What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2022-09-28 compared with 2021-09-28 · 125 added, 122 removed, 236 unchanged (51% of the section changed)

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Dollars are denoted herein by “USD,” “$” and “dollars”.

Propanc, our highest priority remains the safety, health and well-being of our employees, their families and our communities.

pandemic is a highly fluid situation and it is not currently possible for us to reasonably estimate the impact it may have on our financial

and operating results.

We will continue to evaluate the impact of the COVID-19 pandemic on our business as we learn more and the impact

of COVID-19 on our industry becomes clearer.

We are complying health guidelines regarding safety procedures, including, but are not limited

to, social distancing, remote working, and teleconferencing.

The extent of the future impact of the COVID-19 pandemic on our business

is uncertain and difficult to predict.

Adverse global economic and market conditions as a result of COVID-19 could also adversely affect

our business.

If the pandemic continues to cause significant negative impacts to economic conditions, our results of operations, financial

condition and liquidity could be adversely impacted.

COVID-19 pandemic is a highly fluid situation and it is not currently possible for us to reasonably estimate the impact it may have on

our financial and operating results.

We will continue to evaluate the impact of the COVID-19 pandemic on our business as we learn more

and the impact of COVID-19 on our industry becomes clearer.

We are complying health guidelines regarding safety procedures, including,

but are not limited to, social distancing, remote working, and teleconferencing.

The extent of the future impact of the COVID-19 pandemic

on our business is uncertain and difficult to predict.

Adverse global economic and market conditions as a result of COVID-19 could also

adversely affect our business.

If the pandemic continues to cause significant negative impacts to economic conditions, our results of

operations, financial condition and liquidity could be adversely impacted.

were incorporated in the state of Delaware as Propanc Health Group Corporation on November 23, 2010.

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inactive precursors of enzymes.

October 1, 2020, the Company entered into a two-year collaboration agreement with the University of Jaén (the “University”)

to provide certain research services to the Company.

In consideration of such services, the Company agreed to pay the University approximately

30,000 Euros ($35,145 USD) which shall be paid in four installment payments of 5,000 Euros in November 2020, 5,000 Euros ($5,858) in

March 2021, 10,000 Euros ($11,715) in December 2021 and 10,000 Euros ($11,715) in September 2022.

Additionally, the University shall

hire and train a doctoral student for this project and as such the Company shall pay the University 25,837 Euros ($30,268 USD).

for full ownership of the intellectual property, the Company agreed to pay royalties of 2% of net revenues to the University.

November 17, 2020, the Company effected a one-for-one thousand (1:1,000) reverse stock split of the Company’s issued and outstanding

shares of common stock (the “Reverse Stock Split”).

Proportional adjustments for the Reverse Stock Split were made to the

Company’s outstanding stock options, warrants and equity incentive plans.

All share and per-share data and amounts have been retroactively

adjusted as of the earliest period presented in the consolidated financial statements and in this annual report to reflect the

Reverse Stock Split.

On May 11, 2021, the Company’s scientific

researchers with the Universities of Jaén and Granada, published data in a peer reviewed journal, Expert Opinion on Biological

Therapy , confirming the anti-tumor potential of a mixture of two pancreatic proenzymes trypsinogen and chymotrypsinogen.

with proenzymes sensitizes cancer stem cells which may allow standard treatment approaches like chemotherapy and radiotherapy to be more

Between August 6, 2020 to June 29, 2021, advancements

were made with the Company’s patent portfolio including allowed claims describing a pharmaceutical composition for treating cancer

in Brazil (covering the Company’s lead patent application), a first granted patent describing a method to treat cancer stem cells

in Australia, and granted patents in Australia and Indonesia, with allowed claims in Singapore, citing higher doses of a pharmaceutical

The advancements represent three of four patent families covering the Company’s lead product, PRP.

March 22, 2022, a Notice of Allowance has been received from the US Patent and Trademark Office (USPTO) for claims involving a novel

method to treat cancer stem cells (CSC’s).

The allowed US patent protects proprietary claims capturing methods and uses for pancreatic

proenzymes to treat cancer by specifically targeting and eradicating CSCs.

It is the first allowed by the USPTO covering a method of

minimizing the progression of cancer in a patient by administering a therapeutically effective amount of two proenzymes, trypsinogen

and chymotrypsinogen, thereby preventing metastatic cancer in the patient by targeting and eradicating CSCs from solid tumors.

May 2, 2022, pharma grade raw materials were purchased for the manufacture of PRP in preparation for the Phase I First-In-Human (FIH)

study in advanced cancer patients suffering from solid tumors.

Approximately 0.5kg of trypsinogen and 2.4kg of chymtrypsinogen was procured

initially, with a second half of the same batch quantities to be purchased towards the middle of this year.

The total amount of raw materials

purchased is expected to be sufficient for the early-stage clinical development plan for PRP, which is administered by intravenous (I.V.)

injection, once weekly.

The first FIH study is planned for treatment of up to 30 to 40 patients with advanced solid tumors.

be followed by up to two 60 patient Phase II studies in patients suffering from pancreatic and ovarian tumors.

May 18, 2022, the board of directors of the Company approved and authorized, and the holders of a majority in interest of the Company’s

voting capital stock approved by written consent, in accordance with Section 228 of the Delaware General Corporation Law, for the Company

to file a Certificate of Amendment to its Certificate of Incorporation (the “Certificate”) with the Secretary of State of

the State of Delaware, which increased the Company’s authorized capital stock.

The Certificate increased the number of authorized

shares of the Company’s common stock, par value $0.001 per share, from 1,000,000,000 to 3,000,000,000.

The number of authorized

shares of preferred stock remains at 1,500,005, such that the total number of shares of all classes and series the Company is authorized

to issue is 3,001,500,005 shares.

The Certificate was filed and became effective on July 6, 2022.

July 19, 2022, successful production of a synthetic recombinant version of the proenzyme trypsinogen was completed via the Proenzyme

Optimization Project 1 (POP1) joint research and drug discovery program.

The program is designed to produce a backup clinical compound

to the Company’s lead product candidate, PRP, which is targeting metastatic cancer from solid tumors.

On August 23, 2022, the initial

success of producing trypsinogen synthetically has now advanced to the stage where optimization of protein production is underway, whereas

purification and yield of chymotrypsinogen is currently the focus of research.

August 3, 2022, a Joint Research Collaboration Agreement was established with the Universities of Jaén and Granada, Spain.

late 2020, Mrs.

Belén Toledo Cutillas MSc, has been investigating an important experimental thesis on the effects of proenzyme

therapy and the tumor microenvironment, which is the key to the development, invasion, metastatic spread and recurrence of solid tumors.

The work is being conducted at the laboratory of Professor Macarena Perán

PhD, who is the lead researcher on the project and is the second Joint Research and Collaboration Agreement currently in progress with

the two Spanish Universities.

August 16, 2022, a Notice of Allowance has been received from the European Patent Office (EPO) for claims involving compositions of proenzymes

to treat cancer.

This is the second patent application allowed in this jurisdiction and expires in November, 2036.

A third patent application

is currently under examination at the EPO for a method to treat cancer stem cells, which was allowed in March this year by the US Patent

and Trademark Office (USPTO).

The field of the invention covers future dosing in planned clinical studies for the Company’s lead

product candidate, PRP.

of Operations

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Administration

expense decreased to $1,553,075 for the year ended June 30, 2021 as compared to $3,281,464 for the year ended June 30, 2020.

This decrease

of approximately $1,728,000 is primarily attributable to a decrease of approximately $1,190,000 in stock-based expenses for services,

decrease of approximately $128,000 of indirect capital raising costs, decrease in general consulting, legal, and investor

relation fees of approximately $265,000, decrease in accounting fees of approximately $17,000, decrease in insurance expense of approximately

$75,000, decrease of approximately $124,000 in marketing and market research expense, decrease in travel expenses of approximately $28,000,

decrease of approximately $19,000 of other general and administrative expenses and offset by increase of approximately $118,000 in employee

remuneration expense.

expense decreased by approximately $4,700 to $28,112 for the year ended June 30, 2021.

The decrease primarily relates to exchange rate

movements over the period when compared to the same period in 2020.

expense increased to $1,706,452 for the year ended June 30, 2022 as compared to $1,553,075 for the year ended June 30, 2021.

This increase

of approximately $153,000 is primarily attributable to an increase of approximately $159,000 in stock-based expenses for services, increase

in general consulting, legal, and investor relation fees of approximately $250,000 offset by decrease in accounting fees of approximately

$10,000, decrease of approximately $48,000 in marketing and market research expense, decrease in employee remuneration expense of approximately

$195,000, and decrease of approximately $1,000 of other general and administrative expenses.

expense was $28,366 for the year ended June 30, 2022 as compared to $28,112 for the year ended June 30, 2021, an increase of

and Development Expenses

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Expense/Income

expense decreased to $449,457 for the year ended June 30, 2021, as compared to $1,748,381 for the year ended June 30, 2020.

expense is primarily comprised of approximately $337,000 of debt discount amortization and accretion of put premium for the year ended

June 30, 2021, and interest expense from conversion fees, prepayment penalty fees and accrual of interest expense for a total of approximately

expense increased to $568,798 for the year ended June 30, 2022, as compared to $449,457 for the year ended June 30, 2021.

Interest expense

is primarily comprised of approximately $500,000 of debt discount amortization and accretion of put premium for the year ended June 30,

2022, and interest expense from conversion fees, and accrual of interest expense for a total of approximately

$69,000 for the year ended June 30, 2022.

decrease of $1,298,924 is primarily attributable to a decrease in the issuance of convertible notes and was further reduced due to the

conversion and repayment of convertible notes during the year ended June 30, 2021 which resulted to a decrease in accretion of put premium

of approximately $636,000 during the year ended June 30, 2021, and the decrease in amortization of debt discount of approximately $598,000

during the year ended June 30, 2021.

Additionally, interest expense from prepayment penalty fees decreased by approximately $99,000 offset

by increase in conversion fees and accrual of interest expense for a total of $34,000 during the year ended June 30, 2021.

increase of $119,341 is primarily attributable to the increase of approximately $35,000 in

accretion of put premium, interest expense of approximately $252,000 offset by decrease in amortization of debt discount of

approximately $89,000, decrease in prepayment and default penalty fees of approximately $9,000, decrease in conversion fees of

$14,000 and decrease in accrual of interest expense for a total of $21,000 during the year ended June 30, 2022.

in Fair Value of Derivative Liabilities

in fair value of derivative liabilities changed by $393,479, to a loss of $8,186 for the year ended June 30, 2021, as compared to a gain

in fair value of derivative liabilities changed by $90,925, to a loss of $99,111 for the year ended June 30, 2022, as compared to a loss

of $8,186 for the year ended June 30, 2021.

This change is primarily attributable to a decrease in the principal amount of convertible

notes with bifurcated embedded conversion option derivatives during the year ended June 30, 2021.

This increase in loss of approximately $91,000 is primarily attributable to an increase in

fair value of the principal amount of a convertible note with bifurcated embedded conversion option derivatives during the year ended

June 30, 2022.

from Settlement of Debt, net

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Accordingly, the Company recognized loss from settlement of debt of $43,238 during the year ended June 30, 2021.

was no comparable transaction during the year ended June 30, 2022.

(loss) on Extinguishment of Debt, net

the year ended June 30, 2020, notes with principal amounts totaling $254,500 and accrued interest of $15,408 contained bifurcated

embedded conversion option derivatives.

the year ended June 30, 2021, notes with principal amounts totaling $95,000 and accrued interest of $3,000 contained bifurcated embedded

conversion option derivatives.

Accordingly, the fair market value of the shares issued was $178,368 resulting in a loss on extinguishment

at the time of conversion of $80,368 and $130,975 of derivative fair value was recorded as a gain on extinguishment at the time of conversion,

During the year ended June 30, 2021, notes with

principal amounts totaling $95,000 and accrued interest of $3,000 contained bifurcated embedded conversion option derivatives.

the fair market value of the shares issued was $178,368 resulting in a loss on extinguishment at the time of conversion of $80,368 and

$130,975 of derivative fair value was recorded as a gain on extinguishment at the time of conversion, resulting in a net gain of $50,607.

resulting in a net gain of $50,607.

the year ended June 30, 2022, notes with principal amounts totaling $1,000 and accrued interest of $8,000 contained bifurcated embedded

conversion option derivatives.

Accordingly, the fair market value of the shares issued was $28,572, resulting in a loss on extinguishment

at the time of conversion of $19,572 and $2,069 of derivative fair value was recorded as a gain on extinguishment at the time of conversion,

resulting in a net loss of $17,503.

Currency Transaction Gain (Loss)

currency transaction changed to a gain of $30,497 for the year ended June 30, 2021 as compared with a loss of $143,808 for the

year ended June 30, 2020.

foreign currency transaction decreased to a gain is partially attributable to the increase in exchange rates during the year ended June

currency transaction changed to a loss of $42,395 for the year ended June 30, 2022 as compared with a gain of $30,497 for the year ended

June 30, 2021.

foreign currency transaction decreased to a loss is partially attributable to the decrease in exchange rates during the year ended June

30 2022 as compared to the year ended June 30, 2021.

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tax credit in the amount of $54,977 and $113,415, respectively.

loss decreased to $2,025,947 for the year ended June 30, 2021 as compared to a net loss of $4,740,723 for the year ended June 30, 2020.

loss increased to $2,658,087 for the year ended June 30, 2022 as compared to a net loss of $2,025,947 for the year ended June 30, 2021.

The change relates to the factors discussed above.

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fair value of the warrants with a strike price corresponding to the reduced strike price upon the down round feature being triggered.

Accordingly, the Company recognized deemed dividend of $391,749 and a corresponding reduction of income available to common stockholders

upon the alternate cashless exercise of these warrants.

Accordingly, the Company recognized deemed dividend of $700,340 and $391,749 and a corresponding reduction of income available to common

stockholders upon the alternate cashless exercise of these warrants during the years ended June 30, 2022 and 2021, respectively.

loss available to common stockholders

loss available to common stockholders decreased to $2,417,696 for the year ended June 30, 2021 as compared to a net loss of $4,740,723

loss available to common stockholders increased to $3,358,427 for the year ended June 30, 2022 as compared to a net loss of $2,417,696

for the year ended June 30, 2021.

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Financial Condition

of June 30, 2021, we had total assets of $13,101, comprised primarily of cash of $2,255, GST tax receivable of $4,341, property and equipment,

net, of $4,255 and security deposit of $2,250.

As compared to June 30, 2020, we had total assets of $98,518, comprised primarily of cash

of $67,007, GST tax receivable of $2,015, property and equipment, net, of $5,747 and operating lease right of use asset, net, $21,682.

of June 30, 2022, we had total assets of $81,651, comprised primarily of cash of $4,067, GST tax receivable of $2,342, prepaid expenses

and other current assets of $8,621, property and equipment, net, of $2,023, operating lease ROU asset, net of $62,523, and security deposit

As of June 30, 2021, we had total assets of $13,101, comprised primarily of cash of $2,255, GST tax receivable of

$4,341, property and equipment, net, of $4,255 and security deposit of $2,250.

had current liabilities of $3,062,981, primarily comprised of net convertible debt of $984,260, accounts payable and accrued expenses

of $1,409,138, employee benefit liability of $415,799, and embedded conversion option liabilities of $151,262 as of June 30, 2022.

As compared to June 30, 2020, we had current liabilities of $3,739,943, primarily comprised of net convertible debt of $1,557,734, accounts

payable and accrued expenses of $1,544,387, employee benefit liability of $354,109, and embedded conversion option liabilities

of June 30, 2021, we had current liabilities of $3,080,674, primarily comprised of net convertible debt of $624,583, accounts

payable and accrued expenses of $1,894,486, employee benefit liability of $418,538, and embedded conversion option liabilities of $54,220.

have funded our operations primarily through the issuance of equity and/or convertible securities for cash.

The cash was used primarily

for payments for research and development, administration expenses, occupancy expenses, professional fees, consultants and travel.

the year ended June 30, 2021 we received proceeds from exercise of warrants of $776,044 and proceeds from issuance of convertible notes

for payments for research and development, administration expenses, occupancy expenses, professional fees, consulting fees and travel.

the year ended June 30, 2022 we received proceeds from exercise of warrants of $625,001, proceeds from issuance of convertible notes

of $766,500 and proceeds from sale of our stocks of $99,285.

have substantial capital resource requirements and have incurred significant losses since inception.

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by non-cash charges of amortization of debt discount of $47,971, stock-based compensation of $387,139, non-cash interest expense of $2,250,

accretion of put premium of $452,308, change in fair value of derivatives of $99,111, foreign currency transaction loss of $42,395, and

$17,503 loss on extinguishment of debt.

Net changes in operating assets and liabilities totaled $171,113, which is primarily attributable

to increase in accounts payable of $18,870, increase in accrued expenses and other payables of $65,017, employee benefit liability of

$29,907, and accrued interest of $63,878.

cash used in operating activities was $1,145,264 for the year ended June 30, 2021, due to our net loss of $2,025,947, offset primarily

by non-cash charges of amortization of debt discount of $136,527, stock-based compensation of $208,444, non-cash interest expense of

$16,500, accretion of put premium of $200,410, change in fair value of derivatives of $8,186 addback foreign currency transaction gain

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payables of $152,861, employee benefit liability of $33,134, and accrued interest of $80,582.

cash used in operating activities was $1,849,589 for the year ended June 30, 2020, due to our net loss of $4,740,723 offset primarily

by non-cash charges of amortization of debt discount of $734,130, stock-based compensation of $1,398,868, accretion of put premium of

$836,724, non-cash interest expense of $15,000, foreign currency transaction loss of $143,808 addback gain on extinguishment of debt

of $67,123 and $385,293 of change in fair value of derivatives.

Net changes in operating assets and liabilities totaled $212,547, which

is primarily attributable to decrease in prepaid expenses and other assets of $83,157, increase in employee benefit liability of $35,724,

and accrued interest of $156,417 and offset by decrease in accounts payable of $29,737 and accrued expenses and other payables of $9,740.

Cash Flow from Financing Activities

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June 30, 2021.

During the year ended June 30, 2021 we received proceeds from the exercise of warrants of $776,044 and proceeds from

issuance of convertible notes of $325,000 offset by repayments of convertible notes of $43,000.

During the year ended June 30, 2020,

we received proceeds from the sale of convertible promissory notes of $1,465,250 and sale of common stock of $450,000, net of

$25,010 in issue costs.

During the year ended June 30, 2022 we received proceeds from the exercise of warrants of $625,001, proceeds from sale

of common stock of $99,285, and proceeds from issuance of convertible notes of $766,500.

During the year ended June 30, 2021 we received

proceeds from the exercise of warrants of $776,044 and proceeds from issuance of convertible notes of $325,000 offset by repayments of

convertible notes of $43,000.

of Exchange Rate

effect of the exchange rate on cash resulted in a $22,468 positive adjustment to cash flows in the year ended June 30, 2021 as compared

to an adjustment of $23,962 to cash flows in the year ended June 30, 2020.

effect of the exchange rate on cash resulted in a $52,670 negative adjustment to cash flows in the year ended June 30, 2022 as compared

to a positive adjustment of $22,468 to cash flows in the year ended June 30, 2021.

The reason for the fluctuation is due to the application

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The concession is recognized as an income tax benefit, in operations, upon receipt.

In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-02, Leases (Topic 842).

updated guidance requires lessees to recognize lease assets and lease liabilities for most operating leases.

In addition, the updated

guidance requires that lessors separate lease and non-lease components in a contract in accordance with the new revenue guidance in ASC

This guidance is effective for interim and annual reporting periods beginning after December 15, 2018.

The Company adopted this

guidance effective July 1, 2019.

July 1, 2019, the Company adopted ASU No.

2016-02, applying the package of practical expedients to leases that commenced before the effective

date whereby the Company elected to not reassess the following:

(i) whether any expired or existing contracts contain leases and;

initial direct costs for any existing leases.

For contracts entered into on or after the effective date, at the inception of a contract

the Company assessed whether the contract is, or contains, a lease.

The Company’s assessment is based on:

(1) whether the contract

involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use

of the asset throughout the period, and (3) whether it has the right to direct the use of the asset.

The Company will allocate the consideration

in the contract to each lease component based on its relative stand-alone price to determine the lease payments.

lease ROU assets represents the right to use the leased asset for the lease term and operating lease liabilities are recognized based

on the present value of future minimum lease payments over the lease term at commencement date.

As most leases do not provide an implicit

rate, the Company use an incremental borrowing rate based on the information available at the adoption date in determining the present

value of future payments.

Lease expense for minimum lease payments is amortized on a straight-line basis over the lease term and is included

in general and administrative expenses in the consolidated statements of operations.

Accounting Pronouncements

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Concern Qualification” might make it substantially more difficult to raise capital.

completion of the Company’s development program and, ultimately, the attainment of profitable operations are dependent upon future

events, including obtaining adequate financing to fulfill its development activities, acceptance of the Company’s patent applications,

obtaining additional sources of suitable and adequate financing and ultimately achieving a level of sales adequate to support the Company’s

cost structure and business plan.

The Company’s ability to continue as a going concern is also dependent on its ability to further

develop and execute on its business plan.

However, there can be no assurances that any or all of these endeavors will be successful.

Sheet Arrangements

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

What changed 10-K

Item 7. Management’s Discussion and Analysis