What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2023-04-26 compared with 2022-04-29 · 796 added, 810 removed, 345 unchanged (82% of the section changed)

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Report of Independent Registered Public Accounting Firm (PCAOB ID:

3627 ) F-2 - F-3

Consolidated Balance Sheets at January 31, 2023 and 2022 F-4

Consolidated Statements of Operations and Comprehensive Loss for the years ended January 31, 2023 and 2022 F-5

Consolidated Statements of Changes in Stockholder’s Equity (Deficit) for the years ended January 31, 2022 and 2021 F-6

Consolidated Statements of Changes in Stockholder’s Equity for the years ended January 31,2023 and 2022 F-6

Consolidated Statements of Cash Flows for the years ended January 31, 2023 and 2022 F-8

Notes to Consolidated Financial Statements F-9

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Directors of Nutriband Inc.:

REPORT OF INDEPENDENT

REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of Nutriband

Opinion on the Financial Statements

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balance sheets of Nutriband Inc.

and Subsidiaries (“the Company”) as of January 31, 2022 and 2021, the related consolidated

statements of operations and comprehensive loss, stockholders’ equity, and cash flows for each of the years in the two-year period

ended January 31, 2022 and the related notes (collectively referred to as the “financial statements”).

In our opinion, the

financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 31,

2022 and 2021, and the results of its operations and its cash flows for each of the years in the two-year period ended January 31, 2022,

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

(“the Company”) as of January 31, 2023 and 2022, the related consolidated statements of operations

and comprehensive loss, stockholders’ equity, and cash flows for each of the years in the two-year period ended January 31, 2023

and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements referred

to above present fairly, in all material respects, the financial position of the Company as of January 31, 2023 and 2022, and the results

of its operations and its cash flows for each of the years in the two-year period ended January 31, 2023, in conformity with accounting

principles generally accepted in the United States of America.

Basis for Opinion

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to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding

As part of our audits, we are required to obtain an understanding

of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s

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The critical audit matters communicated below

are matters arising from the current-period audit of the consolidated 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.

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 matters below, providing a

separate audit opinion on the critical audit matters or on the accounts or disclosures to which it relates.

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) related to accounts or disclosures that are material to the financial statements and (2) involved our

especially challenging, subjective, or complex judgements.

The communication of critical audit matters does not alter in any way our opinion

on the financial statements, taken as a whole, and we are not, by communicating the critical matters below, providing separate opinions

on the critical audit matters or on the accounts or disclosures to which they relate.

Long-Lived Asset Impairment Assessment

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tested its long-lived assets during the year ended January 31, 2023.

The Company’s evaluation of the recoverability of these

long-lived asset groups involved comparing the undiscounted future cash flows expected to be generated by these long-lived asset

groups to its their respective carrying amounts.

The Company’s recoverability analysis requires management to make significant estimates

and assumptions related to forecasted sales growth rates and cash flows over the remaining useful life of these long-lived asset groups.

We identified the evaluation of the

impairment analysis for long-lived assets as a critical audit matter because of the significant estimates and assumptions management used

in the related cash flow analysis.

Performing audit procedures to evaluate the reasonableness of these estimates and assumptions required

a high degree of auditor judgment and an increased extent of effort.

recoverability analysis for these long-lived assets as a critical audit matter because of the significant estimates and assumptions management

used in the related cash flow analysis.

Performing audit procedures to evaluate the reasonableness of these estimates and assumptions

required a high degree of auditor judgment and an increased extent of effort.

How the Critical Audit Matter was

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Our audit procedures related to the

● Testing management’s process for developing

the fair value estimate.

● Evaluating the appropriateness of the cash flow

model used by management.

● Testing the completeness and accuracy of underlying

data used in the fair value estimate.

● Evaluating the significant assumptions used by

management related to revenues, gross margin, other operating expenses, income taxes and long-term growth rate to discern whether they

are reasonable considering (i) the current and past performance of the entity;

(ii) the consistency with external market and industry

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

● Professionals with specialized skill and knowledge were utilized by the Firm

to assist in the evaluation of the discounted cash flow model and discount rate assumptions.

● Testing management’s process for developing the tests for recoverability.

● Evaluating the appropriateness of the undiscounted cash flow models used by management.

● Testing the completeness and accuracy of underlying data used in the undiscounted cash flow model.

● Evaluating the significant assumptions used by management, including assumptions related to revenues,

gross margin, other operating expenses and income taxes to discern whether they are reasonable considering (i) the current and past performance

of the entity;

(ii) the consistency with external market and industry data;

and (iii) whether these assumptions were consistent with evidence

obtained in other areas of the audit.

● Professionals with specialized skill and knowledge were utilized by the Firm to assist in the evaluation of the undiscounted cash

flow model and underlying assumptions.

Goodwill Impairment Assessment

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financial statements, the Company tests goodwill for impairment annually at the reporting unit level, or more frequently, if events or

circumstances indicate it is more likely than not that the fair value of a reporting unit is less than its carrying amount.

circumstances indicate it is more likely than not that the fair value of a reporting unit is less than it’s carrying amount.

units are tested for impairment by comparing the estimated fair value of each reporting unit with its carrying amount.

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Our audit procedures related to the

● Testing management’s process for developing

the fair value estimate.

● Evaluating the appropriateness of the discounted

cash flow model used by management.

● Testing the completeness and accuracy of underlying

data used in the fair value estimate.

● Evaluating the significant assumptions used by

management related to revenues, gross margin, other operating expenses, income taxes, long term growth rate, and discount rate to discern

whether they are reasonable considering (i) the current and past performance of the entity;

(ii) the consistency with external market

and industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

● Professionals with specialized skill and knowledge

were utilized by the Firm to assist in the evaluation of the discounted cash flow model and discount rate assumptions.

● Testing management’s process for developing the fair value estimate.

● Evaluating the appropriateness of the discounted cash flow model used by management.

● Testing the completeness and accuracy of underlying data used in the fair value estimate.

● Evaluating the significant assumptions used by management including those related to revenues, gross margin,

other operating expenses, income taxes, long term growth rate, and discount rate to discern whether they are reasonable considering (i)

the current and past performance of the entity;

(ii) the consistency with external market and industry data;

and (iii) whether these assumptions

were consistent with evidence obtained in other areas of the audit.

● Professionals with specialized skill and knowledge were utilized by the Firm to assist in the evaluation

of the discounted cash flow model and underlying assumptions.

/s/ Sadler, Gibb & Associates, LLC

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April 25, 2023

NUTRIBAND INC.

AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE

CURRENT ASSETS:

Cash and cash equivalents

cash equivalents

Accounts receivable

Prepaid expenses

Total Current Assets

Current Assets

PROPERTY & EQUIPMENT-net

OTHER ASSETS:

Right of use asset

Intangible assets-net

LIABILITIES AND STOCKHOLDERS’ EQUITY

Operating lease right

LIABILITIES AND

STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES:

Accounts payable and accrued expenses

Accounts payable and

accrued expenses

Deferred revenue

Operating lease liability

Notes payable-related party, net

Finance lease liabilities-current portion

Notes payable-current portion

Total Current Liabilities

Operating lease liability-current

payable-current portion

Current Liabilities

LONG-TERM LIABILITIES:

Note payable-net of current portion

Finance lease liabilities-net of currnt portion

Total Liabilities

Note payable-net of

current portion

lease liability-net of current portion

Commitments and Contingencies

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Common stock, $ .001 par value, 291,666,666 shares authorized;

7,871,359 and 6,256,770 shares issued at January 31, 2022 and 2021, 7,843,234 and 6,256,770 shares outstanding at January 31, 2022 and 2021, respectively

7,843,150 shares issued at January 31, 2023 and 9,187,659 issued at January 31, 2022, 7,833,150 and 9,154,846 shares outstanding as of January 31,2023 and 2022, respectively

Additional paid-in-capital

Subscription payable

Accumulated other comprehensive loss

Treasury stock, 28,125 shares at cost

Accumulated deficit

Accumulated other comprehensive

Treasury stock, 10,000 and 32,813 shares at cost, respectively

( 22,494,705 )

( 18,011,231 )

Total Stockholders’ Equity

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

NUTRIBAND INC.

Stockholders' Equity

LIABILITIES AND STOCKHOLDERS' EQUITY

See notes to consolidated

financial statements

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

CONSOLIDATED STATEMENTS

OF OPERATIONS AND COMPREHENSIVE LOSS

For the Years Ended

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Cost of revenues

Research and development expenses

Research and development

Goodwill impairment

Selling, general and administrative expenses

Selling, general and administrative

Total Costs and Expenses

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Other income (expense):

Gain (loss) on extinguishment of debt

Early prepayment fee on convertible debentures

Gain on change of fair value of derivative

Gain on extinguishment of debt

Interest expense

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$ ( 6,372,715 )

NUTRIBAND INC.

See notes to consolidated

financial statements

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

CONSOLIDATED STATEMENTS

OF STOCKHOLDERS' EQUITY

Comprehensive

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$ ( 18,011,231 )

Common stock issued for proceeds

and payment for license

Proceeds from sale of common

stock and warrants in public offering

Proceeds from exercise of warrants

Cashless exercise of warrants

Common stock issued for note

Common stock issued for services

Common stock issued for settlement

of liabilities

Warrants issued for services

$ ( 104,467 )

Exercise of warrants

Common stock returned in settlement

( 1,400,000 )

Treasury stock issued for services

Treasury stock and warrants issued for termination agreement

Treasury stock repurchased

Employee stock options issued

Warrants issued for round

down settlement

Deemed dividend from warrants

loss for the year ended January 31, 2022

Options issued for services

Net loss for the year ended January 31, 2023

( 4,483,474 )

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$ ( 22,494,705 )

$ ( 104,467 )

Comprehensive

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$ ( 11,835,105 )

Proceeds from sale of common

stock and warrants

Issuance of common stock

for acquisition

Issuance of common stock

for note payable

Subscription payable for

Reclassification of warrants

from liability to equity

loss for the year ended January 31, 2021

Proceeds from sale of common stock and warrants in public offering

Proceeds from exercise of warrants

Cashless exercise of warrants

Issuance of common stock for notes payable

Common stock issued for settlement of liabilities

Warrants issued for services

Common stock issued for proceeds and in payment for license

Common stock issued for services

Treasury stock repurchased

Employee stock options issued for services

Settlement of warrant round down

Deemed dividend for warrants

Net loss for the year ended January 31, 2022

( 6,176,126 )

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$ ( 18,011,231 )

$ ( 104,467 )

See notes to consolidated

financial statements

NUTRIBAND INC.

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CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Year Ended

Cash flows from operating activities:

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

Expenses paid on behalf of the Company by related party

Depreciation and amortization

Amortization of debt discount

Gain on change in fair value of derivative

Early prepayment fee on convertible debentures

Amortization of right of use asset

(Gain) loss on extinguisment of debt

Common stock issued for services

Goodwill impairment

(Gain) loss on extinguishment of debt

Stock-based compensation-options

Stock-based compensation-warrants

Subscription payable

Treasury stock and warrants issued for termination agreement

Treasury stock issued for services

Goodwill impairment

Common stock issued for services

Changes in operating assets and liabilities:

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( 2,987,198 )

( 2,809,223 )

Cash flows from investing activities:

Cash received from acquisition

Purchase of equipment

Net Cash Provided by (used in) Investing Activities

Net Cash Used in Investing Activities

Cash flows from financing activities:

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Proceeds from sale of common stock in public offering

Proceeds from exercise of warrants

Proceeds from stock subscription

Proceeds from notes payable

Payment on convertible debt

Proceeds from the exercise of warrants

Payment on note payable

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Purchase of treasury stock

Proceeds from related parties

Payment of related party payables

Net Cash Provided by Financing Activities

Net Cash Provided by (used in) Financing Activities

Effect of exchange rate on cash

Net change in cash

( 2,906,428 )

Cash and cash equivalents - Beginning of period

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Supplemental disclosure of non-cash investing and financing activities:

Common stock returned in settlement

Common stock issued for settlement of notes payable

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Non-cash payment for license agreement

Derivative liability warrant reclassed to equity

Common stock issued for subscription payable

Common stock and note issued in acquisition

Common stock issued for settlement of liabilities

Adoption of ASC 842 Operating lease asset and liability

Promissory note on equipment purchase

Settlement of liabilities for common stock

Deemed dividend in connection with warrant round down

Cashless exercise of warrant

Adoption of ASC 842 Operating lease asset and liability

See notes to consolidated

financial statements

NUTRIBAND INC.

AND SUBSIDIARIES

to Consolidated Financial Statements

of and for the Years Ended January 31, 2022 and 2021

ORGANIZATION AND DESCRIPTION

Notes to Consolidated Financial Statements

as of and for the Years Ended January 31, 2023

ORGANIZATION AND DESCRIPTION OF

Nutriband Inc.

(the “Company”) is a Nevada corporation, incorporated on January 4, 2016.

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References to the Company relate to the Company and its subsidiaries unless the context indicates otherwise.

August 1, 2018, the Company acquired 4P Therapeutics LLC (“4P Therapeutics”) for $2,250,000, consisting of 250,000 shares

of common stock, valued at $1,850,000, and $400,000, and a royalty of 6% on all revenue generated by the Company from the abuse deterrent

intellectual property that had been developed by 4P Therapeutics payable to the former owner of 4P Therapeutics.

The former owner of

4P Therapeutics has been a director of the Company since April 2018, when the Company entered into an agreement to acquire 4P Therapeutics.

The former owner resigned as a director in January 2022.

Therapeutics is engaged in the development of a series of transdermal pharmaceutical products, that are in the preclinical stage of development.

Prior to the acquisition of 4P Therapeutics, the Company’s business was the development and marketing of a range of transdermal

consumer patches.

Most of these products are considered drugs in the United States and cannot be marketed in the United States without

approval by the Food and Drug Administration (the “FDA”).

The Company entered a feasibility agreement as an initial step

to seek FDA approval of its consumer transdermal products and its consumer products which are not being marketed in the United States.

the acquisition of 4P Therapeutics, 4P Therapeutics’ drug development business became the Company’s principal business.

Company’s approach is to use generic drugs that are off patent and incorporate them into the Company’s transdermal drug delivery

Although these medications have received FDA approval in oral or injectable form, the Company needs to conduct a transdermal

product development program which will include the preclinical and clinical trials that are necessary to receive FDA approval before

we can market any of our pharmaceutical products.

August 25, 2020, the Company formed Pocono Pharmaceuticals Inc.

(“Pocono Pharmaceuticals”), a wholly owned subsidiary of

On August 31, 2020, the Company acquired certain assets and liabilities associated with the Transdermal, Topical, Cosmetic,

and Nutraceutical business of Pocono Coated Products LLC (“PCP”).

2018, the Company acquired 4P Therapeutics LLC (“4P Therapeutics”) for $2,250,000, consisting of 250,000 shares of common

stock, valued at $1,850,000, and $400,000, and a royalty of 6% on all revenue generated by the Company from the abuse deterrent intellectual

property that had been developed by 4P Therapeutics payable to the former owner of 4P Therapeutics.

The former owner of 4P Therapeutics

has been a director of the Company since April 2018, when the Company entered into an agreement to acquire 4P Therapeutics.

owner resigned as a director in January 2022.

4P Therapeutics

is engaged in the development of a series of transdermal pharmaceutical products, that are in the preclinical stage of development.

to the acquisition of 4P Therapeutics, the Company’s business was the development and marketing of a range of transdermal consumer

Most of these products are considered drugs in the United States and cannot be marketed in the United States without approval

by the Food and Drug Administration (the “FDA”).

The Company entered a feasibility agreement as an initial step to seek FDA

approval of its consumer transdermal products and its consumer products which are not being marketed in the United States.

With the acquisition

of 4P Therapeutics, 4P Therapeutics’ drug development business became the Company’s principal business.

The Company’s

approach is to use generic drugs that are off patent and incorporate them into the Company’s transdermal drug delivery system.

these medications have received FDA approval in oral or injectable form, the Company needs to conduct a transdermal product development

program which will include the preclinical and clinical trials that are necessary to receive FDA approval before we can market any of

our pharmaceutical products.

On August 25,

2020, the Company formed Pocono Pharmaceuticals Inc.

(“Pocono Pharmaceuticals”), a wholly owned subsidiary of the Company.

On August 31, 2020, the Company acquired certain assets and liabilities associated with the Transdermal, Topical, Cosmetic, and Nutraceutical

business of Pocono Coated Products LLC (“PCP”).

The net assets were contributed to Pocono Pharmaceuticals.

Included in the transaction the Company also acquired 100 % of the membership interests of Active Intelligence LLC (“Active Intelligence”).

See Note 3 for further details of the acquisition.

Pharmaceuticals is a coated products manufacturing entity organized to take advantage of unique process capabilities and experience.

Pocono helps their customer with product design and development along with manufacturing to bring new products to market with minimal

capital investment.

Included in the

transaction, Pocono Pharmaceuticals also acquired 100 % of the membership interests of Active Intelligence LLC (“Active Intelligence”).

Pocono Pharmaceuticals

is a coated products manufacturing entity organized to take advantage of unique process capabilities and experience.

Pocono helps their

customer with product design and development along with manufacturing to bring new products to market with minimal capital investment.

Pocono Pharmaceutical’s competitive edge is a low-cost manufacturing base:

a result of its unique processes

and state of the art material technology.

a result of its unique processes and state of the art

material technology.

Active Intelligence manufactures activated kinesiology tape.

The tape has transdermal and topical

This tape is used as the same as traditional kinesiology tape.

December 2019, COVID-19 emerged and has subsequently spread world-wide.

The World Health Organization has declared COVID-19 a pandemic

resulting in federal, state and local governments and private entities mediating various restrictions, including travel restrictions,

restrictions on public gatherings, stay at home orders and advisories and quarantining people who may have been exposed to the virus.

The effect of these orders, government imposed quarantines and measures the Company would take, such as work-at-home policies, may negatively

impact productivity, disrupt our business and could delay our clinical programs and timelines, the magnitude of which will depend, in

part, on the length and severity of the restrictions and disruptions in our operations could negatively impact our business, operating

The tape has transdermal and topical properties.

tape is used as the same as traditional kinesiology tape.

2019, COVID-19 emerged and has subsequently spread world-wide.

The World Health Organization has declared COVID-19 a pandemic resulting

in federal, state and local governments and private entities proscribing various restrictions, including travel restrictions, restrictions

on public gatherings, stay at home orders and advisories and quarantining people who may have been exposed to the virus.

The effect of

these orders, government imposed quarantines and measures the Company and suppliers and customers it works with might have to take, such

as work-at-home policies, may negatively impact productivity, disrupt our business and could delay our clinical programs and timelines,

the magnitude of which will depend, in part, on the length and severity of the restrictions and disruptions in our operations, operating

results and financial condition.

Fur ther, quarantines, shelter-in-place and similar government orders, or the perception that such orders,

Further, quarantines, shelter-in-place and similar government orders, or the perception that such orders,

shutdowns, or other restrictions on the conduct of business could occur, related to COVID-19 or other infectious diseases could impact

personnel at third-party manufacturing facilities in the United States and other countries, or the availability or cost of materials,

which could disr upt our supply chain.

OF SIGNIFICANT ACCOUNTING POLICIES

of January 31, 2022, the Company believes the substantial doubt about its status as a going concern has been resolved.

The going concern

conditions that caused substantial doubt no longer exist as the Company has positive cash flow during the last year and as of January

31, 2022, has positive working capital.

which could disrupt our supply chain.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2022, our Board of Directors approved the amendment to our Articles of Incorporation to effect a 7 for 6 forward stock split (the “Stock

Split”) of our outstanding common stock.

The Company filed the amendment set forth in a Certificate of Change with the Secretary

of State of Nevada on August 4, 2022.

The 7:6 forward stock split was effective for trading purposes on the Nasdaq Capital Market on August

Each shareholder of record as of the August 15, 2022 record date received one (1) additional share for each six (6) shares held

as of the record date.

No fractional shares of common stock were issued in connection with the Stock Split.

Instead, all shares were rounded

up to the next whole share.

In connection with the Stock Split, which did not require shareholder approval under the Nevada corporation

law, the number of shares of common stock of the Company was increased in the same ratio as the shares of outstanding common stock were

increased in the Stock Split, from 250,000,000 authorized shares to 291,666,666 authorized shares.

All share and

per share information in these financial statements retroactively reflect the forward stock split.

Concern Assessment

assesses liquidity and going concern uncertainty in the Company’s condensed financial statements to determine whether there is sufficient

cash on hand and working capital, including available borrowings on loans, to operate for a period of at least one year from the date

the consolidated financial statements are issued or available to be issued, which is referred to as the “look-forward period”,

as defined in GAAP.

As part of this assessment, based on conditions that are known and reasonably knowable to management, management will

consider various scenarios, forecasts, projections, estimates and will make certain key assumptions, including timing and nature of projected

cash expenditures or programs, its ability to delay or curtail expenditures or programs and its ability to raise additional capital, if

necessary, among other factors.

Based on this assessment, as necessary or applicable, management makes certain assumptions around implementing

curtailments or delays in the nature and timing of programs and expenditures to the extent it deems probable those implementations can

be achieved and management has the proper authority to execute them within the look-forward period.

As of January

31, 2023, the Company had cash and cash equivalents of $ 1,985,440 and working capital of $ 1,945,132 .

For the year ended January 31, 2023,

the Company incurred an operating loss of $ 4,483,474 and used cash flow from operations of $ 2,987,198 .

The Company has generated operating

losses since its inception and has relied on sales of securities and issuance of third-party and related-party debt to support cash flow

from operations.

In October 2021, the Company consummated a public offering and received net proceeds of $ 5,836,230 .

The Company also received $ 2,942,970 of proceeds from the exercise of warrants.

Management retired most of its debt and other current

Management has implemented other plans to alleviate the substantial doubt.

These plans include a substantial increase in

projected sales commitments.

These factors did not exist in prior years during its start-up operations.

The Company’s recent history

of losses has continued but future positive cash flow projections due to its management’s plans which includes its acquisition

in the latter part of 2020 will enable the Company to alleviate the substantial doubt about the Company’s ability to continue as

a going concern.

Management’s plans have been currently implemented.

The plans enable the Company to meet its obligations for at

least one year from the date when the financial statements are issued.

The Company also

received to date $ 3,239,845 proceeds from the exercise of warrants.

The Company has used these proceeds to fund operations and will continue

to use the funds as needed.

In March 2023, the Company entered into a three-year $ 2,000,000 Credit Line Note facility which will permit

the Company to draw down on the credit line to fund the Company’s research and development of its Aversa product.

has prepared estimates of operations for the next twelve months and believes that sufficient funds will be generated from operations to

fund its operations for one year from the date of the filing of these condensed consolidated financial statements, which indicates improved

operations and the Company’s ability to continue operations as a going concern.

The impact of COVID-19 on the Company’s business

has been considered in these assumptions;

however, it is too early to know the full impact of COVID-19 or its timing on a return to normal

believes the substantial doubt about the ability of the Company to continue as a going concern is alleviated by the above assessment.

of Consolidation

consolidated financial statements of the Company include the Company and its wholly owned subsidiaries.

All material intercompany balances

and transactions have been eliminated.

The operations of 4P Therapeutics are included in the Company’s financial statements from

the date of acquisition of August 1, 2018 , and the operations of Pocono and Active Intelligence are included in the Company’s

financial statements from the date of acquisition of September 1, 2020.

The consolidated

financial statements of the Company include the Company and its wholly owned subsidiaries.

All material intercompany balances and transactions

have been eliminated.

The operations of 4P Therapeutics are included in the Company’s financial statements from the date of acquisition

of August 1, 2018, and the operations of Pocono and Active Intelligence are included in the Company’s financial statements from

the date of acquisition of September 1, 2020.

The wholly owned subsidiaries are as follows:

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Pharmaceuticals Inc.

preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States

of America requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and

expenses, and related disclosure of contingent assets and liabilities.

On an ongoing basis, the Company evaluates its estimates including,

but not limited to, those related to such items as income tax exposures, accruals, depreciable/useful lives, allowance for doubtful accounts

Intelligence LLC

The preparation

of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America

requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses,

and related disclosure of contingent assets and liabilities.

On an ongoing basis, the Company evaluates its estimates including, but

not limited to, those related to such items as income tax exposures, accruals, depreciable/useful lives, allowance for doubtful accounts

and valuation allowances.

The Company bases i ts estimates on historical experience and on other various assumptions that are believed

The Company bases its estimates on historical experience and on other various assumptions that are believed

to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying value of assets

and liabilities that are not read ily apparent from other sources.

and liabilities that are not readily apparent from other sources.

Actual results could differ from those estimates.

May 2014, the FASB issued ASU No.

2014-09, “Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which

amends the accounting standards for revenue recognition.

ASU 2014-09 is based on principles that govern the recognition of revenue at

an amount an entity expects to be entitled when products are transferred to a customer.

The Company adopted the guidance under the new

revenue standards using the modified retrospective method effective February 1, 2018 and determined no cumulative effect adjusted to

retained earnings was necessary upon adoption.

Topic 606 requires the Company to recognize revenues when control of the promised goods

or services and receipt of payment is probable.

The Company recognizes revenue based on the five criteria for revenue recognition established

under Topic 606:

1) identify the contract, 2) identify separate performance obligations, 3) determine the transaction price, 4) allocate

the transaction price among the performance obligations, and 5) recognize revenue as the performance obligations are satisfied.

following is a description of the Company’s revenue types, which include professional services and sale of goods:

revenues include the contract of research and development related services with the Company’s

Cash and Cash

Cash equivalents are short-term, highly liquid investments that have

a maturity of three months or less.

the FASB issued ASU No.

2014-09, “Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which amends the

accounting standards for revenue recognition.

ASU 2014-09 is based on principles that govern the recognition of revenue at an amount an

entity expects to be entitled when products are transferred to a customer.

The Company recognizes revenue based on the five criteria for

revenue recognition established under Topic 606:

1) identify the contract, 2) identify separate performance obligations, 3) determine

the transaction price, 4) allocate the transaction price among the performance obligations, and 5) recognize revenue as the performance

obligations are satisfied.

The following

is a description of the Company’s revenue types, which include professional services and sale of goods:

● Service revenues include the contract of research and development related services with the Company’s

clients in the life sciences field on an as-needed basis.

Deliverables primarily consist

of detailed findings and conclusion reports provided to the client for each given research

project engaged.

revenues are derived from the sale of the Company’s consumer transdermal and coated

Deliverables primarily consist of detailed findings and conclusion reports provided

to the client for each given research project engaged.

● Product revenues are derived from the sale of the Company’s consumer transdermal and coated products.

Upon the reception of a purchase order, we have the order filled and shipped.

with Customers

Contracts with Customers

A contract with a customer exists when

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transferred and identifies the payment terms related to these goods or services, (ii) the contract has commercial substance and, (iii)

we determine that collection of substantially all consideration for services that t are transferred is probable based on the customer’s

we determine that collection of substantially all consideration for services that are transferred is probable based on the customer’s

intent and ability to pay the promised consideration.

revenue is a liability related to a revenue producing activity for which revenue has not been recognized.

The Company records deferred

revenue when it receives consideration from a contract before achieving certain criteria that must be met for revenue to be recognized

in conformity with GAAP.

performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in

the new revenue standard.

The contract transaction price is allocated to each distinct performance obligation and recognized as revenue

when, or as, the performance obligation is satisfied.

For the Company’s different revenue service types, the performance obligation

is satisfied at different times.

The Company’s performance obligations include providing products and professional services in

the area of research.

The Company recognizes product revenue performance obligations in most cases when the product has shipped to the

When we perform professional service work, we recognize revenue when we have the right to invoice the customer for the work

completed, which typically occurs over time on a monthly basis for the work performed during that month.

revenue recognized in the income statement is considered to be revenue from contracts with customers.

Disaggregation

Company disaggregates its revenue from contracts with customers by type and by geographical location.

Contract Liabilities

Deferred revenue is a liability related

to a revenue producing activity for which revenue has not been recognized.

The Company records deferred revenue when it receives consideration

from a contract before achieving certain criteria that must be met for revenue to be recognized in conformity with GAAP.

Performance Obligations

A performance obligation is a promise

in a contract to transfer a distinct good or service to the customer and is the unit of account in the new revenue standard.

transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation

is satisfied.

For the Company’s different revenue service types, the performance obligation is satisfied at different times.

Company’s performance obligations include providing products and professional services in the area of research.

The Company recognizes

product revenue performance obligations in most cases when the product has shipped to the customer.

When we perform professional service

work, we recognize revenue when we have the right to invoice the customer for the work completed, which typically occurs over time on

a monthly basis for the work performed during that month.

recognized in the income statement is considered to be revenue from contracts with customers.

Disaggregation of Revenues

disaggregates its revenue from contracts with customers by type and by geographical location.

See the tables:

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United States

accounts receivables are recorded at the net invoice value and are not interest bearing.

The Company maintains allowances for doubtful

accounts for estimated losses from the inability of its customers to make required payments.

The Company determines its allowances by

both specific identification of customer accounts where appropriate and the application of historical loss to non-applicable accounts.

For the years ended January 31, 2022 and 2021, the Company recorded no bad debt expense for doubtful accounts related to account receivable.

Inventories are valued at the lower

of cost and reasonable value determined using the first-in, first-out (FIFO) method.

Net realized value is the estimated selling price

in the ordinary course of business, less applicable variable selling expenses.

The cost of finished goods and work in process is comprised

of material costs, direct labor costs and other direct costs and related production overheads (based on normal operating capacity).

of January 31, 2022 and 2021, 100 % of the inventory consists of raw materials.

Trade accounts

receivables are recorded at the net invoice value and are not interest bearing.

The Company maintains allowances for doubtful accounts

for estimated losses from the inability of its customers to make required payments.

The Company determines its allowances by both specific

identification of customer accounts where appropriate and the application of historical loss to non-applicable accounts.

For the years

ended January 31, 2023 and 2022, the Company recorded no bad debt expense for doubtful accounts related to account receivable.

Inventories are valued at the lower of cost and reasonable value determined

using the first-in, first-out (FIFO) method.

Net realized value is the estimated selling price in the ordinary course of business, less

applicable variable selling expenses.

The cost of finished goods and work in process is comprised of material costs, direct labor costs

and other direct costs and related production overheads (based on normal operating capacity).

As of January 31, 2023, total inventory

was $ 29,335 , consisting of work in process of $ 11,021 and raw materials of $ 218,334 .

As of January 31, 2022, 100 % of the inventory consists

of raw materials.

Plant and Equipment

and equipment represent an important component of the Company’s assets.

equipment represent an important component of the Company’s assets.

The Company depreciates its plant and equipment on a straight-line

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The Company accounts for Other

Intangible Assets under the guidance of ASC 350, “Intangibles-Goodwill and Other.” The Company capitalizes certain costs

related to patent technology.

A substantial component of the purchase price related to the Company’s acquisitions have also been

assigned to intellectual property and other intangibles.

Under the guidance, other intangible assets with definite lives are amortized

over their estimated useful lives.

Intangible Assets under the guidance of ASC 350, “Intangibles-Goodwill and Other.” The Company capitalizes certain costs related

to patent technology.

A substantial component of the purchase price related to the Company’s acquisitions have also been assigned

to intellectual property and other intangibles.

Under the guidance, other intangible assets with definite lives are amortized over their

estimated useful lives.

Intangible assets with indefinite lives are tested annually for impairment.

Trademarks, intellectual

property and customer base are being amortized over their estimated useful lives of ten years .

Goodwill represents the difference between

the total purchase price and the fair value of assets (tangible and intangible) and liabilities at the date of acquisition.

reviewed for impairment annually on January 31, and more frequently as circumstances warrant, and written down only in the period in which

the recorded value of such assets exceeds their fair value.

The Company does not amortize goodwill in accordance with ASC 350.

In connection

with the Company’s acquisition of 4P Therapeutics LLC in 2018, the Company recorded Goodwill of $ 1,719,235 .

On August 31, 2020,

in connection with the Company’s acquisition of the PCP Assets and Active Intelligence, the Company recorded Goodwill of $ 5,810,640 .

During the year ended January 31, 2022, the Company recorded an impairment charge of $ 2,180,836 reducing the PCP Assets and Active Intelligence

goodwill to $ 3,629,813 .

The write down of goodwill is attributable primarily to the effect of the pandemic.

COVID-19, unmet sales expectations,

and other factors the Company determined resulted in the impairment.

The valuation of the reporting unit does not exceed the carrying

amount using the value in use or the going concern premise.

As of January 31, 2022 and 2021, goodwill amounted to $ 5,349,039 and $ 7,529,875 ,

respectively.

Trademarks, intellectual property

and customer base are being amortized over their estimated useful lives of ten years .

Goodwill represents

the difference between the total purchase price and the fair value of assets (tangible and intangible) and liabilities at the date of

Goodwill is reviewed for impairment annually on January 31, and more frequently as circumstances warrant, and written down

only in the period in which the recorded value of such assets exceeds their fair value.

The Company does not amortize goodwill in accordance

with ASC 350.

In connection with the Company’s acquisition of 4P Therapeutics LLC in 2018, the Company recorded Goodwill of $ 1,719,235 .

On August 31, 2020, in connection with the Company’s acquisition of Pocono Coated Products LLC and Active Intelligence LLC, the

Company recorded Goodwill of $ 5,810,640 .

During the years ended January 31, 2023 and 2022, the Company recorded an impairment charge of

$ 327,326 and $ 2,180,836 , respectively, reducing the Active Intelligence LLC Goodwill to $ 3,302,478 .

As of January 31, 2023 and 2022, Goodwill

amounted to $ 5,021,713 and $ 5,349,039 , respectively.

reviews long-lived assets for potential impairment whenever significant events or changes in circumstances indicate that the carrying

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be the difference between the fair market value of the long-lived asset and the related book value.

earnings per share of common stock is computed by dividing net earnings by the weighted average number of shares of common stock outstanding

during the period.

Basic earnings

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

Diluted earnings per share is computed by dividing net earnings by the weighted average number of shares of common

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non-employees.

Company recognizes the assets acquired, the liabilities assumed, and any non-controlling interest in the acquired entity at the acquisition

date, measured at their fair values as of that date, with limited exceptions specified in the accounting literature.

In accordance with

this guidance, acquisition-related costs, including restructuring costs, must be recognized separately from the acquisition and will

generally be expensed as incurred.

That replaces the cost-allocation process detailed in previous accounting literature, which required

the cost of an acquisition to be allocated to the individual assets acquired and liabil ities assumed based on their estimated fair value.

February 2016, the FASB issued ASU 2016-02, “Leases” (Topic 842), to provide a new comprehensive model for lease accounting

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recognition guidance.

Company adopted ASU 2016-02 as amended effective February 1, 2019 using the modified retrospective approach.

In connection with the adoption,

the Company elected to utilize the Comparative Under 840 Option whereby the Company will continue to present prior period financial statements

and disclosures under ASC 840.

In addition, the Company elected the transition package of three practical expedients permitted under

the standard, which eliminates the requirements to reassess prior conclusions about lease identification, lease classification and initial

direct costs.

The Company completed the necessary changes to its accounting policies, processes, disclosure and internal control over

financial reporting.

Company applies the guidance for right-of-use accounting for all leases and records the operating lease liabilities on its balance sheet.

The Company completed the necessary changes to its accounting policies, processes, disclosure and internal control over financial reporting.

and Development Expenses

and development costs are expensed as incurred.

are calculated in accordance with taxation principles currently effective in the United States and Ireland.

The Company accounts for income taxes

under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax

consequences of events that have been included in the financial statements.

Under this method, deferred tax assets and liabilities are

determined based on the differences between the financial statements and tax basis of assets and liabilities using enacted tax rates in

effect for the year in which the differences are expected to reverse.

The effect of a change in tax rates on deferred tax assets and liabilities

is recognized in income in the period that includes the enactment date.

Company records net deferred tax assets to the extent they believe these assets will more-likely-than-not be realized.

development costs are expensed as incurred.

Taxes are calculated

in accordance with taxation principles currently effective in the United States and Ireland.

accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities

for the expected future tax consequences of events that have been included in the financial statements.

Under this method,

deferred tax assets and liabilities are determined based on the differences between the financial statements and tax basis of assets and

liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

The effect of

a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

records net deferred tax assets to the extent they believe these assets will more-likely-than-not be realized.

In making such

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differences, projected future taxable income, tax planning strategies and recent financial operations.

In the event the Company was to

determine that it would be able to realize its deferred income tax assets in the future in excess of its net recorded amount, the Company

would make an adjustment to the valuation allowance which would reduce the provision for income taxes.

In the event the Company

was to determine that it would be able to realize its deferred income tax assets in the future in excess of its net recorded amount, the

Company would make an adjustment to the valuation allowance which would reduce the provision for income taxes.

Concentration

of Credit Risk

instruments which potentially subject the Company to concentrations of credit risk consist principally of cash.

The Company’s cash and

cash equivalents are concentrated primarily in banks.

Financial instruments

which potentially subject the Company to concentrations of credit risk consist principally of cash.

The Company’s cash and cash

equivalents are concentrated primarily in banks.

At times, such deposits could be in excess of insured limits.

Management believes

that the financial institutions that hold the Company’s financial instruments are financially sound and, accordingly, minimal credit

risk is believed to exist with respect to these financial instruments.

As of and for the year ended January 31, 2022, three customers

accounted for 19%, 17% and 13% of the Company’s revenues and three customers accounted for 58%, 21% and 17% of accounts receivable.

As of and for the year ended January 31, 2021, one customer accounted for 62% of the Company’s revenues and two customers accounted

for 67% and 13% of accounts receivable.

Management believes that

the financial institutions that hold the Company’s financial instruments are financially sound and, accordingly, minimal credit

risk is believed to exist with respect to those financial interests.

As of and for the year ended January 31, 2023, two customers accounted

for 34 % and 14 % of the Company’s revenue and one customer accounted for 94 % of accounts receivable.

As of and for the year ended

January 31, 2022, three customers accounted for 19 %, 17 % and 13 % of the Company’s revenue and three customers accounted for 58 %,

21 % and 17 % of accounts receivable.

Value Measurements

ASC 820, “Fair Value Measurements and Disclosure” (“ASC 820”), defines fair value as the exchange price that

would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset

or liability in an orderly transaction between participants on the measurement date.

ASC 820 also establishes a fair value hierarchy

which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

ASC 820 describes three levels of inputs that may be used to measure fair value.

The Company utilizes the accounting

guidance for fair value measurements and disclosures for all financial assets and liabilities and nonfinancial assets and liabilities

that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis during the reporting period.

The fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an

orderly transaction between market participants based upon the best use of the asset or liability at the measurement date.

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

ASC 820 establishes a three-tier

value hierarchy, which prioritizes the inputs used in measuring fair value.

820, “Fair Value Measurements and Disclosure” (“ASC 820”), defines fair value as the exchange price that would

be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or

liability in an orderly transaction between participants on the measurement date.

ASC 820 also establishes a fair value hierarchy which

requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

820 describes three levels of inputs that may be used to measure fair value.

utilizes the accounting guidance for fair value measurements and disclosures for all financial assets and liabilities and nonfinancial

assets and liabilities that are recognized or disclosed at fair value in the consolidated financial statements on a recurring basis during

the reporting period.

The fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer

a liability in an orderly transaction between market participants based upon the best use of the asset or liability at the measurement

The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability.

ASC 820 establishes

a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value.

These tiers are defined as follows:

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Inputs other than quoted prices in active markets that are either directly or indirectly observable.

3 -Unobservable inputs about which little or no market data exists, therefore requiring an entity to develop its own assumptions.

carrying value of the Company’s financial instruments including cash and cash equivalents, accounts receivable, prepaid expenses,

and accrued expenses approximate their fair value due to the short maturities of these financial instruments.

Reclassification

The Company has reclassified prior

year amounts to show the allocation of depreciation expense to cost of goods sold.

Unobservable inputs about which little or no market data exists, therefore

requiring an entity to develop its own assumptions.

The carrying value of the Company’s financial instruments including

cash and cash equivalents, accounts receivable, prepaid expenses, inventories, deferred revenue, accounts payableand accrued expenses

approximate their fair value due to the short maturities of these financial instruments.

Accounting Standards

December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes, which modifies ASC

740 to reduce complexity or improving the usefulness of the information provided to the users of financial statements.

ASU 2019-12 is

effective for annual reporting periods beginning after December 15, 2021.

The Company adopted ASU 2019-12 on February 1, 2021.

of ASU 2019-12 did not have a material impact on the Company’s consolidated financial statements.

In August 2020, the FASB issued ASU

2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity, which simplifies the guidance in U.S.

on the issuer’s accounting for convertible debt instruments.

ASU 2020-06 is effective for annual reporting periods beginning after

January 1, 2021.

2021, the FASB issued ASU 2021-08, Business Combinations (Topic805):

Accounting for Contract Assets and Contract Liabilities from Contracts

with Customers, which clarifies how to properly account for deferred revenue in a business combination.

ASU 2021-08 is effective for periods

after December 15, 2022.

The Company adopted ASU 2021-08 on February 1, 2022.

The adoption of ASU 2020-06 did not have a material impact on the

Company’s consolidated financial statements.

October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic805):

Accounting for Contract Assets and Contract Liabilities

from Contracts with Customers, which clarifies how to properly account for deferred revenue in a business combination.

ASU 2021-08 is

effective for periods after December 15, 2022.

The Company does not believe the adoption of ASU 2021-08 will have a material effect on

the Company’s consolidated financial statements.

Company has reviewed all other FASB-issued ASU accounting pronouncements and interpretations thereof that have effective dates during

the period reported and in future periods.

The Company has carefully considered the new pronouncements that alter previous GAAP and does

not believe that any new or modified principles will have a material impact on the Company’s reported financial position or operations

in the near term.

The applicability of any standard is subject to the formal review of the Company’s financial management and certain

standards are under consideration.

August 31, 2020, the Company entered into a Purchase Agreement (“Agreement”), with Pocono Coated Products (“PCP”),

pursuant to which PCP agreed to sell the Company certain of the assets and liabilities associated with its Transdermal, Topical, Cosmetic,

and Nutraceutical business, including:

(1) all the equipment, intellectual property and trade secrets, cash balances, receivables, bank

accounts and inventory, free and clear of all liens, except for certain lease obligations, and (2), a 100 % membership interest in Active

Intelligence, LLC (collectively the “Assets”).

The net assets acquired were contributed to Pocono Pharmaceuticals Inc, a

newly formed wholly owned subsidiary of the Company.

The purchase price for the Assets was (i) $ 6,085,180 paid with the issuance of 608,519

shares in the Company’s common stock of Nutriband at a value of the average price of the previous 90 days at the date of Closing

(the “Shares”), and (ii) a promissory note of the Company, net of debt discount, in the principal amount, of $ 1,332,893 (the

Note”) which is due upon the earlier of (a) twelve (12) months from issuance, or (b) immediately following a capital raise of not

less than $ 4,000,000 and/or a public offering of no less than $ 4,000,000 .

Michael Myer, the CEO of PCP, has been elected to the Board

of Directors of the Company for period of one year at the annual meeting of shareholders of the Company held in October 2020.

Agreement provides that it is effective August 31, 2020, on which date the parties also entered into an escrow agreement (the “Escrow

Agreement”), with legal counsel serving as the escrow agent, providing for holding of the Note, certificate for the shares, and

title to the Assets (held in a special purpose subsidiary) as collateral security for completion of all closing conditions under the

On that date, the parties also entered into a security agreement granting PCP a security interest in all proceeds of the Assets

held as collateral under the Escrow Agreement.

The purpose of the Company entering

into the transaction is to enhance the transdermal products operations of the Company.

The fair value of consideration given was allocated

to the net tangible assets acquired.

GAAP, both the PCP segment and Active Intelligence were considered to be businesses and,

as such, the transaction was accounted for under the acquisition method of accounting.

of the net assets acquired are as follows:

Recognized on

Common stock issued

Note payable issued

Accounts receivable

Equipment and fixtures

Customer base

Intellectual property and trademarks

Accounts payable and accrued expenses

Deferred revenue

Net assets acquired

following unaudited pro forma condensed financial information presents the combined results of operations of the Company and the two

businesses acquired from PCP, Pocono and Active Intelligence, as if the acquisition occurred as part of the beginning of cash period

The unaudited pro forma condensed financial information is not intended to represent or be indicative of the consolidated

results of operations of the Company that would have been reported had the acquisition occurred at the beginning of the period presented

and should not be taken as being representation of the future consolidated results of operations of the Company.

( 2,932,828 )

( 3,001,178 )

Loss per common share - basic and diluted

AND EQUIPMENT

The adoption of ASU 2021-08 did not have a material effect

on the Company’s consolidated financial statements.

has reviewed all other FASB-issued ASU accounting pronouncements and interpretations thereof that have effective dates during the period

reported and in future periods.

The Company has carefully considered the new pronouncements that alter previous GAAP and does not believe

that any new or modified principles will have a material impact on the Company’s reported financial position or operations in the

The applicability of any standard is subject to the formal review of the Company’s financial management and certain standards

are under consideration.

PROPERTY AND EQUIPMENT

Lab equipment

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Net Property and Equipment

Depreciation expense amounted to $ 178,924

and $ 91,338 for the years ended January 31, 2022 and 2021, respectively.

During the years ended January 31, 2022 and 2021, depreciation

expense of $ 113,000 and $ 45,000 , respectively, have been allocated to cost of goods sold.

The Company adopted the provisions of

ASC 740, “Income Taxes, (“ASC 740”).

As a result of the implementation of ASC 740, the Company recognized no adjustment

in the net liability for unrecognized income tax benefits.

The Company believes there are no potential uncertain tax positions, and all

tax returns are correct as filed.

Should the Company recognize a liability for uncertain tax positions, the Company will separately recognize

the liability for uncertain tax positions on its balance sheet.

Included in any liability or uncertain tax positions, the Company will

also setup a liability for interest and penalties.

The Company’s policy is to recognize interest and penalties related to uncertain

tax positions as a component of the current provision for income taxes.

There is no U.S.

tax provision due to

losses from U.S.

Depreciation expense amounted to $ 183,660 and $ 178,924 for

the years ended January 31, 2023 and 2022, respectively.

During the years ended January 31, 2023 and 2022, depreciation expenses of $ 139,689

and $ 113,000 , respectively, have been allocated to cost of goods sold.

adopted the provisions of ASC 740, “Income Taxes, (“ASC 740”).

As a result of the implementation of ASC 740, the Company

recognized no adjustment in the net liability for unrecognized income tax benefits.

The Company believes there are no potential uncertain

tax positions, and all tax returns are correct as filed.

Should the Company recognize a liability for uncertain tax positions, the Company

will separately recognize the liability for uncertain tax positions on its balance sheet.

Included in any liability or uncertain tax positions,

the Company will also setup a liability for interest and penalties.

The Company’s policy is to recognize interest and penalties

related to uncertain tax positions as a component of the current provision for income taxes.

tax provision due to losses from U.S.

operations for the years ended January 31, 2023 and 2022.

Deferred income taxes are provided for the temporary differences

between the financial reporting and tax basis of the Company’s assets and liabilities.

The principal item giving rise to deferred

taxes is the net operating loss carryforward in the U.S.

Valuation allowances are established when necessary to reduce deferred tax assets

to the amount expected to be realized.

The Company has set up a valuation allowance for losses for certain carryforwards that it believes

may not be realized.

provision for income taxes consists of the following:

reconciliation of taxes on income computed at the federal statutory rate to amounts provided is as follows:

Deferred income taxes are provided

for the temporary differences between the financial reporting and tax basis of the Company’s assets and liabilities.

The principal

item giving rise to deferred taxes is the net operating loss carryforward in the U.S.

Valuation allowances are established when necessary

to reduce deferred tax assets to the amount expected to be realized.

The Company has set up a valuation allowance for losses for certain

carryforwards that it believes may not be realized.

The provision

for income taxes consists of the following:

A reconciliation of taxes on income

computed at the federal statutory rate to amounts provided is as follows:

Book income (loss from operations)

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Income tax expense

of January 31, 2022, the Company recorded a deferred tax asset associated with a net operating loss (“NOL”) carryforward

of approximately $ 7,700,000 that was fully offset by a valuation allowance due to the determination that it was more likely than not

that the Company would be unable to utilize those benefits in the foreseeable future.

As of January

31, 2023, the Company recorded a deferred tax asset associated with a net operating loss (“NOL”) carryforward of approximately

$ 11,000,000 that was fully offset by a valuation allowance due to the determination that it was more likely than not that the Company

would be unable to utilize those benefits in the foreseeable future.

The Company’s NOL expires in 2040 .

effect of the valuation allowance increased by approximately $ 1,250,000 during the year ended January 31, 2022.

On December 22, 2017,

the Tax Cuts and Jobs Act (the “Tax Act”) significantly revised U.S.

corporate income tax law by, among other things, reducing

the corporate rate from 34% to 21%.

Because the Company recognizes a valuation allowance for the entire balance, there is no net impact

to the Company’s balance sheet or results of operations.

The types of temporary differences between

tax basis of assets and liabilities and their financial reporting amounts that give rise to the deferred tax liability and deferred tax

asset and their approximate tax effects are as follows:

PAYABLE/CONVERTIBLE DEBT

On March 21, 2020, the Coronavirus Aid

Relief and Economic Security Act (“CARES ACT” was enacted.

The CARES ACT established the Paycheck Protection Program (“PPP”)

which funds small businesses through federally guaranteed loans.

Under the PPP, companies are eligible for forgiveness of principal and

interest if the proceeds are used for eligible payroll costs, rent and utility costs.

On June 17, 2020, the Company’s subsidiary,

4P Therapeutics, was advanced $34,870 under the PPP, all of which was forgiven as of April 30, 2021.

The Company recorded a gain on the

extinguishment of debt of $34,870 during the year ended January 31, 2022.

The tax effect of the valuation

allowance increased by approximately $ 1,000,000 during the year ended January 31, 2023.

On December 22, 2017, the Tax Cuts and Jobs Act

(the “Tax Act”) significantly revised U.S.

corporate income tax law by, among other things, reducing the corporate rate from

Because the Company recognizes a valuation allowance for the entire balance, there is no net impact to the Company’s

balance sheet or results of operations.

types of temporary differences between tax basis of assets and liabilities and their financial reporting amounts that give rise to the

deferred tax liability and deferred tax asset and their approximate tax effects are as follows:

Net operating loss carryforward (expire through 2039)

$ ( 2,316,748 )

$ ( 1,612,724 )

Stock issued for services

( 1,299,882 )

( 1,131,114 )

Intangible impairment expense

( 1,051,714 )

Valuation allowance

Net deferred taxes

NOTES PAYABLE

Notes Payable

2020, the Coronavirus Aid Relief and Economic Security Act (“CARES ACT” was enacted.

The CARES ACT established the Paycheck

Protection Program (“PPP”) which funds small businesses through federally guaranteed loans.

Under the PPP, companies are eligible

for forgiveness of principal and interest if the proceeds are used for eligible payroll costs, rent and utility costs.

On June 17, 2020,

the Company’s subsidiary, 4P Therapeutics, was advanced $34,870 under the PPP, all of which was forgiven as of April 30, 2021.

Company recorded a gain on the extinguishment of debt of $34,870 during the year ended January 31, 2022.

July 2020, a minority shareholder made an additional loan to the Company in the amount of $ 100,000 .

The loan is interest-free and due

The loan is interest-free and

due upon demand.

In October 2021, the loan was converted into 17,182 common shares of the Company.

The shares were issued at fair market

value and no gain or loss was recorded for the transaction.

Intelligence, the Company’s newly acquired subsidiary, entered into an agreement with the Carolina Small Business Development Fund

for a line of credit of $ 160,000 due October 16, 2029, with interest of 5 % per year.

The amount assumed in Note 3 was $ 139,184 .

requires monthly payments of principal and interest of $ 1,697 .

During the year ended January 31, 2022, principal and interest payments

of $ 8,344 were forgiven under the Cares Act.

The shares were issued at fair

market value and no gain or loss was recorded for the transaction.

Active Intelligence,

the Company’s newly acquired subsidiary, entered into an agreement with the Carolina Small Business Development Fund for a line

of credit of $160,000 due October 16, 2029, with interest of 5% per year.

The amount assumed was $ 139,184 .

The loan requires monthly payments

of principal and interest of $ 1,697 .

During the year ended January 31, 2022, principal and interest payments of $ 8,344 were forgiven under

the Cares Act.

The amount, $ 8,344 , has been recorded as a gain on the forgiveness of debt.

As of January

31, 2022, the amount due was $ 115,238 , of which $ 14,119 is current.

has two finance leases secured by equipment.

During the year ended January 31, 2023, the

Company made $ 13,611 of principal payments.

As of January 31, 2023, the amount due was $ 100,627 , of which $ 15,344 is current.

2022, the Company entered into a retail installment agreement for the purchase of an automobile.

The contract price was $32,274, of which

$22,794 was financed.

The agreement is for five years bearing interest at 2.95% per annum with payments of $495 per month.

secured by automobile.

As of January 31, 2023, the amount due was $19,610 of which $4,396 is current.

two finance leases secured by equipment.

The leases mature in 2025 and 2026.

The incremental borrowing rate is 5.0 %.

The amount due

on the leases was $ 121,544 , all of which was paid during the year ended January 2022.

The amount due on

the leases was $ 121,544 , all of which was paid during the year ended January 2022.

Party Payable

On August 31, 2020, in connection with the Company’s acquisition

of Pocono Products LLC, the Company issued to Pocono Coated Products LLC a promissory note, net of debt discount, in the amount of $1,332,893

with interest accruing at an annual rate of 0.17%, due on August 28, 2021, or immediately following the earlier of a capital raise of

no less than $4,000,000 and/or a public offering of no less than $4,000,000.

Pocono Coated Products LLC, a related party, is a shareholder

of the Company.

During the nine months ended October 31, 2021, the Company recorded amortization of debt discount of $ 97,477 .

2021, the note in the amount of $ 1,500,000 was paid in full.

October 30, 2019, the Company entered into a securities purchase agreement with two investors pursuant to which the Company issued to

the investors (i) 6% one-year convertible promissory notes in the principal amount of $270,000 and (ii) three-year warrant to purchase

50,000 shares of common stock at an exercise price equal to the lesser of (i) $20.90 or (ii) if the Company completes a public offering,

110% of the initial public offering price of the common stock in the public offering.

The loans contained an original issue discount

of $20,000 resulting in gross proceeds from this financing of $250,000.

The notes are convertible at a conversion

price equal to the lesser of (i) the per share price of our common stock offered in a public offering or (ii) the variable conversion

price, which is defined as 70% of the lowest trading price of the common stock during the 20 trading days preceding the date of conversion.

The conversion price and the percentage of the trading price is subject to downward adjustment in the event the Company fails to comply

with the obligations under the notes.

The Company has the right to prepay the notes during the 180 days following the issuance of the

notes at a premium of 115% of the outstanding principal and interest during the 60 days following the date of issuance of the note, which

percentage increases to 125% during the remainder of the 180-day period.

The Company is required to pay the notes one business day after

the closing of the first to occur of (a) the next public offering of the Company’s securities or (b) the next private placement

of the Company’s equity or debt securities in which the Borrower received net proceeds of at least $1.0 million, (c) issuance of

securities pursuant to an equity line of credit or (d) a financing with a bank or other institutional lender.

embedded conversion option qualified for derivative accounting and bifurcation under ASC 815 -15 Derivative and Hedging.

fair of the conversion feature was $ 128,870 and the fair value of the warrants in connection with the notes were valued at $ 888,789 and

were recorded based on their relative fair values.

A debt discount to the note payables of $ 270,000 and an initial derivative expense

of $ 767,650 was recorded.

debt discount will be amortized over the life of the note.

Amortization of the debt discount for the year ended January 31, 2020, was

March 25, 2020, the Company prepaid the convertible notes in the principal amount of $ 270,000 from the proceeds of a private placement.

The total payments, including a prepayment fee of $ 69,131 and accrued interest, was $ 345,565 .

As a result of the payment of the notes,

the derivative liability, which was $ 928,774 as of January 31, 2020, was reduced to zero.

The warrants are no longer a derivative liability

based on the notes being paid in full.

expense for the year ended January 31, 2022, was $ 118,421 including the amortization of the debt discount of $ 97,477 and interest expense

On August 31,

2020, in connection with the Company’s acquisition of Pocono Products LLC, the Company issued to Pocono Coated Products LLC a promissory

note, net of debt discount, in the amount of $1,332,893 with interest accruing at an annual rate of 0.17%, due on August 28, 2021, or

immediately following the earlier of a capital raise of no less than $4,000,000 and/or a public offering of no less than $4,000,000.

members of Pocono Coated Products LLC, which include Mike Myer who is a related party, are shareholders of the Company.

During the three

months ended April 30, 2021, the Company recorded amortization of debt discount of $ 36,554 .

In October 2021, the note in the amount of

$ 1,500,000 was paid in full.

Interest expense for the year ended January 31, 2023, was $ 6,289 .

expense for the year ended January 31, 2022, was $ 118,421 including the amortization of debt discount of $ 97,477 and interest expense

of $ 20,944 .

Interest expense for the year ended January 31, 2021, was $ 280,686 including the amortization of debt discount of $ 272,130

and interest expense of $ 8,566 .

of January 31, 2022 and 2021, intangible assets consisted of intellectual property, customer base, license agreement and trademarks,

net of amortization, as follows:

INTANGIBLE ASSETS

As of January 31, 2023 and 2022,

intangible assets consisted of intellectual property and trademarks, customer base, and license agreement, net of amortization, as follows:

Customer base

License agreement

Intellectual property

Intellectual property and trademarks

Accumulated amortization

Net Intangible Assets

February 2021, the Company acquired an IP license for $ 50,000 , see Note 10 - “Rambam Agreement” for further discussion regarding

the license agreement.

The value of the intangible assets, consisting of intellectual property, license agreement and customer base has

been recorded at their fair value by the Company and are being amortized over a period of three to ten years .

Amortization expense for

the years ended January 31, 2022, and 2021 was $ 129,817 and $ 68,770 , respectively.

In February 2021, the Company acquired an IP license for $ 50,000 , see

Note 10- “Rambam Agreement” for further discussion regarding the license agreement.

The value of the intangible assets, consisting

of intellectual property, license agreement and customer base has been recorded at their fair value by the Company and are being amortized

over a period of three to ten years .

The Company terminated the license agreement in October 2022.

The Company issued 25,000 shares of

its common stock from its treasury shares held by the Company and warrants to purchase 25,000 shares at an exercise price of $ 7.50 per

share as part of the termination agreement.

The Company recorded a termination expense of $ 174,025 during the year ended January 31, 2023

which is included in selling and administrative expenses.

The Company expensed the balance of the agreement of $ 33,334 during the year

ended January 31, 2023, which is included in selling, general and administrative expenses.

Amortization expense for the years ended January

31, 2023, and 2022 was $ 146,483 and $ 129,817 , respectively.

Year Ended January 31,

2029 and thereafter

PARTY TRANSACTIONS

a) In connection with the acquisition of Pocono, the Company recorded various transactions and operations through Pocono Coated Products LLC, a related entity.

During the year ended January 31, 2022, the Company was advanced $ 7,862 in finance payments.

RELATED PARTY TRANSACTIONS

a) In connection with the acquisition of Pocono, the Company recorded various transactions and operations

through Pocono Coated Products LLC, of which Mike Myer was a member and a related party.

During the year ended January 31, 2022, the Company

was advanced $ 7,862 in finance payments.

As of January 31, 2022, the balance due Pocono was paid in full.

The Company also issued a note in the amount of $1,500,000 to Pocono Coated Products LLC.

The Company also issued a note

in the amount of $1,500,000 to Pocono Coated Products LLC.

In October 2021, the related party note payable was repaid.

See Note 5 for further discussion.

b) For services to the Company resulting in a listing on a National Exchange and material capital raise of no less than $ 4 million, the Company will pay the Company’s President and Chief Executive Officer a Milestone bonus of up to $ 50,000 each.

Should any transaction include a warrant clause, the President and Chief Executive Officer shall receive a further $ 50,000 bonus for every $ 2 million exercised.

For the year ended January

31, 2022, the President and Chief Executive Officer each received $ 100,000 .

c) On October 5, 2021, the Company issued 75,000 warrants for services to the Company’s CFO in connection with the Company’s IPO.

The warrants are exercisable at $ 4.90 per share and expire in three years .

The fair value of the warrants issued was $ 219,000 .

d) On October 25, 2021, the Company issued 24,642 shares, valued at $ 144,000 , for services to executive officers in connection with research and development expenses.

The shares were issued in settlement of liabilities.

e) On January 21, 2022, 163,500 options to purchase shares of the Company’s common stock were issued to executives and directors of the Company at prices of $ 4.85 and $ 5.34 per share.

See Note 5 for

further discussion.

b) In May 2022, the Company issued stock awards to the Company’s CEO and independent members of the

Board of Directors.

The CEO received 11,667 shares and the four directors received 1,167 shares each.

The Company recorded compensation

expense of $ 53,200 in connection with the issuance of the shares.

c) On August 2, 2022, options to purchase 137,084 shares of the Company’s common stock were issued

to executives of the Company at prices of $ 4.09 and $ 4.50 per share.

The options vest immediately and expire in three years .

value of the options issued for services amounted to $ 399,075 and was expensed during the year ended January 31, 2023.

d) On September 30, 2022, options to purchase 35,000 shares of the Company’s

common stock were issued to the independent directors of the Company at a price of $ 3.59 per share.

The options vest immediately and expire

in five years .

The fair value of the options issued for services amounted to $ 85,995 and was expensed during the year ended January 31,

f) During the year ended January 31, 2021, the Company issued 51,825 shares of common stock, valued at $ 777,375 , to executive officers of the Company, based on the market price at the date of issuance, and 78,500 shares of common stock, valued at $ 1,221,500 , to the Company’s current and former independent directors, based on the market price at the date of issuance.

The shares were issued on December 31, 2020, at a price of $ 15 per share.

STOCKHOLDERS’

January 15, 2016, the board of directors of the Company approved a certificate of amendment to the articles of incorporation and changed

the authorized capital stock of the Company to include and authorize 10,000,000 shares of Preferred Stock, par value $ 0.001 per share.

May 24, 2019, the board of directors created a series of preferred stock consisting of 2,500,000 shares designated as the Series A Convertible

Preferred Stock (“Series A Preferred Stock”).

On June 20, 2019, the Series A preferred Stock was terminated, and the 2,500,000

shares were restored to the status of authorized but unissued shares of Preferred Stock, without designation as to series, until such

stock is once more designated as part of a particular series by the board of directors.

June 25, 2019, the Company effected a one-for-four reverse stock splits, pursuant to which each share of common stock became converted

into 0.25 shares of common stock, and the Company decreased its authorized common stock from 100,000,000 to 25,000,000 shares.

January 27, 2020, the Company amended its articles of incorporation to increase its authorized common shares from 25,000,000 shares to

250,000,000 shares.

during the Year Ended January 31, 2022

(a) On February 25, 2021, in connection with the Company’s License Agreement with Rambam, pursuant to a Stock Purchase Agreement with BPM Inno Ltd (“BPM”), the Company issued 81,396 shares of common stock to BPM and received proceeds of $ 700,000 to be applied to product development expenses under the License Agreement.

The Company entered into the Stock Purchase Agreement with BPM in December 2020 and received a payment of $ 60,000 which is included in Stockholders’ Equity as Subscription Payable in the Company’s consolidated balance sheet as of January 31, 2021.

In February 2021, BPM advanced a payment for the Company to Rambam in the amount of $ 57,000 for the license fee.

e) On December 7, 2022, options to purchase 107,500 shares of the Company’s common stock were issued

to executives of the Company at prices of $ 3.53 and $ 3.88 per share.

The options vest immediately and expire in three years .

value of the options issued amounted to $ 245,170 and was expensed during the year ended January 31, 2023.

STOCKHOLDERS’ EQUITY

Preferred Stock

On January 15, 2016, the board of directors of the Company

approved a certificate of amendment to the articles of incorporation and changed the authorized capital stock of the Company to include

and authorize 10,000,000 shares of Preferred Stock, par value $ 0.001 per share.

On May 24, 2019, the board of directors created a series

of preferred stock consisting of 2,500,000 shares designated as the Series A Convertible Preferred Stock (“Series A Preferred Stock”).

On June 20, 2019, the Series A preferred Stock was terminated, and the 2,500,000 shares were restored to the status of authorized but

unissued shares of Preferred Stock, without designation as to series, until such stock is once more designated as part of a particular

series by the board of directors.

On June 25, 2019, the Company effected a one-for-four reverse

stock split, pursuant to which each share of common stock became converted into 0.25 shares of common stock, and the Company decreased

its authorized common stock from 100,000,000 to 25,000,000 shares.

On January 27, 2020, the Company amended its Articles of

Incorporation to increase its authorized common shares from 25,000,000 authorized shares to 250,000,000 authorized shares.

On July 26, 2022, the Company effected a 7-for-6 forward stock split

pursuant to which each shareholder of record as of the August 12, 2022, record date received one (1) additional share for each six (6)

shares held as of the record date.

On August 4, 2022, the Company amended its Articles of Incorporation

to increase its authorized common shares from 250,000,000 authorized shares to 291,666,666 authorized shares.

Activity during the Year Ended January 31, 2023

(a) In March and May 2022, the Company purchased 35,584 shares of its common

stock for $ 119,006 and recorded the purchase as Treasury Stock.

In May and December 2022, the Company issued 33,397 shares of stock awards

to management, directors and employees from the treasury shares and recorded the fair value of the compensation expense of $ 113,155 .

December 2022, the Company issued 25,000 shares from the treasury shares to non-employees in connection of the termination of the Rambam

license agreement.

As of January 31, 2023, the Company holds 10,000 of its shares comprising the $ 32,641 of treasury stock.

(b) On July 29, 2022, the Company received proceeds of $ 296,875 from the exercise of warrants and issued 55,417 shares of common stock.

See Note 10 for further

Activity during the Year Ended January

(a) On February 25, 2021, in connection with the Company’s License Agreement with Rambam, pursuant to

a Stock Purchase Agreement with BPM Inno Ltd (“BPM”), the Company issued 94,962 shares of common stock to BPM and received

proceeds of $700,000 to be applied to product development expenses under the License Agreement.

The Company entered into the Stock Purchase

Agreement with BPM in December 2020 and received a payment of $60,000 which is included in Stockholders’ Equity as Subscription

Payable in the Company’s consolidated balance sheet as of January 31, 2021.

In February 2021, BPM advanced a payment for the Company

to Rambam in the amount of $57,000 for the license fee.

The balance of the funds of $583,000 was received in February 2021.

On February 15, 2021, the Company issued 12,500 shares of common stock, valued at $ 350,000 , for consulting fees in connection with the Rambam License Agreement discussed in Note 10.

(b) On February 25, 2021, the Company issued 5,602 shares of common stock,

valued at $ 60,000 , for consulting services pursuant to a consultant agreement commencing December 1, 2020.

The Company has reflected $ 10,000

representing 934 shares as Subscription Payable in the Stockholders’ Equity in the Company’s consolidated balance sheet as

of January 31, 2021.

(c) On October 5, 2021, the Company consummated a public offering (the “IPO”) of 1,056,000 units (the “Units”), each Unit consisting of one share of common stock and one warrant (each a “Warrant”) at a price of $ 6.25 per Unit, and an additional 158,400 warrants pursuant to exercise of the underwriters’ over-allotment option.

At closing, the Company received net proceeds of $ 5,836,230 from the sale of our securities in the IPO, which include direct offering costs of $ 790,000 .

Concurrently, with the October 1, 2021 effective date of the IPO, the shares of our common stock and the Warrants sold to the public in the IPO were listed for trading on the Nasdaq Capital Market.

Each Warrant is immediately exercisable, will entitle the holder to purchase one share of common stock at an exercise price of $ 7.50 and will expire five years from the date of issuance.

The shares of common stock and Warrants are separately transferred immediately upon issuance.

(d) During the year ended January 31, 2022, the Company issued 392,396 shares of its common stock and received proceeds of $ 2,942,970 from the exercise of 392,396 public warrants.

(e) On October 22, 2021, the Company issued 17,182 shares of its common stock in exchange for the extinguishment of debt in the amount of $ 100,000 .

No gain or loss was recognized in the transaction.

See Note 5 for further discussion.

(f) On October 25,2021, the Company issued 24,642 shares, valued at $ 144,000 , for consulting services issued in connection with research and development expenses.

15, 2021, the Company issued 14,583 shares of common stock, valued at $350,000, for consulting fees in connection with the Rambam License

Agreement discussed in Note 10.

(b) On February 25, 2021, the Company issued 6,536 shares of common stock, valued at $ 60,000 , for consulting

services pursuant to a consultant agreement commencing December 1, 2020.

The Company has reflected $ 10,000 representing 1,090 shares as

Subscription Payable in the Stockholders’ Equity in the Company’s consolidated balance sheet as of January 31, 2021.

Capital Market effective October 1, 2021, consummated a public offering (the “IPO”) of units (the “Units”), of

common stock and warrants that were offered in the IPO on The Nasdaq Capital Market, which included 1,232,000 (each a “Unit”),

each Unit consisting of one share of common stock, par value $0.001 per share, and one warrant (each a “Warrant”) at a price

of $5.36 per Unit.

Each Warrant is immediate exercisable, will entitle the holder to purchase one share of common stock at an exercise

price of $6.43 and will expire five (5) years from the date of issuance.

The underwriters’ over-allotment option was exercised for

184,800 warrants to purchase shares of common stock bringing to total net proceeds to the Company from the IPO to $5,836,230.

of common stock and Warrants are separately transferred immediately upon issuance.

(d) During the year ended January 31, 2021, the Company issued 457,795

shares of its common stock and received proceeds of $ 2,942,970 from the exercise of 457,795 public warrants.

(e) On October 25, 2021, the Company issued 20,005 shares of its common stock in exchange for the extinguishment

of debt in the amount of $ 100,000 .

See Note 5 for further details.

(f) On October 25, 2021, the Company issued 28,749 shares, valued at $ 144,000 ,

for consulting services in connection with research and development expenses.

The shares were issued in settlement of liabilities.

(g) On October 5, 2021, in connection with the Company’s IPO, two former debtholders were issued an additional 72,200 warrants at an exercise price of $ 6.25 per share in accordance with the anti-dilution provision of their agreement.

The fair value of the warrants issued amounted to $ 196,589 and the Company recorded the transaction as a deemed dividend related to the warrant round down.

In October 2021, one of the former debtholders exercised the 36,100 warrants as a cashless warrant and was issued 14,869 shares of common stock.

(h) In December 2021, the Company purchased 28,125 shares of its common stock for $ 104,467 and recorded the purchase as Treasury Stock as of January 31, 2022.

(i) In January 2022, the Company issued 10,000 shares, valued at $ 66,900 , for services in connection with investor relations for the Company.

during the Year Ended January 31, 2021

March 22, 2020, the Company issued in a private placement 46,828 units at a price of $ 11 per unit.

Each unit consisted of one share of

common stock and a warrant to purchase one share of common stock at an exercise price of $ 14 per share.

The warrants expire April 30,

The Company issued a total of 46,828 shares of common stock and warrants to purchase 46,828 shares of common stock.

received proceeds of $ 515,108 .

March 2020, a minority shareholder who had previously made loans of $215,000, made an additional loan to the Company in the amount of

$60,000, increasing the loans to shareholder to $275,000.

On March 27, 2020, the Company issued 25,000 shares of common stock upon reaching

a settlement with the noteholder to convert the notes in the principal amount of $275,000.

The transaction resulted in a loss on extinguishment

June 30, 2020, the Company issued 5,000 shares to a consultant for services rendered to the Company.

The fair value of the common stock

at the date of issuance was $ 50,000 , all of which is included in selling and general administrative expense for the year ended January

August 31, 2020, the Company acquired the membership interests in Pocono Coated Products LLC and issued 608,519 shares of its common

stock, valued at $ 6,085,180 , and issued a promissory note, net of debt discount, in the amount of $ 1,332,893 .

See Note 2 for further

December 31, 2020, the Company issued 130,325 shares of common stock for services, valued at $ 1,954,875 , as follows:

(1) 51,825 shares of common stock, valued at $ 777,375 , issued to executive officers.

(2) 78,500 shares of common stock, valued at $ 1,177,500 , issued to the Company’s current and former independent directors.

The Company entered into the Stock Purchase Agreement with BPM in December 2020 and received a payment of $ 60,000 which is included in Stockholders’ Equity as Subscription in the Company’s consolidated balance sheet as of January 31, 2021.

The balance of the funds was received in February 2021.

(b) On February 25, 2021, the Company issued 5,602 shares of common stock, valued at $ 60,000 , for consulting services pursuant to a consultant agreement commencing December 1, 2020.

The Company has reflected $ 10,000 representing 934 shares as Subscription Payable in the Stockholders’ Equity in the Company’s consolidated balance sheet as of January 31, 2021.

following table summarizes the changes in warrants outstanding and the related price of the shares of the Company’s common stock

issued to non-employees of the Company.

During the year ended January 31, 2022, the Company issued 1,056,000 public warrants in connection

with its public offering, 105,600 to the underwriters in connection with its public offering, 158,400 warrants issued to the underwriters

related to the over-allotment, 125,000 (of which 75,000 were issued to the Chief Financial Officer) warrants for services and 72,200

warrants to previous convertible noteholders as additional compensation due to the warrant round down provisions of their agreement.

See Note 5 for further discussion.

a) The public warrants in the amount of 1,056,000 and underwriter warrants in the amount of 158,400 were issued on October 5, 2021.

The warrants vest immediately at an exercise price of $ 7.50 per share and expire five years from the date of issuance.

As of January 31, 2022, 822,004 warrants remain outstanding.

b) The warrants to the underwriters in the amount of 105,600 were issued on October 5, 2021.

The warrants vest on April 1, 2022, at an exercise price of $ 7.50 per share and expire three years from the date of issuance.

c) On October 21, 2021, the Company issued 125,000 warrants for services to the Company’s CFO and a service provider in connection with the Company’s IPO.

The warrants are exercisable at $ 4.90 per share and expire in three years .

As of January 31, 2022, all the warrants remain outstanding.

d) On October 5, 2021, the Company issued 72,200 warrants to previous convertible debtholders.

The warrants vest immediately at an exercise price of $ 6.25 per share and expire on October 30, 2022.

As of January 31, 2022, 36,100 warrants remain outstanding.

warrant exercise price to the previous convertible debt noteholders was adjusted to $ 6.25 for the round down provisions and the resulting

$ 196,589 of deemed dividend was recorded during the year ended January 31, 2022.

The fair value of the warrants issued for services amounted

to $ 365,000 and was recorded during the same period.

The Company used the Black- Scholes valuation model to record the fair value.

valuation model used a dividend rate of 0 %;

expected term of 1.5 years;

volatility rate of 136.19 %;

and risk-free rate of 0.10 %.

Exercise Price

Remaining Life

Intrinsic Value

(g) On October 5, 2021, in connection with the Company’s IPO, two former debtholders were issued an

additional 84,233 warrants at an exercise of $ 5.36 per share in accordance with the anti-dilution provisions of their agreement.

value of the warrants issued amounted to $ 196,589 and the Company recorded the transaction as adeemed dividend related to the warrant

In October 2021, one of the debtholders exercised 42,117 warrants as a cashless warrant and was issued 17,381 shares of common

(h) In December 2021, the Company purchased 32,813 shares of its common

stock for $ 104,467 and recorded the purchase as Treasury Stock as of January 31, 2022.

(i) In January 2022, the Company issued 11,667 shares, valued at $ 66,900

for services in connection with investor relations for the Company.

OPTIONS and WARRANTS

The following table summarizes the changes in warrants outstanding

and the related price of the shares of the Company’s common stock issued to management ( 87,500 warrants were issued to the Chief

Financial Officer) and non-employees of the Company during the year ended January 31, 2022.

The Company issued 25,000 warrants to non-employees

during the year ended January 31, 2023, in connection with the termination of the RAMBAM license agreement.

See Note 6 for further information.

Outstanding, January 31, 2021

4 unchanged sentences

Exercisable - January 31, 2023

following table summarizes additional information relating to the warrants outstanding as of January 31, 2022:

The following

table summarizes additional information relating to the warrants outstanding as of January 31, 2023:

Weighted Average

Range of Exercise

Remaining Contractual

Exercise Price for

Shares Outstanding

Shares Exercisable

following table summarizes the changes in options outstanding and the related price of the shares of the Company’s common stock

issued to employees of the Company.

November 1, 2021, The Board of Directors adopted the 2021 Employee Stock Option Plan (the “Plan”).

The Company has reserved

350,000 shares to issue and sell upon the exercise of stock options.

The options vest immediately upon issuance and expire in three years .

Under the Plan, options may be granted which are intended to qualify as Incentive Stock Options (“ISOs”) under Section 422

of the Internal Revenue Code of 1986 (the “Code”) or which are not (” non-ISOs”) intended to qualify as Incentive

Stock Options thereunder.

The Plan also provides for restricted stock awards representing shares of common stock that are issued subject

to such restrictions on transfer and other incidents of ownership and such forfeiture conditions as the board of Directors, or the committee

administering the Plan composed of directors who qualify as “independent” under Nasdaq rules, may determine.

3, 2021, the Company filed a Registration Statement on Form S-8, to register under the Securities Act of 1933, as amended the 350,000

shares of common stock reserved for issuance under the Plan.

As of January 31, 2022, 186,500 shares remain in the Plan.

January 21, 2022, 163,500 options to purchase shares of the Company’s common stock were issued to executive officers and directors

of the Company at prices of $ 4.85 and $ 5.34 per share.

The following table summarizes the changes in options outstanding and

the related price of the shares of the Company’s common stock issued to employees of the Company.

See Note 7 for the issuance of

related party options.

On November 1, 2021, the Board of Directors

adopted the 2021 Employee Stock Option Plan (the “Plan”).

The Company has reserved 408,333 shares to issue and sell upon the

exercise of stock options.

In accordance with the Plan, on February 1, 2022, the Company reserved an additional 233,333 shares.

vest and expire as determined by the Board of Directors.

Under the Plan, options may be granted which are intended to qualify as Incentive

Stock Options (“ISO’s”) under Section 422 of the Internal Revenue Code of 1986 (the “Code”) or which are

not (“non-ISO’s”) intended to qualify as Incentive Stock Options thereunder.

The Plan also provides for restricted stock

awards representing shares of common stock that are issued subject to such restrictions on transfer and other incidents of ownership and

such forfeiture conditions as the Board of Directors, or the committee administering the Plan composed of directors who qualify as “independent”

under Nasdaq rules, may determine.

On November 3, 2021, the Company filed a Registration Statement on Form S-8, to register under the

Securities Act of 1933, as amended the 408,333 shares of common stock reserved for issuance under the Plan.

As of January 31, 2023, 171,331

shares remain in the Plan.

During the year ended January 31, 2023,

279,584 options to purchase shares of the Company’s common stock were issued to executive officers and directors of the Company

at prices of $ 3.59 to $ 4.50 per share.

The options vest immediately and expire three-five years from the date of issuance.

The fair value

of the options issued for services amounted to $ 732,130 and was recorded during the year ended January 31, 2023.

The Company used the

Black-Scholes valuation model to record the fair value.

The valuation model used a dividend rate of 0 %;

expected term of 1.5 years;

rate of 152.10 - 174.45 %;

and a risk-free rate of 3 %.

On January 21, 2022, 190,751 options

to purchase shares of the Company’s common stock were issued to executive officers and directors of the Company at prices of $ 4.16

and $ 4.58 per share.

The options vest immediately and expire on January 21, 2025.

The fair value of

the options issued for services amounted to $ 532,832 and was recorded during the year ended January 31, 2022.

The Company used the Black-Scholes

valuation model to record the fair value.

The fair value of the options issued for services amounted

to $ 532,832 and was recorded during the year ended January 31, 2022.

The Company used the Black-Scholes valuation model to record the

The valuation model used a dividend rate of 0 %;

expected term of 1.5 years;

volatility rate

and risk-free rate of 1.01 %.

volatility rate of 162.69 %;

and a risk-free rate

Outstanding, January 31, 2021

4 unchanged sentences

Exercisable - January 31, 2023

following table summarizes additional information relating to the options outstanding as of January 31, 2022:

The following table summarizes additional

information relating to the options outstanding as of January 31, 2023:

Weighted Average

Range of Exercise

Remaining Contractual

Exercise Price for

Shares Outstanding

Shares Exercisable

We organize and manage our

business by the following two segments which meet the definition of reportable segments under ASC 280-10, Segment Reporting:

of Goods and Services.

These segments are based on the customer type of products or services provided and are the same as our

business units.

Separate financial information is available and regularly reviewed by our chief executive officer, who is our chief

operating decision maker, in making resource allocation decisions for our segments.

Our chief operating decision maker evaluates

segment performance to the GAAP measure of gross profit.

Sales of goods

SEGMENT REPORTING

We organize and manage our business by the following two

segments which meet the definition of reportable segments under ASC 280-10, Segment Reporting:

4P Therapeutics and Pocono Pharmaceuticals.

These segments are based

on the customer type of products or services provided and are the same as our business units.

Separate financial information is available

and regularly reviewed by our chief-decision maker, who is or chief executive officer, in making resource allocation decisions for our

Our chief-decision maker evaluates segment performance to the GAAP measure of gross profit.

Pocono Pharmaceuticals

4P Therapeutics

Pocono Pharmaceuticals

4P Therapeutics

Operating expenses

Selling, general and administrative

Research and development

Goodwill impairment

Non-Operating expenses

Interest expense

Other income (expense)

Net loss before income taxes

$ ( 6,126,126 )

$ ( 2,932,828 )

Selling, general and administrative-Pocono Pharmaceuticals

Selling, general and administrative-4P Therapeutics

Corporate overhead

Research and development-4P Therapeutics

Goodwill impairment-Pocono Pharmaceuticals

Depreciation and Amortization

Sale of goods

following table presents information about net sales and property and equipment, net of accumulated depreciation, in the United States

and elsewhere.

Pocono Pharmaceuticals

4P Therapeutics

The following table presents information about net sales and property

and equipment, net of accumulated depreciation, in the United States and elsewhere.

United States

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Outside the United States

AND CONTIGENCIES

July 27, 2018, the Company commenced an action in the Circuit Court of the Ninth Judicial Circuit in and for Orange County, Florida,

against Advanced Health Brands, Inc., Raymond Kalmar, Paul Murphy, Michelle Polly-Murphy, Laura Fillman and John Baker, together with

a Motion for Temporary Injunction Without Notice and a Motion for Prejudgment Writ of Replevin arising from the Company’s decision

to seek to rescind for misrepresentation the agreement by which the Company acquired advanced Health Brands, Inc.

for 1,250,000 shares

of common stock valued at $ 2,500,000 and seek return of the shares.

On August 2, 2018, the court entered a Temporary Injunction Without

Notice and an Order to Show Cause against the defendants.

Defendants Kalmar, Murphy, Polly-Murphy, and Baker filed a Motion to Dismiss

the Company’s Verified Complaint, Motion to Dissolve Temporary Injunction Without Notice and Response to Order to Show Cause, and

Motion to Compel Arbitration.

On January 4, 2019, the court dismissed the Company’s complaint with prejudice, and directed the

defendants to assign the Company within 30 days, the six patents never duly transferred to the Company.

On February 1, 2019, the Company

appealed the court’s order.

Pursuant to a settlement agreement with one of the defendants, that defendant returned the 50,000 shares

which had been issued to her, and the shares were cancelled as of January 31, 2019 .

On June 7, 2019, the individual defendants (other

than the defendant whom the Company has a settlement agreement), filed a motion for sanctions and civil contempt against us, which generally

claimed that we failed to comply with the Court’s January 4, 2019, order by refusing to issue the Ruling 144 letters that would

allow the defendants to transfer their shares of common stock.

On October 29, 2019, the Court denied the Defendants motion.

20, 2020, the Florida district court of appeal reversed the lower court ruling in the Florida state court action that dismissed our complaint,

with prejudice, and gave us leave to file an amended complaint.

On July 7, 2020, Defendants filed Notice for Trial, requesting the court

to set a trial date.

The Company and defendants have served their first set of interrogatories on each other and have filed answers and

responses to each other’s first set of interrogatories.

August 22, 2018, four of the defendants in the Florida action described in the previous paragraph filed a complaint against the Company

in the Franklin County, Ohio Court of Common Pleas seeking a declaratory judgment permitting them to sell the shares of common stock

they received pursuant to the acquisition agreement.

The parties have agreed to a stay pending the outcome of the Florida litigation.

April 29, 2019, the Company filed a securities fraud action in the U.S.

District Court for the Eastern District of New Yor k against

Raymond Kalmar, Paul Murphy, Michelle Polly-Murphy, Advanced Health Brands and TD Therapeutic, Inc.

In the complaint the Company alleges

that in 2017, the defendants fraudulently and deceitfully obtained 1,250,000 shares of common stock by orchestrating a months-long scheme

to defraud the Company.

The Company is seeking the return of the shares of common stock and monetary damages resulting from the defendants’

fraudulent conduct.

The defendants filed a motion to dismiss the complaint on August 23, 2019, and on September 13, 2019, the Company

filed its response.

On July 20, 2020, the Court denied the defendant’s motion to dismiss the complaint, and the parties have recently

commenced the discovery phase of the litigation.

The Court has scheduled a trial date in June 2022.

Company entered into a three-year employment agreement with Gareth Sheridan, our CEO, Serguei Melnik, our President, effective February

The agreement also provides that the executives will continue as a director.

Pocono Pharmaceuticals

4P Therapeutics

COMMITMENTS AND CONTIGENCIES

Legal Proceedings

Following a three-day trial, on July

20, 2022, the Orange County Circuit Court entered a Final Judgment in favor of Nutriband for breach of contract, replevin and rescission

to rescind in the May 22, 2017 Share Exchange Agreement involving Nutriband, Advanced Health Brands Inc., and TD Therapeutics Inc.

Court directed the return and cancellation of the 1,400,000 Nutriband shares ( adjusted for the 1-for-4 reverse stock split effective June

23, 2019 and the 7-for-6 forward stock split effective August 15, 2022 ) previously issued to Raymond Kalmar, Paul Murphy, Michelle Polly-Murphy

and John Baker.

Thereafter, by Settlement Agreement

and Release dated August 19, 2022, all parties agreed that the above-referenced Final Judgment in favor of Nutriband is binding and enforceable,

no appeal would be taken, related Ohio and New York lawsuits were dismissed and all of the original Nutriband share certificates issued

to Raymond Kalmar, Paul Murphy, Michelle Polly-Murphy and John Baker were returned to Nutriband.

The Company entered into a three-year

employment agreement with Gareth Sheridan, our CEO, and Serguei Melnik, our President, effective February 1, 2022.

The agreement also

provides that the executives will continue as a director.

The agreement provides for an initial term, commencing on the effective date

of the agreement and ending on January 31, 2025 , and continuing on a year-to-year basis thereafter unless terminated by either party on

not less than 30 days’ notice given prior to the expiration of the initial term or any one-year extension.

For their services to

the Company during the term of the agreement, Mr.

Sheridan and Mr.

Melnik will receive an annual salary of $ 250,000 per annum, commencing

on the effective date of the agreement.

Sheridan and Mr.

Melnik will also receive a performance bonus of 3.5 % of net income before

income taxes.

As of July 31, 2022, the Company and Mr.

Sheridan and Mr.

Melnik mutually agreed to reduce their annual salary to $ 150,000 .

The Company entered into a three-year

employment agreement with Gerald Goodman, our CFO, effective February 1, 2022.

The agreement provides for an initial term, commencing

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by either party on not less than 30 days’ notice given prior to the expiration of the initial term or any one-year extension.

their services to the Company during the term of the agreement, Mr.

Sheridan and Mr.

Melnik will receive an annual salary of $ 250,000

per annum, commencing on the effective date of the agreement.

Sheridan and Mr.

Melnik will also receive a performance bonus of 3.5 %

of net income before income taxes.

Company entered into a three-year employment agreement with Gerald Goodman, our CFO, effective February 1, 2022.

The agreement provides

for an initial term, commencing on the effective date of the agreement and ending on January 31, 2025, and continuing on a year-to-year

basis thereafter unless terminated by either party on not less than 30 days’ notice given prior to the expiration of the initial

term or any one-year extension.

For his services to the Company during the term of the agreement, Mr.

Goodman will receive an annual

salary of $ 210,000 per annum, commencing on the effective date of the agreement.

On December 9, 2020, the Company entered into a License Agreement (the

“License Agreement”) with Rambam Med-Tech Ltd.

(“Rambam”), Haifa, Israel, to develop the RAMBAM Closed System

Transfer Device (“CTSD”) and such other products as the parties agree to develop/commercialize.

The Company will license from

Rambam the full technology, IP, and title to CTSD in the field, with an Initial license fee of $ 50,000 and running royalties on net sales.

The $ 50,000 license fee was paid by a third party at the direction of the Company in February 2021, at which time the agreement became

As of January 31, 2022, the development of the RAMBAM CSTD Device has been suspended until further notice as preliminary reviews

and market research found the product was not commercially viable in its current form.

Company had entered into a prior agreement, dated November 13, 2020, with BPM Inno Ltd., Kiryat, Israel (“BPM”), that, in

consideration of BPM’s introduction of Rambam to the Company, provided for BPM to have the rights as the exclusive of agent of

the Company with Rambam and any other parties similarly introduced by BPM, and for a commission payable to BPM by the Company of 4.5%

of revenues received by the Company resulting from the introduction of Rambam (and any other companies as to which the exclusive agency

of BPM was in effect), and for BPM’s payment of a royalty to Rambam.

If the Company fails to commercialize the medical products

subject to the License Agreement with Rambam within 36 months, under the November 13, 2020 agreement, BPM and the Company would share

50/50 in the revenues generated from sales of the licensed products from Rambam.

This agreement further provides that it will be effective

for a period of 10 years, with either party having the right to terminate on notice given 30 days prior to the desired termination, and

also provided for certain territorial distribution rights of BPM as are set forth in the March 10, 2021 Distribution Agreement between

the Company and BPM.

As of January 31, 2022, no revenues have been earned and no royalties have been accrued.

Distribution and Stock Purchase Agreements

March 10, 2021, the Company finalized the Distribution Agreement with BPM, providing for distribution of the medical products developed

and produced under the License Agreement.

Under the Distribution Agreement, BPM has the right to distribute the medical products in Israel

and has a right of first refusal in relation to all other countries/states, other than United States, Korea, China, Vietnam, Canada and

Ecuador, which are termed excluded countries.

Drug Delivery Agreement

January 4, 2022, the Company signed a feasibility agreement with Kindeva Drug Delivery, L.P.

(“Kindeva”) to develop Nutriband’s

lead product, AVERSAL Fentanyl, based on its proprietary AVERSAL abuse deterrent transdermal technology and Kindeva’s FDA-approved

transdermal fentanyl patch (fentanyl transdermal system).

The feasibility agreement is focused on adapting Kindeva’s commercial

transdermal manufacturing process to incorporate AVERSAI technology.

agreement will remain in force until the earlier of:

his services to the Company during the term of the agreement, Mr.

Goodman will receive an annual salary of $ 210,000 per annum, commencing

on the effective date of the agreement.

As of July 31, 2022, the Company and Mr.

Goodman mutually agreed to reduce his annual salary to

Rambam Agreement

On December 9, 2020, the Company entered

into a License Agreement (the “License Agreement”) with Rambam Med-Tech Ltd.

(“Rambam”), Haifa, Israel, to develop

the RAMBAM Closed System Transfer Device (“CTSD”) and such other products as the parties agree to develop/commercialize.

Company will license from Rambam the full technology, IP, and title to CTSD in the field, with an Initial license fee of $ 50,000 and running

royalties on net sales.

The $ 50,000 license fee was paid by a third party at the direction of the Company in February 2021, at which time

the agreement became effective.

As of October 31, 2022, the development of the RAMBAM CSTD Device has been suspended until further notice

as preliminary reviews and market research found the product was not commercially viable in its current form.

As of November 11, 2022,

the Company has terminated the agreement with Rambam and all intellectual property has been returned to Rambam.

The Company had entered into a prior agreement, dated November 13,

2020, with BPM Inno Ltd., Kiryat, Israel (“BPM”), that, in consideration of BPM’s introduction of Rambam to the Company,

provided for BPM to have the rights as the exclusive of agent of the Company with Rambam and any other parties similarly introduced by

BPM, and for a commission payable to BPM by the Company of 4.5% of revenues received by the Company resulting from the introduction of

Rambam (and any other companies as to which the exclusive agency of BPM was in effect), and for BPM’s payment of a royalty to Rambam.

If the Company fails to commercialize the medical products subject to the License Agreement with Rambam within 36 months, under the November

13, 2020 agreement, BPM and the Company would share 50/50 in the revenues generated from sales of the licensed products from Rambam.

agreement further provides that it will be effective for a period of 10 years, with either party having the right to terminate on notice

given 30 days prior to the desired termination, and also provided for certain territorial distribution rights of BPM as are set forth

in the March 10, 2021 Distribution Agreement between the Company and BPM.

As of January 31, 2023, no revenues have been earned and royalties

have been accrued.

On November 22, 2022, the Company and BPM entered into a termination agreement abandoning all elements of the distribution

agreement dated January 15, 2021 between the parties.

The Company issued 25,000 shares of its common stock from its treasury shares held

by the Company and warrants to purchase 25,000 shares at an exercise price of $ 7.50 per share as part of the termination agreement.

Company recorded a termination expense in selling and administrative of approximately$ 175,000 during the year ended January 31, 2023.

BPM Distribution and Stock Purchase

On March 10, 2021, the Company finalized

the Distribution Agreement with BPM, providing for distribution of the medical products developed and produced under the License Agreement.

Under the Distribution Agreement, BPM has the right to distribute the medical products in Israel and has a right of first refusal

in relation to all other countries/states, other than United States, Korea, China, Vietnam, Canada and Ecuador, which are termed excluded

The distribution was terminated November 22, 2022.

Kindeva Drug Delivery Agreement

On January 4, 2022, the Company signed

a feasibility agreement with Kindeva Drug Delivery, L.P.

(“Kindeva”) to develop Nutriband’s lead product, AVERSAL Fentanyl,

based on its proprietary AVERSAL abuse deterrent transdermal technology and Kindeva’s FDA-approved transdermal fentanyl patch (fentanyl

transdermal system).

The feasibility agreement provides for on adapting Kindeva’s commercial transdermal manufacturing process to

incorporate AVERSAI technology in the fentanyl transdermal system.

The agreement will remain in force until

the earlier of:

(1) the completion of the work and deliverables under the Workplan;

or (2) two (2)

years after the Effective Date, after which time the agreement will expire.

or (2) two (2) years after the Effective Date, after

which time the agreement will expire.

The estimated cost to complete the feasibility Workplan is approximately

$1.7 million and the timing to complete will be between eight to twelve months.

$2.1 million and the timing to complete will be between eight to fifteen months.

Nutriband made an advance deposit of $250,000 in January

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be completed in the time estimated in the agreement.

As of January 31, 2022, no liabilities have been incurred and the deposit of $ 250,000

is included in prepaid expenses.

February 1, 2022, Pocono Pharmaceuticals, Inc.

entered into a lease agreement with Geometric Group, LLC for 12,000 square feet of warehouse

space currently occupied by Active Intelligence.

As of January 31, 2023, the Company has incurred expenses of $ 737,654 and the deposit

of $ 250,000 is included in prepaid expenses.

Lease Agreement

On February 1, 2022, Pocono Pharmaceuticals

entered into a lease agreement with Geometric Group, LLC for 12,000 square feet of warehouse space currently occupied by Active Intelligence.

The monthly rental is $ 3,000 and the lease expires on January 31, 2025 .

The lease can

be extended for an additional three years at the same monthly rental.

Subsequent to the year ended January 31, 2022, the Company purchased

22,058 shares of its common stock for $ 84,220 and recorded the transaction as Treasury Stock.

The lease can be extended for an additional three years at the

same monthly rental.

The Company recorded a Right of Use asset in the amount of $ 94,134 in connection with the valuation.

MDM Worldwide Agreement

In September 2022, the Company entered

into a public relations agreement with MDM Worldwide.

In connection with the agreement, the Company agreed to issue 20,000 options to

MDM Worldwide.

The terms of the options have not yet been agreed and the Company will issue the options when the exercise price and term

are finalized.

SUBSEQUENT EVENTS

(a) On March 19, 2023, the Company entered into a Credit Line Note agreement with TII Jet Services LDA,

a shareholder of the Company, for a credit facility of $ 2 million.

Outstanding advances under the Note bears interest at 7 % per

The promissory note is due and payable in full on March 19, 2025.

Interest is payable annually on December 31 of each year during

the term of the Note.

In March 2023, the Company was advanced $ 50,000 on the Note.

(b) On March 7, 2023, the Company issued 30,000 warrants to purchase the Company’s common shares to

Barandnic Holdings Ltd.

for services provided.

The warrants are exercisable @ $ 4.00 per share and expire five years from the date of issuance.

agreement Money Channel Inc..

The Company will pay a monthly fee and after can cancel the agreement.

The Company, after 90 days, will

also issue options to purchase 50,000 shares of common stock to at an exercise price of $ 4.00 per share to Money Channel, Inc.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS

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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 8. Financial Statements and Supplementary Data