What changed in this filing

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Item 1. Business

2021-04-01 compared with 2020-03-25 · 1052 added, 316 removed, 0 unchanged (100% of the section changed)

This annual report contains forward-looking statements.

These statements relate to either future events or our future financial performance.

In some cases, you may be able to identify forward-looking statements by terms such as “may,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms or other

synonymous terminology.

These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in the section entitled “Risk Factors,” that may cause our or our industry’s actual results,

levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

Any forward-looking statements made by or on our behalf are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity,

performance or achievements.

Except as required by applicable law, including the securities laws of the United States, we do not intend, and we do undertake any obligation, to revise or update any of the forward-looking statements to match actual

Readers are urged to carefully review and consider the various disclosures made in this report, which aim to inform interested parties of the risks factors that may affect our business, financial condition, results of operations and

Our financial statements are stated in United States Dollars (US$) and are prepared in accordance with United States Generally Accepted Accounting Principles

As used in this annual report, the terms the “Company,” “we,” “us,” “our” and similar references refer to AMERI Holdings Inc., and its subsidiaries together,

unless the context indicates otherwise.

We specialize in delivering SAP cloud, digital and enterprise services to clients worldwide.

SAP is a leader in providing enterprise resource planning (“ERP”) software and

technologies to enterprise customers worldwide.

We deliver a wide range of solutions and services across multiple domains and industries.

Our services center around SAP and include technology consulting, business intelligence, cloud services,

application development/integration and maintenance, implementation services, infrastructure services, and independent validation services, all of which can be delivered as a set of managed services or on an on-demand service basis, or a

combination of both.

Our SAP focus allows us to provide technological solutions to a broad base of clients.

We are headquartered in Suwanee, Georgia, and have offices across the United States, which

are supported by offices in India and Canada.

Our model inverts the conventional global delivery model wherein offshore information technology (“IT”) service providers are based abroad and maintain a minimal presence in the United States.

strong SAP focus, our client partnerships anchor around SAP cloud and digital services.

In 2017, we signed a strategic partnership agreement with NEC America to offer SAP S/4 HANA (a next generation enterprise system) migration services.

partnership will allow us to offer our clients a broader spectrum of services.

Our primary business objective is to provide our clients with a competitive advantage by enhancing their business capabilities and technologies with our expanding consulting

services portfolio.

Our strategic acquisitions allow us to bring global service delivery, SAP S/4 HANA, SAP Business Intelligence, SAP Success Factors, SAP Hybris and high-end SAP consulting capabilities to a broader geographic market and customer

We continue to leverage our growing geographical footprint and technical expertise to simultaneously expand our service and product offering.

Our goal is to identify business synergies that will allow us to bring new services and products

from one subsidiary to customers at our other subsidiaries.

While we generate revenues from the consulting businesses of each of our acquired subsidiaries, we believe that additional revenues will be generated through new business relationships and

services developed through our business combinations.

We were incorporated under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which was a shell company immediately prior to our

completion of a “reverse merger” transaction on May 26, 2015, in which we caused Ameri100 Acquisition, Inc., a Delaware corporation and our newly created, wholly owned subsidiary, to be merged with and into Ameri and Partners Inc.

Partners”), a Delaware corporation (the “Merger”).

As a result of the Merger, Ameri and Partners became our wholly owned subsidiary with Ameri and Partners’ former stockholders acquiring a majority of the outstanding shares of our common stock.

Merger was consummated under Delaware law, pursuant to an Agreement of Merger and Plan of Reorganization, dated as of May 26, 2015 (the “Merger Agreement”), and in connection with the Merger we changed our name to AMERI Holdings, Inc.

business under the brand name “Ameri100”.

Ameri Holdings, Inc., along with its eleven subsidiaries, Ameri and Partners, Ameri Consulting Service Private Ltd., Ameri100 Georgia Inc.

(“Ameri Georgia”), Bellsoft India

Solutions Private Ltd., Ameri100 Canada Inc.

(formerly BSI Global IT Solutions Inc.), Linear Logics, Corp., Ameri100 Virtuoso Inc.

(“Virtuoso”), Ameri100 Arizona LLC (“Ameri Arizona”), Bigtech Software Private Limited (“Bigtech”), Ameri100

California Inc.

(“Ameri California) and Ameritas Technologies India Private Limited, provides SAP cloud, digital and enterprise services to clients worldwide.

Organizational Chart

Recent Developments

Spin-Off Transaction

Stock Purchase Agreement

On January 10, 2020, we and Ameri100 Inc.

(“ Buyer ”) entered into a Stock Purchase Agreement (the “ Agreement ”) pursuant to which, among other things and subject to the satisfaction or

waiver of specified conditions, the Company will sell to Buyer and Buyer will purchase from the Company one hundred percent (100%) of the outstanding equity interests (the “ Purchased Shares ”) of Ameri100 Holdco, Inc.

(“Holdco”) (the “ Spin-Off ”).

Prior to the Spin-Off Closing (as defined below), the Company will consummate a reorganization (the “ Reorganization ”) pursuant to which it will contribute, transfer and convey to Holdco all

of the issued and outstanding equity interests of the existing subsidiaries of the Company, constituting the entire business and operations of the Company and its subsidiaries (the “ Transferred Legacy Business ”).

At the Spin-Off Closing,

in exchange for the Purchased Shares, all of the issued and outstanding shares of Series A preferred stock of the Company shall be redeemed for a number of shares of Series A preferred stock of Buyer (“ Buyer Preferred Stock ”) equal to the

sum of (a) 431,333 shares of Buyer Preferred Stock plus (b) an additional number of payable-in-kind shares of Buyer Preferred Stock based on a 2% annual interest rate, compounding quarterly, from January 1, 2020 through and including the date of

the Spin-Off Closing on the number of shares set forth in clause (a).

Each party’s obligation to consummate the Spin-Off is subject to certain conditions including, but not limited to the consummation of the Reorganization and the consummation of the Amalgamation (as

defined below).

Exchange Agreements

In connection with the Agreement, on January 10, 2020, the Company entered into Exchange Agreements (each, an “ Exchange Agreement ”) with certain creditors of the Company and its subsidiaries

(each, a “ Converted Debt Holder ”), pursuant to which the Company issued in a private offering a total of 599,600 shares of its common stock (the “ Exchange Shares ”) to such Converted Debt Holders at a price per share of $2.495 in

satisfaction of $1,496,000 of the obligations owed by the Company to such Converted Debt Holders, with the remaining $1,000,000 owed to such Converted Debt Holders, plus interest (at an increased rate), due at the closing of the Amalgamation (or

the earlier of the termination of the Amalgamation Agreement (as defined below) or 181 days after the date of the Amalgamation Agreement.

Amalgamation Transaction

Amalgamation Agreement

On January 10, 2020, the Company entered into an Amalgamation Agreement (the “ Amalgamation Agreement ”) with Jay Pharma Merger Sub, Inc.

a company organized under the laws of Canada and a wholly-owned subsidiary of the Company (“ Merger Sub ”), Jay Pharma Inc., a company organized under the laws of Canada (“ Jay Pharma ”), Jay Pharma ExchangeCo.,

a company organized under the laws of British Columbia and a wholly-owned subsidiary of the Company (“ ExchangeCo ”), and Barry Kostiner,

as the Company Representative.

The Amalgamation Agreement provides that, upon the terms and subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub and Jay

Pharma will be amalgamated and will continue as one corporation (“ AmalCo ”) under the terms and conditions prescribed in the Amalgamation

Agreement (the “ Amalgamation ”), AmalCo shall be a direct wholly-owned subsidiary of ExchangeCo and an indirect wholly-owned subsidiary of the

At the effective time of the Amalgamation (the “ Effective Time ”), all outstanding shares of Jay Pharma (the “ Jay Pharma Shares ”) will be converted into the right to receive such number of

shares of common stock of the Company representing approximately 84% of the post-closing company’s issued and outstanding shares of common stock (calculated prior to the issuance of those new shares of common stock) (“ Resulting Issuer Common Stock ”).

The Jay Pharma Shares will initially be converted into either (a) ExchangeCo Exchangeable Shares (as defined in the

Amalgamation Agreement) or (b) ExchangeCo Special Shares (as defined in the Amalgamation Agreement) which in turn will be exchangeable into freely-trading shares of Resulting Issuer Common Stock.

Additionally, each outstanding Jay Pharma stock

option will be converted into and become an option to purchase the number of shares of Resulting Issuer Common Stock equal to the Exchange Ratio (as defined in the Amalgamation Agreement) and each outstanding Jay Pharma warrant will be

converted into and become a warrant to purchase the number of shares of Resulting Issuer Common Stock equal to the Exchange Ratio.

The Amalgamation Agreement also contains covenants regarding the Company and Jay Pharma using their respective reasonable best efforts to obtain all required

governmental and regulatory consents and approvals.

Each party’s obligation to consummate the Amalgamation is subject to certain conditions including, but not limited to:

the approval of each of the Company’s and Jay Pharma’s shareholders;

the consummation of the Spin-Off;

the entering into of certain ancillary agreements by and between the Company and ExchangeCo;

the approval of the NASDAQ to approve for listing the common stock of the resulting company.

The Amalgamation Agreement contains certain customary termination rights by either the Company or Jay Pharma, including if the Amalgamation is not

consummated within 180 days of the date of the Amalgamation Agreement.

If the Amalgamation Agreement is terminated under certain circumstances, the Company may be obligated reimburse Jay Pharma for expenses incurred in an amount

not to exceed $500,000.

Ameri Industry

We operate in an intensely competitive IT outsourcing services industry, which competes on quality, service and costs.

Though we are able to differentiate our company on all of

these axes, our India-based capabilities ensure that labor arbitrage is our fundamental differentiator.

Most offshore IT services providers have undertaken a “forward integration” to boost their capabilities and presence in their client geographies

(large offshore presence with a small local presence).

Conversely, large U.S.

system integrators focus on “backward integration” to scale and boost their offshore narrative (offshore being the “back office” for the local operations).

Today, the IT

services industry is marked by the following characteristics:

Characteristic

Mature Market

• Most large global companies have already outsourced what they wanted to outsource.

Commoditized Business Model

• North America and Europe continue to be the markets with attractive spending potential.

However, increased

regulations and visa dependencies prove to be a major drawback of the model.

• The benefits realized from the business model are largely based on labor arbitrage, productivity

benefits and portfolio restructuring.

These contours have changed due to commoditization.

• Extremely rapid changes in technology are forcing IT services–traditionally an outsourcing business—to adopt an

insourcing model.

Rapid Technology Shifts

• Cloud services, robotic process automation, artificial intelligence and internet of things are increasingly in

demand as part of outsourcing engagements.

Smart robots increasingly operate in the cloud, and a ‘labor-as-a-service’ approach has emerged, as clients and providers find that intelligent tools and virtual agents can be easily and flexibly

hosted on cloud platforms.

• Social media, cloud computing, mobility and big data will continue to be mainstays for any IT

• The convergence of cloud computing, virtualization (applications and infrastructure) and

utility computing is around the corner.

The ability of a vendor to offer an integrated basket of services on a SaaS model, will be a key differentiator.

• Enterprises are becoming more digital.

There is a strong convergence of human and machine

intelligence thanks to drivers like advanced sensors and machine learning.

Operations and technology are converging.

Contracts & Decision Making

• Large multi-year contracts will be renegotiated and broken down into shorter duration contracts and will involve

multiple vendors rather than sole sourcing.

• The ability to demonstrate value through Proof of Concepts (POCs) and willingness to offer

outcome based pricing are becoming critical considerations for decision making, Requests for Proposal (RFP)-driven decisions are increasingly rare.

The SAP Industry

SAP as an ERP and Cloud product has become an industry by itself.

The core SAP enterprise offering has been reinforced with cloud-based products that make the entire SAP ecosystem

extremely attractive from our perspective due to the following attributes:

The alignment of SAP to enterprises is extremely strong.

Given the reliance of enterprises on applications, clients tend to make long-term bets on SAP as an enterprise solution.

According to the September 2014 “HfS Blueprint Report” from by HfS Research Ltd., the SAP market is a multi-billion-dollar market that is very fragmented (there are over 5,000 consulting firms), with the

three largest service providers capturing an increasing share of the market.

A significant number of SAP customers must move to S/4 HANA by 2025.

Our solutions deliver significant business efficiency outcomes through turnkey projects, consulting and offshore services.

We believe that our strategic service portfolio, deep industry experience and strong global

talent pool offer a compelling proposition to clients.

In 2017 we acquired ATCG Technology Solutions, Inc., which has become our wholly-owned subsidiary Ameri California.

In 2016, we acquired three companies:

Virtuoso, L.L.C.

and DC&M Partners, L.L.C.in the U.S.

(now Virtuoso and Ameri Arizona, respectively) and Bigtech in India.

These strategic acquisitions

have brought offshore delivery, SAP S/4 HANA, SAP SuccessFactors, SAP Hybris and high-end SAP consulting capabilities to our service portfolio.

Our Portfolio of Service Offerings

Our portfolio of service offerings expanded significantly since 2016 with our acquisitions of Ameri Georgia, Ameri Arizona, Ameri California, Virtuoso and Bigtech.

Our current portfolio of services is divided into three categories:

Cloud Services

An increasing trend in the IT services market is the adoption of cloud services.

Historically, clients have resorted to on-premise software solutions, which required capital

investments in infrastructure and data centers.

Cloud services enable clients to build and host their applications at much lower costs.

Our services offerings leverage the low cost and flexibility of cloud computing.

We have expertise in deploying SAP’s public, private and hybrid cloud services, as well as SAP S/4 HANA, SAP SuccessFactors and SAP Hybris cloud migration services.

Our teams are experienced in the rapid delivery of cloud services.

We perform SAP application and cloud support and SAP cloud development.

Additionally, we provide cloud automation solutions that

focus on business objectives and organizational growth.

Digital Services

We have developed several cutting-edge mobile solutions, including Simple Advance Planning and Optimization (“APO”) and SAP IBP/S&OP Mobile Analytics App.

The Simple APO

mobile application (app) provides sales professionals with real-time collaboration capabilities and customer data, on their mobile devices.

It increases the efficiency of the sales process and the accuracy of customer needs forecasting.

mobile app enables the real-time management and analysis of sales and operations planning (S&OP) related data from mobile devices.

SAP is an implementation partner for this app.

SAP has recognized the app’s value to the ecosystem, as S&OP

apps are complex and difficult to design.

We are also active in robotic process automation (“RPA”), which leverages the capability of artificially intelligent software agents for business process automation.

expertise in automating disparate and redundant data entry tasks by configuring software robots that seamlessly integrate with existing software systems.

We also provide RPA solutions for reporting and analysis and deliver insights into business

functions by translating large data into structured reports.

Lastly, we have a working partnership with Blue Prism, a leading RPA solutions provider, which makes it possible for us to automate up to one-third of all standard back-office operations.

Enterprise Services

We design, implement and manage Business Intelligence (“BI”) and analytics solutions.

BI helps our clients navigate the market better by identifying new trends and by targeting

top-selling products.

We also enable clients to use BI for generating instant financial reports and analytics of customer, product and cost information over time.

In addition, we provide solutions for metadata repository, master data management

and data quality.

Finally, we determine BI demands across various platforms.

Other key enterprise services that we offer include consulting services for global and regional SAP implementations, SAP/IT solution advisory and architectural services, project

management services, IT/ERP strategy and vendor selection services.

Often clients have relied on us to deliver services in non-SAP packages, as well.

The integration of each of our acquisitions into our business enterprise requires establishing our company’s standard operating procedures at each acquired entity, seamlessly transitioning each

acquired entity’s branding to the “Ameri100” brand and assessing any necessity to transition account management.

The integration process also requires us to evaluate any product-line expansions made possible by the acquired entity and how to bring

new product lines to the broader customer base of the entire Company.

With the integration of each acquisition, we face challenges of maintaining cross-company visibility and cooperation, creating a cohesive corporate culture, handling unexpected

customer reactions and changes and aligning the interests of the acquired entity’s leadership with the interests of the Company.

Sales and Marketing

We combine traditional sales with our strength in industries and technology.

Our sales function is composed of direct sales and inside sales professionals.

Both work closely with

our solutions directors to identify potential opportunities within each account.

We currently have over 100+ active clients.

Using a consultative selling methodology (working with clients to prescribe a solution that suits their need in terms of

efficiency, cost and timelines), target prospects are identified and a pursuit plan is developed for each key account.

We utilize a blended sales model that combines consultative selling with traditional sales methods.

Once the customer has engaged

us, the sales, solutions and marketing teams monitor and manage the relationship with the help of customer relationship management software.

Our marketing strategy is to build a strong, sustainable brand image for our company, position us in the SAP arena and facilitate business opportunities.

We use a variety of

marketing programs across traditional and social channels to target our prospective and current customers, including webinars, targeted email campaigns, co-sponsoring customer events with SAP to create customer and prospect awareness, search engine

marketing and advertising to drive traffic to our web properties, and website development to engage and educate prospects and generate interest through white papers, case studies and marketing collateral.

Revenues and Customers

We generate revenue primarily through consulting services performed in the fulfillment of written service contracts.

The service contracts we enter into generally fall into two

(1) time-and-materials contracts and (2) fixed-price contracts.

When a customer enters into a time-and-materials or fixed-price, (or a periodic retainer-based) contract, we recognize revenue in accordance with an evaluation of the deliverables

in each contract.

If the deliverables represent separate units of accounting, we then measure and allocate the consideration from the arrangement to the separate units, based on vendor-specific objective evidence of the value for each deliverable.

The revenue under time-and-materials contracts is recognized as services are rendered and performed at contractually agreed upon rates.

Revenue pursuant to fixed-price contracts

is recognized under the proportional performance method of accounting.

We routinely evaluate whether revenue and profitability should be recognized in the current period.

We estimate the proportional performance on our fixed-price contracts on a

monthly basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.

For the twelve months ended December 31, 2019 and December 31, 2018, sales to five major customers accounted for approximately 48% and 39% of our total revenue, respectively.

Technology Research and Development

We regard our services and solutions and related software products as proprietary.

We rely primarily on a combination of copyright, trademark and trade secret laws of general

applicability, employee confidentiality and invention assignment agreements, distribution and software protection agreements and other intellectual property protection methods to safeguard our technology and software products.

We have not applied

for patents on any of our technology.

We also rely upon our efforts to design and produce new applications and upon improvements to existing software products to maintain a competitive position in the marketplace.

We did not make any material expenditures on research or development activities for the twelve months ended December 31, 2019 and December 31, 2018.

Strategic Alliances

Through our Lean Enterprise Architecture Partnership (“LEAP”) methodology, we have strategic alliances with technology specialists who perform services on an as-needed basis for

We partner with niche specialty firms globally to obtain specialized resources to meet client needs.

Our business partners include executive recruiters, staffing firms and niche technology companies.

The terms of each strategic alliance

arrangement depend on the nature of the particular partnership.

Such alliance arrangements typically set forth deliverables, scope of the services to be delivered, costs of services and terms and conditions of payment (generally 45 to 90 days for

payment to be made).

Each alliance arrangement also typically includes terms for indemnification of our company, non-solicitation of each partner’s employees by the other partner and dispute resolution by arbitration.

Alliances and partnerships broaden our offerings and make us a one-stop solution for clients.

Our team constantly produces services that complement our portfolio and build

strategic partnerships.

Our partner companies range from digital marketing strategy consulting firms to large infrastructure players.

On any given project we evaluate a client’s needs and make our best effort to meet them with our full-time specialists.

However, in certain circumstances, we may need to go

outside the Company, and in this case we approach our strategic partners to tap into their pools of technology specialists.

Project teams are usually composed of a mix of our full time employees and outside technology specialists.

Occasionally, a

project team may consist of a Company manager and a few outside technology specialists.

While final accountability for any of our projects rests with the Company, the outside technology specialists are incentivized to successfully complete a

project with project completion payments that are in addition to hourly billing rates we pay the outside technology specialists.

The large number of competitors and the speed of technology change make IT services and outsourcing a challenging business.

Competitors in this market include systems integration

firms, contract programming companies, application software companies, traditional large consulting firms, professional services groups of computer equipment companies and facilities management and outsourcing companies.

Examples of our competitors

in the IT services industry include Accenture, Cartesian Inc., Cognizant, Hexaware Technologies Limited, Infosys Technologies Limited, Mindtree Limited, RCM Technologies Inc., Tata Consultancy Services Limited, Virtusa, Inc.

and Wipro Limited.

We believe that the principal factors for success in the IT services and outsourcing market include performance and reliability;

quality of technical support, training and

responsiveness to customer needs;

reputation and experience;

financial stability and strong corporate governance;

and competitive pricing.

Some of our competitors have significantly greater financial, technical and marketing resources and/or greater name recognition, but we believe we are well positioned to

capitalize on the following competitive strengths to achieve future growth:

well-developed recruiting, training and retention model;

successful service delivery model;

broad referral base;

continual investment in process improvement and knowledge capture;

investment in research and development;

strong corporate governance;

custom strategic partnerships to provide breadth and depth of services.

As of December 31, 2019, our total headcount was 397, which includes employees and billable subcontractors.

Our employees are not part of a collective bargaining arrangement and we believe our

relations with our employees are good.

Government Regulations

In the United States and India, we are subject to or affected by international, federal, state and local laws, regulations and policies, including anti-bribery rules, trade sanctions, data privacy requirements, labor laws

and anti-competition regulations, which are constantly subject to change.

The descriptions of the laws, regulations and policies that follow are summaries and should be read in conjunction with the texts of the laws and regulations.

descriptions do not purport to describe all present and proposed laws, regulations and policies that affect our businesses.

We believe that we are in compliance with these laws, regulations and policies.

Although we cannot predict the effect of changes to the existing laws, regulations and policies or of the proposed laws,

regulations and policies that are described below, we are not aware of proposed changes or proposed new laws, regulations and policies that will have a material adverse effect on our business.

We operate in jurisdictions in which local business practices may be inconsistent with international regulatory requirements, including anti-corruption and anti-bribery regulations prescribed under the U.S.

Corrupt Practices Act (“FCPA”), which, among other things, prohibits giving or offering to give anything of value with the intent to influence the awarding of Government contracts.

Also, India’s Prevention of Corruption (Amendment) Bill 2013

(“PCA”) prohibits giving bribe to a public servant.

To help ensure compliance with these laws and regulations, we have adopted specific risk management and compliance practices and policies, including a specific policy addressing the FCPA.

Jay Pharma Business Overview

Jay Pharma is an evidence-based pharmaceutical company, dedicated to developing innovative cannabinoid-based products and combination therapies to improve the quality of life for those living with serious and chronic

conditions, initially focusing on oncology care.

Jay Pharma seeks to improve the lives of persons suffering from cancer, initially by developing cancer care and wellness products for persons suffering from certain side effects of cancer and cancer

Jay Pharma currently intends to offer such palliative cancer care and wellness products, once approved for commercialization in the United States, if ever.

Jay Pharma is also aiming to advance a pipeline of novel cannabinoid combination

therapies for hard-to-treat cancers, including glioblastoma multiforme (GBM).

Jay Pharma intends to bring leading oncology clinicians and researchers, academic and industry partners, proprietary products and data, and eventually a robust pipeline

of product candidates, to improve quality of life and provide symptomatic relief to cancer patients.

In developing its product candidates, Jay Pharma intends to focus solely on cannabinoids derived from hemp and synthetic materials containing no tetrahydrocannabinol (THC) in order to comply with U.S.

Of the potential cannabinoids to be used in therapeutic formulations, THC, which is responsible for the psychoactive properties of marijuana, can result in undesirable mood effects.

Cannabidiol (CBD) and cannabigerol (CBG), on the

other hand, are not psychotropic and are therefore more attractive candidates for translation into therapeutic practice.

In the future, Jay Pharma may utilize cannabinoids that are derived from cannabis plants, which may contain THC;

Pharma only intends to do so in jurisdictions where THC is legal.

Available Information

Our executive office is located at 5000 Research Court, Suite 750, Suwanee, Georgia 30024.

Our telephone number is (770) 935-4152 and our website is www.ameri100.com.

free access to various reports that we file with or furnish to the U.S.

Securities and Exchange Commission through our website, as soon as reasonably practicable after they have been filed or furnished.

were incorporated under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which was a shell

company immediately prior to the completion of a “reverse merger”

transaction on May 26, 2015, whereby Ameri100 Acquisition,

Inc., a Delaware corporation and newly created, wholly owned subsidiary, was merged with and into Ameri and Partners Inc.

(“Ameri

and Partners”), a Delaware corporation (the “2015 Merger”).

As a result of the 2015 Merger, Ameri and Partners became

Ameri’s wholly owned subsidiary with Ameri and Partners’

former stockholders acquiring a majority of the outstanding shares

of Ameri common stock.

The 2015 Merger was consummated under Delaware law pursuant to an Agreement of Merger and Plan of Reorganization,

dated as of May 26, 2015 (the “2015 Merger Agreement”), and in connection with the 2015 Merger, Ameri changed its name to

AMERI Holdings, Inc.

Ameri did business under the brand name “Ameri100”.

Ameri, along with its eleven operating subsidiaries,

provided SAP cloud, digital and enterprise services to clients worldwide.

Ameri business ceased to be part of the Company on December 30, 2020, pursuant to the Spin-Off.

On December 30, 2020, we completed the

Offer and changed our name to “Enveric Biosciences, Inc.”

Our principal corporate office is located at Enveric Biosciences,

Inc., 4851 Tamiami Trail N, Suite 200, telephone (239) 302-1707.

Our internet address is https://www.enveric.com/, and the information

included in, or linked to our website is not part of this prospectus.

We have included our website address in this prospectus solely

as a textual reference.

are an early-development-stage biosciences company with an initial focus on developing innovative, evidence-based prescription

products and combination therapies containing cannabinoids to address unmet needs in cancer care.

We seek to improve the lives

of patients suffering from cancer, initially by developing palliative and supportive care products for people suffering from certain

side effects of cancer and cancer treatment such as pain or skin irritation.

We currently intend to offer such palliative and

supportive care products in the United States, following approval through established regulatory pathways.

are also aiming to advance a pipeline of novel cannabinoid combination therapies for hard-to-treat cancers, including glioblastoma multiforme

(GBM) and several other indications which are currently being researched.

intend to bring together leading oncology clinicians, researchers, academic and industry partners so as to develop both external proprietary

products and a robust internal pipeline of product candidates aimed at improving quality of life and outcomes for cancer patients.

intend to evaluate options to out-license its proprietary technology as it moves along the regulatory pathway and evaluates the building

of a small, targeted selling organization and will potentially utilize a hybrid approach based on the product indication and the market

developing our product candidates, we intend to focus on cannabinoids derived from hemp, other botanical sources, and synthetic materials

containing no tetrahydrocannabinol (THC) in order to comply with U.S.

federal regulations.

Of the potential cannabinoids to be used in

therapeutic formulations, THC, which is responsible for the psychoactive properties of marijuana, can result in undesirable mood effects.

Cannabidiol (CBD) and cannabigerol (CBG), on the other hand, are not psychotropic and are therefore more attractive candidates for translation

into therapeutic practice.

In the future, we may utilize cannabinoids that are derived from cannabis plants, which may contain THC;

we only intend to do so in jurisdictions where THC is legal.

These product candidates will then be studied through a typical Food and

Drug Administration (“FDA”) drug approval process.

believe that we offer the following key distinguishing characteristics:

Dedication to Prescription Cancer Supportive Care .

We believe that we are one of the only companies currently developing evidence-based

prescription-only therapies containing cannabinoids that are exclusively focused on the unique unmet needs of cancer patients.

intend to develop such therapies by conforming its product candidates to GMP and obtaining FDA approval for such product candidates.

Patient-Centric

Product Development .

We are focusing on a patient-centric approach to our product development that will uniquely position us

to meet the needs of oncology patients.

Mover Advantage .

We believe we are among the first companies working towards creating a leading brand utilizing cannabinoids

in oncology supportive care.

We seek to build upon our first mover advantage and expertise in cannabinoid research to accelerate

the discovery, development, and commercialization of therapies for persons affected by cancer that are safe, effective, and trusted

by patients and physicians globally.

Collaboration

with Global Research Partner .

We enjoy an exclusive license with our global cannabinoid research partner, Tikun Olam.

exclusive global rights to Tikun Olam’s proprietary treatment database and cannabinoid derivatives for the development of oncology-focused

pharmaceutical products.

We intend to leverage Tikun Olam’s large-scale human datasets and expand upon Tikun Olam’s existing

research by conducting new studies.

Sophisticated

Leadership Team and Scientific Advisors .

We have a world-class leadership team with extensive regulated pharmaceutical industry

backgrounds and deep expertise in oncology, skin and wound care, and clinical research.

In addition, we closely collaborate with

a broad network of leading physicians and scientists at major institutions.

Seeking Growth and Enhancement Opportunities .

We have identified a pathway to business growth and shareholder value creation

based on our planned development programs and eventually plan to leverage the credibility of that expertise into broader offerings.

We will continue to expand our opportunities to add assets that are complementary or accretive to our plans to serve patients through

acquisition and in-licensing.

Market Strategy and Business Approach

have a two-step go-to-market strategy:

Product Candidates :

Develop product candidates that target skincare-related ailments common among cancer patients, such as radiodermatitis,

chemotherapy-induced neuropathy, pruritus, rashes, and dry skin.

Advance novel cannabinoid combination therapies for persons with cancer, starting with programs in glioblastoma multiforme

believe that our existing approach to development, and a future ongoing emphasis on data collection, will differentiate us from our peers

and improve the quality of care we are able to provide.

pipeline of product candidates and key ongoing development programs are shown in the tables below:

Cannabinoid-Infused

Topical Product

related skincare conditions (e.g., radiodermatitis)

Center of Excellence

& Development / Discovery

Exploratory Phase 1/2 trial

+ Chemotherapy Combination Therapy

synthetic CBD extract given alone or in combination with clomiphene, concurrently with dose-dense Temolozomide chemotherapy

or progressive

Medical Center, Davidoff Institute of Oncology

& Development / Discovery

Phase 1/2 trial

Potential Development Programs

Target Indications

+ Chemotherapy Combination Therapy

in combination with CBD in patients with selected locally advanced or metastatic breast cancer treated with standard adjuvant chemotherapy

Department of Health and Human Services, based on 2013-2015 data, approximately 38% of men and women will be diagnosed with

cancer at some point during their lifetime.

In 2015, there were an estimated 15,112,098 people living with cancer in the U.S.

of new cases of cancer was 439 per 100,000 men and women per year.

widespread demand, the pharmaceutical market lacks products that address the unique supportive care needs of cancer patients.

we believe that research suggests that cannabis, as a palliative treatment for cancer patients, appears to be a well-tolerated option

to help patients cope with malignancy-related symptoms.

For example, researchers from the Soroka Medical Center in Beersheba, Israel

analyzed data gathered at Tikun Olam’s central clinic from cancer patients to whom medical cannabis was given for palliative-care

purposes between March 2015 and February 2017 (Schleiderab, European Journal of Internal Medicine, 2018).

The primary symptoms prior

to treatment reported among the patients to whom medical cannabis was given during the relevant timeframe were sleep problems (78.4%),

pain (77.7%), weakness (72.7%), nausea (64.6%), and lack of appetite (48.9%).

Approximately 51% of the applicable patients reported an

8 out of 10 on the pain scale.

Of the relevant patient population, 17% were given Tikun Olam’s cannabidiol-dominant strain “Avidekel,”

and after six months, 95.9% of patients reported improvement in their condition.

Note, however, that these are anecdotal reports, which

may or may not be indicative of the results that we may see from clinical studies conducted pursuant to an IND.

to a separate survey of 237 oncologists, 80% of these oncologists discussed medical cannabinoids with patients where nearly half recommended

them clinically (Braun IM, J Clin Oncol, 2018).

The same survey found that 67% of the oncologists viewed cannabinoids as a helpful adjunct

to standard pain management strategies, and 65% viewed cannabinoids as equally or more effective than standard treatments for anorexia

and cachexia.

also shows that most cancer patients have a strong interest in learning about cannabinoids during treatment.

According to the Washington

State Survey of Cancer Patients, 74% of surveyed patients wanted information from cancer care providers (Pergam SA, Cancer, 2017).

same survey found that 66% of patients had used cannabis in the past, 24% used in the last year, and 21% used in the last month.

cancer patients tend to be heavy cannabis users.

A survey of active cannabis users who have cancer (Pergam SA, Cancer, 2017) found that

74% used cannabis at least once a week, 56% used cannabis at least daily, and 31% used cannabis multiple times a day.

Active users consumed

cannabis primarily for physical symptoms such as pain and nausea or for psychological reasons such as coping with stress, depression,

and sleep difficulty.

a 2017 report, the National Academy of Sciences noted that, although cannabis has both therapeutic value and public health risks, there

is a systemic lack of research aimed at properly evaluating cannabis-based therapies.

The National Academy of Sciences offered recommendations

that included developing standards and benchmarks to guide cannabis research, addressing research gaps to evaluate the short- and long-term

health effects of cannabis use, improving surveillance capacity to ensure that sufficient data is available, and addressing regulatory

barriers to cannabis research and proposing strategies for supporting a comprehensive cannabis research agenda.

only 30% of oncologists felt sufficiently informed to make recommendations regarding medical cannabis, suggesting a large unmet opportunity

to educate oncologists and provide research that supports the safety and efficacy of Enveric product candidates.

Among the oncologists

who discussed medical cannabis with patients, 78% said that patients were the ones to express interest on most occasions.

for Premium Pricing

plan to conduct extensive clinical research in an effort to establish the safety of its prospective product candidates in cancer patients,

and, eventually, help to identify and/or develop cannabinoid medicines intended to reduce various unwanted side effects that commonly

affect cancer patients, target specific patient sequelae ( e.g.

, cancer pain, anxiety, or nausea), and target specific side effects

to the skin as a result of radiation and chemotherapy treatments.

believe that prescription only medicines containing cannabinoids (including product with hemp-based ingredients) will carry a price premium.

Upon obtaining FDA approval for our product candidates, we are striving to distinguish ourselves from a rising tide of cannabis industry

participants by:

product candidates specific to the side effects of cancer and cancer treatment, with a novel focus on skincare.

evidence-based best practices specific to cancer patients.

clinical research to support the safety and effectiveness of its product candidates in cancer patients.

FDA approval, as most over-the-counter (“OTC”) products sold are not FDA approved.

believe these will be an important differentiator for people with cancer and oncologists who are faced with high patient demand and in

still relatively novel, unproven field of medical cannabis.

Accordingly, we anticipate eventually being able to charge a premium for

those of our prospective product candidates that are successfully commercialized.

Further, more than one-third of cancer patients who

used medical cannabis were new users (K.

Martell, Curr Oncol, 2018), suggesting the potential to establish strong brand loyalty from

cancer patients and oncologists.

Currently Targeted by Enveric

Radiodermatitis

and Other Skin Conditions

therapy is considered an essential component of cancer treatment, with nearly 50% of cancer patients undergoing radiation therapy at

some point during the course of their treatments.

Radiodermatitis, or radiation-induced skin injury, is one of the most common adverse

effects of radiation therapy.

Of those receiving radiation therapy, approximately 90% experience some form of radiodermatitis.

skin is another common adverse side effect of certain cancer therapies.

For example, a recent study of patients being treated with chemotherapy

for breast cancer found that 57.9% of the patients reported dry skin.

Rashes are the most common side effect from targeted cancer therapies

with some treatments.

The incidence of rash varies based on the type of cancer and drug used.

For instance, skin rash occurs in up to

90% of patients treated with Erbitux, while other drugs may only affect half of patients.

Pruritus (itchy skin) is a common adverse side

effect of cancer therapies;

a recent survey of 379 cancer survivors reported that 36% experienced pruritus during treatment.

address the unique skincare needs of persons with cancer, we are seeking to formulate a cannabinoid-based ointment or other topical drug

product for skincare conditions, such as radiodermatitis (among other conditions, as applicable).

Standard of Care

current standard of care for radiodermatitis consists of a combination of preventative routines and symptomatic management based on dermatitis

Preventative skin care routines generally involve keeping the area clean and dry while avoiding skin irritants and unnecessary

friction or skin stress (Salvo, Curr Onvol, 2010;

Wong, Supp Care Canc, 2013).

Applying lanolin-free moisturizer 2-3 times a day throughout

the duration of treatment is also recommended, with some evidence suggesting that topical corticosteroids used after radiotherapy sessions

may provide some benefit as well (Salvo, Curr Onvol, 2010;

Wong, Supp Care Canc, 2013).

the use of these interventions, up to 85% of individuals will experience a moderate to severe skin reaction during their disease course

(Salvo, Curr Oncol, 2010).

This highlights the need for better preventative strategies to reduce the incidence and severity of skin toxicity.

The incomplete success of therapies to date likely relates to the multiple toxic mechanisms of radiation, including direct DNA toxicity,

oxidative stress, and both acute and chronic inflammatory reactions.

Therapies that can address multiple aspects of radiation toxicity

on the cellular level are likely to have the most success as prophylaxis and treatment for these patients.

Current Development Plans

intend to develop products that address unmet medical needs in palliative and supportive care for cancer patients.

The first product

will address radiodermatitis and will enter into clinical trials after an IND submission has been filed.

We then intend to seek FDA approval

via the new-drug-application (NDA 505(b)(1)) pathway.

Multiforme (GBM)

multiforme (GBM) is a highly aggressive and almost universally fatal disease.

Even with the most extensive surgical resections and the

most aggressive radiation and chemotherapy regimens, median overall survival is as low as 15- to 19-months (Stupp, NEJM, 2005).

is likely due, in part, to an intrinsic propensity for treatment resistance and, as a result, the essentially unavoidable event of tumor

The current prognosis for most patients necessitates significant advances in the standard of care to improve both overall

survival and patient quality of life.

believe that CBD has the potential to influence many of the key pathways involved in GBM pathogenesis, from tumor stemness and proliferation

to angiogenesis and local invasion.

GBM tumors express CB2 receptors, through which CBD and other cannabinoids are thought to exert their

anti-cancer efforts (Ellert-Miklaszewska, Adv Exp Med Biol, 2013).

The prospect of CBD used in combination with other pharmacologic interventions

holds promise for the treatment of GBM.

The development of clinical trials to evaluate the efficacy of CBD combination therapies may

represent an important step towards improving the clinical outcomes in a population of patients with few other effective therapeutic

to a study by Kenyon in 2018, seven out of seven patients with GBM experienced a positive clinical response, although four ultimately

succumbed to the disease.

CBD was hypothesized to be able to reduce the growth and survival of GBM cell lines by disrupting the normal

function of the cell, or cell cycle arrest, and the induction of programmed cell death, or apoptosis (Marcu, Mol Cancer Ther, 2010).

Cannabinoids have been shown to promote cancer cell death through the overproduction of a lipid subset, called ceramides, as accumulation

of ceramides in GBM cells may prevent the cell from functioning normally.

Additionally, the generation of unstable oxygen molecules,

or reactive oxygen species, can damage nearby molecules and trigger cell death (Dumitru, Front Mol Neurosci, 2018).

Enveric’s

Prospective Product Candidates

plan to evaluate a novel combination of CBD and an existing chemotherapeutic agent for treating GBM.

We intend to use, as part of the

study, a patent pending formulation developed by a partnership of three Israeli universities led by the Weizmann Institute, and now owned

proposed clinical cancer study plan consists of a Phase 1/2 study in Israel of oral synthetic CBD extract, given alone or in combination

with clomiphene concurrently with dose-dense temolozomide chemotherapy for patients with recurrent or progressive GBM, designed as an

open label, two-arm, randomized prospective study.

An initial dose limiting toxicity (DLT) cohort will be investigated in a phase 1 study

in order to rule out any toxicity related to the combination.

If successful, recruitment would continue, and then 40 patients would be

randomized into two arms, with 20 patients in each arm:

(i) synthetic CBD extract plus clomiphene and temolozomide, and (ii) synthetic

CBD extract plus temolozomide.

The primary endpoints would be progression free survival.

The progression of the disease would be determined

from a Response Assessment in Neuro-Oncology (RANO) and a tumor assessment based on MRI scans.

Safety parameters would include serious

adverse events and other adverse events as reported by the patients and caregivers.

of the date of annual report, all pre-clinical studies, and the draft clinical study protocol related to our clinical cancer program,

have been completed.

Tali Siegal has been selected as the primary investigator, and the protocol is currently under review by the

hospital’s internal review board (IRB).

The Israeli Ministry of Health, Center for Cannabis (Yakar) has given preliminary approval,

and Enveric is currently awaiting its primary approval.

intend to conduct a clinical study to validate the efficacy of topical cream or oral medication infused with high-potency CBD and/or

CBG to help prevent and treat the painful discomfort of chemotherapy-induced neuropathy.

Potential Development Projects

Care Product Candidates

the future, we may also develop additional prescription medicines that are derived from natural sources that are targeted to major cancer

treatment side effects, including other skin conditions, cancer-related distress, chemotherapy-induced nausea and vomiting (CINV), lack

of appetite, pain, and insomnia.

many patients, the concept of palliative care often carries a negative connotation, conjuring ideas and fears of the end of life.

the purpose of palliative care is to improve the patient experience and reduce suffering in all areas of life, including physical, emotional,

psychological, and spiritual well-being.

In fact, incorporating palliative care into cancer management has the potential to not only

improve quality of life, but may also prolong survival (Temei, NEJM, 2010;

Ferrell, J Clin Oncol, 2017).

We avoid the negative connotations

of palliative care by using the term “supportive care”.

physical ailments experienced by cancer patients vary widely based on the individual, the type and stage of cancer, and the choice of

Three of the most common and perhaps most debilitating complaints addressed by palliative care are chronic pain, chemotherapy-induced

nausea and vomiting, and severe body wasting (Reeve, JNCI, 2014).

Although efforts have been made to ameliorate these symptoms, many

patients do not achieve adequate relief.

The need for new therapeutics to improve these debilitating symptoms has gained increasing attention

in recent years.

seek to advance novel treatment for cancer based on a combination of cannabidiol (CBD) and chemotherapeutic agents, including clomiphene,

an anti-estrogen binding site (AEBS) inhibitor, which can regulate cell growth, with a potential for activity in multiple cancer cell

lines, including breast cancer, pancreatic cancer, and acute myeloid leukemia.

data suggests that combination therapies may improve the activity of certain chemotherapies or dendritic cell-based cancer immunotherapies,

potentially enabling more potent or longer-lasting therapeutic effects.

In multiple in vitro and in vivo models of solid

tumors and blood cancers, CBD has been shown to reduce tumor size, potential for invasion and metastasis, and development of new tumor-associated

blood vessels.

In combination with CBD, clomiphene has been shown to reduce cell viability and increase rates of programmed cell death

in certain cancer cell lines, while also inhibiting tumor growth in vivo .

cancer cells contain largely the same proteins and other targets as the healthy cells in the body, there are few cancer-specific druggable

chemotherapies often simply target all rapidly proliferating cells in the body.

While chemotherapy can be successful in suppressing

tumors, there are many side effects associated with use;

side effects may increase with higher doses.

The ability to provide the same

or greater therapeutic effect with a smaller overall dose of the chemotherapeutic agent may minimize the risk and severity of side effects

in subjects and allow for the treatment of certain patients with weakened immune systems.

Combination with AEBS Inhibitors

use of cannabis in cancer management has traditionally been relegated to symptomatic management, including as an analgesic, anti-emetic,

and appetite stimulant.

However, more recently, mounting evidence has suggested a therapeutic, anti-tumor effect of certain naturally

occurring cannabinoids.

Specifically, CBD has been shown to reduce tumor size, the potential for invasion and metastasis, and development

of new tumor-associated blood vessels in multiple in vitro and in vivo models of solid tumors and blood cancers (Ladin, Front Pharmacol,

Massi, Br J Pharmacol, 2013).

is also evidence to suggest that CBD used in combination with traditional chemotherapies and a certain class of compounds, the cholesterol

epoxide hydrolase (ChEH) / antiestrogen binding site (AEBS) inhibitors, may be more efficacious than CBD alone (Scott, Int J Oncol, 2017).

AEBS regulates cholesterol metabolism and, consequently, cell growth (Payre, Mol Cancer Ther, 2008).

AEBS inhibitors that we believe may be especially promising are clomiphene citrate and DPPE.

Clomiphene is an estrogen modulator typically

used to treat infertility.

However, in combination with CBD, clomiphene was recently shown to synergistically reduce cell viability and

increase rates of programmed cell death in certain cancer cell lines, while also inhibiting tumor growth in vivo (WO2017072773A1).

DPPE, on the other hand, is a tamoxifen derivative that is thought to sensitize cancer cells to the activities of chemotherapies.

a tumor grows and mutates, cancer cells can become resistant to therapies in several ways –

tumors can overexpress efflux pumps

that remove certain agents from the cell or can upregulate enzymes that metabolize and inactivate chemotherapies.

DPPE was shown to potentiate

the toxicity of multiple chemotherapeutic drugs by both mechanisms (Georges, Biochemical Pharm, 2014;

Brandes, Cancer Chemother Pharmacol,

Combination with Immunotherapies

cells (DCs) process antigen material and present it on the cell surface to the T-cells of the immune system.

A range of cancer immunotherapies

involving DCs have been used to generate tumor-specific immune responses that have had variable success in clinical trials.

may cause DCs to increase their production of IL-12 p70, an interleukin-12 (IL-12) family cytokine that may heighten the immune system’s

response against certain cancers.

IL-12 is closely linked to the activity of the immune system and is produced by DCs.

IL-12 can bring

T-cells and natural killer cells out of dormancy so that a heightened immune response against tumors is possible.

By aiding in the generation

of CD4+ (T helper cells), IL-12 also can also elicit a longer lasting and amplified anti-tumor response.

IL-12 has presented challenges in terms of its toxicity and dosage control and there is a need for generating heightened levels of IL-12,

particularly in immunocompromised patients.

Preclinical research suggests that CBD may induce DCs to increase their production of IL-12

are a party to certain license agreements as described below, and going forward it intends to both develop intellectual property and

license intellectual property from pharmaceutical and biotechnology companies and research institutions which would cover research stage

and clinical stage assets to build a pipeline of product candidates.

Olam In-License

hold limited rights to several plant patent applications as an in-licensee of Tikun Olam.

Olam employs evidence-based medicine and other best practices, and its products have been studied in numerous medical trials.

Tikun Olam’s

patient databases include 12,000+ persons treated across a variety of conditions, with a primary focus on cancer care.

hold limited rights to use the data included in the Tikun Olam patient database.

Biotech, Inc.

hold limited rights to patent applications owned by Diverse Biotech, Inc.

for the use of cannabinoids with five existing, standard-of-care

drugs via Diverse Biotech’s patent pending conjugate drug delivery platform.

Our rights extend to all fields of use.

engage in targeted research and development to apply such conjugates to alleviate the side effects that cancer patients experience, with

the goal of achieving novel therapeutic outcomes for patients.

Diverse Biotech, Inc.

patent application portfolio includes two patent applications licensed to us.

Those two patent applications disclose

conjugate chemistry that combines cannabinoids with existing drugs in conjugate form that we believe will provide differentiation in

use and efficacy from combination therapy of drugs and cannabinoids.

Patents and Patent Applications

own full rights to several families of patent applications covering the use of CBD in combination with current cancer treatments, both

broadly, as well as for specific cancer types, including the following:

Therapy (WO2017072773 and national phase filings in the U.S.

and other countries/regions) :

Combinations of compositions comprising

CBD and a therapeutic pharmaceutical cancer agents (ChEH/AEBS inhibitors, naphthoquinone or derivatives) for the treatment of cancer.

Therapy (EP 18165731.3 and WO2019/193112 and national patent filings in the U.S.

and other countries/regions):

Relates to regimes

of drug administration and drug combinations that include a cannabinoid for use in the treatment of breast cancer, including triple-negative

breast cancer.

in Combination with Chemotherapy (WO2021/028646):

Relates to regimes of drug administration and cannabinoid administration for

treatment of bladder, brain and spinal cord, colorectal, head and neck, lung, lymphoma, neuroendocrine, oesophageal, ovarian, pancreatic

and prostate cancer.

Supply Agreement

February 22, 2021, we entered into an exclusive supply agreement (the “Development and Clinical Supply Agreement”)

with PureForm Global, Inc.

(“PureForm”), a biotechnology company focused on the research, development and commercialization

of synthesized CBD and other cannabinoids not derived from hemp or cannabis, for use in development and commercialization of products

for cancer supportive/palliative care associated with radiodermatitis, chemotherapy induced peripheral neuropathy, and glioblastoma.

Pursuant to the Development and Clinical Supply Agreement, PureForm will be the exclusive provider of synthetic cannabidiol (“API”)

for Enveric’s development plans for cancer treatment and supportive care.

Under the terms of the Development and Clinical

Supply Agreement, PureForm has granted Enveric the exclusive right to purchase API and related products for cancer treatment

and supporting care.

& Development

view of the urgent need for new and more effective oncology drugs, we intend to combine innovative science and accelerated clinical development

to create and develop novel therapies using cannabinoid-based medications and similar compounds.

Our past research and development efforts

were limited to investigative work surrounding cannabinoids, including creating and developing novel formulations, and evaluating potential

opportunities to license technologies from pharmaceutical companies and leading research institutions.

Our principal research efforts

to date have been with Soroka Medical Center, MSKCC, Tikun Olam and St.

George’s University of London.

are currently assembling a team of principal investigators with of clinical experience across multiple cancer types to be responsible

for the management, monitoring, and integrity of the clinical research.

The following studies are being evaluated for potential advancement:

Radiodermatitis:

A Phase 1/2 evaluating a CBD-infused formulation for skin.

or Progressive Glioblastoma Multiforme:

A Phase 1/2 study of oral CBD extract in combination with Clomiphene or oral CBD extract

alone given concurrently with dose-dense Temolozomide to patients with recurrent or progressive glioblastoma.

plan to submit INDs and, eventually, NDAs to seek FDA approval in connection with the Radiodermatitis and Recurrent or Progressive Glioblastoma

Multiforme product candidates.

The selection, timing, duration, and design of any prospective studies are subject to approval and finalization.

Advisory Board

have established a scientific advisory board and regularly seeks advice and input from these experienced clinical leaders on matters

related to its research and development programs.

The members of our scientific advisory board consist of experts across a range of key

disciplines relevant to its programs.

We intend to continue to leverage the broad expertise of its advisors by seeking their counsel

on important topics relating to its product development and clinical development programs.

scientific advisors are not our employees and have commitments to, or consulting or advisory contracts with, other entities that may

limit their availability to us.

In addition, its scientific advisors may have arrangements with other companies to assist those companies

in developing products or technologies that may compete with us.

All of our scientific advisors are affiliated with other entities and

devote a limited portion of their time to us.

Enveric’s

current scientific advisors are set forth in the table below:

Specialization

Zelefsky, M.D.

Chair, Department of Radiation Oncology, Chief, Brachytherapy Service, Memorial Sloan Kettering Cancer Center

Dagleish, M.D.

George’s University of London

Neuro-Oncologist,

Sunnybrook Research Institute;

Professor, University of Toronto

Neurobiology, Weizmann Institute

Research, Patent Contributor

Zelefsky, M.D.

has served as a Scientific Advisor of Enveric since April 2019.

Zelefsky, is a board-certified radiation

oncologist and co-leader of Memorial Sloan Kettering’s Genitourinary Disease Management Team, a multidisciplinary group

of physicians who work together to treat patients with urologic malignancies.

Zelefsky is Chief of Memorial Sloan Kettering’s

Brachytherapy Service.

The prostate brachytherapy program at Memorial Sloan Kettering, which Dr.

Zelefsky helped develop and enhance

since joining the staff in 1990, is known for its depth of experience and cutting-edge approach in treating men with prostate

Zelefsky was instrumental in pioneering the use of IMRT (intensity-modulated radiation therapy, which is computer-guided

delivery of high doses of radiation directly to the tumor) and IGRT (image-guided radiotherapy, radiation beams targeted precisely

to the tumor) for treating men with prostate cancer.

Zelefsky is Editor-in-Chief of Brachytherapy, a medical journal that

addresses all aspects of this sub-specialty, and Chairman of the National Patterns of Care Study for Genitourinary Cancers.

is also a past president of the American Brachytherapy Society.

For his work in this field, Dr.

Zelefsky has been honored to receive

several awards including the Boyer Award for Excellence in Clinical research, the Outstanding Teaching Award in the Department

of Radiation Oncology at Memorial Sloan Kettering, the 2009 Henschke Medal (the highest award of the American Brachytherapy Society

for achievements in Brachytherapy), and the 2009 Emanuel Van Descheuren Award for Excellence in Translational Research.

Dalgleish, M.D.

has served as a Scientific Advisor of Enveric since January 2019.

Dalgleish, is an oncologist practicing

in the United Kingdom at St.

George’s University of London.

Dalgleish divides his time between clinical practice and

research, and also serves as an advisor to several biopharmaceutical companies.

Dalgleish has been a Professor of Medical

Oncology at St.

George’s University of London and Consultant Physician at St.

George’s Hospital since 1991.

served as the President of the Clinical Immunology and Allergy Section of the Royal Society of Medicine and is a Fellow of The

Royal College of Physicians.

Dalgleish studied Medicine at University College London, where he obtained an MBBS and a BSc

has served as a Scientific Advisor of Enveric since April 2019.

James Perry is a neuro-oncologist at Sunnybrook’s

Odette Cancer Centre and Hurvitz Brain Sciences Program.

Perry is also a Professor of medicine at the University of Toronto

and the central nervous system cancers lead at Cancer Care Ontario.

Perry is a clinician-investigator interested in the design,

conduct and analysis of clinical trials testing innovative therapies for primary brain tumours.

His research unit is focused on

outcomes research.

He is the chair of the Canadian Brain Tumour Consortium (CBTC), a national not-for-profit investigator network.

has served as a Scientific Advisor of Enveric since February 2018.

Professor Vogel is currently a Professor Emeritus

at the Weizmann Institute of science serving as the Head of the Adelson Center for the Biology of Addictive Diseases at Tel-Aviv

Professor Vogel previously served as the Chairman of the Department of Neurobiology at the Weizmann Institute.

has published more than 170 scientific manuscripts.

Professor Vogel earned a M.Sc in Biochemistry and a Ph.D.

from the Weizmann

Institute of Science.

He performed his post-doctorate studies at the National Institutes of Health (Bethesda, MD) in the Laboratory

of Marshall Nirenberg, a Nobel Prize winner.

and Industry Partners

have also established relationships with certain academic and industry partners, whom we believe have the potential to accelerate product

development, market entry, data collection, analysis and advancement of clinical trials.

current academic and industry partners are set forth in the table below:

brings proprietary products and data, clinical research experience, and access to resources in Israel.

George’s University of London

George’s University of London brings research capabilities and relevant domain expertise in cancer and cannabinoids.

Soroka Medical Cancer Center

Soroka Medical Cancer Center brings clinical research capabilities and extensive patient access.

biotechnology and pharmaceutical industries are characterized by rapidly advancing technologies, intense competition, and a strong

emphasis on proprietary products.

While we believe that our scientific knowledge and technology and development experience

provide us with competitive advantages, we face potential competition from many different sources, including major pharmaceutical,

specialty pharmaceutical and biotechnology companies, academic institutions, governmental agencies, and public and private research

institutions.

Any product candidates that we successfully develop and commercialize will compete with existing therapies and

new therapies that may become available in the future.

GBM, we believe that only one drug product (Epidiolex, developed by GW Pharmaceuticals) is a potential late-stage competitor.

Other than Epidiolex, we are aware of exploratory research into the effects of cannabinoid drug formulations.

We are also aware

of discovery research within the pharmaceutical industry into synthetic agonists and antagonists of CB1 and CB2 receptors, as

well as companies that supply synthetic cannabinoids and cannabis extracts to researchers for pre-clinical and clinical investigation,

and various companies that cultivate cannabis plants with a view to supplying herbal cannabis or nonpharmaceutical cannabis-based

formulations to patients.

These therapies have not been approved by the FDA.

In addition, Lutris Pharma has a topical B-Raf

Inhibitor in Phase ½

studies that is intended to treat radiation dermatitis, which is also a potential competitor.

suffering from GBM in the U.S.

are treated with a variety of FDA-approved products, including, but not limited to, Bevacizumab, Carmustine

Implant, Lomustine, and Temozolomide.

Our potential competitors regarding the GBM product candidate include pharmaceutical and biopharmaceutical

companies such as Pfizer, Genentech, Arbor Pharmaceuticals, Next Source Pharmaceuticals, and Merck, among others, depending on when the

candidate is approved for commercialization, if ever (and what, if any, new therapies are approved in the interim).

Such competitors

may have significantly greater financial resources and expertise in research and development, manufacturing, preclinical testing, conducting

clinical trials, obtaining regulatory approvals, and marketing approved medicines than we do.

These competitors also compete with us

in recruiting and retaining qualified scientific and management personnel and establishing clinical trial sites and patient registration

for clinical trials, as well as in acquiring technologies complementary to, or necessary for, our programs.

respect to CBD, a number of nonapproved and non-standardized CBD preparations derived from crude herbal cannabis have been made

available in limited quantities by producers of “medical marijuana”

We do not believe prescription cannabinoids

are the same as distributing or legalizing crude herbal cannabis, or preparations derived from crude herbal cannabis, and therefore

we do not believe they are competitive with, crude herbal cannabis.

We believe that only a cannabinoid medication, one that is

standardized in composition, formulation and dose, administered by means of an appropriate delivery system, and tested in properly

controlled pre-clinical and clinical studies, can meet the standards of regulatory authorities around the world, including those

We also believe that these regulatory processes provide important protections for patients, and that any cannabinoid

medication must be subjected to, and satisfy, such rigorous scrutiny.

commercial opportunities could be reduced or eliminated if its competitors develop and commercialize medicines that are safer, more effective,

have fewer or less severe side effects, are more convenient or are less expensive than any product candidates that we may develop.

competitors also may obtain approval from the FDA or other regulatory agencies for their medicines more rapidly than us, which could

result in our competitors establishing a strong market position before we are able to enter the market.

Regulation and Product Approvals

Pharmaceutical

companies are subject to extensive regulation by the federal government, principally by the FDA under the Federal Food, Drug and Cosmetic

Act, or the FDCA, and, to a lesser extent, by state and local governments.

Before our prescription products may be marketed in the U.S.,

they must be approved by the FDA for commercial distribution.

Certain OTC products must comply with applicable FDA regulations, known

as OTC Monographs, in order to be marketed, but do not have the benefit of FDA review and approval before marketing.

We are also subject

to regulation under federal, state and local laws, including requirements regarding occupational safety, laboratory practices, environmental

protection and hazardous substance control, and may be subject to other present and future local, state, federal and foreign regulations.

We cannot predict the extent to which we may be affected by legislative and other regulatory developments concerning our products and

the healthcare industry in general.

FDCA and other federal and state statutes and regulations govern the testing, manufacture, quality control, export and import, labeling,

storage, record keeping, approval, pricing, advertising, promotion, sale and distribution of pharmaceutical products.

Noncompliance with

applicable requirements both before and after approval, can subject us, our third party manufacturers and other collaborative partners

to administrative and judicial sanctions, such as, among other things, warning letters, fines and other monetary payments, recall or

seizure of products, criminal proceedings, suspension or withdrawal of regulatory approvals, interruption or cessation of clinical trials,

total or partial suspension of production or distribution, injunctions, limitations on or the limitation of claims we can make for our

products, and refusal of the government to enter into supply contracts for distribution directly by governmental agencies, or delay in

approving or refusal to approve new drug applications.

The FDA also has the authority to revoke or withhold approvals of new drug applications.

approval is required before any “new drug,”

can be marketed.

Our products are new drugs and require prior FDA approval.

approval must be based on extensive information and data submitted in a NDA, including, but not limited to, adequate and well controlled

laboratory and clinical investigations to demonstrate the safety and effectiveness of the drug product for its intended use(s) as well

as the manufacturing suitability of the product.

In addition to providing required safety and effectiveness data for FDA approval, a

drug manufacturer’s practices and procedures must comply with current Good Manufacturing Practices (“cGMPs”), which

apply to manufacturing, receiving, holding and shipping, and include, among other things, demonstration of product purity, consistent

manufacturing and quality and at least six months of data supporting product expiration dating based on clinical registration batches.

Accordingly, manufacturers must continue to expend time, money and effort in all applicable areas relating to quality assurance and regulatory

compliance, including production and quality control to comply with cGMPs.

Failure to so comply risks delays in approval of drug products

and possible FDA enforcement actions, such as an injunction against shipment of products, the seizure of non-complying products, criminal

prosecution and/or any of the other possible consequences described above.

We are subject to periodic inspection by the FDA and the Drug

Enforcement Administration (“DEA”), which inspections may or may not be announced in advance.

New Drug Approval Process

the U.S., pharmaceutical products are subject to extensive regulation by the FDA.

The Federal Food, Drug, and Cosmetic Act, or the FDCA,

and other federal and state statutes and regulations, govern, among other things, the research, development, testing, manufacture, storage,

recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import

and export of pharmaceutical products.

Failure to comply with applicable U.S.

requirements may subject a company to a variety of administrative

or judicial sanctions, such as imposition of clinical holds, FDA refusal to approve pending new drug applications (“NDA”),

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

of government contracts, restitution, disgorgement, civil penalties and criminal prosecution.

Pharmaceutical

product development in the U.S.

typically involves pre-clinical laboratory and animal tests and the submission to the FDA of an Investigational

New Drug applications (“IND”), which must become effective before clinical testing may commence.

For commercial approval,

the sponsor must submit adequate tests by all methods reasonably applicable to show that the drug is safe for use under the conditions

prescribed, recommended or suggested in the proposed labeling.

The sponsor must also submit substantial evidence, generally consisting

of adequate, well-controlled clinical trials to establish that the drug will have the effect it purports or is represented to have under

the conditions of use prescribed, recommended or suggested in the proposed labeling.

In certain cases, the FDA may determine that a drug

is effective based on one clinical study plus confirmatory evidence.

Satisfaction of FDA pre-market approval requirements typically takes

many years and the actual time required may vary substantially based upon the type, complexity and novelty of the product or disease.

tests include laboratory evaluation of product chemistry, formulation and toxicity, as well as animal trials to assess the characteristics

and potential safety and efficacy of the product.

The conduct of the pre-clinical tests must comply with federal regulations and requirements,

including the FDA’s good laboratory practices regulations and the U.S.

Department of Agriculture’s (USDA’s) regulations

implementing the Animal Welfare Act.

The results of pre-clinical testing are submitted to the FDA as part of an IND along with other

information, including information about product chemistry, manufacturing and controls, and a proposed clinical trial protocol.

pre-clinical tests, such as animal tests of reproductive toxicity and carcinogenicity, may continue after the IND is submitted.

30-day waiting period after the submission of each IND is required prior to the commencement of clinical testing in humans.

has not imposed a clinical hold on the IND or otherwise commented or questioned the IND within this 30-day period, the clinical trial

proposed in the IND may begin.

trials involve the administration of the investigational new drug to healthy volunteers or patients under the supervision of a qualified

investigator.

Clinical trials must be conducted:

(i) in compliance with federal regulations, (ii) in compliance with GCP, an international

standard meant to protect the rights and health of patients and to define the roles of clinical trial sponsors, administrators and monitors,

and (iii) under protocols detailing the objectives of the trial, the parameters to be used in monitoring safety and the effectiveness

criteria to be evaluated.

Each protocol involving testing on U.S.

patients and subsequent protocol amendments must be submitted to the

FDA as part of the IND.

FDA may order the temporary, or permanent, discontinuation of a clinical trial at any time or impose other sanctions if it believes that

the clinical trial either is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical

trial patients.

The trial protocol and informed consent information for patients in clinical trials must also be submitted to an institutional

review board, or IRB, for approval.

An IRB may also require the clinical trial at the site to be halted, either temporarily or permanently,

for failure to comply with the IRB’s requirements or may impose other conditions.

trials to support NDAs for marketing approval are typically conducted in three sequential phases, but the phases may overlap.

in Phase 1, the initial introduction of the drug into healthy human subjects or patients, the drug is tested to assess metabolism, pharmacokinetics,

pharmacological actions, side effects associated with increasing doses and, if possible, early evidence on effectiveness.

Phase 2 usually

involves trials in a limited patient population to determine the effectiveness of the drug for a particular indication, dosage tolerance

and optimum dosage, and to identify common adverse effects and safety risks.

If a compound demonstrates evidence of effectiveness and

an acceptable safety profile in Phase 2 evaluations, Phase 3 trials are undertaken to obtain the additional information about clinical

efficacy and safety in a larger number of patients, typically at geographically dispersed clinical trial sites, to permit the FDA to

evaluate the overall benefit-risk relationship of the drug and to provide adequate information for the labeling of the drug.

cases, the FDA requires two adequate and well-controlled Phase 3 clinical trials to demonstrate the efficacy of the drug.

however, determine that a drug is effective based on one clinical study plus confirmatory evidence.

Only a small percentage of investigational

drugs complete all three phases and obtain marketing approval.

In some cases, the FDA may require post-market studies, known as Phase

4 studies, to be conducted as a condition of approval in order to gather additional information on the drug’s effect in various

populations and any side effects associated with long-term use.

Depending on the risks posed by the drugs, other post-market requirements

may be imposed.

completion of the required clinical testing, an NDA is prepared and submitted to the FDA.

The FDA approval of the NDA is required before

marketing of the product may begin in the U.S.

The NDA must include the results of all pre-clinical, clinical, and other testing and

a compilation of data relating to the product’s pharmacology, chemistry, manufacture, and controls.

The cost of preparing and submitting

an NDA is substantial.

Under federal law, the submission of most NDAs is additionally subject to a substantial application user fee.

FDA has 60 days from its receipt of an NDA to determine whether the application will be accepted for filing based on the agency’s

threshold determination that it is sufficiently complete to permit substantive review.

Once the submission is accepted for filing, the

FDA begins an in-depth review.

Under the statute and implementing regulations, the FDA has 180 days (the initial review cycle) from the

date of filing to issue either an approval letter or a complete response letter, unless the review period is adjusted by mutual agreement

between the FDA and the applicant or as a result of the applicant submitting a major amendment.

In practice, the performance goals established

pursuant to the Prescription Drug User Fee Act have effectively extended the initial review cycle beyond 180 days.

The FDA’s current

performance goals call for the FDA to complete review of 90 percent of standard (non-priority) NDAs within 10 months of receipt and within

six months for priority NDAs, but two additional months are added to standard and priority NDAs for a new molecular entity (NME).

FDA may also refer applications for novel drug products, or drug products that present difficult questions of safety or efficacy, to

an advisory committee, which is typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation

as to whether the application should be approved.

The FDA is not bound by the recommendation of an advisory committee, but it generally

follows such recommendations.

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

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

The FDA will not approve

the product unless compliance with current GMP is satisfactory and the NDA contains data that provide substantial evidence that the drug

is safe and effective in the indication studied.

the FDA evaluates the NDA and the manufacturing facilities, it issues either an approval letter or a complete response letter.

response letter generally outlines the deficiencies in the submission and may require substantial additional testing, or information,

in order for the FDA to reconsider the application.

If, or when, those deficiencies have been addressed to the FDA’s satisfaction

in a resubmission of the NDA, the FDA will issue an approval letter.

The FDA has committed to reviewing 90 percent of resubmissions within

two to six months depending on the type of information included.

approval letter authorizes commercial marketing of the drug with specific prescribing information for specific indications.

As a condition

of NDA approval, the FDA may require a risk evaluation and mitigation strategy, or REMS, to help ensure that the benefits of the drug

outweigh the potential risks.

REMS can include medication guides, communication plans for health care professionals, and elements to

assure safe use, or ETASU.

ETASU can include, but are not limited to, special training or certification for prescribing or dispensing,

dispensing only under certain circumstances, special monitoring, and the use of patient registries.

The requirement for a REMS can materially

affect the potential market and profitability of the drug.

Moreover, product approval may require substantial post-approval testing and

surveillance to monitor the drug’s safety or efficacy.

Once granted, product approvals may be withdrawn if compliance with regulatory

standards is not maintained or problems are identified following initial marketing.

of Clinical Trial Information

of clinical trials of certain FDA-regulated products, including prescription drugs, are required to register and disclose certain clinical

trial information on a public website maintained by the U.S.

National Institutes of Health.

Information related to the product, patient

population, phase of investigation, study sites and investigator, and other aspects of the clinical trial is made public as part of the

registration.

Sponsors are also obligated to disclose the results of these trials after completion.

Disclosure of the results of these

trials can be delayed for up to two years if the sponsor certifies that it is seeking approval of an unapproved product or that it will

file an application for approval of a new indication for an approved product within one year.

Competitors may use this publicly available

information to gain knowledge regarding the design and progress of our development programs.

Protocol Assessment

company may reach an agreement with the FDA under the Special Protocol Assessment, or “SPA”, process as to the required design

and size of clinical trials intended to form the primary basis of an efficacy claim.

According to its performance goals, the FDA is supposed

to evaluate the protocol within 45 days of the request to assess whether the proposed trial is adequate, and that evaluation may result

in discussions and a request for additional information.

A SPA request must be made before the proposed trial begins, and all open issues

must be resolved before the trial begins.

If a written agreement is reached, it will be documented and made part of the administrative

Under the FDCA and FDA guidance implementing the statutory requirement, an SPA is generally binding upon the FDA except in limited

circumstances, such as if the FDA identifies a substantial scientific issue essential to determining safety or efficacy after the study

begins, public health concerns emerge that were unrecognized at the time of the protocol assessment, the sponsor and the FDA agree to

the change in writing, or if the study sponsor fails to follow the protocol that was agreed upon with the FDA.

and Promotion

promotion of investigational drug candidates is prohibited by the FDA.

Therefore, sponsors must ensure that any pre-approval communications

disseminated about its drug candidates do not state or imply that such candidates have been proven safe or effective for the applicable

use(s) or that they have been approved for commercialization in the United States.

Further, once an NDA for a given candidate is approved,

if ever, the product will be subject to certain post-approval requirements.

For instance, the FDA closely regulates the post-approval

marketing and promotion of drugs.

may be marketed only for the approved indications and in accordance with the provisions of the approved labeling.

Changes to some of

the conditions established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities,

require submission and FDA approval of a new NDA or NDA supplement before the change can be implemented.

An NDA supplement for a new

indication typically requires clinical data similar to that in the original application, and the FDA uses the same procedures and actions

in reviewing NDA supplements as it does in reviewing NDAs.

Event Reporting and GMP Compliance

event reporting and submission of periodic reports is required following FDA approval of an NDA.

The FDA also may require post-marketing

testing, known as Phase 4 testing, may require under a REMS special communication regarding the safety of the drug or heightened surveillance

to monitor the effects of an approved product, or the FDA may place conditions on an approval that could restrict the distribution or

use of the product.

In addition, quality-control, drug manufacture, packaging, and labeling procedures must continue to conform to GMP,

after approval.

Drug manufacturers and certain of their subcontractors are required to register their establishments with the FDA and

certain state agencies.

Registration with the FDA subjects entities to periodic unannounced inspections by the FDA, during which the

agency inspects manufacturing facilities to assess compliance with GMP.

Accordingly, manufacturers must continue to expend time, money

and effort in the areas of production and quality control to maintain compliance with GMP.

Regulatory authorities may withdraw product

approvals or request product recalls if a company fails to comply with regulatory standards, if it encounters problems following initial

marketing or if previously unrecognized problems are subsequently discovered.

Exclusivity and Pediatric Use

Best Pharmaceuticals for Children Act, or “BPCA”, provides NDA holders a six-month period of exclusivity attached to any

other exclusivity listed with the FDA — patent or non-patent — for a drug, if certain conditions

Conditions for pediatric exclusivity include a determination by the FDA that information relating to the use of a new drug in

the pediatric population may produce health benefits in that population;

a written request by the FDA for pediatric studies;

and agreement

by the applicant to perform the requested studies and the submission to the FDA, completion of the studies in accordance with the written

request, and the acceptance by the FDA, of the reports of the requested studies within the statutory time frame.

Applications under the

BPCA are treated as priority applications.

addition, under the Pediatric Research Equity Act, or “PREA”, NDAs or supplements to NDAs must contain data to assess the

safety and effectiveness of the drug for the claimed indications in all relevant pediatric subpopulations and to support dosing and administration

for each pediatric subpopulation for which the drug is safe and effective, unless the sponsor has received a deferral or waiver from

Unless otherwise required by regulation, PREA does not apply to any drug for an indication for which orphan designation has

been granted.

The sponsor or the FDA may request a deferral of pediatric studies for some or all of the pediatric subpopulations.

may be granted for several reasons, including a finding that the drug is ready for approval for use in adults before pediatric studies

are complete or that additional safety or effectiveness data need to be collected before the pediatric studies begin.

Under PREA, the

FDA must send a noncompliance letter requesting a response within 45 days to any sponsor that fails to submit the required assessment,

keep a deferral current or fails to submit a request for approval of a pediatric formulation.

federal Controlled Substances Act of 1970, or “CSA”, and its implementing regulations establish a “closed system”

of regulations for controlled substances.

The CSA imposes registration, security, recordkeeping and reporting, storage, manufacturing,

distribution, importation and other requirements under the oversight of the DEA.

The DEA is the federal agency responsible for regulating

controlled substances, and requires those individuals or entities that manufacture, import, export, distribute, research, or dispense

controlled substances to comply with the regulatory requirements in order to prevent the diversion of controlled substances to illicit

channels of commerce.

DEA categorizes controlled substances into one of five schedules — Schedule I, II, III, IV or V — with

varying qualifications for listing in each schedule.

Schedule I substances by definition have a high potential for abuse, have no currently

accepted medical use in treatment in the U.S., and lack accepted safety for use under medical supervision.

Marijuana is currently a Schedule

I controlled substance, which means that no preclinical or clinical studies of product candidates containing marijuana may be conducted

in the United States without the required DEA registration(s) and related approvals, as applicable.

Pharmaceutical products having a

currently accepted medical use that are otherwise approved for marketing may be listed as Schedule II, III, IV or V substances, with

Schedule II substances presenting the highest potential for abuse and physical or psychological dependence, and Schedule V substances

presenting the lowest relative potential for abuse and dependence.

that manufacture, distribute, import, or export any controlled substance must register annually with the DEA.

The DEA registration is

specific to the particular location, activity(ies) and controlled substance schedule(s).

For example, separate registrations are required

for importation and manufacturing activities, and each registration authorizes which schedules of controlled substances the registrant

However, certain coincidental activities are permitted without obtaining a separate DEA registration, such as distribution

of controlled substances by the manufacturer that produces them.

DEA inspects all manufacturing facilities to review security, recordkeeping, reporting, and handling prior to issuing a controlled substance

registration.

The specific security requirements vary by the type of business activity and the schedule and quantity of controlled substances

The most stringent requirements apply to manufacturers of Schedules I and Schedule II substances.

Required security measures

commonly include background checks on employees and physical control of controlled substances through storage in approved vaults, safes

and cages, and through use of alarm systems and surveillance cameras.

An application for a manufacturing registration as a bulk manufacturer

(not a dosage form manufacturer or a repacker/relabeler) for a Schedule I or II substance must be published in the Federal Register,

and is open for 60 days to permit interested persons to submit comments, objections or requests for a hearing.

A copy of the notice of

the Federal Register publication is simultaneously forwarded by DEA to all those registered, or applicants for registration, as bulk

manufacturers of that substance.

Once registered, manufacturing facilities must maintain records documenting the manufacture, receipt

and distribution of all controlled substances.

Manufacturers must submit periodic reports to the DEA of the distribution of Schedules

I and II controlled substances, Schedule III narcotic substances, and other designated substances.

Registrants must also report any controlled

substance thefts or significant losses, and must obtain authorization to destroy or dispose of controlled substances.

As with applications

for registration as a bulk manufacturer, an application for an importer registration for a Schedule I or II substance must also be published

in the Federal Register, which remains open for 30 days for comments.

Imports of Schedules I and II controlled substances for commercial

purposes are generally restricted to substances not already available from a domestic supplier or where there is not adequate competition

among domestic suppliers.

In addition to an importer or exporter registration, importers and exporters must obtain a permit for every

import or export of a Schedules I and II substance or Schedules III, IV and V narcotic, and submit import or export declarations for

Schedules III, IV and V non-narcotics.

In some cases, Schedule III non-narcotic substances may be subject to the import/export permit

requirement, if necessary to ensure that the U.S.

complies with its obligations under international drug control treaties.

drugs manufactured in the U.S., the DEA establishes annually an aggregate quota for the amount of substances within Schedules I and II

that may be manufactured or produced in the U.S.

based on the DEA’s estimate of the quantity needed to meet legitimate medical,

scientific, research and industrial needs.

This limited aggregate amount of cannabis that the DEA allows to be produced in the U.S.

year is allocated among individual companies, which, in turn, must annually apply to the DEA for individual manufacturing and procurement

The quotas apply equally to the manufacturing of the active pharmaceutical ingredient and production of dosage forms.

may adjust aggregate production quotas a few times per year, and individual manufacturing or procurement quotas from time to time during

the year, although the DEA has substantial discretion in whether or not to make such adjustments for individual companies.

states also maintain separate controlled substance laws and regulations, including licensing, recordkeeping, security, distribution,

and dispensing requirements.

State Authorities, including Boards of Pharmacy, regulate use of controlled substances in each state.

to maintain compliance with applicable requirements, particularly as manifested in the loss or diversion of controlled substances, can

result in enforcement action that could have a material adverse effect on our business, operations and financial condition.

seek civil penalties, refuse to renew necessary registrations, or initiate proceedings to revoke those registrations.

In certain circumstances,

violations could lead to criminal prosecution.

of World Government Regulation

addition to regulations in the U.S., we are and will be subject, either directly or through our distribution partners, to a variety of

regulations in other jurisdictions governing, among other things, clinical trials and any commercial sales (including pricing and reimbursement)

and distribution of our product candidates, if approved.

or not we obtain FDA approval for a product, it must obtain the requisite approvals from regulatory authorities in non-U.S.

prior to the commencement of clinical trials or marketing of the product in those countries.

the European Union, medicinal products are subject to extensive pre- and post-marketing regulation by regulatory authorities at both

the European Union and national levels.

Additional rules also apply at the national level to the manufacture, import, export, storage,

distribution and sale of controlled substances.

In many European Union member states the regulatory authority responsible for medicinal

products is also responsible for controlled substances.

Responsibility is, however, split in some member states, such as the U.K.

any company manufacturing or distributing a medicinal product containing a controlled substance in the European Union will need to hold

a controlled substances license from the competent national authority and will be subject to specific record-keeping and security obligations.

Separate import or export certificates are required for each shipment into or out of the member state.

Trials and Marketing Approval

countries outside of the U.S.

have a process that requires the submission of a clinical trial application much like an IND prior to the

commencement of human clinical trials.

In Europe, for example, a clinical trial application, or “CTA”, must be submitted

to the competent national health authority and to independent ethics committees in each country in which a company intends to conduct

clinical trials.

Once the CTA is approved in accordance with a country’s requirements and a company has received favorable ethics

committee approval, clinical trial development may proceed in that country.

requirements and process governing the conduct of clinical trials, product licensing, pricing, and reimbursement vary from country to

country, even though there is already some degree of legal harmonization in the European Union member states resulting from the national

implementation of underlying European Union legislation.

In all cases, the clinical trials must be conducted in accordance with the International

Conference on Harmonization, or “ICH”, guidelines on GCP and other applicable regulatory requirements.

obtain regulatory approval to place a drug on the market in European Union countries, Enveric must submit a marketing authorization application.

This application is similar to the NDA in the U.S., with the exception of, among other things, country-specific document requirements.

All application procedures require an application in the common technical document, or CTD, format, which includes the submission of

detailed information about the manufacturing and quality of the product, and nonclinical and clinical trial information.

authorized in the European Union by using (i) the centralized authorization procedure, (ii) the mutual recognition procedure, (iii) the

decentralized procedure, or (iv) national authorization procedures.

European Commission created the centralized procedure for the approval of human drugs to facilitate marketing authorizations that are

valid throughout the European Union and, by extension (after national implementing decisions) in Iceland, Liechtenstein and Norway, which,

together with the European Union.

member states, comprise the European Economic Area, or “EEA”.

Applicants file marketing

authorization applications with the EMA, where they are reviewed by a relevant scientific committee, in most cases the Committee for

Medicinal Products for Human Use (the “CHMP”).

The EMA forwards CHMP opinions to the European Commission, which uses them

as the basis for deciding whether to grant a marketing authorization.

This procedure results in a single marketing authorization granted

by the European Commission that is valid across the European Union, as well as in Iceland, Liechtenstein and Norway.

The centralized

procedure is compulsory for human drugs that are:

(i) derived from biotechnology processes, such as genetic engineering, (ii) contain

a new active substance indicated for the treatment of certain diseases, such as HIV/AIDS, cancer, diabetes, neurodegenerative diseases,

autoimmune and other immune dysfunctions and viral diseases, (iii) officially designated “orphan drugs”

(drugs used for rare

human diseases), and (iv) advanced-therapy medicines, such as gene-therapy, somatic cell-therapy or tissue-engineered medicines.

centralized procedure may at the voluntary request of the applicant also be used for human drugs that do not fall within the above-mentioned

categories if the CHMP agrees that the human drug (a) contains a new active substance not yet approved on November 20, 2005;

(b) constitutes

a significant therapeutic, scientific or technical innovation, or (c) authorization under the centralized procedure is in the interests

of patients at the European Union level.

the centralized procedure in the European Union, the maximum time frame for the evaluation of a marketing authorization application by

the EMA is 210 days (excluding clock stops, when additional written or oral information is to be provided by the applicant in response

to questions asked by the CHMP), with adoption of the actual marketing authorization by the European Commission thereafter.

evaluation might be granted by the CHMP in exceptional cases, when a medicinal product is expected to be of a major public health interest

from the point of view of therapeutic innovation, defined by three cumulative criteria:

the seriousness of the disease to be treated;

the absence of an appropriate alternative therapeutic approach, and anticipation of exceptional high therapeutic benefit.

In this circumstance,

EMA ensures that the evaluation for the opinion of the CHMP is completed within 150 days and the opinion issued thereafter.

those medicinal products for which the centralized procedure is not available, the applicant must submit marketing authorization applications

to the national medicines regulators through one of three procedures:

(i) the mutual recognition procedure (which must be used if the

product has already been authorized in at least one other European Union member state, and in which the European Union member states

are required to grant an authorization recognizing the existing authorization in the other European Union member state, unless they identify

a serious risk to public health), (ii) the decentralized procedure (in which applications are submitted simultaneously in two or more

European Union member states), or (iii) national authorization procedures (which results in a marketing authorization in a single European

Union member state).

Recognition Procedure

mutual recognition procedure, or “MRP”, for the approval of human drugs is an alternative approach to facilitate individual

national marketing authorizations within the European Union.

Basically, the MRP may be applied for all human drugs for which the centralized

procedure is not obligatory.

The MRP is applicable to the majority of conventional medicinal products, and must be used if the product

has already been authorized in one or more member states.

characteristic of the MRP is that the procedure builds on an already-existing marketing authorization in a member state of the European

Union that is used as a reference in order to obtain marketing authorizations in other European Union member states.

In the MRP, a marketing

authorization for a drug already exists in one or more member states of the European Union and subsequently marketing authorization applications

are made in other European Union member states by referring to the initial marketing authorization.

The member state in which the marketing

authorization was first granted will then act as the reference member state.

The member states where the marketing authorization is subsequently

applied for act as concerned member states.

The concerned member states are required to grant an authorization recognizing the existing

authorization in the reference member state, unless they identify a serious risk to public health.

MRP is based on the principle of the mutual recognition by European Union member states of their respective national marketing authorizations.

Based on a marketing authorization in the reference member state, the applicant may apply for marketing authorizations in other member

In such case, the reference member state shall update its existing assessment report about the drug in 90 days.

After the assessment

is completed, copies of the report are sent to all member states, together with the approved summary of product characteristics, labeling

and package leaflet.

The concerned member states then have 90 days to recognize the decision of the reference member state and the summary

of product characteristics, labeling and package leaflet.

National marketing authorizations shall be granted within 30 days after acknowledgement

of the agreement.

any Member State refuse to recognize the marketing authorization by the reference member state, on the grounds of potential serious risk

to public health, the issue will be referred to a coordination group.

Within a time frame of 60 days, member states shall, within the

coordination group, make all efforts to reach a consensus.

If this fails, the procedure is submitted to an EMA scientific committee for

The opinion of this EMA Committee is then forwarded to the European Commission, for the start of the decision-making process.

As in the centralized procedure, this process entails consulting various European Commission Directorates General and the Standing Committee

on Human Medicinal Products.

the European Union, marketing authorization applications for generic medicinal products do not need to include the results of pre-clinical

and clinical trials, but instead can refer to the data included in the marketing authorization of a reference product for which regulatory

data exclusivity has expired.

If a marketing authorization is granted for a medicinal product containing a new active substance, that

product benefits from eight years of data exclusivity, during which generic marketing authorization applications referring to the data

of that product may not be accepted by the regulatory authorities, and a further two years of market exclusivity, during which such generic

products may not be placed on the market.

The two-year period may be extended to three years if during the first eight years a new therapeutic

indication with significant clinical benefit over existing therapies is approved.

Medicinal Products

EMA’s Committee for Orphan Medicinal Products (“COMP”) may recommend orphan medicinal product designation to promote

the development of products that are intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating

conditions affecting not more than 5 in 10,000 persons in the European Union.

Additionally, designation is granted for products intended

for the diagnosis, prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition and when, without

incentives, it is unlikely that sales of the product in the European Union would be sufficient to justify the necessary investment in

developing the medicinal product.

The COMP may only recommend orphan medicinal product designation when the product in question offers

a significant clinical benefit over existing approved products for the relevant indication.

Following a positive opinion by the COMP,

the European Commission adopts a decision granting orphan status.

The COMP will reassess orphan status in parallel with EMA review of

a marketing authorization application and orphan status may be withdrawn at that stage if it no longer fulfills the orphan criteria (for

instance because in the meantime a new product was approved for the indication and no convincing data are available to demonstrate a

significant benefit over that product).

Orphan medicinal product designation entitles a party to financial incentives such as reduction

of fees or fee waivers and ten years of market exclusivity is granted following marketing authorization.

During this period, the competent

authorities may not accept or approve any similar medicinal product, unless it offers a significant clinical benefit.

This period may

be reduced to six years if the orphan medicinal product designation criteria are no longer met, including where it is shown that the

product is sufficiently profitable not to justify maintenance of market exclusivity.

the European Union, companies developing a new medicinal product must agree to a Pediatric Investigation Plan, or “PIP”,

with the EMA and must conduct pediatric clinical trials in accordance with that PIP unless a waiver applies, for example, because the

relevant disease or condition occurs only in adults.

The marketing authorization application for the product must include the results

of pediatric clinical trials conducted in accordance with the PIP, unless a waiver applies, or a deferral has been granted, in which

case the pediatric clinical trials must be completed at a later date.

Products that are granted a marketing authorization on the basis

of the pediatric clinical trials conducted in accordance with the PIP are eligible for a six-month extension of the protection under

a supplementary protection certificate (if the product covered by it qualifies for one at the time of approval).

This pediatric reward

is subject to specific conditions and is not automatically available when data in compliance with the PIP are developed and submitted.

we fail to comply with applicable foreign regulatory requirements, it may be subject to, among other things, fines, suspension of clinical

trials, suspension or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

addition, most countries are parties to the Single Convention on Narcotic Drugs 1961, which governs international trade and domestic

control of narcotic substances, including cannabis extracts.

Countries may interpret and implement their treaty obligations in a way

that creates a legal obstacle to us obtaining marketing approval for our product candidates in those countries.

These countries may not

be willing or able to amend or otherwise modify their laws and regulations to permit our product candidates to be marketed, or achieving

such amendments to the laws and regulations may take a prolonged period of time.

In that case, we would be unable to market our product

candidates in those countries in the near future or perhaps at all.

continue to build on our leadership expertise.

We employ two full-time and one part-time employee.

We also work with scientific

advisors, consultants and service providers, mainly through academic institutions and contract research organizations.

have never had a work stoppage and none of its employees are covered by collective bargaining agreements or represented by a labor union.

We believe that we have good relationships with our employees.

time to time, we may be a party to litigation that arises in the ordinary course of its business.

Other than as described below,

we do not have any pending litigation that, separately or in the aggregate, would, in the opinion of management, have a material

adverse effect on its results of operations, financial condition or cash flows.

January 21, 2021, we received a stockholder litigation demand letter from the law firm of Purcell Julie & Lefkowitz LLP,

on behalf of James Self, a purported stockholder of our Company.

The letter demands that we (i) deem ineffective the December

30, 2020 amendment to its Amended and Restated Certificate of Incorporation in which we effected a reverse stock split due to

the manner in which non-votes by brokers were tabulated, (ii) seek appropriate relief for damages allegedly suffered by the

company and its stockholders or seek a valid stockholder approval of the amendment and reverse stock split, and (iii) adopt

adequate internal controls to prevent a recurrence of the alleged misconduct.

We dispute that the amendment was ineffective

or that there were any inadequate internal controls related to the same.

However, to eliminate any questions about the

amendment, we intend to seek to ratify the amendment at a special stockholders’

meeting pursuant to Section 204 of the

Delaware General Corporation Law.

This special stockholders’

meeting is scheduled to occur on May 14, 2021.

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