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Item 2. Management’s Discussion and Analysis

2023-11-13 compared with 2023-05-09 · 258 added, 294 removed, 84 unchanged (87% of the section changed)

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Forward-Looking Statements

This Quarterly Report on Form

10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other

Federal securities laws, and is subject to the safe-harbor created by such Act and laws.

Forward-looking statements may include statements

regarding our goals, beliefs, strategies, objectives, plans, including product and technology developments, future financial conditions,

results or projections or current expectations.

In some cases, you can identify forward-looking statements by terminology such as “may,”

“will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,”

“estimate,” “predict,” “potential” or “continue,” the negative of such terms, or other

variations thereon or comparable terminology.

These statements are merely predictions and therefore inherently subject to known and unknown

risks, uncertainties, assumptions and other factors that may cause actual results, performance levels of activity, or our achievements,

or industry results to be materially different from those contemplated by the forward-looking statements.

Such forward-looking statements

appear in this Item 2 – “Management’s Discussion and Analysis of Financial Condition and Results of Operations,”

and may appear elsewhere in this Quarterly Report on Form 10-Q and include, but are not limited to, statements regarding the following:

the expected development and potential benefits from our products in regenerative medicine, biologics and food tech, as well as potentially in other industries and verticals that have a need for our mass scale and cost-effective cell expansion platform;

the prospects of entering into additional license agreements, or other forms of cooperation with other companies, research organizations and medical institutions, including, without limitation Tnuva (as defined below);

our pre-clinical and clinical study plans, including timing of initiation, expansion, enrollment, results, and conclusion of trials;

achieving regulatory approvals;

receipt of future funding from the Israel Innovation Authority, or IIA, the European Union’s Horizon programs, as well as grants from other independent third parties;

developing capabilities for new clinical indications of placenta expanded, or PLX, cells and new products;

our expectation to demonstrate a real-world impact and value from our pipeline, technology platform and commercial-scale manufacturing capacity;

the possible impacts of cybersecurity incidents on our business and operations;

our expectations regarding our short- and long-term capital requirements;

our outlook for the coming months and future periods, including but not limited to our expectations regarding future revenue and expenses;

information with respect to any other plans and strategies for our business;

our expectations regarding the impact of the COVID-19 pandemic, including

on our clinical trials and operations;

the Israeli government is currently pursuing extensive changes to Israel’s judicial system, which may negatively impact the business environment in Israel with reluctance for investments or transactions as well as lead to increased currency fluctuations, downgrades in credit rating and increased interest rates.

This Quarterly Report on

Form 10-Q contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and

other Federal securities laws, and is subject to the safe-harbor created by such Act and laws.

Forward-looking statements may include

statements regarding our goals, beliefs, strategies, objectives, plans, including product and technology developments, future financial

conditions, results or projections or current expectations.

In some cases, you can identify forward-looking statements by terminology

such as “may,” “will,” “should,” “expect,” “intend,” “plan,”

“anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,”

the negative of such terms, or other variations thereon or comparable terminology.

These statements are merely predictions and therefore

inherently subject to known and unknown risks, uncertainties, assumptions , and

other factors that may cause actual results, performance levels of activity, or our achievements, or industry results to be materially

different from those contemplated by the forward-looking statements.

Such forward-looking statements appear in this Item 2 – “Management’s

Discussion and Analysis of Financial Condition and Results of Operations,” and may appear elsewhere in this Quarterly Report on

Form 10-Q and include, but are not limited to, statements regarding the following:

expected development and potential benefits from our products in regenerative medicine, biologics

and food technology, or food tech, as well as potentially in other industries and verticals

that have a need for our mass scale and cost-effective cell expansion platform;

prospects of entering into additional license agreements, or other forms of cooperation with

other companies, research organizations and medical institutions, including, without limitation

Tnuva (as defined below);

pre-clinical and clinical study plans, including timing of initiation, expansion, enrollment,

results, and conclusion of trials;

regulatory approvals;

of future funding from the Israel Innovation Authority, or IIA, the European Union’s

Horizon programs, the National Institutes of Health, or NIH, as well as grants from

other independent third parties;

capabilities for new clinical indications of placenta expanded, or PLX, cells and new products;

expectation to demonstrate a real-world impact and value from our pipeline, technology platform

and commercial-scale manufacturing capacity;

possible impacts of cybersecurity incidents on our business and operations;

expectations regarding our short- and long-term capital requirements;

outlook for the coming months and future periods, including but not limited to our expectations

regarding future revenue and expenses;

● information

with respect to any other plans and strategies for our business;

Israeli government is pursuing extensive changes to Israel’s judicial system, which

may negatively impact the business environment in Israel with reluctance for investments

or transactions as well as lead to increased currency fluctuations, downgrades in credit

rating and increased interest rates;

market, political and economic conditions in the countries in which we operate including

those related to recent unrest and actual or potential armed conflict in Israel and other

parts of the Middle East, such as the recent attack by Hamas and other terrorist organizations

from the Gaza Strip and Israel’s war against them.

Our business and operations

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In addition, historic results

of scientific research, clinical and preclinical trials do not guarantee that the conclusions of future research or trials would not suggest

different conclusions.

Also, historic results referred to in this periodic report would be interpreted differently in light of additional

research, clinical and preclinical trials results.

Except as required by law, we undertake no obligation to release publicly the result

of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect

the occurrence of unanticipated events.

Further information on potential factors that could affect our business is described under the

heading “Risk Factors” in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended June 30, 2022, or the

2022 Annual Report, as well as Item 1A of this Quarterly Report.

Readers are also urged to carefully review and consider the various disclosures

we have made in that report.

As used in this Quarterly Report on Form 10-Q, the terms “we”,

“us”, “our”, the “Company” and “Pluri” mean Pluri Inc.

and our wholly owned subsidiaries,

Pluri Biotech Ltd.

and Pluristem GmbH, and our subsidiary Ever After Foods Ltd., or Ever After, formerly known as Plurinuva Ltd., unless

otherwise indicated or as otherwise required by the context.

of scientific research and development, clinical and preclinical trials do not guarantee that the conclusions of future research and

development or trials would not suggest different conclusions.

Also, historic results referred to in this periodic report would be interpreted

differently in light of additional research, development, clinical and preclinical trials results.

Except as required by law, we undertake

no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or

circumstances after the date hereof or to reflect the occurrence of unanticipated events.

Further information on potential factors that

could affect our business is described under the heading “Risk Factors” in Part I, Item 1A, of our Annual Report on Form

10-K for the fiscal year ended June 30, 2023, or the 2023 Annual Report, as well as Item 1A of this Quarterly Report.

Readers are also

urged to carefully review and consider the various disclosures we have made in that report.

As used in this Quarterly

Report on Form 10-Q, the terms “we”, “us”, “our”, the “Company” and “Pluri”

mean Pluri Inc.

and our wholly owned subsidiaries, Pluri Biotech Ltd.

and Pluristem GmbH, and our subsidiary Ever After Foods Ltd., or

Ever After, unless otherwise indicated or as otherwise required by the context.

We are a biotechnology company

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of inflammatory, muscle injuries and hematologic conditions.

Our placental expanded, or PLX, cells are adherent stromal cells that are

expanded using our 3D platform.

Our PLX cells can be administered to patients off-the-shelf, without blood or tissue matching or

additional manipulation prior to administration.

PLX cells are believed to release a range of therapeutic proteins in response to the

patient’s condition.

Our PLX cells are adherent stromal cells that are expanded using our 3D

Our PLX cells can be administered to patients off-the-shelf, without blood or tissue matching or additional manipulation

prior to administration.

PLX cells are believed to release a range of therapeutic proteins in response to the patient’s condition.

Our operations are focused

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in Israel Ltd., through its fully owned subsidiary, Tnuva Food-Tech Incubator (2019), Limited Partnership, or Tnuva, to use our technology

to establish a cultivated food platform and the recent collaboration agreement we signed with a leading European manufacturer of active

pharmaceutical ingredients, or APIs, to use our expansion technology, which aims to revolutionize the production of biologics by enabling

a cost-effective, sustainable and cruelty-free ingredient.

We expect to demonstrate a

real-world impact and value from our cell-based technology platform, our current PLX pipeline and from other cell-based product candidates

that may be developed based on our platform.

Our business model for commercialization and revenue generation includes, but is not limited

to, licensing deals, joint ventures, partnerships, joint development agreements and direct sale of our products.

In the pharmaceutical area, we

have focused on a number of indications utilizing our product candidates, including, but not limited to, muscle recovery following surgery

to establish a cultivated food platform, as well as a collaboration agreement we signed in 2022 with a leading European manufacturer

of active pharmaceutical ingredients, or APIs, to use our expansion technology, which aims to revolutionize the production of biologics

by enabling a cost-effective, sustainable and cruelty-free ingredient.

In the pharmaceutical area,

we have focused on several indications utilizing our product candidates, including, but not limited to, muscle recovery following surgery

for hip fracture, incomplete recovery following bone marrow transplantation, critical limb ischemia, or CLI, Chronic Graft versus Host

Disease and a potential treatment for Acute Radiation Syndrome.

Some of these studies have been completed while others are still ongoing.

Disease and a potential treatment for Hematopoietic Acute Radiation Syndrome, or H-ARS.

Some of these studies have been completed while

others are still ongoing.

We believe that each of these indications is a severe unmet medical need.

In April 2023, we unveiled a breakthrough in cell manufacturing

that potentially solves one of the biggest hurdles facing cell-based industries:

cost-effective, industrial scale cell

manufacturing.

PluriMatrix, built upon our platform 3D cell expansion technology, significantly scales high-quality cell production,

potentially having a catalytic impact across numerous industries that require mass-scale cell production including pharma,

biologics, foodtech and agri-tech.PluriMatrix is also used by our majority-owned subsidiary Ever After, to produce cultivated meat

On February 24, 2022, we announced

the closing of the joint venture pursuant to joint venture agreement, or the Joint Venture Agreement, with Tnuva through the Subsidiary.

Under the Joint Venture Agreement, we established a new company, Ever After, with the purpose of developing cultivated meat products of

all types and kinds.

Pursuant to the Joint Venture

Agreement, Tnuva entered into a share purchase agreement, or the SPA, with Ever After and the Subsidiary, pursuant to which Ever After

issued on the closing date of the SPA, or the Closing Date, 187,500 ordinary shares, representing 15.79% of its share capital, to Tnuva,

as well as a warrant to purchase additional shares of Ever After, in consideration of an aggregate of $7.5 million in cash.

In December 2022, we reported

that our joint venture successfully completed proof of concept in its development of cultivated meat based on our cell-based technology

Technology Collaboration the Biologics Field

In September 2022, we entered into a collaboration agreement with a

leading European manufacturer of APIs for liver and gastroenterological diseases, or API Collaboration.

As part of our collaboration,

our platform is being utilized to develop and manufacture a unique biologic API used in drugs that treat liver and gastroenterological

The current source of this API is derived from animals that are sacrificed during the extraction process.

The joint goal of

the collaboration is to grow the specific cells needed for this API in our 3D cell expansion bioreactor systems that secrete the biological

molecule without harming animals.

As of March 31, 2023 we recorded revenues of $160,000 relates to API Collaboration.

We believe that proof of concept

with this agreement and APIs will open opportunities for us to serve additional API manufacturers in the rapidly growing biologics market.

RESULTS OF OPERATIONS – THREE AND NINE

MONTHS ENDED MARCH 31, 2023 COMPARED TO THREE AND NINE MONTHS ENDED MARCH 31, 2022.

Revenues for each of the nine-month and three-month periods ended March

31, 2023 were $176,000 and $87,000, respectively, as compared to $234,000 in revenues during the nine-month and three-month periods ended

March 31, 2022.

Revenues for the nine-month and three-month periods ended March 31, 2023 were mainly related to our API Collaboration.

In July 2023, we announced

that we signed a three year $4.2 million contract with the U.S.

National Institute of Allergy and Infectious Diseases, or NIAID, which

is part of the NIH.

Under such contract, we will collaborate with the U.S.

Department of Defense’s Armed Forces Radiobiology Research

Institute, or AFRRI, and the Uniformed Services University of Health Sciences, or USUHS, in Maryland, U.S.A., to further advance the

development of our PLX-R18 cell therapy as a potential novel treatment for H-ARS, a deadly disease that can result from nuclear disasters

and radiation exposure.

On January 5, 2022, we signed

definitive collaboration agreements with Tnuva through the Subsidiary.

Under the definitive collaboration agreements, or the Joint Venture

Agreement, we established a new company, Ever After, with the purpose of developing cultivated meat products of all types and kinds.

Ever After is engaged in the development, manufacturing and commercialization of technology, know-how and products that will be based

on licensed products relating to the field of cultivated meat.

Our joint venture successfully

completed proof of concept in its development of cultivated meat based on our cell-based technology platform.

Ever After is also using

PluriMatrix for producing cultivated meat.

RESULTS OF OPERATIONS – THREE MONTHS

ENDED SEPTEMBER 30, 2023 COMPARED TO THREE MONTHS ENDED SEPTEMBER 30, 2022.

Revenues for the three-month

period ended September 30, 2023 were $54,000 as compared to $87,000 in revenues during the three-month period ended September 30, 2022.

Revenues for the three-month period ended September 30, 2023 were mainly related to services provided in the field of process and product

Revenues for the three-month period ended September 30, 2022 were mainly related to our collaboration in the biologic field.

Research and Development Expenses, Net

Research and development, or R&D, expense, net (costs less participation

by the IIA, Horizon 2020, Horizon Europe and other parties) for the nine-month period ended March 31, 2023 decreased by 36% from $19,016,000

for the nine-month period ended March 31, 2022 to $12,223,000.

Research and development, or R&D, expenses, net (costs less participation

by the IIA, Horizon 2020, Horizon Europe and the NIAID) for the three-month period ended September 30, 2023 decreased by 30% from $4,270,000

for the three-month period ended September 30, 2022 to $2,993,000.

The decrease is mainly attributed to:

(1) a decrease in clinical studies

subcontractor expenses following the completion of our critical limb ischemia and ARDS associated with COVID-19 studies and the end of

enrollment of our muscle regeneration following hip fracture study in November 2021, (2) a decrease in materials purchases in accordance

with our manufacturing needs and plan, (3) a decrease in salaries and related expenses as part of our efficiency cost-reduction plan,

specifically a reduction of 29 R&D employees (107 on March 31, 2023, compared to 136 on March 31, 2022), (4) a decrease in share-based

compensation expenses and (5) higher participation by the European Union with respect to the Horizon 2020 grants, which relate to our

critical limb ischemia and muscle regeneration following hip fracture studies.

R&D expense, net (costs less participation by the IIA, Horizon

2020, Horizon Europe and other parties) for the three-month period ended March 31, 2023 decreased by 32% from $6,156,000 for the three-month

period ended March 31, 2022 to $4,167,000.

The decrease is mainly attributed to:

(1) a decrease in clinical studies subcontractor expenses

following the completion of our critical limb ischemia and ARDS associated with COVID-19 studies and the end of enrollment of our muscle

regeneration following hip fracture study in November 2021, (2) a decrease in salaries and related expenses as part of our efficiency

cost reduction plan, specifically a reduction of 29 R&D employees (107 on March 31, 2023, compared to 136 on March 31, 2022) and (3)

a decrease in share-based compensation expenses.

expenses following the completion of our CLI, COVID-19 and muscle regeneration following hip fracture studies, and (2) a decrease in salaries

and related expenses due to the exchange rate differences related to the strength of the U.S.

dollar against the NIS and a reduction in

head count of 10 R&D employees (99 on September 30, 2023, compared to 109 on September 30, 2022), partially offset by (3) increased

participation of the NIAID related to the H-ARS contract which commenced in fiscal year 2024.

General and Administrative Expenses

General and administrative expenses for the nine-month period ended

March 31, 2023 decreased by 38% from $13,929,000 for the nine-month period ended March 31, 2022 to $8,655,000.

The decrease is mainly

attributed to a decrease in share-based compensation expenses related to market based vesting conditioned restricted stock units, or RSUs,

granted to our Chief Executive Officer and Chairman which was recorded as an expense of $7,283,000 between September 11, 2020 and

October 30, 2021, decrease in share-based compensation expenses related to allocation of shares of Ever After to our Chief Executive Officer,

Chief Financial Officer and Chairman of our board of directors pursuant to their employment or consulting agreement, employee terminations

and RSU expenses amortization over time.

Offset by an increase in share-based compensation expenses related to the amount of RSUs granted

to employees.

General and administrative expenses for the three-month period ended

March 31, 2023 decreased by 34% from $4,553,000 for the three-month period ended March 31, 2022 to $3,020,000.

The decrease is mainly

attributed to a decrease in share-based compensation expenses related to allocation of shares of Ever After to our Chief Executive Officer,

Chief Financial Officer and chairman of our board of directors pursuant to their employment or consulting agreement, offset by an increase

in share-based compensation expenses related to the amount of RSUs granted to employees.

Other Financial Income (Expenses), net

Other financial income (expenses) decreased from $1,097,000 in financial

income for the nine-month period ended March 31, 2022 to $956,000 in financial expenses for the nine-month period ended March 31, 2023.

This decrease is mainly attributable to expenses relating to exchange rate differences related to the EIB loan provided to us in June

2021 pursuant to the finance agreement executed with the EIB, or the EIB Finance Agreement.

During the nine-month period ended March 31,

2023, the strength of the Euro against the U.S.

dollar, increased by 4% compared to a decrease of 6% during the nine-month period ended

March 31, 2022.

Other financial income (expenses) decreased from $780,000 in financial

income for the three-month period ended March 31, 2022 to $441,000 in financial expenses for the three-month period ended March 31, 2023.

This decrease is mainly attributable to expenses from exchange rate differences related to the EIB loan provided to us in June 2021 pursuant

to the EIB Finance Agreement.

During the three-month period ended March 31, 2023, the strength of the Euro against the U.S.

dollar, increased

by 2% compared to a decrease of 2% during the three-month period ended March 31, 2022.

September 30, 2023 decreased by 11% from $2,740,000 for the three-month period ended September 30, 2022 to $2,438,000 mainly due to:

a decrease in salaries and related expenses due to the exchange rate differences relates to the strength of the U.S.

dollar against the

NIS (2) the reduction of our CEO’s salary, whereby he waived 50% of his salary and converted it to restricted stock units, or RSUs,

and options, and (3) a decrease in costs relates to our directors and officers insurance policy.

Other Financial Income, net

Other financial income, net, decreased by 42% from $848,000 in financial

income for the three-month period ended September 30, 2022 to $493,000 in financial income for the three-month period ended September

This decrease is mainly attributable to a reduction in income from exchange rate differences related to the EIB loan.

This decrease

was partially offset by expenses from exchange rate related to NIS deposits following the strength of the U.S.

dollar against the NIS

and from increased income related to interest on deposits, due to an increase in interest rates.

Interest Expenses

Interest expenses decreased from $676,000 for the nine-month period

ended March 31, 2022 to interest expenses of $623,000 for the nine-month period ended March 31, 2023.

This decrease is attributable solely

to exchange rate differences due to the strength of the Euro against the U.S.

Interest expenses decreased

from $223,000 for the three-month period ended March 31, 2022 to interest expenses of $217,000 for the three-month period ended March

This decrease is attributable solely to exchange rate differences due to the strength of the Euro against the U.S.

Net loss for nine-month and three-month periods ended March 31, 2023

was $22,281,000 and $7,759,000, respectively, as compared to net loss of $32,290,000 and $9,918,000 for the nine-month and three-month

periods ended March 31, 2022.

The decrease was due to a decrease in general and administrative expenses and research and development expenses,

as a result of our efficiency cost reduction plan and the implementation of our new business strategy, alongside the completion or termination

of several clinical studies (in critical limb ischemia, ARDS associated with COVID 19, incomplete recovery following bone marrow transplantation

and completion of enrollment of muscle regeneration following hip fracture).

Net loss per share attributed to shareholders for the nine-month

and three-month periods ended March 31, 2023 was $0.63 and $0.19, respectively, as compared to $1.00 and $0.31 for the nine-month and

three-month periods ended March 31, 2022.

We had net loss attributed to our non-controlling interest in Ever After for the nine-month

and three-month periods ended March 31, 2023 of $419,000 and $135,000, respectively.

For the nine-month and three-month

periods ended March 31, 2023 and 2022, we had weighted average common shares outstanding of 35,217,037, 39,947,602, and 32,131,503, 32,261,628,

respectively, which were used in the computations of net loss per share for the nine and three-month periods.

The increase in weighted average

common shares outstanding reflects the issuance of additional shares pursuant to a private placement offering we conducted in December

2022, or the December 2022 Private Placement, and the issuance of additional shares upon the vesting of RSUs issued to directors, employees

and consultants.

Interest expenses increased

by 10% from $194,000 for the three-month period ended September 30, 2022 to interest expenses of $214,000 for the three-month period

ended September 30, 2023.

This increase is attributable solely to exchange rate differences of Euro versus the U.S.

Net loss for the three-month period ended September 30, 2023 was $5,098,000,

as compared to net loss of $6,269,000 for the three-month period ended September 30, 2022.

The decrease was due to a decrease in general

and administrative expenses and research and development expenses, as part of our efforts to reduce costs pursuant to an efficiency plan,

in addition to the completion or termination of several clinical studies.

Net loss per share attributed to shareholders for the three-month

period ended September 30, 2023 was $0.12, as compared to $0.19 for the three-month period ended September 30, 2022.

We had net loss attributed

to our non-controlling interest in Ever After for the three-month period ended September 30, 2023 of $137,000.

For the three-month periods

ended September 30, 2023 and 2022, we had weighted average common shares outstanding of 41,331,764 and 32,562,596, respectively which

were used in the computations of net loss per share for the three-month periods.

The increase in weighted

average common shares outstanding reflects the issuance of additional shares pursuant to a private placement offering we conducted in

December 2022, or the December 2022 Private Placement, and the issuance of additional shares upon the vesting of RSUs issued to directors,

employees and consultants.

Liquidity and Capital Resources

As of March 31, 2023, our total current assets were $46,687,000 and

total current liabilities were $5,377,000.

On March 31, 2023, we had a working capital surplus of $41,310,000, total equity of $20,881,000,

out of which $1,817,000 is attributed to the non-controlling interest in Ever After, and an accumulated deficit of $393,125,000.

As of September 30, 2023,

our total current assets were $35,258,000 and total current liabilities were $4,322,000.

On September 30, 2023, we had a working capital

surplus of $30,936,000, total equity of $11,038,000, out of which $2,137,000 is attributed to the non-controlling interest in Ever After,

and an accumulated deficit of $404,545,000.

Our cash and cash equivalents

as of March 31, 2023 amounted to $3,677,000, compared to $23,791,000 as of March 31, 2022, and compared to $9,772,000 as of June 30, 2022.

Cash balances changed in the nine months ended March 31, 2023 and 2022 for the reasons presented below.

as of September 30, 2023 amounted to $5,253,000, compared to $8,744,000 as of September 30, 2022, and compared to $5,360,000 as of June

Cash balances changed in the three months ended September 30, 2023 compared to the three months ended September 2022 for the

reasons presented below.

Net cash used for operating

activities was $19,960,000 in the nine months ended March 31, 2023, compared to $28,074,000 in the nine months ended March 31, 2022.

decrease is mainly attributed to a decrease in net loss following the completion of clinical trials and the implementation of our cost

reduction and efficiency plan that we initiated in order to align with the change in our business strategy.

Cash used in operating activities

in the nine months ended March 31, 2023 and 2022 consisted primarily of payments of fees to our suppliers, subcontractors, professional

services providers and consultants, and payments of salaries to our employees, partially offset by grants from the IIA, the EU’s

Horizon 2020 and 2022 programs, Israel’s Ministry of Economy and other research grants.

activities was $5,857,000 in the three months ended September 30, 2023, compared to $7,609,000 in the three months ended September 30,

The decrease is mainly attributed to a decrease in net loss following the completion of clinical trials and the implementation

of our cost reduction and efficiency plan.

Cash used in operating activities in the three months ended September 30, 2023 and 2022 consisted

primarily of payments to suppliers, subcontractors, professional services providers and consultants, and payments of salaries to our

employees, partially offset by grants from the IIA, the EU’s Horizon 2020 and Horizon Europe programs, and funds received from

the NIAID contract.

Investing activities provided

cash of $5,374,000 in the nine months ended March 31, 2023, compared to cash used of $14,738,000 for the nine months ended March 31,

The investing activities in the nine-month period ended March 31, 2023 consisted primarily of the withdrawal of $5,539,000 of short-term

The investing activities in the nine-month period ended March 31, 2022 consisted primarily of the investment of $4,233,000

in short-term deposits and proceeds of $19,052,000 from withdrawal of long-term deposits.

Financing activities provided cash of $8,034,000 in the nine months

ended March 31, 2023, compared to $7,500,000 for the nine months ended March 31, 2022.

The financing activities in the nine-month period

ended March 31, 2023 related to issuances of common shares and warrants, net of issuance cost, that were paid in cash, in the December

2022 Private Placement.

The financing activities in the nine-month period ended March 31, 2022 were related to proceeds of $7,500,000

we received from Tnuva as an investment in Ever After.

Between December 13, 2022 and December 27, 2022, we entered into a

series of securities purchase agreements with several purchasers for an aggregate of 8,155,900 common shares and warrants, or the Warrants,

to purchase up to 8,155,900 common shares.

On December 13, 2022, we executed securities purchase agreements to sell, at a purchase price

of $1.03 per share, up to 5,579,883 common shares and Warrants to purchase up to 5,579,833 common shares, with an exercise price of $1.03

per share and a term of three years.

On December 14, 2022, we executed securities purchase agreements to sell, at a purchase price of

$1.05 per share, up to 2,068,517 common shares and Warrants to purchase up to 2,068,517 common shares, with an exercise price of $1.05

per share and a term of three years.

On December 15, 2022, we executed securities purchase agreements to sell, at a purchase price of

$1.06 per share, up to 237,500 common shares and Warrants to purchase up to 237,500 common shares, with an exercise price of $1.06 per

share and a term of three years.

On December 19, 2022, we executed a securities purchase agreement to sell, at a purchase price of $1.09

per share, up to 135,000 common shares and Warrants to purchase up to 135,000 common shares, with an exercise price of $1.09 per share

and a term of three years.

On December 27, 2022, we executed a securities purchase agreement to sell, at a purchase price of $1.12 per

share, up to 135,000 common shares and Warrants to purchase up to 135,000 common shares, with an exercise price of $1.12 per share and

a term of three years.

The Warrants sold in the December 2022 Private Placement will be exercisable upon the later of six months from

their issuance date, or from the date the authorized shares increased.

As March 31, 2023, the Company issued 8,155,900 common shares and

warrants that relate to the December 2022 Private Placement and received $8,034,000 as of that date net of $435 from issuance expenses.

In addition, the purchasers

in the December 2022 Private Placement agreed to execute proxies permitting our Chief Executive Officer and Chief Financial Officer to

vote the securities purchased in the December 2022 Private Placement in favor of any shareholder vote relating to a future increase of

our authorized shares.

Pursuant to the securities purchase agreements executed with the purchasers, we agreed to hold a meeting of shareholders

within 200 days of the execution of the securities purchase agreements for the purpose of increasing our authorized shares.

On April 27, 2023, our shareholders approved an amendment to our articles

of incorporation of to increase the number of authorized common shares from 60,000,000 shares to 300,000,000 shares and such increase

was effectuated on May 1, 2023 when the Company filed its amendment to its articles of incorporation reflecting such increase.

the Warrants became exercisable on May 1, 2023.

cash of $5,802,000 in the three months ended September 30, 2023, compared to cash provided of $6,393,000 for the three months ended September

The investing activities in the three-month period ended September 30, 2023 and September 30, 2022 consisted primarily of the

withdrawal of short-term deposits, net of $5,905,000 and $6,466,000, respectively.

We had no financing activities

in the three months ended September 30, 2023 or 2022.

Between December 13, 2022

and December 27, 2022, we entered into a series of securities purchase agreements with several purchasers for an aggregate of 8,155,900

common shares and warrants, or the Warrants, to purchase up to 8,155,900 common shares.

On December 13, 2022, we executed securities

purchase agreements to sell, at a purchase price of $1.03 per share, up to 5,579,883 common shares and Warrants to purchase up to 5,579,833

common shares, with an exercise price of $1.03 per share and a term of three years.

On December 14, 2022, we executed securities purchase

agreements to sell, at a purchase price of $1.05 per share, up to 2,068,517 common shares and Warrants to purchase up to 2,068,517 common

shares, with an exercise price of $1.05 per share and a term of three years.

On December 15, 2022, we executed securities purchase agreements

to sell, at a purchase price of $1.06 per share, up to 237,500 common shares and Warrants to purchase up to 237,500 common shares, with

an exercise price of $1.06 per share and a term of three years.

On December 19, 2022, we executed a securities purchase agreement to

sell, at a purchase price of $1.09 per share, up to 135,000 common shares and Warrants to purchase up to 135,000 common shares, with

an exercise price of $1.09 per share and a term of three years.

On December 27, 2022, we executed a securities purchase agreement to

sell, at a purchase price of $1.12 per share, up to 135,000 common shares and Warrants to purchase up to 135,000 common shares, with

an exercise price of $1.12 per share and a term of three years.

The Warrants sold in the December 2022 Private Placement will be exercisable

upon the later of six months from their issuance date, or from the date the authorized shares increased.

The Company issued 8,155,900

common shares and warrants that relate to the December 2022 Private Placement and received $8,024,000 as of that date net of $445 from

issuance expenses.

On April 27, 2023, our shareholders

approved an amendment to our articles of incorporation of to increase the number of authorized common shares from 60,000,000 shares to

300,000,000 shares and such increase was effectuated on May 1, 2023 when the Company filed its amendment to its articles of incorporation

reflecting such increase.

As such, the Warrants became exercisable on May 1, 2023.

On December 14, 2022, Yaky

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its authorized share capital.

On July 16, 2020, we entered

into an Open Market Sale Agreement SM , or the ATM Agreement, with Jefferies LLC, or Jefferies, pursuant to which we were able

to issue and sell our common shares having an aggregate offering price of up to $75,000,000 from time to time through Jefferies.

entering into the ATM Agreement, we filed a new shelf registration statement on Form S-3, which was declared effective by the SEC on July

On September 21, 2022, as

a result of General Instruction I.B.6 of Form S-3, and in accordance with the terms of the Sales Agreement, we reduced the amount available

to be sold under the ATM Agreement to a maximum aggregate offering price of up to $11,800,000 of our common shares from time to time through

During the nine-month period

ended March 31, 2023, we did not sell of our any common shares under the ATM Agreement.

In April 2020, we and our

subsidiaries, Pluri Biotech Ltd.

July 16, 2020, we entered into an at-the market agreement, or the ATM Agreement, with Jefferies LLC, or Jefferies, pursuant to which

we may issue and sell shares of our common shares having an aggregate offering price of up to $75,000,000 from time to time through Jefferies.

Upon entering into the ATM Agreement, we filed a new shelf registration statement on Form S-3, which was declared effective by the SEC

on July 23, 2020.

On September 21, 2022, as a result of General Instruction I.B.6 of Form S-3, and in accordance with the terms of the

Sales Agreement, we reduced the amount available to be sold under the ATM Agreement to a maximum aggregate offering price of up to $11,800,000

of our common shares from time to time through Jefferies.

On September 7, 2023, we provided a formal notice of termination of the ATM

Agreement with Jefferies, which took effect on September 8, 2023.

the three months ended September 30, 2022, and 2023, we did not sell of our any common shares under the ATM Agreement.

Pursuant to a shelf registration on Form S-3 filed on September 12,

2023, which became effective on September 21, 2023, the Company may elect, from time to time, to offer and sell common shares, preferred

stock, warrants and units having an aggregate offering price of up to $200,000,000.

In April 2020, we and

our subsidiaries, Pluri Biotech Ltd.

and Pluristem GmbH, executed the EIB Finance Agreement for non–dilutive funding of up to €50

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June 1, 2026 and bears annual interest of 4% to be paid together with the principal of the loan.

As of March 31, 2023, the interest accrued

was in the amount of €1,463,000.

In addition to the interest payable, the EIB is also entitled to royalty payments, pro-rated to

the amount disbursed from the EIB loan, on the Company’s consolidated revenues beginning in the fiscal year 2024 up to and including

As of September 30, 2023, the interest

accrued was in the amount of €1,863,000.

In addition to the interest payable, the EIB is also entitled to royalty payments, pro-rated

to the amount disbursed from the EIB loan, on the Company’s consolidated revenues beginning in the fiscal year 2024 up to and including

its fiscal year 2030, in an amount equal to up to 2.3% of the Company’s consolidated revenues below $350 million, 1.2% of the Company’s

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In the absence of such sales, no payment

Through March 31, 2023, total grants obtained from the IIA aggregated to approximately $27,760,000 and total royalties paid

and accrued amounted to $169,000.

Through September 30, 2023, total grants obtained from the IIA aggregated to approximately $27,743,000 and total royalties

paid and accrued amounted to $179,000.

June 2020, we announced that we were selected as a member of the CRISPR-IL consortium, a group funded by the IIA.

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DNA, have applications in the pharma, agriculture, and aquaculture industries.

CRISPR-IL is funded by the IIA with a total budget of approximately

$10,000,000 of which, an amount of approximately $480,000 was a direct grant allocated to us, for the initial period of 18 months.

October 2021, we received an approval for an additional grant of approximately $583,000 from the IIA pursuant to the CRISPR-IL consortium

program, for an additional period of eighteen months.

During January 2023, we received approval for an extension of an additional 2 months

to finish the program until June 30, 2023.

The CRISPR-IL consortium program does not include any obligation to pay royalties.

March 31, 2023, we received total grants of approximately $775,000 in cash from the IIA pursuant to the CRISPR-IL consortium program,

out of which an amount of $80,000 was received during the nine-months ended March 31, 2023.

of March 31, 2023, we received total grants of approximately $6,614,000 in cash from the European Union research and development

consortiums pursuant to the Horizon programs.

During December 2022, we received an approval for an additional budget allocation of

approximately $735,000 to us, relates to PLX-PAD program for muscle recovery following surgery for hip fracture.

The full amount was

received by us in April 2023.

On September 6, 2022, we announced that a €7.5 million non-dilutive

grant from the European Union’s Horizon program was awarded to Advanced PeRsOnalized Therapies for Osteoarthritis (PROTO), an international

collaboration led by Charité Berlin Institute of Health Center for Regenerative Therapies.

The goal of the PROTO project is to

utilize our PLX-PAD cells in a Phase I/IIa study for the treatment of mild to moderate knee osteoarthritis.

Final approval of the grant

is subject to completion of the consortium agreement.

An amount of approximately Euro 500,000 (approximately $533,745) will be a direct

grant that will be allocated to us.

Through March 31, 2023, we received a payment of approximately $185,000 in cash, which relates to

the PROTO program.

Phase I/II study will be carried out by Charité, together with us and other members of the international consortium under the leadership

of Professor Tobias Winkler, Principal Investigator, at the Berlin Institute of Health Center of Regenerative Therapies, Julius Wolff

Institute and Center for Musculoskeletal Surgery.

CRISPR-IL is funded by the IIA with a total budget of

approximately $10,000,000 of which, an amount of approximately $480,000 was a direct grant allocated to us, for the initial period of

During October 2021, we received an approval for an additional grant of approximately $583,000 from the IIA pursuant to the

CRISPR-IL consortium program, for an additional period of eighteen months.

During January 2023, we received approval for an extension

of an additional 2 months to finish the program until June 30, 2023.

The CRISPR-IL consortium program does not include any obligation

to pay royalties.

September 30, 2023, we received total grants of approximately $774,000 in cash from the IIA pursuant to the CRISPR-IL consortium program;

no amount was received during the three months ended September 30, 2023.

September 6, 2022, we announced that a €7.5 million non-dilutive grant from the European Union’s Horizon program was awarded

to Advanced PeRsOnalized Therapies for Osteoarthritis (PROTO), an international collaboration led by Charité Berlin Institute

of Health Center for Regenerative Therapies.

The goal of the PROTO project is to utilize our PLX-PAD cells in a Phase I/IIa study for

the treatment of mild to moderate knee osteoarthritis.

Final approval of the grant is subject to completion of the consortium agreement.

An amount of approximately Euro 500,000 (approximately $533,745) will be a direct grant that will be allocated to us.

Through September

30, 2023, we received a payment of approximately $185,000 in cash, which relates to the PROTO program.

Phase I/II study will be carried out by Charité, together with us and other members of the international consortium under the

leadership of Professor Tobias Winkler, Principal Investigator, at the Berlin Institute of Health Center of Regenerative Therapies, Julius

Wolff Institute and Center for Musculoskeletal Surgery.

July 11, 2023, we signed a three-year $4,200,000 contract with the NIAID, which is part of the NIH.

We will collaborate with the U.S.

Department of Defense’s, or DoD’s, AFRRI and USUHS to further advance the development of our PLX-R18 cell therapy as a potential

novel treatment for H-ARS.

H-ARS is a deadly disease that can result from nuclear disasters and radiation exposure.

The period of performance

of this contract will be from July 1, 2023 through June 30, 2024, which may be extended for an additional two-year period.

As of September

30, 2023, we expect to receive from the NIAID grant approximately $382,000.

The currency of our financial

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For more information, please see Item 7A.

- “Quantitative and Qualitative Disclosures about Market Risk”

in the 2022 Annual Report.

- “Quantitative and Qualitative Disclosures about Market

Risk” in the 2023 Annual Report.

We have an effective Form

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registration process.

Under this shelf registration process, we may, from time to time, sell our common shares, preferred shares and warrants

to purchase common shares, and units of two or more of such securities in one or more offerings up to a total dollar amount of $250,000,000.

As of February 13, 2022, other than the $11,800,000 of common shares we are eligible to sell pursuant to the ATM Agreement, and the $30,000,000

of common shares we sold in a registered direct offering in February 2021, no securities have been sold pursuant to our effective Form

S-3 registration statement.

We have accumulated a deficit

of $393,125,000 since our inception in May 2001.

We do not expect to generate any significant revenues from sales of products in the next

twelve months.

We expect to generate revenues, from the sale of licenses to use our technology or products, but in the short and medium

terms will unlikely exceed our costs of operations.

Under this shelf registration process, we may, from time to time, sell our common shares, preferred stock and warrants

to purchase common shares, and of two or more of such securities, in one or more offerings for an aggregate initial offering price of

$200,000,000.

As of November 13, 2023 , no securities have been sold pursuant to

our effective Form S-3 registration statement.

We have accumulated a deficit of $404,545,000 since our inception in

We do not expect to generate any significant revenues from sales of products in the next twelve months.

We expect to generate

revenues, from collaborations and sales of licenses to use our technology or products, but in the short and medium terms these will unlikely

exceed our costs of operations.

We may be required to obtain

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development and clinical study activities.

We are continually looking for sources of funding, including non-diluting

sources such as collaboration with other companies via licensing agreements, joint venture and partnerships, research grants such as the

IIA grants and the European Union grant, and sales of our common shares.

We are continually looking

for sources of funding, including non-diluting sources such as collaboration with other companies via licensing agreements, joint venture

and partnerships, R&D contracts such as our agreement with the NIAID, research grants such as the IIA grants and the European Union

grant, and sales of our common shares.

We believe that we have sufficient

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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-Q

Item 2. Management’s Discussion and Analysis