What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-05-12 compared with 2023-02-10 · 718 added, 332 removed, 305 unchanged (77% of the section changed)

1 unchanged sentence

Balance Sheets

and other assets

CURRENT ASSETS:

OTHER ASSETS:

lease right-of-use assets

assets, non-current

AND STOCKHOLDERS' EQUITY

payable and accrued expenses

portion of other liabilities

portion of operating lease liabilities

derivative liability

Cash and cash equivalents

Investments in U.S.

Treasury Bills

Prepaids and other assets

Total current assets

Operating lease right-of-use assets

Intangible assets, net

Other assets, non-current

LIABILITIES AND STOCKHOLDERS EQUITY

CURRENT LIABILITIES:

liabilities, net of current portion

lease liabilities, net of current portion

payable, net of financing cost, unearned premium and discount of $ 1,738,942 at December 31, 2022 and $ 2,861,314 at June

and contingencies (Note 11)

STOCKHOLDERS'

Accounts payable and accrued expenses

Current portion of other liabilities

Current portion of operating lease liabilities

Current portion of Note payable, net of financing cost, unearned premium and discount of $ 1,108,932 at March 31, 2023

Warrant liabilities

Embedded derivative liability

Total current liabilities

Other liabilities, net of current portion

Operating lease liabilities, net of current portion

Note payable, net of current portion, financing cost, unearned premium and discount of $ 94,368 at March 31, 2023 and $ 2,861,314 at June 30, 2022

TOTAL LIABILITIES

Commitments and contingencies (Note 12)

STOCKHOLDERS EQUITY :

Preferred stock;

$ 0.001 par value;

1 unchanged sentence

0 shares issued and outstanding

stock, $ 0.0001 par value;

800,000,000 shares authorized at December 31, 2022 and June 30, 2022;

34,504,332 and 24,984,083 shares

issued and outstanding at December 31, 2022 and June 30, 2022, respectively

paid in capital

Common stock,

$ 0.0001 par value;

800,000,000 shares authorized at March 31, 2023 and June 30, 2022, respectively;

36,153,911 shares issued of

which 36,131,311 shares outstanding at March 31, 2023 and 24,984,083 issued and outstanding at June 30,

Additional paid in capital

other comprehensive income

Accumulated deficit

( 292,113,766 )

( 250,969,890 )

stockholders' equity

LIABILITIES AND STOCKHOLDERS' EQUITY

Treasury Stock

Total stockholders equity

TOTAL LIABILITIES AND STOCKHOLDERS EQUITY

accompanying notes to unaudited condensed financial statements

Statements of Operations

and development expenses

general and administrative expenses

Statements of Operations and Other Comprehensive Income

Three Months Ended

Nine Months Ended

March 31, 2023

March 31, 2022

March 31, 2023

March 31, 2022

OPERATING EXPENSES:

FROM OPERATIONS

Research and development expenses

Selling, general and administrative expenses

TOTAL OPERATING EXPENSES

LOSS FROM OPERATIONS

( 13,774,509 )

2 unchanged sentences

( 17,961,126 )

EXPENSE (INCOME):

in fair value of derivative liabilities

OTHER EXPENSE (INCOME):

Change in fair value of derivative liabilities

( 1,168,804 )

Interest expense

Interest income

TOTAL OTHER EXPENSE, NET

$ ( 15,041,163 )

OTHER EXPENSE (INCOME), NET

$ ( 7,040,644 )

1 unchanged sentence

$ ( 17,995,711 )

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$ ( 15,041,163 )

1 unchanged sentence

$ ( 41,143,876 )

LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS

$ ( 17,995,711 )

NET LOSS PER COMMON SHARE

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING

$ ( 15,041,163 )

1 unchanged sentence

$ ( 41,143,876 )

LOSS PER COMMON SHARE

AVERAGE NUMBER OF COMMON SHARES OUTSTANDING

$ ( 17,995,711 )

Other comprehensive income

Unrealized gain on investments for available-for-sale

Other comprehensive income

Comprehensive loss

$ ( 15,024,658 )

$ ( 7,040,644 )

$ ( 41,127,371 )

$ ( 17,995,711 )

accompanying notes to unaudited condensed financial statements

Statements of Cash Flows

FLOWS FROM OPERATING ACTIVITIES:

Nine Months Ended

March 31, 2023

March 31, 2022

CASH FLOWS FROM OPERATING ACTIVITIES:

$ ( 41,143,876 )

$ ( 17,995,711 )

to reconcile net loss to net cash used in operating activities:

of intangible assets

based compensation - restricted stock units

based compensation expense - stock options

of financing costs

of unearned loan discount

of loan premium

of operating lease right-of-use assets

in fair value of derivative liability

Adjustments to reconcile net loss to net cash used in operating activities:

Amortization of intangible assets

Stock based compensation - restricted stock units

Stock based compensation expense - stock options

Amortization of financing costs

Accretion of unearned loan discount

Accretion of loan premium

Change in operating lease right-of-use assets

Change in fair value of derivative liabilities

( 1,168,804 )

in operating assets and liabilities:

payable and accrued expenses

lease liabilities

Change in operating assets and liabilities

Prepaids and other assets

Accounts payable and accrued expenses

Operating lease liabilities

Other liabilities

( 1,159,768 )

cash used in operating activities

Net cash used in operating activities

( 28,965,321 )

( 13,125,753 )

FLOWS FROM FINANCING ACTIVITIES:

proceeds from issuance of common stock

from note payable net of financing costs

from exercise of stock options

proceeds from issuance of common stock - Related Party

cash provided by financing activities

increase in cash

beginning of period

end of period

CASH FLOW INFORMATION:

paid for interest

CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of U.S.

Treasury Bills

( 12,504,943 )

Net cash used in investing activities

( 12,504,943 )

CASH FLOWS FROM FINANCING ACTIVITIES:

Net proceeds from issuance of common stock

Proceeds from note payable net of financing costs

Proceeds from exercise of stock options

Net proceeds from issuance of common stock - Related Party

Net cash provided by financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

SUPPLEMENTAL CASH FLOW INFORMATION:

Cash paid for interest

SCHEDULE OF NON-CASH FINANCING AND INVESTING ACTIVITIES:

Right of use assets obtained in exchange for lease obligations

Treasury Bills

accompanying notes to unaudited condensed financial statements

Statements of Changes in Stockholders Equity

the periods July 1, 2021 through December 31, 2021 and July 1, 2022 through December 31, 2022

the periods July 1, 2021 through March 31, 2022

Comprehensive

Stockholders

June 30, 2021

Balance, June 30, 2021

$ 229,933,505

$ ( 224,885,422 )

from issuance of common stock,net of cost of $2,224,992

compensation - restricted stock units

option based compensation

Proceeds from issuance of common stock,net of cost of $2,224,992

Stock-based compensation – restricted stock units

Stock option based compensation

( 5,540,753 )

September 30, 2021

Balance, September 30, 2021

( 230,426,175 )

compensation - restricted stock units

option based compensation

Stock-based compensation – restricted stock units

Stock option based compensation

( 5,414,317 )

December 31, 2021

Balance, December 31, 2021

( 235,840,492 )

Stock option based compensation

( 7,040,644 )

June 30, 2022

( 7,040,644 )

Balance, March 31, 2022

$ 252,833,422

option based compensation

compensation - restricted stock units

from issuance of common stock, net of costs of $368,370

from issuance of common stock, net of costs of $94,160 - Related Party

$ ( 242,881,133 )

accompanying notes to unaudited condensed financial statements

Statements of Changes in Stockholders Equity

the periods July 1, 2022 through March 31, 2023

Comprehensive

Stockholders

Balance, June 30, 2022

$ 254,638,329

September 30, 2022

$ ( 250,969,890 )

compensation - restricted stock units

option based compensation

exercise of options

exercise of warrants

from exercise of options

from issuance of common stock, net of costs of $1,206,206

Stock option based compensation

Stock-based compensation – restricted stock units

Proceeds from issuance of common stock, net of costs of $368,370

Proceeds from issuance of common stock, net of costs

of $94,160 – Related Party

( 10,415,711 )

December 31, 2022

Balance, September 30, 2022

( 261,385,601 )

Stock-based compensation – restricted stock units

Stock option based compensation

Cashless exercise of options

Cashless exercise of warrants

Proceeds from exercise of options

Proceeds from issuance of common stock, net of costs of $1,206,206

( 15,687,002 )

Balance, December 31, 2022

( 277,072,603 )

Stock-based compensation – restricted stock units

Issuance of restricted stock units

Stock option based compensation

Proceeds from issuance of common stock, net of costs of $338,846

( 15,041,163 )

Unrealized gain on available-for-sale securities

Balance, March 31, 2023

$ 313,811,910

$ ( 292,113,766 )

accompanying notes to unaudited condensed financial statements

to Condensed Financial Statements

the Three and Six Months Ended December 31, 2022 and 2021

the Three and Nine Months Ended March 31, 2023 and 2022

(the Company or we or our) is a clinical-stage company developing innovative drug therapies

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NE3107 in subjects who have mild to moderate AD (NCT04669028).

The Company is targeting primary completion of this study in the third

The Company is targeting primary completion of this study in the fourth

quarter of calendar year 2023.

December 2022, the Company released topline results from its Phase 2 study assessing NE3107’s safety and tolerability and potential

pro-motoric impact in Parkinson’s disease patients.

The NM201 study (NCT05083260) was a double-blind, placebo-controlled, safety,

tolerability, and pharmacokinetics study in PD participants treated with carbidopa/levodopa and NE3107.

Forty-five patients with a defined

L-dopa “off state” were randomized 1:1 to placebo:

NE3107 20 mg twice daily for 28 days.

The trial was launched with two

Phase 2 study of NE3107 in Parkinsons disease (PD (NCT05083260), completed in December was a double-blind, placebo-controlled,

safety, tolerability, and pharmacokinetics study in PD participants treated with carbidopa/levodopa and NE3107.

45 patients with a defined

L-dopa off state were randomized 1:1 to placebo:NE3107 20 mg twice daily for 28 days.

This trial was launched with two

design objectives:

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promotoric activity and apparent enhancement of levodopa activity can be seen in humans.

Both objectives of the study were met.

continues to process its findings from its completed NM201 study as it prepares for the next round of clinical studies in PD.

Both objectives were met.

The Company continues

to process its findings from its completed NM201 study as it prepares for the next round of clinical studies in PD.

Neuroinflammation,

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NE3107 is patented in the United States, Australia, Canada, Europe and South Korea.

The Company’s Orphan drug candidate BIV201

(continuous infusion terlipressin), with FDA Fast Track status, is being evaluated in a US Phase 2b study for the treatment of refractory

ascites due to liver cirrhosis with top-line results anticipated in mid-2023.

BIV201 is administered as a patent-pending liquid formulation.

Companys Orphan drug candidate BIV201 (continuous infusion terlipressin), with FDA Fast Track status is being evaluated

in a US Phase 2b study for the treatment of refractory ascites due to liver cirrhosis was paused in March 2023.

Data from the first

15 patients treated with BIV201 plus standard of care (SOC) resulted in a 34% reduction in ascites fluid during the 28 days after

treatment initiation compared to the 28 days prior to treatment (p=0.0046).

This improvement was significantly different from those

treated with SOC only who experienced a mean increase in ascites fluid of 3.1% (BIV201 vs.

Patients who completed the

treatment with BIV201 experienced a 53% reduction in ascites fluid (p=0.001), which was significantly different from those treated

with SOC (p=0.007).

This improvement was sustained in this group during the 3 months after treatment initiation as compared to the

3-month pre-treatment period (43% reduction, p=0.06).

Overall treatment appeared to be well tolerated.

There were no unexpected

serious adverse events and overall safety was consistent with the patient population.

The current trial (NCT04112199) evaluates the

efficacy of BIV201 combined with SOC, compared to SOC alone, for the treatment of refractory ascites.

Terlipressin was administered with a continuous low dose infusion via a portable pump in two 28-day treatment cycles.

endpoints are the incidence of complications of at least Grade 2 severity, and the change in cumulative ascites in the 12-week

period following randomization compared to a 12-week pre-treatment period.

The BIV201 trial planned to enroll 30 patients to be

treated in the home care setting.

The active agent is approved in the U.S.

and in about 40 countries for related complications of advanced liver cirrhosis.

and in about 40 countries for related complications of

advanced liver cirrhosis.

BIV201 development program was initiated by LAT Pharma LLC (LAT Pharma).

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assets and the satisfaction of liabilities in the normal course of business.

As of December 31, 2022, the Company had working capital

of approximately $ 38.2

million, cash of approximately $ 45.7

million, stockholders’ equity of approximately

million, and an accumulated deficit of approximately

The Company has not generated

any revenue to date and no revenue is expected in the foreseeable future.

The Company’s future operations are dependent on the

success of the Company’s ongoing development and commercialization efforts, as well as its ability to secure additional financing

Although our cash balance may sustain operations over the next 12 months from the balance sheet date if measures

are taken to delay planned expenditures in our research protocols and slow the progress in the Company’s clinical programs, the

Company’s current planned operations to meet certain goals and objectives project cash flows to be depleted within that period

As of March 31, 2023, the Company had working capital of $ 28 .0 million, cash and cash equivalents and US treasury bills totaling approximately $ 43.8 million, stockholders equity of approximately

$ 21.7 million, and an accumulated deficit of approximately $ 292 million.

The Company has not generated any revenue to date and no revenue

is expected in the foreseeable future.

The Companys future operations are dependent on the success of the Companys ongoing

development and commercialization efforts, as well as its ability to secure additional financing as needed.

Although our cash balance

may sustain operations over the next 12 months from the balance sheet date if measures are taken to delay planned expenditures in our

research protocols and slow the progress in the Companys clinical programs, the Companys current planned operations to

meet certain goals and objectives project cash flows to be depleted within that period of time.

expects that future sources of funding may include sales of equity, obtaining loans, or other strategic transactions.

duration and spread of the COVID-19 pandemic and the long-term impact of COVID-19 and any variants on the financial markets and the overall

economy continue to be highly uncertain and cannot be predicted at this time.

If the financial markets and/or the overall economy are

impacted for an extended period, the Company’s ability to raise funds may be materially adversely affected.

In addition, the COVID-19

pandemic has created a widespread labor shortage, including a shortage of medical professionals, and has impacted and may continue to

impact the potential patient participation in our studies, which may adversely impact our ability to continue or complete our clinical

trials on the Company’s planned timeline.

economy continue to be uncertain and cannot be predicted at this time.

If the financial markets and/or the overall economy are impacted

for an extended period, the Companys ability to raise funds may be materially adversely affected.

management continues to pursue the Companys strategic plans, there is no assurance that the Company will be successful in obtaining

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Companys Annual Report on Form 10-K for the fiscal year ended June 30, 2022, filed with the SEC on September 27, 2022 (the 2022

prior period amounts have been reclassified for consistency with the current period presentation.

loss per Common Share

3 unchanged sentences

of common stock outstanding and potentially outstanding shares of common stock during the period to reflect the potential dilution that

could occur from common shares issuable through stock options, warrants, and convertible debentures.

For the three and six months ended

December 31, 2022 and 2021, such amounts were excluded from the diluted loss since their effect was considered anti-dilutive due to the

could occur from common shares issuable through stock options, warrants, and restricted stock units.

For the three and nine months ended

March 31, 2023, and 2022, such amounts were excluded from the diluted loss since their effect was considered anti-dilutive due to the

net loss for the period.

table below shows the number of outstanding stock options and warrants as of December 31, 2022 and 2021:

table below shows the number of outstanding stock options, warrants and restricted stock units as of March 31, 2023 and 2022:

Schedule of Dilutive securities were excluded from the computation of diluted loss per share

March 31, 2023

March 31, 2022

Number of Shares

Stock Options

Restricted Stock Units

Accounting Pronouncements

2 unchanged sentences

that are expected to have a material impact on the Companys balance sheets or statements of operations since the 2022 Form 10-K.

and cash equivalents

and cash equivalents consisted of cash deposits and money market funds held at a bank and funds held in a brokerage account which included

treasury money market fund and U.S.

Treasury Bills with original maturities of 3 months or less.

Developments Affecting the Financial Services Industry and Concentration of Risk

of March 31, 2023 and December 31, 2022, the Company had cash deposited in certain financial institutions in excess of federally insured

The Company regularly monitors the financial stability of these financial institutions and believes that it is not exposed to

any significant credit risk in cash and cash equivalents.

However, in March and April 2023, certain U.S.

government banking regulators

took steps to intervene in the operations of certain financial institutions due to liquidity concerns, which caused general heightened

uncertainties in financial markets.

While these events have not had a material direct impact on the Companys operations, if further

liquidity and financial stability concerns arise with respect to banks and financial institutions, either nationally or in specific regions,

the Companys ability to access cash or enter into new financing arrangements may be threatened, which could have a material adverse

effect on its business, financial condition and results of operations.

Treasury Bills

Investments in U.S.

Treasury Bills with

maturities greater than 3 months, are accounted for as available for sale and are recorded at fair value.

Unrealized gains were

included in other comprehensive income in the accompanying the statements of operations and other comprehensive income.

value measurement of assets and liabilities

determine the fair values of our financial instruments based on the fair value hierarchy, which requires an entity to maximize the use

of observable inputs and minimize the use of unobservable inputs when measuring fair value.

Fair value is defined as the price that would

be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement

The fair value assumes that the transaction to sell the asset or transfer the liability occurs in the principal or most advantageous

market for the asset or liability and establishes that the fair value of an asset or liability shall be determined based on the assumptions

that market participants would use in pricing the asset or liability.

The classification of a financial asset or liability within the

hierarchy is based upon the lowest level input that is significant to the fair value measurement.

The fair value hierarchy prioritizes

the inputs into three levels that may be used to measure fair value:

1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities.

2 - Inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability,

either directly or indirectly through market corroboration, for substantially the full term of the financial instrument.

3 - Inputs are unobservable inputs based on our assumptions.

Investments in U.S.

Treasury Bills available for sale

following is a summary of the U.S.

Treasury Bills held at March 31, 2023:

Schedule of U.S.

treasury bills held

Total Accumulated

Unrealized Gain

Unrealized loss

Other Comprehensive Income

Treasury Bills due is 3 - 6 months

Companys intangible assets consist of intellectual property acquired from LAT Pharma.

and are amortized over their estimated useful

The following is a summary of the Company’s intangible assets as of December 31, 2022 and June 30, 2022:

following is a summary of the Companys intangible assets as of March 31, 2023 and June 30, 2022:

Schedule of intangible assets

Accumulated Amortization

March 31, 2023

June 30, 2022

Intellectual Property

Less Accumulated Amortization

( 1,599,331 )

( 1,427,298 )

Property, Net

expense was $ 57,344 in each of the three-month periods ended December 31, 2022 and 2021.

Intellectual Property, Net

expense was $ 57,344 in each of the three-month periods ended March 31, 2023 and 2022.

Amortization expense was $ 172,033 and $ 172,032

in each of the six-month periods ended December 31, 2022 and 2021, respectively.

The Company amortizes intellectual property over the

expected, original useful lives of 10 years.

in each of the nine-month periods ended March 31, 2023 and 2022, respectively.

The Company amortizes intellectual property over the expected,

original useful lives of 10 years.

future amortization expense is as follows:

Schedule of future amortization expense

ending June 30, 2023 (Remaining six months)

Year ending June 30, 2023 (Remaining three months)

Intellectual Property, Net

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Companys issued and outstanding common stock.

current portion of other liabilities at December 31, 2022 were $ 338,698 and at June 30, 2022 was $1.3 1,304,925 million, including $338,698 and

$580,614, respectively, of retention bonus payable for arrangements with certain employees.

The payment terms of the total retention

bonus arrangements of $ 1,161,000 recognized in August 2021 provided for equal monthly installments over a 24-month period and began in August

current portion of other liabilities at March 31, 2023 and June 30, 2022 were $ 193,542 and $ 1.3 million, and included $ 193,542 and $ 580,614 ,

respectively, of a retention bonus payable for arrangements with certain employees.

The payment terms of the total retention bonus arrangements

of $ 1,161,000 recognized in August 2021 provided for equal monthly installments over a 24-month period and began in August 2021.

November 30, 2021 (the Closing Date), the Company entered into a Loan and Security Agreement and the Supplement to the

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clinical trials, which were not achieved.

The Loan bears interest at an annual rate equal to the greater of (a) the sum of 7.00 % plus the prime rate as reported

in The Wall Street Journal and (b) 10.75%.

The prime rate at December 31, 2022 was 7.5 % .

The Loan is secured by a lien upon and security

interest in all of the Company’s assets, including intellectual property, subject to agreed exceptions.

The maturity date of the

Loan is December 1, 2024.

The Loan bears interest at an annual rate equal to the greater of (a) the sum of 7.00 % plus

the prime rate as reported in The Wall Street Journal and (b) 10.75%.

The prime rate at March 31, 2023 was 8.0 %.

The Loan is secured

by a lien upon and security interest in all of the Companys assets, including intellectual property, subject to agreed exceptions.

The maturity date of the Loan is December 1, 2024.

Loan Agreement requires monthly interest-only payments during the first eighteen months of the term of the Loan.

Following the

interest-only period, the Company will make equal monthly payments of principal, plus accrued interest, until the Loan’s

maturity date when all remaining principal and accrued interest is due.

If the Company prepays the Loan, it will be required to pay

(a) a prepayment fee in an amount equal to 3.0% of the principal amount of the Loan that is prepaid during the interest-only period;

and (b) a prepayment fee in an amount equal to 1.0% of the principal amount of the Loan that is prepaid after the interest-only

At the Loan’s maturity date, or on the date of the prepayment of the Loan, the Company will be obligated to pay

a final payment equal to 4.25% of the Loan commitment amount, the sum of Tranche 1 and Tranche 2.

Following the interest-only

period, the Company will make equal monthly payments of principal, plus accrued interest, until the Loans maturity date when all

remaining principal and accrued interest is due.

If the Company prepays the Loan, it will be required to pay (a) a prepayment fee in

an amount equal to 3.0% of the principal amount of the Loan that is prepaid during the interest-only period;

and (b) a prepayment fee

in an amount equal to 1.0% of the principal amount of the Loan that is prepaid after the interest-only period.

At the Loans maturity

date, or on the date of the prepayment of the Loan, the Company will be obligated to pay a final payment equal to 4.25% of the Loan commitment

amount, the sum of Tranche 1 and Tranche 2.

Loan Agreement includes a conversion option to convert up to $5.0 million of the principal amount of the Loan outstanding at the option

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$ 1.4 million to the fair value of the Avenue Warrants and approximately $ 2.2 million to the fair value of the embedded conversion option.

Accordingly, the total amount of unearned discount of approximately $ 3.7

million, the total direct financing cost of approximately $ 390,000

and premium of $ 850,000

are recognized on an effective interest method over the term of the Loan.

The adjusted effective interest rate is 25%.

interest expense of approximately $ 1.1

million for the three months ended December 31, 2022, was recognized in the accompanying statements of operations and included the

interest only payments totaling approximately $ 518,000 ,

the amortization of financing costs of approximately $ 43,000 ,

unearned discount of approximately $ 400,000

and the accretion of loan premium of approximately $93,000.

The total interest expense of approximately $ 2.1

million for the six- months ended December 31, 2022, was recognized in the accompanying statements of operations and included

interest only payments totaling approximately $ 987,000 ,

the amortization of financing costs of approximately $ 85,000 ,

unearned discount of approximately $ 800,000

and the accretion of loan premium of approximately $237,000.

of December 31, 2022, the remaining principal balance of $15 million under the Loan is payable in 18 monthly equal installments beginning

Accordingly, the total amount of unearned discount of approximately $ 3.7 million, the total direct financing cost of approximately $ 390,000

and premium of $ 850,000 are recognized on an effective interest method over the term of the Loan.

The adjusted effective interest rate

The total interest expense of approximately $ 1.1 million for the three months ended March 31, 2023, was recognized in the accompanying

statements of operations and included the interest only payments totaling approximately $ 547,000 , the amortization of financing costs

of approximately $ 43,000 , unearned discount of approximately $ 400,000 and the accretion of loan premium of approximately $93,000.

total interest expense of approximately $ 3.2 million for the nine- months ended March 31, 2023, was recognized in the accompanying statements

of operations and included interest only payments totaling approximately $ 1.5 million, the amortization of financing costs of approximately

$128,000, unearned discount of approximately $ 1.2 million and the accretion of loan premium of approximately $ 329,000 .

carrying value of notes payable at March 31, 2022 was approximately $ 11.6 million, net of unearned discount of approximately $ 3.1 million,

unamortized direct costs of approximately $ 333,000 and accreted premium of approximately $ 94,000 in the accompanying balance sheets.

The total interest expense of approximately $ 919,000 and $ 1.2 million for the three and nine months ended March 31, 2022, respectively;

was recognized in the accompanying statements of operations.

The amortization of financing costs was approximately $ 43,000 and $ 57,000

for the three and nine months ended March 31, 2022, respectively.

The accretion of loan premium was approximately $ 71,000 and $ 94,000

for the three and nine months ended March 31, 2022, respectively.

of March 31, 2023, the remaining principal balance of $15 million under the Loan is payable in 18 monthly equal installments beginning

July 1, 2023;

for a total of $10.0 million and $5.0 million in the fiscal years ended June 30, 2024 and 2025 respectively.

following is a summary of the Notes Payable as of December 31, 2022 and June 30, 2022:

following is a summary of the Notes Payable as of March 31, 2023 and June 30, 2022:

portion of Notes Payable

Schedule of note payable

debt financing costs

unearned discount

March 31, 2023

June 30, 2022

Current portion of Notes Payable

Less debt financing costs

Less unearned discount

( 1,267,811 )

Plus accretion of loan premium

Current portion of Notes Payable, net of financing costs, unearned premiums and discount

portion of Notes Payable

March 31, 2023

June 30, 2022

Notes Payable

Less debt financing costs

Less unearned discount

( 2,735,802 )

accretion of loan premium

Payable, net of financing costs, unearned premiums and discount

Plus accretion of loan premium

Notes Payable, net of the current portion, financing costs, unearned premiums and discount

future amortization expense and accretion of premium is as follows:

Schedule of Estimated future amortization expense and accretion of premium

Financing Costs

accretion Premium

ending June 30, 2023 (Remaining 6 months)

Unearned Discount

Debt Financing Costs

Loan accretion Premium

Year ending June 30, 2023 (Remaining 3 months)

Value Measurements

December 31, 2022 and June 30, 2022, the estimated fair value of derivative liabilities measured on a recurring basis are as follows:

March 31, 2023 and June 30, 2022, the estimated fair value of derivative liabilities measured on a recurring basis are as follows:

Schedule of derivative liabilities at fair value

liability Warrants

liability Conversion option on notes payable

Value Measurements at

liability Warrants

liability Conversion option on note payable

following table presents the activity for liabilities measured at fair value using unobservable inputs for the six months ended December

Fair Value Measurements at

March 31, 2023

Derivative liability - Warrants

Derivative liability - Conversion option on notes payable

Total derivatives

Fair Value Measurements at

June 30, 2022

Derivative liability - Warrants

Derivative liability - Conversion option on note payable

Total derivatives

following table presents the activity for liabilities measured at fair value using unobservable inputs for the nine months ended March

Fair value, liabilities measured on recurring basis

liabilities Avenue Warrants

liability Conversion Option on Convertible Debenture

at July 1, 2022

to level 3 liabilities

in in fair value of level 3 liability

in and/or out of Level 3

at December 31, 2022

following table presents the activity for liabilities measured at fair value using unobservable inputs for the six months ended December

liabilities Avenue Warrants

liability Conversion Option on Convertible Debenture

at July 1, 2021

to level 3 liabilities

in fair value of level 3 liability

in and/or out of Level 3

at December 31, 2021

fair values of derivative liabilities for the Avenue Warrants and conversion option at December 31, 2022 in the accompanying balance

sheet, were approximately $1.8 million and approximately $2.3 million, respectively.

The total change in the fair value of the

derivative liabilities totaled approximately $3.2 million and $3.8 million for the three and six months ended December 31, 2022,

respectively;

and accordingly, was recorded in the accompanying statement of operations.

The assumptions used in the Black Scholes

model to value the derivative liabilities at December 31, 2022 included the closing stock price of $ 7.77

for the Avenue Warrants, the exercise price of $ 5.82 , 4 -year

term, risk free rate of 4.11 %

and volatility of 78.5 %;

and for the embedded derivative liability of the conversion option, the conversion price of $ 6.98 ;

term, risk free rate of 4.41 %

and volatility of 66.9 %.

Derivative liabilities - Warrants

Derivative liability - Conversion Option on Convertible Debenture

Balance at July 1, 2022

Additions to level 3 liabilities

Change in in fair value of level 3 liability

Transfer in and/or out of Level 3

Balance at March 31, 2023

following table presents the activity for liabilities measured at fair value using unobservable inputs for the nine months ended March

Derivative liabilities - Warrants

Derivative liability - Conversion Option on Convertible Debenture

Balance at July 1, 2021

Additions to level 3 liabilities

Change in fair value of level 3 liability

Transfer in and/or out of Level 3

Balance at March 31, 2022

fair values of derivative liabilities for the Avenue Warrants and conversion option at March 31, 2023 in the accompanying balance sheet,

were approximately $2.0 million and approximately $2.6 million, respectively.

The total change in the fair value of the derivative liabilities

totaled approximately $366,000 and $4.2 million for the three and nine months ended March 31, 2023, respectively;

and accordingly, was

recorded in the accompanying statement of operations.

The assumptions used in the Black Scholes model to value the derivative liabilities

at March 31, 2023 included the closing stock price of $ 8.08 per share;

for the Avenue Warrants, the exercise price of $ 5.82 , remaining

term 3.7 year, risk free rate of 3.7 % and volatility of 83.7 %;

and for the embedded derivative liability of the conversion option, the

conversion price of $ 6.98 ;

remaining term 1.7 years, risk free rate of 4.35 % and volatility of 76.24 %.

liability – Avenue Warrants

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Under applicable accounting guidance, stock warrants that are precluded from being indexed to the Companys

own stock because of full-rachet and anti-dilution provisions or adjustments to the strike price due to an occurrence of a future event are accounted for as derivative financial instruments.

Avenue Warrants were not considered to be indexed to the Company’s own stock, and accordingly, were recorded as a derivative liability at fair

value in the accompany balance sheet at December 31, 2022.

Black Scholes model was used to calculate the fair value of the warrant derivative to bifurcate the warrant derivative amount from

the Avenue Loan amount funded.

The Avenue Warrants are recorded at their fair values at the date of issuance and remeasured at

December 31, 2022.

own stock because of full-rachet and anti-dilution provisions or adjustments to the strike price due to an occurrence of a future event

are accounted for as derivative financial instruments.

The Avenue Warrants were not considered to be indexed to the Companys own

stock, and accordingly, were recorded as a derivative liability at fair value in the accompany balance sheet at March 31, 2023.

Black Scholes model was used to calculate the fair value of the warrant derivative to bifurcate the warrant derivative amount from the

Avenue Loan amount funded.

The Avenue Warrants are recorded at their fair values at the date of issuance and remeasured at March 31,

The assumptions used for the fair value calculation at November 30, 2021 included:

the closing stock price of

the closing stock price of $ 6.44 per share;

the exercise price of $ 5.82 ;

a risk free rate of 1.14 %

and volatility of 74.4 %.

a risk free rate of 1.14 % and volatility of 74.4 %.

derivative liability – Conversion Option

The embedded derivative liability represents the

optional conversion feature of up to $5.0 million of the outstanding Loan, which meets the definition of a derivative and requires bifurcation

from the loan amount.

embedded derivative liability represents the optional conversion feature of up to $5.0 million of the outstanding Loan, which meets the

definition of a derivative and requires bifurcation from the loan amount.

Black Scholes model was used to calculate the fair value of the embedded derivative to bifurcate the embedded derivative amount representing

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risk free rate of 0.81 % and volatility of 76.85 %.

following table summarizes the activity relating to the Company’s stock options for the six months ended December 31, 2022:

of March 31, 2023, investments in U.S.

Treasury Bills were valued through use of quoted prices and are classified as Level 1.

The following

table presents information about our assets that are measured at fair value on a recurring basis using the above input categories.

Measured at fair value on a recurring basis

Fair Value Measurements at

March 31, 2023

Cash and cash equivalent

Treasury Bills due in 3 months or less

Treasury Bills due in 3 - 6 months

Fair Value Measurements at

June 30, 2022

Cash and cash equivalent

Treasury Bills due in 3 months or less

Treasury Bills due in 3 - 6 months

following table summarizes the activity relating to the Companys stock options for the nine months ended March 31, 2023:

Schedule of summarizes the activity relating to the Company’s stock options

Weighed-Average

Exercise Price

Remaining Average Contractual Term

Intrinsic Value

at June 30, 2022

at December 31, 2022

Weighed-Average Exercise Price

Weighted Remaining Average Contractual Term

Aggregate Intrinsic Value

Outstanding at June 30, 2022

Options Expired

Options Canceled

Options Exercised

Outstanding at March 31, 2023

Exercisable at March 31, 2023

fair value of each option grant on the date of grant is estimated using the Black-Scholes option.

The pricing model reflects the following

weighted-average assumptions for the six months ended December 31, 2022 and 2021:

weighted-average assumptions for the nine months ended March 31, 2023 and 2022:

Schedule of assumptions used

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as they are incurred.

total stock option-based compensation expense for three-month ended December 31, 2022 and 2021 was of $ 1,712,787 and $ 1,147,422 , respectively

and for the six months ended December 31,2022 and 2021 was $ 2,591,427 and $ 3,074,384 , respectively.

following is a summary of stock options outstanding and exercisable by exercise price as of December 31, 2022:

total stock option-based compensation expense for three-month ended March 31, 2023 and 2022 was of $ 888,998 and $ 930,334 , respectively

and for the nine months ended March 31,2023 and 2022 was $ 3,480,425 and $ 4,004,718 , respectively.

following is a summary of stock options outstanding and exercisable by exercise price as of March 31, 2023:

Schedule of summary of stock options outstanding and exercisable

Average Contract Life

Exercise Price

Weighted Average Contract Life

of common stock for cash

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with its registered public offering of approximately $ 18.5 million, net of issuance costs of approximately $ 2.2 million.

August 31, 2022, the Company entered into a Controlled Equity Offering Sales Agreement (the “Sales Agreement”) with

Cantor Fitzgerald & Co.

September 24, 2021, the Company issued 92,000 of its Class A common stock at $ 8.00 per share in connection with the underwriters

exercise of its over-allotment option in for the August 2021 registered public offering, resulting in net proceeds to the Company of

approximately $ 707,000 , net of issuance cost of approximately $ 29,000 .

August 31, 2022, the Company entered into a Controlled Equity Offering Sales Agreement (the Sales Agreement) with Cantor

Fitzgerald & Co.

Riley Securities, Inc.

(collectively, the “Agents”), pursuant to which the Company

may issue and sell from time-to-time shares of the Company’s common stock through the Agents, subject to the terms and

conditions of the Sales Agreement.

During the three months ended December 31, 2022, the Company sold 4,312,741 shares

of common stock under the Sales Agreement for total net proceeds of $ 32.5 million

commissions and expenses of approximately $ 1.2 million.

the six months ended December 31, 2022, the Company sold 5,857,613 shares of common stock under the Sales Agreement for total net

proceeds of $ 38.4 million after 3 % commissions and expenses of approximately $ 1.6 million.

Issuance of common stock through exercise of stock options and warrants

(collectively, the Agents), pursuant to which the Company may issue

and sell from time-to-time shares of the Companys common stock through the Agents, subject to the terms and conditions of the

Sales Agreement.

On April 6, 2023, the Company and B.

Riley Securities, Inc.

mutually agreed to terminate B.

Riley Securities,

Inc.’s role as a sales agent under the Sales Agreement.

During the three months ended March 31, 2023, the Company sold 1,515,078

shares of common stock under the Sales Agreement for total net proceeds of $ 9.8

million after 3 %

commissions and expenses of approximately $ 339,000 .

During the nine months ended March 31, 2023, the Company sold 7,372,691

shares of common stock under the Sales Agreement for total net proceeds of $ 48.2

million after 3 %

commissions and expenses of approximately $ 1.9

of common stock through exercise of stock options and warrants

the three months ended December 31, 2022, the Company issued 21,882 shares of common stock pursuant to a cashless exercise of stock options

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of restricted stock units for services

August 20, 2021, the Company awarded 58,759

restricted stock units (“RSUs”) to

the Company’s President and CEO under the Company’s 2019 Omnibus Incentive Equity Plan (the “2019 Omnibus Plan”)

as his salary for the period from April 27, 2021, the date of his appointment, through December 31, 2021.

The number of RSUs awarded

was based on a prorated annual base salary of $600,000 at a 10% discount to the grant date fair value of $ 7.74

per share of the Company’s common stock.

Each RSU awarded to the CEO entitled him to receive one share of common stock upon vesting.

A total of 15,339 RSUs (representing the

pro rata portion of the RSU award for the period from April 27, 2021 to June 30, 2021) vested at the grant date, 21,710 vested at September

30, 2021 and remaining 21,710 vested at December 31, 2021.

Accordingly, the CEO was issued an aggregate of 58,759 shares of common

stock over the vesting period of the RSUs.

The stock-based compensation expense related to these RSUs was $ 384,456 .

June 21, 2022, the Company awarded 124,520

RSUs to the President and CEO under the Company’s 2019 Omnibus Plan.

Each RSU awarded to the CEO entitles him to receive one share

of common stock upon vesting.

The RSUs vest in three equal annual installments over three years on the anniversary grant date.

grant date fair value was $ 1.69

per share of the Company’s common stock.

August 20, 2021, the Company awarded 58,759 restricted stock units (RSUs) to the Companys President and CEO under

the Companys 2019 Omnibus Incentive Equity Plan (the 2019 Omnibus Plan) as his salary for the period from April

27, 2021, the date of his appointment, through December 31, 2021.

The number of RSUs awarded was based on a prorated annual base salary

of $600,000 at a 10% discount to the grant date fair value of $ 7.74 per share of the Companys common stock.

Each RSU awarded to

the CEO entitled him to receive one share of common stock upon vesting.

A total of 15,339 RSUs (representing the pro rata portion of

the RSU award for the period from April 27, 2021 to June 30, 2021) vested at the grant date, 21,710 vested at September 30, 2021 and

the remaining 21,710 vested at December 31, 2021.

Accordingly, the CEO was issued an aggregate of 58,759 shares of common stock over

the vesting period of the RSUs.

The stock-based compensation expense related to these RSUs was $ 384,456 .

for the three and six months ended December 31, 2022, respectively.

November 23, 2022, the Company awarded 506,496

RSUs to certain employees and a consultant, with

a grant date fair value of $ 6.12

Twenty-five percent of these RSU vested

on the grant date and the remaining RSUs vest in three equal installments over three years beginning on the first anniversary of the

For the three months ended December 31, 2022, the stock-based compensation expense related to these RSUs was $ 584,424 .

June 21, 2022, the Company awarded 124,520 RSUs to the President and CEO under the Companys 2019 Omnibus Plan.

Each RSU awarded

to the CEO entitles him to receive one share of common stock upon vesting.

The RSUs vest in three equal annual installments over three

years on the anniversary grant date.

The grant date fair value was $ 1.69 per share of the Companys common stock.

The stock-based

compensation expense related to these RSUs was $ 17,536 and $ 52,610 for the three and nine months ended March 31, 2023, respectively.

November 23, 2022, the Company awarded 506,496 RSUs to certain employees and a consultant, with a grant date fair value of $ 6.12 per

Twenty-five percent of these RSU vested on the grant date and the remaining RSUs vest in three equal installments over three years

beginning on the first anniversary of the grant date.

For the three months ended December 31, 2022, the stock-based compensation expense

related to these RSUs was $ 584,424 .

On February 16, 2023, the Company delivered the vested portion of the RSUs and issued 72,612

shares of common stock net of 25 % withholding.

22,800 shares issued to employees were withheld in Treasury stock in exchange for payment

of withholding tax on behalf of the employees.

November 23, 2022, the Company issued equity awards for the board of directors annual compensation.

7 unchanged sentences

The equity awards vest every three months beginning from the

last annual shareholders’ meeting on November 9, 2022 on February 9, 2023, May 9, 2023, August 9, 2023 and the earlier of November

last annual shareholders meeting on November 9, 2022, on February 9, 2023, May 9, 2023, August 9, 2023 and earlier of November

9, 2023 or the next annual shareholders meeting.

While the agreements contain certain

contractual vesting terms, there are circumstances where the vesting can be accelerated that is not within the Company‘s control

and as a result, for accounting purposes, the awards are assumed to have been fully vested on the grant date, accordingly, the Company

recognized the total compensation cost of $ 1,744,192 on November 23, 2022.

While the agreements contain certain contractual vesting terms, there are circumstances

where the vesting can be accelerated that is not within the Companys control and as a result, for accounting purposes, the awards

are assumed to have been fully vested on the grant date, accordingly, the Company recognized the total compensation cost of $ 1,744,192

on November 23, 2022.

On February 9, 2023, the Company delivered the vested portion and issued 39,089 shares of common stock.

of Stock Options

August 20, 2021, the Company granted, under the 2019 Omnibus Plan, stock options to purchase 1,365,835

shares of common stock to the executive management team.

Twenty percent of the shares underlying the options awarded vested on the

grant date, and the remaining 80% will vest equally over a 5 -year

period, on the first, second, third, fourth and fifth anniversary of the grant date.

The exercise price of the options is $ 7.74

per share, the grant date fair value of the stock, and the options terminate on the earlier of the tenth anniversary of the grant

date or the date on which the options have been fully exercised.

Pursuant to a former employee Separation Agreement, dated April 11, 2022,

the Company modified a former employee’s stock option award granted on August 20, 2021 pursuant to the 2019 Omnibus Plan (“2021

Options Grant”).

Pursuant to the terms of the Separation Agreement, effective on July 8, 2022 (“the Separation Date”),

the Company accelerated the vesting of options scheduled to vest on the first and second anniversary of the grant date as deemed vested

(“Accelerated Options”) and after giving effect to the Accelerated Options, extended the exercise period of the total vested

outstanding and unexercised options (totaling 74,500 options) to one year following the Separation Date.

The unvested portion of the

2021 Option Grant (totaling 49,667 options) was canceled.

The modification was remeasured as of July 8, 2022 and the incremental difference

totaled $181,154, net credit, due to the original exercise price of $7.74 being greater than the stock price of $1.80 on the remeasurement

date, and accordingly was recognized on July 8, 2022.

December 6, 2022, the Company granted stock options to purchase 10,000 shares of common stock to a new employee.

August 20, 2021, the Company granted, under the 2019 Omnibus Plan, stock options to purchase 1,365,835 shares of common stock to the

executive management team.

Twenty percent of the shares underlying the options awarded vested on the grant date, and the remaining 80%

will vest equally over a 5 -year period, on the first, second, third, fourth and fifth anniversary of the grant date.

The exercise price

of the options is $ 7.74 per share, the grant date fair value of the stock, and the options terminate on the earlier of the tenth anniversary

of the grant date or the date on which the options have been fully exercised.

February 1, 2022, the Company granted stock options to purchase 124,167 shares of common stock to a new employee.

Twenty percent ( 20 %)

of the shares underlying the options awarded vest on the one year anniversary of the grant date, and the remaining 80% vest in equal

monthly installments over 48 month.

The exercise price is $ 5.21 per share, the grant date fair value, and the options terminate on the

tenth anniversary of the grant date.

following table summarizes warrant activity during the six months ended December 31, 2022:

of the shares underlying the options awarded vested on the grant date, and the remaining 80 % vest equally over a 5 -year period, on the

first, second, third, fourth and fifth anniversary of the grant date.

The exercise price is $ 3.20 per share, the grant date fair value,

and the options terminate on the tenth anniversary of the grant date.

the three months ended March 31, 2022, the Company granted, stock options to purchase shares of common stock totaling 273,167 to four

new employees.

to a former employee Separation Agreement, dated April 11, 2022, the Company modified a former employees stock option award granted

on August 20, 2021, pursuant to the 2019 Omnibus Plan (2021 Options Grant).

Pursuant to the terms of the Separation Agreement,

effective on July 8, 2022 (the Separation Date), the Company accelerated the vesting of options scheduled to vest on the

first and second anniversary of the grant date as deemed vested (Accelerated Options) and after giving effect to the Accelerated

Options, extended the exercise period of the total vested outstanding and unexercised options (totaling 74,500 options) to one year following

the Separation Date.

The unvested portion of the 2021 Option Grant (totaling 49,667 options) was canceled.

The modification was remeasured

as of July 8, 2022, and the incremental difference totaled $181,154, net credit, due to the original exercise price of $7.74 being greater

than the stock price of $1.80 on the remeasurement date, and accordingly was recognized on July 8, 2022.

December 6, 2022, stock options to purchase 10,000 shares of common stock were granted to new employees as part of their compensation

Twenty percent (20%) of the shares underlying the options awarded vest on the one-year anniversary of the grant date, and the

remaining 80% vest in equal monthly installments over 48 months.

The exercise price is $ 5.21 per share, the grant date fair value, and

the options terminate on the tenth anniversary of the grant date.

April 4, 2023, stock options to purchase 124,167 shares of common stock were granted to new employees as part of their compensation package.

Twenty percent ( 20 %) of the shares underlying the options awarded vest on the one-year anniversary of the grant date, and the remaining

80 % vest in equal monthly installments over 48 months.

The exercise price is $7.36 per share, the grant date fair value, and the options

terminate on the tenth anniversary of the grant date.

following table summarizes warrant activity during the nine months ended March 31, 2023:

Summary of warrants activity

4 unchanged sentences

Outstanding and exercisable at June 30, 2022

Outstanding and exercisable at December 31, 2022

Outstanding and exercisable at March 31, 2023

the above warrants, 101,380 expire in the fiscal year ending June 30, 2025, 35,175 expire in the fiscal year ending June 30, 2026, and

8 unchanged sentences

three percent.

operating lease cost recognized in our statement of operations was approximately $ 13,000 and $ 27,700 for the three months ended December

operating lease costs recognized in our statement of operations were approximately $ 13,000 and $ 23,000 for the three months ended March

31, 2023, and 2022, respectively;

The operating lease cost recognized in our statement of operations was approximately $ 25,900 and

$ 53,100 for the six months ended December 31, 2022 and 2021, respectively.

following table provides balance sheet information related to leases as of December 31, 2022 and June 30, 2022:

and approximately $ 36,900 and $ 76,500 for the nine months ended March 31, 2023 and 2022, respectively.

following table provides balance sheet information related to leases as of March 31, 2023 and June 30, 2022:

Schedule of balance sheet information related to leases

March 31, 2023

June 30, 2022

Operating lease, right-of-use asset, net

2 unchanged sentences

Total operating lease liabilities

December 31, 2022, the future estimated minimum lease payments under non-cancelable operating leases are as follows:

March 31, 2023, the future estimated minimum lease payments under non-cancelable operating leases are as follows:

Schedule of future estimated minimum lease payments under non-cancelable operating leases

Year ending June 30, 2023 (Remaining 3 months)

Toal minimum lease payments

Total minimum lease payments

Less amount representing interest

Present value of future minimum lease payments

Less currrent portion of operating lease liabilities

Less current portion of operating lease liabilities

Operating lease liabilities, net of current portion

weighted average remaining lease term and discount rate as of December 31, 2022 and June 30, 2022 were as follows:

cash paid for amounts included in the measurement of lease liabilities were $ 12,650 and $ 37,700 for the three and nine months ended March 31, 2023, respectively.

weighted average remaining lease term and discount rate as of March 31, 2023 and June 30, 2022 were as follows:

Schedule of weighted average remaining lease term and discount rate

March 31, 2023

June 30, 2022

Weighted average remaining lease term (Years)

3 unchanged sentences

and Contingencies

Pursuant to the Agreement and Plan of Merger entered into on April 11,

2016, by and between our predecessor entities, LAT Pharma and NanoAntibiotics, Inc., the Company is obligated to pay a low single digit

royalty on net sales of BIV201 (continuous infusion terlipressin) to be shared by the members of LAT Pharma Members, PharmaIn Corporation,

and The Barrett Edge, Inc.

Pursuant to the Technology Transfer Agreement entered into on July 25,

2016, by and between the Company and the University of Padova (Italy), the Company is obligated to pay a low single digit royalty on

net sales of all terlipressin products covered by US patent no.

9,655,645 and any future foreign issuances, capped at a maximum of $200,000

On August 1, 2021, the Company began sponsoring an employee benefit plan

subject to Section 401(K) of the Internal Revenue Service Code (the “401K Plan”).

to the Agreement and Plan of Merger entered into on April 11, 2016, by and between our predecessor entities, LAT Pharma and NanoAntibiotics,

Inc., the Company is obligated to pay a low single digit royalty on net sales of BIV201 (continuous infusion terlipressin) to be shared

by the members of LAT Pharma Members, PharmaIn Corporation, and The Barrett Edge, Inc.

to the Technology Transfer Agreement entered into on July 25, 2016, by and between the Company and the University of Padova (Italy),

the Company is obligated to pay a low single digit royalty on net sales of all terlipressin products covered by US patent no.

and any future foreign issuances, capped at a maximum of $200,000 per year.

August 1, 2021, the Company began sponsoring an employee benefit plan subject to Section 401(K) of the Internal Revenue Service Code

(the 401K Plan).

to certain limitations in the Internal Revenue Code, eligible employees are permitted to make contributions to the 401K Plan on a pre-tax

salary reduction basis and the Company will match 5% of the first 5% of an employee’s contributions to the 401K Plan.

For the three

months ended December 31, 2022 and 2021, the Company made contributions of approximately $ 19,000 and $ 23,000 , respectively.

months ended December 31, 2022 and 2021, the Company made contributions of approximately $ 64,192 and $ 46,600 , respectively.

January 2023, the Company sold 483,036

shares of common stock for net proceeds of $ 2.9

million net of 3% commission and expenses totaling

approximately $ 90,000

under the Sales Agreement with the Agents.

salary reduction basis and the Company will match 5% of the first 5% of an employees contributions to the 401K Plan., The Company

made contributions of approximately $ 16,000 and $ 28,700 , for the three months ended March 31, 2023 and 2022, respectively and approximately

$ 80,100 and $ 75,100 , for the nine months ended March 31, 2023 and 2022, respectively.

to March 31, 2023 the Company sold 162,767

shares of common stock for net proceeds of $ 1.3 million

net of 3% commission and expenses totaling approximately $ 40,000

under the Sales Agreement with the Agent.

Managements Discussion and Analysis of Financial Condition and Results of Operations

report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and

Section 27A of the Securities Act of 1933, as amended.

Any statements contained in this report that are not statements of historical

fact may be forward-looking statements.

When we use the words intends, estimates, predicts,

potential, continues, anticipates, plans, expects, believes,

should, could, may, will or the negative of these terms or other comparable terminology,

we are identifying forward-looking statements.

Forward-looking statements involve risks and uncertainties, which may cause our actual

results, performance or achievements to be materially different from those expressed or implied by forward-looking statements.

factors include, among others:

our research and development activities and distributor channel;

compliance with regulatory requirements;

and our ability to satisfy our capital needs Although we believe that the expectations reflected in the forward-looking statements are

reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

are cautioned not to place undue reliance on the forward-looking statements in this report, which speak only as of the date of this report.

Except as may be required by applicable law, we do not undertake or intend to update or revise our forward-looking statements, and we

assume no obligation to update any forward-looking statements contained in this report as a result of new information or future events

or developments, except as required by law.

Thus, you should not assume that our silence over time means that actual events are bearing

out as expressed or implied in such forward-looking statements.

You should carefully review and consider the various disclosures we make

in this report and our other reports filed with the Securities and Exchange Commission (the SEC) that attempt to advise

interested parties of the risks, uncertainties and other factors that may affect our business.

following discussion of the Companys financial condition and the results of operations should be read in conjunction with the

Financial Statements and Notes thereto appearing elsewhere in this report.

(the Company or we or our) is a clinical-stage company developing innovative drug therapies

to treat chronic debilitating conditions including neurological and neuro-degenerative disorders and liver disease.

Company acquired the biopharmaceutical assets of NeurMedix, Inc.

(NeurMedix), a privately held clinical-stage pharmaceutical

company, in June 2021 (See Note 5 Related Party Transactions ).

The acquired assets included NE3107, a potentially selective inhibitor

of inflammatory extracellular single-regulated kinase(ERK) signaling that, based on animal studies, is believed to reduce

neuroinflammation.

NE3107 is a novel orally administered small molecule that is thought to inhibit inflammation-driven insulin resistance

and major pathological inflammatory cascades with a novel mechanism of action.

There is emerging scientific consensus that both inflammation

and insulin resistance may play fundamental roles in the development of Alzheimers Disease (AD) and Parkinsons Disease

(PD), and NE3107 could, if approved represent an entirely new medical approach to treating these devastating conditions affecting an

estimated 6 million Americans suffering from AD and 1 million Americans suffering from PD.

In August 2021, the Company initiated the

FDA authorized potentially pivotal Phase 3 randomized, double-blind, placebo-controlled, parallel group, multicenter study to evaluate

NE3107 in subjects who have mild to moderate AD (NCT04669028).

The Company is targeting primary completion of this study in the fourth

quarter of calendar year 2023.

Phase 2 study of NE3107 in Parkinsons disease (PD (NCT05083260), completed in December was a double-blind, placebo-controlled,

safety, tolerability, and pharmacokinetics study in PD participants treated with carbidopa/levodopa and NE3107.

45 patients with a defined

L-dopa off state were randomized 1:1 to placebo:NE3107 20 mg twice daily for 28 days.

This trial was launched with two

design objectives:

1) the primary objectives are safety and a drug-drug interaction study as requested by the FDA to demonstrate the

absence of adverse interactions of NE3107 with levodopa;

and 2) the secondary objective is to determine if preclinical indications of

promotoric activity and apparent enhancement of levodopa activity can be seen in humans.

Both objectives were met.

The Company continues

to process its findings from its completed NM201 study as it prepares for the next round of clinical studies in PD.

Neuroinflammation,

insulin resistance, and oxidative stress are common features in the major neurodegenerative diseases, including AD, PD, frontotemporal

lobar dementia, and Amyotrophic lateral sclerosis (ALS).

NE3107 is an oral small molecule, blood-brain permeable, compound with potential

anti-inflammatory, insulin sensitizing, and ERK-binding properties that may allow it to selectively inhibit ERK-, NFκB- and TNF-stimulated

inflammation.

NE3107s potential to inhibit neuroinflammation and insulin resistance forms the basis for the Companys work

testing the molecule in AD and PD patients.

NE3107 is patented in the United States, Australia, Canada, Europe and South Korea.

Companys Orphan drug candidate BIV201 (continuous infusion terlipressin), with FDA Fast Track status, that is being evaluated

in a US Phase 2b study for the treatment of refractory ascites due to liver cirrhosis was paused in March 2023.

Data from the first

15 patients treated with BIV201 plus standard of care (SOC) resulted in a 34% reduction in ascites fluid during the 28 days after

treatment initiation compared to the 28 days prior to treatment (p=0.0046).

This improvement was significantly different from those

treated with SOC only who experienced a mean increase in ascites fluid of 3.1% (BIV201 vs.

Patients who completed the

treatment with BIV201 experienced a 53% reduction in ascites fluid (p=0.001), which was significantly different from those treated

with SOC (p=0.007).

This improvement was sustained in this group during the 3 months after treatment initiation as compared to the

3-month pre-treatment period (43% reduction, p=0.06).

Overall treatment appeared to be well tolerated.

There were no unexpected

serious adverse events and overall safety was consistent with the patient population.

The current trial (NCT04112199) evaluates the

efficacy of BIV201 combined with SOC, compared to SOC alone, for the treatment of refractory ascites.

Terlipressin was administered with a continuous low dose infusion via a portable pump in two 28-day treatment cycles.

endpoints are the incidence of complications of at least Grade 2 severity, and the change in cumulative ascites in the 12-week

period following randomization compared to a 12-week pre-treatment period.

The BIV201 trial planned to enroll 30 patients to be

treated in the home care setting.

The active agent is approved in the U.S.

and in about 40 countries for related complications of

advanced liver cirrhosis.

of the three months ended March 31, 2023 to the three months ended March 31, 2022

The net loss for the three months ended March 31, 2023, was approximately

$15.0 million as compared to $7.0 million for the three months ended March 31, 2022.

The increase in net loss of approximately $8.0 million

was primarily due to increased operating expenses primarily attributed to increased clinical activities.

operating expenses for the three months ended March 31, 2023, were approximately $13.8 million as compared to $5.7 million for the three

months ended March 31, 2022.

The net increase of approximately $8.1 million for the three months ended March 31, 2023 was

due to an increase in research and development expenses of approximately $7.6 million due to increased clinical activities and an increase

in selling general and administrative expenses of approximately $406,000.

and Development Expenses

and development expenses were approximately $11.2 million and $3.6 million for the three months ended March 31, 2023, and 2022,

respectively.

The net increase of approximately $7.6 million, was comprised of an increase in clinical study activities of

approximately $7.1 million, and an increase in the clinical team and consultants’ compensation expense of approximately

$676,000 to support such increased clinical activities over the three months ended March 31, 2022, offset by Chemistry,

Manufacturing and Control expenses of approximately $188,000 and other research of $122,000.

increase in research and development expenses of approximately $6.7 million was primarily due to the Neuroscience NE3107 studies,

which were significantly more active during the three months ended March 31, 2023, compared to the three months ended March 31,

The Parkinsons Phase 2 study initiated in January 2022 reported top results and the Alzheimer Phase 3 study reached full

Our Orphan drug candidate BIV201s Phase 2b study, which was initiated in June 2021, accounted for approximately

$124,000 of the net increase in research and development expenses for three months ended March 31, 2023.

General and Administrative Expenses

general and administrative expenses were approximately $2.5 million and $2.1 million for the three months ended March 31, 2023, and 2022,

respectively.

The net increase of approximately $400,000 was primarily attributed to increased legal fees of $156,000 and other business

development and promotions of approximately $100,000 and an increase in compensation expense of approximately $129,000.

Income and Expense

expense, net was $1.3 million for the three months ended March 31, 2023 was comparable to other expense, net of $1.3 million for the three

months ended March 31, 2022.

Other expense, net was comprised of the change in fair value of the derivative liabilities which totaled

$366,000 and $386,000 and net interest expense of approximately $1.1 million and $918,000 for the three months ended March 31, 2023,

and 2022, respectively.

of the nine months ended March 31, 2023, to the nine months ended March 31, 2022

The net loss for the nine months ended March 31, 2023, was approximately

$41.1 million as compared to $18.0 million for the nine months ended March 31, 2022.

The increase in net loss of approximately $23.1 million

was primarily due to increased administrative expenses of approximately $2.5 million, increased clinical activities of approximately $13.5

million, an increase in other expense of approximately $7.0 million primarily attributed to the change in fair value of derivative liabilities

of approximately $5.3 million.

operating expenses for the nine months ended March 31, 2023, were approximately $34.1 million as compared to $18.0 million for the nine

months ended March 31, 2022.

The net increase of approximately $16.1 million during the nine months ended March 31, 2023,

was due to an increase in research and development expenses of approximately $13.6 million due to our increased clinical activities,

and an increase in selling general and administrative expenses of approximately $2.5 million.

and Development Expenses

and development expenses were approximately $25.0 million and $11.4 million for the nine months ended March 31, 2023, and 2022, respectively.

The net increase of approximately $13.6 million, was comprised of a net increase of $12.3 million from increased clinical activities,

offset by a decline in other development activities of approximately $354,000 an increase in Chemistry, Manufacturing and Control expense

of approximately $237,000, and an increase in clinical promotion and publications of approximately $237,000 and an increase compensation

expense of approximately $557,000 for the clinical team and consultants.

increase in research and development expenses of approximately $12.3 million was primarily due to the Neuroscience NE3107 studies, which were

significantly more active during the nine months ended March 31, 2023 compared to the nine months ended March 31, 2022.

The Parkinsons

Phase 2 study initiated in January 2022, reported its top-line data results, and the Alzheimer Phase 3 study is reached full enrollment.

Our Orphan drug candidate BIV201s Phase 2b study, which was initiated in June 2021, accounted for approximately $63,000 of the

net increase in research and development expenses for nine months ended March 31, 2023.

General and Administrative Expenses

general and administrative expenses were approximately $8.9 million and $6.4 million for the nine months ended March 31, 2023, and 2022,

respectively.

The net increase of approximately $2.5 million was primarily attributed to increased stock compensation expense of approximately

$2.0 million related to the board of directors annual compensation;

a net increase in legal, investor relations and other professional

fees totaling approximately $787,000, offset by decreased management compensation expense of approximately $198,000.

Income and Expense

Other expense, net was

$7.0 million compared to other expense, net of $35,000, for the nine months ended March 31, 2023 and 2022, respectively.

increase in other expenses of $7.0 million represented an increase in interest expense of approximately $2.0 million and the

change in fair value of the related derivative liabilities of approximately $5.3 million.

Resources and Liquidity

of March 31, 2023, the Company had cash and cash equivalents and US treasury bills totaling of approximately $43.8 million, working

capital of approximately $28.0 million, stockholders equity of approximately $21.7 million, and an accumulated deficit of

approximately $292.1 million.

In the three months ended March 31, 2023, the Company sold approximately 1.5 million shares of its

common stock under its Controlled Equity Offering Sales Agreement with Cantor Fitzgerald & Co for

total net proceeds of approximately $9.8 million after 3% commissions and cost totaling approximately $339,000.

Company has not generated any revenue and no revenues are expected in the foreseeable future.

The Companys future operations are

dependent on the success of the Companys ongoing development and commercialization efforts, as well as its ability to secure additional

Management expects that future sources of funding may include sales of equity, obtaining loans, or other strategic

transactions.

duration and spread of the COVID-19 pandemic and the long-term impact of COVID-19 and any variants on the financial markets and the overall

economy continue to be uncertain and cannot be predicted at this time.

If the financial markets and/or the overall economy are impacted

for an extended period, the Companys ability to raise funds may be materially adversely affected.

management continues to pursue the Companys strategic plans, there is no assurance that the Company will be successful in obtaining

sufficient financing on terms acceptable to the Company, if at all, to fund continuing operations.

These circumstances raise substantial

doubt on the Companys ability to continue as a going concern.

The financial statements do not include any adjustments that might

result from the outcome of this uncertainty.

Accounting Policies and Estimates

the nine-month period ended March 31, 2023, there were no significant changes to the Companys critical accounting policies as

identified in the Annual Report Form 10-K for the fiscal year ended June 30, 2022.

Accounting Pronouncements

Company considered the applicability and impact of recent accounting pronouncements and determined those to be either not applicable

or expected to have minimal impact on our balance sheets or statement of operations.

Quantitative and Qualitative Disclosures About Market Risk

applicable to smaller reporting companies.

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

What changed 10-Q

Item 1. Financial Statements