What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-12-14 compared with 2022-06-14 · 129 added, 177 removed, 95 unchanged (76% of the section changed)

10 unchanged sentences

identifying words.

We have based these forward-looking statements

on our current expectations and projections about future events.

We have based these forward-looking statements on

our current expectations and projections about future events.

Although we believe that the expectations underlying our forward-looking

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channels, including third parties.

We are developing potentially life-saving technologies:

We plan to develop potentially life-saving technologies:

the CardioMap® heart monitoring and screening

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We intend to establish agreements with distributors to get products to market quickly,

as well as to undertake and engage in our own direct marketing efforts.

We will determine the most effective method of distribution for

each unique product that we include in our portfolio.

We will engage third-party research and development firms who specialize in the

creation of our products to assist us in the development of our own products, and we will apply for trademarks and patents once we have

developed proprietary products.

as well as to undertake and engage in our own direct marketing efforts effort as we move closer to regulatory approvals.

We will determine

the most effective method of distribution for each unique product that we include in our portfolio.

We will engage third-party research

and development firms who specialize in the creation of our products to assist us in the development of our own products, and we will

apply for trademarks and patents once we have developed proprietary products.

Recent Funding

Private Placement

On February 2, 2022, we entered into an agreement

to raise money through a private investment in a public entity.

We offered up to 14,285,714 Units (the “Units”), each Unit

consisting of one share of our common stock (the “Share”) and one-half of an accompanying warrant (the “Investor Warrants”)

exercisable for one share of our common stock.

The Units will be sold at a price of $0.35 per Unit (the “Offering”).

To date, we have issued a total of 4,058,372 Units

for gross proceeds to us of $1,420,430.

No additional sales will be made pursuant to this agreement.

See Notes 10 and 13 of Notes to Financial Statements

for additional information.

2022, we received a donation in the amount of $500,000 in partnership with the Erase PTSD Now organization and the Glenn Greenberg and

Linda Vester Foundation.

These funds were recorded as Other income in our Statements of Operations and will be used to progress the Phase

1 human clinical trials for drug candidate PRV-002 for the treatment of concussion

Promissory Notes

On December 21, 2021,

and December 22, 2021, we entered into a total of five Promissory Notes (the “Notes”) with three of our directors and two

Joseph Michael Redmond,

President and Chief Executive Officer, Ms.

Farrell, Chief Financial Officer, Mr.

Casey, Director, Mr.

Director, and Mr.

Richardson, Director, each loaned us $25,000 for total proceeds of $125,000.

The Notes bear interest at 8%

per annum and are due March 31, 2022.

The notes have been extended to September 30, 2022.

LPC Securities Purchase Agreement

On October 22, 2021, we entered into a Securities

Purchase Agreement (the “SPA”) with Lincoln Park Capital Fund, LLC (“LPC”) pursuant to which we received $250,000

in cash from LPC and LPC received (i) 1,500,000 restricted shares of our common stock, and (ii) 833,333 warrants exercisable at $0.50

per common share expiring in five years.

Mast Hill Fund L.P.

On December 13, 2022, we entered into a Securities Purchase Agreement

(the “SPA”) with Mast Hill Fund, L.P.

(“Mast Hill”).

Pursuant to the SPA, we sold Mast Hill (i) an $870,000 face

value, one-year, 10% per annum Promissory Note convertible into shares of our common stock at $0.12 per share, (ii) a five-year share

purchase warrant entitling Mast Hill to acquire 2,000,000 shares of our common stock at $0.20 per share (the “Warrant”), and

(iii) a five-year warrant for 4,000,000 shares of our common stock at $0.20 per share issuable in the event of default.

Net proceeds after

original discount, fees and expenses, was $723,868.

LPC Purchase Agreement Draws

During the nine months ended April 30, 2022, LPC

During the three months ended October 31, 2022, LPC

purchased a total of 1,133,591 shares of our common stock for total proceeds of $240,710 pursuant to the August 14, 2020, LPC Purchase

As of April 30, 2022, LPC had purchased a total of 4,121,610 shares of our common stock for total proceeds of $1,938,711 and

remaining purchase availability was $8,311,289 and remaining shares available were 15,943,556.

Tysadco Partners

On August 29, 2021, we entered into a Securities

Purchase Agreement (the “SPA”) with Tysadco Partners (“Tysadco”) pursuant to which we entered into a $250,000

face value convertible promissory note which bears interest at a one-time rate of 8.0% applied to the face value and had an original maturity

date of March 1, 2022.

We received $250,000 net cash from the issuance of the promissory note and issued 200,000 shares of common stock

with a fair value of $17,718 which is being expensed over the life of the note as a component of interest expense.

The conversion rate

of the note is $0.30 for a total of 900,000 shares of our common stock if converted in full, including interest.

On March 31, 2022, the SPA was amended to extend

the maturity date to March 1, 2023, and, as consideration, $25,000 was added to the principal.

On October 18, 2021, we entered into a Securities

Purchase Agreement with Tysadco pursuant to which we received $250,000 in cash from Tysadco and Tysadco received (i) 1,500,000 restricted

shares of our common stock, and (ii) 833,333 warrants exercisable at $0.50 per common share expiring in five years.

Subsequent to October 31, 2022, LPC purchased an additional 1,100,000 shares for total proceeds of $200,320 and, as of December

14, 2022, LPC had purchased a total of 5,982,518 shares of our common stock for total proceeds of $2,461,296 and the remaining purchase

availability was $7,788,704 and the remaining shares available were 13,288,846.

Promissory Note

On September 21, 2022, we entered into a promissory

note for $30,000 with a consultant for investor relations services with an interest rate of 8% per annum and a due date of December 31,

Going Concern

See Note 1 of Notes to Financial Statements.

We did not recognize any revenues for the year ended

July 31, 2022, or the three months ended October 31, 2022, and we had an accumulated deficit of $56,327,534 as of October 31, 2022.

the foreseeable future, we expect to experience continuing operating losses and negative cash flows from operations.

Cash available at

October 31, 2022, of $50,499 may not provide enough working capital to meet our current operating expenses through December 14, 2023.

The operating deficit indicates substantial doubt

about our ability to continue as a going concern.

Our continued existence depends on the success of our efforts to raise additional capital

necessary to meet our obligations as they come due and to obtain sufficient capital to execute our business plan.

We may obtain capital

primarily through issuances of debt or equity or entering into collaborative arrangements with corporate partners.

There can be no assurance

that we will be successful in completing additional financing or collaboration transactions or, if financing is available, that it can

be obtained on commercially reasonable terms.

If we are not able to obtain the additional financing on a timely basis, we may be required

to further scale down or perhaps even cease operations.

The issuance of additional equity securities could

result in a significant dilution in the equity interests of our current stockholders.

Obtaining commercial loans, assuming those loans

would be available, would increase our liabilities and future cash commitments.

Our financial statements do not include adjustments that

might result from the outcome of this uncertainty.

If we are unable to raise additional capital by December

14, 2023, we will adjust our business plan.

Due to the unknown and volatile nature of the stock price and trading volume of our common

stock, is it is difficult to predict the timing and amount of availability pursuant to our equity line of credit with LPC.

Given our recurring

losses, negative cash flow, accumulated deficit and the impact of COVID-19, there is substantial doubt about our ability to continue as

a going concern.

Impact of COVID-19

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The COVID-19 outbreak has adversely affected the U.S.

and global economies and financial

markets, which may result in a long-term economic downturn that could negatively affect future performance and our ability to secure additional

debt or equity funding.

Significant Accounting Policies and Use of

During the nine months ended April 30, 2022, there

were no significant changes to our significant accounting policies and estimates are described in Note 2.

and global economies and financial markets, which

may result in a long-term economic downturn that could negatively affect future performance and our ability to secure additional debt

or equity funding.

Significant Accounting Policies and Use of Estimates

During the three months ended October 31, 2022, there

were no significant changes to our significant accounting policies and estimates as described in Note 2.

Summary of Significant Accounting

1 unchanged sentence

of our Annual Report on Form 10-K for the year ended July 31, 2022, which was filed with the

Securities and Exchange Commission on October 29, 2021.

SEC on October 31, 2022.

Results of Operations

We do not currently sell or market any products

and we did not have any revenue in the three or nine-month periods ended April 30, 2022 or 2021.

We will commence actively marketing products

after the products and drugs in development have been FDA cleared or approved, but there can be no assurance, however, that we will be

successful in obtaining FDA clearance or approval for our products.

Three Months Ended April 30,

Nine Months Ended April 30,

Research and development

We do not currently sell or market any products and

we did not have any revenue in the three-month periods ended October 31, 2022 or 2021.

We will commence actively marketing products after

the products and drugs in development have been FDA cleared or approved, but there can be no assurance, however, that we will be successful

in obtaining FDA clearance or approval for our products.

Three Months Ended

Research and development expense

General and administrative expense

In-process research and development

Loss from operations

(12,094,320 )

(13,253,380 )

Interest expense

Other income (expense), net

Net loss and comprehensive loss

$ (3,099,271 )

$ (12,401,690 )

Other expense, net

$ (2,149,580 )

1 unchanged sentence

Basic and diluted net loss per share

Shares used for basic and diluted net loss per share

Research and Development Expense

Our Research and development expense includes

expenses related to our current projects and include, clinical research, design and manufacturing, formulation, regulatory and consultants.

Our Research and development expense includes expenses

related to our current projects and include, clinical research, design and manufacturing, formulation, regulatory and consultants.

Three months ended

April 30, 2022

October 31, 2022

three months ended

April 30, 2021

Nine months ended

April 30, 2022

nine months ended

April 30, 2021

October 31, 2021

Increase (decrease) in:

Drug development

Phase 1 clinical trial

Phase I clinical trial

Australian research and development rebate

Prototype phase

The decrease in consultants for the three months

ended April 30, 2022, compared to the same period of the prior year was the result of the completion of several phases of research and

development related primarily to PRV-002.

The decrease in drug development expenses for

the three months ended April 30, 2022, compared to the same period of the prior year was the result of completion of initial drug development

for PRV-002 in the second quarter of fiscal 2022.

The increases in Phase I clinical trial expenses

for the three and nine months ended April 30, 2022, compared to the same periods of the prior year were the result of increased study costs

as the trial progresses.

The decrease in prototype phase expenses for the

three months ended April 30, 2022, compared to the same period of the prior year was the result of completion of Phase 1 prototype costs

for the PRV-002 device used in the clinical trials in the second quarter of fiscal 2022.

The increases in consultants, drug development

and Phase 1 clinical trial expense for the nine months ended April 30, 2022, compared to the same period of the prior year were the result

of expenses incurred to develop the drug and start the Phase 1 clinical trial with PRV-002.

The decreases in drug development, consultants and

prototype phase were the result of the completion of the development of the concussion drug in the fourth quarter of fiscal 2022.

increase in Phase I clinical trial relates to our concussion drug device trial.

General and Administrative Expense

Our General and administrative expense includes

salaries and related benefits for employees in finance, accounting, sales, administrative and research and development activities, as

well as stock-based compensation, costs related to maintaining compliance as a public company and legal and professional fees.

Our general and administrative expense includes salaries

and related benefits for employees in finance, accounting, sales, administrative and research and development activities, as well as stock-based

compensation, costs related to maintaining compliance as a public company and legal and professional fees.

The changes in General and administrative expense

1 unchanged sentence

Three months ended

April 30, 2022

three months ended

April 30, 2021

Nine months ended

April 30, 2022

nine months ended

April 30, 2021

October 31, 2022

October 31, 2021

Increase (decrease) in:

5 unchanged sentences

Legal and professional fees

The increases in business development and investor

relations in both periods related to the 3,000,000 shares of our common stock with a value of $1,610,000 issued to a consultant for investor

relations, partially offset by decreases in non-recurring investor relations expense.

The decrease in board and stock expense for the

three months ended April 30, 2022, compared to the same period of the prior year was due to the lower price of our common stock on the

date grants were issued, resulting in lower stock-based compensation.

The decrease in wages for the three months ended

April 30, 2022, compared to the same period of the prior year was due to a $20,000 signing bonus issued in the prior year quarter.

The increase in board and stock expense for the

nine months ended April 30, 2022, compared to the same period of the prior year was due to the higher price of our common stock on the

date grants were issued, resulting in higher stock-based compensation.

The increase in wages in the nine-month period

ended April 30, 2022, compared to the same period of the prior year was due to bonuses totaling $400,000 granted to our executive officers

in the 2022 period and additional employees hired in the third quarter of 2021.

In-Process Research and Development

In-process research and development in the three

and nine month periods ended April 30, 2021, related to the Prevacus Asset Purchase Agreement that closed on March 1, 2021.

The increase in board and stock expense and business

development and investor relations was due to the granting of stock and stock options to the board, officers, employees and consultants.

Interest Expense

Interest expense includes interest on debt outstanding,

as well as the amortization of unamortized debt issuance costs and debt closing costs.

Certain information regarding debt outstanding

was as follows:

Three Months Ended April 30,

Nine Months Ended April 30,

as well as the amortization of unamortized beneficial conversion feature, debt issuance costs and debt closing costs.

Certain information

regarding debt outstanding was as follows:

Three Months Ended October 31,

Weighted average debt outstanding

Weighted average interest rate

The increases in interest expense for the three

and nine-month periods ended April 30, 2022, compared to the same periods of 2021 were due to LGH and Tysadco notes issued in April 2021

and October 2021 and amended in February and March 2022, respectively, and the issuance of promissory notes in December 2021.

Other Income, net

Other income, net in the nine-month period ended

April 30, 2022, includes a donation in the amount of $500,000 in partnership with the Erase PTSD

Now organization and the Glenn Greenberg and Linda Vester Foundation and foreign exchange gains and losses related to invoices

denominated and paid in foreign currencies.

Other income, net in the 2021 periods represents the forgiveness of our SBA Paycheck Protection

Program Loan.

Net loss decreased in the three and nine months

ended April 30, 2022, compared to the same periods of the prior year due to the in-process research and development charge in the prior

year periods, partially offset by increased research and development expense, general and administrative expense and interest expense

in the current year periods as discussed above.

The increase in the weighted average debt outstanding

was due to the addition of principal to both the LGH and Tysadco notes in exchange for extending the maturity date of the notes.

we issued a $30,000 promissory note during the first quarter of fiscal 2023.

The decrease in the weighted average interest rate

was due to the extension of maturity dates on the LGH and Tysadco notes that have flat interest rates.

Net loss increased in the three-month period ended

October 31, 2022 compared to the same period of 2021 primarily due to increased stock-based compensation.

Liquidity and Capital Resources

See Recent Funding above for a discussion of our recent debt and equity

The following table sets forth the primary sources and uses of cash:

Nine Months Ended April 30,

Three Months Ended October 31,

Net cash used in operating activities

$ (1,165,210 )

$ (2,461,232 )

Net cash used in investing activities

1 unchanged sentence

To date, we have financed our operations primarily

through debt financing and sales of our common stock.

Our ability to continue to access capital could be affected adversely by various

factors, including general market and other economic conditions, interest rates, the perception of our potential future earnings and cash

distributions, any unwillingness on the part of lenders to make loans to us and any deterioration in the financial position of lenders

that might make them unable to meet their obligations to us.

If these conditions continue and we cannot raise funds through a public or

private debt financing, or an equity offering, our ability to grow our business may be negatively affected.

In such case, we may need

to suspend the creation of new products until market conditions improve.

Cash used in investing activities in the first

nine months of fiscal 2022 were for a patent related to our PRV-002 drug device combination.

through debt financing and limited sales of our common stock.

Our ability to continue to access capital could be affected adversely by

various factors, including general market and other economic conditions, interest rates, the perception of our potential future earnings

and cash distributions, any unwillingness on the part of lenders to make loans to us and any deterioration in the financial position of

lenders that might make them unable to meet their obligations to us.

If these conditions continue and we cannot raise funds through a

public or private debt financing, or an equity offering, our ability to grow our business may be negatively affected.

In such case, we

may need to suspend the creation of new products until market conditions improve.

The following notes payable were outstanding:

April 30, 2022

Convertible note issued to LGH due May 31, 2022 with a fixed interest rate of 8.0% over the term of the note (annual interest rate of 12.1%) and convertible at $1.00 per share

Promissory notes issued to officers and directors due September

30, 2022 with a fixed interest rate of 8.0% per annum (see Note 13)

Tysadco convertible promissory note payable due March 1, 2023 with a fixed interest rate of 8.0% over the term of the note (annual interest rate of 15.2%) and convertible at $0.30 per share

October 31, 2022

July 31, 2022

Convertible note issued to LGH due December 31, 2022 with a flat interest rate of 8.0% of the original principal of $1,050,000 and convertible at $0.20 per share

Promissory notes issued to officers and directors due December 31, 2022 with a fixed interest rate of 8.0% per annum (see Note 10)

Promissory note with an interest rate of 8% per annum due December 31, 2022

Tysadco convertible promissory note payable due March 1, 2022 with a flat interest rate of 8.0% of the original principal of $250,000 and convertible at $0.30 per share

Unamortized debt discount and closing costs

Inflation did not have a material impact on our

business and results of operations during the periods being reported on.

Australian Research and Development Rebate

In the first quarter of fiscal 2023, we incurred $663,436

of expenses related to our Phase I clinical trial of our concussion drug device combination that are eligible for the Australian research

and development rebate for a rebate due of $322,671, which was recorded as an offset to research and development expense during the quarter

ended October 31, 2022.

On November 18, 2022, we received a research and development

rebate from the government of Australia in the amount of $313,709 for clinical work performed in Australia related to our Phase I human

clinical trial during the fiscal year ended July 31, 2022.

On December 8, 2022, we received a goods and service

tax refund, which was accrued as part of our research and development rebate due from the Australian government, in the amount of $82,705

related to our Phase I human clinical trial during July, August and September 2022.

Inflation did not have a material impact on our business

and results of operations during the periods being reported on.

Off Balance Sheet Arrangements

We do not have any material off balance sheet

arrangements.

We do not have any material off balance sheet arrangements.

Quantitative and Qualitative Disclosures About Market Risk

We are a smaller reporting company and are not required to provide

information under this item.

We are a smaller reporting company and are not required to provide information

under this item.

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 2. Management’s Discussion and Analysis