What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-03-30 compared with 2022-03-31 · 550 added, 508 removed, 868 unchanged (55% of the section changed)

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part of the transaction, LACQ changed its name to “Ensysce Biosciences, Inc.” and Former Ensysce changed its name to EBI

(the “ Merger ”).

mailing address of our principal executive office is 7946 Ivanhoe Avenue, Suite 201, La Jolla, California 92037.

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updates to the list of disclosure channels through which we will announce information will be posted on the investor relations page on

are a clinical stage pharmaceutical company seeking to develop innovative solutions for severe pain relief while reducing the fear of

and the potential for misuse, abuse, and overdose.

We have also incorporated a 79.2%-owned subsidiary, Covistat, a clinical stage pharmaceutical

company that is developing a compound utilized in our overdose protection program for the treatment of COVID-19 and cystic fibrosis.

Certain of our affiliates own the remaining portions of Covistat.

See “ Certain Relationships and Related Person Transactions ”

for additional information.

are currently developing product candidates designed to improve the safety and performance of prescription drugs.

Our primary focus has

been on opioid pain products and opioid use disorder products.

Prescription opioid abuse and addiction present major burdens to society,

resulting in significant costs, illnesses, and deaths, many of which we believe could be prevented through the use of our proprietary

technologies.

We believe the intertwined issues of (1) the widespread abuse of prescription opioids and (2) the resultant reluctance

of many prescribers to write prescriptions for opioid analgesics, have resulted in the persistent under-treatment of patients with moderate-to-severe

Our platforms utilize a novel molecular delivery technology designed to deter prescription opioid abuse at the molecular level.

are a clinical stage pharmaceutical company seeking to develop innovative solutions for severe pain relief while reducing the potential

for opioid misuse, abuse, and overdose.

are currently developing product candidates designed to improve the safety of prescription drugs.

Our primary focus has been on opioid

pain products and opioid use disorder products.

Prescription opioid abuse presents major burdens to society, resulting in significant

costs, illnesses, and deaths, many of which we believe could be prevented through the use of our proprietary technologies.

the intertwined issues of (1) the widespread abuse of prescription opioids and (2) the resultant reluctance of many prescribers to write

prescriptions for opioid analgesics have resulted in the persistent under-treatment of patients with moderate-to-severe pain.

Our platforms

utilize a novel molecular delivery technology designed to deter prescription opioid abuse at the molecular level.

current development pipeline includes two new drug platforms - an abuse-resistant opioid prodrug technology – the Trypsin

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or the MPAR™ platform.

The TAAP platform is designed to seek to improve the care of patients with moderate to severe acute or chronic

pain while reducing the human and economic costs associated with prescription opioid drug abuse.

Our development pipeline of TAAP prodrugs

is summarized in the table below.

The MPAR™ platform when combined with our TAAP prodrugs is designed not only to seek to prevent

abuse of prescription drugs but also to reduce overdose occurrences.

Each prodrug is intended to be able to be combined with our MPAR™

technology for overdose protection.

Additionally, nafamostat di-mesylate (“ nafamostat ”), which is an ingredient in

our overdose protection combination products, is also being developed for the intended purpose of treating infection and pulmonary lung

The TAAP platform is designed to seek to improve the care of patients with chronic pain while reducing the

human and economic costs associated with prescription opioid drug abuse.The MPAR™ platform when combined with our TAAP prodrugs

is designed not only to seek to prevent abuse of prescription drugs but also to reduce overdose occurrences.

Each prodrug is intended

to be able to be combined with our MPAR™ technology for overdose protection.

Additionally, nafamostat di-mesylate (“ nafamostat ”),

which is an ingredient in our overdose protection combination products, is also being developed for the intended purpose of treating

infection and pulmonary lung diseases.

technology under the TAAP platform when applied to opioid drugs is designed to release clinically effective opioid drugs only when exposed

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which uses DETERx™ (insoluble fatty acid salts in polymers), in a number of ways.

the TAAP technology seeks to remove the ability of a user to abuse PF614 intravenously or intra-nasally.

This is based on preclinical

studies that show PF614 does not readily convert into oxycodone in the blood stream and trypsin is not present in the nasal passage.

Accordingly, PF614 would not convert to oxycodone in the nose.

Furthermore, the chemically modified and abuse-resistance TAAP opioid

drug is unaffected by simple physical manipulations designed to extract abusable amounts of opioid, such as through kitchen chemistry.

portfolio of TAAP product candidates is based on a differentiated understanding of chemical reactivity and metabolism, as well as the

key pillars of our unique approach which focuses on:

(1) enzyme mediated metabolic activation localized in the gastrointestinal tract;

(2) rearrangement chemistry to achieve ideal pharmacokinetic release of active drug products;

and (3) robust packages of preclinical

data that set forth the metabolic and chemical activation profile for each of our clinical candidates.

This approach led to the filing

of an Investigational New Drug application, or IND (116794), and a Phase 1 clinical trial for PF614, which was completed in February

In addition, the clinical data from the Phase 1 trial demonstrated that oxycodone is released from PF614 as chemically designed,

and that it was absorbed following oral administration of the TAAP PF614, given blood levels that matched the same release profile as

the extended release oxycodone product, OxyContin OP.

MPAR™ technology is a combination of TAAP prodrug and trypsin inhibitor nafamostat.

It is designed to provide overdose protection

to all TAAP prodrugs.

MPAR™ applied to TAAP opioids enables the release of active opioid following ingestion of multiple doses,

whether inadvertent or intentional.

Nafamostat is a small molecule, highly potent protease inhibitor (trypsin inhibitor) with a steep

dose response curve.

MPAR™ at prescribed doses is designed to release of the active pharmaceutical ingredient.

However, if the

TAAP prodrug nafamostat combination (MPAR™) is taken in larger quantities than intended, the excess nafamostat is present to inhibit

trypsin, thereby preventing metabolic activation of TAAP and averting a drug overdose.

We believe the potential benefits to society of

an opioid that resists both oral and parenteral abuse are considerable.

pipeline, developed over the course of 15 years of research and investment, includes three clinical-stage product candidates.

principal focus and lead product candidates are geared towards combating abuse and overdose of opioid drugs, we have, over the years

of research and development, discovered and recognized qualities and unique features of certain product candidates that may be useful

in addressing other treatments.

For example, we discovered the ability of nafamostat in inhibiting the action of enzymes associated with

the COVID-19 infection, and, as such, have devoted efforts to develop an oral and inhalation drug product of nafamostat, for use against

coronaviral infections and other pulmonary diseases such as cystic fibrosis.

First, the TAAP technology seeks to remove the

ability of a user to abuse PF614 intravenously or intranasally based on preclinical studies that show PF614 does not readily convert

into oxycodone in the blood stream and trypsin is not present in the nasal passage, and, accordingly, PF614 would not convert to oxycodone

Furthermore, the chemically modified and abuse-resistance TAAP opioid drug is unaffected by simple physical manipulations

designed to extract abusable amounts of opioid, such as through kitchen chemistry.

Our portfolio of TAAP product candidates is based

on a differentiated understanding of chemical reactivity and metabolism, as well as the key pillars of our unique approach which focuses

(1) enzyme mediated metabolic activation localized in the gastrointestinal track;

(2) rearrangement chemistry to achieve pharmacokinetic

release of active drug products;

and (3) preclinical and clinical data that set forth the metabolic and chemical activation profile for

each of our clinical candidates.

this approach, we filed an Investigational New Drug application, or IND (116794), and commenced a Phase 1 clinical trial for PF614, which

was completed in February 2018.

The clinical data from the Phase 1 trial demonstrated that oxycodone released from PF614 as chemically-designed,

and that it was absorbed following oral administration of the TAAP PF614, resulting in blood levels that matched the same release profile

as the extended release oxycodone product, OxyContin OP.

A second multi-ascending dose study with a bioequivalent arm was completed in

July 2022 and a nasal human abuse potential (HAP) study was completed in October 2022.

A second oral HAP study has been initiated in

September 2022 and data is expected in early 2023.

MPAR™ technology is designed to limit the bioavailability of active opioid following co-ingestion of multiple doses, whether inadvertent

or intentional, through a combination of a TAAP prodrug with nafamostat.

Nafamostat is a small molecule that clinical studies have shown

to have a steep dose response curve and to be a highly potent trypsin inhibitor.

When combined with our TAAP prodrugs, our MPAR technology

is designed not to affect metabolism and the release of the active pharmaceutical ingredient.

However, if the MPAR combination product

is taken in larger quantities than intended, the excess nafamostat is designed to inhibit trypsin, thereby preventing metabolic activation

and averting a drug overdose.

We believe the potential benefits to society of an opioid that resists both oral and parenteral abuse are

considerable.

A Phase 1 study to explore the combination of PF614 and nafamostat, PF614-MPAR-101 was initiated in December of 2021, and

early data from the study reported in May 2022 demonstrated the combination product showed overdose protection, with a reduction in the

release of oxycodone over that of PF614 delivered alone.

pipeline has been developed over the course of 15 years of research and investment and includes three clinical-stage product candidates.

While our principal focus and lead product candidates are geared towards combating abuse and overdose of opioid drugs, we have, over

the years of research and development, discovered and recognized qualities and unique features of certain product candidates that may

be useful in addressing other treatments.

For example, we discovered the ability of nafamostat in inhibiting the action of enzymes associated

with the COVID-19 infection, and, as such, have devoted efforts to develop an oral and inhalation drug product of nafamostat, for use

against coronaviral infections and other pulmonary diseases such as cystic fibrosis.

is our lead TAAP prodrug candidate under development for the treatment of acute or chronic pain.

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oxycodone at 4 to 6 hours after swallowing PF614, demonstrating its delayed release profile.

A second Phase 1b study was initiated in

2021 to evaluate PF614 delivered to healthy subjects twice daily for 4.5 days.

This study evaluated both safety and PK, with a second

part to evaluate the bioequivalence of PF614 versus OxyContin.

Final data from this trial will be available in the second quarter of

A second Phase 1b multi-ascending dose study

(MAD) was initiated in 2021 to evaluate PF614 delivered to healthy subjects twice daily for 4.5 days.

This study evaluated both safety

and PK, with a second part to evaluate the bioequivalence (BE) of PF614 versus OxyContin.

Final data from this trial was reported in

The MAD study demonstrated both the safety of PF614 showing it was well tolerated at doses up to 200 mg, which was comparable

to 80 mg of OxyContin both delivered twice daily.

The BE study arm followed the successful completion of the multi-ascending twice-daily

dosing study of PF614 and compared the release of oxycodone from PF614 versus OxyContin® administered to subjects in both fasted

and fed states.

It was concluded that 100 mg PF614 was bioequivalent to 40 mg OxyContin under both fasted and fed conditions.

is critical to understand future prescribing criteria for PF614 as an agent bioequivalent to OxyContin and therefore may be developed

through the 505(b)(2) regulatory path as defined by the FDA.

The intranasal (IN) and oral human abuse potential of PF614 was assessed

in two different studies.

In study 1 PF614-103, we evaluated the abuse potential of PF614 100 mg relative to crushed oxycodone immediate-release

(IR) tablets 40 mg (equivalent opioid doses) and placebo following intranasal administration.

In study 2, PF614-104 which is ongoing,

we are evaluating the oral abuse potential of intact PF614 at 3 different dose levels 50, 100 and 200 mg to IR oxycodone 40 mg and placebo.

The purpose of this study is to assess the pharmacokinetics (PK) and human abuse potential of oral PF614 and data is expected is 2023.

We believe PF614 has the potential to provide a safer alternative to the abuse deterrent formulated opioid products that are currently

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Our IND application (150966) for PF614-MPAR™

received FDA allowance and we initiated a Phase 1 clinical trial to evaluate safety and PK in healthy subjects in December 2021.

from this trial will be available in the second half of 2022.

received FDA allowance on April 27, 2021 following the release of a Full Clinical Hold from January 8, 2021.

We addressed deficiencies

from the initial IND submission, amended the protocol and submitted a response to the clinical hold letter on March 29, 2021.

a Phase 1 clinical trial, PF614-MPAR-101, to evaluate safety and PK in healthy subjects in December 2021.

Initial data from this trial

was reported in May of 2022.

The PF614-MPAR-101 overdose protection study examined PF614 administered orally alone or in combination

with the trypsin inhibitor nafamostat (MPAR) to healthy volunteers.

The initial data demonstrated the overdose protection of our MPAR

combination product, with reduced release of oxycodone from PF614 in a simulated overdose situation.

It also demonstrated the PF614 in

the systemic circulation (simulated injection) did not convert to oxycodone.

We completed the clinical portion and reported data from

Part A of this study in December 2022.

The study will continue in 2023 to test the overdose protection of the selected formulation by

administering an escalating number of dose units to a group of healthy subjects.

Data is expected in the second half of 2023.

is being tested clinically in partnership with Quotient Sciences, using its integrated Translational Pharmaceutics® platform to search

for a PF614-MPAR formulation that allows conversion into oxycodone within the prescribed dose range but reduces conversion to oxycodone

at higher than prescribed dose levels in an overdose scenario.

is an enzyme inhibitor (protease inhibitor) used in our combination overdose protection technology, MPAR™.

Due to its ability to

inhibit the action of enzymes associated with the COVID-19 infection, we are also developing an oral and inhalation drug product for

inhibit the action of enzymes associated with the COVID-19 infection, we are also developing an oral drug product of nafamostat, for

use against coronaviral infections and other pulmonary diseases such as cystic fibrosis.

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A Phase 1 trial to evaluate safety and PK was completed in 2021.

intend to undertake additional clinical studies in 2022.

Two human abuse liability studies of PF614 will be initiated in the second and

third quarter of 2022 to understand the tendency for drug abusers to like the effects achieved from taking PF614 either orally or nasally

as compared to that of a comparator product such as crushed OxyContin.

We are also exploring pain indications to evaluate PF614 for efficacy

and safety which we are seeking to initiate by end of 2022.

We are also planning to evaluate nafamostat in COVID-19 subjects when delivered

as an oral drug product.

The ability to undertake these studies will depend on additional financing.

We have funded our operations to

date primarily with proceeds from the sale of equity and borrowings under convertible promissory notes and federal grants.

See “Convertible

Promissory Notes” and “ Government Grants ” for additional information.

seek to become a leading specialty pharmaceutical company focused on addressing the safe use of pharmaceuticals by developing a broad

portfolio of TAAP and MPAR™ products with enhanced safety features and benefits.

Specifically, we intend to:

on our management team’s collective experience and expertise in the development and approval process of innovative drug delivery

technologies that address medication safety .

We have received fast track designation for PF614, our lead drug candidate, from

However, fast track designation does not guaranty a faster development or regulatory review or approval process and does

not assure FDA approval.

We are currently devoting our efforts to develop PF614 for the severe pain market with acute and chronic

pain indications, while bringing other TAAP and MPAR™ products through regulatory approval with the expertise of team members

who have launched a number of products in the central nervous system, or CNS, space.

our proprietary technologies to develop a full line of pharmaceutical products.

Medication abuse and misuse is not limited to

single drugs but often pervades entire drug categories.

We have initiated programs to apply our TAAP and MPAR™ technology to

other categories of prescription drugs such as amphetamine and methadone.

Commercialize

our products through focus on the United States market to commercialize our lead products while licensing our technology internationally

and through patent life extension .

We intend to bring PF614 and PF614-MPAR™ through regulatory approval to commercialization

in the United States.

We expect to seek licensing partners in jurisdictions outside the United States for our product candidates.

We also expect to seek partners who wish to license our TAAP and MPAR™ technologies for patent life extension of their portfolio

products, or to improve delivery or pharmacokinetic properties of certain of their drug candidates.

an efficient internal cost structure .

Our internal cost structure has been designed to enable us to focus on our lead drug products,

PF614, PF614-MPAR™, and nafamostat oral and inhalation drug products clinically through to commercialization.

many high-cost elements of development such as clinical trials.

Outsourcing these functions minimizes our fixed overhead without

reliance or dependence on individual third parties, and capital investment and thereby reduce our business risk in our view.

seek to achieve our strategic goals through the utilization of our key competitive strengths, including:

worldwide patent portfolio has extensive coverage in major markets and coverage in select secondary markets.

These patents provide

protection to the underlying molecules of both our immediate and extended-release drug candidates.

We expect our patent portfolio

will continue to expand and deepen as new products are developed and new markets are identified.

Our lead product candidates

are new chemical entities and not simply re-formulations.

Our TAAP prodrugs have a unique technology that has been demonstrated in

our Phase 1 clinical trials for PF614.

of our leadership team in all stages of discovery, development, marketing, and business development.

Our team has successfully

developed and launched many successful products with multi-billion dollar selling market leaders in the CNS area.

track designation .

Our lead clinical candidate, PF614, has received fast track designation from the FDA.

Federal grants from Federal agencies including NIDA, NIH.

We have received two large Federal government grants to support our

MPAR™ overdose protection program and our opioid use disorder program from NIH/NIDA.

proof of concept.

We have conducted a Phase 1 trial with TAAP prodrug PF614.

The trial demonstrated that, after oral administration

of the TAAP prodrug, the corresponding opioid was measured in the subjects’ blood.

Abuse and Drug Overdose

pain medications are essential for improving the care and outcomes of a majority of Americans who live with chronic pain.

study reported that 25.3 million adults suffered from pain every day for the preceding three months and almost 40 million adults experience

severe levels of pain, which is linked to worse health status.

Prescription opioids drugs, such as morphine, hydromorphone, hydrocodone,

and oxycodone, have a long history of use for the management of patient pain.

Prescriptions for opioid medications in 2020 totaled 153

million, with $4.2 billion in market size in the United States, where 80% of world’s opioids are consumed.

An NIH study,

updated September 2018, reported that 25.3 million adults suffered from pain every day for the preceding three months and almost 40 million

adults experience severe levels of pain, which is linked to worse health status.

High impact chronic pain affects over 10 million Americans

and is characterized by extended periods of suffering which impair life quality to a severe degree.

Prescription opioids drugs, such

as morphine, hydromorphone, hydrocodone, and oxycodone, have a long history of use for the management of severe and chronic pain.

Prescriptions

for opioid medications in 2021 totaled 153 million, with $4.2 billion in market size in the United States.

CDC recently provided recommendations for clinicians who provide pain care, defining acute pain (duration less than 1 month), subacute

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cancer pain treatment, palliative care, and end-of life care .

These guidelines provide the market indications, acute and chronic,

that Ensysce will explore for its TAAP and MPAR™ opioid products including PF614.

These guidelines are based on the indications, acute and chronic

pain, that we intend to explore for our TAAP and MPAR™ opioid products including PF614.

are offered in a variety of dosages including immediate-release tablets (or capsules), extended-release tablets (or capsules), patches,

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and focus on his or her work.

Opioids have an increased risk of dependence and, when used improperly, a common side effect of high doses

of opioids like oxycodone can be euphoria, or a “high.” As a result of these side effects, opioids have become amongst the

most misused or abused prescription drugs in the United States.

Opioid abuse was declared a public-health emergency in 2017 when more

than 130 people died each day from opioid-related overdoses.

Currently, that number has risen to over 200 deaths per day.

Opioids have a risk of dependence and, when used improperly, a common side effect of high doses of opioids

like oxycodone can be euphoria, or a “high.” As a result of these side effects, opioids have become amongst the most misused

or abused prescription drugs in the United States.

Opioid abuse was declared a public-health emergency in 2017 when more than 91 people

died each day from opioid-related overdoses.

Currently, that number has risen to approximately 188 deaths per day.

large increase in overall overdose deaths is now driven by use of synthetic opioids, in particular fentanyl, as prescription opioids

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more tablets (or capsules) than is recommended for pain relief.

Crushed tablets are inhaled for absorption of the drug through the nasal tissues.

Crushed tablets are insufflated for absorption of the drug through the nasal tissues.

The opioid is physically or chemically removed from the dosage and injected into the vein using a syringe.

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Poly-pharmacy .

Opioids are sometimes used in conjunction with alcohol, methamphetamine, or other drugs to accentuate the euphoria.

Opioids are sometimes used in conjunction with alcohol, methamphetamine, benzodiazepines or other drugs to enhance the euphoria.

Users may accidentally introduce excessive quantities of drugs in their systems or combine drugs that may heighten the chance of

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like Adderall are manufactured in pill form and are intended for oral ingestion.

Fifty-three percent of Adderall prescriptions are prescribed

to the 10.5 million adults that are diagnosed with attention deficit hyperactivity disorder, or ADHD.

ADHD is the most common neurodevelopment

disorder in children.

Five million adults misuse stimulant medication annually, by using alternative consumption methods to achieve a

more intense high faster;

As of Q4 2022, seventy-five percent of Adderall prescriptions

are prescribed to the 10.5 million adults, age 22 or older, that are diagnosed with attention deficit hyperactivity disorder, or ADHD.

ADHD is the most common neurodevelopment disorder in children.

Five million adults misuse stimulant medication annually, by using alternative

consumption methods to achieve a more intense high faster;

snorting or injecting are most-common methods of abuse.

Both of these methods involve crushing pills.

Both of these methods

involve crushing pills.

believe that having prescription drug products available that have a reduced potential for abuse by crushing and injecting, snorting,

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processes needed for virus product, such as RNA replication or viral protein processing.

An inhaled form of nafamostat could be applied

to patients that have a more severe stage of the disease.

An inhaled form of nafamostat could be prescribed

for patients that have a more severe stage of the disease.

lead clinical program is an oral drug product of nafamostat for use against COVID-19 and other coronaviral infections.

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treatment that is taken in oral form within two days of influenza symptoms starting and applying a two-dosage daily schedule.

the H5N1 outbreaks and the H1N1 and other coronavirus outbreaks, Tamiflu® had annual U.S.

sales above $1 billion and has had cumulative

sales of $15.9 billion since its launch in 1999.

other coronavirus outbreaks, sales of Tamiflu® were $950 million in the US and $2.426 billion cumulative sales worldwide (2016-2020).

Sales of Paxlovid from Pfizer for COVID-19 totaled approximately $19 billion in 2022, an indication of the continuing unmet need for

treatments around the world.

World Health Organization estimates influenza epidemics result in approximately three to five million cases of severe illness and 290,000

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influenza vaccines are approximately 45% effective since the 2010 influenza season.

influenza and coronavirus vaccines remain several years from market launch, making nafamostat a potential first line of defense against

are only four antiviral treatments for early symptoms of influenza for hospitalized patients that have severe, complicated, or progressive

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when the drug is ingested and exposed to the digestive enzyme trypsin).

We believe that our TAAP prodrugs delivery system demonstrates

several features aimed at resisting both oral and non-oral modes of abuse.

Our TAAP prodrugs delivery system demonstrates a number

of features aimed at resisting both oral and non-oral modes of abuse.

This platform’s approach differs from current formulation-based

strategies (abuse deterrent formulations, or ADFs) in a number of ways including that it is designed to be unaffected by simple physical

manipulations (e.g.

crushing and extraction and/or chewing of the dose form provided to patients).

We believe the potential benefits

to society of applying TAAP to opioids and amphetamines providing medication that resists both oral and parenteral abuse are considerable.

strategies (abuse deterrent formulations, or ADFs) in a number of ways.

First, the abuse-resistance provided by TAAP is designed to be

unaffected by simple physical manipulations (e.g., crushing and extraction and/or chewing of the dose form provided to patients).

believe the potential benefits to society of applying TAAP to opioids and amphetamines providing medication that resists both oral and

parenteral abuse are considerable.

Prescription Drugs

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which is an ingredient in our overdose protection combination products, is also being developed for infection and pulmonary lung diseases.

Besides our clinical candidates, we have a product portfolio of other TAAP and MPAR TM opioids that could potentially be

developed to build on this pipeline.

is a chemically modified, delayed onset oxycodone-derivative which releases clinically effective oxycodone only when exposed trypsin

Besides our clinical candidates, we have a product portfolio of other TAAP and MPAR TM opioids that could potentially be developed

to build on this pipeline.

our clinical candidates, we have a product portfolio of other TAAP and MPAR TM opioids and amphetamines that could potentially

be developed to build on this pipeline.

is a chemically modified, extended-release oxycodone-derivative which releases clinically effective oxycodone only when exposed trypsin

in the gut (i.e., when the drug is ingested).

This approach differs from formulation-based strategies which are currently commercially

available, in several ways.

Foremost, the abuse-resistance provided by PF614 is designed to be unaffected by simple physical manipulations

available, in a number of ways.

First, the abuse-resistance provided by PF614 is designed to be unaffected by simple physical manipulations

(e.g., extraction, chewing, and/or crushing).

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at doses up to 200 mg in healthy subjects.

initiated additional clinical studies with PF614 in the fourth quarter of 2021.

A multi ascending dose study with a bioequivalence arm,

PF614-102 concluded enrollment, with data anticipated in the second quarter of 2022.

In 2022, two human abuse liability studies will

be initiated to understand the tendency for drug abusers to like the effects achieved from taking PF614 either orally or nasally as compared

to that of a comparator product such as crushed OxyContin.

IND application (IND 150966) received FDA allowance and a Phase 1 study was initiated in December 2021 with first patients dosed.

study to evaluate PF614-MPAR™ is entitled “A Single Dose, 2 Part Study to Evaluate the Pharmacokinetics of Oxycodone, PF614,

PFR06082, and nafamostat, when PF614 Solution is Co-Administered with nafamostat, as an Immediate Release Solution and/or Extended Release

(ER) Capsule Formulations in Healthy Subjects”.

Phase 1b Clinical Trial

Phase 1b study was conducted by ICON (formerly PRA Health Sciences) with Dr.

M Johnston as Principal investigator.

This was a 2-part

study comprised of a MAD study (Part A) and a comparative bioavailability/bioequivalence and food effect study (Part B) in healthy subjects.

Part A treated a total of 24 subjects and utilized a randomized, open-label, MAD design with up to 3 separate dose groups of 8 subjects

Within each dose group, subjects were randomized to receive either PF614 (n=6) or OxyContin (n=2).

Subjects received repeated

BID doses, planned to be administered every 12 hours (q12h) over a 5-day period, for a total of 9 doses.

PF614 doses were 50 mg, 100

mg, and 200 mg, which were expected to be approximately equivalent to the 20 mg, 40 mg, and 80 mg OxyContin doses, for Dose Groups 1,

2, and 3, respectively.

Serial PK sampling was performed for the first day/first dose (Day 1) and for the last day/last dose (Day 5).

Only trough PK samples were taken within 30 minutes prior to the morning dose on Days 2, 3, and 4.

Safety assessments, including regular

assessments of adverse events (AEs), vital signs (pulse rate, blood pressure, respiratory rate, and oxygen saturation [SpO 2 ]),

clinical laboratory tests, 12-lead electrocardiograms (ECGs), and cardiac telemetry were monitored throughout the study.

Subjects were

monitored for hypotension, hypopnea, apnea, and oxygen desaturation.

B treated a total of 60 subjects and utilized an open-label, single-dose, randomized, 4-way crossover design.

Subjects were randomized

to receive each of the following single oral doses of study drugs in a Williams design crossover manner (1 at each treatment period):

100 mg PF614, administered under fasted conditions (hereafter referred to as 100 mg PF614, fasted)

100 mg PF614, administered under fed conditions (high-fat breakfast) (hereafter referred to as 100 mg PF614, fed)

40 mg OxyContin, administered under fasted conditions (hereafter referred to as 40 mg OxyContin, fasted)

40 mg OxyContin, administered under fed conditions (high-fat breakfast) (hereafter referred to as 40 mg OxyContin, fed)

treatment was separated by a washout interval of 5 days.

Serial PK sampling was performed after each study drug administration up to

120 hours postdose.

Safety including regular assessments of AEs, vital signs (pulse rate, blood pressure, respiratory rate, and SpO 2

), clinical laboratory tests, and 12-lead ECGs were monitored.

Subjects were monitored for hypotension, hypopnea, apnea, and oxygen

desaturation.

Pharmacokinetics

The shape of the plasma concentration versus time curve of oxycodone was similar following administration of PF614 and OxyContin (oxycodone

extended release).

Oxycodone plasma exposure (T max , C max,ss and AUC tau ) were assessed and PF614 showed

similar trends as OxyContin following administration of multiple oral BID doses.

Due to the small sample number for OxyContin some PK

parameters could not be calculated.

Trough concentrations of oxycodone were generally similar from Day 2 through Day 4, suggesting that

subjects achieved steady state after repeated oral BID dosing of PF614 and OxyContin at all dose levels.

A total of 57 subject were included in the PK analyses.

The data for C max , AUC 0-t , and AUC 0-inf of

oxycodone post 100 mg PF614 versus 40 mg OxyContin dosing under fasted and fed conditions were completely contained within the standard

bioequivalence limits of 80% to 125%.

Therefore, it was concluded that 100 mg PF614 was bioequivalent to 40 mg OxyContin under both fasted

and fed conditions.

was generally safe and well-tolerated following oral administration of 50 mg, 100 mg, or 200 mg PF614 BID for 5 days.

There was no apparent

difference in the safety profile of single oral doses of 100 mg PF614 when administered in the fasted or fed state or between PF614 and

OxyContin when administered in the fasted and fed state.

PF614 was generally safe and well-tolerated following single and multiple oral

doses under naltrexone blockade.

Intranasal Human Abuse Potential Clinical Trial

was a randomized, double-blind, placebo- and active-controlled, 3-way crossover study to evaluate the abuse potential and pharmacokinetics

of intranasally administered PF614, relative to crushed oxycodone IR tablets and placebo, in non-dependent recreational opioid users

conducted by Lotus Clinical Trials LLC through Ohio Clinical Trials, Inc with Principal investigator, Dr.

study consisted of 4 phases:

Screening, Qualification, Treatment, and Follow-up.

Subjects were randomized to receive PF614 100mg or crushed

oxycodone 40 mg intranasally.

The primary objective of the study was to evaluate the abuse potential of PF614 relative to crushed oxycodone

immediate-release (IR) tablets and placebo following intranasal administration in non-dependent recreational opioid users (n=26), with

the primary pharmacodynamic endpoint being the maximum effect (E max ) for Drug Liking (“ at this moment ”)

measured up to 24 hours after dosing using a visual analogue scale (VAS).

The secondary objectives of the study were to evaluate the

pharmacokinetic profile of PF614 relative to crushed oxycodone IR tablets following intranasal administration, to evaluate the safety

of PF614 following intranasal administration.

the study, PF614 powder produced a statistically significant lower peak “drug liking” (Emax) when compared with intranasal

crushed IR oxycodone (p = 0.0133) using the full modified completer population in a 3-period crossover of PF614 vs.

crushed oxycodone

Furthermore, in a first period analysis of initial impressions of each drug, a statistically significant difference was

noted between PF614 (n=8) and crushed IR oxycodone (n=10) (p = 0.0175), even with this smaller cohort of subjects.

Statistically

significant differences in peak effects (Emax) between PF614 and crushed IR oxycodone intranasal were also demonstrated for the secondary

endpoint of “take drug again,” also using a first period analysis (p < 0.0001).

intranasal HAP study was designed to test if known recreational drug users “ liked ” the product and is critical for

labeling claims for new drugs in this class.

The primary measure in this study, “ drug liking ,” is recommended by the

FDA in their Guidance on “Assessment of Abuse Potential of Drugs.” This measure is known to correlate with a drug’s

potential for abuse.

The results demonstrated that inhaled powdered PF614 had significantly lower drug liking than inhaled crushed IR

2022 we initiated two human abuse potential studies of PF614 to understand the tendency for drug abusers to like the effects achieved

from taking PF614 either orally or intranasally as compared to that of a comparator product such as crushed oxycodone.

The data from

these studies will be used to support our application for ‘Abuse Deterrent’ labeling for PF614.

The data from the intranasal

study was reported on October 31, 2022 and the data from the oral study is expected to be available in early 2023.

We intend to explore

pain indications to evaluate PF614 for efficacy and safety which we are seeking to initiate in 2023.

We are also planning to evaluate

nafamostat in COVID-19 subjects when delivered as an oral drug product.

The ability to undertake these studies will depend on additional

We have funded our operations to date primarily with proceeds from the sale of equity and borrowings under convertible promissory

notes and federal grants.

See “ —Convertible Promissory Notes ” and “ —Federal Grants ”

for additional information.

November 2022, we received written guidance from the FDA that an acute pain indication may be appropriate for PF614.

The FDA guidance,

while not binding, states that our proposed clinical development approach of conducting at least two adequate and well-controlled clinical

trials in two different pain models comparing PF614 to a placebo and to another immediate release (IR) opioid, such as IR oxycodone,

appears reasonable to support a new drug application for PF614 for an acute pain indication.

The FDA guidance also provides additional

guidance with respect to the non-clinical studies and clinical trials planned by us.

The clinical development pathway of PF614 for an

acute pain indication may reduce the development timeline and be more cost-effective than initially pursuing a chronic pain indication

initiated a Phase 1 study that is evaluating PF614-MPAR™ in study entitled “A Single Dose, 2 Part Study to Evaluate the Pharmacokinetics

of Oxycodone, PF614, PFR06082, and nafamostat, when PF614 Solution is Co-Administered with nafamostat, as an Immediate Release Solution

and/or Extended Release (ER) Capsule Formulations in Healthy Subjects:” We are clinically testing MPAR in partnership with Quotient

Sciences, using its integrated Translational Pharmaceutics® platform to search for a PF614-MPAR formulation that allows conversion

into oxycodone within the prescribed dose range but reduces conversion to oxycodone at higher than prescribed dose levels in an overdose

PF614-MPAR™-101

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design space describing formulation variables for release rate and dose.

Initial data was reported in May 2022 that demonstrated nafamostat

administer in combination with PF614 in a simulated overdose situation reduced the release of oxycodone from PF614 as designed.

the clinical portion of Part A of this study in December 2022 and expect to report final data from this portion of the study by the end

of December 2022.

The study will continue in 2023 to test the overdose protection of the selected formulation by administering an escalating

number of dose units to a group of healthy subjects.

Data is expected in the second half of 2023.

Phase 1 Clinical Trial

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present with fever and a respiratory illness, some patients also report gastrointestinal symptoms, such as diarrhea, vomiting, and abdominal

Studies have identified a recent strain of COVID-19 virus, SARS-CoV-2 RNA, in stool specimens of infected patients, and its viral

receptor angiotensin converting enzyme 2 was found to be highly expressed in gastrointestinal epithelial cells.

These suggest that SARS-CoV-2

can actively infect and replicate in the gastrointestinal tract, and oral nafamostat which acts locally in the gut may be able to reduce

the ability of the virus to replicate.

Studies have identified the most recent strain of COVID-19 virus, SARS-CoV-2 RNA, in stool specimens of infected patients, and

its viral receptor angiotensin converting enzyme 2 was found to be highly expressed in gastrointestinal epithelial cells.

These suggest

that SARS-CoV-2 can actively infect and replicate in the gastrointestinal tract, and oral nafamostat which acts locally in the gut will

reduce the ability of the virus to replicate.

The purpose of our study was to evaluate the safety of oral nafamostat in healthy volunteers.

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gastrointestinal tract.

are also planning to evaluate nafamostat in a Phase 2 clinical trial in COVID-19 subjects when delivered as an oral drug product.

industry is characterized by rapidly advancing technologies, intense competition, and a strong emphasis on proprietary products.

to face competition from a number of sources, including pharmaceutical and biotechnology companies, generic drug companies, drug delivery

companies, and academic and research institutions.

Many of these existing and potential competitors have significantly greater financial

resources, more people and other resources than we do.

key competitive factors that are expected to affect the development and commercial success of our product candidates include their respective

degree to limit human abuse potential, bioavailability, enhance therapeutic efficacy, and convenience of dosing and distribution.

addition, other factors include their respective safety, cost and tolerability profiles are likely to be important factors.

product candidate, PF614, may also face competition from commercially available generic and branded immediate and extended-release opioid

drugs other than oxycodone, including, but not limited to, fentanyl, hydromorphone, and oxymorphone, as well as opioids that may be currently

in clinical development.

an abuse-deterrent label through the FDA involves a lengthy and complicated process.

We believe abuse-deterrent opioids represent a therapeutic

option to maximize pain relief in patients for whom opioid analgesia is indicated, while reducing the risks of abuse and diversion.

approval, the FDA evaluates the results from in vitro manipulation and extraction, pharmacokinetics, and clinical human abuse potential

studies to determine whether the accumulated evidence is sufficient to warrant claims of abuse deterrence.

Post-marketing studies may

also be required to determine whether the marketing of a product with abuse-deterrent properties results in meaningful reductions in

abuse, misuse, and related adverse clinical outcomes, including addiction, overdose, and death in the post-approval setting.

are only four commercially available (in the United States) opioid drugs for chronic pain relief that have an abuse-deterrent label.

are planning to evaluate nafamostat in a Phase 2 clinical trial in COVID-19 subjects when delivered as an oral drug product.

200 mg capsules have been manufactured and are on stability evaluation.

life sciences industry is characterized by rapidly advancing technologies, intense competition, and a strong emphasis on proprietary

We expect to face competition from a number of sources, including pharmaceutical and biotechnology companies, generic drug

companies, drug delivery companies, and academic and research institutions.

Most of these existing and potential competitors have significantly

greater financial and other resources than we do.

key competitive factors that are expected to affect the development and commercial success of our product candidates include safety and

tolerability, the ability of our product candidates to limit human abuse potential, bioavailability and therapeutic efficacy of our product

candidates, market indications and convenience of dosing and distribution.

PF614 will also face competition from commercially available

generic and branded extended-release and long-acting opioid drugs other than oxycodone, including, but not limited to, fentanyl, hydromorphone,

oxymorphone, and methadone, as well as opioids that are currently in clinical development.

believe that obtaining an abuse-deterrent label through the FDA for our prodrugs would provide us with a significant competitive advantage.

There are only four commercially available (in the United States) opioid drugs for chronic pain relief that have an abuse-deterrent label.

These drugs are MorphaBond™ ER, marketed by Daiichi Sankyo, OxyContin® ER and Hysingla® ER, both of which are marketed

by Purdue Pharma, LP, and Collegium Pharmaceutical, Inc.’s XTampza®ER.

Hysingla® ER is a once-a-day hydrocodone extended-release

Xtampza® ER is a twice daily, extended-release opioid formulation that contains microspheres that combine oxycodone with

inactive ingredients to increase the difficulty of tampering.

Xtampza®ER has abuse-deterrent properties in the FDA approved product

label, and post-marketing data has shown Xtampza®ER abuse, misuse, and diversion and tampering are low relative to other prescription

opioid analgesics.

Pharma LP is expected to have tighter marketing and management controls than it has exhibited in the past which may impact its overall

market share.

While Oxycontin OP is an abuse-deterrent formula that has impacted the ability to snort or inject, the drug has been documented

to be abused through other means.

other companies including, but not limited to, Pfizer Inc., Daiichi Sankyo, Teva Pharmaceutical, Inc., Egalet Ltd., KemPharm Inc., Elysium

Therapeutics Inc., and Acura Pharmaceutical, have either extended-release or abuse-deterrent products in various stages of development.

Other companies offer products indicated for chronic, severe, long-term pain with various delivery technologies, but these products do

not have abuse-deterrent claims on their labels.

do not believe there are other companies developing products that have an overdose mechanism to compete with our MPAR™ technology.

However, obtaining an abuse-deterrent label involves

a lengthy and complicated process with no certainty of success.

We believe abuse-deterrent opioids represent a therapeutic option to

maximize pain relief in patients for whom opioid analgesia is indicated, while reducing the risks of abuse and diversion.

number of other companies including, but not limited to, Pfizer Inc., Daiichi Sankyo, Endo Health Solutions, Nektar Therapeutics, Teva

Pharmaceutical, Inc., Egalet Ltd., KemPharm Inc., Elysium Therapeutics Inc., and Acura Pharmaceutical, have either extended-release or

abuse-deterrent products in various stages of development.

Other companies offer products indicated for chronic, severe, long-term pain

with various delivery technologies, but these products do not have abuse-deterrent claims on their labels.

do not believe there are other companies developing products that have an overdose mechanism similar to our MPAR™ technology.

commercial success depends in part on our ability to obtain and maintain proprietary protection for product candidates and any of our

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trade secrets, know-how, continuing technological innovation, and potential in-licensing opportunities to develop and maintain our proprietary

August 2020, EBIR entered into a Technology Transfer Agreement with Mucokinetica to acquire its intellectual property and all assets

associated with the inhaled nafamostat program.

Specifically, EBIR acquired Patent EP2124926B1 and all data and assets associated with

the development and expansion of the inhaled nafamostat program.

These assets included COVID-19 and cystic fibrosis drug targets in development.

consideration for this intellectual property, Mucokinetica received a 1% equity ownership in EBIR, and its founders, Roderick Hall and

Peter Cole, entered into Consulting Agreements with EBIR.

The Consulting Agreements were subsequently terminated by Messrs.

and Patent Applications

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These patents

and patents that may issue from pending patent applications, are projected to expire between 2028 and 2041, subject to any patent term

adjustment or extension that might be available in a particular jurisdiction.

A table of the key patent families and their projected

expiry dates is presented below.

Projected Expiry Date

and applications are projected to expire between 2028 and 2042, subject to any patent term adjustment or extension that might be available

in a particular jurisdiction.

A table of the key patent families and their natural or projected expiry dates is presented below.

and MPAR™ Patents and Applications for Opioids

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Australia, Brazil, Canada, China, Europe, Hong Kong, Israel, India, Japan, Russia

Enzyme-Cleavable

Methadone Prodrugs and Methods of Use Thereof

Comprising Enzyme-Cleavable Prodrugs and Controlled Release Nafamostat and Methods of Use Thereof

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Australia, Brazil, Canada, China, Europe, Hong Kong, Israel, India, Japan, Russia

Enzyme-Cleavable

Methadone Prodrugs and Methods of Use Thereof

Patents and Applications

of Treating Coronavirus Infections and COVID-19

Cooperation Treaty member countries

Canada, Europe

formulations of Nafamostat

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Comprising Enzyme-Cleavable Amphetamine Prodrugs and Inhibitors Thereof

refers to patent applications filed in, and patents issued by, the European Patent Office (“ EPO ”), which can

provide the basis for rights in multiple countries that are members of the European Patent Convention.

Europe, Hong Kong

refers to patent applications filed in, and patents issued by, the European Patent Office (“ EPO ”), which can provide

the basis for rights in multiple countries that are members of the European Patent Convention.

we seek broad coverage under our existing patent applications, there is always a risk that an alteration to the products or processes

may provide sufficient basis for a competitor to avoid infringing our patent claims.

In addition, patents, if granted, expire, and extension

of term may not be available.

We also cannot provide any assurance that any patents will be issued from our pending or any future applications

or that any potentially issued patents will adequately protect our product candidates.

enforceable term of an individual patent varies depending on the date of filing of the patent application, the date of patent issuance,

and the statutory term of patents in the countries in which they are obtained.

Generally, in the United States, patents are granted a

term of 20 years from the earliest effective non-provisional filing date.

In addition, in certain instances, a patent term can be extended

to recapture a period due to delay by the United States Patent and Trademark Office (“ USPTO ”) in issuing the patent

as well as a portion of the term effectively lost as a result of the FDA regulatory review period.

However, as to the FDA component,

the restoration period cannot be longer than five years, the total patent term including the restoration period must not exceed fourteen

years following FDA approval, and the scope of patent coverage is limited to the scope of the FDA approved product.

The duration of foreign

patents varies in accordance with provisions of applicable local law, but typically is also 20 years from the earliest effective non-provisional

However, the actual protection afforded by a patent varies on a product-by-product basis, from country to country, and depends

upon many factors, including the type of patent, the scope of its coverage, the availability of regulatory-related extensions, the availability

of legal remedies in a particular country, and the validity and enforceability of the patent.

In addition, patents, if granted, expire and we

cannot provide any assurance that any patents will be issued from our pending or any future applications or that any potentially issued

patents will adequately protect our product candidates.

patents extend for varying periods depending on the date of filing of the patent application or the date of patent issuance and the legal

term of patents in the countries in which they are obtained.

Generally, patents issued for regularly filed applications in the United

States are granted a term of 20 years from the earliest effective non-provisional filing date.

In addition, in certain instances, a patent

term can be extended to recapture a period due to delay by the United States Patent and Trademark Office (“ USPTO ”)

in issuing the patent as well as a portion of the term effectively lost as a result of the FDA regulatory review period.

to the FDA component, the restoration period cannot be longer than five years and the total patent term including the restoration period

must not exceed fourteen years following FDA approval.

The duration of foreign patents varies in accordance with provisions of applicable

local law, but typically is also 20 years from the earliest effective non-provisional filing date.

However, the actual protection afforded

by a patent varies on a product-by-product basis, from country to country, and depends upon many factors, including the type of patent,

the scope of its coverage, the availability of regulatory-related extensions, the availability of legal remedies in a particular country,

and the validity and enforceability of the patent.

commercial success will also depend in part on not infringing upon the proprietary rights of third parties.

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patents, as well as granted patents

and pending patent applications in numerous foreign jurisdictions, including Australia, Brazil, Canada, China, the EPO, India, Japan,

and pending patent applications in numerous foreign jurisdictions, including Australia, Brazil, Canada, China, Europe, India, Japan,

and Russia, relating to chemically modified opioids, such as oxycodone, methadone, and hydromorphone, covalently linked using specific

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compositions containing these modified opioids and a gastrointestinal enzyme inhibitor, and methods of using the same to treat pain.

Three of these patent families are variously directed to ketone containing opioids and cover PF614 and PF614-MPAR™ and certain

methadone TAAP product candidates that are still in the discovery phase.

These three families contain issued patents in the United States

and certain foreign jurisdictions, including Australia, Brazil, Canada, China, the EPO, India, Japan, and Russia and expire between 2030

and 2032, subject to any applicable patent term extension that might be available in a jurisdiction.

We also own a patent family with

pending applications filed in the U.S., Taiwan and under the Patent Cooperation Treaty, which applications include coverage for oral

formulations of PF614-MPAR™, which if pursued and issued would expire in 2042, subject to any potential patent term adjustment

or extension that may be available in a jurisdiction.

We also own one patent family that includes granted patents in the United States,

as well as granted patents and pending patent applications in numerous foreign jurisdictions, including Australia, Brazil, Canada, China,

the EPO, India, Japan, and Russia, relating to chemically modified ketone-containing agents, such as oxycodone, methadone, and hydromorphone,

covalently linked using specific linkers to a gastrointestinal enzyme-cleavable moiety, pharmaceutical compositions containing these

modified ketone-containing agents, pharmaceutical compositions containing these modified ketone-containing agents and a gastrointestinal

enzyme inhibitor, and methods of using the same to treat pain, would cover certain methadone TAAP product candidates that are still in

discovery phase and have an earliest expiration date in 2030.

While we own these patent families, we have not updated records in the

various patent offices to reflect our ownership of these patent families.

Failure to update such ownership may result in an innocent

purchaser potentially acquiring rights in such patents that are adverse to our interests.

Furthermore, as noted above, we have not obtained

assignments for certain patent applications relating to abuse-resistant amphetamines.

Three of these patent families are directed to ketone containing opioids and cover PF614 and PF614-MPAR™ and certain methadone

TAAP product candidates that are still in the discovery phase.

These three families contain issued patents in the United States and certain

foreign jurisdictions, including Australia, Brazil, Canada, China, Europe, India, Japan, and Russia and expire between 2030 and 2032,

subject to any applicable patent term extension that might be available in a jurisdiction.

We also own pending United States, Patent

Cooperation Treaty (PCT), and Taiwan applications directed to oral formulations of PF614-MPAR™, which if pursued and issued would

expire in 2042, subject to any potential patent term adjustment or extension that may be available in a jurisdiction.

We also own one

patent family that includes granted patents in the United States, as well as granted patents and pending patent applications in numerous

foreign jurisdictions, including Australia, Brazil, Canada, China, Europe, India, Japan, and Russia, relating to chemically modified

ketone-containing agents, such as oxycodone, methadone, and hydromorphone, covalently linked using specific linkers to a gastrointestinal

enzyme-cleavable moiety, pharmaceutical compositions containing these modified ketone-containing agents, pharmaceutical compositions

containing these modified ketone-containing agents and a gastrointestinal enzyme inhibitor, and methods of using the same to treat pain,

would cover certain methadone TAAP product candidates that are still in discovery phase and expire in 2032.

While we own these patent

families, we have not updated records in the various patent offices to reflect our ownership of these patent families.

Failure to update

such ownership may result in an innocent purchaser potentially acquiring rights in such patents that are adverse to our interests.

as noted above, we have not obtained assignments for certain patent applications relating to abuse-resistant amphetamines.

believe that one patent covering PF614 will be eligible for up to five years of patent term extension in the United States and intend

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Patents Applications

own one pending Patent Cooperation Treaty, or PCT, application directed to the use of orally administered nafamostat for the treatment

of infections caused by coronaviruses, including COVID-19, and a pending PCT, U.S.

and Taiwan application directed to oral formulations

own pending applications in the U.S., Canada and Europe directed to the use of orally administered nafamostat for the treatment of infections

caused by coronaviruses, including COVID-19, and pending United States, PCT, and Taiwan patent applications directed to oral formulations

of nafamostat.

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jurisdiction.

Additionally, we acquired one European patent from Mucokinetica that is directed to the use of certain compounds, including

nafamostat, for the manufacture of a medicament for the treatment of respiratory diseases with mucostasis or poor mucus clearance.

patent was validated in Germany, France, Italy, and the United Kingdom and expires in 2028, subject to any applicable patent term extension

that might be available in Europe Union or United Kingdom.

While we own this patent family, we have not updated the records in the various

patent offices to reflect our ownership of this patent family.

Failure to update such ownership may result in an innocent purchaser potentially

acquiring rights in such patents that are adverse to our interests.

Additionally, we acquired one European patent from Mucokinetica Ltd.

that is directed to the use of certain compounds,

including nafamostat, for the manufacture of a medicament for the treatment of respiratory diseases with mucostasis or poor mucus clearance.

This patent was validated in Germany, France, Italy, and the United Kingdom and expires in 2028, subject to any applicable patent term

extension that might be available in Europe Union or United Kingdom.

Currently, we do not have any issued patent or pending application

directed to methods of treating infections caused by coronaviruses, including COVID-19, with inhaled nafamostat.

In addition to patent

exclusivity, under the provisions of the Hatch-Waxman Act, upon any approval in the United States, we believe that nafamostat will be

eligible for five-year NCE regulatory exclusivity, during which time no 505(b)(2) NDA or ANDA can be approved that contains the same

active moiety as the chemical entity in the nafamostat NDA.

directed to methods of treating infections caused by coronaviruses, including COVID-19, with inhaled nafamostat, but intend to file pending

applications upon development of a suitable inhalation formulation of nafamostat.

We believe that one patent covering nafamostat will

be eligible for up to five years of patent term extension in the United States and Europe and intend to pursue such extension.

to patent exclusivity, under the provisions of the Hatch-Waxman Act, upon any approval in the United States, we believe that nafamostat

will be eligible for five-year NCE regulatory exclusivity, during which time no 505(b)(2) NDA or ANDA can be approved that contains the

same active moiety as the chemical entity in the nafamostat NDA.

In addition, if an ANDA or 505(b)(2) applicant were to file its application

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and MPAR™ Patents and Applications for Amphetamines

the merger with Signature, we became the owner of one patent family that includes issued patents in the United States and numerous European

foreign jurisdictions (through the EPO), and a pending application in the United States, relating to chemically modified amphetamines

covalently linked to a gastrointestinal enzyme-cleavable moiety, pharmaceutical compositions containing the modified amphetamines, pharmaceutical

compositions containing the modified amphetamines and a gastrointestinal enzyme inhibitor and methods of using the same to treat a subject.

While we own this patent family, we have not updated the records in the various patent offices to reflect our ownership of this patent

Failure to update such ownership may result in an innocent purchaser potentially acquiring rights in such patents that are adverse

to our interests.

In addition, we own one patent family with pending applications in the United States and the EPO directed to pharmaceutical

compositions containing chemically modified amphetamines covalently linked to a gastrointestinal enzyme-cleavable moiety and a trypsin

inhibitor and methods of using the same to treat a subject.

We have not obtained assignments from all of the inventors of this patent

family to date, which could negatively impact our ability to pursue or enforce this application.

If issued, these patent applications

would expire between 2031 and 2040, subject to any applicable patent term adjustment or extension that might be available in a jurisdiction.

the merger with Signature, we became the owner of one patent family that includes pending applications in the United States and numerous

European foreign jurisdictions relating to chemically modified amphetamines covalently linked to a gastrointestinal enzyme-cleavable

moiety, pharmaceutical compositions containing the modified amphetamines, pharmaceutical compositions containing the modified amphetamines

and a gastrointestinal enzyme inhibitor and methods of using the same to treat a subject.

While we own this patent family, we have not

updated the records in the various patent offices to reflect our ownership of this patent family.

Failure to update such ownership may

result in an innocent purchaser potentially acquiring rights in such patents that are adverse to our interests.

In addition, we own pending

United States and European patent applications directed to pharmaceutical compositions containing chemically modified amphetamines covalently

linked to a gastrointestinal enzyme-cleavable moiety and a trypsin inhibitor and methods of using the same to treat a subjects.

not obtained assignments from all of the inventors of these applications to date, which could negatively impact our ability to pursue

or enforce this application.

If issued, these patent applications would expire between 2031 and 2040, subject to any applicable patent

term adjustment or extension that might be available in a jurisdiction.

and Trade Secrets

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Manufacturing

drug substance and drug products are manufactured by contract manufacturing organizations.

We do not currently own or operate manufacturing

facilities for the production of clinical or commercial quantities of our product candidates.

Any manufacturing problem or the loss of

a contract manufacturer could be disruptive to our operations and result in lost sales.

See “ Risk Factors ” for more

Although we intend to rely on third-party contract manufacturers to produce our product candidates, we have personnel with

experience managing the third-party contract manufacturers who are expected to produce our product candidates and other product candidates

or products that we may develop in the future.

do not currently own or operate manufacturing facilities for the production of clinical or commercial quantities of our product candidates.

Our drug substance and drug products are manufactured for us by contract manufacturing organizations, or CMOs, to our specifications.

Any manufacturing problem or the loss of a CMO could be disruptive to our operations and result in lost sales.

lead product candidate, PF614, is small molecule opioid prodrug.

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Administration (“ DEA ”) and state-controlled substance authorities.

Our third-party manufacturers will be required

to be registered with DEA and will be responsible for obtaining adequate quota to manufacture and otherwise handle controlled substances.

Our CMOs will be required to be registered with

DEA and will be responsible for obtaining adequate quota to manufacture and otherwise handle controlled substances.

currently engage third parties to provide clinical supplies of PF614 and nafamostat.

We also currently engage a third-party manufacturer

to provide drug product manufacture of PF614, PF614-MPAR™, and nafamostat.

We currently have sufficient supplies of PF614 and nafamostat

on hand for our current clinical trial needs.

Any reliance on suppliers may involve several risks, including a potential inability to

obtain critical materials and reduced control over production costs, delivery schedules, reliability, and quality.

Factors ” for more information.

Manufacturing Agreement

to the Recro Agreement, we engaged Recro to manufacture PF614 and other clinical trial materials under cGMP conditions and provide stability

studies with respect to our PF614 clinical trials.

Pursuant to the agreement, Recro will create placebo capsules, PF614 powder-filled

capsules and provide us with master batch records and a GMP manufacturing report upon completion of manufacturing and analytical activities.

Under the Recro Agreement, Recro also generated stability data according to ICH program for two formulations to provide stability data

for shelf-life assessment with respect to our Phase II clinical trial.

We have agreed to pay Recro $173,000 and pass-through costs, estimated

at $14,000 at the time of the agreement, for the manufacturing and services provided under the Recro Agreement.

The term of the Recro

Agreement began on September 19, 2019 and continues until the completion of the manufacturing and services described in therein.

we paused the Recro Agreement in early 2020 in connection with the timing of our PF614 clinical studies and resumed in the first quarter

We expect to enter into additional related agreements with Recro.

In the event that Recro is unable to perform the services

promised under the Recro Agreement, we may be subject to unforeseen costs and delays with respect to our clinical trials and be unable

to replace the Recro Agreement on terms as favorable to us.

See “ Risk Factors—We expect to be completely dependent on

third parties to manufacture our product candidates, and our commercialization of our product candidates could be halted, delayed or

made less profitable if those third parties fail to maintain a compliance status acceptable to the FDA or comparable foreign regulatory

authorities, fail to provide to us with sufficient quantities of our product candidates or fail to do so at acceptable quality levels

or prices ” for more information.

We received funding under federal

grant award programs funded by governmental agencies, such as the NIH and NIDA.

Specifically, for fiscal year 2021, we received funding

revenue of approximately $3.5 million in federal grants, approximately $2.6 million from the NIH related to

the Phase 1 clinical trial for PF614 MPAR™ and approximately $0.9 million from NIDA under our five-year award to undertake

the preclinical development of our opioid use disorder- MPAR TM technology.

We may apply for additional grant funding from

these or similar governmental agencies in the future.

See “ Risks Related to Our Business, Financial Condition and Capital Requirements ”

for additional information.

Promissory Notes

On September 24, 2021, we entered

into a Securities Purchase Agreement (the “SPA”) for an aggregate financing of $15.0 million with institutional investors.

A first closing under the SPA occurred on September 24, 2021, and a second closing under the SPA occurred on November 5, 2021.

first closing, we issued to the investors (i) senior secured convertible promissory notes in the aggregate principal amount of $5.3 million

for an aggregate purchase price of $5.0 million and (ii) warrants to purchase 361,158 shares of the Company’s common stock

in the aggregate at an exercise price of $7.63 per share.

At the second closing, the Company issued to the institutional investors

referenced above, (i) senior secured convertible promissory notes in the aggregate principal amount of $10.6 million for an aggregate

purchase price of $10 million and (ii) warrants to purchase 722,317 shares of the Company’s common stock in the aggregate

at an exercise price of $7.63 per share.

to the GEM Agreement, we are entitled to draw down up to $60.0 million of gross proceeds from GEM Global in exchange for shares of our

common stock, subject to meeting the terms and conditions of the GEM Agreement.

This share subscription facility is available for a period

of 36 months from the closing date of the Merger.

A draw down is subject to limitations on the amount that is drawn under the facility

and must comply with certain conditions precedent including the listing of our shares on a principal market (which includes Nasdaq),

having the necessary number of shares that are issuable pursuant to the draw down registered under an effective registration statement,

and other notice and timing requirements.

Upon our valid exercise of a draw down, pursuant to delivery of a notice and in accordance

with other conditions, GEM Global is required to pay, in cash, a per-share amount equal to 90% of the average closing bid price of the

shares of our common stock recorded by Nasdaq during the 30 consecutive trading days commencing on the first trading day that is designated

on the draw down notice.

In no event may our draw down requests exceed 400% (“ Draw Down Limit ”) of the average daily

trading volume for the 30 trading days immediately preceding the date we deliver the draw down notice.

The SPA limits our ability to

execute certain debt and equity financings, including our existing $60.0 million share subscription facility, while the 2021 Notes remain

See, “ Liquidity and Capital Resources ” for a detailed description of the GEM Facility.

We also currently engage a CMO to provide drug product

manufacture of PF614, PF614-MPAR™, and nafamostat.

We currently have sufficient supplies of PF614 and nafamostat on hand for our

current clinical trial needs.

Any reliance on suppliers may involve several risks, including a potential inability to obtain critical

materials and reduced control over production costs, delivery schedules, reliability, and quality.

LLC manufactures PF614 and other clinical trial materials under cGMP conditions and provides stability studies with respect to our PF614

clinical trials.

We do not currently have a binding written agreement with Purisys.

In the event that Purisys is unable to perform the

services promised under future agreements, we may be subject to unforeseen costs and delays with respect to our clinical trials and may

be unable to replace the Purisys arrangements on terms as favorable to us.

See “ Risk Factors—We expect to be completely

dependent on third parties to manufacture our product candidates, and our commercialization of our product candidates could be halted,

delayed or made less profitable if those third parties fail to maintain a compliance status acceptable to the FDA or comparable foreign

regulatory authorities, fail to provide to us with sufficient quantities of our product candidates or fail to do so at acceptable quality

levels or prices ” for more information.

manufactures PF614 and other clinical trial drug products under cGMP conditions and provides stability studies with respect to our PF614

clinical trials.

Recro (now Societal CDMO) has completed the manufacture of PF614 50 and 100 mg capsules that have been used in clinical

studies PF614-102, PF614-103 and PF614-104.We expect to enter into additional related agreements with Societal CDMO as we manufacture

future batches of PF614.

In the event that Societal is unable to perform the services anticipated under future agreements, we may be

subject to unforeseen costs and delays with respect to our clinical trials.

See “ Risk Factors—We expect to be completely

dependent on third parties to manufacture our product candidates, and our commercialization of our product candidates could be halted,

delayed or made less profitable if those third parties fail to maintain a compliance status acceptable to the FDA or comparable foreign

regulatory authorities, fail to provide to us with sufficient quantities of our product candidates or fail to do so at acceptable quality

levels or prices ” for more information.

have received funding under federal grant award programs through governmental agencies, such as the NIH and NIDA.

For fiscal year 2021,

we received an aggregate of approximately $3.5 million in federal grant funds, approximately $2.6 million from the NIH related to the

Phase 1 clinical trial for PF614 MPAR™ and approximately $0.9 million from NIDA under our five-year award to undertake the preclinical

development of our opioid use disorder-MPAR TM technology.

For the fiscal year ended December 31, 2022, we received federal

grants totaling $2.5 million, $2.0 million from NIH related to the Phase 1 clinical trial for PF614 MPAR™ and $0.5 million from

NIDA for preclinical development of our opioid use disorder-MPAR TM technology.

Current remaining funding under the two approved

grants totals $4.6 million, covering the period through August 31, 2023.

We may apply for additional grant funding from these or similar

governmental agencies in the future.

to the GEM Agreement, we are entitled to draw down up to $60 million of gross proceeds (“ Aggregate Limit ”) from GEM

Global in exchange for shares of our common stock, subject to meeting the terms and conditions of the GEM Agreement.

This equity line

facility is available for a period of 36 months from the closing date of the Merger.

A draw down is subject to limitations on the amount

that is drawn under the facility and must comply with certain conditions precedent including the listing of our shares on a principal

market (which includes Nasdaq), having the necessary number of shares that are issuable pursuant to the draw down registered under an

effective registration statement, and other notice and timing requirements.

Upon our valid exercise of a draw down, pursuant to delivery

of a notice and in accordance with other conditions, GEM Global is required to pay, in cash, a per-share amount equal to 90% of the average

closing bid price of the shares of our common stock recorded by Nasdaq during the 30 consecutive trading days commencing on the first

trading day that is designated on the draw down notice.

In no event may our draw down requests exceed 400% (“ Draw Down Limit ”)

of the average daily trading volume for the 30 trading days immediately preceding the date we deliver the draw down notice.

upon the closing of the Merger, GEM Global became entitled to a commitment fee in the form of cash or freely tradeable shares of our

common stock in an amount equal to 2% of the Aggregate Limit or $1.2 million to be paid in two tranches.

The commitment fee for the first

tranche, which is equal to 67% of the commitment fee, or $800,000, was paid in shares in July 2022 and the commitment fee for the second

tranche, which is equal to the remaining 33% of the commitment fee, or $400,000, was paid in shares in January 2023.

Additionally,

we issued a warrant with a 36-month term at the closing of the Merger granting GYBL the right to purchase 55,306 shares of our common

stock (an amount equal to 4% of the total number of our common stock outstanding as of the closing date of the Merger (subject to adjustments

described below), calculated on a fully diluted basis), at a strike price per share equal to, after several downward adjustments, $0.7512

as of January 12, 2023.

Any failure by us to timely transfer the shares under the warrant pursuant to GYBL’s exercise will entitle

GYBL to compensation in addition to other remedies.

The number of shares underlying the warrant as well as the strike price is subject

to adjustments for recapitalizations, reorganizations, change of control, stock split, stock dividend and reverse stock splits.

price is subject to adjustment for issuances of additional common shares at a price per share less than the strike price.

GEM Agreement contains certain negative covenants restricting us from securing an equity line similar to the financing provided under

the GEM Agreement and requiring prompt notice of events constituting an alternate transaction.

An “ alternate transaction ”

includes an issuance of common stock at a price less than the then current market price, an “ at-the-market ” offering

of securities, and an issuance of options, warrants, or similar rights of subscription or the issuance of convertible equity or debt

See “ Risks Related to Our Business, Financial Condition and Capital Requirements ” for additional information.

pursuant to the terms of the GEM Agreement, we are required to indemnify GEM Global for any losses it incurs as a result of a breach

by us or of our representations and warranties and covenants under the GEM Agreement or for any misstatement or omission of a material

fact in a registration statement registering those shares pursuant to the GEM Agreement.

Also, GEM Global is entitled to be reimbursed

for legal or other costs or expenses reasonably incurred in investigating, preparing, or defending against any such loss.

have not raised any capital pursuant to the GEM facility and we may not raise any capital pursuant to it prior to its expiration.

the United States, pharmaceutical products are subject to extensive regulation by the FDA, and those pharmaceutical products that are

controlled substance are also subject to extensive regulation by the DEA.

The FDC Act, the CSA, and other federal, state, and local statutes

and regulations, govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling,

promotion and marketing, distribution, prescribing, dispensing, post-approval monitoring and reporting, sampling, and import and export

of pharmaceutical products.

Pharmaceutical products used for the prevention, treatment, or cure of a disease or condition of a human

being are subject to regulation under the FDC Act.

The Federal Food, Drug, and Cosmetic Act (the “ FDC

Act ”), the Controlled Substances Act (“ CSA ”), and other federal, state, and local statutes and regulations,

govern, among other things, the research, development, testing, manufacture, storage, recordkeeping, approval, labeling, promotion and

marketing, distribution, prescribing, dispensing, post-approval monitoring and reporting, sampling, and import and export of pharmaceutical

Pharmaceutical products used for the prevention, treatment, or cure of a disease or condition of a human being are subject

to regulation under the FDC Act.

Failure to comply with applicable U.S.

requirements may subject a company to a variety

of administrative or judicial sanctions, such as clinical hold, FDA refusal to approve pending NDAs, revocation of licensing authority,

warning or untitled letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions,

fines, civil penalties, and criminal prosecution.

requirements may subject a company to a variety of administrative

or judicial sanctions, such as clinical hold, FDA refusal to approve pending NDAs, revocation of licensing authority, warning or untitled

letters, product recalls, product seizures, total or partial suspension of production or distribution, injunctions, fines, civil penalties,

and criminal prosecution.

FDA Drug Approval Process

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The submission of most NDAs is additionally subject to a substantial application user

fee, currently exceeding $3.1 million.

Under an approved NDA, the applicant is also subject to an annual program fee, currently approximately

fee, currently exceeding $3.1 million for Fiscal Year 2022.

Under an approved NDA, the applicant is also subject to an annual program

fee, currently exceeding $330,000.

These fees typically increase annually.

Under limited circumstances, an applicant may be exempt from or seek a waiver of the

application fee requirement.

Under limited circumstances, an applicant may be exempt from

or seek a waiver of the application fee requirement.

FDA has 60 days from its receipt of an NDA to determine whether the application will be filed based on the FDA’s determination

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The FDA is not bound by the recommendation of an advisory

committee, but generally follows these recommendations.

Before approving an NDA, the FDA will typically inspect one or more clinical

sites to assure compliance with GCP.

committee, but generally follows such recommendations.

Before approving an NDA, the FDA will typically inspect one or more clinical sites

to assure compliance with GCP.

Additionally, the FDA will inspect the facility or the facilities at which the drug product is manufactured.

The FDA will not approve the product unless compliance with cGMP is satisfactory, and the NDA contains data that provide substantial

evidence that the drug is safe and effective in the claimed indication.

The FDA will not approve the product unless compliance with cGMP is satisfactory and the NDA contains data that provide substantial evidence

that the drug is safe and effective in the claimed indication.

the FDA evaluates the NDA and completes any clinical and manufacturing site inspections, it issues either an approval letter or a complete

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Moreover, the FDA may require substantial post-approval testing and surveillance to monitor the product’s safety or efficacy.

approval, the FDA evaluates the results from in vitro manipulation and extraction, pharmacokinetics, and clinical human abuse potential

studies to determine whether the accumulated evidence is sufficient to warrant claims of abuse deterrence.

Post-marketing studies may

also be required to determine whether the marketing of a product with abuse-deterrent properties results in meaningful reductions in

abuse, misuse, and related adverse clinical outcomes, including addiction, overdose, and death in the post-approval setting.

granted, product approvals may be withdrawn if compliance with regulatory standards is not maintained or problems are identified following

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Fast track designation applies to both the product and the specific indication for which it is being studied.

Any product submitted to FDA for marketing, including under a fast-track program, may be eligible for other types of FDA programs intended

to expedite development and review, such as priority review.

Any product submitted to FDA for marketing, including under a fast track designation, may be eligible for other types of FDA programs

intended to expedite development and review, such as priority review.

review may be granted for products that are intended to treat a serious or life-threatening condition and, if approved, would provide

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FDA will attempt to direct additional resources

to the evaluation of an application designated for priority review in an effort to facilitate the review.

to the evaluation of an application designated for priority review to facilitate the review.

of Clinical Trial Information

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of their drug product.

Drugs approved in this way are commonly referred to as “generic equivalents” to the listed drug and

can often be substituted by pharmacists under prescriptions written for the original listed drug.

Drugs approved in this way are commonly referred to as “ generic equivalents ” to the listed

drug and can often be substituted by pharmacists under prescriptions written for the original listed drug.

ANDA applicant is required to certify to the FDA concerning any patents listed for the approved product in the FDA’s Orange Book.

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Post-Marketing

approval of a new product, a pharmaceutical company and the approved product are subject to continuing regulation by the FDA.

This regulation

includes, among other things, monitoring and recordkeeping activities, reporting to the applicable regulatory authorities of adverse

experiences with the product, providing the regulatory authorities with updated safety and efficacy information, product sampling and

distribution requirements, and complying with promotion and advertising requirements, which include, among others, standards for direct-to-consumer

approval of a new product, a pharmaceutical company and the approved product are subject to continuing regulation by the FDA, including,

among other things, monitoring and recordkeeping activities, reporting to the applicable regulatory authorities of adverse experiences

with the product, providing the regulatory authorities with updated safety and efficacy information, product sampling and distribution

requirements, and complying with promotion and advertising requirements, which include, among others, standards for direct-to-consumer

advertising, restrictions on promoting drugs for uses or in patient populations that are not described in the drug’s approved labeling

(known as “off-label use”), limitations on industry-sponsored scientific and educational activities and requirements for

promotional activities involving the internet.

(known as “ off-label use ”), limitations on industry-sponsored scientific and educational activities and requirements

for promotional activities involving the internet.

Although physicians may prescribe legally available drugs for off-label uses, manufacturers

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In addition, Title II of the Federal Drug Quality and Security Act of 2013, known

as the Drug Supply Chain Security Act or the DSCSA, has imposed new “track and trace” requirements on the distribution of

prescription drug products by manufacturers, distributors, and other entities in the drug supply chain.

as the Drug Supply Chain Security Act or the DSCSA, has imposed new “ track and trace ” requirements on the distribution

of prescription drug products by manufacturers, distributors, and other entities in the drug supply chain.

These requirements are being

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products are regulated as “ controlled substances ” as defined under the CSA and regulations promulgated by DEA.

regulations establish registration, security, recordkeeping, reporting, storage, distribution, importation, exportation, and other requirements

administered by DEA.

law and regulations establish registration, security, recordkeeping, reporting, storage, distribution, importation, exportation, and

other requirements administered by DEA.

substances are classified into five schedules:

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and pharmacies are required to register every three years.

The registration is specific to the particular location, activity, and controlled

substance schedule.

For example, separate registrations are needed for import and manufacturing, and each registration will specify which

schedules of controlled substances the facility is authorized to handle.

The registration is specific to the location, activity, and controlled substance

For example, separate registrations are needed for import and manufacturing, and each registration will specify which schedules

of controlled substances the facility is authorized to handle.

Our contract manufacturers must be registered with DEA.

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legitimate scientific and medicinal needs.

The limited aggregate amount of opioids that the DEA allows to be produced in the United States

each year is allocated among individual companies, which must submit applications annually to the DEA for individual production quotas.

The limited aggregate number of opioids that the DEA allows to be produced in the United States

each year is allocated among individual companies, who must submit applications annually to the DEA for individual production quotas.

Also, dosage form manufacturers must also request a procurement quota to acquire opioid API to manufacture dosage forms for distribution.

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must refuse to complete any sale and report to DEA any orders for which it is unable to resolve any potential “ red flags .”

A compliant suspicious order monitoring system includes well-defined due diligence, “know your customer” process as well

as systems to identify and monitor ordering and sales of controlled substances.

A compliant suspicious order monitoring system includes well-defined due diligence, “ know your customer ” process as

well as systems to identify and monitor ordering and sales of controlled substances.

enforce these requirements, the DEA conducts periodic inspections of registered establishments that handle controlled substances.

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Prescribing Guidelines:

In March 2016, the CDC released a new Guideline for Prescribing Opioids for Chronic Pain intended to assist

primary care providers treating adults for chronic pain in outpatient settings.

The guideline provides recommendations to improve

communications between doctors and patients about the risks and benefits of opioid therapy for chronic pain, improve the safety and

effectiveness of pain treatment, and reduce the risks associated with long-term opioid therapy.

In November 2022, the CDC released a new Guideline for Prescribing Opioids for Pain to update their 2016

The new guidance includes recommendations for managing acute (duration of <1 month), subacute (duration of 1–3

months), and chronic (duration of >3 months) pain.

The guideline addresses the following four areas:

1) determining whether or

not to initiate opioids for pain, 2) selecting opioids and determining opioid dosages, 3) deciding duration of initial opioid prescription

and conducting follow-up, and 4) assessing risk and addressing potential harms of opioid use.

The guideline addresses the following

1) determining whether or not to initiate opioids for pain, 2) selecting opioids and determining opioid dosages, 3) deciding

duration of initial opioid prescription and conducting follow-up, and 4) assessing risk and addressing potential harms of opioid

Warnings and Safety Labeling:

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Capital Resources

of December 31, 2021, we had six full-time employees and six consultants.

of December 31, 2022, we had seven full-time employees and five consultants.

Of these, five have a Ph.D.

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or covered by collective bargaining agreements, and we believe our relationship with our employees is good.

We intend to add additional

full-time employees along with additional clinical support staff in 2022, and to expand our commercial sales force beginning 2023.

July 2021 Ensysce appointed David J.

Kovacs to a new position of VP Public Policy and David Tanzer to a new position of VP Strategic

Kovacs has extensive experience shaping policy and setting strategy for disruptive companies in pharmaceutical and technology

He has served in various roles for public companies, including Vinco Ventures (NASDAQ:

BBIG) and AudioEye, Inc.

Previously, Mr.

Kovacs held senior roles in private equity and investment banking, including at Blackstone Group, Citigroup, and the

Hinduja Group.

Tanzer is an accomplished business executive specializing in helping companies with innovative intellectual property

and technology maximize their potential.

He has 25 years of diverse experience in the healthcare and media sectors, including as CEO

or President of eight companies, service on nine company boards, and working at private equity firms, including Lee Equity Partners and

Elevation Partners.

Tanzer previously was President of PDR Network, publisher of the Physicians’ Desk Reference, the authoritative

source of drug safety information for prescribers.

Linda Pestano joined Ensysce in October 2021, as Chief Development Officer.

Pestano has worked throughout her career to guide

the development of novel therapeutics to improve patient outcomes and quality of life.

Pestano received her PhD from Tuffs University

and undertook a Post-Doctoral Fellowship with Dana Farber Cancer Institute at the Harvard Medical School in Boston.

She has been instrumental

in guiding new therapies, including small molecules, nucleic acids, and biologicals through development into clinical trials.

expertise spans lead development, pre-clinical and translational studies, and interacting with multiple regulatory agencies.

joins Ensysce with 20 years of experience developing vaccines, drugs and novel biologics for a diverse range of indications.

Identification

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Medical Officer

Business Officer

presented as of December 31, 2022

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Jeffrey Millard, Ph.D.

served as our Chief Operating Officer since January 2019.

Millard has both academic and industrial experience in chemistry and pharmaceutical

sciences covering all aspects of chemistry, manufacturing, and controls, or CMC.

He has been involved in both start-up biotech as well

as small and mid-sized public biopharmaceutical companies.

Millard has been directly responsible for research and development activities

and writing of more than seven IND submissions and Investigational Medicinal Product Dossiers, or IMPDs.

He has directed the CMC efforts

from discovery and in-licensing through commercial launch activities.

His experience covers the application programming interface, or

API, lifecycle (from synthetic route scouting, process chemistry, analytical chemistry development and validation, cGMP production and

release of API, to QbD and process validation), and drug product development through manufacture.

Millard received a Bachelor of

Arts from Rice University and a Ph.D.

has served as our Chief Operating Officer since January 2019.

Millard has both academic and industrial

experience in chemistry and pharmaceutical sciences covering all aspects of chemistry, manufacturing, and controls, or CMC.

involved in both start-up biotech as well as small and mid-sized public biopharmaceutical companies.

Millard has been directly responsible

for research and development activities and writing of more than seven IND submissions and Investigational Medicinal Product Dossiers,

He has directed the CMC efforts from discovery and in-licensing through commercial launch activities.

His experience covers

the application programming interface, or API, lifecycle (from synthetic route scouting, process chemistry, analytical chemistry development

and validation, cGMP production and release of API, to QbD and process validation), and drug product development through manufacture.

Millard received a Bachelor of Arts from Rice University and a Ph.D.

in Pharmaceutical Sciences from the University of Arizona.

Linda Pestano, Ph.D.

Capital Resources ” for Dr.

Pestano’s biographical information.

Linda Pestano joined Ensysce in October 2021, as Chief Development Officer.

Pestano has worked throughout her career to guide

the development of novel therapeutics to improve patient outcomes and quality of life.

She has 20 years of experience developing vaccines,

drugs and novel biologics for a diverse range of indications.

She has been instrumental in guiding new therapies, including small molecules,

nucleic acids, and biologicals through development into clinical trials.

Pestano’s expertise spans lead development, pre-clinical

and translational studies, and interacting with multiple regulatory agencies.

Pestano received her PhD from Tufts University and

undertook a Post-Doctoral Fellowship with Dana Farber Cancer Institute at the Harvard Medical School in Boston.

Schmidt, Ph.D ., has served as our Chief Medical Officer since January 2016.

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Currently Dr.

Schmidt serves as an expert on pain

medicine pharmaceutical development with pharmaceutical and biotech companies throughout North America, Europe, Asia, Latin America,

Schmidt serves as an expert on

pain medicine pharmaceutical development with pharmaceutical and biotech companies throughout North America, Europe, Asia, Latin America,

and Australia.

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California-San Francisco.

Wright MSE, MBA has served as our Chief Business Officer since January 2016.

Wright is the Chief Executive Officer of Magnostics,

Ltd, a superparamagnetic nano-material company based in Dublin, Ireland.

Previously, he served as Venture Partner at Ren Capital Partners

(“ Ren Capital ”), a healthcare fund of funds based in Beijing.

Prior to Ren Capital, he was a strategic advisor to

Bangkok Dusit Medical Service, the largest healthcare conglomerate in Southeast Asia, assisting in drug commercialization efforts.

Wright was Managing Director at Newstock Capital, an intellectual property investment advisory firm based in Stockholm, Sweden.

at Newstock, he worked with venture capital and corporate funds on divestitures, mergers and acquisitions, patent transactions, licensing

and infringement.

Previously Mr.

Wright was fund manager for General Electric / Technology Ventures where he managed an intellectual

property healthcare fund.

He was the Co-Founder and Chief Executive Officer of TherimuneX, a company that has been developing endogenous

lipopeptides for their immune regulating properties.

Wright was principal of Guardian Technology Partners, a chemical and life sciences

intellectual property advisory firm that was sold to investment bank Boenning and Scattergood.

Wright started his career on the business

development team of Endo Pharmaceuticals, plc.

Wright has over 24 years of experience spanning start-up, fast growth pharmaceutical

companies combined with intellectual property and healthcare investment acumen from varied international markets.

Wright holds a

Master of Science in Engineering, Management of Technology with a focus of biotechnology from University of Pennsylvania’s School

of Engineering and Applied Sciences and Wharton School of Business, and a Master of Business Administration from London School of Economics

TRIUM program.

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-K

Item 1. Business