RASNA THERAPEUTICS : MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-K)

Forward-Looking Statements

The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with the financial statements and the
related notes and other information that are included elsewhere in this Form
10-K. This discussion contains forward-looking statements based upon current
expectations that involve risks and uncertainties, such as our plans,
objectives, expectations and intentions. Actual results and the timing of events
could differ materially from those anticipated in these forward-looking
statements as a result of a number of factors, including those set forth under
the cautionary note regarding "Forward-Looking Statements" contained elsewhere
in this Form 10-K. Additionally, you should read the "Risk Factors" section of
this Form 10-K for a discussion of important factors that could cause actual
results to differ materially from the results described in or implied by the
forward-looking statements contained in the following discussion and analysis.



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Our audited financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.

We assume no obligation to revise or publicly release the results of any
revision to these forward-looking statements, except as required by law. Given
these risks and uncertainties, readers are cautioned not to place undue reliance
on such forward-looking statements.

Unless expressly indicated or the context requires otherwise, the terms "Rasna,"," the "Company," "we," "us," and "our" refer to Rasna Therapeutics, Inc., a Nevada corporation, and, where appropriate, its wholly owned subsidiaries.

Company Background



Overview



To date, we have devoted substantially all of our resources to research and
development efforts relating to our therapeutic candidates, including conducting
clinical trials and developing manufacturing capabilities, in-licensing related
intellectual property, protecting our intellectual property and providing
general and administrative support for these operations. Since our inception, we
have funded our operations primarily through the issuance of equity securities.

We anticipate that our expenses will increase substantially if and as we:

continue enrollment in our ongoing clinical trials;

initiate new clinical trials;

seek to identify, assess, acquire and develop other products, therapeutic

candidates and technologies;

seek regulatory and marketing approvals in multiple jurisdictions for our

therapeutic candidates that successfully complete clinical studies;

establish collaborations with third parties for the development and

commercialization of our products and therapeutic candidates;

make milestone or other payments under our agreements pursuant to which we

have licensed or acquired rights to intellectual property and technology

seek to maintain, protect, and expand our intellectual property portfolio;

seek to attract and retain skilled personnel;

incur the administrative costs associated with being a public company and

related costs of compliance;

create additional infrastructure to support our operations as a commercial

stage public company and our planned future commercialization efforts; and

experience any delays or encounter issues with any of the above.

We expect to continue to incur significant expenses and increasing losses for at
least the next several years. Accordingly, we anticipate that we will need to
raise additional capital in addition to the net proceeds from this offering in
order to obtain regulatory approval for, and the commercialization of our
therapeutic candidates. Until such time that we can generate meaningful revenue
from product sales, if ever, we expect to finance our operating activities
through public or private equity or debt financings, government or other
third-party funding, marketing and distribution arrangements and other
collaborations, strategic alliances and licensing arrangements or a combination
of these approaches. If we are unable to obtain funding on a timely basis, we
may be required to significantly curtail, delay or discontinue one or more of
our research or development programs or the commercialization of any approved
therapies or products or be unable to expand our operations or otherwise
capitalize on our business opportunities, as desired, which could materially
adversely affect our business, financial condition and results of operations.

On October 11, 2017, we changed our fiscal year end from March 31 to September 30 and we filed a Form 10-KT on November 30, 2017.

On April 27, 2016, Rasna Therapeutics Limited, a private limited company
incorporated in England and Wales under the U.K. Companies Act ("Rasna UK") sold
its stake in Falconridge Holdings Limited, or Falconridge,  to Rasna DE for $1.
This entity had no operations,  assets or liabilities as of this date.



On May 17, 2016, Rasna DE and its subsidiary Falconridge entered into an
Agreement of Merger and Plan of Reorganization (the "Merger Agreement") with
Arna Therapeutics Limited, a British Virgin Islands company, or Arna, which was
a clinical stage biotechnology company focused on drugs to treat diseases in
oncology and immunology, mainly focusing on the treatment of leukemia. Pursuant
to the Merger Agreement, Arna was merged into Falconridge and the shareholders
of Arna were issued shares of Rasna DE in exchange for shares of Arna.



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On August 15, 2016, Active With Me, Inc., or AWM, entered into an Agreement of
Merger and Plan of Reorganization with Rasna DE, and Rasna Acquisition,
providing for the merger of Rasna Acquisition with and into Rasna DE, (the
"Merger"), with Rasna DE, surviving the Merger as a wholly-owned subsidiary of
AWM. As a result of the Merger, the resulting company, Rasna Therapeutics, Inc.,
is a biotechnology company that is engaged in modulating the molecular targets
NPM1 and LSD1, which are implicated in the disease progression of leukemia and
lymphoma.



The Merger has been treated as a reverse recapitalization effected by a share
exchange for financial accounting and reporting purposes since substantially all
of AWM's operations were disposed of prior to the consummation of the
transaction. Rasna DE is treated as the accounting acquirer as its stockholders
control us after the Merger Agreement, even though AWM was treated as the legal
acquirer. As a result of the Merger,  the assets and liabilities and the
historical operations that are reflected in our financial statements are those
of Rasna DE as if Rasna DE had always been the reporting company. Since the
transaction was treated as a reverse recapitalization for accounting purposes,
no goodwill or other intangible assets were recorded by us as a result of the
Merger Agreement.



Thereafter, pursuant to a Stock Purchase Agreement, the Company transferred all
of the outstanding capital stock of Rasna DE to a former officer and director of
AWM in exchange for cancellation of an aggregate of 1,500,000 shares of Rasna
DE's common stock held by such person.



In connection with the share exchange, each share of Rasna DE was exchanged for
the right to receive .33 shares in AWM. Once issued, the new shares were
combined with the 3,305,000 common shares held by legacy AWM shareholders.
Immediately following the Merger, 1,500,000 shares were canceled, which related
to one legacy AWM shareholder that effectively spun off the remaining assets of
AWM in connection with the transaction. Finally, subsequent to the transaction,
the legal acquirer executed a 3.25 for 1 stock split on its common shares.
Historical common stock amounts and additional paid-in capital have been
retroactively adjusted for the effect of the share splits executive in
connection with the Merger transaction.



On September 20, 2016, we filed a Certificate of Change in Nevada which effected
a 3.25 for 1 forward stock split of our common stock for shareholders of record
as of August 16, 2016 and increased the authorized number of shares of common
stock to 200,000,000 shares.

We only have one segment of activity which is that of a clinical stage biotechnology company focused on targeted drugs to treat diseases in oncology and immunology, mainly focusing on the treatment of leukemia.

Acquisitions

The following transactions were accounted for using the purchase accounting method which requires, among other things, that the assets acquired and liabilities assumed are recognized at their acquisition date fair value.

On May 5, 2016, Rasna UK sold its intellectual property to Falconridge, a
subsidiary of Rasna DE, for a note payable in the amount of $236,269. The fair
value of the intellectual property was determined to be $236,269 based on the
consideration received.



On May 17, 2016, Arna was merged into Falconridge and the shareholders of Arna
were issued shares of Rasna DE, in exchange for shares of Arna. On this day,
Rasna DE, and its subsidiary Falconridge entered into an Agreement of Merger and
Plan of Reorganization with Arna. Pursuant to the agreement, Arna was merged
into Falconridge and the shareholders of Arna were issued shares of Rasna DE, in
exchange for shares of Arna. Arna was deemed to be the accounting acquirer
because Rasna DE and Falconridge Holdings Limited were non-trading holding
companies and Arna's operations will comprise the ongoing operations of the
combined entity and its senior management will serve as the senior management of
the combined entity. Further, 65% of the voting interest in Rasna DE, was
acquired in connection with the transaction. Therefore, the assets and
liabilities of the acquired entity, Rasna DE, were written to fair value in
accordance with the Acquisition Method prescribed in  Accounting Standards
Codification ("ASC") 805, Business Combinations.



The consideration transferred was measured based upon the share price recently
received during a non-public equity raise in Rasna DE, during which non-related
investors paid $0.40 per share of common stock. During the acquisition
transaction, 19,187,500 of 54,837,790 shares were issued to legacy Rasna DE
shareholders, which results in consideration transferred to the acquiree's
shareholders of $7,675,000.

In addition, $607,159 of a related party receivable due to Arna from Rasna UK, was forgiven as part of the consideration transferred.

Critical Accounting Policies and Estimates

This discussion and analysis of our financial condition and results of
operations is based on our financial statements, which have been prepared in
accordance with generally accepted accounting principles in the United States of
America, or GAAP. The preparation of these financial statements requires us to
make estimates and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenue and expenses during the
reported period. In accordance with US GAAP, we base our estimates on historical
experience and on various other assumptions that we believe are reasonable under
the circumstances. Actual results may differ from these estimates under
different assumptions or conditions.



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While our significant accounting policies are more fully described in Note 2 to
our audited financial statements appearing elsewhere in this Annual Report, we
believe the following accounting policies are critical to the process of making
significant judgments and estimates in the preparation of our financial
statements.



Basis of preparation



The accompanying consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States of
America ("US GAAP"). Any reference in these notes to applicable guidance is
meant to refer to GAAP as found in the Accounting Standards Codification ("ASC")
and Accounting Standards Updates ("ASU") of the Financial Accounting Standards
Board ("FASB").



Principles of Consolidation



In accordance with ASC 810, Consolidation, the Company consolidates any entity
in which it has a controlling financial interest. Further, the Company
consolidates any variable interest entity that it is deemed to be the primary
beneficiary of, and have the power to direct its significant activities. Upon
review of the relationship between Rasna Therapeutics ("Rasna UK") and the
Company, Management determined that the equity investment in Rasna UK was not
sufficient to fund its operations. Accordingly, the Company is considered to be
the primary beneficiary of the assets held within Rasna UK, which primarily
consist of cash received from the Company to fund its operations, and has power
to direct its significant activities. As a result, the Company consolidates this
variable interest entity, which has minimal activity and has been liquidated.



The consolidated financial statements include the financial statements of the
Company and its wholly owned subsidiary, Rasna DE, and Rasna DE's subsidiary,
Arna Therapeutics Limited. All significant intercompany accounts and
transactions have been eliminated in the preparation of the accompanying
consolidated financial statements.




Going Concern



We are subject to a number of risks similar to those of other pre-commercial
stage companies, including its dependence on key individuals, uncertainty of
product development and generation of revenues, dependence on outside sources of
capital, risks associated with research, development, testing, and obtaining
related regulatory approvals of its pipeline products, suppliers and
collaborators, successful protection of intellectual property, competition with
larger, better-capitalized companies, successful completion of our development
programs and, ultimately, the attainment of profitable operations are dependent
on future events, including obtaining adequate financing to fulfill its
development activities and generating a level of revenues adequate to support
the Company's cost structure.



We have experienced net losses and significant cash outflows from cash used in
operating activities over the past two years, and as of September 30, 2020, had
an accumulated deficit of $22,658,481, a net loss for the year ended September
30, 2020 of $5,346,672 and net cash used in operating activities of $251,327.
These conditions indicate that there is substantial doubt about our ability to
continue as a going concern within the next twelve months from the filing date
of this annual report on Form 10-K.



We expect to continue to incur net losses and have significant cash outflows for
at least the next twelve months. We have sufficient funds to continue operating
until the end of January 2021, but will require significant additional cash
resources to launch new development phases of existing products in its pipeline.
In the event that we are unable to secure the necessary additional cash
resources needed, we may need to slow current development phases or halt new
development phases in order to mitigate the effects of the costs of development.
The accompanying consolidated financial statements have been prepared assuming
that we will continue as a going concern. This basis of accounting contemplates
the recovery of our assets and the satisfaction of liabilities in the normal
course of business. A successful transition to attaining profitable operations
is dependent upon achieving a level of positive cash flows adequate to support
our cost structure.



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Use of Estimates



The preparation of financial statements in conformity with  US GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. We evaluate our estimates on an ongoing basis, including
those related to the fair values of stock based compensation awards, income
taxes and contingent liabilities, among others. We base our estimates on
historical experience and on various other assumptions that we believe to be
reasonable, the results of which form the basis for making judgments about the
carrying amounts of assets and liabilities. Actual results could differ from
those estimates and such differences could be material to our consolidated
financial position and results of operations.

Fair Value of Financial Instruments

The carrying value of our financial instruments, including cash and cash
equivalents, accounts payable and accrued liabilities, approximate fair value
because of the short-term nature of such financial instruments. Management
measures certain other assets, at fair value on a nonrecurring basis when they
are deemed to be other-than-temporarily impaired.



Concentration of Credit Risk

Financial instruments that potentially subject us to concentrations of credit risk consist principally of related party receivables.

Deposits held with banks, including those held in foreign branches of global
banks, may exceed the amount of insurance provided on such deposits. These
deposits may be redeemed upon demand and bear minimal risk. Management believes
that the institutions that hold our instruments are financially sound and are
subject to minimal credit risk.



Cash and Cash Equivalents

Cash and cash equivalents consists of cash on deposit with banks with an original maturity of three months or less.

From time to time, our balances in its bank accounts exceed Federal Deposit
Insurance Corporation limits. We will periodically evaluate the risk of
exceeding insured levels and might transfer funds if it deems appropriate. We
have not experienced any losses with regards to balances in excess of insured
limits or as a result of other concentrations of credit risk

Goodwill and Intangible assets

Intangible assets are made up of in-process research and development, ("IPR&D")
and certain intellectual property ("IP"). The balance of IPR&D represents IPR&D
acquired in 2013, which, at the time, was determined to have alternative future
uses. IPR&D assets also represent the fair value assigned to acquired
technologies in a business combination, which at the time of the business
combination have not reached technological feasibility and have no alternative
future use. IP assets represent the fair value assigned to technologies, which
at the time of acquisition have reached technological feasibility, however, have
not yet been put into service. Intangible assets are considered to have an
indefinite useful life until the completion or abandonment of the associated
research and development projects.



Goodwill represents the premium paid over the fair value of the net tangible and
intangible assets acquired in business combinations. Goodwill is not amortized;
rather, it is subject to a periodic assessment for impairment by applying a fair
value based test. Goodwill is assessed for impairment on an annual basis or more
frequently if events or changes in circumstances indicate that the asset might
be impaired. An impairment charge is recognized only when the implied fair value
of our reporting unit's goodwill is less than its carrying amount.



Management evaluates indefinite life intangible assets for impairment on an
annual basis and on an interim basis if events or changes in circumstances
between annual impairment tests indicate that the asset might be impaired. The
ongoing evaluation for impairment of its indefinite life intangible assets
requires significant management estimates and judgment. Management reviews
definite life intangible assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Goodwill and intangible assets were fully impaired as of September
30, 2020. No impairment was recorded as at September 30, 2019.



Risks and Uncertainties

We intend to operate in an industry that is subject to rapid change. Our operations will be subject to significant risk and uncertainties including financial, operational, technological, regulatory, and other risks associated with an early stage company, including the potential risk of business failure.

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Research and development



Expenditure on research and development is charged to the statement of
operations in the year in which it is incurred with the exception of
expenditures incurred in respect of the development of major new products where
the outcome of those projects is assessed as being reasonably certain in regards
to viability and technical feasibility. Such expenditure is capitalized and
amortized straight line over the estimated period of sale for each product,
commencing in the year that sales of the product are first made. To date, we
have not capitalized any such expenditures other than certain IPR&D & IP
recorded in connection with certain acquisition or equity transactions.



Income Taxes



We account for income taxes under the asset and liability method. Deferred tax
assets and liabilities are recognized for future tax consequences attributable
to differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which the temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date. Management considers many factors when assessing the likelihood
of future realization of deferred tax assets, including recent earnings
experience by jurisdiction, expectations of future taxable income, and the
carryforward periods available for tax reporting purposes, as well as other
relevant factors. A valuation allowance may be established to reduce deferred
tax assets to the amount that management believes is more likely than not to be
realized. Due to inherent complexities arising from the nature of the business,
future changes in income tax law and variances between actual and anticipated
operating results, management makes certain judgments and estimates. Therefore,
actual income taxes could materially vary from these estimates.


On December 22, 2017, The Tax Cuts and Jobs Act was signed into law and has
resulted in significant change to the U.S corporate income tax system. These
changes include a federal statutory rate reduction from 34% to 21%, a transition
tax, which applies to the repatriation of foreign earnings and profits, the
elimination or reduction of certain domestic deductions and credits and
limitations on the deductibility of interest expense and executive
compensation.

Changes in tax rates and tax laws are accounted for in the period of enactment.

We recognize in the financial statements the impact of a tax position, if that
position is more likely than not to be sustained upon an examination, based on
the technical merits of the position. We record a liability for the difference
between the benefit recognized and measured and the tax position taken or
expected to be taken on our tax return. To the extent that the assessment of
such tax positions changes, the change in estimate is recorded in the period in
which the determination is made. To the extent interest and penalties are not
assessed with respect to uncertain tax positions, amounts accrued will be
reduced and reflected as a reduction of the overall income tax provision.We have
incurred no liability and, therefore, did not need to record interest and
penalties during the year ended September 30, 2020 and 2019.


Foreign Currency



Items included in the financial statements are measured using their functional
currency, which is the currency of the primary economic environment in which the
company operates. The Company's consolidated financial statements are presented
in United States Dollar ("USD"), which is the company's functional and
presentational currency.



Foreign currency transactions are translated using the rate of exchange
applicable at the date of the transaction. Foreign exchange gains and losses
resulting from the settlement of such transactions and from the re-translation
at the year-end of monetary assets and liabilities denominated in foreign
currencies are recognized in the statements of operations.



Net Loss per Share



Basic net loss per share is computed by dividing net loss available to common
shareholders by the weighted average number of common shares outstanding during
the period. Diluted net loss per share includes potentially dilutive securities
such as outstanding options and warrants, using various methods such as the
treasury stock or modified treasury stock method in the determination of
dilutive shares outstanding during each reporting period.



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The following table sets forth potential common shares issuable upon the
exercise of outstanding options, the exercise of warrants and conversion of loan
notes, all of which have been excluded from the computation of diluted weighted
average shares outstanding as they would be anti-dilutive, including the impact
on dilutive net loss per share of in-the-money warrants as per ASC 260-10-45-35
through ASC 260-10-45-37:


                                                               September     September
                                                               30, 2020      30, 2019
Stock options                                                 3,210,050     4,073,675
Warrants                                                      1,926,501     1,926,501
Convertible Notes                                             1,562,319     1,723,333
Total shares issuable upon exercise or conversion             6,698,870     7,723,509




Warrants



In August 2017, in connection with the issuance of equity, we issued a ten year
warrant to purchase 112,000 shares of common stock at an exercise price of $0.65
per share, as offering costs to the placement agents.

In September 2017, in connection with a consultancy services agreement, we issued ten year warrants to purchase 374,000 shares of common stock at an exercise price of $0.60 per share, in lieu of cash payments.

We determined that in accordance with ASC 815-40-25-7, all the warrants are to be classified as equity in stockholder's equity.

Convertible Notes

In August 2018, we entered into a 12% Convertible Promissory Note. The Note has
an original purchase amount of $135,000, bears interest at a rate of 12% per
annum calculated on a 360-day year basis. In July 2019, the maturity of the note
was extended from August 8, 2019 to August 8, 2020, unless earlier paid,
redeemed or converted in accordance with the terms of the Agreement. On August
8, 2020, the note was further extended to September 8, 2020.


In October 2018, we entered into an additional 12% Convertible Promissory Note.
The Note has an original purchase amount of $100,000, bears interest at a rate
of 12% per annum calculated on a 360-day year basis. In July 2019, the maturity
of the note was extended from October 20, 2019 to October 19, 2020, unless
earlier paid, redeemed or converted in accordance with the terms of the
Agreement.


On November 12, 2019, the Company issued a 12% convertible promissory note in
the principal amount of $57,500. The Note has a maturity date of November 12,
2020 and is convertible by the holder at any time into shares of the Company's
common stock at a conversion price equal to the lower of (i) $0.65 per share or
(ii) the price of the next financing during the 180 days after the date of the
Note. If the holder has not converted the Note into common stock by the maturity
date, the Company must repay the outstanding principal amount plus accrued
interest.


On February 7, 2020, the Company issued a  12% convertible promissory note in
the principal amount of $31,000. The Note has a maturity date of  February 7,
2021 and is convertible by the holder at any time into shares of the Company's
common stock at a conversion price equal to the lower of (i) $0.25 per share or
(ii) the price of the next equity financing. If the holder has not converted the
Note into common stock by the maturity date, the Company must repay the
outstanding principal amount plus accrued interest.


On March 20, 2020, the Company issued a  12% convertible promissory note in the
principal amount of $20,000. The Note has a maturity date of  March 20,
2021, and is convertible by the holder at any time into shares of the Company's
common stock at a conversion price equal to the lower of (i) $0.20 per share or
(ii) the price of the next equity financing. If the holder has not converted the
Note into common stock by the maturity date, the Company must repay the
outstanding principal amount plus accrued interest.


On September 22 2020, the Company issued a  12% convertible promissory note in
the principal amount of $35,000. The Note has a maturity date of  September 22
2021, and is convertible by the holder at any time into shares of the Company's
common stock at a conversion price equal to the lower of (i) $0.20 per share or
(ii) the price of the next equity financing. If the holder has not converted the
Note into common stock by the maturity date, the Company must repay the
outstanding principal amount plus accrued interest.


At September 30, 2020, the note originally issued in August 2018 is in default.
As at the date of filing, the notes originally issued in August 2018, October
2018 and November 2020 are also in default.  These notes have been properly
classified as short term and interest for the period of default is being accrued
at 18% per annum as per the Convertible Note Agreement. The Company is in
negotiations with all holders of notes payable to extend the maturity dates of
notes in default and to amend the terms of all the notes issued.

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Equity-Based Payments



ASC Topic 718 "Compensation-Stock Compensation" requires companies to measure
the cost of employee services received in exchange for the award of equity
instruments based on the estimated fair value of the award at the date of grant.
The expense is to be recognized over the period during which an employee is
required to provide services in exchange for the award. We account for shares of
common stock, stock options and warrants issued to employees based on the fair
value of the stock, stock option or warrant, if that value is more reliably
measurable than the fair value of the consideration or services received.



We account for stock options issued and vesting to non-employees in accordance
with ASC Topic 505-50 "Equity -Based Payment to Non-Employees" and accordingly
the value of the stock compensation to non-employees is based upon the
measurement date as determined at either a) the date at which a performance
commitment is reached, or b) at the date at which the necessary performance to
earn the equity instruments is complete. Accordingly the fair value of these
options is being "marked to market" quarterly until the measurement date is
determined.



Accounting Changes


In July 2017, FASB, issued ASU, 2017-11, Earnings Per Share (Topic 260);
Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging
(Topic 815): (Part I) Accounting for Certain Financial Instruments with Down
Round Features, (Part II) Replacement of the Indefinite Deferral. The ASU
applies to issuers of financial instruments with down-round features. It amends
(1) the classification of such instruments as liabilities or equity by revising
the guidance in ASC 815 on the evaluation of whether instruments or embedded
features with down-round provisions must be accounted for as derivative
instruments and (2) the guidance on recognition and measurement of the value
transferred upon the trigger of a down-round feature for equity-classified
instruments by revising ASC 260. The ASU is effective for public business
entities for fiscal years, and interim periods within those fiscal years,
beginning after December 15, 2018.  The Company adopted ASU 2017-11 effective
October 1, 2019 and it did not have a material impact on the Company's
consolidated financial statements.

In June 2018, the FASB issued ASU 2018-07, Compensation - Stock Compensation
(Topic 718): Improvements to Non employee Share Based Payment Accounting, which
simplifies several aspects of the accounting for nonemployee share-based payment
transactions resulting from expanding the scope of Topic 718, to include
share-based payment transactions for acquiring goods and services
from nonemployees. Some of the areas for simplification apply only to nonpublic
entities. The amendments specify that Topic 718 applies to all share-based
payment transactions in which a grantor acquires goods or services to be used or
consumed in a grantor's own operations by issuing share-based payment awards.
The amendments in ASU 2018-07 also clarify that Topic 718 does not apply to
share-based payments used to effectively provide (1) financing to the issuer or
(2) awards granted in conjunction with selling goods or services to customers as
part of a contract accounted for under Topic 606, Revenue from Contracts with
Customers. The amendments in this Update are effective for public business
entities for fiscal years beginning after December 15, 2018, including interim
periods within that fiscal year. Early adoption is permitted. The
Company adopted ASU 2018-07 effective October 1, 2019 and it did not have a
material impact on the Company's consolidated financial statements.




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Recent Accounting Pronouncements

In January 2017, the FASB issued ASU 2017-04, Intangibles -Goodwill and Other
(Topic 350): Simplifying the Test for Goodwill Impairment, which addresses the
concerns over the cost and complexity of the two-step impairment test, and
removes the second step of the test. An entity will apply a one-step
quantitative test and record the amount of goodwill impairment as the excess of
a reporting unit's carrying amount over its fair value, not to exceed the total
amount of goodwill allocated to the reporting unit. The guidance is effective
for annual and interim goodwill impairment tests performed for periods beginning
after December 15, 2019. The Company is currently evaluating the impact
of adopting this guidance on our consolidated financial statements.


In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820):
Disclosure Framework-Changes to the Disclosure Requirements for Fair Value
Measurement. ASU 2018-13 removes certain disclosures, modifies certain
disclosures and adds additional disclosures. The ASU is effective for annual
periods, including interim periods within those annual periods, beginning after
December 15, 2019. Early adoption is permitted. We are currently evaluating the
effect that this update will have on its financial statements and related
disclosures.


In  December 2019,  the  FASB  issued  ASU 2019-12,  Income  Taxes  -
 Simplifying  the  Accounting  for  Income  Taxes  ("ASU 2019-12").  Among other
items, the amendments in ASU 2019-12 simplify the accounting treatment of tax
law changes and year-to-date losses in interim periods. An entity generally
recognizes the effects of a change in tax law in the period of enactment;
however, there is an exception for tax laws with delayed effective dates. Under
current guidance, an entity may not adjust its annual effective tax rate for a
tax law change until the period in which the law is effective. This exception
was removed under ASU 2019-12, thereby providing that all effects of a tax law
change are recognized in the period of enactment, including adjustment of the
estimated annual effective tax rate. Regarding year-to-date losses in interim
periods, an entity is required to estimate its annual effective tax rate for the
full fiscal year at the end of each interim period and use that rate to
calculate its income taxes on a year-to-date basis. However, current guidance
provides an exception that when a loss in an interim period exceeds the
anticipated loss for the year, the income tax benefit is limited to the amount
that would be recognized if the year-to-date loss were the anticipated loss for
the full year. ASU 2019-12 removes this exception and provides that, in this
situation, an entity would compute its income tax benefit at each interim period
based on its estimated annual effective tax rate. ASU 2019-12 is effective for
fiscal years beginning after December 15, 2020, including interim periods within
those annual periods. Early adoption is permitted. The Company is currently
evaluating the effect that this update will have on its financial statements and
related disclosures.

The Company has determined that all other recently issued accounting pronouncements will not have a material impact on its consolidated financial position, results of operations and cash flows, or do not apply to its operations

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Results of Operations

The following paragraphs set forth our results of operations for the periods presented. The period-to-period comparison of financial results is not necessarily indicative of future results.

Results of Operations for the years ended September 30, 2020 and 2019

Revenues

There were no revenues for the year ended September 30, 2020 and 2019 because we do not have any commercial biopharmaceutical products.

Operating Expenses



Operating expenses consisting of research and development costs, consultancy
fees, legal and professional fees and general and administrative expenses for
the year ended September 30, 2020 increase to $5,428,858 from $915,170 for the
year ended September 30, 2019, an increase of $4,513,688. The increase is
primarily attributable to the  impairment and write off of goodwill and
intangible assets of $4,872,354 offset by the pace of development of the
LSD1 and NPM1  projects which decreased while the direction of the programs were
being evaluated based on results achieved so far, along with a decrease in legal
and professional fees and general administrative costs driven by our decreased
activity and a reduction in employees.



Net Loss



Net loss for the year ended September 30, 2020 increase to $5,346,672 from
$936,380 for the year ended September 30, 2019, an increase of $4,410,292. The
increase was due to the impairment and write off of goodwill and intangible
assets of $4,872,354 off set by decreases in the pace of development of the
LSD1 and NPM1 projects which decreased while the direction of the programs are
being evaluated, and a decrease in legal and professional fees and general
administrative costs driven by our decreased activity.

Liquidity and Capital Resources

On November 12, 2019 we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $57,500 in cash, which we received in November 2019.
As at the date of filing this note is in default. The Company is currently
negotiating an extension to the maturity date along with amended terms.


On February 7, 2020, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $31,000 in cash, which we received in February 2020.

On March 20, 2020, we entered into a 12% Convertible Promissory Note with a Holder pursuant to which we issued a Convertible Promissory Note to the Holder. The Holder provided us with $20,000 in cash, which we received in March 2020.

On September 22, 2020, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $35,000 in cash, which we received in September
2020.


On January 12, 2021, Panetta Partners Ltd, a related party, advanced $60,000 to
the Company. This advance will be converted into a promissory note, the terms of
which are currently being negotiated by the Company.


We will be required to raise additional capital to continue the development and
commercialization of current product candidates and to fund operations. We
cannot be certain that additional funding will be available on acceptable terms,
or at all. To the extent that we raise additional funds by issuing equity
securities, our shareholders may experience significant dilution. Any debt
financing, if available, may (i) involve restrictive covenants that impact our
ability to conduct, delay, scale back or discontinue the development and/or
commercialization of one or more product candidates; (ii) seek collaborators for
product candidates at an earlier stage than otherwise would be desirable and on
terms that are less favorable than might otherwise be available; or
(iii) relinquish or otherwise dispose of rights to technologies, product
candidates or products that we would otherwise seek to develop or commercialize
its self on unfavorable terms.



Capital Resources

The following table summarizes total current assets, liabilities and working capital as of the periods indicated:

                            September 30, 2020    September 30, 2019      Change
Current assets             $           32,630    $           71,579    $  (38,949 )
Current liabilities        $        2,707,632    $        2,408,530    $  299,102
Working capital deficiency $       (2,675,002 )  $       (2,336,951 )  $ (338,051 )

We had a cash balance of $14,241 and $50,068 as of September 30, 2020 and September 30, 2019, respectively.

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Liquidity



The following table sets forth a summary of our cash flows for the periods
indicated:



                                             For the year ended     For the year ended
                                               September 30,          September 30,
                                                    2020                   2019            Increase/(Decrease)

Net cash used in operating activities $ (251,327 ) $ (92,625 ) $ (158,702 ) Net cash used in investing activities $

             -        $             -        $                 -

Net cash provided by financing activities $ 215,500 $ 100,000 $

           115,500

Net Cash Used in Operating Activities

Net cash used in operating activities was $251,327 for the year ended September
30, 2020 compared to $92,625 for the year ended September 30, 2019. The change
is principally attributable to net loss of $5,346,672 excluding non-cash items
such as share based compensation of $134,632, an impairment of goodwill and
intangible assets of $4,872,354 and changes in operating assets and liabilities
of $48,320 and for the year ended September 30, 2020 as compared to a net loss
of $936,380, adjusted for non-cash share based compensation of $368,076 and
changes in operating assets and liabilities of $452,225 for the year
ended September 30, 2019.

Net Cash Provided by Financing Activities

Net cash provided by financing activities consists of proceeds from the issuance
of a convertible notes and a related party loan payable of $215,500 during the
year ended September 30, 2020 compared to $100,000 of proceeds from the issuance
of a convertible note during the year ended September 30, 2019.

Off-Balance Sheet Arrangements

We consolidate variable interest entities ("VIE") in which we hold a controlling
financial interest as evidenced by the power to direct the activities of a VIE
that most significantly impact its economic performance and the obligation to
absorb losses of, or the right to receive benefits from, the VIE that could
potentially be significant to the VIE and therefore are deemed to be the primary
beneficiary. We take into account our entire involvement in a VIE (explicit or
implicit) in identifying variable interests that individually or in the
aggregate could be significant enough to warrant our designation as the primary
beneficiary and hence require us to consolidate the VIE or otherwise require us
to make appropriate disclosures. The UK entity which has been consolidated as a
VIE has, at the date of publication of the Annual report, been liquidated.



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