What changed in this filing

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Item 1. Financial Statements

2023-12-13 compared with 2023-09-11 · 328 added, 234 removed, 588 unchanged (49% of the section changed)

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statements pursuant to the rules and regulations of the Securities and Exchange Commission.

The results of operations for the three and six months

ended July 31, 2023, and 2022 are not necessarily indicative of the results for the entire fiscal year or for any other period.

The results of operations for the three and nine

months ended October 31, 2023, and 2022 are not necessarily indicative of the results for the entire fiscal year or for any other period.

NUTRIBAND INC.

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Cash and cash equivalents

Accounts receivable-net

Accounts receivable

Prepaid expenses

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

7,843,150 shares issued at July 31, 2023 and January 31, 2023, 7,833,150 shares outstanding as of July 31,2023 and January 31, 2023, respectively

7,843,150 shares issued at October 31, 2023 and January 31, 2023, 7,833,150 shares outstanding as of October 31, 2023 and January 31, 2023, respectively

Additional paid-in-capital

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AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF

For the Three Months Ended

For the Six Months Ended

For the Nine Months Ended

Costs and expenses:

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( 3,565,577 )

( 2,791,644 )

Other income (expense):

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Total other expenses

Loss before provision for

Loss before provision for income taxes

( 1,759,946 )

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( 3,604,348 )

( 2,804,149 )

Provision for income taxes

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Weighted average shares of common stock outstanding - basic and diluted

Other Comprehensive Loss:

$ ( 829,173 )

$ ( 1,038,675 )

$ ( 1,844,402 )

$ ( 1,728,664 )

Foreign currency translation adjustment

Total Comprehensive Loss

$ ( 829,173 )

$ ( 1,038,675 )

$ ( 1,844,402 )

$ ( 1,728,664 )

See notes to unaudited consolidated financial statements

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STOCKHOLDERS’ EQUITY

Months Ended July 31, 2023

Nine Months Ended October 31, 2023

Comprehensive

February 1, 2023

Income (Loss)

Balance, February 1, 2023

$ ( 22,494,705 )

issued for services

loss for the six months ended July 31, 2023

Warrants issued for services

Options issued for services

Net loss for the nine months ended October 31, 2023

( 3,604,348 )

July 31, 2023

Balance, October 31, 2023

$ ( 26,099,053 )

Six Months Ended July 31, 2022

Nine Months Ended October 31, 2022

Comprehensive

February 1, 2022

Income (Loss)

Balance, February 1, 2022

$ ( 18,011,231 )

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Exercise of warrants

stock returned in settlement

Common stock returned in settlement

( 1,400,000 )

stock issued for services

stock repurchased

loss for the six months ended July 31, 2022

Treasury stock issued for services

Treasury stock repurchased

Options issued for services

Net loss for the nine months ended October 31, 2022

( 2,804,149 )

July 31, 2022

Balance, October 31, 2022

$ ( 20,815,380 )

$ ( 130,133 )

Three Months Ended July 31, 2023

Three Months Ended October 31, 2023

Comprehensive

Income (Loss)

Balance, August 1, 2023

$ ( 24,339,107 )

issued for services

loss for the three months ended July 31, 2023

July 31, 2023

Warrants issued for services

Options issued for services

Net loss for the three months ended October 31, 2023

( 1,759,946 )

Three Months Ended July 31, 2022

Comprehensive

( 1,759,946 )

Balance, October 31, 2023

$ ( 26,099,053 )

Exercise of warrants

stock returned in settlement

Three Months Ended October 31, 2022

Comprehensive

Income (Loss)

Balance, August 1, 2022

$ ( 19,739,895 )

stock issued for services

stock repurchased

loss for the three months ended July 31, 2022

$ ( 130,133 )

Options issued for services

Net loss for the three months ended October 31, 2022

( 1,075,485 )

July 31, 2022

( 1,075,485 )

Balance, October 31, 2022

$ ( 20,815,380 )

$ ( 130,133 )

See notes to unaudited consolidated financial statements

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UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF

For the Six Months Ended

For the Nine Months Ended

Cash flows from operating activities:

$ ( 3,604,348 )

$ ( 2,804,149 )

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

Depreciation and amortization

Amortization of right of use asset

Operating lease expense

Reserve for doubtful accounts

Common stock and treasury stock issued for services

Stock-based compensation-options and warrants

Treasury stock issued for services

Stock-based compensation-warrants

Stock-based compensation-options

Changes in operating assets and liabilities:

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Net Cash Used In Operating Activities

( 2,809,269 )

( 2,173,193 )

Cash flows from investing activities:

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Proceeds from note payable-related party

Proceeds from secured loan liability

Proceeds from secured borrowing liability

Proceeds from exercise of warrants

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Net Cash Provided by Financing Activities

Effect of exchange rate on cash

Net change in cash

( 2,075,550 )

Cash and cash equivalents - Beginning of period

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to Unaudited Consolidated Financial Statements

of and for the Six Months Ended July 31, 2023 and 2022

AND DESCRIPTION OF BUSINESS

of and for the Nine Months Ended October 31, 2023 and 2022

ORGANIZATION AND DESCRIPTION

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

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Financial Statements

consolidated balance sheet as of July 31, 2023, and the consolidated statements of operations and comprehensive loss, stockholders’

consolidated balance sheet as of October 31, 2023, and the consolidated statements of operations and comprehensive loss, stockholders’

equity, and cash flows for the periods presented have been prepared by the Company and are unaudited.

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changes in stockholders’ equity and cash flows for all periods presented have been made.

The results for the six months ended July

31, 2023, are not necessarily indicative of the results to be expected for the full year.

The consolidated financial statements should

be read in conjunction with the consolidated financial statements and footnotes thereto included in Nutriband’s Annual Report on

Form 10-K for the year ended January 31, 2023.

The results for the nine months ended

October 31, 2023, are not necessarily indicative of the results to be expected for the full year.

The consolidated financial statements

should be read in conjunction with the consolidated financial statements and footnotes thereto included in Nutriband’s Annual Report

on Form 10-K for the year ended January 31, 2023.

information and footnote disclosures required under generally accepted accounting principles in the United States of America (“U.S.

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Company’s significant accounting policies in Note 2 in the Company’s Annual Report on Form 10-K for the year ended January

There were no significant changes to these accounting policies during the six months ended July 31, 2023.

There were no significant changes to these accounting policies during the nine months ended October 31, 2023.

July 26, 2022, our Board of Directors approved the amendment to our Articles of Incorporation to effect a 7 for 6 forward stock split

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

31, 2023, the Company had cash and cash equivalents of $ 2,334,553 and working capital of $ 2,399,446 .

For the six months ended July 31,

2023, the Company incurred an operating loss of $ 1,884,402 and used cash flow from operations of $ 1,744,999 .

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 .

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 with a

related party, amended on July 13, 2023 to $ 5,000,000 , which will permit the Company to draw down on the credit line to fund the Company’s

research and development of its Aversa product.

As of July 31, 2023, the Company was advanced $ 2,000,000 .

As of October 31, 2023, the Company had cash and cash equivalents of $ 1,265,323

and working capital of $ 1,281,963 .

For the nine months ended October 31, 2023, the Company incurred a loss from operations of $ 3,565,577

and used cash flow from operations of $ 2,809,269 .

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

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 with a related party, amended on July 13, 2023 to $ 5,000,000 , which will

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

As of October

31, 2023, the Company was advanced $ 2,000,000 .

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

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and Cash Equivalents

Cash and cash

equivalents include cash on hand, cash on deposit and money market accounts.

The Company considers short-term highly liquid investments

with an original maturity date of three months or less that are not part of an investment pool to be cash equivalents.

As of July 31,

2023, the Company’s balances of approximately $ 1.47 million exceeded federally insured limits.

Cash and cash equivalents

include cash on hand, cash on deposit and money market accounts.

The Company considers short-term highly liquid investments with an original

maturity date of three months or less that are not part of an investment pool to be cash equivalents.

As of October 31, 2023, the Company’s

balances of approximately $ 0.5 million exceeded federally insured limits.

May 2014, the FASB issued ASU No.

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See the tables:

Six Months Ended

Nine Months Ended

Three Months Ended

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Sale of goods

Six Months Ended

Nine Months Ended

Three Months Ended

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United States

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 six months

ended July 31, 2023 and 2022, the Company recorded bad debt expense of $ 11,836 and $- 0 -, respectively, for doubtful accounts related to

accounts receivable.

During the six months ended July 31, 2023, the Company entered into an assignment agreement to sell account receivable

for one of its subsidiaries.

The Company received $ 106,528 in funds against an account receivable of $ 118,675 of 4P Therapeutics that

is currently a claim in bankruptcy.

4P Therapeutics recorded a bad debt expense of $ 11,836 against the receivable.

The net accounts receivable

remain on the books of the Company and a corresponding amount has been included as a secured loan payable.

The account receivable of $ 118,365

is collateralized to secure liability.

If the bankruptcy claim is not paid in full by the debtor, the Company is obligated to pay any

difference to the factor.

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

estimating credit losses on current accounts by

evaluating actual historical losses.

For the nine months ended October 31, 2023 and 2022, the Company recorded bad debt expense of $ 11,836 and $- 0 -, respectively, for doubtful

accounts related to accounts receivable.

During the nine months ended October 31, 2023, the Company entered into an accounts receivable

sale agreement for one of its subsidiaries.

The Company received $ 106,528 in funds against an account receivable that is currently a

claim in bankruptcy.

The net accounts receivable remain on the books of the Company and a corresponding amount has been included as a

secured borrowing liability under Notes payable.

If the bankruptcy claim is not paid in full by the debtor, the Company is obligated

to pay any difference to the factor.

The secured borrowing liability bears interest at 10 %.

The bankruptcy claim has not yet been settled

by the bankruptcy court.

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

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normal operating capacity).

As of July 31, 2023, total inventory was $ 156,921 , consisting of work-in-process of $ 34,467 and raw materials

As of October 31, 2023, total inventory was $ 174,641 , consisting of work-in-process of $ 30,089 and raw materials

of $ 144,552 .

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Lab Equipment

and equipment

Machinery and equipment

10 - 20 years

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

As of July 31, 2023 and

January 31, 2023, Goodwill amounted to $ 5,021,713 and $ 5,021,713 , respectively.

As of October 31, 2023

and January 31, 2023, Goodwill amounted to $ 5,021,713 and $ 5,021,713 , 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.

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

stock and potential shares of common stock outstanding during the period.

Potential shares of common stock consist of shares issuable

upon the exercise of outstanding options and common stock purchase warrants.

As of July 31, 2023, and 2022, there were 1,783,373 and 1,570,954

common stock equivalents outstanding, that were not included in the calculation of dilutive earnings per share as their effect would be

anti-dilutive.

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.

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

of common stock and potential shares of common stock outstanding during the period.

Potential shares of common stock consist of

shares issuable upon the exercise of outstanding options and common stock purchase warrants.

As of October 31, 2023, and 2022, there

were 2,157,873 and 1,645,506 common stock equivalents outstanding, that were not included in the calculation of dilutive earnings per

share as their effect would be anti-dilutive.

“Compensation - Stock Compensation,” prescribes accounting and reporting standards for all share-based payment

transactions in which employee services, and, since February 1, 2019, non-employees, are acquired.

Transactions include incurring

liabilities, or issuing or offering to issue shares, options and other equity instruments such as employee stock ownership plans and

stock appreciation rights.

Share-based payments to employees, including grants of employee stock options, are recognized as

compensation expense in the financial statements based on their fair values.

That expense is recognized over the period during which

an employee is required to provide services in exchange for the award, known as the requisite service period (usually the vesting

As of February 1, 2019, pursuant to ASC 2018-07, ASC 718 was applied to stock-based compensation for both employees and

non-employees.

Transactions include

incurring liabilities, or issuing or offering to issue shares, options and other equity instruments such as employee stock ownership

plans and stock appreciation rights.

Share-based payments to employees, including grants of employee stock options, are recognized

as compensation expense in the financial statements based on their fair values.

That expense is recognized over the period during

which an employee is required to provide services in exchange for the award, known as the requisite service period (usually the

vesting period).

As of February 1, 2019, pursuant to ASC 2018-07, ASC 718 was applied to stock-based compensation for both employees

and non-employees.

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

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recognition guidance.

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

Company applies 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.

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These tiers are defined as follows:

Observable inputs such as quoted

market prices in active markets.

Inputs other than quoted prices in active markets

that are either directly or indirectly observable.

Unobservable inputs about which little or no market

data exists, therefore requiring an entity to develop its own assumptions.

Level 1 - Observable inputs such as quoted market prices in active

Level 2 - Inputs other than quoted prices in active markets that are either directly or indirectly

Level 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 accounts receivable, prepaid expenses, accounts payable and accrued

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Net Property and Equipment

expenses amounted to $ 93,936 and $ 91,237 for the six months ended July 31, 2023 and 2022, respectively.

During the six months ended July

31, 2023 and 2022, depreciation expenses of $ 72,445 and $ 69,845 , respectively, have been allocated to cost of goods sold.

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.

expenses amounted to $ 133,520 and $ 137,730 for the nine months ended October 31, 2023 and 2022, respectively.

During the nine months

ended October 31, 2023 and 2022, depreciation expenses of $ 101,315 and $ 104,767 , respectively, have been allocated to cost of goods sold.

Active Intelligence

entered into an agreement with the Carolina Small Business Development Fund for a line of credit of $ 160,000 due October 16, 2028, 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 six months ended July 31, 2023, the Company made $ 7,983 of principal

As of July 31, 2023, the amount due was $ 93,021 , of which $ 15,725 is current.

April 3, 2022, the Company entered into a retail installment agreement for the purchase of an automobile.

The contract price was $32,274,

of which $22,795 was financed.

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

the nine months ended October 31, 2023, the Company made $ 11,460 of principal payments.

As of October 31, 2023, the amount due was $ 89,160 ,

of which $ 15,928 is current.

On April 3, 2022,

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

The contract price was $32,274, of which $22,795

was financed.

The agreement is for five years bearing interest at 2.95% per annum with payments of $410 per month.

loan is secured by automobile.

As of July 31, 2023, the amount due was $17,424 of which $4,456 is current.

2023, the Company entered into an amended Credit Line Note agreement, for an increased $ 5,000,000 credit line facility Note, with TII

Jet Services LDA, a shareholder of the Company (replacing the $ 2,000,000 facility with the same lender that the Company entered into

on March 17, 2023).

The loan is secured

by automobile.

As of October 31, 2023, the amount due was $16,235 of which $4,456 is current.

payable-related party

July 17, 2023, the Company entered into an amended Credit Line Note agreement, for an increased $ 5,000,000 credit line facility Note,

with TII Jet Services LDA, a shareholder of the Company (replacing the $ 2,000,000 facility with the same lender that the Company entered

into on March 17, 2023).

Outstanding advances under the Note bears interest at 7 % per annum.

The promissory note is due and payable in full

on July 31, 2026.

The promissory note is due and payable in

full on March 19, 2026.

Interest is payable annually on December 31 of each year during the term of the note.

During the six months ended July

31,2023, the Company was advanced $ 2,000,000 on the Note.

The Company recorded interest expense of $ 7,002 for the six months ended July

During the nine months

ended October 31, 2023, the Company was advanced $ 2,000,000 on the Note.

The Company recorded interest expense of $ 42,012 for the nine

months ended October 31, 2023.

borrowing liability

2023, 4P Therapeutics assigned its claim under the bankruptcy proceedings from Sorrento Therapeutics Inc.

and received proceeds of $ 106,528 .

The amount due under claim was $ 118,675 and 4P Therapeutics recorded a bad debt expense of $ 11,836 during the six months ended July 31,

Under the agreement with the buyer of the claim, 4P Therapeutics will make proportional restitution and/or repayment of the purchase

amount to the extent the claim is disallowed, reduced or not paid at the same time or distribution rate as other general unsecured claims

against the Debtor are paid.

The Company has recorded the amount of the proceeds as a secured loan payable to the buyer as of July 31,

Any amounts not paid by the Debtor on the claim will bear 10 % interest to be paid by 4P Therapeutics.

See Note 2 for further information.

expenses for the six months ended July 31, 2023 and 2022, were $ 12,401 and $ 8,539 , respectively.

of July 31, 2023 and January 31 2023, intangible assets consisted of intellectual property and trademarks, customer base, and license

The Company entered

into an accounts receivable sale agreement for one of its subsidiaries in connection with a bankruptcy claim.

The Company received $ 106,528

and recorded the transaction as a secured loan payable against the account receivable.

If the claim is not paid in full by the debtor,

the Company will pay any difference to the factor.

The loan bears interest at 10 %.

For the nine months ended October 31, 2023, the Company

recorded interest expense of $ 2,835 .

The bankruptcy claim has not yet been settled by the bankruptcy court.

expenses for the nine months ended October 31, 2023 and 2022, were $ 52,601 and $ 12,505 , respectively.

of October 31, 2023 and January 31 2023, intangible assets consisted of intellectual property and trademarks, customer base, and license

agreement, net of amortization, as follows:

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Net Intangible Assets

expenses for the six months ended July 31, 2023, and 2022 was $ 56,575 and $ 64,909 , respectively.

expenses for the nine months ended October 31, 2023, and 2022 amounted to $ 84,862 and $ 118,195 , respectively.

Year Ended January 31,

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The options vest immediately and expire in three years .

The fair value of the options issued for services amounted to $ 75,030 and was expensed during the six months ended July 31, 2023.

b) On July 17, 2023, the Company entered into an amended Credit Line Note facility with TII Jet Services LDA, a shareholder of the Company, for a credit facility of $ 5 million (replacing the $ 2,000,000 facility with the same lender that the Company entered into on March 17, 2023).

The fair value of the options issued for services amounted to $ 75,030 and was expensed during the nine months ended October 31, 2023.

b) In September and October 2023, options to purchase 374,500 shares of common stock to executives and directors of the Company at a price of $ 1.93 , $ 2.12 and $ 2.65 per share.

The options vest immediately and expire in three years .

The fair value of the options issued amounted to $ 424,826 and was expensed during the nine months ended October 31, 2023.

c) On October 31, 2023, warrants to purchase 87,500 shares of the Company’s common stock were issued to the Chief Financial Officer at a price of $ 1.93 per share.

The warrant expires in three years .

The fair value of the warrants issued amounted to $ 93,450 and was expensed during the nine months ended October 31, 2023.

d) On July 17, 2023, the Company entered into an amended Credit Line Note facility with TII Jet Services LDA, a shareholder of the Company, for a credit facility of $ 5 million (replacing the $ 2,000,000 facility with the same lender that the Company entered into on March 17, 2023).

See Note 4 for further information.

TII Jet Services LDA is owned 100 % by a shareholder of the Company.

c) In May 2022, the Company issued stock awards to the Company’s CEO and the independent members of the Board of Directors.

e) In May 2022, the Company issued stock awards to the Company’s CEO and the 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 a compensation expense of $ 53,200 in connection with the issuance of the shares.

f) On August 2, 2022, 137,084 options to purchase 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 .

The fair value of the options issued for services amounted to $ 329,691 and was expensed during the nine months ended October 31, 2022.

g) On September 30, 2022, 35,000 options to purchase 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 three years .

The fair value of the options issued for services amounted to $ 75,530 and was expensed during the nine months ended October 21, 2022.

STOCKHOLDERS’

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shares in connection with the forward split.

during the Six Months Ended July 31, 2023

(a) As of July 30, 2023, the Company holds 10,000 of its shares comprising $ 32,641 of treasury stock.

There was no activity during the six months ended July 31, 2023.

Activity during the Six Months Ended July 31, 2022

during the Nine Months Ended October 31, 2023

(a) As of October 31, 2023, the Company holds 10,000 of its shares comprising $ 32,641 of treasury stock.

There was no activity during the nine months ended October 31, 2023.

during the Nine Months Ended October 31, 2022

(a) In March and May 2022, the Company purchased 35,583 shares of its common stock for $ 118,766 and recorded the purchase as Treasury Stock.

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See Note 9 for further information.

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 six months ended July 31, 2023.

On March 7, 2023, the Company issued 30,000 warrants

to purchase the Company’s common shares to Barandic Holdings Ltd.

The 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 nine months ended October 31, 2023.

On March 7, 2023, the Company issued 30,000 warrants to purchase the Company’s common

shares to Barandic Holdings Ltd.

for services provided.

The warrants are exercisable at a price of $ 4.00 per share and expire five years

from the date of issuance.

On October 27, 2023, the Company issued 145,833 warrants to purchase the Company’s common shares to management

( 87,500 warrants were issued to the Chief Financial Officer) and non-employees of the Company.

The warrants are exercisable at a price

of $ 4.00 per share and expire five years from the date of issuance.

of $ 1.93 per share and expire in three years from the date of issuance.

These warrants replace previously issued warrants that have now

been cancelled.

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

The valuation model used a dividend rate

expected term of 1.5 years;

volatility rate of 152.10 - 174.45 %;

and a risk-free rate of 3 %.

For the nine months ended October 31,

2023, the Company recorded non-cash compensation of $ 242,840 .

See Note 6 for further information.

Outstanding, January 31, 2022

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Expired/Cancelled

Outstanding- July 31, 2023

Exercisable - July 31, 2023

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

Outstanding - October 31, 2023

Exercisable - October 31, 2023

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

Range of Exercise Prices

Number Outstanding

Weighted Average Remaining Contractual Life(Years)

Weighted Average

Remaining Contractual Life(Years)

Weighted Average Exercise Price for Shares Outstanding

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

As of July 31, 2023, 374,666 shares remain in the

the six months ended July 31, 2023, 30,000 options to purchase shares of the Company’s common stock were issued to an executive

officer at a price of $ 3.975 per share.

As of October 31, 2023, 166 shares remain in the

the nine months ended October 31, 2023, 404,500 options to purchase shares of the Company’s common stock were issued to executive

officers and employees at prices of $ 1.93 -$ 3.975 per share.

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

The fair value

of the options issued for services amounted to $ 75,030 and was recorded during the six months ended July 31, 2023.

The Company used the

Black-Scholes valuation model to record the fair value.

The fair value of the options issued for services amounted to $ 499,856 and was recorded during the nine months ended October 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 143.54 %;

term of 1.5 years;

volatility rates of 121.52 - 143.54 %;

and a risk-free rate of 3.00 - 4.5 %.

12 unchanged sentences

Expired/Cancelled

Outstanding- July 31, 2023

Exercisable - July 31, 2023

following table summarizes additional information relating to the options outstanding as of July 31, 2023:

Outstanding - October 31, 2023

Exercisable - October 31, 2023

following table summarizes additional information relating to the options outstanding as of October 31, 2023:

Range of Exercise Prices

Number Outstanding

Remaining Contractual Life(Years)

Exercise Price for Shares Outstanding

Weighted Average Remaining Contractual Life(Years)

Weighted Average Exercise Price for Shares Outstanding

Number Exercisable

Exercise Price for Shares Exercisable

Weighted Average Exercise Price for Shares Exercisable

Intrinsic Value

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the GAAP measure of gross profit.

Pharmaceuticals

general and administrative-Pocono Pharmaceuticals

general and administrative-4P Therapeutics

general and administrative-Corporate

and development-4P Therapeutics

and Amortization

Pharmaceuticals

Nine Months Ended

Three Months Ended

Pocono Pharmaceuticals

4P Therapeutics

Pocono Pharmaceuticals

4P Therapeutics

Operating expenses

Selling, general and administrative-Pocono Pharmaceuticals

Selling, general and administrative-4P Therapeutics

Selling, general and administrative-Corporate

Research and development-4P Therapeutics

Depreciation and Amortization

Pocono Pharmaceuticals

4P Therapeutics

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

and elsewhere.

Six Months Ended

Nine Months Ended

Three Months Ended

the United States

United States

Outside the United States

Property and equipment, net of accumulated depreciation

the United States

Pharmaceuticals

United States

Outside the United States

Pocono Pharmaceuticals

4P Therapeutics

AND CONTIGENCIES

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

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

The agreement also provides that the executives will continue as directors.

The agreement provides for an initial term, commencing

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transdermal fentanyl patch (fentanyl transdermal system).

The feasibility agreement provides for on adapting Kindeva’s commercial

The feasibility agreement provides for adapting Kindeva’s commercial

transdermal manufacturing process to incorporate AVERSAI technology in the fentanyl transdermal system.

3 unchanged sentences

years after the Effective Date, after which time the agreement will expire.

The estimated cost to complete the feasibility

Workplan is approximately $ 2.3 million and the timing to complete will be between eight to fifteen months.

Nutriband made an advance deposit

of $ 250,000 in January 2022, to be applied against the final invoice.

The Workplan has commenced in February 2022, and the parties believe

the Workplan will be completed in the time estimated in the agreement.

As of July 31, 2023, the Company has incurred expenses of $ 1,510,000

and the deposit of $ 250,000 is included in prepaid expenses.

estimated cost to complete the feasibility Workplan is approximately $ 2.1 million and the time to complete will be between eight to fifteen

Nutriband made an advance deposit of $ 250,000 in January 2022, to be applied against the final invoice.

The Workplan commenced

in February 2022, and the parties believe the Workplan will be completed in the time estimated in the agreement.

As of October 31, 2023,

the Company has incurred expenses of $ 1,849,371 and the deposit of $ 250,000 is included in prepaid expenses.

February 1, 2022, Pocono Pharmaceuticals entered into a lease agreement with Geometric Group, LLC for 12,000 square feet of warehouse

9 unchanged sentences

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.

For the six months ended July 31, 2023, the Company paid MDM Worldwide $ 60,000 .

In October 2023, the contract was mutually terminated, and no options were issued.

the nine months ended October 31, 2023, the Company paid MDM Worldwide $ 210,000 .

Channel Agreement

7 unchanged sentences

No options were issued.

For the six months ended July 31, 2023, the Company paid the Money Channel $ 100,000 .

For the nine months ended October 31, 2023, the Company paid the Money Channel $ 100,000 .

Therapeutics, Inc.

July 25, 2023, 4P Therapeutics assigned its claim under the bankruptcy proceedings from Sorrento Therapeutics Inc.

and received proceeds

of $ 106,528 .

The amount due under the claim was $ 118,675 and 4P Therapeutics recorded a bad debt expense of $ 11,836 during the nine months

ended October 31, 2023.

Under the agreement with the buyer of the claim, 4P Therapeutics will make proportional restitution and/or repayment

of the purchase amount to the extent the claim is disallowed, reduced or not paid at the same time or distribution rate as other general

unsecured claims against the Debtor are paid.

The Company has recorded the amount of the proceeds as a secured loan payable to the factor

as of October 31, 2023.

May 24, 2023, the Company sent notice of the termination of the Securities Facility Services Agreement, dated January 3, 2023, by and

between MERJ DEP Ltd.

And the Company (“Agreement”), which provided for the dual listing of the Company’s common stock

And the Company (“Agreement”), witch provided for the dual listing of the Company’s common stock

on the MERJ Upstream exchange (“Upstream”), which is operated as a fully registered and licensed integrated securities exchange,

2 unchanged sentences

May 31, 2023.

From time to time, the Company is a party to various lawsuits,

claims and other legal proceedings that arise in the ordinary course of business.

When the Company becomes aware of a claim or potential

claim, it assesses the likelihood of any loss or exposure.

respect to legal proceedings that arise in the ordinary course of business, when the Company becomes aware of a claim or potential claim,

it assesses the likelihood of any loss or exposure.

In accordance with authoritative guidance, the Company records loss contingencies

in its financial statements only for matters in which losses are probable and can be reasonably estimated.

The Company is currently involved in a dispute with Joseph

Gunnar regarding fees related to our cancellation of the offering that we believe was justified.

Should litigation be commenced, the outcome of this legal

proceeding is uncertain at this point because of the many questions of fact and law that may arise and based on information available

September 21, 2023, we were served with a complaint (the “Complaint”) filed in the Supreme Court of the State of New York,

County of New York, Commercial Division (the “Court”) under Index Number 654633/2023, by Joseph Gunnar, LLC, an investment

broker-dealer located in New York City (“Gunnar”), and Lucosky Brookman LLP, the attorneys for Gunnar during the relevant

period (collectively the “Plaintiffs”), suing the Company, Gareth Sheridan (our CEO and a director), Serguei Melnik, (our President

and a director),Vitalie Botgros (a stockholder of the Company), TII Jet Services LDA (an aircraft leasing firm, “Jet Services”)

and Wolf Blitz, Inc.

(a consulting company, “Wolf Blitz”), collectively the “Defendants”.

Complaint alleges, in multiple counts, damages resulting from the Company’s termination in or about July 2023 of an April 6, 2023

engagement letter between Gunnar and the Company, (the “Engagement Letter”), that contemplated a public offering of our common

stock to be underwritten and sold by Gunnar as the sole underwriter.

Subsequently, the Company, due to market conditions and prior to

executing an underwriting agreement or similar commitment as to the terms of the offering with Gunnar, declined to proceed with the offering

and accordingly terminated the Engagement Agreement in July 2023.

Complaint alleges claims for damages against:

(1) the Company, Gareth Sheridan and Serguei Melnik (the “Company Defendants”)

for breach of contract due to the Company’s failure to proceed with the offering;

(2) the Company Defendants for fraudulently inducing

Gunnar to enter into the Engagement Letter;

(3) the Company Defendants for fraudulent statements made in connection with the contemplated

(4) the Company Defendants for fraudulent concealment of pursuit of alternative financing during the engagement period under

the Engagement Letter;

(5) Jet Services, Vitalie Botgros and Wolf Blitz for tortious interference resulting from discussions concerning

alternative financing during the engagement period;

(6) Jet Services, Vitalie Botgros, and Wolf Blitz for tortious interference with

a prospective business opportunity;

(7) the Company Defendants for negligent misrepresentation;

and (8) against the Defendants other

than Jet Services for promissory estoppel as to promises purportedly made to complete the offering.

Gunnar seeks an award of actual and compensatory damages in an amount exceeding $ 500,000 , as well as exemplary and punitive damages,

while Lucosky Brookman LLP seeks attorneys’ fees, costs and expenses pursuant to indemnification obligations under the Engagement

Additionally,

the Company believes the Engagement Letter is unenforceable and, even if enforceable, was properly terminated by the Company under the

terms of the Engagement Letter and the market conditions under which the Engagement Letter was terminated.

or about November 2, 2023, legal counsel for the Company filed an Answer, Affirmative Defenses and Counterclaims with the Court in response

to the Complaint.

The Company vigorously denied the claims asserted against it and asserted the following counterclaims with their Answer:

Intentional interference with prospective economic advantage, consumer fraud, breach of fiduciary duty, breach of contract (damages in

the amount of $ 1,000,000 were requested on each of the preceding counterclaims) and a declaratory judgment affirming that Gunnar’s

actions constituted gross negligence or willful misconduct, and the Company’s termination of the Engagement Letter on such grounds

was proper pursuant to its terms.

have denied the allegations surrounding the Company’s counterclaims and asserted their own affirmative defenses against the counterclaims

and argue that they have the right to be reimbursed for attorneys’ fees, costs and expenses incurred in responding to the counterclaims.

The outcome of the legal

proceedings is uncertain at this point because of the many questions of fact and law that may arise and based on information available

to the Company at present, it cannot reasonably estimate a range of loss for this action.

However, at present we are not aware of any actions of the Company

which we believe would individually or in the aggregate materially adversely affect our business, consolidated results of operations,

financial position, or cash flows.

The Company has asserted counterclaims exceeding

the claims of the Plaintiffs.

Management, in consultation

with legal counsel, has determined that it is “reasonably possible” that some of the claims may ultimately result in a loss

to the Company.

However, at this time, Management believes that any amount of any possible loss (damages), if any, will not have a material

effect on the Company’s consolidated statement of financial position or statement of operations.

As of October 31, 2023, the Company

has not accrued any amount for possible loss.

Company has evaluated subsequent events through the filing of this Quarterly Report on Form 10-Q and determined there have been no events

that have occurred that would require adjustment to our disclosures in the consolidated financial statements.

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

What changed 10-Q

Item 1. Financial Statements