What changed in this filing

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Item 9A. Controls and Procedures

2025-03-28 compared with 2024-03-26 · 872 added, 941 removed, 992 unchanged (65% of the section changed)

51 unchanged sentences

were unable to document, formalize, implement and revise where necessary controls, policies and procedure documentation to evidence

a system of controls, including testing of such controls that is consistent with our current personnel and available resources;

a system of controls, inclusive of IT controls, including testing of such controls that is consistent with our current personnel

and available resources;

failed to document, maintain and test effective control activities over our control environment, risk assessment, information technology

13 unchanged sentences

efforts to address material weaknesses in internal controls

engaged third party subject matter experts to assist in the design and documentation of an internal control environment meeting those

requirements and criteria established in the COSO 2013 Internal Control Integrated Framework;

engaged information technology experts who designed and implemented a secure, cloud based, server and IT environment with controlled

8 unchanged sentences

segregation of duties.

we engaged third party subject matter experts to assist in the design and documentation of an internal control environment meeting

those requirements and criteria established in the COSO 2013 Internal Control Integrated Framework, but as of December 31, 2024 we

did not have any third party subject matter experts engaged.

Other Information

May 2023, pursuant to the Akos Series A Preferred Certificate of Designations, the holders of the Akos Series A Preferred Stock exercised

the Put Right requiring Akos to force redemption of all of the Akos Series A Preferred Stock for $1,000 per share, plus accrued

but unpaid dividends of approximately $50,000 for a total of approximately $1,052,057.

The Company had 20 days following the receipt

of the Put Exercise Notice to make the payment and made payment on May 19, 2023.

Company, Akos, and the Akos Investor terminated the Akos Purchase Agreement in connection with the planned Spin-Off and that certain

registration rights agreement in connection with the Akos Private Placement in May 2023.

May 2023, the Company entered into a cost reduction plan, including a reduction in force of approximately 35% of its full-time employees

to streamline its operations and conserve cash resources.

Additionally, contracts with seven consultants that were focused on the Akos

cannabinoid spin-out will be terminated.

The Company recognized severance charges of $874,273 through December 31, 2023.

The plan included

a focus on progressing the Company’s existing non-cannabinoid pipeline while reducing the rate of spend and managing cash flow.

As of December 31, 2023, the Company has completed the reduction in force, with such severance expenses recorded in salaries and wages.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

Directors, Executive Officers and Corporate Governance

We incorporate by reference the information responsive to this Item under

the captions “Election of Directors,” “Corporate Governance – Executive Officers,” “Corporate Governance

– Family Relationships,” “Related Person Transactions and Section 16(a) Beneficial Ownership Reporting Compliance,”

“Corporate Code of Conduct and Ethics,” “Corporate Governance – Committees of the Board of Directors –

Audit Committee,” “Corporate Governance – Insider Trading Policy,” “Stockholder Proposals and Nominations

for Director” appearing in our definitive Proxy Statement on Schedule 14A for our 2024 Annual Meeting of Stockholders (“Proxy

Statement”), a copy of which will be filed no later than 120 days after December 31, 2023.

incorporate by reference the information responsive to this Item appearing in our definitive Proxy Statement on Schedule 14A for our

2025 Annual Meeting of Stockholders (“Proxy Statement”), which will be filed no later than 120 days after December 31, 2024.

Executive Compensation

We incorporate by reference the information responsive to this Item under

the captions “Executive Officer and Director Compensation” and “Corporate Governance – Committees of the Board

of Directors – Compensation Committee” appearing in our Proxy Statement.

incorporate by reference the information responsive to this Item appearing in our Proxy Statement, which will be filed no later than

120 days after December 31, 2024.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

We incorporate by reference the information responsive to this Item under

the captions “Security Ownership of Certain Beneficial Owners and Management” and “Executive Officer and Director Compensation

– Equity Compensation Plan Information” appearing in our Proxy Statement

incorporate by reference the information responsive to this Item appearing in our Proxy Statement, which will be filed no later than

120 days after December 31, 2024.

Certain Relationships and Related Transactions and Director Independence

incorporate by reference the information responsive to this Item under the captions “Related Person Transactions and Section 16(a)

Beneficial Ownership Reporting Compliance” and “Corporate Governance – Director Independence” appearing in our

Proxy Statement.

incorporate by reference the information responsive to this Item appearing in our Proxy Statement, which will be filed no later than

120 days after December 31, 2024.

Principal Accountant Fees and Services

We incorporate by reference the information responsive to this Item under

the caption “Principal Accountant Fees and Services” appearing in our Proxy Statement.

incorporate by reference the information responsive to this Item appearing in our Proxy Statement, which will be filed no later than

120 days after December 31, 2024.

Exhibits and Financial Statement Schedules

1 unchanged sentence

Financial Statements:

Reports of Independent Registered Accounting Firm (PCAOB Firm ID:

Report of Independent Registered Accounting Firm (PCAOB Firm ID:

Marcum LLP # 688 )

9 unchanged sentences

Form 10–K Summary

Share Purchase Agreement, dated January 10, 2020, by and between AMERI Holdings, Inc.

Purchase Agreement, dated January 10, 2020, by and between AMERI Holdings, Inc.

and Ameri100, Inc.

(incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 13, 2020)

Tender Offer Support Agreement and Termination of Amalgamation Agreement, dated August 12, 2020, by and among AMERI Holdings, Inc., Jay Pharma Merger Sub, Inc., Jay Pharma Inc., 1236567 B.C.

Unlimited Liability Company and Barry Kostiner, as the Ameri representative (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on August 12, 2020)

Amendment No.

1 To Tender Offer Support Agreement and Termination of Amalgamation Agreement, dated December 18, 2020, by and among Ameri, Jay Pharma Merger Sub, Inc., Jay Pharma Inc., 1236567 B.C.

Amalgamation Agreement, dated May 24, 2021, by and among Enveric Biosciences, Inc., 1306432 B.C.

(incorporated by reference to

Exhibit 2.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 13, 2020)

Offer Support Agreement and Termination of Amalgamation Agreement, dated August 12, 2020, by and among AMERI Holdings, Inc., Jay

Pharma Merger Sub, Inc., Jay Pharma Inc., 1236567 B.C.

Unlimited Liability Company and Barry Kostiner, as the Ameri representative

(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on August

1 To Tender Offer Support Agreement and Termination of Amalgamation Agreement, dated December 18, 2020, by and among Ameri, Jay

Pharma Merger Sub, Inc., Jay Pharma Inc., 1236567 B.C.

Unlimited Liability Company and Barry Kostiner, as the Ameri representative

(incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on December

Agreement, dated May 24, 2021, by and among Enveric Biosciences, Inc., 1306432 B.C.

LTD., 1306436 B.C.

LTD., and MagicMed Industries, Inc.

LTD., and MagicMed Industries,

(incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K, filed with the Commission on May

Certificate of Amendment to Amended and Restated Certificate of Incorporation of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.2 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

Certificate of Designations of Series B Preferred Stock of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.3 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

Amended and Restated Bylaws of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.4 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

Amendment to the Amended and Restated Bylaws of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on November 18, 2021)

Certificate of Designation of the Series C Preferred Stock of the Company, dated May 4, 2022 (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form 8-A, filed with the Securities and Exchange Commission on May 4, 2022, File No.

Certificate of Amendment of Certificate of Designation of the Series C Preferred Stock of the Company, dated May 17, 2022 (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement on Form 8-A/A, filed with the Securities and Exchange Commission on May 17, 2022, File No.

Certificate of Amendment of Amended and Restated Certificate of Incorporation of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on July 14, 2022)

Description of Securities (incorporated by reference to Exhibit 4.1 of the Company’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 31, 2023)

Form of Pre-Funded Warrant (issued in connection with January 2021 Registered Direct Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

Form of Warrant (issued in connection with January 2021 Registered Direct Offering) (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

Form of Warrant (issued in connection with February 2021 Registered Direct Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 11, 2021)

Form of Series B Warrant (incorporated by reference to Exhibit 4.5 to the Company’s Annual Report on Form 10-K filed with the Commission on April 1, 2021)

Form of MagicMed Warrant Certificate (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 17, 2021)

Form of Common Stock Purchase Warrant (in connection with February 2022 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 15, 2022)

Form of RD Pre-Funded Warrant (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of PIPE Pre-Funded Warrant (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of RD Preferred Investment Option (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.3 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of PIPE Preferred Investment Option (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.4 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of Wainwright Warrant (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.5 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of Inducement Warrant (in connection with December 2023 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Commission on December 29, 2023)

Employment Agreement between Kevin Coveney and the Company, effective March 13, 2023 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 28, 2023)

Form of Securities Purchase Agreement (entered into in connection with the May 5, 2022 Private Placement) (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

Certificate of the Designations, Preferences and Rights of Akos Series A Convertible Preferred Stock (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

Form of Registration Rights Agreement (entered into in connection with the May 5, 2022 Private Placement) (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

Form of Warrant (entered into in connection with the May 5, 2022 Private Placement) (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

Form of Warrant Amendment (in connection with the July 2022 Offerings) (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

First Amendment to the Enveric Biosciences, Inc.

2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on July 14, 2022)

Form of Warrant Amendment (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.4 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of Securities Purchase Agreement (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of Securities Purchase Agreement (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Form of Registration Rights Agreement (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Employment Agreement, dated December 2, 2020, by and between the Company and Avani Kanubaddi (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

Enveric Biosciences, Inc.

2020 Long-Term Equity Incentive Plan (incorporated by reference to Exhibit 10.5 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

Form of RSU Award Agreement (incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

Form of Securities Purchase Agreement, dated January 11, 2021, by and among the Company and the purchasers thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

Form of Registration Rights Agreement, dated January 11, 2021, by and among the Company and the purchasers thereto (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

Letter Agreement, dated January 11, 2021, by and between the Company and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

Form of Securities Purchase Agreement, dated February 9, 2021, by and among the Company and the purchasers thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 11, 2021)

Form of Registration Rights Agreement, dated February 9, 2021, by and among the Company and the purchasers thereto (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on February 11, 2021)

Exclusive License Agreement, between the Company and Diverse Biotech, Inc., dated March 5, 2021 (incorporated by reference to Exhibit 10.6 the Company’s Quarterly Report on Form 10-Q, filed with the Commission on May 17, 2021)

and Restated Certificate of Incorporation of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on January 6, 2021)

of Amendment to Amended and Restated Certificate of Incorporation of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit

3.2 to the Company’s Current Report on Form 8-K, filed with the Commission on January 6, 2021)

of Amendment of Amended and Restated Certificate of Incorporation of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit

3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on July 14, 2022)

of Amendment of Amended and Restated Certificate of Incorporation of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit

3.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 21, 2025)

and Restated Bylaws of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.4 to the Company’s Current Report

on Form 8-K, filed with the Commission on January 6, 2021)

to the Amended and Restated Bylaws of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on November 18, 2021)

of Designations of Series B Preferred Stock of Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 3.3 to the Company’s

Current Report on Form 8-K, filed with the Commission on January 6, 2021)

of Designation of the Series C Preferred Stock of the Company, dated May 4, 2022 (incorporated by reference to Exhibit 3.1 to the

Company’s Registration Statement on Form 8-A, filed with the Securities and Exchange Commission on May 4, 2022, File No.

of Amendment of Certificate of Designation of the Series C Preferred Stock of the Company, dated May 17, 2022 (incorporated by reference

to Exhibit 3.2 to the Company’s Registration Statement on Form 8-A/A, filed with the Securities and Exchange Commission on

May 17, 2022, File No.

of Securities (incorporated by reference to Exhibit 4.1 of the Company’s Annual Report on Form 10-K, filed with the Securities

and Exchange Commission on March 31, 2023)

of Pre-Funded Warrant (issued in connection with January 2021 Registered Direct Offering) (incorporated by reference to Exhibit 4.1

to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

of Warrant (issued in connection with January 2021 Registered Direct Offering) (incorporated by reference to Exhibit 4.2 to the Company’s

Current Report on Form 8-K, filed with the Commission on January 12, 2021)

of Warrant (issued in connection with February 2021 Registered Direct Offering) (incorporated by reference to Exhibit 4.1 to the

Company’s Current Report on Form 8-K, filed with the Commission on February 11, 2021)

of Series B Warrant (incorporated by reference to Exhibit 4.5 to the Company’s Annual Report on Form 10-K filed with the Commission

on April 1, 2021)

of MagicMed Warrant Certificate (incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K filed

with the Securities and Exchange Commission on September 17, 2021)

of Common Stock Purchase Warrant (in connection with February 2022 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on February 15, 2022)

of RD Pre-Funded Warrant (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

of PIPE Pre-Funded Warrant (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.2 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

of RD Preferred Investment Option (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.3 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

of PIPE Preferred Investment Option (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.4 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

of Wainwright Warrant (in connection with July 2022 Offering) (incorporated by reference to Exhibit 4.5 to the Company’s Current

Report on Form 8-K, filed with the Commission on July 26, 2022)

of Inducement Warrant (in connection with December 2023 Offering) (incorporated by reference to Exhibit 4.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on December 29, 2023)

of Pre-Funded Warrant (in connection with January 2025 Offering) (incorporated by reference to Exhibit 4.14 to the Company’s

Registration Statement on Form S-1/A, filed with the Commission on January 30, 2025)

of Series A Warrant (in connection with January 2025 Offering) (incorporated by reference to Exhibit 4.15 to the Company’s

Registration Statement on Form S-1/A, filed with the Commission on January 30, 2025)

of Series B Warrant (in connection with January 2025 Offering) (incorporated by reference to Exhibit 4.16 to the Company’s

Registration Statement on Form S-1/A, filed with the Commission on January 30, 2025)

of Placement Agent Warrant (in connection with January 2025 Offering) (incorporated by reference to Exhibit 4.17 to the Company’s

Registration Statement on Form S-1/A, filed with the Commission on January 30, 2025)

Agreement between Kevin Coveney and the Company, effective March 13, 2023 (incorporated by reference to Exhibit 10.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on February 28, 2023)

of Securities Purchase Agreement (entered into in connection with the May 5, 2022 Private Placement) (incorporated by reference to

Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

of the Designations, Preferences and Rights of Akos Series A Convertible Preferred Stock (incorporated by reference to Exhibit 10.2

to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

of Registration Rights Agreement (entered into in connection with the May 5, 2022 Private Placement) (incorporated by reference to

Exhibit 10.3 to the Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

of Warrant (entered into in connection with the May 5, 2022 Private Placement) (incorporated by reference to Exhibit 10.4 to the

Company’s Current Report on Form 8-K, filed with the Commission on May 11, 2022)

of Warrant Amendment (in connection with the July 2022 Offerings) (incorporated by reference to Exhibit 10.4 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Amendment to the Enveric Biosciences, Inc.

2020 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 14, 2022)

of Warrant Amendment (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.4 to the Company’s Current

Report on Form 8-K, filed with the Commission on July 26, 2022)

of Securities Purchase Agreement (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.1 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

of Securities Purchase Agreement (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.2 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

of Registration Rights Agreement (in connection with July 2022 Offering) (incorporated by reference to Exhibit 10.3 to the Company’s

Current Report on Form 8-K, filed with the Commission on July 26, 2022)

Biosciences, Inc.

2020 Long-Term Equity Incentive Plan (incorporated by reference to Exhibit 10.5 to the Company’s Current

Report on Form 8-K, filed with the Commission on January 6, 2021)

of RSU Award Agreement (incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K, filed with the

Commission on January 6, 2021)

Form of RSA Award Agreement*

of Securities Purchase Agreement, dated January 11, 2021, by and among the Company and the purchasers thereto (incorporated by reference

to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

of Registration Rights Agreement, dated January 11, 2021, by and among the Company and the purchasers thereto (incorporated by reference

to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

Agreement, dated January 11, 2021, by and between the Company and Alpha Capital Anstalt (incorporated by reference to Exhibit 10.3

to the Company’s Current Report on Form 8-K, filed with the Commission on January 12, 2021)

of Securities Purchase Agreement, dated February 9, 2021, by and among the Company and the purchasers thereto (incorporated by reference

to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on February 11, 2021)

of Registration Rights Agreement, dated February 9, 2021, by and among the Company and the purchasers thereto (incorporated by reference

to Exhibit 10.2 to the Company’s Current Report on Form 8-K, filed with the Commission on February 11, 2021)

License Agreement, between the Company and Diverse Biotech, Inc., dated March 5, 2021 (incorporated by reference to Exhibit 10.6

the Company’s Quarterly Report on Form 10-Q, filed with the Commission on May 17, 2021)

Form of Voting and Support Agreement, dated as of May 24, 2021, by and among Enveric Biosciences, Inc.

14 unchanged sentences

(incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 24, 2021)

Employment Agreement between Jillian Hagel and Enveric Biosciences, Inc.

(incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 24, 2021)

MagicMed Stock Option Plan, as amended September 10, 2021 (incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 17, 2021)

Form of Termination of Prior Agreements and Mutual Release (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on May 15, 2023)

Equity Distribution Agreement, dated September 1, 20123, by and among the Company and Canaccord Genuity, LLC (incorporated by reference to Exhibit 1.1 to the Company’s Current Report on Form 8-K, filed with the Commission on September 1, 2023)

Purchase Agreement, dated November 3, 2023, by and among the Company and Lincoln Park Capital Fund, LLC (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed with the Commission on November 6, 2023)

Registration Rights Agreement, dated November 3, 2023, by and among the Company and Lincoln Park Capital Fund, LLC (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K, filed with the Commission on November 6, 2023)

Form of Inducement Warrant, dated December 28, 2023, by and among the investors thereto (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed with the Commission on December 29, 2023)

Code of Ethics*

Policy on Insider Trading*

Subsidiaries (incorporated by reference to Exhibit 21.1 of the Company’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission on March 31, 2023)

Distribution Agreement, dated September 1, 20123, by and among the Company and Canaccord Genuity, LLC (incorporated by reference

to Exhibit 1.1 to the Company’s Current Report on Form 8-K, filed with the Commission on September 1, 2023)

Agreement, dated November 3, 2023, by and among the Company and Lincoln Park Capital Fund, LLC (incorporated by reference to Exhibit

10.1 to the Current Report on Form 8-K, filed with the Commission on November 6, 2023)

Rights Agreement, dated November 3, 2023, by and among the Company and Lincoln Park Capital Fund, LLC (incorporated by reference

to Exhibit 10.2 to the Current Report on Form 8-K, filed with the Commission on November 6, 2023)

of Inducement Warrant, dated December 28, 2023, by and among the investors thereto (incorporated by reference to Exhibit 10.1 to

the Company’s Current Report on Form 8-K, filed with the Commission on December 29, 2023)

of Common Stock Purchase Agreement, dated March 8, 2024, between Enveric Biosciences, Inc.

and the investors set forth therein (incorporated

by reference to Exhibit 10.1 to the Current Report on Form 8-K filed with the Securities and Exchange Commission on March 11, 2024)

of Common Stock Purchase Agreement, dated May 3, 2024, between Enveric Biosciences, Inc.

and the investors set forth therein (incorporated

by reference to Exhibit 10.1 to the Current Report on Form 8-K, filed with the Commission on May 3, 2024)

of Securities Purchase Agreement (incorporated by reference to Exhibit 10.33 to the Company’s Registration Statement on Form

S-1/A, filed with the Commission on January 30, 2025)

Exclusive License Agreement, dated July 10, 2024, between Akos Biosciences, Inc.

and Aries Science and Technology, LLC (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q, filed with the Commission on November 14, 2024)

Exclusive License Agreement, dated November 7, 2024, between Enveric Biosciences, Inc.

and MycoMedica Life Sciences, PBC*

of Ethics (incorporated by reference to Exhibit 14 to the Company’s Annual Report on Form 10-K, filed with the Commission on

March 26, 2024)

on Insider Trading (incorporated by reference to Exhibit 19 to the Company’s Annual Report on Form 10-K, filed with the Commission

on March 26, 2024)

Subsidiaries*

Consent of independent registered public accountant – Marcum LLP*

Certification pursuant to Section 302 of the Sarbanes–Oxley Act of 2002 of Principal Executive Officer*

Certification pursuant to Section 302 of the Sarbanes–Oxley Act of 2002 of Principal Financial and Accounting Officer*

Certification pursuant to Section 906 of the Sarbanes–Oxley Act of 2002 of Principal Executive Officer, Principal Financial and Accounting Officer**

Clawback Policy*

Certification

pursuant to Section 302 of the Sarbanes–Oxley Act of 2002 of Principal Executive Officer*

Certification

pursuant to Section 302 of the Sarbanes–Oxley Act of 2002 of Principal Financial and Accounting Officer*

Certification

pursuant to Section 906 of the Sarbanes–Oxley Act of 2002 of Principal Executive Officer, Principal Financial and Accounting

Policy (incorporated by reference to Exhibit 97 to the Company’s Annual Report on Form 10-K, filed with the Commission on March

XBRL Instance Document*

5 unchanged sentences

Page Interactive Data File (embedded within the Inline XBRL document)

Certain confidential portions of this Exhibit were omitted by means of marking such portions with brackets (“[***]”) because the identified confidential portions (i) are not material and (ii) would be competitively harmful if publicly disclosed.

confidential portions of this Exhibit were omitted by means of marking such portions

brackets (“[***]”) because the identified confidential portions (i) are not material

and (ii) would be competitively harmful if publicly disclosed.

contract or compensatory plan or arrangement.

3 unchanged sentences

Joseph Tucker

Tucker, Ph.D.

Executive Officer

3 unchanged sentences

Joseph Tucker

Tucker, Ph.D.

Executive Officer

5 unchanged sentences

Marcus Schabacker

Schabacker, Ph.D., M.D.

Frank Pasqualone

Sheila DeWitt

DeWitt, Ph.D.

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

8 unchanged sentences

In our opinion, the financial statements present fairly, in all material respects, the financial position of the

Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the two years in the period ended

December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years ended December 31, 2024

and 2023, in conformity with accounting principles generally accepted in the United States of America.

Paragraph – Going Concern

1 unchanged sentence

As more fully described

in Note 1, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations.

conditions raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans in regard

to these matters are also described in Note 1.

The financial statements do not include any adjustments that might result from the outcome

of this uncertainty.

in Note 1, the Company has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

Management’s plans in

regard to these matters are also described in Note 1.

The financial statements do not include any adjustments that might result from

the outcome of this uncertainty.

financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s

financial statements based on our audit s .

We are a public accounting firm registered with the Public Company Accounting Oversight

Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board

(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities

laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

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Audit Matters

critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated

or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial

statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of a critical audit matter

does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit

matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Research & Development Cost Recognition:

Critical Audit Matter Description

As discussed in Note 2 to the financial statements, the Company records costs for contracted research and development costs based upon estimates of costs incurred through the balance sheet date for services performed by contract research organizations, clinical study sites and other research and development related vendors.

Auditing the recognition of costs associated with contracted research and development organizations is challenging due to the significant judgment required to determine the nature and level of services that have been received, including determining the progress to completion of specific tasks and activities conducted in relation to what has been invoiced and recorded.

How We Addressed the Matter in Our Audit

The primary procedures we performed to address this critical audit matter included:

Obtained an understanding of the design and implementation of internal controls for contracted research and development cost.

Tested the completeness and accuracy of the underlying data used in the estimates including, but not limited to, the estimated costs per project milestone and duration.

Assessed the reasonableness of the significant assumptions, corroborated the progress of the contracted research and development costs with the Company’s operations personnel and to information obtained by the Company directly from third parties, and to information in contracts or statements of work including costs for those activities and project duration.

Examined subsequent invoices received from contracted research and development cost third parties.

audit matters are matters arising from the current period audit of the financial statements that were communicated or required to be

communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and

(2) involved our especially challenging, subjective, or complex judgments.

We determined that there are no critical audit matters.

have served as the Company’s auditor since 2021.

Hanover, New Jersey

New Jersey March 28, 2025

BIOSCIENCES, INC.

7 unchanged sentences

Property and equipment, net

Right-of-use operating lease asset

Intangible assets, net

3 unchanged sentences

Accounts payable

Due to related parties

Accrued liabilities

Current portion of right-of-use operating lease obligation

Investment option liability

Warrant liability

Derivative liability

Total current liabilities

17 unchanged sentences

Total liabilities, mezzanine equity, and shareholders’ equity

accompanying notes are an integral part of these consolidated financial statements.

BIOSCIENCES, INC.

5 unchanged sentences

Research and development

Impairment of intangible assets and goodwill

Depreciation and amortization

3 unchanged sentences

( 16,448,440 )

Other (expense) income

Other income (expense)

Inducement expense, net

3 unchanged sentences

Change in fair value of derivative liability

Interest income (expense), net

Total other (expense) income

Interest income, net

Total other income (expense)

Net loss before income taxes

1 unchanged sentence

( 17,262,819 )

Income tax (expense) benefit

Income tax expense

( 9,574,987 )

12 unchanged sentences

Weighted average shares outstanding, basic and diluted

accompanying notes are an integral part of these consolidated financial statements.

BIOSCIENCES, INC.

1 unchanged sentence

STATEMENTS OF CHANGES IN MEZZANINE EQUITY AND SHAREHOLDERS’ EQUITY

Redeemable Non-controlling Interest

Total Mezzanine Equity

Additional Paid-In Capital

Subscription Receivable

Accumulated Deficit

Accumulated Other Comprehensive Loss

Total Shareholders’ Equity

FOR THE YEAR ENDED DECEMBER 31, 2024

Additional Paid-In

Accumulated Other Comprehensive

Shareholders’

Balance at January 1, 2024

1 unchanged sentence

$ ( 1,817,640 )

Preferred dividends attributable to redeemable non-controlling interest

Accretion of embedded derivative to redemption value

Redemption of Series A preferred

$ ( 96,499,518 )

$ ( 569,749 )

Common stock sold under the Equity Distribution Agreement, net of offering costs of $ 583,713

Issuance of direct offering shares (see Note 8)

Exercise of Inducement Warrants for common stock

Stock-based compensation

Issuance of common shares in exchange for RSU conversions

Issuance of common shares for deferred offering costs

Issuance of Inducement Warrants, net of offering costs of $ 239,302

Induced conversion of warrants and preferred investment options

Exercise of warrants and preferred investment options

( 1,537,140 )

Issuance of common shares for vested RSU

Proceeds from the subscription receivable related to the issuance of Inducement Warrants, net of offering costs of $ 12,821

Proceeds from the subscription receivable related to the exercise of warrants and preferred investment options and issuance of common stock in abeyance

Common stock sold under the Purchase Agreement, net of offering costs of $ 471,756

Foreign exchange translation loss

5 unchanged sentences

$ ( 594,517 )

$ ( 569,749 )

accompanying notes are an integral part of these consolidated financial statements.

BIOSCIENCES, INC.

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STATEMENTS OF CHANGES IN MEZZANINE EQUITY AND SHAREHOLDERS’ EQUITY

Series C Redeemable Preferred Stock

FOR THE YEAR ENDED DECEMBER 31, 2023

Redeemable Non-controlling Interest

Total Mezzanine Equity

Additional Paid-In Capital

Accumulated Deficit

Accumulated Other Comprehensive Loss

Total Shareholders’ Equity

Total Mezzanine

Additional Paid-In

Accumulated Other Comprehensive

Shareholders’

Balance at January 1, 2023

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$ ( 536,734 )

February 2022 registered direct offering, net of offering costs

Stock-based compensation

Conversion of RSUs into common shares

Redeemable non-controlling interest, net of $ 402,000 embedded derivative and net of issuance costs of $ 41,962

Issuance of redeemable Series C preferred stock

$ ( 79,207,786 )

$ ( 536,734 )

Preferred dividends attributable to redeemable non-controlling interest

Accretion of embedded derivative to redemption value

Conversion of RSAs into common shares

July 2022 registered direct offering, PIPE offering, modification of warrants and exercise of pre-funded warrants, net of offering costs

Issuance of rounded shares as a result of the reverse stock split

Redemption of Series C preferred stock

Redemption of Series A preferred stock

( 1,052,057 )

Stock-based compensation

Issuance of common shares for vested RSU

Issuance of common shares for deferred offering costs

Issuance of Inducement Warrants, net of offering costs of $ 239,302

Induced conversion of warrants and preferred investment options

Exercise of warrants and preferred investment options

( 1,537,140 )

Foreign exchange translation loss

6 unchanged sentences

$ ( 569,749 )

$ 100,841,416

$ ( 1,817,640 )

$ ( 96,499,518 )

$ ( 569,749 )

accompanying notes are an integral part of these consolidated financial statements.

BIOSCIENCES, INC.

7 unchanged sentences

Change in fair value of warrant liability

( 4,315,236 )

Change in fair value of investment option liability

( 3,472,726 )

Change in fair value of derivative liability

1 unchanged sentence

Inducement expense

Impairment of intangibles

Non-cash income tax benefit

( 1,504,302 )

Amortization of ROU asset

Deferred offering costs expensed

Amortization of right of use asset

Amortization of intangibles

4 unchanged sentences

Accounts payable and accrued liabilities

Due to related parties

Right-of-use operating lease asset and obligation

5 unchanged sentences

Proceeds from disposal of property and equipment

Net cash provided by (used in) investing activities

Net cash provided by investing activities

Cash Flows From Financing Activities:

Proceeds from sale of common stock, warrants, and investment options, net of offering costs

Proceeds from the subscription receivable related to the issuance of Inducement Warrants and the exercise of warrants and preferred investment options

Proceeds from exercise of Inducement Warrants

Proceeds from common stock sold under the Equity Distribution Agreement, net of offering costs

Proceeds from common stock sold under the Purchase Agreement, net of offering costs

Payment for offering costs previously accrued

Payment for equity distribution offering costs

1 unchanged sentence

( 1,052,057 )

Proceeds from the sale of redeemable non-controlling interest, net of offering costs

Net cash (used in) provided by financing activities

Net cash provided by (used in) financing activities

( 1,343,141 )

Effect of foreign exchange rate on changes on cash

Net (decrease) increase in cash

Net decrease in cash

( 15,435,907 )

1 unchanged sentence

Cash at end of year

Supplemental disclosure of cash and non-cash transactions:

Supplemental disclosure of cash flow transactions:

Cash paid for interest

Income taxes paid

Warrants issued in conjunction with common stock issuance

BIOSCIENCES, INC.

AND SUBSIDIARIES

STATEMENTS OF CASH FLOWS

Issuance of embedded derivative

Non-cash financing and investing activities:

Stock subscription receivable

1 unchanged sentence

Warrants issued for offering costs

Issuance of common shares for deferred offering costs

Issuance of common shares for offering costs

Deferred offering costs charged to offering costs

Induced conversion of warrants and preferred investment options

Preferred dividends attributable to redeemable non-controlling interest

Investment options issued in conjunction with common stock issuance

Modification of warrants as part of share capital raise

Accretion of embedded derivative to redemption value

accompanying notes are an integral part of these consolidated financial statements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

BUSINESS AND LIQUIDITY AND OTHER UNCERTAINTIES

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Biosciences, Inc.

(“Enveric” or the “Company”) is a biotechnology company developing novel neuroplastogenic small-molecule

therapeutics for the treatment of depression, anxiety, and addiction disorders.

The head office of the Company is located in Naples,

(“Enveric” or the “Company”) is a biotechnology company dedicated to the development of novel

neuroplastogenic small-molecule therapeutics for the treatment of depression, anxiety, addiction, and other psychiatric disorders.

head office of the Company is located in Naples, Florida.

The Company has the following wholly-owned subsidiaries:

Jay Pharma Inc.

(“Jay Pharma”), 1306432 B.C.

MagicMed Industries, Inc.

(“MagicMed”), Enveric Canada Inc., and Enveric Therapeutics, Pty.

Pharma”), 1306432 B.C.

Ltd., 1236567 B.C.

Unlimited Liability Company, MagicMed Industries, Inc.

(“MagicMed”), Enveric

Biosciences Canada Inc., Akos Biosciences, Inc.

(“Akos”), and Enveric Therapeutics, Pty.

(“Enveric Therapeutics”).

its unique discovery and development platform, The Psybrary™, Enveric has created a robust Intellectual Property portfolio of New

Chemical Entities for specific mental health indications.

Enveric’s lead program, the EVM201 Series, comprises next generation

synthetic prodrugs of the active metabolite, psilocin.

Enveric is developing the first product from the EVM201 Series – EB-373

– for the treatment of psychiatric disorders.

Enveric is also advancing its second program, the EVM301 Series, expected to offer

a first-in-class, new approach to the treatment of difficult-to-address mental health disorders, mediated by the promotion of neuroplasticity

without also inducing hallucinations in the patient.

the Company’s amalgamation with MagicMed completed in September 2021 (the “Amalgamation”), the Company has continued

to pursue the development of MagicMed’s proprietary Psychedelic Derivatives library, the Psybrary™ which the Company believes

will help to identify and develop the right drug candidates needed to address mental health challenges, including cancer-related distress.

The Company synthesizes novel versions of classic psychedelics, such as psilocybin, DMT, mescaline and MDMA, using a mixture of chemistry

and synthetic biology, resulting in the expansion of the Psybrary™, which includes 15 patent families with over a million potential

variations and hundreds of synthesized molecules.

Within the Psybrary™ the Company has three different types of molecules, Generation

1 (classic psychedelics), Generation 2 (pro-drugs), and Generation 3 (new chemical entities).

The Company is working to add novel psychedelic

molecular compounds and derivatives (“Psychedelic Derivatives”) on a regular basis through its work at the Company’s

labs in Calgary, Alberta, Canada, where the Company has a team of PhD scientists with expertise in synthetic biology and chemistry.

date the Company has created over 500 molecules that are housed in the Psybrary™.

Company screens newly synthesized molecules in the Psybrary™ through PsyAI™, a proprietary artificial intelligence (“AI”)

Leveraging AI systems is expected to reduce the time and cost of pre-clinical, clinical, and commercial development.

believes it streamlines pharmaceutical design by predicting ideal binding structures of molecules, manufacturing capabilities, and pharmacological

effects to help determine ideal drug candidates, tailored to each indication.

Each of these molecules that the Company believes are patentable

can then be further screened to see how changes to its makeup alter its effects in order to synthesize additional new molecules.

compounds of sufficient purity are undergoing pharmacological screening, including non-clinical (receptors/cell lines), preclinical (animal),

and ultimately clinical (human) evaluations.

The Company intends to utilize the Psybrary™ and the AI tool to categorize and characterize

the Psybrary™ substituents to focus on bringing more psychedelics-inspired molecules from discovery to the clinical phase.

March 21, 2023, the Company established Enveric Therapeutics, an Australia-based subsidiary, to support the Company’s plans to

advance its lead program, the EVM201 Series, comprised of the next generation synthetic prodrugs of the active metabolite, psilocin (“EVM201

Series”), towards the clinic.

Enveric Therapeutics will oversee the Company’s preclinical, clinical, and regulatory activities

in Australia, including ongoing interactions with the local Human Research Ethics Committees (HREC) and the Therapeutic Goods Administration

(TGA), Australia’s regulatory authority.

lead program, the EVM301 Series, and its lead drug candidate, EB-003, are intended to offer a first-in-class, new approach to the treatment

of difficult-to-address mental health disorders, mediated by the promotion of neuroplasticity and without also inducing hallucinations

in the patient.

Previously, Enveric was developing the EVM201 Series, and its lead drug candidate EB-002 (formerly EB-373), for the treatment

of neuropsychiatric disorders.

The EVM201 series comprised next generation synthetic prodrugs of the active metabolite, psilocin.

Enveric out-licensed the EVM201 Series program to MycoMedica Life Sciences, who will seek to develop, manufacture, and commercialize

EB-002, in exchange for certain development and milestone payments to Enveric.

Our primary focus is to develop our lead asset EB-003

in the EVM301 Series.

Company effected a 1-for-15 reverse stock split (“Reverse Stock Split”) on January 27, 2025, which began trading on a split-adjusted

basis on January 29, 2025, pursuant to which every 15 shares of the Company’s issued and outstanding common stock were reclassified

as one share of common stock.

The Reverse Stock Split had no impact on the par value of the Company’s common stock or the authorized

number of shares of common stock.

Unless otherwise indicated, all share and per share information in these consolidated financial statements

are retroactively adjusted to reflect the Reverse Stock Split, prior to the rounding of any fractional shares.

Any fractional share resulting

from the Reverse Stock Split were rounded up to the next whole number of shares, upon which 87,131 roundup shares were issued in January

Concern, Liquidity and Other Uncertainties

Company has incurred a loss since inception resulting in an accumulated deficit of $ 96,499,518 as of December 31, 2023 and further losses

Company has incurred losses since inception resulting in an accumulated deficit of $ 106,074,505 as of December 31, 2024 and further losses

are anticipated in the development of its business.

6 unchanged sentences

These factors raise substantial

doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these financial

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these consolidated

financial statements.

assessing the Company’s ability to continue as a going concern, the Company monitors and analyzes its cash and its ability to generate

2 unchanged sentences

cash of $ 2,241,026 and working capital of $ 1,244,848 .

The Company’s current cash on hand is not sufficient enough to satisfy its

operating cash needs for the 12 months from the filing of this Annual Report on Form 10-K.

These conditions raise substantial doubt regarding

the Company’s ability to continue as a going concern for a period of one year after the date the financial statements are issued.

Management’s plan to alleviate the conditions that raise substantial doubt include raising additional working capital through public

or private equity or debt financings or other sources, which has included the Equity Distribution Agreement with Canaccord for proceeds

of up to $ 2.4 million (see Note 7), the Purchase Agreement with Lincoln Park (see Note 7), subject to registration, the Inducement Letters

and resulting sales of common stock under the Existing Warrants for cash proceeds of $ 1.8 million received in January 2024 (see Note

7), and the exercise of warrants to purchase 1,954,000 shares of common stock for cash proceeds of approximately $ 2.7 million in February

2024 (see Note 12), and may include additional collaborations with third parties as well as disciplined cash spending.

Adequate additional

financing may not be available to us on acceptable terms, or at all.

Should the Company be unable to raise sufficient additional capital,

the Company may be required to undertake cost-cutting measures including delaying or discontinuing certain operating activities.

In January 2025, the Company raised net proceeds of approximately $ 4.2 million

from a public stock offering.

The Company’s current cash on hand is not sufficient enough to satisfy its operating

cash needs for the 12 months from the filing of this Annual Report on Form 10-K.

These conditions raise substantial doubt regarding the

Company’s ability to continue as a going concern for a period of one year after the date the consolidated financial statements

Management’s plan to alleviate the conditions that raise substantial doubt include raising additional working capital

through public or private equity or debt financings or other sources, and may include additional collaborations with third parties as

well as disciplined cash spending.

Adequate additional financing may not be available to the Company on acceptable terms, or at all.

Should the Company be unable to raise sufficient additional capital, the Company may be required to undertake further cost-cutting measures

including delaying or discontinuing certain operating activities.

a result of these factors, management has concluded that there is substantial doubt about the Company’s ability to continue as

a going concern for a period of one year after the date of the financial statements are issued.

The Company’s consolidated financial

statements do not include any adjustments that might result from the outcome of this uncertainty.

in Force/Restructuring

May 2023, the Company entered into a cost reduction plan, including a reduction in force (“RIF”) of approximately 35% of

its full-time employees to streamline its operations and conserve cash resources.

Additionally, contracts with seven consultants that

were focused on the Akos cannabinoid spin-out were terminated.

The Company recognized severance charges of approximately $ 453,059 through

December 31, 2023.

The plan included a focus on progressing the Company’s existing non-cannabinoid pipeline while reducing the

rate of spend and managing cash flow.

In June 2023, the Company completed the reduction in force, with such severance expenses recorded

in general and administrative accounts.

June 16, 2023, the Company entered into a separation agreement with Avani Kanubaddi, the Company’s President and Chief Operating

Officer (the “Kanubaddi Separation Agreement”).

In accordance with the Kanubaddi Separation Agreement, Mr.

outstanding restricted stock units (“RSUs”) will retain their vesting conditions.

Kanubaddi’s 2023 salary and benefits

of $ 550,974 , inclusive of the 2023 performance bonus in the amount of $ 129,760 were accrued and the salary and benefits, excluding the

2023 performance bonus will be paid out in twelve equal monthly installments beginning in July 2023.

As of December 31, 2023, the performance

metrics for the 2023 performance bonus were not achieved and the accrued amount of amount of $ 129,760 was reversed.

Upon termination,

any unvested time-based RSUs became fully vested.

The Company accelerated expense recognized related to these shares that vested was

All of the 11,278 market performance-based RSUs previously granted that were subject to the original terms and conditions of

Kanubaddi’s employment agreement were forfeited during the year ended December 31, 2023.

OF RESTRUCTURING COSTS PAYABLE

Restructuring Costs

January 1, 2023 Beginning balance

Restructuring costs incurred

Restructuring costs paid

Restructuring costs reversed

December 31, 2023 ending balance

Company considers the current inflationary trend existing in the North American economic environment reasonably likely to have a material

unfavorable impact on results of continuing operations.

Higher rates of price inflation, as compared to recent prior levels of price

inflation, have caused a general increase in the cost of labor and materials.

In addition, there is an increased risk of the Company

experiencing labor shortages due to a potential inability to attract and retain human resources due to increased labor costs resulting

from the current inflationary environment.

November 21, 2023, the Company received a letter from the Listing Qualifications Department of the Nasdaq Stock Market stating that as

of September 30, 2023, the Company did not meet the minimum of $ 2,500,000 in stockholders’ equity required for continued listing

pursuant to Nasdaq Listing Rule 5550(b)(1).

On February 6, 2024, the Company received a letter from Nasdaq, granting the Company an extension

to regain compliance with the minimum stockholders’ equity requirement by May 20, 2024.

If the Company fails to evidence compliance

upon filing its periodic report for June 30, 2024 with the SEC and Nasdaq, the Company may be subject to delisting.

The Company plans

to regain and evidence compliance with the Stockholders’ Equity Requirement by the required deadlines, but it is not assured.

a going concern for a period of one year after the date of the consolidated financial statements are issued.

The Company’s consolidated

financial statements do not include any adjustments that might result from the outcome of this uncertainty.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

May 16, 2024, the Company received a letter from Nasdaq notifying the Company that for the prior 30 consecutive business days the bid

price for the Company’s common stock had closed below the minimum $ 1.00 per share requirement for continued inclusion on Nasdaq

pursuant to Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Rule”).

The deficiency letter did not result in the immediate

delisting of the Company’s common stock from Nasdaq.

In accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company was provided

an initial period of 180 calendar days, until November 12, 2024, to regain compliance with the Bid Price Rule.

On November 20, 2024,

Nasdaq issued a delisting notice, indicating that the Company did not satisfy the Bid Price Rule by the compliance date and that unless

the Company requested an appeal of this determination before Nasdaq’s listing qualifications panel, the Company’s common

stock would be scheduled for delisting from Nasdaq and trading suspended.

The Company appealed the determination before Nasdaq’s

listing qualifications panel and on December 30, 2024, the Company received an extension until May 19, 2025, to regain compliance with

Bid Price Rule.

The Company has applied for a second 180-day compliance period.

The Company conducted the Reverse Stock Split on January

27, 2025, which became effective January 29, 2025, in order to regain compliance with the Minimum Bid Price Requirement.

has notified NASDAQ on February 11, 2025 that the Company has completed steps to cure the deficiency and regain compliance.

4, 2025, the Company received notice from the Nasdaq Office of General Counsel that the Company regained compliance with the Bid Price

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1 unchanged sentence

accompanying consolidated financial statements have been prepared in accordance and in conformity with U.S.

generally accepted accounting principles (“GAAP”) and the applicable rules

and regulations of the Securities and Exchange Commission (the “SEC”) regarding consolidated financial information.

All intercompany

transactions have been eliminated in consolidation.

preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions

generally accepted accounting

principles (“GAAP”) and the applicable rules and regulations of the Securities and Exchange Commission (the “SEC”)

regarding consolidated financial information.

All intercompany transactions have been eliminated in consolidation.

preparation of the consolidated financial statements in conformity with U.S.

GAAP requires management to make estimates and assumptions

that affect the reported amount of assets and liabilities at the date of the financial statements and expenses during the periods reported.

2 unchanged sentences

Significant areas requiring management’s estimates and assumptions include determining

the fair value of transactions involving common stock, the valuation of warrants and preferred investment options, and the valuation

of stock-based compensation and accruals associated with third party providers supporting research and development efforts.

Actual results

could differ from those estimates.

the fair value of transactions involving common stock, the valuation of warrants and preferred investment options, the valuation of stock-based

compensation and accruals associated with third party providers supporting research and development efforts.

Actual results could differ

from those estimates.

Currency Translation

inception through December 31, 2024, the reporting currency of the Company was the United States dollar while the functional currency

of certain of the Company’s subsidiaries was the Canadian dollar and Australian dollar.

For the reporting periods ended December

of certain of the Company’s subsidiaries was the Canadian dollar or the Australian dollar.

For the years ended December 31, 2024

and 2023, the Company engaged in a number of transactions denominated in Canadian dollars and Australian dollars.

the Company is subject to exposure from changes in the exchange rates of the Canadian dollar and Australian dollar against the United

States dollar.

As a result, the Company

is subject to exposure from changes in the exchange rates of the Canadian dollar and Australian dollar against the United States dollar.

Company translates the assets and liabilities of its Canadian subsidiaries and Australian subsidiary into the United States dollar at

13 unchanged sentences

Company did not have any cash equivalents as of December 31, 2024 and 2023.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Concentration

1 unchanged sentence

instruments that potentially subject the Company to concentrations of credit risk consist of cash accounts in a financial institution,

which at times, may exceed the federal depository insurance coverage of $ 250,000 in the United States and Australia and $ 100,000 in Canada.

The Company has not experienced losses on these accounts, and management believes the Company is not exposed to significant risks on

such accounts.

As of December 31, 2023, the Company had greater than $ 250,000 at United States financial institutions, less than $ 250,000

at Australian financial institutions, and greater than $ 100,000 at Canadian financial institutions.

which at times, may exceed the federal depository insurance coverage of $ 250,000 in the United States, AUD$ 250,000 in Australia and C$ 100,000

The Company has not experienced losses on these accounts, and management believes the Company is not exposed to significant

risks on such accounts.

As of December 31, 2024, the Company had greater than $ 250,000 at United States financial institutions, less

than AUD$ 250,000 at Australian financial institutions, and less than C$ 100,000 at Canadian financial institutions.

As of December 31, 2023,

the Company had greater than $ 250,000 at United States financial institutions, less than AUD$ 250,000 at Australian financial institutions,

and greater than C$ 100,000 at Canadian financial institutions.

Comprehensive

loss consists of two components, net loss and other comprehensive income (loss).

Other comprehensive loss refers to revenue, expenses,

gains, and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net loss.

loss consists of two components, net loss and other comprehensive loss.

Other comprehensive loss refers to revenue, expenses, gains,

and losses that under GAAP are recorded as an element of shareholders’ equity but are excluded from net loss.

Other comprehensive

1 unchanged sentence

dollar as their functional currency.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

assets consist of the Psybrary™ and Patent Applications, In Process Research and Development (“IPR&D”) and license

Psybrary™ and Patent Applications intangible assets are valued using the relief from royalty method.

The cost of license

agreements is amortized over the economic life of the license.

The Company assesses the carrying value of its intangible assets for impairment

intangible assets are acquired in conjunction with the acquisition of a business and are assigned a fair value, using the multi-period

excess earnings method, related to incomplete research projects which, at the time of acquisition, have not reached technological feasibility.

The amounts are capitalized and are accounted for as indefinite-lived intangible assets, subject to impairment testing until completion

or abandonment of the projects.

Upon successful completion of each project, the Company will make a determination as to the then-useful

life of the intangible asset, generally determined by the period in which the substantial majority of the cash flows are expected to

be generated, and begin amortization.

The Company tests its intangible assets for impairment at least annually and whenever events or

circumstances change that indicate impairment may have occurred.

A significant amount of judgment is involved in determining if an indicator

of impairment has occurred.

Such indicators may include, among others and without limitation:

a significant decline in the Company’s

expected future cash flows;

a sustained, significant decline in the Company’s stock price and market capitalization;

a significant

adverse change in legal factors or in the business climate of the Company’s segments;

unanticipated competition;

and slower growth

If the fair value determined is less than the carrying amount, an impairment loss is recognized in operating results.

Company tests goodwill for potential impairment at least annually, or more frequently if an event or other circumstance indicates that

the Company may not be able to recover the carrying amount of the net assets of the reporting unit.

The Company has determined that the

reporting unit is the entire company, due to the integration of all of the Company’s activities.

In evaluating goodwill for impairment,

the Company may assess qualitative factors to determine whether it is more likely than not (that is, a likelihood of more than 50%) that

the fair value of a reporting unit is less than its carrying amount.

If the Company bypasses the qualitative assessment, or if the Company

concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then the Company performs

a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount.

assets consist of a license agreement.

The cost of license agreements is amortized over the economic life of the license.

assesses the carrying value of its intangible assets for impairment each year.

and equipment are recorded at cost.

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with Lincoln Park Capital Fund, LLC (“Lincoln Park”).

These deferred offering costs will be proportionately offset against

the total proceeds from the issuance of common stock available under the agreements and the Company will expense any remaining balance

of deferred offering costs if the agreements are terminated.

For the year ended December 31, 2023, there were no issuances of common

stock under the agreements resulting in the deferral of offering costs.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

These deferred offering costs were proportionately offset against the

total proceeds from the issuance of common stock available under the agreements and the Company expensed any remaining balance of deferred

offering costs when the agreements were terminated.

As of December 31, 2024, the Company expensed the remaining balance of deferred offering

costs related to Lincoln Park as the Company no longer intends to use this purchase agreement, reflected in general and administration

expenses in the accompanying consolidated statement of operations.

As of December 31, 2024, the balance of deferred offering costs is

the year ended December 31, 2023, the Company incurred $ 567,603 in deferred offering costs in connection with the Distribution Agreement,

with Canaccord and the Purchase Agreement with Lincoln Park.

These deferred offering costs will be proportionately offset against the

total proceeds from the issuance of common stock available under the agreements and the Company will expense any remaining balance of

deferred offering costs if the agreements are terminated.

For the year ended December 31, 2023, there were no issuances of common stock

under the agreements resulting in the deferral of offering costs.

Liability and Investment Options

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to such common stock warrants will be reclassified to additional paid-in capital.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

and Inducement of Warrants and Investment Options

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of the instrument could be required within 12 months of the balance sheet date.

and Development

and development expenses are charged to operations as incurred.

Research and development expenses include, among other things, internal

and external costs associated with preclinical development, pre-commercialization manufacturing expenses, and clinical trials.

accrues for costs incurred as the services are being provided by monitoring the status of the trial or services provided and the invoices

received from its external service providers.

In the case of clinical trials, a portion of the estimated cost normally relates to the

projected cost to treat a patient in the trials, and this cost is recognized based on the number of patients enrolled in the trial.

actual costs become known, the Company adjusts its accruals accordingly.

and Development Tax Incentive Receivable

Company, through its wholly-owned subsidiary in Australia, participates in the Australian research and development tax incentive program,

such that a percentage of the Company’s qualifying research and development expenditures are reimbursed by the Australian government,

and such incentives are reflected as a reduction of research and development expense.

The Australian research and development tax incentive

is recognized when there is reasonable assurance that the incentive will be received, the relevant expenditure has been incurred and

the amount of the consideration can be reliably measured.

At each period end, management estimates the reimbursement available to the

Company based on available information at the time.

Company utilizes an asset and liability approach for financial accounting and reporting for income taxes.

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AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

Company’s policy for recording interest and penalties associated with tax audits is to record such items as a component of operating

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The Company is in the process

of filing its United States federal and state and Australian federal corporate tax returns for the year ended December 31, 2023.

Company is in the process of filing its Canadian corporate tax returns for the years ended December 31, 2023 and 2022.

Net operating

losses for these periods will not be available to reduce future taxable income until the returns are filed.

of filing its United States federal and state, Australian federal, and Canadian corporate tax returns for the year ended December 31,

Net operating losses for these periods will not be available to reduce future taxable income until the returns are filed.

Company follows ASC 718, Compensation - Stock Compensation, which addresses the accounting for stock-based payment transactions, requiring

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AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

value of RSA’s is equal to the product of the number of restricted shares awarded, multiplied by the closing price per share of

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to expense on the date awarded, value of RSA’s that vest based upon time, or achievement of stock price levels over a period of

time are charged to expense on a straight-line basis over the time frame specified in the RSU.

time are charged to expense on a straight-line basis over the time frame specified in the RSA.

Loss per Share

net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period.

Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding

Diluted loss per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding

during the period.

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of weighted average shares outstanding for the purposes of calculating basic and diluted earnings per share.

the year ended December 31, 2022 the Company issued 767,500 pre-funded common stock warrants, which were exercised on various dates during

the year ended December 31, 2022.

The pre-funded common stock warrants became exercisable on July 26, 2022 based on the terms and conditions

of the agreements.

As the pre-funded common stock warrants are exercisable for $ 0.0001 , these shares are considered outstanding common

shares and are included in the computation of basic and diluted Earnings Per Share as the exercise of the pre-funded common stock warrants

is virtually assured.

The Company included these pre-funded common stock warrants in basic and diluted earnings per share when all conditions

were met on July 26, 2022.

In accordance with ASC 260,

14,586 RSAs that were fully vested on December 31, 2024 were included in basic and dilutive earnings per share as there were no remaining

contingencies for these shares to be issued as of December 31, 2024.

The shares were issued during January 2025.

dilutive securities outlined in the table below have been excluded from the computation of diluted net loss per share the years ended

December 31, 2024 and 2023 because the effect of their inclusion would have been anti-dilutive.

OF POTENTIALLY DILUTIVE SECURITIES

SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES

For the years ended December 31,

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Restricted stock units - unvested

Restricted stock awards - vested and unissued

Common stock in abeyance

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fair value of the Company’s assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value

Measurements and Disclosures” (“ASC 820”), approximates the carrying amounts in the balance sheets, excluding the derivative,

warrants, and preferred investment option liabilities, primarily due to their short-term nature.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Measurements and Disclosures” (“ASC 820”), approximates the carrying amounts in the balance sheets, excluding the warrants

and preferred investment option liabilities, primarily due to their short-term nature.

Value Measurements

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inputs that are observable or can be corroborated by observable market data.

3 - Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by

other market participants.

3 - Valuations based on unobservable inputs reflecting the Company’s own assumptions, consistent with reasonably available assumptions

made by other market participants.

These valuations require significant judgment.

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31, 2024 and 2023 because of their short-term nature.

and Development

and development expenses are charged to operations as incurred.

Research and development expenses include, among other things, internal

and external costs associated with preclinical development, pre-commercialization manufacturing expenses, and clinical trials.

accrues for costs incurred as the services are being provided by monitoring the status of the trial or services provided and the invoices

received from its external service providers.

In the case of clinical trials, a portion of the estimated cost normally relates to the

projected cost to treat a patient in the trials, and this cost is recognized based on the number of patients enrolled in the trial.

actual costs become known, the Company adjusts its accruals accordingly.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

lease assets are included within right-of-use operating lease asset and operating lease liabilities are included in current portion of

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The present value of the lease payments is calculated using either the implicit interest rate in the lease or an incremental borrowing

The Company did not have any operating leases as of December 31, 2024 and 2023.

lease qualifies as a finance lease if any of the following criteria are met at the inception of the lease:

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leases as of December 31, 2024 and 2023.

Non-controlling Interest

connection with the issuance of Akos Series A Preferred Stock, the Akos Purchase Agreement (as defined below in Note 8) and certificate

of designation contain a put right guaranteed by the Company as defined in Note 8.

Applicable accounting guidance requires an equity

instrument that is redeemable for cash or other assets to be classified outside of permanent equity if it is redeemable (a) at a fixed

or determinable price on a fixed or determinable date, (b) at the option of the holder, or (c) upon the occurrence of an event that is

not solely within the control of the issuer.

As a result of this feature, the Company recorded the non-controlling interests as Redeemable

Non-Controlling Interests (“RNCI”) and classified them in mezzanine equity within its consolidated balance sheet initially

at its acquisition-date estimated redemption value or fair value.

In addition, the Company has elected to recognize changes in the redemption

value immediately as they occur and adjust the carrying amount of the instrument by accreting the embedded derivative at each reporting

period over 12 months.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

May 2023, pursuant to the Akos Series A Preferred Certificate of Designations, the holders of the Akos Series A Preferred Stock exercised

the Put Right (as defined below) requiring Akos to force redemption of all of the Akos Series A Preferred Stock.

Company determines its reporting units in accordance with FASB ASC 280, “Segment Reporting” (“ASC 280”).

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if the segments are economically similar and, if so, the operating segments are aggregated.

The Company has multiple operations related

to psychedelics and cannabinoids.

Both of these operations exist under one reporting unit:

The Company has one operating segment

and reporting unit.

The Company is organized and operated as one business.

Management reviews its business as a single operating segment,

using financial and other information rendered meaningful only by the fact that such information is presented and reviewed in the aggregate.

Company operates as one operating segment with a focus on developing novel neuroplastogenic small-molecule therapeutics for the treatment

of depression, anxiety, and addiction disorders.

The Company’s Chief Executive Officer (“CEO”) as the Chief Operating

Decision Maker (“CODM”), manages and allocates resources to the operations of the Company on a consolidated basis.

loss from operations, which is reported in the accompanying consolidated statements of operations, is the measure of segment profit or

loss that is regularly reviewed by the CODM.

This enables the CEO to assess the overall level of available resources and determine how

best to deploy these resources across research and development projects in line with the long-term company-wide strategic goals.

to the accompanying consolidated statements of operations for the presentation of consolidated loss from operations for the years ended

December 31, 2024 and 2023.

The measure of segment assets is reported in the accompanying consolidated balance sheets as “Total

assets.” There are no significant segment expenses as the expenses that are included in consolidated loss from operations are general

and administrative and research and development.

Accounting Pronouncements

August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives

and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify certain financial

ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features

from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts

in an entity’s own equity.

The new standard also introduces additional disclosures for convertible debt and freestanding instruments

that are indexed to and settled in an entity’s own equity.

ASU 2020-06 amends the diluted earnings per share guidance, including

the requirement to use the if-converted method for all convertible instruments.

ASU 2020-06 is effective for fiscal years beginning after

December 15, 2023, and should be applied on a full or modified retrospective basis.

Early adoption is permitted, but no earlier than

fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

The Company early adopted ASU 2020-06

effective January 1, 2023, and has determined that the adoption of this guidance had no impact on its consolidated financial statements.

November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

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beginning after December 15, 2024.

Early adoption is permitted.

The amendments should be applied retrospectively to all prior periods

presented in the financial statements.

The Company is currently evaluating ASU 2023-07 to determine its impact on the Company’s

disclosures, however, as the Company currently has one reportable segment, the Company does not expect ASU 2023-07 to have a material

The amendments should be applied retrospectively to all prior periods presented in the financial statements.

The Company has adopted ASU 2023-07, and this guidance did not have a material impact on the Company’s consolidated financial statements.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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adoption and retrospective application are permitted.

Early adoption is permitted.

The Company is currently assessing potential impacts

of ASU 2023-09 and does not expect the adoption of this guidance will have a material impact on its consolidated financial statements

and disclosures.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company has adopted ASU 2023-09 effective January 1, 2025.

The Company is in

the process of evaluating the impact of ASU 2023-09 on the Company’s consolidated financial statements which will be reflected

in the December 31, 2025 financial statements.

November 2024, the FASB issued ASU 2024-03, Income Statement (Topic 220):

Reporting Comprehensive Income - Expense Disaggregation

Disclosures, Disaggregation of Income Statement Expenses , that requires public companies to disclose, in interim and reporting periods,

additional information about certain expenses in the financial statements.

In January 2025, the FASB issued ASU No.

2025-01, Income

Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Clarifying the Effective.

2024-03, as clarified by ASU 2025-01, is effective for annual periods beginning after December 15, 2026 and interim reporting periods

beginning after December 15, 2027.

Early adoption is permitted and is effective on either a prospective basis or retrospective basis.

The Company is currently assessing the potential impacts of ASU 2024-03.

PREPAID EXPENSES AND OTHER CURRENT ASSETS

of December 31, 2024 and 2023, the prepaid expenses and other current assets of the Company consisted of the following:

OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

December 31, 2023

December 31, 2022

Prepaid research and development

SCHEDULE OF PREPAID EXPENSES AND OTHER CURRENT ASSETS

Prepaid value-added taxes

Prepaid insurance

Prepaid other

Deferred offering costs

Prepaid insurance

Prepaid research and development

Deferred offering costs (see Note 8)

Franchise tax receivable

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Total prepaid expenses and other current assets

INTANGIBLE ASSETS AND GOODWILL

Company performs an annual impairment test at the reporting unit level as of December 31 of each fiscal year.

As of December 31, 2022,

the Company’s goodwill and intangible assets were fully impaired, and thus no annual impairment test was necessary as of December

The following table provides the Company’s goodwill, indefinite and definite lives intangible assets as of December 31,

2023 and 2022.

of December 31, 2022, the Company’s goodwill consisted of:

Accumulated Impairment Losses

Currency Translation

Balance at January 1, 2022

$ ( 8,225,862 )

Impairment losses

( 1,486,060 )

Loss on currency translation

Balance at December 31, 2022

( 9,711,922 )

of December 31, 2022, the Company’s indefinite lived intangible assets consisted of:

OF INTANGIBLE ASSETS

Indefinite lived intangible assets

Balance at January 1, 2022

Impairment losses

( 5,967,602 )

Loss on currency translation

Balance at December 31, 2022

As of December 31, 2023 and 2022, the definite lived intangible assets consisted of:

INTANGIBLE ASSETS

of December 31, 2024 and 2023, the Company’s intangible assets, which are located in the United States, consisted of:

SCHEDULE OF INTANGIBLE ASSETS

Definite lived intangible assets

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Balance at December 31, 2024

identified definite lived intangible assets, amortization expense amounted to $ 168,754 and $ 168,750 during the years ended December 31,

2023 and 2022, respectively.

identified definite lived intangible assets, there was no impairment expense during the years ended December 31, 2024 and 2023.

For identified

definite lived intangible assets, amortization expense amounted to $ 168,750 and $ 168,754 during the years ended December 31, 2024 and

2023, respectively.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

Company amortizes definite lived intangible assets on a straight-line basis over their estimated useful lives.

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PROPERTY AND EQUIPMENT

and equipment consists of the following assets which are located in Calgary, Canada and placed in service by Enveric Biosciences Canada,

(“EBCI”), with all amounts translated into U.S.

SCHEDULE OF PROPERTY PLANT AND EQUIPMENT NET OF ACCUMULATED DEPRECIATION

December 31, 2023

December 31, 2022

and equipment consists of the following assets which are located in Calgary, Canada, with all amounts translated into U.S.

OF PROPERTY AND EQUIPMENT NET OF ACCUMULATED DEPRECIATION

Lab equipment

Computer equipment and leasehold improvements

Property and equipment, gross

Accumulated depreciation

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of December 31, 2024 and December 31, 2023, the accrued liabilities of the Company consisted of the following:

OF ACCRUED LIABILITIES

December 31, 2023

December 31, 2022

SCHEDULE OF ACCRUED LIABILITIES

Product development

4 unchanged sentences

Total accrued expenses

RELATED PARTY TRANSACTIONS

of December 31, 2024, there was $ 232,891 due to related parties.

This balance is related to payments due to board members of the Company.

Board member Sheila DeWitt has provided research and development services as an advisory consultant to the Company since May 2022.

services are provided as needed on an hourly basis.

During the year ended December 31, 2024, the Company incurred $ 189,125 in service

fees related to these services.

Of these fees, $ 176,125 has been paid and $ 13,000 is included in due to related parties on the consolidated

balance sheet as of December 31, 2024.

There was no balance outstanding at December 31, 2023.

SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS

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for distribution.

As of December 31, 2023, 100,000,000 shares of common stock and 20,000,000 shares of Preferred Stock were authorized

under the Company’s articles of incorporation.

As of December 31, 2024 and December 31, 2023, 100,000,000 shares of common stock and 20,000,000 shares of Preferred

Stock were authorized under the Company’s articles of incorporation.

Distribution Agreement

September 1, 2023, the Company entered into the Distribution Agreement, with Canaccord, pursuant to which the Company may offer and sell

from time to time, through Canaccord as sales agent and/or principal, shares of common stock of the Company, par value $ 0.01 per share

having an aggregate offering price of up to $ 10.0 million.

Due to the offering limitations applicable to the Company and in accordance

with the terms of the Distribution Agreement, the Company may offer common stock having an aggregate gross sales price of up to $ 2,392,514

pursuant to the prospectus supplement dated September 1, 2023 (the “Prospectus Supplement”).

Subject to the terms and conditions

of the Distribution Agreement, Canaccord may sell the common stock by any method permitted by law deemed to be an “at-the-market

The Company will pay Canaccord a commission equal to 3.0 % of the gross sales price of the common stock sold through

Canaccord under the Distribution Agreement and has also agreed to reimburse Canaccord for certain expenses.

The Company may also sell

common stock to Canaccord as principal for Canaccord’s own account at a price agreed upon at the time of sale.

Any sale of common stock to Canaccord as principal would be pursuant to the terms of a separate terms agreement between the Company and Canaccord.

September 1, 2023, the Company entered into the Equity Distribution Agreement (the “Distribution Agreement”), with Canaccord,

Genuity LLC (“Canaccord”) pursuant to which the Company may offer and sell from time to time, through Canaccord as sales

agent and/or principal, shares of common stock of the Company having an aggregate offering price of up to $ 10.0 million.

Due to the offering

limitations applicable to the Company and in accordance with the terms of the Distribution Agreement, the Company may offer Common Stock

having an aggregate gross sales price of up to $ 2,392,514 pursuant to the prospectus supplement dated September 1, 2023 (the “Prospectus

Supplement”).

Subject to the terms and conditions of the Distribution Agreement, Canaccord may sell the Common Stock by any method

permitted by law deemed to be an “at-the-market offering”.

The Company will pay Canaccord a commission equal to 3.0 % of the

gross sales price of the Common Stock sold through Canaccord under the Distribution Agreement and has also agreed to reimburse Canaccord

for certain expenses.

The Company may also sell Common Stock to Canaccord as principal for Canaccord’s own account at a price agreed

upon at the time of sale.

Any sale of Common Stock to Canaccord as principal would be pursuant to the terms of a separate terms agreement

between the Company and Canaccord.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Inducement Letters (as defined below within this Note 7) prohibits the Company from entering into any variable rate transaction as defined

in the Inducement Letters, including the issuance of (1) any variable priced debt or equity securities or (2) transactions whereby the

Company may issue securities at a future determined price, such as through an at-the-market offering or an equity line of credit.

variable rate transaction restriction expires after six-month from the closing date of December 28, 2023 for the Inducement Letters for

an issuance through an at-the-market offering, and one-year for the remaining variable rate transactions.

Subsequent to December 31, 2023, the limitation on the at-the-market offering was waived.

TO CONSOLIDATED FINANCIAL STATEMENTS

December 28, 2023, the Company entered into warrant exercise inducement offer letters (the “Inducement Letters”) with certain

holders (the “Holders”) of the warrants that were modified in July 2022 (the “February 2022 Post-Modification Warrants”)

and registered direct (“RD”) and the private investment in public equity (“PIPE”) preferred investment options

to purchase shares of the Company’s common stock (the “Existing Warrants and Investment Options”) pursuant to which

the Holders agreed to exercise for cash their Existing Warrants and Investment Options to purchase 74,800 shares of the Company’s

common stock, in the aggregate, at a reduced exercised price of $ 20.55 per share (from an original exercise price of $ 116.70 per share),

in exchange for the Company’s agreement to issue new warrants (the “Inducement Warrants”) to purchase up to 149,600

shares of the Company’s common stock (the “Inducement Warrant Shares”), and the Holders to make a cash payment of $ 1.88

per Inducement Warrant share for total proceeds of $ 280,500 .

In January 2024, the Company received aggregate gross proceeds of $ 1,817,640

from the exercise of the Existing Warrants and Investment Options by the Holders and the sale of the Inducement Warrants.

Existing Warrants and Investment Options by the Holders and the sale of the Inducement Warrants that exercised on December 28, 2023 and

unsettled until January 2024, the proceeds are included in the consolidated balance sheet as a subscription receivable as of December

As of December 31, 2023, 27,867 shares of the Existing Warrants and Investment Options exercised were considered issued as

the Company had the enforceable right to obtain the cash proceeds, which were in-transit, and the Holders were no longer able to rescind

the exercise election.

Due to the beneficial ownership limitation provisions, 46,934 shares of the Existing Warrants and Investment Options

exercised were initially unissued and held in abeyance for the benefit of the Holder until notice is received from the Holder that the

shares may be issued in compliance with such limitation.

During the year ended December 31, 2024, the Company issued all 46,934 shares

of common stock of the 46,934 shares of Existing Warrants and Investment Options exercised that were held in abeyance due to the beneficial

ownership limitation provisions.

December 28, 2023, the Company entered into warrant exercise inducement offer letters (the “Inducement Letters”) with certain

holders of warrants and preferred investment options.

The Inducement Letters prohibit the Company from entering into any variable rate

transaction as defined in the Inducement Letters, including the issuance of (1) any variable priced debt or equity securities or (2)

transactions whereby the Company may issue securities at a future determined price, such as through an at-the-market offering or an equity

line of credit.

The variable rate transaction restriction would have expired after six-months from the closing date of December 28, 2023

for the Inducement Letters for an issuance through an at-the-market offering, and one-year for the remaining variable rate transactions,

however the restriction was waived for the at-the-market offering on March 8, 2024 and the equity line on May 3, 2024.

March 8, 2024, the Company entered into a series of common stock purchase agreements for the issuance in a registered direct offering

of 15,246 shares of the Company’s common stock to the Holders of the Inducement Warrants.

The issuance was made in exchange for

the permanent and irrevocable waiver of the variable rate transaction limitation solely with respect to the entry into and/or issuance

of shares of common stock in an at the market offering contained in the Inducement Letters.

The fair value of the shares issued for consideration

of waiving the variable rate transaction limitation was $ 322,453 and was charged to additional paid in capital, as it is direct and incremental

to the Distribution Agreement, on the consolidated balance sheet as an offering cost related to the Distribution Agreement.

the year ended December 31, 2024, the Company issued 111,200 shares of common stock for gross proceeds of $ 2,392,502 under the Distribution

Agreement, and charged offering costs of $ 583,713 to additional paid in capital on the consolidated balance sheet.

As of December 31,

2024 and December 31, 2023, there were deferred offering costs related to the Distribution Agreement of $ 0 and $ 171,944 , respectively.

As of December 31, 2024, there is $ 0 available under the Distribution Agreement.

Park Equity Line

November 3, 2023, the Company entered into a Purchase Agreement and a registration rights agreement (the “Registration Rights Agreement”),

with Lincoln Park, pursuant to which Lincoln Park has committed to purchase up to $ 10.0 million of the Company’s common stock,

par value $ 0.01 per share subject to certain limitations and satisfaction of the conditions set forth in the Purchase Agreement.

November 3, 2023, the Company entered into a Purchase Agreement (the “Purchase Agreement”) and a registration rights agreement

(the “Registration Rights Agreement”), with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which

Lincoln Park has committed to purchase up to $ 10.0 million of the Company’s common stock, subject to certain limitations and satisfaction

of the conditions set forth in the Purchase Agreement.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

the terms and subject to the conditions of the Purchase Agreement, the Company has the right, but not the obligation, to sell to Lincoln

4 unchanged sentences

over the 24-month period commencing on the date that the conditions to Lincoln Park’s purchase obligation set forth in the Purchase

Agreement are satisfied, including that a registration statement on Form S-1 covering the resale of the shares of our common stock that

have been and may be issued to Lincoln Park under the Purchase Agreement, which the Company has filed with the SEC pursuant to the Registration

Rights Agreement, is declared effective by the SEC and a final prospectus relating thereto is filed with the SEC.

the purchase price per share to be paid by Lincoln Park for the shares of common stock that we may elect to sell to Lincoln Park under

the Purchase Agreement, if any, will fluctuate based on the market prices of our Common Stock at the time we elect to sell shares to

Lincoln Park pursuant to the Purchase Agreement, if any, it is not possible for us to predict the number of shares of Common Stock that

we will sell to Lincoln Park under the Purchase Agreement, the purchase price per share that Lincoln Park will pay for shares purchased

from us under the Purchase Agreement, or the aggregate gross proceeds that we will receive from those purchases by Lincoln Park under

the Purchase Agreement.

the year ended December 31, 2023, the Company has issued no shares of common stock through the Equity Line or the Distribution Agreement.

The Company had capitalized deferred offering costs of $ 567,603 related to establishing the Distribution Agreement with Canaccord and

the Purchase Agreement with Lincoln Park and no reductions to additional paid in capital.

Of this amount, $ 255,107 represents the fair

value of 139,403 shares of common stock issued to Lincoln Park as consideration for its commitment under the Purchase Agreement.

Agreement are satisfied, including that a registration statement on Form S-1 covering the resale of the shares of the Company’s

Common Stock that have been and may be issued to Lincoln Park under the Purchase Agreement, which the Company has filed with the SEC

pursuant to the Registration Rights Agreement, is declared effective by the SEC and a final prospectus relating thereto is filed with

As required under the Purchase Agreement, the Company registered a resale of 76,032 shares of the Company’s common stock,

plus the 9,294 commitment shares, by Lincoln Park on a registration statement on Form S-1 dated November 8, 2023, which was declared

effective by the SEC on December 5, 2023.

As of July 30, 2024, there were no remaining shares available to be issued in connection with

this registration statement.

On September 4, 2024, the Company filed an amended Form S-1, which was declared effective by the SEC on

September 11, 2024.

The amended Form S-1 registered an additional 326,667 shares of common stock that are available to be issued to Lincoln

Park in connection with this agreement.

the purchase price per share to be paid by Lincoln Park for the shares of Common Stock that the Company may elect to sell to Lincoln

Park under the Purchase Agreement, if any, will fluctuate based on the market prices of the Company’s Common Stock at the time

the Company elects to sell shares to Lincoln Park pursuant to the Purchase Agreement, if any, it is not possible for the Company to predict

the number of shares of Common Stock that the Company will sell to Lincoln Park under the Purchase Agreement, the purchase price per

share that Lincoln Park will pay for shares purchased from the Company under the Purchase Agreement, or the aggregate gross proceeds

that the Company will receive from those purchases by Lincoln Park under the Purchase Agreement.

May 3, 2024, the Company entered into a series of common stock purchase agreements for the issuance in a registered direct offering of

an aggregate of 30,534 shares of the Company’s common stock, to certain institutional investors.

The issuance was made in exchange

for the permanent and irrevocable waiver of the variable rate transaction limitation with respect to any existing or future agreement

by the Company to effect any issuance of shares and issue such shares thereunder, as contained in those certain Inducement Offer Letters,

dated December 28, 2023, between the Company and those certain institutional investors.

The Company will not receive any net proceeds

in connection with the offering.

The fair value of the shares issued for consideration of waiving the variable rate transaction limitation

was $ 448,840 and was recorded as deferred offering costs, as direct and incremental to the Purchase Agreement, within prepaid expenses

and other current assets on the consolidated balance sheet related to the Purchase Agreement.

common stock purchase agreements contain customary representations and warranties and certain indemnification obligations of the Company.

The common stock purchase agreements also restrict the Company from issuing, entering into any agreement to issue, or announcing the

issuance of the Company’s common stock from the date of the common stock purchase agreements until the earlier of 30 days after

entering into the agreements or at such time as one million ( 1,000,000 ) shares of the Company’s common stock have traded in the

The closing of the issuance of the Shares pursuant to the common stock purchase agreements closed on May 3, 2024.

the year ended December 31, 2024, the Company had issued 159,366 shares of common stock, through the Purchase Agreement for gross cash

proceeds of $ 1,083,709 .

During the year ended December 31, 2024, the Company charged offering costs of $ 471,756 to additional paid in

capital on the consolidated balance sheet.

As of December 31, 2024 and 2023, the Company has capitalized deferred offering costs of $ 0

and $ 395,660 , respectively.

As of December 31, 2024, there were 243,334 shares available to be issued in connection with the Purchase

The Company engaged in a best efforts public offering in the first quarter of 2025 (described below), which restricts the

use of the Lincoln Park Equity Line for a period of one year from February 3, 2025.

Stock Activity

the year ended December 31, 2023 a total of 103,641 shares of common stock were issued pursuant to the conversion of restricted stock

During the year ended December 31, 2022, a total of 1,223 and 899 shares of common stock were issued pursuant to the conversion

of restricted stock awards and restricted stock units, respectively.

February 15, 2022, the Company completed a public offering of 400,000 shares of common stock and warrants to purchase up to 400,000 shares

of common stock for gross proceeds of approximately $ 10.0 million, before deducting underwriting discounts and commissions and other

offering expenses.

A.G.P./Alliance Global Partners acted as sole book-running manager for the offering.

In addition, Enveric granted

the underwriter a 45-day option to purchase up to an additional 60,000 shares of common stock and/or warrants to purchase up to an additional

60,000 shares of common stock at the public offering price, which the underwriter has partially exercised for warrants to purchase up

to 60,000 shares of common stock.

At closing, Enveric received net proceeds from the offering of approximately $ 9.1 million, after deducting

underwriting discounts and commissions and estimated offering expenses with $ 5.8 million allocated to equity, $ 3.6 million to warrant

liability and the remaining $ 0.3 million recorded as an expense.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

July 22, 2022, the Company entered into a securities purchase agreement (the “Registered Direct Securities Purchase Agreement”)

with an institutional investor for the purchase and sale of 116,500 shares of the Company’s common stock, pre-funded warrants to

purchase up to 258,500 shares of common stock (the “RD Pre-Funded Warrants”), and unregistered preferred investment options

(the “RD Preferred Investment Options”) to purchase up to 375,000 shares of common stock (the “RD Offering”).

The gross proceeds from the RD Offering were approximately $ 3,000,000 .

Subject to certain ownership limitations, the RD Pre-Funded Warrants

became immediately exercisable at an exercise price equal to $ 0.0001 per share of common stock.

On August 3, 2022, all of the issued

RD Pre-Funded Warrants were exercised.

with the RD Offering, the Company entered into a securities purchase agreement (the “PIPE Securities Purchase Agreement”)

with institutional investors for the purchase and sale of 116,000 shares of common stock, pre-funded warrants to purchase up to 509,000

shares of common stock (the “PIPE Pre-Funded Warrants”), and preferred investment options (the “PIPE Preferred Investment

Options”) to purchase up to 625,000 shares of the common stock in a private placement (the “PIPE Offering”).

proceeds from the PIPE Offering were approximately $ 5,000,000 .

Subject to certain ownership limitations, the PIPE Pre-Funded Warrants

became immediately exercisable at an exercise price equal to $ 0.0001 per share of common stock.

All of the issued PIPE Pre-Funded Warrants

were exercised on various dates prior to August 18, 2022.

RD Offering and PIPE Offering closed on July 26, 2022, with aggregate gross proceeds of approximately $ 8 million.

The aggregate net proceeds

from the offerings, after deducting the placement agent fees and other estimated offering expenses, were approximately $ 7.1 million,

with $ 3.2 million allocated to equity, $ 4.3 million to investment option liability, and the remaining $ 0.4 million recorded as an expense.

the year ended December 31, 2024 a total of 1,830 shares of common stock were issued pursuant to the vesting of restricted stock units.

During the year ended December 31, 2023 a total of 6,910 shares of common stock were issued pursuant to the vesting of restricted stock

to 2020 Long-Term Incentive Plan

May 3, 2022, our board of directors (“Board”) adopted the First Amendment (the “Plan Amendment”) to the Enveric

May 3, 2022, the board of directors (“Board”) adopted the First Amendment (the “Plan Amendment”) to the Enveric

Biosciences, Inc.

2020 Long-Term Incentive Plan (the “Incentive Plan”) to (i) increase the aggregate number of shares available

for the grant of awards by 146,083 shares to a total of 200,000 shares, and (ii) add an “evergreen” provision whereby the

number of shares authorized for issuance pursuant to awards under the Incentive Plan will be automatically increased on the first trading

date immediately following the date the Company issues any share of common stock (defined below) to any person or entity, to the extent

necessary so that the number of shares of the Company’s common stock authorized for issuance under the Incentive Plan will equal

the greater of (x) 200,000 shares, and (y) 15% of the total number of shares of the Company’s common stock outstanding as of such

issuance date (the “Evergreen Provision”).

The Plan Amendment was approved by the Company’s shareholders at a special

meeting of the Company’s shareholders held on July 14, 2022.

November 2, 2023, the shareholders approved the amendments to the 2020 Long-Term Incentive Plan, which was approved by the Board on August

for the grant of awards by 9,739 shares to a total of 13,334 shares, and (ii) add an “evergreen” provision whereby the number

of shares authorized for issuance pursuant to awards under the Incentive Plan will be automatically increased on the first trading date

immediately following the date the Company issues any share of common stock (defined below) to any person or entity, to the extent necessary

so that the number of shares of the Company’s common stock authorized for issuance under the Incentive Plan will equal the greater

of (x) 13,334 shares, and (y) 15% of the total number of shares of the Company’s common stock outstanding as of such issuance date

(the “Evergreen Provision”).

The Plan Amendment was approved by the Company’s shareholders at a special meeting of

the Company’s shareholders held on July 14, 2022.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

November 2, 2023, the stockholders approved the amendments to the 2020 Long-Term Incentive Plan, which was approved by the Board on August

8, 2023 (the “Amended Incentive Plan”).

The Amended Incentive Plan (i) increased the number of authorized shares reserved

for issuance under the Amended Incentive Plan to a maximum of 350,000 , subject to adjustment, and (ii) removed the Evergreen Provision

implemented in the Plan Amendment.

As of December 31, 2023, the total number of shares available for grant under the Incentive Plan was

for issuance under the Amended Incentive Plan to a maximum of 23,334 , subject to equitable adjustment, and (ii) removed the Evergreen

Provision implemented in the Plan Amendment.

During the first quarter of 2024, the Board approved an equitable adjustment to increase

the number of shares available under the Plan by 8,986 shares.

Effective October 9, 2024, the Board approved an equitable adjustment

to increase the number of shares available under the Incentive Plan by 64,402 shares, which increased the total number of authorized

shares under the Incentive Plan to 96,721 shares.

As of December 31, 2024, the total number of shares available for grant under the Incentive

Plan was 25,659 .

summary of the stock option activity under the Company’s incentive plan for the years ended December 31, 2024 and 2023 is presented

9 unchanged sentences

Exercisable at December 31, 2024

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

granted during the years ended December 31, 2022 were valued using the Black Scholes model with the following assumptions:

SCHEDULE OF STOCK OPTION ASSUMPTION

December 31, 2022

Exercise price

Dividend yield

Expected volatility

Risk free interest rate

above assumptions are determined by the Company as follows:

price – Based on closing price of the Company’s common stock on the date of grant.

average risk-free interest rate — Based on the daily yield curve rates for U.S.

Treasury obligations with maturities, which

correspond to the expected term of the Company’s stock options.

yield — The Company has not paid any dividends on common stock since its inception and does not anticipate paying dividends

on its common stock in the foreseeable future.

volatility — Based on the historical volatility of comparable companies in a similar industry.

term — The Company has had no stock options exercised since inception.

The expected option term represents the period that

stock-based awards are expected to be outstanding based on the simplified method provided in Staff Accounting Bulletin (“SAB”)

107, Share-Based Payment, which averages an award’s weighted-average vesting period and expected term for “plain

vanilla” share options.

Company’s stock based compensation expense, recorded within general and administrative expense, related to stock options for the

years ended December 31, 2023 and 2022 was $ 156,075 and $ 180,042 , respectively.

Company’s stock based compensation expense, recorded within general and administrative expense in the consolidated statement of

operations and comprehensive loss, related to stock options for the years ended December 31, 2024 and 2023 was $( 5,441 ) and $ 156,075 ,

respectively.

of December 31, 2024, the Company had $ 1,932 in unamortized stock option expense, which will be recognized over a weighted average period

of 1.15 years.

the years ended December 31, 2023 and 2022, the Company recorded $ 0 and $ 24,363 , respectively, in stock-based compensation expense within

general and administrative expense, related to restricted stock awards.

There were no RSA grants during the years ended December 31,

2023 and 2022.

As of December 31, 2022, there were no unvested RSA shares.

As of December 31, 2023, there were no unamortized stock-based

compensation costs related to restricted share awards.

During the year ended December 31, 2023 the Company settled the 708 vested and

unissued shares (as of December 31, 2022) for cash of $ 14,250 .

There are no restricted stock awards as of December 31, 2023.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

of Restricted Stock Units

Company’s activity in restricted stock units was as follows for the year ended December 31, 2024:

SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY

SCHEDULE OF RESTRICTED STOCK UNITS

Number of shares

Weighted average

Weighted average fair value

Non-vested at January 1, 2023

6 unchanged sentences

compensation costs related to restricted stock units of $ 892,536 which will be recognized over a weighted average period of 1.91 years.

and unamortized stock-based costs related to restricted stock units which will be recognized upon achievement of specified milestones.

As of December 31, 2024, 1,369 restricted stock units are vested without shares of common stock being issued, with all of these shares

due as of December 31, 2024.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

following table summarizes the Company’s recognition of stock-based compensation for restricted stock units for the following periods:

SCHEDULE OF STOCK-BASED COMPENSATION FOR RESTRICTED STOCK UNITS

OF STOCK-BASED COMPENSATION FOR RESTRICTED STOCK UNITS

Year ended December 31,

2 unchanged sentences

Research and development

Stock-based compensation expense for RSUs

Stock-based compensation

expense for RSUs

Company’s activity in restricted common stock was as follows for the years ended December 31, 2024:

OF RESTRICTED STOCK UNITS

Number of shares

Weighted average fair value

Non-vested at January 1, 2024

Non-vested at December 31, 2024

the years ended December 31, 2024 and 2023, the Company recorded $ 91,886 and $ 0 , respectively, in stock-based compensation expense within

general and administrative expense, related to restricted stock awards.

As of December 31, 2024, there were no unamortized stock-based

compensation costs related to restricted share awards.

The balance of Common Shares related to the vested restricted stock awards as

of December 31, 2024 will be issued during the 2025 calendar year.

There are 14,586 vested and unissued shares of restricted stock awards

as of December 31, 2024.

These shares were issued during the first quarter of 2025.

and Preferred Investment Options

following table summarizes information about shares issuable under warrants outstanding at December 31, 2024 and 2023:

OF WARRANTS OUTSTANDING

SCHEDULE OF WARRANTS OUTSTANDING

Warrant shares outstanding

3 unchanged sentences

Outstanding at January 1, 2023

Exchanged for common stock

Outstanding at December 31, 2023

3 unchanged sentences

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On February 11, 2022, the Company entered into an underwriting agreement (the “Underwriting Agreement”)

with A.G.P./Alliance Global Partners (the “Underwriter”).

Pursuant to the Underwriting Agreement, the Company agreed to sell,

in a firm commitment offering, 400,000 shares of the Company’s common stock and accompanying warrants to purchase up to an aggregate

of 400,000 shares of its common stock (“February 2022 Warrants”), as well as up to 60,000 additional shares of common stock

and/or warrants to purchase an aggregate of up to 60,000 shares of its common stock that may be purchased by the Underwriter pursuant

to a 45-day option granted to the Underwriter by the Company (the “Offering”).

Each share of common stock was sold together

with a common warrant to purchase one share of common stock, at an exercise price of $ 27.50 per share.

Such common warrants were immediately

exercisable and will expire five years from the date of issuance.

There is not expected to be any trading market for the common warrants

issued in the Offering.

The combined public offering price of each share of common stock and accompanying common warrant sold in the Offering

was $ 25.00 .

On February 14, 2022, the Underwriter exercised its option to purchase an additional 60,000 warrants.

connection with the Registered Direct (“RD”) Offering and the Private Investment in Public Entity (“PIPE”) Offering

entered into on July 22, 2022, the Company entered into Warrant Amendment (the “Warrant Amendments”) with the investors in

both offerings to amend certain existing warrants to purchase up to an aggregate of 122,000 shares of common stock that were previously

issued to the investors, with an exercise price of $ 27.50 per share (subsequent to the 1-for-50 reverse stock split that occurred on

July 14, 2022) and expiration date of February 15, 2027 .

Pursuant to the Warrant Amendments, the previously issued warrants were amended,

effective upon the closing of the offerings, so that the amended warrants have a reduced exercise price of $ 7.78 per share and expire

five and one-half years following the closing of the offerings.

In connection with this transaction, the Company determined the fair

value of the February 2022 Warrants immediately prior to the Warrant Amendment and the fair value of the amended warrants immediately

after the Warrant Amendment.

For the year ended December 31, 2022, the incremental change in fair value was deemed to be $ 251,357 , which was included as equity issuance costs

related to the RD and PIPE financing transactions.

warrants assumed pursuant to the acquisition of MagicMed contain certain down round features, which were not triggered by the February

2022 and July 2022 public offerings, that would require adjustment to the exercise price upon certain events when the offering price

is less than the stated exercise price.

TO CONSOLIDATED FINANCIAL STATEMENTS

following table summarizes information about investment options outstanding at December 31, 2024 and 2023:

OF WARRANTS AND INVESTMENT OPTIONS

SCHEDULE OF INVESTMENT OPTIONS

Investment options outstanding

4 unchanged sentences

Outstanding at December 31, 2023

( 1,000,000 )

Outstanding at December 31, 2024

Exercisable at December 31, 2024

connection with the Registered Direct Securities Purchase Agreement the Company issued unregistered preferred investment options to purchase

up to 375,000 shares of common stock.

Subject to certain ownership limitations, the RD Preferred Investment Options became immediately

exercisable at an exercise price equal to $ 7.78 per share of common stock.

The RD Preferred Investment Options are exercisable for five

and one-half years from the date of issuance.

connection with the PIPE Securities Purchase Agreement the Company issued unregistered preferred investment options to purchase up to

625,000 shares of the common stock.

Subject to certain ownership limitations, PIPE Preferred Investment Options became immediately exercisable

at an exercise price equal to $ 7.78 per share of common stock.

The PIPE Preferred Investment Options are exercisable for five and one-half

years from the date of issuance.

July 26, 2022, in connection with the RD Offering and PIPE Offering, the Company issued preferred investment options (the “Placement

Agent Preferred Investment Options”) to an entity to purchase up to 70,000 shares of the common stock for acting as a placement

The Placement Agent Preferred Investment Options have substantially the same terms as the RD Preferred Investment Options and

the PIPE Preferred Investments Options, except the Placement Agent Preferred Investment Options have an exercise price of $ 10.00 per

The Placement Agent Preferred Investment Options are exercisable for five years from the date of the commencement of the RD Offering

and PIPE Offering.

December 28, 2023, the Company entered into warrant exercise inducement offer letters (the “Inducement Letters”) with

certain holders (the “Holders”) of the February 2022 Post-Modification Warrants and RD and PIPE preferred investment

options to purchase shares of the Company’s common stock (the “Existing Warrants and Investment Options”) pursuant

to which the Holders agreed to exercise for cash their Existing Warrants and Investment Options to purchase 1,122,000

shares of the Company’s common stock, in the aggregate, at a reduced exercised price of $ 1.37

per share (from an original exercise price of $ 7.78

per share), in exchange for the Company’s agreement to issue new warrants (the “Inducement Warrants”) to purchase

up to 2,244,000

shares of the Company’s common stock (the “Inducement Warrant Shares”), and the Holders to make a cash payment of

per Inducement Warrant share for total proceeds of $ 280,500 .

In January 2024, the Company received aggregate gross proceeds of $ 1,817,640

from the exercise of the Existing Warrants and Investment Options by the Holders and the sale of the Inducement Warrants.

the Existing Warrants and Investment Options by the Holders and the sale of the Inducement Warrants that exercised on December 28,

2023 and unsettled until January 2024, the proceeds are included in the consolidated balance sheet as a subscription receivable as

of December 31, 2023.

As of December 31, 2023, 418,000

shares of the Existing Warrants and Investment Options exercised were considered issued as the Company had the enforceable right to

the obtain the cash proceeds, which were in-transit, and the Holders were no longer able to rescind the exercise election.

the beneficial ownership limitation provisions, 704,000

shares of the Existing Warrants and Investment Options exercised were initially unissued and held in abeyance for the benefit of the

Holder until notice is received from the Holder that the shares may be issued in compliance with such limitation.

Company engaged Roth Capital Partners, LLC (“Roth”) to act as its financial advisor in connection with the transactions

summarized above and will pay Roth approximately $144,000 for its services, in addition to reimbursement for certain expenses.

was also issued warrants to purchase up to 67,320 shares of common stock.

The Roth Warrants have the same terms as the Inducement

The grant date fair value of these Roth Warrants was estimated to be $77,991 on December 28, 2023 and were charged to

additional paid in capital as issuance costs.

The Company also incurred legal fees of $17,254 related to the transactions above that

were charged to additional paid in capital as issuance costs.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 28, 2023, the Company entered into warrant exercise inducement offer letters (the “Inducement Letters”) with certain

holders (the “Holders”) of the February 2022 Post-Modification Warrant and RD and PIPE preferred investment options to purchase

shares of the Company’s common stock (the “Existing Warrants and Investment Options”) pursuant to which the Holders

agreed to exercise for cash their Existing Warrants and Investment Options to purchase 74,800 shares of the Company’s common stock,

in the aggregate, at a reduced exercised price of $ 20.55 per share (from an original exercise price of $ 116.70 per share), in exchange

for the Company’s agreement to issue new warrants (the “Inducement Warrants”) to purchase up to 149,600 shares of the

Company’s common stock (the “Inducement Warrant Shares”), and the Holders to make a cash payment of $ 1.88 per Inducement

Warrant share for total proceeds of $ 280,500 .

In January 2024, the Company received aggregate gross proceeds of $ 1,817,640 from the exercise

of the Existing Warrants and Investment Options by the Holders and the sale of the Inducement Warrants.

Because the Existing Warrants

and Investment Options by the Holders and the sale of the Inducement Warrants that exercised on December 28, 2023 and unsettled until

January 2024, the proceeds are included in the consolidated balance sheet as a subscription receivable as of December 31, 2023.

December 31, 2023, 27,867 shares of the Existing Warrants and Investment Options exercised were considered issued as the Company had

the enforceable right to the obtain the cash proceeds, which were in-transit, and the Holders were no longer able to rescind the exercise

Due to the beneficial ownership limitation provisions, 46,934 shares of the Existing Warrants and Investment Options exercised

were initially unissued and held in abeyance for the benefit of the Holder until notice is received from the Holder that the shares may

be issued in compliance with such limitation.

The Company engaged Roth Capital Partners, LLC (“Roth”) to act as its financial

advisor in connection with the transactions summarized above and has paid Roth approximately $144,000 for its services, in addition to

reimbursement for certain expenses.

Roth was also issued warrants to purchase up to 4,488 shares of common stock.

The Roth Warrants have

the same terms as the Inducement Warrants.

The grant date fair value of these Roth Warrants was estimated to be $77,991 on December 28,

2023 and were charged to additional paid in capital as issuance costs.

The Company also incurred legal fees of $17,254 related to the

transactions above that were charged to additional paid in capital as issuance costs.

Company also agreed to file a registration statement on Form S-3 covering the resale of the Inducement Warrant Shares issued or issuable

4 unchanged sentences

See the Equity Distribution Agreement section of this Note.

connection with this transaction, the Company determined the fair value of the Existing Warrants and Investment Options immediately

prior to the Inducement Letters and the fair value of the amended warrants and investment options immediately after the Inducement

The pre-modification measurement of fair value of the Existing Warrants and Investment Options were determined utilizing a

Black-Scholes model considering all relevant assumptions current at the date of modification (i.e.

for the Existing Warrants share

price of $ 1.56 ,

exercise price of $ 7.78 ,

years, volatility of 94 %,

risk-free rate of 3.96 %,

and expected dividend rate of 0 %,

resulting in a fair value per share of $ .54 and for the Investment Options share price of $ 1.56 ,

exercise price of $ 7.78 ,

term of 4.1 years,

volatility of 95 %,

risk-free rate of 3.90 %,

and expected dividend rate of 0 %,

resulting in a fair value per share of $ .62 ).

The total fair value of the 122,000 Existing Warrants and 1,000,000 Investment Options

was $ 65,349 and $ 618,648 , respectively.

The post-modification fair value was determined using the intrinsic value of $ 0.19

due to the inducement and totaled $ 23,180 and $ 190,000 for the Existing Warrants and Investment Options, respectively.

The change in fair value from the date of the modification prior to modification and the fair value on the

date of the modification after the modification, but prior to exercise was $ 470,817 ,

which was reflected as an inducement gain, within other expenses on the Company’s consolidated statement of operations and

comprehensive loss.

connection with this transaction, the Company determined the fair value of the Existing Warrants and Investment Options immediately prior

to the Inducement Letters and the fair value of the amended warrants and investment options immediately after the Inducement Letters.

The pre-modification measurement of fair value of the Existing Warrants and Investment Options were determined utilizing a Black-Scholes

model considering all relevant assumptions current at the date of modification (i.e.

for the Existing Warrants share price of $ 23.40 ,

exercise price of $ 116.70 , term of 3.6 years, volatility of 94 %, risk-free rate of 3.96 %, and expected dividend rate of 0 %, resulting

in a fair value per share of $ 8.10 and for the Investment Options share price of $ 23.40 , exercise price of $ 116.70 , term of 4.1 years,

volatility of 95 %, risk-free rate of 3.90 %, and expected dividend rate of 0 %, resulting in a fair value per share of $ 9.30 ).

fair value of the 8,134 Existing Warrants and 66,667 Investment Options was $ 65,349 and $ 618,648 , respectively.

The post-modification

fair value was determined using the intrinsic value of $ 2.85 due to the inducement and totaled $ 23,180 and $ 190,000 for the Existing

Warrants and Investment Options, respectively.

The change in fair value from the date of the modification prior to modification and the

fair value on the date of the modification after the modification, but prior to exercise was $ 470,817 , which was reflected as an inducement

gain, within other expenses on the Company’s consolidated statement of operations and comprehensive loss.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

grant date fair value of these Inducement Warrants was estimated to be $ 2,599,552 on December 28, 2023 and the proceeds of $ 280,500 ,

16 unchanged sentences

May 3, 2022, the Board of Directors (the “Board”) declared a dividend of one one-thousandth of a share of the Company’s

Series C Preferred Stock (“Series C Preferred Stock”) for each outstanding share of the Company’s common stock held of record as of 5:00 p.m.

Series C Preferred Stock (“Series C Preferred Stock”) for each outstanding share of the Company’s common stock held

of record as of 5:00 p.m.

Eastern Time on May 13, 2022 (the “Record Date”).

This dividend

was based on the number of outstanding shares of common stock prior to the Reverse Stock Split.

The outstanding shares of Series C Preferred

Stock were entitled to vote together with the outstanding shares of the Company’s common stock, as a single class, exclusively

with respect to a proposal giving the Board the authority, as it determines appropriate, to implement a reverse stock split within twelve

months following the approval of such proposal by the Company’s stockholders (the “Reverse Stock Split Proposal”),

as well as any proposal to adjourn any meeting of stockholders called for the purpose of voting on the Reverse Stock Split Proposal (the

“Adjournment Proposal”).

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

This dividend was based on the number of outstanding

shares of common stock prior to the Reverse Stock Split.

The outstanding shares of Series C Preferred Stock were entitled to vote together

with the outstanding shares of the Company’s common stock, as a single class, exclusively with respect to a proposal giving the

Board the authority, as it determines appropriate, to implement a reverse stock split within twelve months following the approval of

such proposal by the Company’s stockholders (the “Reverse Stock Split Proposal”), as well as any proposal to adjourn

any meeting of stockholders called for the purpose of voting on the Reverse Stock Split Proposal (the “Adjournment Proposal”).

Company held a special meeting of stockholders on July 14, 2022 (the “Special Meeting”) for the purpose of voting on, among

15 unchanged sentences

and Related Private Placement

connection with the Spin-Off, on May 5, 2022, Akos and the Company entered into into a Securities Purchase Agreement (the “Akos

Purchase Agreement”) with an accredited investor (the “Akos Investor”), pursuant to which Akos agreed to sell up to

an aggregate of 5,000 shares of Akos Series A Preferred Stock, at price of $ 1,000 per share, and warrants (the “Akos Warrants”)

to purchase shares of Akos’ common stock, par value $ 0.01 per share (the “Akos Common Stock”), for an aggregate purchase

price of up to $ 5,000,000 (the “Akos Private Placement”).

connection with the Spin-Off, on May 5, 2022, Akos and the Company entered into into a Securities

Purchase Agreement (the “Akos Purchase Agreement”) with an accredited investor (the “Akos Investor”) ,

pursuant to which Akos agreed to sell up to an aggregate of 5,000 shares of Akos Series A Preferred Stock, at price of $ 1,000 per share,

and warrants (the “Akos Warrants”) to purchase shares of Akos’ common stock, par value $ 0.01 per share (the “Akos

Common Stock”), for an aggregate purchase price of up to $ 5,000,000 (the “ Akos

Private Placement ” ).

The Akos Purchase Agreement was guaranteed by the Company.

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been redeemed.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

of Akos Series A Preferred Stock

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of the purchase price for the shares purchased under the Put Right.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Akos Series A Preferred Certificate of Designations contains limitations that prevent the holder thereof from acquiring shares of Akos

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AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

LICENSING AGREEMENTS

July 10, 2024, Akos entered into an Exclusive License Agreement (the “License Agreement”) with Aries Science and Technology,

LLC, an Ohio limited liability company (“Aries”), pursuant to which Akos granted Aries a license of Akos’s patented

radiation dermatitis topical product.

The license allows Akos to use the patented formulation to develop pharmaceutical or non-pharmaceutical

products for treating radiation dermatitis suitable for administration to humans or animals.

The license is exclusive (subject to certain

exceptions contained in the License Agreement), worldwide, royalty-bearing, and includes the right to sublicense.

Akos is entitled to

potential license payments, milestone payments and royalties based on net revenues of the Licensed Product on a licensed product-by-licensed

product and country-by-country basis pursuant to the terms of the Agreement.

Aries has the option during the license term, to purchase

the rights to each licensed product (on a licensed product-by-licensed product basis) in the form of an exclusive (as to the applicable

licensed product), fully paid, transferable right and license to the licensed product.

Company has not earned any revenue related to this agreement as of December 31, 2024.

November 7, 2024, the Company entered into an Out-Licensing Agreement (the “Agreement”) with MycoMedica Life Sciences, PBC,

a Delaware public benefit corporation (“MycoMedica”), pursuant to which the Company will out-license EB-002 and its EVM201

series to MycoMedica for further development and sales of the product in treatment of neuropsychiatric disorders.

MycoMedica will receive

an exclusive, global license to the formulations, drugs, method of use, and medical devices developed by Enveric to utilize the compound.

As part of the Agreement, the Company will receive a $ 20,000 upfront payment, and if certain conditions are met, will receive development

and sales milestone payments of up to $ 62 million and tiered single-digit royalties based on future sales.

MycoMedica has the option

during the license term to buyout its milestone and royalty payment obligations at a predetermined amount depending upon the stage of

product development and commercialization at the time of the buyout.

Further, MycoMedica has the right to purchase the licensed patents

at a nominal amount upon a change of control of the Company, although doing so does not relieve MycoMedica of any of its payment obligations.

During the year ended December 31, 2024, the Company received $ 20,000 from MycoMedica as a licensing fee, which is recorded as other

income in the consolidated statements of operations.

following table provides the financial liabilities measured on a recurring basis and reported at fair value on the balance sheet as of

December 31, 2024 and 2023, and indicates the fair value of the valuation inputs the Company utilized to determine such fair value of

warrant liabilities, derivative liability, and investment options:

warrant liabilities and investment options:

OF FAIR VALUE HIERARCHY OF VALUATION INPUTS ON RECURRING BASIS

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December 31, 2023

Derivative liability - May 2022

Fair value of derivative liability

December 31, 2023

December 31, 2022

Wainwright investment options

RD investment options

PIPE investment options

Fair value of investment option liability

warrant liabilities, derivative liability, and investment options are all classified as Level 3, for which there is no current market

for these securities such as the determination of fair value requires significant judgment or estimation.

Changes in fair value measurement

categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded

within other income (expense) on the consolidated statements of operations and comprehensive loss.

Company established the initial fair value of its warrant liabilities at the respective dates of issuance.

The Company used a Black Scholes

valuation model in order to determine their value.

The key inputs into the Black Scholes valuation model for the initial valuations of

the warrant liabilities are below:

OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES AND INVESTMENT OPTIONS

February 2022 Warrants

February 2022 Post-Modification Warrants (See Note 7)

February 15, 2022

July 26, 2022

Exercise price

Dividend yield

Expected volatility

Risk free interest rate

Number of warrants

Value (per share)

warrant liabilities and investment options are all classified as Level 3, for which there is no current market for these securities such

as the determination of fair value requires significant judgment or estimation.

Changes in fair value measurement categorized within

Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded within other income

(expense) on the consolidated statements of operations and comprehensive loss

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Company established the initial fair value of its derivative liability at the respective date of issuance.

The Company used a Weighted

Expected Return valuation model in order to determine their value.

The key inputs into the Weighted Expected Return valuation model for

the initial valuations of the warrant liabilities are below:

May 2022 Derivative Liability

Dividend rate

Company established the initial fair value of its investment options at the respective dates of issuance.

The Company used a Black Scholes

valuation model in order to determine their value.

The key inputs into the Black Scholes valuation model for the initial valuations of

the investment options are below:

Wainwright Options

July 26, 2022

Exercise price

Dividend yield

Expected volatility

Risk free interest rate

Number of investment options

Value (per share)

TO CONSOLIDATED FINANCIAL STATEMENTS

following table presents the changes in fair value of the warrant liabilities, derivative liability, and investment options that are

3 unchanged sentences

Fair value as of December 31, 2022

Issuance of February 2022 warrants

Change in fair value due to modification of February 2022 warrants as part of July 2022 raise

Exercise of warrants

Change in fair value

( 4,315,236 )

Fair value as of December 31, 2023

Change in fair value

Exercise of warrants

Fair value as of December 31, 2024

1 unchanged sentence

Fair value as of December 31, 2022

Issuance of May 2022 convertible preferred stock

Change in fair value

Fair value as of December 31, 2022

Change in fair value arising from redemption of Akos Series A Preferred Stock - See Note 9

Fair value of derivative liability as of December 31, 2023

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Total Investment Options

Redemption of Series A Preferred Stock

Fair value as of December 31, 2023

Issuance of July 2022 investment options

Change in fair value

( 3,472,726 )

was no activity related to the derivative liability during the year ended December 31, 2024.

Total Investment Options

Fair value as of December 31, 2022

2 unchanged sentences

Fair value of investment option liability as of December 31, 2023

Change in fair value

Fair value of investment option liability as of December 31, 2024

key inputs into the Black Scholes valuation model for the Level 3 valuations of the warrant liabilities as of December 31, 2024 are below:

2 unchanged sentences

February 2021 Warrants

February 2022 Warrants

Exercise price

Dividend yield

Expected volatility

Risk free interest rate

Number of warrants

Value (per share)

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

key inputs into the Black Scholes valuation model for the Level 3 valuations of the warrant liabilities as of December 31, 2023 are below:

January 2021 Warrants

February 2021 Warrants

February 2022 Warrants Unmodified

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Value (per share)

the date of the redemption of the of Akos Series A Preferred Stock in May 2023, the derivative liability fair value was $ 0 due to the

probability of a spin-off occurring was zero.

key inputs into the Black Scholes valuation model for the Level 3 valuations of the investment options as of December 31, 2023 are below:

Wainwright & Co., LLC Options

Exercise price

Dividend yield

Expected volatility

Risk free interest rate

Number of investment options

Value (per share)

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

COMMITMENTS AND CONTINGENCIES

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cost of the Avance Clinical contract is approximately 3,400,000 AUD, which translates to approximately $ 2,114,000 USD as of December

As of December 31, 2023, the Company has paid approximately $ 1,036,940 of the Avance Clinical contract costs and has accrued

$ 523,284 recorded as accrued liabilities and $ 239,320 as accounts payable on the accompanying consolidated balance sheet.

ended December 31, 2023, the Company has expensed $ 1,751,444 in research and development expenses within the accompanying consolidated

statement of operations.

and Clinical Supply Agreement

February 22, 2021, the Company entered into a Development and Clinical Supply Agreement (the “PureForm Agreement”) with PureForm

(“PureForm”), pursuant to which PureForm will be the exclusive provider of synthetic cannabidiol (“API”)

for the Company’s development plans for cancer treatment and supportive care.

Under the terms of the PureForm Agreement, PureForm

has granted the Company the exclusive right to purchase API and related product for cancer treatment and supportive care during the term

of the Agreement (contingent upon an initial minimum order of 1 kilogram during the first thirty (30) days from the effective date) and

has agreed to manufacture, package and test the API and related product in accordance with specifications established by the parties.

All inventions that are developed jointly by the parties in the course of performing activities under the PureForm Agreement will be

owned jointly by the parties in accordance with applicable law;

however, if the Company funds additional research and development efforts

by PureForm, the parties may enter into a further agreement whereby PureForm would assign any resulting inventions or technical information

to the Company.

initial term of the PureForm Agreement is three (3) years commencing on the effective date of the PureForm Agreement, subject to extension

by mutual agreement of the parties.

The Company has met the minimum purchase requirement of 1 kilogram during the first thirty days of

the PureForm Agreement’s effectiveness.

The Company did not pursue an extension of the PureForm Agreement beyond the initial term

and the agreement terminated in 2024.

The Company has terminated the agreement as of December 31, 2024.

Total project costs were 3,300,000 AUD and the Company will

not incur any future costs associated with the agreement.

Accordingly, the Company has $ 0 recorded as prepaid assets within prepaid and

other current assets, accrued $ 0 recorded as accrued liabilities and $ 0 as accounts payable on the accompanying consolidated balance

For the years ended December 31, 2024 and 2023, the Company has expensed $ 495,465 and $ 1,751,444 , respectively, in research and

development expenses within the accompanying consolidated statement of operations.

As of December 31, 2024, the project is completed.

to Australian tax law, the Company is allowed an R&D tax credit that reduces a company’s tax bill in Australia for expenses

incurred in R&D subject to certain requirements.

The Company’s Australian subsidiary submits R&D tax credit requests annually

for research and development expenses incurred.

At December 31, 2024 and 2023, the Company had a research and development tax credit

receivable of $ 0 and $ 145,349 , respectively, for R&D expenses incurred in Australia, included in prepaid and other current assets

within the accompanying consolidated statement of operations.

The Company received the amount due in relation to the research and development

tax credit of $ 290,447 during the year ended December 31, 2024.

agreement with Prof.

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the date of the Vogel-Nathan Purchase Agreement.

The Vogel-Nathan Purchase Agreement includes a commitment to pay a one-time milestone

totaling $ 200,000 upon the issuance of a utility patent in the United States or by the European Patent Office, as defined in the agreement.

The Company has accrued such amount as of December 31, 2021, as a result of the milestone criteria being achieved.

Payment was made during

January 2022.

In addition, a milestone payment totaling $ 300,000 is due upon initiation of a Phase II(b) study.

Research activities related

to the relevant patents are still in pre-clinical stage, and accordingly, this milestone has not been achieved.

The Vogel-Nathan Purchase

Agreement contains a commitment for payment of royalties equaling 2 % of the first $ 20 million in net sales derived from the commercialization

of products utilizing the relevant patent.

As these products are still in the preclinical phase of development, no royalties have been

The patent portfolio acquired and developed under the Vogel-Nathan Purchase Agreement

was sold to undisclosed buyers for an amount not material to these financials in the first quarter of 2024.

No additional financial or

other obligations exist regarding the Vogel-Nathan Purchase Agreement.

Consulting and Vendor Agreements

Company has entered into a number of agreements and work orders for future consulting, clinical trial support, and testing services,

with terms ranging between 1 and 18 months.

with terms ranging between one and 12 months.

These agreements, in aggregate, commit the Company to approximately $ 0.3 million in future

cash payments.

in Force/Restructuring

May 2023, the Company entered into a cost reduction plan, including a reduction in force (“RIF”) of approximately 35 % of

its full-time employees to streamline its operations and conserve cash resources.

Additionally, contracts with seven consultants that

were focused on the Akos cannabinoid spin-out were terminated.

The plan included a focus on progressing the Company’s existing

non-cannabinoid pipeline while reducing the rate of spend and managing cash flow.

In June 2023, the Company completed the reduction in

force, with such severance expenses recorded in general and administrative accounts.

June 2023, the Company entered into a separation agreement with Avani Kanubaddi, the Company’s President and Chief Operating Officer

(the “Kanubaddi Separation Agreement”).

In accordance with the Kanubaddi Separation Agreement, Mr.

Kanubaddi received salary

and benefits that is paid out in twelve monthly installments beginning in July 2023, was eligible for his 2023 performance bonus, which

was not achieved, and any outstanding restricted stock units retained their vesting conditions.

following table summarizes the Reduction in Force/Restructuring activity and ending balance at December 31, 2024 and 2023 for the remaining

severance payments included in accrued expenses in the consolidated balance sheet:

SCHEDULE OF REDUCTION IN FORCE/RESTRUCTURING ACTIVITY

Accrued Restructuring Costs

January 1, 2023 Beginning balance

Restructuring costs incurred

Restructuring costs paid

Restructuring costs reversed

December 31, 2023 ending balance

Restructuring costs paid

December 31, 2024 ending balance

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

August 1, 2021, MagicMed entered into a lease agreement (the “LSIH Lease”) with the University of Calgary for the use and

occupation of lab and office space at the University of Calgary’s Life Science Innovation Hub building located in Calgary, Alberta,

Canada (the “LSIH Facility”).

The lease expired in July 2023, and was extended on a month-to-month basis through December

Accordingly, no operating lease liability or right-of-use asset is recorded as of December 31, 2023.

The Company terminated

this lease effective in March 2024.

expense is recorded on the straight-line basis.

Rent expense under the LSIH Lease for the years ended December 31, 2023 and 2022 was

$ 114,241 and $ 120,667 , respectively.

Rent expense is recorded in research and development costs on the consolidated statements of operations

and comprehensive loss.

weighted-average remaining lease term and the weighted-average discount rate of the lease was as follows:

SCHEDULE OF WEIGHTED

AVERAGE REMAINING LEASE TERM

December 31, 2022

Remaining lease term (years)

Operating leases

Discount rate

Operating leases

TO CONSOLIDATED FINANCIAL STATEMENTS

Company’s U.S.

8 unchanged sentences

$ ( 17,262,819 )

the years ended December 31, 2023 and 2022, the Company recorded income tax expense of $ 28,913 and an income tax benefit of $ 1,486,060 ,

respectively.

The income tax benefit (expense) is as follows:

the years ended December 31, 2024 and 2023, the Company recorded income tax expense of $ 8,930 and $ 28,913 , respectively.

The income tax

expense is as follows:

OF INCOME TAX EXPENSE BENEFITS

1 unchanged sentence

deferred income tax (expense) benefit

Total income tax (expense) benefit

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Total income tax expense

Company’s deferred tax assets and deferred tax liabilities consist of the following:

12 unchanged sentences

Net operating loss tax carryforwards

Tax Cuts and Jobs Act of 2017 (the “Act”) limits the net operating loss deduction to 80% of taxable income for losses

arising in tax years beginning after December 31, 2017.

As of December 31, 2023, the Company had federal net operating loss

carryforwards and state net operating loss carryforwards of $ 24,268,692

and $ 11,220,065 ,

respectively, both of which can be carried forward indefinitely and Canadian net operating loss carryforwards of $ 17,672,420 ,

which will begin to expire in 2040.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

Tax Cuts and Jobs Act of 2017 (the “Act”) limits the net operating loss deduction to 80% of taxable income for losses arising

in tax years beginning after December 31, 2017.

As of December 31, 2024, the Company had federal net operating loss carryforwards of $ 30,086,333 which can be carried forward indefinitely, state net operating losses carryforwards

of $ 14,467,439 , of which $ 6,407,050 can be carried forward indefinitely and remainder can be carried 20 years and Canadian net operating

loss carryforwards of $ 17,543,639 , of which $ 16,215,951 will begin to expire in 2040 and the remainder is carried forward indefinitely.

Company’s effective tax rate varied from the statutory rate as follows:

18 unchanged sentences

statute of limitations.

As of December 31, 2023, the Company has not filed tax returns for the fiscal year 2023 and Canadian corporate

tax returns for fiscal year 2022.

utilization of the Company’s net operating losses may be subject to a substantial limitation in the event of any significant future

2 unchanged sentences

in the expiration of the net operating loss carryforwards before their utilization.

BIOSCIENCES, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

We have not conducted any studies to determine annual

limitations, if any, that could result from such changes in ownership.

in 2022, the Tax Cuts and Jobs Act of 2017 (“TCJA”) eliminated the option to deduct research and development expenditures

7 unchanged sentences

impact of these tax law changes on the current and future periods.

Reduction Act

August 16, 2022, President Joe Biden signed the Inflation Reduction Act of 2022 (the “Act”) into law.

The Act includes a

new 15% corporate minimum tax and a 1% excise tax on the value of corporate stock repurchases, net of new share issuances, after December

These provisions did not have a material impact on the Company’s consolidated financial position as of December 31, 2023.

SUBSEQUENT EVENTS

February 29, 2024, the Company issued all 704,000 shares of common stock of the 704,000 shares of Existing Warrants and Investment Options

exercised that were held in abeyance due to the beneficial ownership limitation provisions.

February 29, 2024, one investor exercised the Inducement Warrants to purchase 1,954,000 shares of common stock for cash proceeds of approximately

$ 2.7 million.

March 8, 2024, the Company entered into a series of common stock purchase agreements for the issuance in a registered direct offering

shares of the Company’s common stock, par

per share to the Holders of the Inducement Warrants.

The issuance was made in exchange for the permanent and irrevocable waiver of the variable rate transaction limitation solely with respect

to the entry into and/or issuance of shares of common stock in an at the market offering contained in the Inducement Letters.

to December 31, 2023, the Company sold an aggregate of 1,668,000 shares of common stock for aggregate gross proceeds of $ 2,392,502 and

net proceeds of $ 2,320,707 under the Distribution Agreement with Canaccord.”

January 30, 2025, the Company commenced a best efforts public offering (the “Offering”) of an aggregate of (i) 1,229,330

shares (the “Shares”) of Common Stock of the Company, (ii) 437,336 pre-funded warrants (the “Pre-Funded Warrants”)

to purchase 437,336 shares of Common Stock (the “Pre-Funded Warrant Shares”), (iii) 1,666,666 Series A warrants (the “Series

A Warrants”) to purchase 1,666,666 shares of Common Stock (the “Series A Warrant Shares”), and (iv) 1,666,666 Series

B warrants (the “Series B Warrants,” and together with the Series A Warrants, the “Warrants”) to purchase 1,666,666

shares of Common Stock (the “Series B Warrant Shares”).

Each Share or Pre-Funded Warrant was sold together with one Series

A Warrant to purchase one share of Common Stock and one Series B Warrant to purchase one share of Common Stock.

The offering price for

each Share and accompanying Warrants was $ 3.00 , and the offering price for each Pre-Funded Warrant and accompanying Warrants was $ 2.9999 .

The Pre-Funded Warrants have an exercise price of $ 0.0001 per share, are exercisable immediately and will expire when exercised in full.

Each Warrant has an exercise price of $ 3.00 per share and will be exercisable immediately upon issuance (“Initial Exercise Date”).

The Series A Warrants expire on the five-year anniversary of the Initial Exercise Date.

The Series B Warrants expire on the 18-month

anniversary of the Initial Exercise Date.

Offering closed on February 3, 2025.

The net proceeds of the Offering, after deducting the fees and expenses of the Placement Agent (as

defined below), described in more detail below, and other offering expenses payable by the Company, but excluding the net proceeds, if

any, from the exercise of the Warrants, is approximately $ 4.2 million.

The Company intends to use the net proceeds from the Offering

for working capital, EB-003 development, and general corporate purposes.

BIOSCIENCES, INC.

AND SUBSIDIARIES

TO CONSOLIDATED FINANCIAL STATEMENTS

connection with the Offering, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with a

certain institutional investor.

Pursuant to the Purchase Agreement, the Company agreed not to issue, enter into any agreement to issue

or announce the issuance or proposed issuance of any shares of Common Stock or any securities convertible into or exercisable or exchangeable

for shares of Common Stock or file any registration statement or prospectus, or any amendment or supplement thereto for 60 days after

the closing date of the Offering, subject to certain exceptions.

In addition, the Company has agreed not to effect or enter into an agreement

to effect any issuance of Common Stock or any securities convertible into or exercisable or exchangeable for shares of Common Stock involving

a variable rate transaction (as defined in the Purchase Agreement) until the one-year anniversary of the closing date of the Offering,

subject to an exception.

holder will not have the right to exercise any portion of the Warrants or Pre-Funded Warrants if the holder (together with its affiliates)

would beneficially own in excess of 4.99% or 9.99%, as applicable, of the number of shares of Common Stock outstanding immediately after

giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrants or the Pre-Funded

Warrants, respectively.

to an engagement agreement, as amended, (the “Engagement Agreement”) with H.C.

Wainwright & Co., LLC (the “Placement

Agent”), the Company agreed to pay the Placement Agent in connection with the Offering (i) a cash fee equal to 7.0% of the aggregate

gross proceeds received in the Offering, (ii) a management fee equal to 1.0% of the aggregate gross proceeds received in the Offering,

(iii) a non-accountable expense allowance of $ 25,000 , (iv) reimbursement of up to $ 100,000 for legal fees and expenses and other out

of pocket expenses and (v) up to $ 15,950 for the clearing expenses.

pursuant to the Engagement Agreement, the Company, in connection with the Offering, agreed to issue to the Placement Agent or its designees

warrants (the “Placement Agent Warrants”) to purchase up to an aggregate of 116,666 shares of Common Stock (the “Placement

Agent Warrant Shares”) (which represents 7.0 % of the Shares and Pre-Funded Warrants sold in the Offering).

The Placement Agent

Warrants have an exercise price of $ 3.75 per share (which represents 125 % of the public offering price per Share and accompanying Warrants),

expire on January 30, 2030, and are exercisable following the Initial Exercise Date.

February 2025, a total of 437,336 shares of Common Stock have been issued due to exercises of the Pre-Funded Warrants and 25,000 shares

of Common Stock have been issued due to exercises of Series B Warrants.

February 3, 2025, Akos entered into two licensing agreements with Restoration Biologics LLC (“Restoration Biologics”), a

biotechnology company focused on the treatment of joint disease.

The companies have executed two licenses for Akos’ cannabinoid-COX-2

conjugate compounds, for pharmaceutical and potential non-pharmaceutical applications.

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 9A. Controls and Procedures