What changed in this filing

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Item 1. Financial Statements

2021-05-13 compared with 2021-02-12 · 520 added, 402 removed, 492 unchanged (65% of the section changed)

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Consolidated Balance Sheets

March 31, 2021

June 30, 2020

Current assets:

and cash equivalents

Cash and cash equivalents

Deferred charges

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Investment in affiliate

Other non-current assets

LIABILITIES AND SHAREHOLDERS’

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Current liabilities:

Accounts payable

and accrued expenses

Accounts payable and accrued expenses

Related party payables

notes payable

Convertible notes payable

Total current liabilities

Employee benefit

Employee benefit liabilities

Total liabilities

Commitments and

contingencies - Note 10

Commitments and contingencies - Note 10

Shareholders’

equity (deficit):

Preferred stock,

$0.01 par value, 10,000,000 shares authorized, 3,000,000 and 2,370,891 shares issued and outstanding at December 31, 2020

and June 30, 2020, respectively

Common stock, $0.01

par value, 100,000,000 shares authorized, 10,422,527 and 8,630,000 shares issued and outstanding at December 31, 2020 and

June 30, 2020, respectively

Additional paid-in

Preferred stock, $0.01 par value, 10,000,000 shares authorized, 3,000,000 and 2,370,891 shares issued and outstanding at March 31, 2021 and June 30, 2020, respectively

Common stock, $0.01 par value, 100,000,000 shares authorized, 11,881,322 and 8,630,000 shares issued and outstanding at March 31, 2021 and June 30, 2020, respectively

Additional paid-in capital

Accumulated deficit

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(15,832,517 )

other comprehensive loss

Total consolidated

group equity (deficit)

Non-controlling

shareholders’

Accumulated other comprehensive loss

Total consolidated group equity (deficit)

Non-controlling interests

Total shareholders’

equity (deficit)

LIABILITIES AND SHAREHOLDERS’

TOTAL LIABILITIES AND SHAREHOLDERS’

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

Consolidated Statements of Operations and Other Comprehensive Loss

Months Ended December 31,

Months Ended March 31,

Other income:

support income

revenues and other income

Operating expenses:

General and administrative

Development and

regulatory approval expenses

and administrative expenses

and regulatory approval expenses

and capital raising expenses

operating expenses

Loss from operations

from operations

Other (expense) income:

Interest expense

Loss from unconsolidated

equity method investment

Realized foreign

exchange loss

from unconsolidated equity method investment

foreign exchange gain/(loss)

other expense

Loss before income taxes

Loss before income

Income tax (expense)/benefit

Total income tax

(expense)/benefit

loss attributable to noncontrolling interest

income tax (expense)/benefit

(loss) income attributable to non-controlling interest

loss attributable to GBS, Inc.

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$ (2,706,760 )

$ (2,594,168 )

Other comprehensive

currency translation gain/(loss) attributable to non-controlling interest

currency translation gain/(loss) attributable to GBS, Inc.

other comprehensive income

currency translation gain (loss)

Total other comprehensive

Comprehensive

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$ (2,734,889 )

$ (2,746,913 )

Net loss per share, basic and diluted

Weighted average shares outstanding, basic and diluted

Net loss per share,

basic and diluted

Weighted average number of shares outstanding,

basic and diluted

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

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stockholders’

Balance, June 30, 2020

June 30, 2020

$ (15,832,517 )

$ (5,214,828 )

Issuance of convertible

preferred shares

of convertible preferred shares

currency translation loss

Balance, September

September 30, 2020

(16,905,027 )

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A and B warrants acquired

Foreign currency translation

Balance, December

currency translation loss

December 31, 2020

$ (18,888,991 )

A warrants exercised to purchase common shares

B warrants exercised to purchase common shares

currency translation loss

March 31, 2021

$ (22,016,804 )

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

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stockholders’

Balance, June 30, 2019

June 30, 2019

(12,668,741 )

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of noncontrolling interest

Balance, June 30, 2019

June 30, 2019

(12,668,741 )

Issuance of convertible

preferred shares

of convertible preferred shares

costs for common and preferred shares

currency translation loss

Balance, September

September 30, 2019

(13,426,591 )

currency translation loss

Balance, December

December 31, 2019

$ (15,262,909 )

$ (5,874,208 )

currency translation loss

March 31, 2020

$ (15,375,501 )

$ (5,884,394 )

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

Consolidated Statements of Cash Flows

Months Ended December 31,

Cash flows from operating

Nine Months Ended March 31,

Cash flows from operating activities:

$ (6,209,971 )

$ (2,728,970 )

Adjustments to reconcile

net loss to net cash used in operating activities:

Loss on foreign

currency translation

Loss on investment

Amortization of

debt discount and issuance costs

Contingent beneficial

conversion feature on convertible notes

Changes in operating

assets and liabilities:

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

Loss on foreign currency translations (net)

Loss on investment in affiliate

Amortization of debt discount and issuance costs

Contingent beneficial conversion feature on convertible notes

Changes in operating assets and liabilities:

Other receivables

Other current assets

Accounts payable

Other non-current assets

Accounts payable

- related party

long-term liabilities

cash used in operating activities

flows from investing activities:

cash used in investing activities

Cash flows from financing

Proceeds from issuance

Proceeds from warrant

holders for common shares

Proceeds from issuance

of preferred stock

Proceeds from initial

public offering

Payment of equity

issuance costs

Net cash provided

by financing activities

Increase in cash

and cash equivalents

and cash equivalents, beginning of period

and cash equivalents, end of period

Non-cash investing

and financing activities

Reclassification

of deferred charges to additional paid in capital upon completion of initial public offering

of notes to common shares at initial public offering

Conversion of preferred

shares into common shares

Supplemental disclosure

of cash flow information:

paid for income taxes

paid for interest

Accounts payable - related party

Other long-term liabilities

Net cash used in operating activities

Cash flows from investing activities:

Net cash used in investing activities

Cash flows from financing activities:

Proceeds from issuance of warrants

Proceeds from warrant holders for common shares

Proceeds from issuance of preferred stock

Proceeds from initial public offering

Payment of equity issuance costs

Net cash provided by financing activities

of foreign exchange rates on cash and cash equivalents

Increase in cash and cash equivalents

Cash and cash equivalents, beginning of period

Cash and cash equivalents, end of period

Non-cash investing and financing activities

Reclassification of deferred charges to additional paid in capital upon completion of initial public offering

Conversion of notes to common shares at initial public offering

Conversion of preferred shares into common shares

Supplemental disclosure of cash flow information:

Cash paid for income taxes

Cash paid for interest

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

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and its wholly owned subsidiary, GBS Operations Inc.

are formed under the laws of the state of Delaware, and were formed

on December 5, 2016.

Glucose Biosensor Systems (Greater China) Pty Ltd (“GBSPL”) was formed on August 4, 2016 under

the laws of New South Wales, Australia and was renamed to GBS (APAC) Pty Ltd on October 14, 2020.

Glucose Biosensor Systems (Japan)

Pty Ltd and Glucose Biosensor Systems (APAC) Pty Ltd were formed under the laws of New South Wales, Australia on February 22,

2017 and February 23, 2017 respectively.

were formed on December 5, 2016 under the laws of the state of Delaware.

Glucose Biosensor Systems (Greater China) Pty Ltd (“GBSPL”) was formed on August 4, 2016 under the laws of New South

Wales, Australia and was renamed to GBS (APAC) Pty Ltd on October 14, 2020.

Glucose Biosensor Systems (Japan) Pty Ltd and GBS

(APAC) Pty Ltd were formed under the laws of New South Wales, Australia on February 22, 2017 and February 23, 2017 respectively.

These companies (collectively, the “Company”

or “Group”) were

formed to provide a non-invasive, pain free innovation to make it easier for people to manage diabetes using the Company’s

Saliva Glucose Biosensor (“SGB”

and, together with the software app that interfaces the SGB with the Company’s

digital information system, the “SGT”).

Inc, has 54.4% of its common stock owned of Life Science Biosensor Diagnostics Pty Ltd (“LSBD”),

or “Group”) were formed to provide a non-invasive, pain free

innovation to make it easier for people to manage diabetes using the Company’s Saliva Glucose Biosensor (“SGB”

and, together with the software app that interfaces the SGB with the Company’s digital information system, the “SGT”).

is a 48.7% owned (by voting rights) affiliate of Life Science Biosensor Diagnostics Pty Ltd (“LSBD”),

an Australian company that owns the worldwide intellectual property rights to the biosensor platform from University of Newcastle,

LBSD has licensed to the Company that technology to introduce and launch the platform in the Asia-Pacific Region (“APAC”).

We will commence this process with the SGT.

May 29, 2020, a research agreement was executed between LSBD and the Wyss Institute for Biologically Inspired Engineering

at Harvard University (Wyss).

The Company is not a legal party to the agreement but is expecting to derive a benefit through the

Technology Transfer Agreement executed with LSBD and the Company on June 23, 2020, further details which are provided below.

Company has transferred biosensors (research materials) to the Wyss Institute where its research and development scientists have

commenced a pilot research program.

LSBD has licensed to the Company that technology to introduce and launch the platform in the Asia-Pacific Region

(“APAC”).

The Company will commence this process with the SGT.

May 29, 2020 a research agreement was executed between LSBD and the Wyss Institute for Biologically Inspired Engineering at Harvard

University (Wyss).

The Company is not a legal party to the agreement but is expecting to derive a benefit through the Technology

Transfer Agreement executed with LSBD and the Company on June 23, 2020, further details which are provided below.

has transferred biosensors (research materials) to the Wyss Institute where its research and development scientists have commenced

a pilot research program.

Since the biosensor architecture is complete and given the pre-existing plans to develop immunology

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June 23, 2020, the Company entered into a Technology Transfer Agreement global license with LSBD.

The significant terms of the

license agreement are:

The significant terms

of the license agreement are:

Company has the exclusive worldwide rights to a biosensor strip for antibodies against SARS-CoV-2 and associated application

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This serves as the minimum royalty and falls to 3% at the expiry of the relevant patent(s)

additional year, the sales upon which the minimum royalty is calculated on is increased by the mutually agreed Expected Market

Growth rate plus an Additional Growth Percentage rate up to 7% annually.

The Additional Growth Percentage Rate is calculated

and applied for 10 years

Each additional year, the sales upon which the minimum

royalty is calculated on is increased by the mutually agreed Expected Market Growth rate plus an Additional Growth Percentage

rate up to 7% annually.

The Additional Growth Percentage Rate is calculated and applied for 10 years

the event of a dispute, in relation to the expected market growth or additional percentage, the agreement provides for a dispute

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issued in the offering generated $17,732,448 in net proceeds, which amount is net of $1,714,001 in underwriters’

and commissions, $2,153,564 in offering costs (including deferred equity offering cost of $1,863,612).

Offering costs

include underwriters’

warrants to acquire up to 63,529 shares with an exercise price of $18.70 per share, exercisable until

the fifth anniversary of the issuance date.

The Company also issued to the underwriter an option, exercisable one or more times

in whole or in part, to purchase up to 190,588 additional shares of common stock and/or Series A Warrants to purchase up to an

aggregate of 190,588 shares of common stock and/or Series B Warrants to purchase up to an aggregate of 190,588 shares of common

stock, in any combinations thereof, from us at the public offering price per security, less the underwriting discounts and commissions,

for 45 days after the date of the IPO to cover over-allotments, if any (the “Over-Allotment Option”).

and commissions, and $2,153,564 in offering costs.

Offering costs include underwriters’

warrants to acquire up to 63,529

shares with an exercise price of $18.70 per share, exercisable until the fifth anniversary of the issuance date.

The Company also

issued to the underwriter an option, exercisable one or more times in whole or in part.

If, and to the extent, the Over Allotment

Option was exercised, the underwriter may purchase up to 190,588 additional shares of common stock and/or Series A Warrants

to purchase up to an aggregate of 190,588 shares of common stock and/or Series B Warrants to purchase up to an aggregate of 190,588

shares of common stock, in any combinations thereof, from us at the public offering price per security, less the underwriting

discounts and commissions, for 45 days after the date of the IPO to cover over-allotments, if any (the “Over-Allotment Option”).

the closing of the IPO, all shares of preferred stock then outstanding were automatically converted into 2,810,190 shares of common

stock, and all convertible notes then outstanding were automatically converted into 710,548 shares of common stock.

preferred shareholders were issued warrants following the Company’s completed IPO, that allows the holder to acquire 2,736,675

preferred shareholders were issued warrants following the Company’s completed IPO, that allow the holder to acquire

2,736,675 shares of common stock at the IPO price during year two through to year three following the completion of the IPO.

date, the shareholder must hold, for each warrant to be exercised, the underlying common share to exercise the warrant.

are not transferable and apply to the number of shares that were subscribed for.

exercise date, the shareholder must hold, for each warrant to be exercised, the underlying common share to exercise the warrant.

The warrants are not transferable and apply to the number of shares that were subscribed for.

Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 205-40,

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in its medical device portfolio.

Company incurred a net loss of $3,067,304 for the six months ended December 31, 2020 (Net loss $2,617,863 for the six months ended

December 31, 2019).

At December 31, 2020, the Company has shareholders’

equity of $18,782,015, working capital of $18,799,962,

and an accumulated deficit of $(18,888,991).

January 30, 2020, the International Health Regulations Emergency Committee of the World Health Organization (WHO) declared the

novel coronavirus disease 2019 (“COVID-19”) outbreak a public health emergency of international concern and on March

12, 2020 the WHO announced the outbreak was a pandemic.

The COVID-19 pandemic is having a negative impact on global markets and

business activity, which has had a limited impact on our core business operations.

However, due to the nature of our platform

technology we are able to quickly adapt to this rapidly evolving environment.

As part of the immunology modality of the biosensor

platform, the parent company, Life Science Biosensor Diagnostics Pty Ltd (LSBD) executed an agreement on May 29, 2020 with the

Wyss Institute for Biologically Inspired Engineering at Harvard University (Wyss) to use the biosensor platform to develop a COVID-19

rapid diagnostic test.

The Company has the rights to the technology from this agreement under a Technology Transfer Agreement

global license with LSBD entered into on June 23, 2020.

Company incurred a net loss of $6,209,971 for the nine months ended March 31, 2021 (Net loss $2,728,970 for the nine months

ended March 31, 2020).

As at March 31, 2021, the Company has shareholders’

equity of $15,875,416, working

capital of $15,026,877, and an accumulated deficit of $(22,016,804).

January 30, 2020, the International Health Regulations Emergency Committee of the World Health Organization (the “WHO”)

declared the novel coronavirus disease 2019 (“COVID-19”) outbreak a public health emergency of international concern

and on March 12, 2020 the WHO announced the outbreak was a pandemic.

The COVID-19 pandemic is having a negative impact on global

markets and business activity, which has had a limited impact on our core business operations.

However, due to the nature of our

platform technology we are able to quickly adapt to this rapidly evolving environment.

As part of the immunology modality of the

biosensor platform, LSBD executed an agreement on May 29, 2020 with the Wyss Institute for Biologically Inspired Engineering

at Harvard University to use the biosensor platform to develop a COVID-19 rapid diagnostic test.

The Company has the rights

to the technology from this agreement under a Technology Transfer Agreement global license with LSBD entered into on June 23,

is the global licensee and intends to commercialize COVID-19 diagnostic tests across the US, Europe, APAC and the rest of

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approvals to market such products.

Group’s consolidated financial statements have been prepared on a going concern basis which contemplates the realization

Company’s consolidated financial statements have been prepared on a going concern basis which contemplates the realization

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

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do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and

classification of liabilities should the Group be unable to continue as a going concern.

classification of liabilities should the Company be unable to continue as a going concern.

a result of the Company’s initial public offering (see Note 1), the Company believes it has sufficient working capital to

finance its operations for the next twelve months as such these financial statements are prepared on the going concern basis.

finance its operations for the next twelve months as such these consolidated financial statements are prepared on the going

concern basis.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

of presentation

unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles

generally accepted in the United States (“U.S.

GAAP”) and pursuant to the requirements for reporting on Form 10-Q

and Article 10 of Regulation S-X and, therefore, omit or condense certain footnotes and other information normally included in

financial statements prepared in accordance with U.S.

In the opinion of management, the condensed consolidated financial

statements reflect all adjustments and reclassifications that are necessary for the fair presentation of financial results as

of and for the periods presented.

unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting

principles generally accepted in the United States (“

GAAP”) and pursuant to the requirements for reporting

on Form 10-Q and Article 10 of Regulation S-X and, therefore, omit or condense certain footnotes and other information normally

included in financial statements prepared in accordance with U.S.

In the opinion of management, the condensed consolidated

financial statements reflect all adjustments and reclassifications that are necessary for the fair presentation of financial results

as of and for the periods presented.

The results of operations for an interim period may not give a true indication of the results

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Securities and Exchange Commission (the “SEC”).

There have not been any significant changes to the Company’s significant accounting policies during the six months ended

December 31, 2020.

There have not been any significant changes to the Company’s significant accounting policies during the nine months ended

March 31, 2021.

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

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Management concluded that this reclassification was not meaningful to the Company’s

financial position for the prior year, and as such, this change was recorded in the consolidated balance sheet and statement of

shareholder’s equity in the first quarter of the comparative period (FY 2020) as an out-of-period adjustment.

financial position for the prior year, and as such, this change was recorded in the consolidated balance sheets and statements

of shareholder’s equity in the first quarter of the comparative period (FY 2020) as an out-of-period adjustment.

the three months ended March 31, 2020, amounts presented in the income statement reflect the difference between the nine months

ended March 31, 2020 and the previously reported six months ended December 31, 2019 (Form 10Q for the quarter ended December 31,

These quarterly balances was mainly impacted by a reclassification of $268,457 in overhead reimbursements that has

been reclassified from other income to general and administrative expenses for comparative reasons.

The Company currently

does not generate any revenue.

The foreign currency translation gain was also adjusted by $165,230 to total operating expenses

for the same reason.

from contracts with customers is recognized when, or as, the Company satisfies its performance obligations by delivering the promised

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obtains control of that good or service deliverable.

The Company currently does not generate any revenue.

currency translation

and liabilities of foreign subsidiaries are translated from local (functional) currency to presentation currency (U.S.

at the rate of exchange in effect on the consolidated balance sheets date;

and liabilities of foreign subsidiaries are translated from local (functional) currency to reporting currency (U.S.

the rate of exchange in effect on the consolidated balance sheets date;

income and expenses are translated at the average rate

of exchange prevailing during the year.

The functional currency of GBS Inc is the United States dollar.

Foreign currency movements

resulted in a gain/(loss) of $33,856 and ($16,712) for the three and six months ended December 31, 2020, respectively ($133,286)

and ($129,050) for the three and six months ended December 31, 2019, respectively.

The functional currency of GBS Inc.

is the United States dollar.

Foreign currency

movements resulted in a gain/(loss) of ($262,032) and ($278,744) for the three and nine months ended March 31, 2021, respectively

and $100,921 and ($28,129) for the three and nine months ended March 31, 2020, respectively.

accordance with the provisions of Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”)

740, Income Taxes, tax positions initially need to be recognized in the consolidated financial statements when it is more likely

than not that the positions will be sustained upon examination by taxing authorities.

740, Income Taxes , tax positions initially need to be recognized in the consolidated financial statements when it is more

likely than not that the positions will be sustained upon examination by taxing authorities.

It also provides guidance for de-recognition,

classification, interest and penalties, accounting in interim periods, disclosure, and transition.

of December 31, 2020, the Group had no uncertain tax positions that qualified for either recognition or disclosure in the consolidated

financial statements.

Additionally, the Group had no interest and penalties related to income taxes.

Group accounts for current and deferred income taxes and, when appropriate, deferred tax assets and liabilities are recorded with

respect to temporary differences in the accounting treatment of items for financial reporting purposes and for income tax purposes.

Where, based on the weight of all available evidence, it is more likely than not that some amount of the recorded deferred tax

assets will not be realized, a valuation allowance is established for that amount that, in management’s judgment, is sufficient

to reduce the deferred tax asset to an amount that is more likely than not to be realized.

of March 31, 2021, the Company had no uncertain tax positions that qualified for either recognition or disclosure in the

consolidated financial statements.

Additionally, the Company had no interest and penalties related to income taxes.

Company accounts for current and deferred income taxes and, when appropriate, deferred tax assets and liabilities are recorded

with respect to temporary differences in the accounting treatment of items for financial reporting purposes and for income tax

Where, based on the weight of all available evidence, it is more likely than not that some amount of the recorded deferred

tax assets will not be realized, a valuation allowance is established for that amount that, in management’s judgment, is

sufficient to reduce the deferred tax asset to an amount that is more likely than not to be realized.

issuance cost

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recorded as part of interest expense of the consolidated statements of operations.

the first quarter of the FY ended 30 June 2020, the Company had purchased the license right procurement assets from Life Science

Biosensor Diagnostics Pty Ltd for an amount of $976,308 (June 30, 2019:

$ nil) in relation to the development and approval process

for the Glucose Biosensor Technology.

The Company recorded the license at the historical carrying value in the books of LSBD which

was $ nil and recorded the amount paid as a deemed dividend.

The Company has agreed to pay royalties of sales & milestones

payments as defined.

the first quarter of the fiscal year ended June 30 2020, the Company purchased the license right procurement assets from

LSBD for an amount of $976,308 (June 30, 2019:

$ nil) in relation to the development and approval process for the Glucose Biosensor Technology.

The Company recorded the license at the historical carrying value in the books of LSBD which was $ nil and recorded the amount paid as

a deemed dividend.

The Company has agreed to pay royalties of sales & milestones payments as defined.

July 3, 2019, the Company entered into an amended and restated license agreement.

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covered by the agreement which is currently until 2033.

No royalties have been incurred through to December 31, 2020 (December

No royalties have been incurred through to March 31, 2021 (March 31, 2020:

March 31, 2021, GBS entered into an agreement with LSBD to provide GBS an option to acquire an exclusive license to use LSBD’s

intellectual property in the Saliva Glucose Biosensor in North America (the “Option Agreement”).

The Option Agreement

has a term of two years and the exercise price for the option is $5 million.

The fee of $0.5 million incurred for the option has been

recognized as an expense and included within ‘Development and regulatory approval expenses in the consolidated statements of operations.

and development costs

and development costs are expensed as incurred.

the quarter ended March 31, 2021, the Company contributed a total of $2,600,000 towards budgeted development and commercialization

costs to be incurred by BiosensX (North America) Inc.

in which the Company has a 50% interest.

This represents the

Company’s contribution towards budgeted development and commercialization costs included in total costs budgeted

in the Form S-1.

This funding relates to the development and preparation for submission of the Saliva Glucose Biosensor

connected with regulatory approval for the U.S market by the U.S Food & Drug Administration.

This amount is recognized as

a prepayment and will be expensed as incurred over an estimated 18 month period in which the costs are expected to be

loss per share attributable to common shareholders (“EPS”)

Company calculates earnings per share attributable to common shareholders in accordance with ASC Topic 260, “Earning Per

Share.”

Basic net income (loss) per share attributable to common shareholders is calculated by dividing net income (loss)

attributable to common shareholders by the weighted-average number of common shares outstanding during the period.

income (loss) per common share is calculated by dividing net income (loss) attributable to common shareholders by weighted-average

common shares outstanding during the period plus potentially dilutive common shares, such as share warrants.

Company calculates earnings per share attributable to common shareholders in accordance with ASC Topic 260, Earning Per Share .

Basic net income (loss) per share attributable to common shareholders is calculated by dividing net income (loss) attributable

to common shareholders by the weighted-average number of common shares outstanding during the period.

Diluted net income (loss)

per common share is calculated by dividing net income (loss) attributable to common shareholders by weighted-average common shares

outstanding during the period plus potentially dilutive common shares, such as share warrants.

dilutive common shares shall be calculated in accordance with the treasury share method, which assumes that proceeds from the

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15, 2021, and interim period within fiscal years beginning after December 15, 2022 as amended by ASU 2020-05 with early adoption

The Company has not early adopted the standard.

The Company has not early adopted the standard and continues to evaluate the impact.

December 2019, the FASB issued ASU No.

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Early adoption is permitted.

The Company has not early adopted the standard.

The Company has not early adopted the standard and continues to evaluate the impact.

Concentration

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attempts to limit the amount of credit exposure with any one institution.

Company has related party transactions with its parent LSBD.

Company has related party transactions with LSBD.

See Notes 7 and 8.

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liquidity and short-term nature.

OTHER CURRENT ASSETS

current assets consist of the following:

March 31, 2021

June 30, 2020

Goods and services tax receivable

Other receivables

the three months ended March 31, 2021, the Company made $2,600,000 in prepayments relating to research and development

contributions.

Of the total prepayments, $866,667 was recorded as a non-current asset as of March 31, 2021 based

on the expected outflow of the budgeted research and development costs.

ACCOUNTS PAYABLE AND ACCRUED EXPENSES

March 31, 2021

June 30, 2020

Accounts and other payables

Employee liabilities

(current and non-current)

Related party payables

Employee liabilities (current and non-current)

CONVERTIBLE NOTES PAYABLE

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convertible notes had a contingent Beneficial Conversion Features (BCF), with the contingency being the event of IPO.

a financing cost of $905,948 was recognized as interest expense in the consolidated statements of operations and other

comprehensive loss in relation to this contingent BCF during the three and six months ended December 31, 2020.

a financing cost of $905,948 was recognized as interest expense in the consolidated statements of operations and other comprehensive

loss in relation to this contingent BCF during the nine months ended March 31, 2021.

SHAREHOLDERS’

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December 18, 2020, the Company entered into an Exchange Agreement (the “EA”) with LSBD to exchange 3,000,000 shares

of its common stock held by LSBD for 3,000,000 shares of the Company’s Series B Convertible Preferred Stock (“Exchange”).

of its common stock held by LSBD for 3,000,000 shares of the Company’s Series B Convertible Preferred Stock (the “Exchange”).

In addition, the parties to the Exchange Agreement entered into a Registration Rights Agreement (the “RRA”) pursuant

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The common stock acquired in the Exchange was immediately retired.

Each share of Series B Convertible Preferred Stock is convertible into 1 shares of the Company’s common stock, subject to

Each share of Series B Convertible Preferred Stock is convertible into 1 share of the Company’s common stock, subject to

proportional adjustment and beneficial ownership limitations.

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December 2020, the Company completed its initial public offering.

For further details refer to Note 1.

2021 Transactions

the quarter ended March 31, 2021, Series A and Series B warrants held by certain shareholders were exercised.

Each warrant is

convertible into 1 share of the Company’s common stock.

A total of 58,600 Series A warrants and 1,400,195 Series B warrants

were exercised and converted into common stock.

RELATED-PARTY TRANSACTIONS

December 2020, the Company completed certain financing transactions with its Parent, LSBD as described in Note 7.

Company completed certain financing transactions with LSBD as described in Note 7.

to and purchases from related parties are made in arm’s length transactions both at normal market prices and on normal commercial

The following transactions occurred with LSBD during the period July 1, 2020 to December 31, 2020 (FY2020:

to December 31, 2019):

Company incurred a total of $nil (FY2020:

The following transactions also occurred with LSBD during the period July 1, 2020 to March 31, 2021 (FY2020:

to March 31, 2020):

Company incurred a total of $23,523 (FY2020:

$541,023) towards the services in connection with development and regulatory approval

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Company recognized income of $nil (FY2020:

$121,277) in relation to shared labor reimbursement which includes salaries

directly attributable to the company which are included in shared-services revenue.

$119,744) in relation to shared labour reimbursement which includes salaries directly

attributable to the Company which are included in shared-services revenue.

March 31, 2021, GBS entered into an Option Agreement with LSBD to provide GBS the option to acquire an exclusive license for LSBD’s

intellectual property.

A fee of $500,000 was paid to acquire this option.

For further details refer to Note 3.

the quarter ended March 31, 2021, the Company contributed a total of $2,600,000 towards budgeted development and

commercialization costs to be incurred by BiosensX (North America) Inc.

relating to the development and preparation

for submission of the Saliva Glucose Biosensor connected with regulatory approval for the U.S market by the U.S Food & Drug

Administration.

For further details refer to Note 3.

INVESTMENT IN AFFILIATE

May 29, 2020 the parent Company, Life Science Biosensor Diagnostics Pty Ltd, issued 14,000,000 common shares of BiosensX (North

America) Inc.

May 29, 2020 LSBD, issued 14,000,000 common shares of BiosensX (North America)

to the Company at par value of $0.001 per share.

This transaction provided the Company with a 50% interest in BiosensX

(North America) Inc., the holder of the technology license for the North America region.

This transaction provided the Company with a 50% interest in BiosensX (North

America) Inc., the holder of the technology license for the North America region.

investment in BiosensX (North America) Inc.

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- Equity Method and Joint Ventures .

Science Biosensor Diagnostics Pty Ltd is the parent of both the Company and BiosensX (North America), the transfer of BiosensX

the date of this transaction, LSBD was the parent of both the Company and BiosensX (North America) Inc., the transfer of BiosensX

shares to the Company was deemed to be a common control transaction.

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influence over BiosensX (North America) Inc.

but in accordance with ASC 810 Consolidation Life Science Biosensor Diagnostics

is deemed to have control over BiosensX (North America) Inc.

but in accordance with ASC 810 Consolidation LSBD is deemed to have control

over BiosensX (North America) Inc.

due to its direct ownership of 50% in BiosensX (North America) Inc.

and indirect ownership of 50% in BiosensX (North America) Inc.

and indirect ownership

of 50% in BiosensX (North America) Inc.

through GBS Inc.

of March 31, 2021, LSBD holds 48.7% of common Stock of GBS Inc.

and therefore still has control over BiosensX (North America)

following table summarizes the amount recorded in the consolidated financial statements:

March 31, 2021

June 30, 2020

Investment value

(Loss) income

from the affiliate

(Loss) income from the affiliate

Carrying amount

COMMITMENTS AND CONTINGENCIES

Company has no material future minimum lease commitments or purchase commitments.

time to time, the Company is party to various legal proceedings arising in the ordinary course of business.

Based on information

currently available, the Company is not involved in any pending or threatened legal proceedings that it believes could reasonably

be expected to have a material adverse effect on its financial condition, results of operations or liquidity.

However, legal matters

are inherently uncertain, and the Company cannot guarantee that the outcome of any legal matter will be favorable to the Company.

January 5, 2021, the Company entered into a certain Research Collaboration Agreement with Harvard College for the purposes of

facilitating mutual collaboration in scientific research in connection with the Company’s non-exclusive royalty free license

to combat COVID-19 coronavirus.

The contemplated collaboration includes research teams from the Company and Harvard and will include,

among others, exchange of materials and research data, to now progress with the milestone of integrating the Harvard technology

with the Company’s biosensor with applications for SARS-Cov-2 antibody test for COVID-19.

The Company agreed to pay Harvard

a total amount of $609,375 payable in 3 instalments of which $304,686 remains payable as of March 31, 2021.

January 21, 2021, the Company entered into a sponsored research agreement with Johns Hopkins Bloomberg School of Public Health

to accelerate the development of next-generation saliva-based diagnostic tests.

The Company is collaborating with the Bloomberg

School of Public Health to optimise the collection of saliva and monitoring of diverse biomarkers across a number of modalities

including clinical chemistry and infectious diseases.

Johns Hopkins intend to utilise biosensor products to conduct in-field epidemiological

The Company agreed to pay Johns Hopkins a total amount of $423,589 as a part of this sponsored research agreement of

which all remains payable as of March 31, 2021.

Company has no other material future minimum lease commitments or purchase commitments.

time to time, the Company may become a party to various legal proceedings arising in the ordinary course of business.

information currently available, the Company is not involved in any pending or threatened legal proceedings that it believes could

reasonably be expected to have a material adverse effect on its financial condition, results of operations or liquidity.

legal matters are inherently uncertain, and the Company cannot guarantee that the outcome of any potential legal matter will be

favorable to the Company.

LOSS PER SHARE

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stock were exercised or converted into common stock.

Net loss attributable to

$ (1,983,964 )

Three Months Ended

Nine Months Ended

March 31, 2021

March 31, 2020

March 31, 2021

March 31, 2020

Net loss attributable to GBS, Inc.

$ (3,127,813 )

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$ (2,706,760 )

Basic and diluted net loss per share

attributed to common shareholders

Basic and diluted net loss per share attributed to common shareholders

Weighted-average number of ordinary shares

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for the periods presented because their effect would have been anti-dilutive:

Anti-dilutive

warrants and preferred shares:

Three Months Ended

Nine Months Ended

March 31, 2021

March 31, 2020

March 31, 2021

March 31, 2020

Warrants - Series A

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SUBSEQUENT EVENTS

to December 31, 2020, the Company received $502,350 in relation to the exercise of 59,100 Series A Warrants to purchase one share

of Common Stock per Warrant at an exercise price $ 8.50.

As of February 11, 2021, a total of 1,402,077 Series A warrants

remain outstanding.

to December 31, 2020 a total of 1,364,495 Series B Warrants were exercised to purchase one Common Stock per Warrants in a cashless

to March 31, 2021 and through to the date of this filing, a total of 500,000 Series B Convertible Preferred Stock was converted

into common stock.

Each share of Series B Convertible Preferred Stock is convertible into 1 share of the Company’s common

Subsequent to March 31, 2021 and through

to the date of this filing, a total of 800 Series B Warrants were exercised to purchase one Common Stock per Warrant in a cashless

exercise provision as described in Company’s Registration Statement on Form S-1, File No.

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Securities and Exchange Commission (the “SEC”).

As of February 11, 2021, a total of 66,382 Series B

remain outstanding.

January 5, 2021, the Company entered into a certain Research Collaboration Agreement with Harvard College for the purposes of

facilitating mutual collaboration in scientific research in connection with the Company’s non-exclusive royalty free license

to combat COVID-19 coronavirus.

The contemplated collaboration includes research teams from the Company and Harvard and will include,

among others, exchange of materials and research data, to now progress with the milestone of integrating the Harvard technology

with the Company’s biosensor with applications for SARS-Cov-2 antibody test for COVID-19.

The Company agreed to pay Harvard

a total amount of $609,375 payable in 3 instalments, with $304,687.50 payable upon receipt of the initial invoice, and two additional

payments of $152,343.75 each, upon 90 and 180 day anniversary following the date of the agreement.

For additional details refer

to form 8-k on January 8, 2021.

Management’s Discussion and Analysis of Financial Condition and Result of Operations

should read the following discussion and analysis of our financial condition and results of operations together with our condensed

consolidated financial statements and the related notes and other financial information included elsewhere in this Quarterly Report

on Form 10-Q.

This discussion and other parts of this report contain forward-looking statements that involve risks and uncertainties,

such as statements of our plans, objectives, expectations and intentions, that are based on the beliefs of our management, as

well as assumptions made by, and information currently available to, our management.

Our actual results could differ materially

from those discussed in these forward-looking statements.

Given these uncertainties, you should not place undue reliance on these

forward-looking statements.

In addition, statements that “we believe”

and similar statements reflect our beliefs and

opinions on the relevant subject.

These statements are based upon information available to us as of the date of this report, and

while we believe such information forms a reasonable basis for such.

are a biosensor diagnostic technology company developing our COV2 test and across the Asia-Pacific region (“APAC”)

and a biosensor platform comprising of biochemistry, immunology, tumour markers, hormones, and nucleic acid diagnostic modalities.

should read the following discussion and analysis of our financial condition and results of operations together with our condensed consolidated

financial statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q.

This discussion and other parts of this report contain forward-looking statements.

These forward-looking statements involve a number

of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be

materially different from those expressed or implied by these forward-looking statements.

These forward-looking statements involve a

number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance

to be materially different from those expressed or implied by these forward-looking statements.

Our forward-looking statements include,

but are not limited to, statements regarding our or our management team’s expectations, hopes, beliefs, intentions or strategies

regarding the future.

In addition, any statements that refer to projections, forecasts or other characterizations of future events or

circumstances, including any underlying assumptions, are forward-looking statements.

The words “anticipate,”

“believe,”

“continue,”

“could,”

“estimate,”

“expect,”

“intends,”

“may,”

“might,”

“plan,”

“possible,”

“potential,”

“predict,”

“project,”

“should,”

“would”

and similar expressions may identify forward-looking statements, but the absence of these words

does not mean that a statement is not forward-looking.

Factors that might cause or contribute to such forward-looking statements include,

but are not limited to, those set forth in the Risk Factors section of the Company’s registration statement and prospectus for

the Company’s initial public offering filed with the SEC.

The following discussion should be read in conjunction with our financial

statements and related notes thereto included elsewhere in this report.

We are a biosensor diagnostic technology

company developing our SARS COV2 antibody (“COV2”) test for the world market, the Saliva Glucose

Biosensor (“SGB”) for the Asia-Pacific region (“APAC”) and have a 50% interest for the North America

This the prelude to a biosensor platform comprising of biochemistry, immunology, tumor markers, hormones, and

nucleic acid diagnostic modalities.

We were incorporated under the laws of Delaware on December 5, 2016.

Our headquarter is in New York.

We were formed to provide

a non-invasive, pain free innovation to make it easier for people to manage diabetes using the Company’s Saliva Glucose

Biosensor (“SGB”

and, together with the software app that interfaces the SGB with the Company’s digital information

system, the “SGT”)

currently have 54.4% of our common stock owned by Life Science Biosensor Diagnostics Pty Ltd

(“LSBD”).

an Australian company that owns the worldwide intellectual property rights to the biosensor platform from

University of Newcastle, Australia.

LSBD has licensed to us that technology for us to introduce and launch the platform in the

We will commence this process with the SGT.

Our headquarters are

We were formed to provide a non-invasive, pain free innovation to make it easier for people to manage diabetes

using the Company’s SGB and, together with the software app that interfaces the SGB with the Company’s digital

information system, the “SGT”).

currently are a 48.7%-owned (by voting rights) affiliate of Life Science Biosensor Diagnostics Pty Ltd (“LSBD”), an

Australian company that owns the worldwide intellectual property rights to the biosensor platform from University of Newcastle,

LSBD has licensed to us that technology for us to introduce and launch the platform in the APAC Region.

We will commence

this process with the SGT.

objective is to introduce and launch a COV2 test globally and then the SGB, the second of our diagnostic tests that stem from

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immunology, hormones, chemistry, tumour markers and nucleic

believe that the COVID-19 pandemic is likely to remain with us for many decades.

Development of an improved antibody assays to

detect prior infection with SARS-CoV-2 has been identified as one of the top unmet needs in the ongoing COVID-19 pandemic response.

believe that the COVID-19 pandemic is likely to remain with us for many years.

Development of an improved antibody assays

to detect prior infection with SARS-CoV-2 has been identified as one of the top unmet needs in the ongoing COVID-19 pandemic response.

Precise knowledge of SARS-CoV-2 infection at the individual level can potentially inform clinical decision-making, whereas at

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and scalable point-of-care (POC) tests for the diagnosis of COVID-19 would increase the scope for diagnosis to be made in the

community and outside the laboratory setting They would have the potential to reduce the time to obtaining an actionable result,

community and outside the laboratory setting.

They would have the potential to reduce the time to obtaining an actionable result,

could support early identification of those with COVID-19 and could also support appropriate use of isolation resources, infection

control measures, and recruitment into clinical trials of treatments.

We are progressing with the milestone of

integrating Harvard University’s technology with our biosensor applications for SARS-Cov-2 antibody test for COVID-19 by

entering on January 5, into a Research Collaboration Agreement with Harvard College for the purposes of facilitating mutual collaboration

in scientific research in connection with the Company’s non-exclusive royalty free license to combat COVID-19 coronavirus.

The contemplated collaboration includes research teams from the Company and Harvard and will include, among others, exchange of

materials and research data.

are progressing with the milestone of integrating Harvard University’s technology with our biosensor applications for SARS-Cov-2

antibody test for COVID-19 by entering on January 5, into a Research Collaboration Agreement with Harvard College for the purposes

of facilitating mutual collaboration in scientific research in connection with the Company’s non-exclusive royalty free

license to combat COVID-19 coronavirus.

The contemplated collaboration includes research teams from the Company and Harvard and

will include, among others, exchange of materials and research data.

Company has not generated any revenues to date.

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achieve substantial acceptance in the marketplace for the first of a series of products in its medical device portfolio.

2020 Transactions

Quarter Developments

December 14, 2020, the Company agreed to issue to LSBD, in consideration of LSBD’s contribution towards the research and

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accredited investor (the “Purchaser”) pursuant to which LSBD sold and assigned to the Purchaser 3,000,000 shares of

the Series B Convertible Preferred Stock and assigned to the Purchaser its rights under the EA and the RRA with respect to the

such preferred shares for a total purchase price of $2,000,000.

the Series B Convertible Preferred Stock and assigned to the Purchaser its rights under the EA and the RRA with respect to such

preferred shares for a total purchase price of $2,000,000.

The investor’s Series B Convertible Preferred Stock is convertible

into 3,000,000 shares of the Company’s common stock, subject to beneficial ownership limitation.

January 21, 2021, we filed a registration statement on Form S-1 with the U.S.

Securities and Exchange Commission to register the

resale of the shares issuable upon conversion of the Series B Convertible Preferred Stock.

public offering

Quarter Developments

Point-of-Care Test Commercialization Ecosystem Established

approval from the Harvard Longwood campus Institutional Review Board (IRB) to commence

a validation study to test clinical samples from a COVID-19 repository and to commence

clinical studies on the COVID-19 Antibody Biosensor;

and aligned with word-class institutions, Johns Hopkins University, The Wyss Institute for Biologically Inspired Engineering,

and the University of Newcastle for the development of saliva-based POCTs for both glucose monitoring and COVID-19 antibody

new top-tier members to GBS’s scientific team to formulate and execute its commercialization plan.

Key Developments

Commenced research protocols with The Wyss Institute for

Biologically Inspired Engineering to progress with the milestone of integrating this technology with the Company’s Biosensor

for SARS-Cov-2 antibody tests;

Initiated study for the salivary collection protocol with

Johns Hopkins University, Bloomberg School of Public Health;

Completed technical optimization of the Wyss’s eRapid

assay performance in relation to SARS-Cov-2 antibody detection at The Wyss Institute to align with the fastest antibody tests

currently on market using clinical samples.

Key Developments

a clinical plan for regulatory submission and subsequent approval with Precision Medicine Architects, LLC;

Commenced global

voice of customer survey with Precision Medicine Architects, LLC as part of the process to finalize product development of

the device and usability;

Further development

of prototyping for middleware and smart phone application;

Executed option

agreement to acquire the rights to use, make, market, sell and offer to sell Products under the Intellectual Property Rights

in the Glucose Field in the North American market for the Saliva Glucose Biosensor .

the quarter ended March 31, 2021, Series A and Series B warrants held by certain shareholders were exercised.

is convertible into 1 share of the Company’s common stock.

A total of 58,600 Series A warrants and 1,400,195 Series

B warrants were exercised and converted into common stock.

March 31, 2021, GBS entered into an agreement with LSBD to provide GBS an option to acquire an exclusive license to use LSBD’s

intellectual property in the treatment or management of diabetes field in North America (the “Option Agreement”).

The Option Agreement has a term of two years and the exercise price for the option is $5 million.

to March 31, 2021, a total of 500,000 Series B Convertible Preferred Stock was converted into common stock.

Each share of Series

B Convertible Preferred Stock is convertible into 1 share of the Company’s common stock as described in the Company’s

Registration Statement on Form S-1, File No.

333-242277 with the U.S.

Securities and Exchange Commission.

public offering & share structure

December 28, 2020, the Company closed its initial public offering (“IPO”) and sold 1,270,589 units, consisting of

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issued in the offering generated $17,732,448 in net proceeds, which amount is net of $1,714,001 in underwriters’

and commissions, and $2,153,564 in offering costs (including deferred equity offering cost of $1,863,612).

also issued to the underwriter an option, exercisable one or more times in whole or in part, to purchase up to 190,588 additional

shares of common stock and/or Series A Warrants to purchase up to an aggregate of 190,588 shares of common stock and/or Series

B Warrants to purchase up to an aggregate of 190,588 shares of common stock, in any combinations thereof, from us at the public

offering price per security, less the underwriting discounts and commissions, for 45 days after the date of the IPO to cover over-allotments,

if any (the “Over-Allotment Option”).

and commissions, and $2,153,564 in offering costs.

The Company also issued to the underwriter an option, exercisable one or more

times in whole or in part, to purchase up to 190,588 additional shares of common stock and/or Series A Warrants to purchase up

to an aggregate of 190,588 shares of common stock and/or Series B Warrants to purchase up to an aggregate of 190,588 shares of

common stock, in any combinations thereof, from us at the public offering price per security, less the underwriting discounts

and commissions, for 45 days after the date of the IPO to cover over-allotments, if any (the “Over-Allotment Option”).

the closing of the IPO, all shares of preferred stock then outstanding were automatically converted into 2,810,190 shares of common

stock, and all convertible notes then outstanding were automatically converted into 710,548 shares of common stock.

of the preferred shareholders were issued warrants that, following the Company’s completed IPO, allow the holder to acquire

preferred shareholders were issued warrants that, following the Company’s completed IPO, allow the holder to acquire 2,736,675

shares of common stock at the IPO price during years two through three following the IPO.

At exercise date, the shareholder

must hold for each warrant to be exercised, one underlying common share to exercise the option.

The warrants are not transferable

and apply to the number of shares that were subscribed for.

At exercise date, the shareholder must

hold for each warrant to be exercised, one underlying common share to exercise the option.

The warrants are not transferable and

apply to the number of shares that were subscribed for.

the share structure as of May 12, 2021 are as follows:

of Issued Common Stock

of Series A warrant exercisable at $8.50

of Series B warrants exercisable at $17 (subject to a cashless

exercise provision)

of Warrants issued to the underwriter exercisable at $18.70

of the Pre-IPO Warrants exercisable at $8.50 (during year two through to year three after the IPO)

Warrants issued to LSBD exercisable at $17

Preferred Stock-Series B

of Operations:

of the Three and Six Months Ended December 31, 2020 and 2019

of the Three and Nine Months Ended March 31, 2021 and 2020

support income

support income increased by $283,037 to $283,037 from $0 for the three months ended December 31, 2020 compared to same period

This increase was primarily attributable to GBS Inc and its subsidiary companies receiving Research and Development tax

incentives and other COVID-19 related government support in the current period where the companies are located.

The purpose of

the grant is to support companies in managing its business and payroll costs.

support income increased by $338,464 to $338,464 from $0 for the six months ended December 31, 2020 compared to same period in

This increase was primarily attributable to GBS Inc and its subsidiary companies receiving Research and Development tax

incentives and other COVID-19 related government support in the current period where the companies are located.

The purpose of

the grant is to support companies in managing its business and payroll costs.

service revenue was $0 and ($798) for the three months ended December 31, 2020 and 2019, respectively, and $0 and $121,277 for

the six months ended December 31, 2020 and 2019, respectively.

support income increased by $34,290 to $34,290 from $0 for the three months ended March 31, 2021 compared to same period in 2020.

This increase was primarily attributable to GBS Inc.’s subsidiary companies receiving COVID-19 related government

support in the current period where the companies are located (The purpose of the grant is to support companies in managing its

business and payroll costs during the COVID-19 pandemic).

support income increased by $372,754 to $372,754 from $0 for the nine months ended March 31, 2021 compared to same period in 2020.

This increase was primarily attributable to GBS Inc.’s subsidiary companies receiving Research and Development tax

The purpose of the grant is to incentivize companies with their research and development related activities

and other COVID-19 related government support in the current period where the companies are located.

service revenue was $0 and $(1,533) for the three months ended March 31, 2021 and 2020, respectively, and $0 and $119,744 for

the nine months ended March 31, 2021 and 2020, respectively.

Shared service revenue is mainly attributable to the recovery of

costs from entities owned by its parent.

costs from related parties.

There were no shared services in the current period.

and administrative expenses

and administrative expenses decreased by $300,562 to $671,450 from $972,012 for the three months ended December 31, 2020 compared

to the same period in 2019.

This decrease was attributable to reduction of expenditures whilst completing the IPO and planning

for the milestones to be achieved after the IPO.

and administrative expenses decreased by $505,887 to $1,192,453 from $1,698,340 for the six months ended December 31, 2020 compared

and administrative expenses increased by $959,547 to $1,013,389 from $53,842 for the three months ended March 31, 2021 compared

to the same period in 2020.

This decrease was also attributable to the limitation of expenditures whilst completing the IPO and

planning for the milestones to be achieved after the IPO.

the Company’s operating activities increase, we expect its general and administrative costs will include additional cost

This increase was primarily driven by an increase in operational activities following completion of the IPO in the current period (December

and administrative expenses increased by $453,660 to $2,205,842 from $1,752,182 for the nine months ended March 31, 2021

compared to the same period in 2020.

This increase was attributable to an increase in operational activities following completion

of the IPO in the current period (December 2020).

the Company’s operating activities increase, we expect its general and administrative costs will include additional costs

in overhead contribution, consultancy, and travel expenses.

and regulatory expenses

and regulatory expenses decreased by $152,847 to $341,820 from $494,667 for the three months ended December 31, 2020 compared

to the same period in 2019.

This decrease was attributable to limitation of expenditure on such activities until the funding had

been secured by the IPO.

The Company is now in a position to progress on its milestones.

and regulatory expenses decreased by $227,090 to $372,758 from $599,848 for the six months ended December 31, 2020 compared to

the same period in 2019.

This decrease was again attributable to limitation of expenditure on such activities until the funding

had been secured by the IPO.

The Company is now in a position to progress on its milestones.

and regulatory expenses increased by $2,215,141 to $2,156,316 from $(58,825) for the three months ended March 31, 2021

compared to the same period in 2020.

This increase is primarily driven by funding availability since completion of the IPO

in December 2020 that has allowed the Company to progress on its milestones, as well as a $500,000 option that the Company expensed

on the basis that there is no FDA approval of the intellectual property held by LSBD.

and regulatory expenses increased by $1,988,051 to $2,529,074 from $541,023 for the nine months ended March 31, 2021 compared to the

same period in 2020.

This increase is primarily driven by funding availability

since completion of the IPO in December 2020 that has allowed the Company to progress on its milestones, as well as a $500,000 option

that the Company expensed on the basis that there is no FDA approval of the intellectual property held by LSBD.

the Company’s operating activities increase, we expect its development and regulatory expenses to increase in future periods.

and capital raising expenses

and capital raising expenses decreased by $49,345 to $187,093 from $236,438 for the three months ended December 31, 2020 as compared

and capital raising expenses decreased by $27,174 to $5,100 from $32,274 for the three months ended March 31, 2021 as compared

to the same period in 2020.

This decrease was attributable to fewer expenditures required by us in the current period being in

the final stages of completing our IPO.

and capital raising expenses increased by $211,209 to $353,574 from $142,365 for the six months ended December 31, 2020 as compared

This decrease was attributable to minimal expenditures required by us in the current period having

completing our IPO in December 2020.

and capital raising expenses increased by $184,035 to $358,674 from $174,639 for the nine months ended March 31, 2021 as compared

to the same period in 2020, respectively.

This increase was attributable to credit notes received from some suppliers in the first

quarter of the previous period.

This increase was attributable to majority of final expenditures required by us in the

current period to successfully complete the IPO in December 2020.

income and expenses

expense increased $837,715 to $986,860 from $149,145 for the three months ended December 31, 2020 as compared to the same period

expense decreased $63,744 to $18,561 from $82,305 for the three months ended March 31, 2021 as compared to the same period in

This decrease was attributable to the conversion of convertible notes into common stock at completion of the IPO.

expense increased $710,288 to $1,091,249 from $380,961 for the nine months ended March 31, 2021 as compared to the same period

This increase was attributable to the non-cash recognition of a beneficial conversion feature associated with convertible

expense increased $774,032 to $1,072,688 from $298,656 for the six months ended December 31, 2020 as compared to the same period

This increase was also attributable to the non-cash recognition of a beneficial conversion feature associated with convertible

from unconsolidated equity method investment

from unconsolidated equity method investment was $0 for the three months ended December 31, 2020 and 2019, respectively.

from unconsolidated equity method investment increased $135,692 from $0 for the six months ended December 31, 2020 compared to

the same period in 2019.

notes, offset by conversion of convertible notes into common stock that occurred at IPO.

(income) from unconsolidated equity method investment

(income) from unconsolidated equity method investment was $0 for the three months ended March 31, 2021 and 2020, respectively.

from unconsolidated equity method investment increased $135,692 to $135,692 from $0 for the nine months ended March 31, 2021 compared

to the same period in 2020.

This increase was attributable to the reduction in the carrying amount of its investment in BiosensX

(North America) Inc.

foreign exchange loss

foreign exchange loss increased $86,637 from $0 for the three months ended December 31, 2020 compared to the same period in 2019.

This increase was attributable to the unfavourable foreign exchange translations on capital raisings from AUD to USD.

foreign exchange loss increased $279,107 from $0 for the six months ended December 31, 2020 compared to the same period in 2019.

This increase was attributable to the unfavourable foreign exchange translations on capital raisings from AUD to USD.

foreign exchange gain (loss)

foreign exchange gain was $8,774 for the three months ended March 31, 2021 compared to $0 for the same period in 2020.

This increase

was attributable to the favorable foreign exchange translations upon settling payments in foreign currency.

foreign exchange loss was $270,333 for the nine months ended March 31, 2021 compared to $0 the same period in 2020.

This increase

was largely attributable to the unfavorable foreign exchange translations on capital raisings from AUD to USD.

tax (expense) benefit

tax expense was $0 for the three and six months ended December 31, 2020 and 2019 as the Company has established a full valuation

was no income tax expense for the three and nine months ended March 31, 2021 and 2020 as the Company has established a full valuation

allowance for all of its deferred tax assets.

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currency translation gain/(loss)

foreign currency translation gain/(loss) increased by $167,142 to $33,856 from ($133,286) for the three months ended December

foreign currency translation gain/(loss) increased by ($362,953) to ($262,032) from $100,921 for the three months ended March

31, 2021 as compared to the same period in 2020.

It is calculated based on the Company’s unsettled transactions in currencies

other than its functional currency.

foreign currency translation gain/(loss) increased by $112,338 to ($16,712) from ($129,050) for the six months ended December

It is calculated based on the Company’s unsettled transactions and balances

in currencies other than its functional currency.

foreign currency translation gain/(loss) increased by ($250,615) to ($278,744) from ($28,129) for the nine months ended March

31, 2021 and 2020, respectively.

It is calculated based on the Company’s unsettled transactions in currencies other than

its functional currency.

loss increased by $137,356 to $1,990,389 from $1,853,033 for the three months ended December 31, 2020 compared to the same period

This overall increase was largely attributable to the non-cash recognition of a beneficial conversion feature, partially

offset by government support income and the limitation of expenditure on general and administrative expenses until funding had

been secured by the IPO, and the company was in a position to progress on its regulatory and development milestones.

loss increased by $449,441 to $3,067,304 from $2,617,863 for the six months ended December 31, 2020 compared to the same period

This overall increase was largely attributable to the non-cash recognition of a beneficial conversion feature, partially

offset by government support income and the limitation of expenditure on general and administrative expenses until funding had

been secured by the IPO, and the company was in a position to progress on its regulatory and development milestones.

It is calculated based on the Company’s unsettled transactions and balances in currencies

other than its functional currency.

loss increased by $3,031,560 to $3,142,667 from $111,107 for the three months ended March 31, 2021 compared to the same

period in 2020.

This overall increase was largely attributable to further progression on regulatory and development milestones and increased

expenditure on general and administrative expenses with funding secured by the IPO.

Further contributing to this movement was an option

fee of $500,000 to acquire an exclusive license for LSBD’s intellectual property, $268,457 in overhead reimbursements reversed,

as well as changes in the foreign currency exchange rate between AUD and USA due to COVID-19, both within the same period in 2020.

loss increased by $3,481,001 to $6,209,971 from $2,728,970 for the nine months ended March 31, 2021 compared to the same

period in 2020.

This overall increase was largely attributable to the non-cash recognition of a beneficial conversion feature,

an option fee to acquire an exclusive license for LSBD’s intellectual property and

increased expenditure on general and administrative expenses and further progression on regulatory and development milestones

with funding secured by the IPO.

and Capital Resources

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stock and the incurrence of debt.

As of December 31, 2020, we had $19,877,860 in cash and cash equivalents and $18,799,962 in

working capital.

As of March 31, 2021, we had $14,261,622 in cash and cash equivalents and $15,026,877

in working capital.

“Initial public offering”

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working capital and general corporate purposes.

do not anticipate generating any revenue until after 6-10 months following the date of this filing, if at all, and our revenues

will not immediately be sufficient to finance our ongoing operations.

In addition, available resources may be consumed more rapidly

than currently anticipated, and there can be no assurance that we will be successful in developing the SGT and generating sufficient

revenue in the timeframe set forth above, or at all.

We may be unable to meet our targets for regulatory approval and market launch,

or we may be unable to generate anticipated amounts of revenue from sales of the system.

We may also need additional funding for

developing new products and services and for additional sales, marketing and promotional activities.

Should this occur, we may

need to seek additional capital earlier than anticipated.

do not anticipate generating any revenue commencing in the vicinity of 6-10 months from the date of this report, if at all, and

our revenues will not immediately be sufficient to finance our ongoing operations.

In addition, available resources may be consumed

more rapidly than currently anticipated, and there can be no assurance that we will be successful in developing the SGT and generating

sufficient revenue in the timeframe set forth above, or at all.

We may be unable to meet our targets for regulatory approval and

market launch, or we may be unable to generate anticipated amounts of revenue from sales of the system.

We may also need additional

funding for developing new products and services and for additional sales, marketing and promotional activities.

Should this occur,

we may need to seek additional capital earlier than anticipated.

the event we require additional capital, there can be no assurances that we will be able to raise such capital on acceptable terms,

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Sheet Arrangements

December 31, 2020, we have not entered into any off-balance sheet arrangements as defined by applicable SEC regulations.

March 31, 2021, we have not entered into any off-balance sheet arrangements as defined by applicable SEC regulations.

Accounting Policies, Significant Judgments and Use of Estimates

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of this Quarterly Report on Form 10-Q.

During the six months ended

December 31, 2020, except as described in Note 3 to the unaudited interim condensed financial statements appearing elsewhere in

this Quarterly Report on Form 10-Q, there were no material changes to our critical accounting policies from those discussed in

our final prospectus filed on December 18, 2020.

During the nine months ended

March 31, 2021, except as described in Note 3 to the unaudited interim condensed financial statements appearing elsewhere in this

Quarterly Report on Form 10-Q, there were no material changes to our critical accounting policies from those discussed in our

final prospectus filed on December 18, 2020.

Accounting Pronouncements

6 unchanged sentences

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

What changed 10-Q

Item 1. Financial Statements