidative stress, ANAVEX ® 3-71

has the potential to demonstrate protective effects of mitochondrial enzyme complexes during pathological conditions, which, if

impaired, are believed to play a role in the pathogenesis of neurodegenerative and neurodevelopmental diseases.

In July 2020, we commenced the first Phase

1 clinical trial of ANAVEX ® 3-71.

The trial took place in Australia and was a double-blind, randomized, placebo-controlled,

Phase 1 trial to evaluate safety and tolerability, and PK of oral escalating doses of ANAVEX ® 3-71

including effects of food and gender in healthy volunteers.

The trial met its primary and secondary

endpoints of safety, respectively, with no serious adverse events (SAEs) or dose-limiting toxicities observed, as more fully described

above under Clinical Trials Overview – Frontotemporal Dementia .

Based on these

results, and ANAVEX ® 3-71 pre-clinical profile, the Company intends to advance ANAVEX ® 3-71 into a biomarker-driven

clinical development dementia program for the treatment of schizophrenia, FTD and Alzheimer’s disease, evaluating longitudinal effect

of treatment with ANAVEX ® 3-71.

We believe the results of this clinical trial and preclinical study could serve as a basis

for advancing into respective registration trials in the U.S.

The trial met its primary and

secondary endpoints of safety, respectively, with no serious adverse events (SAEs) or dose-limiting toxicities observed, as

more fully described above under Clinical Trials Overview – Frontotemporal Dementia .

on these results, and ANAVEX ® 3-71 pre-clinical profile, the Company intends to advance ANAVEX ® 3-71

into a biomarker-driven clinical development dementia program for the treatment of schizophrenia, FTD and Alzheimer’s disease,

evaluating longitudinal effect of treatment with ANAVEX ® 3-71.

We believe the results of this clinical trial and

preclinical study could serve as a basis for advancing into respective registration trials in the U.S.

ANAVEX ® 1-41

ANAVEX ® 1-41 is a sigma-1 agonist.

tests revealed significant neuroprotective benefits (i.e., protects nerve cells from degeneration or death) through the modulation of

endoplasmic reticulum, mitochondrial and oxidative stress, which damages and impairs cell viability.

In addition, in animal models, ANAVEX ® 1-41

prevented the expression of caspase-3, an enzyme that plays a key role in apoptosis (programmed cell death) and loss of cells in the hippocampus,

the part of the brain that regulates learning, emotion and memory.

These activities involve both muscarinic and SIGMAR1 systems through

a novel mechanism of action.

Preclinical data presented also indicates that ANAVEX ® 1-41

has the potential to demonstrate protective effects of mitochondrial enzyme complexes during pathological conditions, which, if impaired,

are believed to play a role in the pathogenesis of neurodegenerative and neurodevelopmental diseases.

Pre-clinical tests revealed significant neuroprotective benefits (i.e., protects nerve cells from degeneration or death) through

the modulation of endoplasmic reticulum, mitochondrial and oxidative stress, which damages and impairs cell viability.

in animal models, ANAVEX ® 1-41 prevented the expression of caspase-3, an enzyme that plays a key role in apoptosis

(programmed cell death) and loss of cells in the hippocampus, the part of the brain that regulates learning, emotion and memory.

These activities involve both muscarinic and SIGMAR1 systems through a novel mechanism of action.

Preclinical data presented also indicates that

ANAVEX ® 1-41 has the potential to demonstrate protective effects of mitochondrial enzyme complexes during pathological

conditions, which, if impaired, are believed to play a role in the pathogenesis of neurodegenerative and neurodevelopmental diseases.

ANAVEX ® 1066

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ligand, is designed for the potential treatment of neuropathic and visceral pain.

ANAVEX ® 1066 was tested in two preclinical

models of neuropathic and visceral pain that have been extensively validated in rats.

In the chronic constriction injury model of neuropathic

pain, a single oral administration of ANAVEX ® 1066 dose-dependently restored the nociceptive threshold in the affected paw

to normal levels while leaving the contralateral healthy paw unchanged.

Efficacy was rapid and remained significant for two hours.

a model of visceral pain, chronic colonic hypersensitivity was induced by injection of an inflammatory agent directly into the colon and

a single oral administration of ANAVEX ® 1066 returned the nociceptive threshold to control levels in a dose-dependent manner.

Companion studies in rats demonstrated the lack of any effects on normal gastrointestinal transit with ANAVEX ® 1066 and

a favorable safety profile in a battery of behavioral measures.

ANAVEX ® 1066 was tested in two

preclinical models of neuropathic and visceral pain that have been extensively validated in rats.

In the chronic constriction injury

model of neuropathic pain, a single oral administration of ANAVEX ® 1066 dose-dependently restored the nociceptive

threshold in the affected paw to normal levels while leaving the contralateral healthy paw unchanged.

Efficacy was rapid and remained

significant for two hours.

In a model of visceral pain, chronic colonic hypersensitivity was induced by injection of an inflammatory

agent directly into the colon and a single oral administration of ANAVEX ® 1066 returned the nociceptive threshold

to control levels in a dose-dependent manner.

Companion studies in rats demonstrated the lack of any effects on normal gastrointestinal

transit with ANAVEX ® 1066 and a favorable safety profile in a battery of behavioral measures.

ANAVEX ® 1037

ANAVEX ® 1037 is designed for the treatment

of prostate and pancreatic cancer.

It is a low molecular weight, synthetic compound exhibiting high affinity for SIGMAR1 at nanomolar

levels and moderate affinity for sigma-2 receptors and sodium channels at micromolar levels.

In advanced pre-clinical studies, this compound

revealed antitumor potential.

It has also been shown to selectively kill human cancer cells without affecting normal/healthy cells and

also to significantly suppress tumor growth in immune-deficient mice models.

Scientific publications highlight the possibility that these

ligands may stop tumor growth and induce selective cell death in various tumor cell lines.

Sigma receptors are highly expressed in different

tumor cell types.

Binding by appropriate sigma-1 and/or sigma-2 ligands can induce selective apoptosis.

In addition, through tumor cell

membrane reorganization and interactions with ion channels, we believe our drug candidates may play an important role in inhibiting the

processes of metastasis (spreading of cancer cells from the original site to other parts of the body), angiogenesis (the formation of

new blood vessels) and tumor cell proliferation.

ANAVEX ® 1037 is currently in the pre-clinical

and clinical testing stages of development, and there is no guarantee that the activity demonstrated in pre-clinical models will be shown

in human testing.

We continue to identify and initiate discussions with

potential strategic and commercial partners to most effectively advance our programs and increase stockholder value.

Further, we may acquire

or develop new intellectual property and assign, license, or otherwise transfer our intellectual property to further our goals.

ANAVEX ® 1037 is designed for

the treatment of prostate and pancreatic cancer.

It is a low molecular weight, synthetic compound exhibiting high affinity for

SIGMAR1 at nanomolar levels and moderate affinity for sigma-2 receptors and sodium channels at micromolar levels.

In advanced pre-clinical

studies, this compound revealed antitumor potential.

It has also been shown to selectively kill human cancer cells without affecting

normal/healthy cells and also to significantly suppress tumor growth in immune-deficient mice models.

Scientific publications highlight

the possibility that these ligands may stop tumor growth and induce selective cell death in various tumor cell lines.

Sigma receptors

are highly expressed in different tumor cell types.

Binding by appropriate sigma-1 and/or sigma-2 ligands can induce selective

In addition, through tumor cell membrane reorganization and interactions with ion channels, we believe our drug candidates

may play an important role in inhibiting the processes of metastasis (spreading of cancer cells from the original site to other

parts of the body), angiogenesis (the formation of new blood vessels) and tumor cell proliferation.

ANAVEX ® 1037 is currently in

the pre-clinical and clinical testing stages of development, and there is no guarantee that the activity demonstrated in pre-clinical

models will be shown in human testing.

We continue to identify and initiate discussions

with potential strategic and commercial partners to most effectively advance our programs and increase stockholder value.

we may acquire or develop new intellectual property and assign, license, or otherwise transfer our intellectual property to further

Our Target Indications

We are developing compounds with potential application

to two broad categories and several specific indications, including:

We are developing compounds with potential

application to two broad categories and several specific indications, including:

Central Nervous System Diseases

Alzheimer’s disease – In 2022, an estimated 6.5 million Americans were suffering from Alzheimer’s disease.

The Alzheimer’s Association ® estimates that by 2050, this number is expected to rise to 12.7 million Americans.

Alzheimer’s disease – In 2023, an estimated 6.7 million Americans age 65 and older are suffering from Alzheimer’s disease.

The Alzheimer’s Association ® estimates that the annual number of new cases of Alzheimer’s and other dementias is projected to double by 2050.

Medications on the market today treat only the symptoms of Alzheimer’s disease and do not have the ability to stop its onset or its progression.

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The Parkinson’s disease market is expected to reach $11.5 billion by 2029, according to GlobalData.

Rett syndrome – Rett syndrome is a rare X-linked genetic neurological and developmental disorder that affects the way the brain develops, including protein transcription, which is altered and as a result leads to severe disruptions in neuronal homeostasis.

It is considered a rare, progressive neurodevelopmental disorder and is caused by a single mutation in the MECP2 gene.

Because males have a different chromosome combination from females, boys who have the genetic MECP2 mutation are affected in devastating ways.

Rett syndrome – Rett syndrome is a rare

X-linked genetic neurological and developmental disorder that affects the way the brain develops, including protein transcription,

which is altered and as a result leads to severe disruptions in neuronal homeostasis.

It is considered a rare, progressive neurodevelopmental

disorder and is caused by a single mutation in the MECP2 gene.

Because males have a different chromosome combination from females,

boys who have the genetic MECP2 mutation are affected in devastating ways.

Most of them die before birth or in early infancy.

For females who survive infancy, Rett syndrome leads to severe impairments, affecting nearly every aspect of the child’s life;

females who survive infancy, Rett syndrome leads to severe impairments, affecting nearly every aspect of the child’s life;

severe mental retardation, their ability to speak, walk and eat, sleeping problems, seizures and even the ability to breathe easily.

Rett syndrome affects approximately 1 in every 10,000-15,000 females.

· Fragile X – Fragile X syndrome (FXS) is the most prevalent genetic form of intellectual disability

and autism spectrum disorder, primarily affecting boys.

As with most neurodevelopmental disorders, FXS is considered a condition

of synaptic development and function.

The disease has a range of clinical presentations depending on the specific genetic changes

associated with an “expansion” of the FMR1 gene.

The disease is characterized by deficits in long-term potentiation

and homeostatic plasticity.

FXS has been detected in all populations and ethnic groups.

Researchers do not know the exact number

for how many Americans could have full mutation FXS.

Studies estimate that the disease affects approximately 1:4,000 males and

1:6,000-8,000 females.

Worldwide, more than 1,400,000 people could be affected by FXS.

Depression – Depression is a major cause of morbidity worldwide according to the World Health Organization.

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Sales predictions by Market Data Forecast predict that the market for the global pharmaceutical treatment of pancreatic cancer will increase to $3.73 billion by 2027.

Patents, Trademarks and Intellectual Property

We hold ownership or exclusive rights to seventeen

patents, nineteen U.S.

Patents, Trademarks and Intellectual

We hold ownership or exclusive rights to eighteen

patents, twenty-one U.S.

patent applications, and various PCT or ex-U.S.

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is expected to expire in June 2034, absent any patent term extension for regulatory delays.

We own one issued U.S.

patent entitled “A2-73

crystalline polymorph compositions of matter and methods of use thereof”.

It claims crystals of A2-73 freebase or its fumarate salt,

dosage forms and pharmaceutical formulations.

This patent is expected to expire in July 2039, absent any patent term extension for regulatory

We own three issued U.S.

patents each with

claims directed to crystalline forms of ANAVEX ® 2-73.

The first of these three patents claims crystalline forms of ANAVEX ® 2-73,

dosage forms and compositions containing crystalline ANAVEX ® 2-73, and methods of treatment for Alzheimer’s disease

This patent is expected to expire in July 2036, absent any patent term extension for regulatory delays.

The second of these

three patents claims pharmaceutical compositions containing a crystalline form of ANAVEX ® 2-73, and methods of treatment

for Alzheimer’s disease using the compositions.

This patent is expected to expire in June 2037, absent any patent term extension

for regulatory delays.

The third of these three patents claims pharmaceutical compositions containing a crystalline form of ANAVEX ® 2-73,

and methods of treatment for Alzheimer’s disease using the compositions.

This patent is expected to expire in June 2037, absent

any patent term extension for regulatory delays.

patents each with claims directed to crystalline forms of ANAVEX ® 2-73.

The first of these

three patents claims crystalline forms of ANAVEX ® 2-73, dosage forms and compositions containing crystalline ANAVEX ® 2-73,

and methods of treatment for Alzheimer’s disease using them.

This patent is expected to expire in July 2036, absent any patent term

extension for regulatory delays.

The second of these three patents claims pharmaceutical compositions containing a crystalline form of

ANAVEX ® 2-73, and methods of treatment for Alzheimer’s disease using the compositions.

This patent is expected to

expire in June 2037, absent any patent term extension for regulatory delays.

The third of these three patents claims pharmaceutical compositions

containing a crystalline form of ANAVEX ® 2-73, and methods of treatment for Alzheimer’s disease using the compositions.

This patent is expected to expire in June 2037, absent any patent term extension for regulatory delays.

We also own two issued U.S.

patents for seizure treatment.

The first of these two patents

claims methods and dosage forms for treating seizures, the dosage forms containing a low-dose anti-epilepsy drug combined with either:

for seizure treatment.

The first of these two patents claims methods and dosage forms for treating seizures, the dosage forms containing

a low-dose anti-epilepsy drug combined with either:

(i) ANAVEX ® 2-73 and its active metabolite ANAVEX ® 19-144;

or (ii) ANAVEX ® 19-144.

of these two patents further claims a combination seizure treatment involving administration of an anti-epilepsy drug combined with (i)

ANAVEX ® 19-144, or (ii) ANAVEX 19-144 ® and ANAVEX 2-73 ® .

Both patents are expected to expire

in October 2035, absent any patent term extension for regulatory delays.

The second of these two patents further claims a combination seizure treatment involving

administration of an anti-epilepsy drug combined with (i) ANAVEX ® 19-144, or (ii) ANAVEX 19-144 ® and

ANAVEX 2-73 ® .

Both patents are expected to expire in October 2035, absent any patent term extension for regulatory

We also own three issued U.S.

patents with claims directed to

treating neurodevelopmental disorders.

These patents claim methods for treating a neurodevelopmental disorder, multiple sclerosis, or

their related biochemical and functional abnormalities by administering ANAVEX ® 2-73, ANAVEX ® 19-144, and/or

ANAVEX ® 1-41 (another sigma receptor ligand similar to ANAVEX ® 2-73), or compositions thereof.

All three patents

are expected to expire in January 2037, absent any patent term extension for regulatory delays.

patents with claims directed to treating neurodevelopmental disorders.

These patents claim

methods for treating a neurodevelopmental disorder, multiple sclerosis, or their related biochemical and functional abnormalities

by administering ANAVEX ® 2-73, ANAVEX ® 19-144, and/or ANAVEX ® 1-41 (another sigma receptor

ligand similar to ANAVEX ® 2-73), or compositions thereof.

All three patents are expected to expire in January 2037,

absent any patent term extension for regulatory delays.

In addition, we own one issued U.S.

with claims directed to methods of treating melanoma with a compound related to ANAVEX ® 2-73.

This patent is expected to

expire in February 2030, absent any patent term extension for regulatory delays.

Patent with claims directed to methods

of treating melanoma with a compound related to ANAVEX ® 2-73.

This patent is expected to expire in February 2030,

absent any patent term extension for regulatory delays.

We also own an issued U.S.

patent that claims crystalline

forms of ANAVEX ® 19-144, dosage forms and compositions containing the crystalline forms of ANAVEX ® 19-144,

and methods of treatment for Alzheimer’s disease.

This patent is expected to expire in July 2036, absent any patent term extension

for regulatory delays.

Further, we own one issued U.S.

Patent with claims directed to methods of treating cardiac dysfunction with ANAVEX ® 2-73.

patent that claims crystalline forms of ANAVEX ® 19-144,

dosage forms and compositions containing the crystalline forms of ANAVEX ® 19-144, and methods of treatment for Alzheimer’s

This patent is expected to expire in July 2036, absent any patent term extension for regulatory delays.

Additionally, we own one issued

Further, we own

one issued U.S.

Patent with claims directed to methods of treating cardiac dysfunction with ANAVEX ® 2-73.

is expected to expire in July 2038, absent any patent term extension for regulatory delays.

Additionally, we own one issued U.S.

Patent with claims directed to methods of treating insomnia or anxiety with ANAVEX ® 2-73, ANAVEX ® 19-144,

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We also own two issued U.S.

patents related to ANAVEX ® 1066.

The first of these two patents claims methods for treating or preventing pain using (+) ANAVEX ® 1066 isomer.

patent claims methods for treating or preventing pain using (-) ANAVEX ® 1066 isomer.

Both patents are expected to expire

in November 2036, absent any patent term extension for regulatory delays.

patents related

to ANAVEX ® 1066.

The first of these two patents claims methods for treating or preventing pain using (+) ANAVEX ® 1066

The second patent claims methods for treating or preventing pain using (-) ANAVEX ® 1066 isomer.

are expected to expire in November 2036, absent any patent term extension for regulatory delays.

For ANAVEX ® 2-73, ANAVEX ® 19-144,

ANAVEX ® 1-41, and ANAVEX ® 1066, we also have granted or pending applications in Australia, Canada, China,

Europe, Japan, and Hong Kong, which are expected to expire after 2035.

With regard to ANAVEX ® 3-71, we own

exclusive rights to two issued U.S.

patents with claims respectively directed to the ANAVEX ® 3-71 compound and methods of

treating various diseases including Alzheimer’s with the same.

These patents are expected to expire in April 2030, and January 2030,

respectively, absent any patent term extension for regulatory delays.

We also own exclusive rights to related patents or applications

that are granted or pending in Australia, Canada, China, Europe, Japan, Korea, New Zealand, Russia, and South Africa, which are expected

to expire in January 2030.

We also own other patent applications directed to

enantiomers, crystals, formulations, uses, and patient selection methods that may provide additional protection for one or more of our

product candidates.

ANAVEX ® 1-41, and ANAVEX ® 1066, we also have granted or pending applications in Australia, Canada,

China, Europe, Japan, and Hong Kong, which are expected to expire after 2035.

With regard to ANAVEX ® 3-71,

we own exclusive rights to two issued U.S.

patents with claims respectively directed to the ANAVEX ® 3-71 compound

and methods of treating various diseases including Alzheimer’s with the same.

These patents are expected to expire in April

2030, and January 2030, respectively, absent any patent term extension for regulatory delays.

We also own exclusive rights to related

patents or applications that are granted or pending in Australia, Canada, China, Europe, Japan, Korea, New Zealand, Russia, and

South Africa, which are expected to expire in January 2030.

We also own other patent applications directed

to enantiomers, crystals, formulations, uses, and patient selection methods that may provide additional protection for one or more

of our product candidates.

We regard patents and other intellectual property

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including the selective development, protection, and exploitation of our intellectual property rights.

In addition to filings made with

intellectual property authorities, we protect our intellectual property and confidential information by means of carefully considered

processes of communication and the sharing of information, and by the use of confidentiality and non-disclosure agreements and provisions

for the same in contractor’s agreements.

While no agreement offers absolute protection, such agreements provide some form of recourse

in the event of disclosure, or anticipated disclosure.

In addition to filings made

with intellectual property authorities, we protect our intellectual property and confidential information by means of carefully

considered processes of communication and the sharing of information, and by the use of confidentiality and non-disclosure agreements

and provisions for the same in contractor’s agreements.

While no agreement offers absolute protection, such agreements provide

some form of recourse in the event of disclosure, or anticipated disclosure.

intellectual property position, like that of many biomedical companies, is uncertain and involves complex legal and technical questions

for which important legal principles are unresolved.

For more information regarding challenges to our existing or future patents, see

“Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on November

For more information regarding challenges to our existing or future patents,

see “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K filed with the Securities and Exchange Commission

on November 28, 2022.

Financial Overview

The following discussion should be read in conjunction

with our interim condensed consolidated financial statements and related notes thereto contained elsewhere in this report.

Past operating

results are not necessarily indicative of results that may occur in future periods.

The discussion contains forward-looking statements,

which involve a number of risks and uncertainties.

See “Forward Looking Statements” included elsewhere in this report.

We are in the development stage and have not earned

any revenues since our inception in 2004.

We do not anticipate earning any revenues until we can establish an alliance with other companies

to develop, co-develop, license, acquire or market our products.

The following discussion should be read

in conjunction with our condensed interim consolidated financial statements and related notes thereto contained elsewhere in this

Past operating results are not necessarily indicative of results that may occur in future periods.

The discussion contains

forward-looking statements, which involve a number of risks and uncertainties.

See “Forward Looking Statements” included

elsewhere in this report.

We are in the development stage and have not

earned any revenue since our inception in 2004.

We do not anticipate earning any revenues until we can establish an alliance with

other companies to develop, co-develop, license, acquire or market our products.

Our operating costs consist primarily of research

and development activities including the cost of clinical trials and clinical supplies as well as clinical drug manufacturing and formulation.

Research and development expenses also include personnel related costs such as salaries and wages, and third-party contract research organization

(CRO) expenses in support of these clinical trials.

Personnel costs include salaries and wages, benefits, and non-cash stock-based compensation

charges associated with options and other equity awards granted to employees and consultants who are directly engaged in support of our

research and development activities.

General and administrative expenses consist of personnel

costs, expenses for outside professional services and expenses associated with operating as a public company.

Personnel costs consist

of salaries and wages, benefits and stock-based compensation for general and administrative personnel.

Outside professional services and

public company expenses include expenses related to compliance and reporting, additional insurance expenses, audit and SOX compliance,

expenses associated with patent research, applications and filings, investor and stockholder relations activities and other administrative

expenses and professional services.

Comparison of the three months ended December 31,

2022 and 2021

and development activities including the cost of clinical trials and clinical supplies as well as clinical drug manufacturing and

Research and development expenses also include personnel related costs such as salaries and wages, and third-party

contract research organization (CRO) expenses in support of these clinical trials.

Personnel costs include salaries and wages,

benefits, and non-cash stock-based compensation charges associated with options and other equity awards granted to employees and

consultants who are directly engaged in support of our research and development activities.

General and administrative expenses consist

of personnel costs, expenses for outside professional services and expenses associated with operating as a public company.

costs consist of salaries and wages, benefits and stock-based compensation for general and administrative personnel.

Outside professional

services and public company expenses include expenses related to compliance and reporting, additional insurance expenses, audit

and SOX compliance, expenses associated with patent research, applications and filings, investor and stockholder relations activities

and other administrative expenses and professional services.

Comparison of the three and six months ended

March 31, 2023 and 2022

Operating Expenses

Total operating expenses for the quarter ended December

31, 2022 were $15.4 million, compared to $11.7 million for the comparable quarter ended December 31, 2021.

Our research and development expenses for the three months ended December 31,

2022 were $12.1 million, as compared to $8.7 million for the three months ended December 31, 2021.

The increase in research and development

expenses is primarily related to (i) an increase in personnel costs of $0.7 million and an increase in stock based compensation expense

of $1.4 million as a result of the expansion of our team engaged in research and development activities, (ii) an increase of approximately

$0.7 million over the comparable period, relating to the manufacture of additional clinical trial supplies for both our ANAVEX ® 2-73

and ANAVEX ® 3-71 programs and (iii) an increase in costs associated with expanded enrollment in our EXCELLENCE trial.

The following table summarizes our research and development

expenses for the quarter ended December 31, 2022 and 2021 (in thousands):

Total operating expenses for the quarter ended

March 31, 2023 were $14.2 million, compared to $11.5 million for the comparable quarter ended March 31, 2022.

Total operating expenses

for the six months ended March 31, 2023 were $29.6 million, compared to $23.2 million for the comparable six month period ended

March 31, 2022.

Our research and development expenses for the

three months ended March 31, 2023 were $11.3 million, as compared to $8.6 million for the three months ended March 31, 2022.

increase in research and development expenses is primarily related to (i) an increase in personnel costs of $0.5 million as a result

of the expansion of our team engaged in research and development activities, (ii) an increase of approximately $1.0 million over

the comparable period, relating to the manufacture of additional clinical trial supply for ANAVEX ® 2-73 and ANAVEX ® 2-73

manufacturing development activities, (iii) an increase of approximately $0.40 million over the comparable period relating to the

manufacture and associated Phase 1 activities for ANAVEX ® 3-71 tablets and (iv) an increase in clinical site costs

associated with expanded enrollment in our EXCELLENCE trial.

Our research and development expenses for the

six months ended March 31, 2023 were $23.4 million, as compared to $17.3 million for the six months ended March 31, 2022.

in research and development expenses is primarily related to (i) an increase in personnel costs of $1.2 million and an increase

in stock-based compensation expense of $1.2 million as a result of the expansion of our team engaged in research and development

activities, (ii) an increase of approximately $2.1 million over the comparable period, relating to manufacturing activities for

both our ANAVEX ® 2-73 and ANAVEX ® 3-71 programs and (iii) an increase in costs associated with expanded

enrollment in our EXCELLENCE trial.

The following table summarizes our research

and development expenses for the three and six months ended March 31, 2023 and 2022 (in thousands):

Three months ended

Six months ended

Cost of external service providers

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Total research and development costs

During the quarter ended December 31, 2022 and 2021,

external service providers cost by product candidate was as follows (in thousands):

During the three and six months ended March

31, 2023 and 2022, external service providers cost by product candidate was as follows (in thousands):

Three months ended

Six months ended

ANAVEX ® 2-73

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Total external service provider costs

General and administrative expenses were $2.9

million for the three months ended March 31, 2023, as compared to $2.9 million for the same quarter of fiscal 2022.

administrative expenses were consistent between both periods.

General and administrative expenses were $6.2 million

for the three months ended December 31, 2022, as compared to $3.1 million for the same quarter of fiscal 2022, an increase of $0.2 million

mostly relating to an increase in professional and IP related costs.

During the quarter, we utilized cash and cash equivalents

of $5.8 million to fund our operations, compared to $3.5 million during comparable quarter in fiscal 2022.

Our cash position was $143.6

million at December 31, 2022 compared to $149.2 million at our fiscal year ended September 30, 2022.

for the six months ended March 31, 2023, as compared to $6.0 million for the same six-month period of fiscal 2022, an increase of $0.2

million mostly relating to an increase in professional and IP related costs.

During the first half of fiscal 2023, we utilized cash and

cash equivalents of $14.3 million to fund our operations, compared to $13.1 million during the same period of fiscal 2022.

Our cash position

was $153.5 million at March 31, 2023 compared to $149.2 million at our fiscal year ended September 30, 2022.

We expect to continue an increase in our research

and development expenditures as we advance our ANAVEX ® 2-73 clinical trials, including planned advancement of ANAVEX ® 2-73

for Parkinson’s disease program, planned initiation of a Fragile X clinical program, ongoing extension trials of our current clinical

programs, continued advancement of our other pipeline compounds such as ANAVEX ® 3-71, and as we continue to add additional

staffing to manage and support these clinical initiatives.

for Parkinson’s disease program, planned initiation of a Fragile X clinical program, ongoing extension trials of our current

clinical programs, continued advancement of our other pipeline compounds such as ANAVEX ® 3-71, and as we continue

to add additional staffing to manage and support these clinical initiatives.

Other income (net)

The net amount of other income for the three months

ended December 31, 2022 was $2.4 million as compared to $0.9 million for the comparable three months ended December 31, 2021.

in other income for the quarter is primarily related to an increase in return on excess cash invested in cash equivalents as well as a

foreign exchange gain relating to the recovery of the Australian dollar relative to the US dollar during the period.

Net loss for the current quarter was $13.0 million,

or $0.17 per share, as compared to $10.9 million, or $0.14 per share in the comparative quarter of fiscal 2022.

The increase in net loss

for the quarter is primarily related to increased research and development fees as discussed above.

The net amount of other income for the three

months ended March 31, 2023 was $1.1 million as compared to $1.1 million for the comparable three months ended March 31, 2022.

An increase in interest income on excess cash invested was offset by a one time financing expense of $964,344 associated with entering

into the 2023 Purchase Agreement (as described below).

The net amount of other income for the six

months ended March 31, 2023 was $3.5 million as compared to $2.0 million for the comparable six-months ended March 31, 2022.

increase in other income for the quarter is primarily related to an increase in return on excess cash invested in cash equivalents.

Net loss for the three months ended March 31,

2023, was $13.1 million, or $0.17 per share, as compared to $10.4 million, or $0.14 per share in the comparative quarter of fiscal

The increase in net loss for the quarter is primarily related to increased research and development fees as discussed above.

Net loss for the six months ended March 31,

2023, was $26.1 million, or $0.33 per share, as compared to $21.3 million, or $0.28 per share in the comparative period of fiscal

The increase in net loss for the six-month period is primarily related to increased research and development fees as discussed

Liquidity and Capital Resources

Working Capital

December 31, 2022

March 31, 2023

September 30, 2022

6 unchanged sentences

$ 142,491,042

At December 31, 2022, we had current assets of $148.4

million, a decrease of $4.3 million from September 30, 2022.

The decrease in current assets relates mostly to cash used in operations

of $5.8 million for the quarter ended December 31, 2022.

At December 31, 2022, we had current liabilities of

At March 31, 2023, we had current assets of

$159.2 million, an increase of $6.5 million from September 30, 2022.

The increase in current assets primarily relates to an increase

in cash and cash equivalents of $4.3 million mainly due to $18.0 million in net proceeds received from issuance of common shares

under the 2023 Purchase Agreement, described below, offset by cash used in operations of $14.3 million.

At March 31, 2023, we had current liabilities of

$14.0 million, an increase of $3.8 million from September 30, 2022.

A portion of this increase relates to an increase in deferred grant

income of $0.5 million relating to amounts received during the quarter for a research grant awarded by the Michael J.

Fox Foundation for

Parkinson’s Research.

Other increases in current liabilities relate to amounts owed at period end for manufacturing of additional

clinical trial supplies for use in future studies.

continue to use our capital resources to advance our clinical trials for ANAVEX ® 2-73 and ANAVEX ® 3-71, and

to perform work necessary to prepare for future development of our pipeline compounds.

Fox Foundation

for Parkinson’s Research.

Other increases in current liabilities relate to amounts owed at period end for manufacturing activities

and programs and laboratory and analysis work relating to the ANAVEX ® 2-73 Phase

2b/3 clinical trial in Alzheimer’s disease.

We intend to continue to use our capital resources

to advance our clinical trials for ANAVEX ® 2-73 and ANAVEX ® 3-71, and to perform work necessary to prepare

for future development of our pipeline compounds.

The following

table summarizes cash flows during the three months ended December 31, 2022 and 2021:

table summarizes cash flows during the six months ended March 31, 2023 and 2022:

Net cash flows used in operating activities

2 unchanged sentences

Net cash flows from financing activities

Decrease in cash and cash equivalents

$ (5,536,013 )

Increase in cash and cash equivalents

Cash flow used in operating activities

Net cash used in operating activities for the three

months ended December 31, 2022 was $5.8 million, compared to $3.5 million during the comparable quarter ended December 31, 2021.

Net cash used in operating activities for the six

months ended March 31, 2023 was $14.3 million, compared to $13.1 million during the comparable period ended March 31, 2022.

The principal

reason for this increase in net cash used in operating activities in the current period is due to the receipt of the Company’s annual

research and development incentive income refund in the comparable quarter.

reason for this increase in net cash used in operating activities in the current period is due to the increase in net loss over the comparable

Cash flow provided by financing activities

Cash provided by financing activities for the quarter

ended December 31, 2022 was $0.3 million, attributable to the exercise of employee stock options, while cash

provided by financing activities for the quarter ended December 31, 2021 was $2.5 million, primarily attributable to the sale of

common shares at various market prices under the Sales Agreement, described below.

Cash provided by financing activities for the

six months ended March 31, 2023 was $18.6 million, mainly attributable to the issuance of common shares under the 2023 Purchase

Agreement, described below, while cash provided by financing activities for the six months

ended March 31, 2022 was $14.4 million, primarily attributable to the sale of common shares at various market prices under

the Sales Agreement, described below.

Other Financings

Purchase Agreement

On February 3, 2023, the Company entered into

a $150,000,000 purchase agreement (the “2023 Purchase Agreement”) with Lincoln Park Capital Fund, LLC (“Lincoln

Park”), pursuant to which the Company has the right to sell and issue to Lincoln Park, and Lincoln Park is obligated to purchase,

up to $150,000,000 in value of its shares of common stock from time to time over a three-year period until February 3, 2026.

On any business day and subject to certain

customary conditions, the Company may direct LPC to purchase up to 200,000 shares of Common Stock (such purchases, “ Regular

Purchases ”).

The amount of a Regular Purchase may increase under certain circumstances based on the market price of the

Common Stock;

provided, however, that LPC’s committed obligation under any Regular Purchase shall not exceed $4,000,000.

The purchase price of shares of Common Stock will be based on the then prevailing market prices of such shares at the time of sales

as described in the Purchase Agreement.

There are no limits on the price per share that LPC may pay to purchase Common Stock under

the Purchase Agreement.

In addition, if the Company has directed LPC to purchase the full amount of Common Stock available as a

Regular Purchase on a given day, it may direct LPC to purchase additional amounts as “accelerated purchases” and “additional

accelerated purchases” as set forth in the Purchase Agreement.

The Purchase Agreement limits the Company’s

sale shares of Common Stock to LPC to 15,606,426 shares of Common Stock, representing 19.99% of the shares of the Common Stock

outstanding on the date of the Purchase Agreement unless (i) shareholder approval is obtained to issue more than such amount

or (ii) the average price of all applicable sales of Common Stock to LPC under the Purchase Agreement equals or exceeds the

lower of (A) the closing price of the Common Stock on the Nasdaq Capital Market immediately preceding the Execution Date or (B)

the average of the closing price of the Common Stock on the Nasdaq Capital Market for the five Business Days immediately preceding

the Execution Date.

The Purchase Agreement also prohibits the Company

from directing LPC to purchase any shares of Common Stock if those shares, when aggregated with all other shares of Common Stock

then beneficially owned by Lincoln Park and its affiliates, would result in LPC and its affiliates having beneficial ownership,

at any single point in time, of more than 4.99% of the then total outstanding shares of Common Stock, as calculated pursuant to

Section 13(d) of the Securities Exchange Act of 1934, as amended, and Rule 13d-3 thereunder.

In consideration for entering into the 2023

Purchase Agreement, the Company issued to Lincoln Park 75,000 shares of common stock as a commitment fee (the “initial commitment

shares”) during the six months ended March 31, 2023 and agreed to issue up to 75,000 shares pro rata, when and if, Lincoln

Park purchased, at the Company’s discretion, the $150,000,000 aggregate commitment.

During the six months ended March 31, 2023, the Company issued to Lincoln Park

an aggregate of 2,159,080 (2022:

Nil) shares of common stock under the 2023 Purchase Agreement, including 2,075,000 (2022:

of common stock for an aggregate purchase price of $18.2 million (2022:

$Nil) and 9,080 (2022:

Nil) commitment shares.

As of March 31, 2023, an amount of $131.8

million in shares of our common stock remain available for purchase by Lincoln Park under the Purchase Agreement.

Controlled Equity Offering Sales Agreement

On May 1, 2020, we entered into an Amended and Restated

Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co.

and SVB Leerink LLC (the “Sales Agents”),

pursuant to which we may offer and sell shares of common stock registered under an effective registration statement from time to time

through the Sales Agents (the “At-the-Market Offering”).

Upon delivery of a placement notice based on our instructions

and subject to the terms and conditions of the Sales Agreement, the Sales Agents may sell shares of common stock by methods deemed to

be an “at the market 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 our prior written

On May 1, 2020, we entered into an Amended

and Restated Sales Agreement (the “Sales Agreement”) with Cantor Fitzgerald & Co.

and SVB Leerink LLC (the “Sales

Agents”), pursuant to which we may offer and sell shares of common stock registered under an effective registration statement

from time to time through the Sales Agents (the “At-the-Market Offering”).

Upon delivery of a placement notice based on

our instructions and subject to the terms and conditions of the Sales Agreement, the Sales Agents may sell shares of common stock

by methods deemed to be an “at the market 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 our prior written consent.

We are not obligated to make any sales of shares under the Sales Agreement.

We or the Sales Agents may suspend or terminate the

At-the-Market Offering upon notice to the other party, subject to certain conditions.

The Sales Agents will act as agents on a commercially

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

and the rules of Nasdaq.

We or the Sales Agents may suspend or terminate the At-the-Market Offering upon notice to the other party, subject to certain conditions.

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

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

We have agreed to pay the Sales Agents’ commissions

1 unchanged sentence

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

No shares were sold during the quarter ended December

31, 2022 under the Sales Agreement.

During the quarter ended December 31 2021, 99,588

shares were sold under the Sales Agreement for gross proceeds of $2.3 million (net proceeds of $2.1 million after deducting commissions

and offering expenses).

Off-Balance Sheet Arrangements

We have no off-balance sheet

arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition,

revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to our stockholders.

No shares were sold during the six months ended

March 31, 2023 under the Sales Agreement.

During the six months ended March 31, 2022,

1,066,389 shares were sold under the Sales Agreement for gross proceeds of $14.8 million (net proceeds of $14.3 million after deducting

commissions and offering expenses).

Off-Balance Sheet

We have no off-balance

sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in

financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are

material to our stockholders.

CRITICAL ACCOUNTING POLICIES

We prepare our interim condensed

consolidated financial statements in accordance with accounting principles generally accepted in the United States of America and make

estimates and assumptions that affect our reported amounts of assets, liabilities, revenue and expenses, and the related disclosures of

contingent liabilities.

We base our estimates on historical experience and other assumptions that we believe are reasonable in the circumstances.

We prepare our condensed

interim consolidated financial statements in accordance with accounting principles generally accepted in the United States of America

and make estimates and assumptions that affect our reported amounts of assets, liabilities, revenue and expenses, and the related

disclosures of contingent liabilities.

We base our estimates on historical experience and other assumptions that we believe are

reasonable in the circumstances.

Actual results may differ from these estimates.

There have been no significant

changes in the critical accounting policies and estimates described in our Annual Report on Form 10-K for the year ended September 30,

2022, as filed with the SEC on November 28, 2022.

RECENT ACCOUNTING PRONOUNCEMENTS

Please refer to Note 2 “Recent

Accounting Pronouncements” in notes to our Interim Condensed Consolidated Financial Statements included in this Form 10-Q.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS.

There have been no

significant changes in the critical accounting policies and estimates described in our Annual Report on Form 10-K for the year

ended September 30, 2022, as filed with the SEC on November 28, 2022.

RECENT ACCOUNTING

PRONOUNCEMENTS

Please refer to Note

2 “Recent Accounting Pronouncements” in notes to our Condensed Interim Consolidated Financial Statements included in

this Form 10-Q.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET

Not applicable

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 2. Management’s Discussion and Analysis