Disclosures Regarding Forward-Looking Statements





This report includes "forward-looking statements" within the meaning of
Section 21E of the Exchange Act. Those statements include statements regarding
the intent, belief or current expectations of the Company and its subsidiaries
and our management team. Any such forward-looking statements are not guarantees
of future performance and involve risks and uncertainties, and actual results
may differ materially from those projected in the forward-looking statements.
These risks and uncertainties include but are not limited to those risks and
uncertainties set forth in Item 1A of this Annual Report on Form 10-K. In light
of the significant risks and uncertainties inherent in the forward-looking
statements included in this Annual Report on Form 10-K, the inclusion of such
statements should not be regarded as a representation by us or any other person
that our objectives and plans will be achieved. Further, these forward-looking
statements reflect our view only as of the date of this report. Except as
required by law, we undertake no obligations to update any forward-looking
statements and we disclaim any intent to update forward-looking statements after
the date of this report to reflect subsequent developments. Accordingly, you
should also carefully consider the factors set forth in other reports or
documents that we file from time to time with the SEC.



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Overview



As a result of the Merger, our going-forward operations will be primarily those
of Legacy NeuBase. Accordingly, the results of operations reported for the
fiscal years ended September 30, 2019 and 2018, in this Management's Discussion
and Analysis are not indicative of the results of operations expected for future
years due to the transition of our historic business operations to primarily
those of Legacy NeuBase.



We are a biotechnology company focused on developing next generation therapies
to treat rare genetic diseases and cancer caused by mutant genes. Given that
perhaps every human disease has a genetic component, we believe that our
differentiated platform technology has the potential for broad impact.



Mutated proteins resulting from errors in deoxyribonucleic acid ("DNA")
sequences cause many rare genetic diseases and cancer. DNA in each cell of the
body is transcribed into pre-RNA, which is then processed (spliced) into mRNA
which is exported into the cytoplasm of the cell and translated into protein.
This is termed the "central dogma" of biology. Therefore, when errors in a DNA
sequence occur, they are propagated to RNAs and can become a damaging protein.



The type of therapies that we are developing are termed ASO therapies. ASOs are
short single strands of nucleic acids (traditionally thought of as single
stranded RNA molecules) which will bind to defective RNA targets in cells and
inhibit their ability to be translated into defective proteins. We believe we
are a leader in the discovery and development of the class of RNA-targeted ASO
drugs called PNAs. Our proprietary PATrOL™ platform allows for a more efficient
discovery of drug product candidates, potentially transforming the treatment
paradigm for people affected by rare genetic diseases and cancer.



The PATrOL™ platform allows for a potentially more efficient discovery of drug
product candidates because of manufacturing consistency and because we are not
constrained by folded regions of the target RNA molecule (secondary structures).
The peptide backbone of our ASOs is rigid, and once linked together to form a
series of backbone subunits, forms a single pre-organized structure. At a more
detailed level, each subunit of the peptide backbone has only a single chiral
center - a point in the chemical structure where the conformation of the
backbone could fluctuate - and this chiral center is locked into one
conformation and thus pre-organized to form only a single conformation or
stereoisomer. A stereoisomer is a term used in the ASO therapeutics field to
mean a string of backbone subunits (usually sugars or modified sugars) with
nuclear bases attached that are linked together into a specific sequence that
matches (complements) the target sequence, but because of the nature of the
backbone subunits used, the drug assumes various conformations often with
varying affinity for the target sequence. These stereoisomers often require a
manufacturing step to purify the heterogeneous mixture of conformations into a
more homogenous mixture or even a single conformation of the drug in order to
obtain the hoped-for therapeutic effect. Our PNAs assume only a single
conformation with any constellation of nuclear bases added to the backbone or
any oligomer length. This backbone also has a neutral charge, as opposed to the
negatively charged backbones of DNA and RNA. This neutral charge allows our ASO
to open up RNAs which are folded upon themselves and bind to their target
sequence. This potentially accelerates identification of drug candidates which
have the desired activity.



In addition to the backbone conformational purity which allows for a more
efficient discovery of drug product candidates, we also have a kit of
proprietary bi-facial or bi-specific nucleotides (traditional nucleotides only
have a single binding face and thus are restricted to only binding
single-stranded RNA targets) which can be used in any combination to access RNA
secondary structures (double stranded RNA targets which are folded upon
themselves) such as hairpins. This allows us to potentially access regions of
the target transcript which may be unique in secondary structure to allow
enhanced selectivity for the target (mutant) RNA vs. the normal RNA. Enhanced
selectivity for mutant RNAs vs. normal RNAs is critical as normal RNAs are
likely required for effective functioning of the cell. These bi-specific
nucleotides can also target genomic loci and microRNAs in their double-stranded
form.

In addition to the backbone and modified nuclear bases, the platform toolkit also includes linker technology which, when added to both ends of the PNAs, allow cooperative binding between individual drug molecules once they are engaged with the target RNA to form longer and more tightly bound drugs.


The final component of the platform is a chemical moiety, which is used to
decorate the peptide backbone in a proprietary manner and allows the PNAs to
penetrate cell membranes and distribute throughout the body when administered
systemically.



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This relatively simple toolkit of components forms the PATrOL™ platform and allows us to manufacture genome and transcript-specific PNAs quickly for screening.


We are currently focused on therapeutic areas in which we believe our drugs will
provide the greatest benefit with a significant market opportunity and intend to
utilize our technology to build out a pipeline of custom designed therapeutics
for additional high-value disease targets. We are developing several preclinical
programs using our PATrOL™ platform, including: NT0100, targeted at HD, a repeat
expansion disorder, and NT0200, targeted at myotonic dystrophy ("DM1").
Preclinical studies are being conducted to evaluate the PATrOL™ platform
technology and program candidates in the areas of pharmacokinetics and
pharmacodynamics, and we expect to report results from those studies beginning
in the first calendar quarter of 2020 and in the second calendar quarter of
2020. In addition, the emerging pipeline of other assets that target primary and
secondary RNA structure and genomic DNA allows a unique market advantage across
a variety of rare diseases and oncology targets.



Using our PATrOL™ platform, we can create ASOs that have distinct potential
advantages over other chemical entities currently in the market or in
development for gene silencing applications. These advantages include, among
others: a backbone that has only one chiral center and thus forms only one
stereoisomer; the ability of the PNA backbone to intercalate, open up secondary
(RNA folded upon itself) and tertiary structures (RNA molecules that interact
with other RNA molecules in the cell) and bind within these double-stranded RNA
in a highly selective manner; a proprietary set of engineered nuclear bases that
increase selectivity to specific target sequences including secondary and
tertiary structures that has been licensed exclusively from CMU; technology to
allow self-assembly of our small gamma-PNA at the RNA target to increase
selectivity which has been licensed exclusively from CMU; the ability to
modulate cell permeability and the ability to pass the blood-brain barrier when
administered systemically; the lack of innate or acquired immune responses of
similar gamma-PNAs in preclinical models; and potential minimal toxicity based
on previous in-vivo studies in rodent models. With these advantages, our PATrOL™
platform-enabled therapies can potentially address a multitude of rare genetic
diseases and cancer, among other indications.



Merger



On July 12, 2019, Ohr completed the Merger. At the closing of the Merger, each
outstanding share of Legacy NeuBase's capital stock was converted into the right
to receive 1.019055643 shares of our common stock. Shares of our common stock
commenced trading on the Nasdaq Capital Market under the ticker symbol "NBSE" as
of market open on July 15, 2019. Our previous ticker symbol was "OHRP".



Results of Operations




Results of operations for the fiscal year ended September 30, 2019 reflect the
following changes from the period from inception (August 28, 2018) to September
30, 2018:



                                                       Period Ended
                                                      September 30,
                                                   2019             2018           Change
General and administrative                     $   9,095,674     $   28,393     $   9,067,281
Research and development                           4,273,318         12,819         4,260,499
Research and development expense- licenses
acquired                                          12,967,415              -        12,967,415
Total Operating Expenses                          26,336,407         41,212        26,295,195

Operating Loss                                   (26,336,407 )      (41,212 )     (26,295,195 )

Interest expense                                    (128,951 )         (740 )        (128,211 )

Change in fair value of warrant liabilities         (492,889 )            -

         (492,889 )
Net Loss                                       $ (26,958,247 )   $  (41,952 )   $ (26,916,295 )
During the fiscal year ended September 30, 2019, we had no revenues and our
operating loss increased by $26,295,195 compared to the period from inception to
September 30, 2018. Our net loss increased by $26,916,295 for the fiscal year
ended September 30, 2019, as compared to the period from inception to September
30, 2018. Until we are able to generate revenues, our management expects to
continue to incur net losses.

General and Administrative Expense





General and administrative expense consists primarily of legal and professional
fees, wages and stock-based compensation. General and administrative expenses
increased by $9,067,281 for the fiscal year ended September 30, 2019, as
compared to the period from inception to September 30, 2018, primarily due to an
increase in stock-based compensation expense, employee head count and need for
legal and professional services.

Research and Development Expense





Research and development expense consist primarily of professional fees,
manufacturing expenses, wages and stock-based compensation. Research and
development expenses increased by $4,260,499 for the fiscal year ended September
30, 2019, as compared to the period from inception to September 30, 2018,
primarily due to an increase in stock-based compensation, employee head count
and the ramp up of research and development before and after the close of the
Merger with Ohr Pharmaceutical.

Research and Development Expense- licenses acquired





Research and development expense- licenses acquired consists of licenses
acquired from CMU and in the Merger with Ohr. Research and development expense-
licenses acquired increased by $12,967,415, for the fiscal year ended September
30, 2019, as compared to the period from inception to September 30, 2018,
primarily due to our acquisition of license rights in 2019.



  67






Interest Expense



Interest income consists primarily of interest on convertible notes and notes
payable. Interest expense increased by $128,211 for the fiscal year ended
September 30, 2019, as compared to the period from inception to September 30,
2018, primarily due to the issuance of convertible notes.

Change in fair value of warrant liabilities


Change in fair value of warrant liabilities reflects the changes in warrant
liabilities primarily due to changes in our stock price. Change in fair value of
warrant liabilities increased by $492,889 for the fiscal year ended September
30, 2019, as compared to the period from inception to September 30, 2018,
primarily due to warrants issued in connection with the CMU License Agreement.

Liquidity, Capital Resources and Financial Condition

We have limited working capital reserves with which to fund our continuing operations. We are reliant, at present, upon our capital reserves for ongoing operations and has no revenues.


Net working capital increased from the fiscal year ended September 30, 2018 to
the fiscal year ended September 30, 2019 by $8,319,118 (to $8,527,222 from
$208,104) primarily due to cash proceeds from financings completed in July 2019.
Our quarterly cash burn has increased significantly compared to the prior period
from inception to September 30, 2018 due to increased research and development
activities and costs associated with the Merger. We anticipate that our cash
needs will increase relative to prior periods as we achieve progress with our
research and development objectives. Alongside the closing of the Merger, in
July 2019, we completed two financings raising gross proceeds of approximately
$14 million, and we believe that our current cash balance will provide
sufficient capital to continue operations to the end of fiscal 2020. At present,
we have no bank line of credit or other fixed source of capital reserves. Should
we need additional capital in the future, we will be primarily reliant upon
private or public placement of our equity or debt securities, or a strategic
transaction, for which there can be no warranty or assurance that we may be
successful in such efforts.

Contractual Obligations and Commitments





Leases



From inception through the year ended September 30, 2018, Legacy NeuBase
utilized the services of LifeX Labs LLC. These services included accounting
consultation and office space rental. This agreement was terminated on January
8, 2019. Dietrich Stephan, our Chief Executive Officer ("CEO"), was on the board
and acting as CEO of LifeX Labs LLC until December 28, 2018, when he resigned
all positions within LifeX. During the period from August 28, 2018 (inception)
to September 30, 2018 and the year ended September 30, 2019, LifeX Labs was paid
$1,575 and $10,628, respectively, by Legacy NeuBase.



On March 12, 2019, we entered into a sublease agreement with StartUptown. The
monthly rent on the one year sublease is $2,532 and we provided a security
deposit of $2,532 upon signature of the agreement. The total sublease liability
for the term of the sublease is $30,381 excluding the security deposit. The
sublease includes an option to extend the agreement for up to six months. On May
21, 2019, we entered into an amendment to the sublease agreement with
StartUptown to increase our office space, whereby the monthly rent on the one
year sublease was increased from $2,532 to $4,521 per month. All other material
terms remained the same. On July 29, 2019, we entered into a second amendment to
the sublease agreement with StartUptown to increase our office space, whereby
the monthly rent on the sublease was increased from $4,521 to $6,883 per month.
All other material terms remained the same.



Cash Flow Summary



The following table summarizes selected items in our consolidated statements of
cash flows:



                                                      For the Year Ended        For the Period From August 28,
                                                        September 30,          2018 (Inception) to September 30,
                                                             2019                            2018

Net cash used in operating activities                $         (2,845,488 )   $                              (455 )
Net cash used in investing activities                            (685,225 )                                     -
Net cash provided by financing activities                      13,595,079                                 250,055
Net increase in cash and cash equivalents            $         10,064,366  

  $                           249,600

Operating Activities from Continuing Operations





Net cash used in operating activities from continuing operations was
approximately $2.8 million for the fiscal year ended September 30, 2019 and net
cash used in operating activities from continuing operations was approximately
$455 for the period from inception to September 30, 2018. Net cash used in
operating activities from continuing operations in 2019 was primarily as a
result of our net loss, offset by our stock-based compensation expense and
research and development expense-licenses acquired.

Investing Activities from Continuing Operations





Net cash used in investing activities from continuing operations was
approximately $685 thousand for the fiscal year ended September 30, 2019 and net
cash used in investing activities from continuing operations was $0 for the
period from inception to September 30, 2018. Net cash used in investing
activities in 2019 was primarily as a result of transaction costs paid in
connection with the Merger with Ohr and the acquisition of the CMU License as
well as the purchase of laboratory and office equipment. These expenditures were
partially offset by cash acquired in connection with the Merger with Ohr.



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Financing Activities From Continuing Operations





Net cash provided by financing activities was approximately $13.6 million for
the fiscal year ended September 30, 2019 and net cash provided by financing
activities was approximately $250 thousand for the period from inception to
September 30, 2018. Net cash provided by financing activities in 2019 reflects
the proceeds from the issuance of common stock in our pre-acquisition and
private placement financings. Net cash provided by financing activities in 2019
also reflects the proceeds from the issuance of convertible notes.

Off-Balance Sheet Arrangements

As of September 30, 2019, we did not have any off-balance sheet arrangements as defined in Item 303(a)(4)(ii) of Regulation S-K.

Recent Accounting Pronouncements


In June 2018, the Financial Accounting Standards Board (the "FASB") issued
Accounting Standard Update ("ASU") 2018-07, Compensation- Stock Compensation
(Topic 718) Improvements to Nonemployee Share-Based Payment Accounting, which
expands the scope of Topic 718 to include share-based payment transactions for
acquiring goods and services from nonemployees. The guidance also specifies 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 Company early adopted this standard
as of October 1, 2018. The Company did not grant share-based payment awards
during the period from August 28, 2018 (inception) through September 30, 2018.
Accordingly, the adoption of this standard did not have a material effect on the
Company's consolidated financial statements and related disclosures.



In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers
(Topic 606), which requires entities to recognize revenue in a way that depicts
the transfer of promised goods or services to customers in an amount that
reflects the consideration to which the entity expects to be entitled in
exchange for those goods or services. The new guidance also requires additional
disclosure about the nature, amount, timing and uncertainty of revenue and cash
flows arising from customer contracts. The FASB subsequently issued ASU 2016-10,
Revenue from Contracts with Customers: (Topic 606) Identifying Performance
Obligations and Licensing, to address issues arising from implementation of the
new revenue recognition standard. The Company adopted the standard using the
full retrospective method. The Company does not currently have a revenue stream.
Accordingly, the adoption of this standard did not have a material effect on the
Company's consolidated financial statements and related disclosures.



In February 2016, the FASB issued ASU 2016-2, Leases. The new standard
establishes a right-of-use ("ROU") model that requires a lessee to record a ROU
asset and a lease liability on the balance sheet for all leases with terms
longer than 12 months. Leases will be classified as either finance or operating,
with classification affecting the pattern of expense recognition in the income
statement. The new standard is effective for fiscal years beginning after
December 15, 2018, including interim periods within those fiscal years. A
modified retrospective transition approach is required for lessees for capital
and operating leases existing at, or entered into after, the beginning of the
earliest comparative period presented in the financial statements, with certain
practical expedients available. The Company plans to adopt this standard on
October 1, 2019. The adoption of the standard is not expected to have a material
effect on the Company's consolidated financial statements and related
disclosures as the Company does not currently have leases with terms longer

than
12 months.

Critical Accounting Estimates and Policies





Our management's discussion and analysis of our financial condition and results
of operations is based on our financial statements, which have been prepared in
accordance with United States generally accepted accounting principles ("GAAP").
The preparation of these financial statements requires us to make estimates,
judgments and assumptions that affect the reported amounts of assets and
liabilities, disclosure of contingent assets and liabilities as of the date of
the balance sheet and the reported amounts of expenses during the reporting
period. In accordance with GAAP, we evaluate our estimates and judgments on an
ongoing basis. The most significant estimates relate to the valuation of
share-based compensation, the valuation of licenses, the fair value of warrant
liabilities and the valuation allowance of deferred tax assets resulting from
net operating losses. We base our estimates and assumptions on current facts,
our limited historical experience from operations and various other factors that
we believe are reasonable under the circumstances, the results of which form the
basis for making judgments about the carrying value of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from
these estimates under different assumptions or conditions.



We define our critical accounting policies as those accounting principles that
require it to make subjective estimates and judgments about matters that are
uncertain and are likely to have a material impact on our financial condition
and results of operations, as well as the specific manner in which we apply
those principles. While our significant accounting policies are more fully
described in Note 2 to our financial statements appearing elsewhere in this
Annual Report on Form 10-K, we believe the following are the critical accounting
policies used in the preparation of our financial statements that require
significant estimates and judgments:



Use of Estimates



The preparation of financial statements in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements and the reported
amounts of revenue and expenses during the reporting period. Actual results
could differ from those estimates.



  69






Cash and Cash Equivalents



We consider all highly-liquid investments purchased with short term maturities
to be cash equivalents. We had cash equivalents as of September 30, 2019 and did
not have any cash equivalents as of September 30, 2018.

Fair Value of Financial Instruments





In accordance with Accounting Standards Codification ("ASC") 820, the carrying
value of cash and cash equivalents, accounts payable and notes payable
approximates fair value due to the short-term maturity of these instruments. ASC
820 clarifies the definition of fair value, prescribes methods for measuring
fair value, and establishes a fair value hierarchy to classify the inputs used
in measuring fair value as follows:



      ?  Level 1 - Quoted prices in active markets for identical assets or
         liabilities on the reporting date.

      ?  Level 2 - Pricing inputs are based on quoted prices for similar
         instruments in active markets, quoted prices for identical or similar

instruments in markets that are not active and model-based valuation


         techniques for which all significant assumptions are observable in the
         market or can be corroborated by observable market data for
         substantially the full term of the assets or liabilities.

      ?  Level 3 - Pricing inputs are generally unobservable and include
         situations where there is little, if any, market activity for the
         investment. The inputs into the determination of fair value require
         management's judgment or estimation of assumptions that market
         participants would use in pricing the assets or liabilities. The fair

values are therefore determined using factors that involve considerable


         judgment and interpretations, including but not limited to private and
         public comparables, third-party appraisals, discounted cash flow models
         and fund manager estimates.

As of September 30, 2019, the fair value of outstanding warrant liabilities measured at fair value on a recurring basis was $496,343. The warrant liabilities are valued using Level 3 valuation inputs. There were no outstanding warrant liabilities as of September 30, 2018.

As of September 30, 2019 and 2018, the recorded values of cash and cash equivalents, accounts payable and the insurance note payable, approximate the fair values due to the short-term nature of the instruments.





Research and Development



Research and development expenses are expensed in the statement of operations as
incurred in accordance with the Financial Accounting Standards Board ("FASB")
ASC 730, Research and Development. Research and development expenses include
patent and certain legal fees. We incurred net research and development expenses
of $12,819 from inception to September 30, 2018. During the fiscal year ended
September 30, 2019, we incurred $4,273,318 in research and development expenses.



Share-Based Compensation




We follow the provisions of ASC 718 - Stock Compensation which requires all
share-based payments to employees, including grants of employee stock options,
be recognized in the income statement based on their fair values. We have early
adopted Accounting Standard Update ("ASU") 2018-07, which expands the scope of
ASC 718 to include share based payments granted to nonemployees and supersedes
the guidance in ASC 505-50. The Company estimates the fair value of stock option
grants using the Black-Scholes option pricing model, and the assumptions used in
calculating the fair value of stock-based awards represent management's best
estimates and involve inherent uncertainties and the application of management's
judgment.




Stock-based compensation expense is recognized in our financial statements on a
straight-line basis over for each separately vesting portion of the award. The
stock-based compensation awards generally vest over a period of up to four
years. All stock-based compensation costs are recorded in general and
administrative or research and development costs in the consolidated statements
of operations based upon the underlying individual's role at the Company.



Income taxes



Income taxes are recorded in accordance with Accounting Standards Codification
Topic 740, Income Taxes ("ASC 740"), which provides for deferred taxes using an
asset and liability approach. We recognize deferred tax assets and liabilities
for the expected future tax consequences of events that have been included in
the financial statements or tax returns. Deferred tax assets and liabilities are
determined based on the difference between the financial statement and tax bases
of assets and liabilities using enacted tax rates in effect for the year in
which the differences are expected to reverse. Valuation allowances are
provided, if based upon the weight of available evidence, it is more likely than
not that some or all of the deferred tax assets will not be realized.



We account for uncertain tax positions in accordance with the provisions of ASC
740. When uncertain tax positions exist, we recognize the tax benefit of tax
positions to the extent that the benefit would more likely than not be realized
assuming examination by the taxing authority. The determination as to whether
the tax benefit will more likely than not be realized is based upon the
technical merits of the tax position as well as consideration of the available
facts and circumstances. NeuBase recognizes any interest and penalties accrued
related to unrecognized tax benefits as income tax expense.



The Tax Cuts and Jobs Act (the "Act") was enacted on December 22, 2017. The Act
reduces the US federal corporate tax rate from 35% to 21%, and among other
changes, eliminates net operating loss carrybacks for losses arising in taxable
years beginning after December 31, 2017. Further, operating losses arising in
tax years after December 31, 2017, are carried forward indefinitely. The Act did
not result in any material changes to our financial statements or results of
operations.



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