UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

 FORM 10-K

 (Mark One)

 ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the fiscal year ended December 31,
 2023

 OR

 TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from: __________ to __________

 Commission File Number: 001-38105

 180 LIFE SCIENCES CORP.

 (Exact name of registrant as specified in its charter)

 Delaware

 90-1890354

 (State or other jurisdiction of

incorporation or organization)

 ( I.R.S. Employer

Identification No.)

 3000 El Camino Real, Bldg. 4, Suite 200
 Palo Alto, CA

 94306

 (Address of Principal Executive Offices)

 (Zip Code)

 Registrant's telephone number, including
area code: (650) 507-0669

 Securities registered pursuant to Section 12(b) of the Act:

 Title of each class

 Trading Symbol(s)

 Name of each exchange on which registered

 Common Stock, par value $0.0001 per share

 ATNF

 The NASDAQ Stock Market LLC (NASDAQ Capital Market)

 Warrants to purchase shares of Common Stock

 ATNFW

 The NASDAQ Stock Market LLC (NASDAQ Capital Market)

 Securities registered pursuant to Section 12(g) of
the Act:

 None.

 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

 Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

(1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes No

has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files). Yes No

is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See the definitions of " large accelerated filer, " " accelerated filer " and " smaller reporting
company " and " emerging growth company " in Rule 12b-2 of the Exchange Act.

 Large accelerated filer

 Accelerated filer

 Non-accelerated filer

 Smaller reporting company

 Emerging growth

 If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.

has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its audit report.

 If securities are registered pursuant to Section
12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction
of an error to previously issued financial statements.

 Indicate by check mark whether any of those error
corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's
executive officers during the relevant recovery period pursuant to §240.10D-1(b).

is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

 The aggregate market value of the voting and non-voting
common stock held by non-affiliates of the registrant as of the last business day of the registrant's most recently completed second
fiscal quarter was $ 5,850,736. For purposes of calculating the aggregate market value of shares held by non-affiliates, we have assumed
that all outstanding shares are held by non-affiliates, except for shares held by each of our executive officers, directors and 5% or
greater stockholders. In the case of 5% or greater stockholders, we have not deemed such stockholders to be affiliates unless there are
facts and circumstances which would indicate that such stockholders exercise any control over our company, or unless they hold 10% or
more of our outstanding common stock. These assumptions should not be deemed to constitute an admission that all executive officers, directors
and 5% or greater stockholders are, in fact, affiliates of our company, or that there are not other persons who may be deemed to be affiliates
of our company. Further information concerning shareholdings of our officers, directors and principal stockholders is incorporated by
reference in Part III, Item 12 of this Annual Report on Form 10-K.

 As of March 22, 2024, there were 852,772 shares
of common stock issued and outstanding.

 DOCUMENTS INCORPORATED BY REFERENCE

 Portions of the registrant's definitive
proxy statement relating to its 2024 annual meeting of shareholders (the " 2024 Proxy Statement ") are incorporated by
reference into Part III of this Annual Report on Form 10-K where indicated. The 2024 Proxy Statement will be filed with the U.S. Securities
and Exchange Commission within 120 days after the end of the fiscal year to which this report relates.

 Auditor Firm Id: 688
 Auditor Name: Marcum, LLP
 Auditor Location: San Francisco, CA

 Glossary

 Ii

 Cautionary Statement Regarding Forward-Looking Information

 VI

 Item 1. Business.

 Item 1A. Risk Factors.

 Item 1B. Unresolved Staff Comments.

 Item 1C. Cybersecurity.

 Item 2. Properties.

 Item 3. Legal Proceedings.

 Item 4. Mine Safety Disclosures.

 Item 5. Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item 6. [Reserved]

 Item 7. Management's Discussion and Analysis of Financial Condition and
 Results of Operations.

 Item 7A. Quantitative and Qualitative Disclosures About Market Risk.

 Item 8. Financial Statements and Supplemental Data.

 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.

 Item 9A. Controls and Procedures.

 Item 9B. Other Information.

 Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections.

 Item 10. Directors, Executive Officers and Corporate Governance.

 Item 11. Executive Compensation.

 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

 Item 13. Certain Relationships and Related Transactions, and Director Independence.

 Item 14. Principal Accountant Fees and Services.

 Item 15. Exhibits, Financial Statements and Schedules

 Item 16. Form 10–K Summary

 i

 Glossary

 The following are abbreviations
and definitions of certain terms used in this Report, which are commonly used in the pharmaceutical and biotechnology industry:

 " ACA " means
the Patient Protection and Affordable Care Act, often shortened to the Affordable Care Act, nicknamed Obamacare, which is a U.S. federal
statute which provides numerous rights and protections that make health coverage fairer and easier to understand, along with subsidies
(through " premium tax credits " and " cost-sharing reductions ") to make it more affordable. The
law also expands the Medicaid program to cover more people with low incomes.

 " Analgesics "
are a class of medications designed specifically to relieve pain.

 " ANDA "
means an abbreviated new drug application which contains data which is submitted to the FDA for the review and potential approval of a
generic drug product.

 " Anti-TNF "
is a pharmaceutical drug that suppresses the physiologic response to TNF.

 " BLA " means
the FDA's Biologics License Application, which is the vehicle in the United States through which biologic sponsors formally propose
that the FDA approve a new biologic for sale and marketing.

 "BPCIA" means
the Biologics Price Competition and Innovation Act.

 " Cannabinoids "
mean compounds found in cannabis sativa L., and when used throughout this Report, refer to compounds found in the hemp plant
which do not contain THC.

 " CBD " or
cannabidiol is an active ingredient in cannabis derived from the hemp plant. CBD is a non-psychoactive oxidative degradation product of
THC.

 " CBG " or
cannabigerol is one of the compounds found in the cannabis plant.

 " CCMO "
means De Centrale Commissie Mensgebonden Onderzoek (CCMO), or the Central Committee on Research Involving Human Subjects, the organization
responsible for reviewing and regulating medical research involving human subjects in The Netherlands.

 " CHMP "
means the Committee for Medicinal Products for Human Use, formerly known as the Committee for Proprietary Medicinal Products, which is
the European Medicines Agency's committee responsible for elaborating the agency's opinions on all issues regarding medicinal
products for human use.

 " CMS " means
the Centers for Medicare & Medicaid Services, which is a federal agency within the HHS that administers the Medicare program and works
in partnership with state governments to administer Medicaid.

 " Corticosteroids "
are a class of drug that lowers inflammation in the body.

 " CRO " means
a contract research organization which is a company that provides support to the pharmaceutical, biotechnology, and medical device industries
in the form of research services outsourced on a contract basis.

 " CSA " means
the Controlled Substances Act, the statute establishing federal U.S. drug policy under which the manufacture, importation, possession,
use, and distribution of certain substances is regulated.

 " CTA " means
a Clinical Trial Application, which is a submission to the competent National Regulatory Authority(ies) for obtaining authorization to
conduct a clinical trial in a specific country. It is an application with necessary information on investigational medicinal products.
The purpose of a CTA is to provide all the important details about the clinical trial to the health authorities in order to obtain the
product approval.

 ii

 " DEA " means
the Drug Enforcement Administration, a United States federal law enforcement agency under the United States Department of Justice, tasked
with combating drug trafficking and distribution within the United States.

 " EMA " means
the European Medicines Agency, an agency of the EU in charge of the evaluation and supervision of medicinal products.

 " ETASU "
means elements to assure safe use, which are one of several strategies that may be required in order to mitigate risk of medication use
pursuant to a REMS.

 " EU " means
the European Union.

 " FDA " means
U.S. The Food and Drug Administration, which is a federal agency of the United States Department of Health and Human Services. The FDA
is responsible for protecting the public health by ensuring the safety, efficacy, and security of human and veterinary drugs, biological
products, and medical devices; and by ensuring the safety of U.S. food supply, cosmetics, and products that emit radiation.

 " FDC Act "
means the Federal Food, Drug and Cosmetic Act, which is a set of U.S. laws passed by Congress in 1938 giving authority to the FDA to oversee
the safety of food, drugs, medical devices, and cosmetics.

 " FS " means
Frozen Shoulder, a condition characterized by stiffness and pain in an individual's shoulder joint.

 " GCP " means
good clinical practice, which is an international quality standard, which governments can then transpose into regulations for clinical
trials involving human subjects. GCP follows the International Council on Harmonisation of Technical Requirements for Registration of
Pharmaceuticals for Human Use (ICH), and enforces tight guidelines on ethical aspects of clinical research.

 " GLP " means
good laboratory practice, which is a quality system concerned with the organization process and the conditions under which non-clinical
health and environmental safety studies are planned, performed, monitored, recorded, archived and reported.

 " GMP " means
good manufacturing practice regulations promulgated by the FDA under the authority of the FDC Act. These regulations, which have the force
of law, require that manufacturers, processors, and packagers of drugs, medical devices, some food, and blood take proactive steps to
ensure that their products are safe, pure, and effective.

 " HHS " means
the U.S. Department of Health and Human Services also known as the Health Department, a cabinet-level department of the U.S. federal government
with the goal of protecting the health of all Americans and providing essential human services.

 " HIPAA "
means the Health Insurance Portability and Accountability Act of 1996, which has the goal of making it easier for people to keep health
insurance, protect the confidentiality and security of healthcare information and help the healthcare industry control administrative
costs.

 " HMGB1 "
means High Mobility Group Box 1, a protein that, in humans, is encoded by the HMGB1 gene. Activated macrophages and monocytes secrete
HMGB1 as a cytokine mediator of inflammation.

 "IBD" means inflammatory
bowel disease, an umbrella term used to describe disorders that involve chronic inflammation of the digestive tract.

 " IND " means
investigational new drug application. Before a clinical trial can be started, the research must be approved. An investigational new drug
or IND application or request must be filed with the FDA when researchers want to study a drug in humans. The IND application must contain
certain information, such as: results from studies so that the FDA can decide whether the treatment is safe for testing in people; how
the drug is made, who makes it, what's in it, how stable it is, and more; detailed outlines for the planned clinical studies, called
study protocols, are reviewed to see if people might be exposed to needless risks; and details about the clinical trial team to see if
they have the knowledge and skill to run clinical trials.

 iii

 " Individually identifiable
health information " is defined by HIPPA to mean information that is a subset of health information, including demographic information
collected from an individual, and: (1) is created or received by a health care provider, health plan, employer, or health care clearinghouse;
and (2) relates to the past, present, or future physical or mental health or condition of an individual; the provision of health
care to an individual; or the past, present, or future payment for the provision of health care to an individual; and (a) that identifies
the individual; or (b) with respect to which there is a reasonable basis to believe the information can be used to identify the individual.

 " IRB " means
an Institutional Review Board, which is a group that has been formally designated to review and monitor biomedical research involving
human subjects. In accordance with FDA regulations, an IRB has the authority to approve, require modifications in (to secure approval),
or disapprove research. This group serves an important role in the protection of the rights and welfare of human research subjects.

 " Medicaid "
is a federal and state health insurance program in the U.S. that helps with medical costs for some people with limited income and resources.
Medicaid also offers benefits not normally covered by Medicare, including nursing home care and personal care services.

 " Medicare "
is a national health insurance program in the U.S. It primarily provides health insurance for Americans aged 65 and older, but also for
some younger people with disability status as determined by the Social Security Administration, as well as people with end stage renal
disease and amyotrophic lateral sclerosis (ALS or Lou Gehrig's disease).

 " MHRA "
means The Medicines and Healthcare products Regulatory Agency, an executive agency of the Department of Health and Social Care in the
United Kingdom which is responsible for ensuring that medicines and medical devices work and are acceptably safe.

 " MRP " means
a Mutual Recognition Procedure, a market authorization which is granted in one EU member state and is recognized in other EU member states.

 " NCE " is
a drug that does not contain any active moiety that has been approved by the FDA with any other application.

 " NDA " or
" Full NDA " means the FDA's New Drug Application submitted under section 505(b)(1) of the FDC Act, which is a
regulatory vehicle in the United States through which drug sponsors formally propose that the FDA approve a new pharmaceutical for sale
and marketing, that requires the applicant to conduct all investigations necessary for approval.

 " NIHR "
means The National Institute for Health Research is a United Kingdom government agency which funds research into health and care, and
is the largest national clinical research funder in Europe.

 " Orphan Drug Designation "
means a pharmaceutical agent developed to treat medical conditions which, because they are so rare, would not be profitable to produce
without government assistance.

 " Phase 1 "
trials are typically where the drug is initially introduced into healthy human subjects and tested for safety, dosage tolerance, absorption,
metabolism, distribution and elimination. In the case of some drug candidates for severe or life-threatening diseases, such as cancer,
especially when the drug candidate may be inherently too toxic to ethically administer to healthy volunteers, the initial human testing
is often conducted in patients.

 " Phase 2 "
trials are generally when clinical trials are initiated in a limited patient population intended to identify possible adverse effects
and safety risks, to preliminarily evaluate the efficacy of the drug candidate for specific targeted diseases and to determine dosage
tolerance and optimal dosage. Phase 2 trials are sometimes further divided into: Phase 2a and Phase 2b trials — Phase 2a is focused
specifically on dosing requirements. A small number of patients are administered the drug in different quantities to evaluate whether
there is a dose-response relationship, which is an increase in response that correlates with increasing increments of dose. In addition,
the optimal frequency of dose is also explored; and Phase 2b trials are designed specifically to rigorously test the efficacy of the drug
in terms of how successful it is in treating, preventing or diagnosing a disease.

 iv

 " Phase 3 "
trials are when clinical trials are undertaken to further evaluate dosage, clinical efficacy and safety in an expanded patient population
at geographically dispersed clinical trial sites. These clinical trials are intended to establish the overall risk-benefit ratio of the
drug candidate and provide an adequate basis for regulatory approval and product labeling.

 " Phase 4 "
trials are studies required to be conducted as a condition of approval in order to gather additional information on the drug's effect
in various populations and any side effects associated with long-term use.

 " PHS Act "
means the Public Health Service Act, a set of U.S. laws passed by Congress in 1944 which, among other things, provide statutory authority
for the FDA to regulate biological products.

 " Physiotherapy "
is treatment to restore, maintain, and make the most of a patient's mobility, function, and well-being.

 " POCD "
means post-operative cognitive dysfunction/delirium.

 " RA " means
rheumatoid arthritis.

 " REMS "
means a risk evaluation and mitigation strategy which is a drug safety program that the FDA can require for certain medications with serious
safety concerns to help ensure the benefits of the medication outweigh its risks.

 " SCA " means
Synthetic Cannabidiol Analogs, which are synthetic pharmaceutical grade molecules close or distant analogs of non-psychoactive cannabinoids
such as CBD for the treatment of inflammatory diseases and pain.

 " Section 505(b)(2)
NDA " or " section 505(b)(2) application " means a New Drug Application submitted under section 505(b)(2) of
the FDC Act, which is a regulatory vehicle in the United States through which drug sponsors formally propose that the FDA approve a pharmaceutical
for sale and marketing, that allows the applicant to rely on previous investigations conducted by others and for which the sponsor does
not have a right of reference or use from the person by or for whom the investigations were conducted.

 " Sponsor "
means the applicant or drug sponsor, which is the person or entity who assumes responsibility for the marketing of a new drug, including
responsibility for compliance with applicable provisions of the FSC Act and related regulations. Note that as used herein the
term "Sponsor" may also refer to the Sponsor of our IPO, KBL IV Sponsor LLC, depending on the context in which such term is
used.

 " THC " means
tetrahydrocannabinol, which is the principal psychoactive constituent of cannabis.

 " TNF " means
tumor necrosis factor, which is part of the body's response to inflammation.

 " U.K. "
means the United Kingdom.

 " U.S. "
means the United States.

 v

 Cautionary Statement
Regarding Forward-Looking Information

 This Annual Report on Form
10-K (this "Report") contains forward-looking statements under federal securities laws, including within the meaning
of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by the following words:
"anticipate," "believe," "continue," "could," "estimate," "expect,"
"intend," "may," "ongoing," "plan," "potential," "predict," "project,"
"should," or the negative of these terms or other comparable terminology, although not all forward-looking statements contain
these words. Forward-looking statements are not a guarantee of future performance or results and will not necessarily be accurate indications
of the times at, or by, which such performance or results will be achieved. Forward-looking statements are based on information available
at the time the statements are made and involve known and unknown risks, uncertainties and other factors that may cause our results, levels
of activity, performance or achievements to be materially different from the information expressed or implied by the forward-looking statements
in this Report, including those described under the heading "Risk Factors" contained in Item 1A of this Report.

 In particular, forward-looking
statements include, but are not limited to, any statements that are not statements of current or historical facts, such as statements
relating to our expectations for the clinical and preclinical development, manufacturing, regulatory approval, and commercialization of
our product candidates, the accuracy of our estimates regarding expenses, future revenues and capital requirements, our ability to execute
our plans to develop and market new drug products and the timing and costs of these development programs, and estimates of the sufficiency
of our existing capital resources combined with future anticipated cash flows to finance our operating requirements.

 Forward-looking statements
include, but are not limited to, statements about:

 The need for additional funding, our ability to raise funding in the future, the terms of such funding, and dilution caused thereby;

 Expectations for the clinical and preclinical development, manufacturing, regulatory approval, and commercialization of our product candidates;

 the uncertainties associated with the clinical development and regulatory approval of the Company's drug candidates, including potential delays in the enrollment and completion of clinical trials, issues raised by the U.S. Food and Drug Administration (FDA), the European Medicines Agency (EMA) and the U.K. Medicines and Healthcare products Regulatory Agency (MHRA);

 regulatory developments in the United States and foreign countries;

 our success in retaining or recruiting, or changes required in, our officers, key employees or directors;

 current negative operating cash;

 the continued impact of the COVID-19 pandemic on our business operations and our research and development initiatives;

 the accuracy of our estimates regarding expenses, future revenues and capital requirements;

 the Company's reliance on third parties to conduct its clinical trials, enroll patients, and manufacture its preclinical and clinical drug supplies;

 the ability to come to mutually agreeable terms with such third parties and partners, and the terms of such agreements, the terms of the Company's current licensing agreements, and the termination rights associated therewith;

 vi

 estimates of patient populations for the Company's planned products;

 unexpected adverse side effects or inadequate therapeutic efficacy of drug candidates that could limit approval and/or commercialization, or that could result in recalls or product liability claims;

 the Company's ability to fully comply with numerous federal, state and local laws and regulatory requirements, as well as rules and regulations outside the United States, that apply to its product development activities;

 challenges and uncertainties inherent in product research and development, including the uncertainty of clinical success and of obtaining regulatory approvals; and uncertainty of commercial success;

 the ability of the Company to execute its plans to develop and market new drug products and the timing and costs of these development programs;

 changing inflation and interest rates, and economic downturns, including potential recessions, as well as macroeconomic, geopolitical, health and industry trends, pandemics, acts of war (including the ongoing Ukraine/Russian conflict, and Israel/Hamas conflict) and other large-scale crises;

 estimates of the sufficiency of our existing capital resources combined with future anticipated cash flows to finance our operating requirements;

 our ability to maintain the listing of our common stock and warrants on NASDAQ, including our current non-compliance with Nasdaq's continued listing rules; and

 other risks and uncertainties, including those described under "Risk Factors", below.

 Any forward-looking statements
in this Report reflect our current views with respect to future events or to our future financial performance and involve known and unknown
risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from
any future results, performance or achievements expressed or implied by these forward-looking statements. Given these uncertainties,
you should not place undue reliance on these forward-looking statements. All forward-looking statements included herein speak only as
of the date of the filing of this Report. All subsequent written and oral forward-looking statements attributable to the Company, or persons
acting on its behalf, are expressly qualified in their entirety by the cautionary statements above. Except as required by law, we assume
no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future.

 vii

 Item 1. Business.

 INTRODUCTION

 General

 The information included in
this Annual Report on Form 10-K should be read in conjunction with the consolidated financial statements and related notes included at
the end of this report.

 Please see the "Glossary"
above for a list of biotechnology industry abbreviations and definitions used throughout this Report.

 Our logo and some of our trademarks
and tradenames are used in this Report. This Report also includes trademarks, tradenames and service marks that are the property of others.
Solely for convenience, trademarks, tradenames and service marks referred to in this Report may appear without the, and
SM symbols. References to our trademarks, tradenames and service marks are not intended to indicate in any way that we will not assert
to the fullest extent under applicable law our rights or the rights of the applicable licensors if any, nor that respective owners to
other intellectual property rights will not assert, to the fullest extent under applicable law, their rights thereto. We do not intend
the use or display of other companies' trademarks and trade names to imply a relationship with, or endorsement or sponsorship of
us by, any other companies.

 The market data and certain
other statistical information used throughout this Report are based on independent industry publications, reports by market research firms
or other independent sources that we believe to be reliable sources; however, we have not commissioned any of the market or survey data
that is presented in this Report. Industry publications and third-party research, surveys and studies generally indicate that their information
has been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information.
We are responsible for all of the disclosures contained in this Report, and we believe these industry publications and third-party research,
surveys and studies are reliable. While we are not aware of any misstatements regarding any third-party information presented in this
Report, their estimates, in particular, as they relate to projections, involve numerous assumptions, are subject to risks and uncertainties,
and are subject to change based on various factors, including those discussed under the section entitled "Risk Factors" of
this Report. These and other factors could cause our future performance to differ materially from our assumptions and estimates. Some
market and other data included herein, as well as the data of competitors as they relate to 180 Life Sciences Corp., is also based on
our good faith estimates.

 Our fiscal year ends on December
31. Interim results are presented on a quarterly basis for the quarters ended March 31, June 30, and September 30, the first quarter,
second quarter and third quarter, respectively, with the quarter ended December 31st being referenced herein as our fourth quarter. Fiscal
2023 means the year ended December 31, 2023, whereas fiscal 2022 means the year ended December 31, 2022.

 Reverse Stock Split

 December 2022 Reverse Stock Split

 On December 15, 2022, at a
Special Meeting of the Stockholders of 180 Life Sciences Corp., the stockholders of the Company approved an amendment to the Company's
Second Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares
of our common stock, par value $0.0001 per share, by a ratio of between one-for-four to one-for-twenty, inclusive, with the exact ratio
to be set at a whole number to be determined by our Board of Directors or a duly authorized committee thereof in its discretion, at any
time after approval of the amendment and prior to December 15, 2023 (the "Stockholder Authority"). On December 15, 2022, the
Company's Board of Directors (the "Board"), with the Stockholder Authority, approved an amendment to our Second Amended
and Restated Certificate of Incorporation to affect a reverse stock split of our common stock at a ratio of 1-for-20 (the "Reverse
Stock Split").

 Immediately after the Special
Meeting and the approval thereof by the Board, on December 15, 2022, we filed a Certificate of Amendment to our Second Amended and Restated
Certificate of Incorporation (the "Certificate of Amendment") with the Secretary of State of the State of Delaware to effect
the Reverse Stock Split.

 Pursuant to the Certificate
of Amendment, the Reverse Stock Split became effective on December 19, 2022 at 12:01 a.m. Eastern Time (the "Effective Time").
No change was made to the trading symbol for the Company's shares of common stock or public warrants, "ATNF" and "ATNFW",
respectively, in connection with the Reverse Stock Split.

 The Certificate of Amendment
did not reduce the number of authorized shares of our common stock, nor alter the par value of our common stock or modify any voting rights
or other terms of our common stock.

 No fractional shares were
issued in connection with the Reverse Stock Split and stockholders of record who otherwise would be entitled to receive fractional shares,
were instead entitled to have their fractional shares rounded up to the nearest whole share.

 February 2024 Reverse Stock Split

 On February 16, 2024, at
a Special Meeting of the Stockholders of the Company, our stockholders approved an amendment to our Second
Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares of
our common stock, par value $0.0001 per share, by a ratio of between one-for-four to one-for-forty, inclusive, with the exact ratio to
be set at a whole number to be determined by our Board of Directors.

 On February 26, 2024, the
Company's Board of Directors approved a one-for-19 reverse stock split of the Company's outstanding common stock
and the filing of a Certificate of Amendment to our Certificate of Incorporation to affect such reverse stock split, which was filed on
February 26, 2024. The Reverse Stock Split became effective on February 28, 2024 at 12:01 a.m. Eastern Time, with shares beginning trading
on a split-adjusted basis at market open on February 28, 2024. In connection with the Reverse Stock Split, every 19 shares of the Company's
common stock issued and outstanding as of the Effective Time were automatically converted into one share of the Company's common
stock.

 In connection with the reverse split, all outstanding options, warrants,
and other securities entitling their holders to purchase or otherwise receive shares of common stock were adjusted, as required by the
terms of each security. The number of shares available to be awarded under the Company's equity incentive plans were also appropriately
adjusted. Following the reverse split, the par value of the Common Stock remained unchanged at $0.0001 par value per share. The reverse
split did not change the authorized number of shares of common stock or preferred stock. No fractional shares were issued in connection
with the reverse split, and stockholders who would otherwise be entitled to receive a fractional share instead received one whole share
of common stock in lieu of such fractional share.

 The effects of the 1-for-19 Reverse
Stock Split have been retroactively reflected throughout this Report.

 Definition

 Unless the context requires
otherwise, references to the " Company, " " we, " " us, " " our, "
" 180 Life ", " 180LS " and " 180 Life Sciences Corp. " refer specifically to 180 Life
Sciences Corp. and its consolidated subsidiaries. References to " KBL " refer to the Company prior to the November 6,
2020 Business Combination (discussed and defined below).

 In addition, unless the context
otherwise requires and for the purposes of this Report only:

 " CAD " refers to Canadian dollars;

 " Exchange Act " refers to the Securities Exchange Act of 1934, as amended;

 " " or " GBP " refers to British pounds sterling;

 " SEC " or the " Commission " refers to the United States Securities and Exchange Commission; and

 " Securities Act " refers to the Securities Act of 1933, as amended.

 Where You Can Find Other Information

 We file annual, quarterly,
and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the public over the Internet
at the SEC's website at www.sec.gov and are available for download, free of charge, soon after such reports are
filed with or furnished to the SEC, on the " Investors "—" SEC Filings "—" All SEC
Filings " page of our website at www.180lifesciences.com. Copies of documents filed by us with the SEC are also available
from us without charge, upon oral or written request to our Secretary, who can be contacted at the address and telephone number set forth
on the cover page of this Report. Our website address is www.180lifesciences.com. The information on, or that may be accessed
through, our website is not incorporated by reference into this Report and should not be considered a part of this Report.

 Company Overview

 We are a clinical stage biotechnology
company headquartered in Palo Alto, California, focused on the development of therapeutics for unmet medical needs in chronic pain, inflammation
and fibrosis by employing innovative research, and, where appropriate, combination therapy. We were founded by several world-leading scientists
in the biotechnology and pharmaceutical sectors. Our world-renowned scientists Prof. Sir Marc Feldmann, Prof. Lawrence Steinman, Prof.
Raphael Mechoulam, since deceased, Dr. Jonathan Rothbard, and Prof. Jagdeep Nanchahal have significant experience and significant previous
success in drug discovery. The scientists are from the University of Oxford (" Oxford "), Stanford University and Hebrew
University of Jerusalem (the " Hebrew University "), and our management team has extensive experience in financing and
growing early-stage healthcare companies. Prof. Raphael Mechoulam passed away in March 2023, but his research at Hebrew University is
being carried on by other scientists as noted later in this document under the " SCAs Platform " section.

 We have three different product
development platforms that are focused on different diseases or medical conditions, and that target different factors, molecules or proteins,
as follows:

 Anti-TNF platform: focusing on fibrosis and anti-tumor necrosis factor (" anti-TNF ");

 SCAs platform: focusing on drugs which are synthetic cannabidiol (" CBD ") or cannabigerol (" CBG ") analogues (" SCAs "); and

 7nAChR platform: focusing on alpha 7 nicotinic acetylcholine receptor (" 7nAChR ").

 Our lead product candidate under the anti-TNF platform completed Phase
2a and Phase 2b proof-of-concept clinical trials in the United Kingdom ("U.K.") and the Netherlands for early-stage Dupuytren's
Contracture, a condition that affects the development of fibrous connective tissue in the palm of the hand.

 Currently, we are planning
or conducting clinical trials only for certain indications under the anti-TNF platform, such as a planned Phase 2 trial for post-operative
cognitive decline as well as a planned Phase 2 trial for frozen shoulder. We previously recruited patients for a feasibility trial for
frozen shoulder, for which we have ended such recruitment at nine patients, due to a regulatory request in the U.K. to end slow recruiting
trials. The result of the closure of the trial means that another trial will likely need to be undertaken in the future to recruit additional
participants.

 We were recently granted an
allowance of claims for a U.S. patent with respect to the use of adalimumab for early-stage Dupuytren's disease which, if granted,
would have a term that expires no earlier than in 2037. Of our three product development platforms, only one, the SCAs platform, involves
products that are related to cannabidiol (CBD) (and not to cannabis or tetrahydrocannabinol (THC)), and no clinical trials for indications
or products under the SCAs platform are currently being conducted in the United States or abroad. We are currently undertaking preclinical
research and development activities for the SCA platform. Due to restrictions in the Company's resources, the Company has not made
progress in the 7nAChR platform and has suspended further research and development activity in the meantime.

 The Company is currently evaluating
all options to monetize its existing assets, in addition to exploring other strategic alternatives to maximize value for its shareholders.
Potential strategic alternatives that may be explored or evaluated by the Company as part of this process include, but are not limited
to, an acquisition, merger, reverse merger, other business combination, sale of assets, licensing or other strategic transactions involving
the Company.

 Business Strategy

 Our goal is to capitalize
on our research in chronic pain, inflammation and fibrosis by pursuing the following strategies:

 advance our clinical-stage product candidate for early-stage Dupuytren's Contracture from its current late-stage development to seek and obtain approval in the U.K., European Union (" EU ") and the United States (" U.S. ") for such product candidate, potentially commercialize the product candidate in the U.K., EU and U.S. and identify the optimal commercial pathway in other markets around the world;

 move our pre-clinical product candidates into clinical trials, seek and obtain approval in the U.K., EU and U.S. for such future product candidates, and potentially commercialize such future product candidates in the U.S., U.K. and EU;

 leverage our proprietary product development platforms to discover, develop and commercialize novel first-in-class products for the treatment of chronic pain, inflammation and fibrosis; and

 strengthen our position in research in chronic pain, inflammation and fibrosis.

 Overview of Product Development Platforms

 The following chart summarizes
the products and indications, including those currently in clinical trial, for our three product development platforms.

 *
 Regulatory approvals obtained from the MHRA and CCMO and the
relevant accredited ethics committees to perform clinical trials in the U.K. and The Netherlands. No marketing applications or requests
for marketing approval have been submitted to the U.S. Food and Drug Administration (" FDA ") for any products
at this time.

 On December 1, 2021, we announced
positive top line data for the Phase 2b clinical trial of Dupuytren's Contracture.

 On February 22, 2023, we announced
the closure of recruitment of patients for the feasibility trial for frozen shoulder, for which we have ended such recruitment at nine
patients, due to a regulatory request in the U.K. to end slow recruiting trials. The result of the closure of the trial means that another
trial will likely need to be undertaken in the future to recruit additional participants.

 The product development platforms
are each described in more detail below.

 Fibrosis & Anti-TNF
Platform

 Our anti-tumor necrosis factor
(TNF) platform began at our wholly-owned subsidiary, 180 Therapeutics L.P. (" 180 LP "). This platform is focused
on studying the molecular mechanism of inflammatory diseases and fibrosis and on the discovery of TNF as a mediator of fibrosis, as well
as other immune-driven diseases. This research was first undertaken in the 1980s by our Executive Co-Chairman, Prof. Sir Marc Feldmann,
based on analysis of tissue from patients with rheumatoid arthritis (" RA "). We are applying this same approach to the
analysis of human disease tissue from patients with active fibrosis, research led by Prof. Jagdeep Nanchahal in Oxford (who is also the
Chairman of our Clinical Advisory Board), which has led to the identification of new therapeutic targets and approaches that we are developing.
Profs. Nanchahal and Feldmann, in collaboration with other scientists, are leveraging their experience and expertise in developing anti-inflammatories
to search for new applications for anti-TNF therapeutics. We are seeking to demonstrate that anti-TNF drugs, such as adalimumab, have
a positive effect on new indications such as Dupuytren's Contracture, frozen shoulder and post-operative cognitive dysfunction/delirium
(" POCD ").

 Our first product candidate
in clinical development is for the potential treatment of early-stage fibrosis of the hand, Dupuytren's Contracture, for which there
is currently no approved treatment in the U.K. or EU. Collagenase from Clostridium histolyticum has been approved in the USA for late-stage
Dupuytren's Contracture. The proposed treatment will be administered by a local injection of adalimumab, an anti-TNF antibody, into
early-stage disease tissue. The results for the Phase 2a clinical trial for Dupuytren's Contracture, supported by the Wellcome Trust,
U.K. Department of Health and us, were published in July 2018. The study demonstrated positive tissue response indicative of anti-fibrotic
mechanisms, as well as guiding dosing for follow up trials. Having defined the most efficacious dose and preparation and based on these
positive proof of concept data, we, together with the Wellcome Trust and the U.K. Department of Health, initiated a Phase 2b trial in
patients with early-stage Dupuytren's Contracture. The initial plan was to randomize 138 patients in a ratio of 1:1 to receive four
injections of adalimumab or placebo at three-month intervals and followed for a total of 18 months from baseline. With additional funding
from the Wellcome Trust, the Phase 2b trial completed recruitment of 174 patients in April 2019, having commenced dosing in February 2017.
The final patient was enrolled in April 2019. The Phase 2b clinical trial for early-stage Dupuytren's Contracture has been completed.
On December 1, 2021, we announced top line data from the trial, which indicates that the primary end point of nodule hardness and the
secondary end point of nodule size on ultrasound scan were met with statistically significant differences. There were no related severe
adverse events. As previously reported, the full results of the trial have been published in a peer-reviewed journal. Through this fibrosis
and anti-TNF product development platform, we are also performing research for the development of potential treatments of frozen shoulder,
liver and lung fibrosis and POCD.

 We have obtained regulatory
approvals from the U.K. MHRA and the Dutch Centrale Commissie Mensgebonden Onderzoek (CCMO), as well as from the relevant accredited
ethics committees, in order to perform clinical trials in the U.K. and The Netherlands solely for indications under the anti-TNF platform.
No marketing applications or requests for marketing approval have been submitted to, the U.S. Food and Drug Administration (" FDA ") for
any indications or products under the anti-TNF platform at this time. On March 29, 2022, we submitted a request to the FDA for a Type
C Meeting to discuss clinical outcome assessment in clinical trials of the anti-TNF platform for early stage Dupuytren's disease.
On April 26, 2022, the FDA granted the meeting request and agreed to provide written responses in lieu of a meeting. On June 9, 2022,
the FDA provided the aforementioned written responses in which the agency questioned whether nodule hardness and size would constitute
an appropriate end point in such studies. Specifically, the FDA stated, "The proposed outcome measures of nodule hardness and nodule
size do not appear to be clinical outcome measures that measure how a patient feels, functions, or survives, which would be needed to
support a demonstration of efficacy in your future registrational studies."

 Following the Phase 2b trial,
discussed previously, which demonstrated the efficacy of anti-TNF injections in reducing or eliminating the size and hardness of the palmar
nodules, which we believe may help in the prevention of the finger disability and the eventual need for surgery, our intention remains
to seek Conditional Marketing Authorization (" CMA ") for the therapy in the U.K. This authorization requires approval
from the U.K. MHRA. Subsequently, we plan to begin the necessary procedures to seek approval in the U.S., EU, and other potential countries.

 To support our CMA application,
we have had two scientific advice meetings with the MHRA. During these meetings, the MHRA requested additional information regarding the
reduction in nodule size and hardness and its impact on the eventual need for surgery of the deformed fingers. While we presented data
on a limited number of patients, demonstrating that those treated with anti-TNF injections did not require early surgery compared to the
placebo group, the sample size was too small to draw definitive conclusions. Nonetheless, based on the strength of the available data,
we believe, and our regulatory consultants in the U.K. and U.S. believe, it is appropriate to pursue a CMA for the U.K. market in conjunction
with the initiation of a limited size Phase 3 outcomes trial. This trial has to be initiated prior to the submission of the CMA approval
request documents. Our clinical consultants have designed a trial that we believe can be completed within three years, that is expected
to meet the requirements set forth by the regulatory authorities and allow for consideration of CMA. We have submitted a request for a
follow-up scientific advice meeting with the MHRA to discuss this trial strategy. Due to the agency's high workload and limited
staff, we have not yet received a confirmed date for this meeting.

 Considering our plans for
seeking marketing approval in the United States and other countries, we are also seeking a meeting with the U.S. FDA. This meeting, known
as a Type C meeting, aims to explore the potential for a pathway towards a pre-IND (Investigational New Drug) application and an
International IND application meeting. We believe that conducting the follow-on Phase 3 trial, discussed above, will likewise be necessary
for FDA acceptance. We have submitted a request to the FDA for this meeting but have not yet received a confirmed date.

 As we pursue this regulatory
strategy, we will need to raise additional financing.

 On February 22, 2023, we announced
the closure of recruitment of patients for the feasibility trial for frozen shoulder, for which we have ended such recruitment at nine
patients, due to a regulatory request in the U.K. to end slow recruiting trials. The result of the closure of the trial means that another
trial will likely need to be undertaken in the future to recruit additional participants.

 HMGB1 Program

 Our HMGB1 program
was formed with the in-licensing of the technology from the University of Oxford on November 2, 2021. Our HMGB1 program fell under the
Fibrosis and Anti-TNF Platform. We identified HMGB1 as a therapeutic target that acts on multiple endogenous adult stem cells to accelerate
the physiological regenerative response to current or future injuries. These findings have broad relevance to the fields of stem cell
biology and regenerative medicine and suggest a therapeutic approach to promote tissue repair such as in NASH liver regeneration.

 Due to the ongoing costs of this research program and the need for the
Company to focus its resources on the Company's primary platform to treat fibrosis using anti-TNF (tumor necrosis factor), the Board
of Directors of the Company elected to terminate the Company's HMGB1 license agreement with Oxford on September 22, 2023, and on
September 22, 2023, the Company and Oxford entered into a termination letter, formally terminating the License effective September 22,
2023. The termination letter also clarified amounts that we owed after termination of the License, including approximately $20,000 in
unbilled fees, which were paid in December 2023. No material early termination penalties were incurred by the Company in connection with
the termination of the license.

 On October 25, 2022, the Company
entered into a research sponsorship agreement related to the HMGB1 program, pursuant to which the Company agreed to sponsor ongoing research
at Oxford related to the HMGB1 program. Pursuant to this agreement, the Company entered into an obligation to pay, in aggregate, 500,000
in 2023. The Company has not made any payments towards this program to date and is in negotiations with Oxford to reduce this amount owed.

 SCAs Platform

 Our SCAs platform began at
our wholly-owned subsidiary, CannBioRex Pharmaceuticals Corp. (" CBR Pharma ") with the collaborative work of its
founders Prof. Mechoulam, deceased, and Prof. Feldmann. This platform focuses on the development of synthetic pharmaceutical grade molecules
close or distant analogs of non-psychoactive cannabinoids such as CBD for the treatment of inflammatory diseases and pain. These development
efforts are a result of a 20-year collaboration between Prof. Feldmann, who discovered and commercialized anti-TNF therapy for treatment
of RA and subsequently a number of inflammatory diseases, which is currently the best-selling drug class in the world, and Prof. Mechoulam,
who was a world leading expert in cannabis chemistry who successfully identified THC, CBD and, subsequently, the endocannabinoids. We
are working with a research team based at the Kennedy Institute at Oxford, consisting of Prof. Feldmann, Prof. Richard Williams and others,
and a research team based at Hebrew University, consisting of Prof. Avi Domb, Prof. Amnon Hoffman and others, to generate new drugs, test
them, and optimize their uptake and delivery to disease targets. The aim is to develop novel, orally active analgesic and anti-inflammatory
medications based on synthetic compounds to target chronic diseases. We term these synthetic compounds generically as " synthetic
CBD analogs " (" SCAs "). Our primary development targets are arthritis and chronic and recurrent pain, while
our secondary development targets are diabetes/diabetic neuropathy, fibromyalgia, multiple sclerosis, obesity and fatty liver disease.
Unfortunately, Dr. Mechoulam passed away in March 2023, and while he will be sorely missed, work with his colleagues will continue as
necessary.

 No regulatory approvals have
been sought or obtained from appropriate authorities at this time for any products or indications under the SCAs platform.

 7nAChR Platform

 Our 7nAChR platform
began at our wholly-owned subsidiary, Katexco, where its founders identified 7nAChR as a key receptor for the
amyloid proteins associated with diseases like Alzheimer's and Parkinson's Disease. 7nAChR is expressed
on the surface of both neuronal cells in the brain and on important cells of the immune system. The research conducted by Dr. Jonathan
Rothbard and Prof. Steinman has shown that small molecules available as drugs taken by mouth can engage this receptor and potentially
reduce inflammatory diseases. Dr. Rothbard and Prof. Steinman have also shown that 7nAChR is critical in reducing
disease animal models of multiple sclerosis and RA, as well as heart attack and stroke. Our 7nAChR product development
platform is currently focused on developing 7nAChR agonists for the treatment of inflammatory diseases, initially
ulcerative colitis induced after cessation of smoking.

 No regulatory approvals have
been sought or obtained from appropriate authorities at this time for any products or indications under the 7nAChR
platform. Until we are able to obtain sufficient capital to pursue this program, we do not expect to make significant progress with our 7nAChR platform.

 Product Candidates

 We are attempting to build
a broad and diverse pipeline of product candidates in chronic pain, inflammation and fibrosis. Our product candidates are and will be
selected for development based on: potential to address unmet medical needs; development feasibility as determined by our preclinical
research and development efforts; potential to rapidly achieve proof-of-concept based on easy-to-measure validated regulatory endpoints;
and significant commercial potential.

 Anti-TNF Platform Dupuytren's
Contracture

 Overview

 Dupuytren's Contracture,
also referred to as hand fibrosis, is a progressive, incurable disease characterized by the development of fibrous cords in the palm of
the hand, commonly affecting the ring and/or small finger and often multiple joints, leading to contracture and the inability to straighten
the affected fingers. Symptoms, when presented to a physician, range from the appearance of nodules in the palm, which can be painless
or painful and often disconcerting to the patient, to the loss of the use of the contracted finger. There are currently no approved treatment
options for those patients who present with symptomatic, early-stage disease.

 Surgery remains the standard
treatment for patients with Dupuytren's Contractures but is associated with extended recovery periods and risks of recurrence.

 We are developing therapies
by repurposing of the anti-TNF therapeutic adalimumab, previously approved and used under the brand name Humira for several autoimmune
conditions, for the treatment of early-stage Dupuytren's Contracture. Research at Oxford University has indicated an anti-TNF mechanism
can slow or prevent the proliferation of myoblast cells that lead to the formation and growth of the fibrous nodules/cords in the palm
and possible finger contracture. We have advanced the development program through Phase 2b clinical trials to evaluate the impact of multiple,
intralesional injections on disease progression and functional improvement.

 Dupuytren's patients
who have advanced disease are primarily treated by orthopedic or plastic surgeons, who rely on invasive interventions when the contracture
impacts hand function. Current treatment options include open surgeries (fasciotomies or fasciectomies) and the less invasive procedures
of needle aponeurotomy (NA) or collagenase injections. The less invasive procedures are designed to disrupt the integrity of a contracted
cord so the fingers can be straightened. Unfortunately, these options are associated with a high rate of recurrence. Dissatisfaction within
the medical and Dupuytren patient community with outcomes for later-stage disease and the lack of options to intervene at an early/pre-contracture
stage indicate there is an unmet medical need for early-stage intervention.

 According to the Dupuytren's
Foundation, Dupuytren's Contracture prevalence is estimated to be up to 7% of the U.S. population. Based on the Foundation's
estimates, approximately three million patients have contractures that should be treated but only 10% to 20% of those patients are treated.
Reasons for the lack of treatment may include the type of available interventions, poor long-term outcomes, and reimbursement hurdles.

 In primary interviews in late
2021 with 8 orthopedic/plastic surgeons, conducted by Red Sky Partners (an independent third-party consulting firm) on our behalf
and designed to better understand the unmet need for patients with Dupuytren's Contracture, revealed a strong desire among hand
surgeons and patients to treat this condition early, before the development of late stage contractures, in a non-invasive manner that
will limit further progression, preserve function and prevent or delay invasive surgery. Surgeons' reactions to the rationale for
the use of adalimumab to address this unmet need were overall positive and the mechanistic concept of an anti-TNF compound was considered
compelling. In the view of the majority of surveyed hand surgeons, the non-invasive, safe product profile would potentially position adalimumab
as an important therapeutic option for a much wider range of patients than are typically treated today. Assuming clinical efficacy and
safety are supported with published data, we believe that adalimumab would become an attractive alternative to surgery, needle aponeurotomy
or collagenase. Further, we believe it has potential use in many early-stage patients who are not treated today.

 Based on both primary (feedback
from these physician interviews) and secondary research, Red Sky Partners concluded that an initial label focused on patients with
a clear contracture where adalimumab would soften nodules and limit progression would be highly differentiated from current therapies
and could generate revenues in the range of $300 million to $350 million annually in the U.S. More significantly, the opportunity to offer
a safe, non-invasive therapeutic leading to improved function could dramatically expand the treatable population as more patients seek
treatment and more physicians are motivated to offer their patients an alternative to waiting to see if their disease progresses, which
they cannot do today.

 Phase 2 Clinical Trials

 Our wholly-owned subsidiary,
180 LP, contributed to the funding of a Phase 2a clinical trial for Dupuytren's Contracture along with the Wellcome Trust and the
U.K. Department of Health, which using an experimental medicine clinical trial design demonstrated positive tissue response, as well as
guiding dosing and tolerability for follow-up trials. The data was published in June 2018.

 For the Phase 2a trial, we
recruited 28 patients, eight assigned to the 15 milligrams (mg), 12 to the 35 mg and eight to the 40 mg adalimumab cohorts.
There was no change in mRNA levels for ACTA2, COL1A1, COL3A1 and CDH11. Levels of -SMA protein expression
in patients treated with 40 mg adalimumab (1.09 0.09 ng per g of total protein) were significantly
lower (p = 0.006) compared to placebo treated patients (1.51 0.09 ng/ g). The levels of
procollagen type I protein expression were also significantly lower (p = 0.019) in the subgroup treated with 40 mg
adalimumab (474 84 pg/ g total protein) compared with placebo (817 78 pg/ g).
There were two serious adverse events, both considered unrelated to the study drug. In this dose-ranging study, injection of 40 mg
of adalimumab in 0.4 ml resulted in down regulation of the myofibroblast phenotype as evidenced by reduction in expression of -SMA
and type I procollagen proteins at 2 weeks.

 Having defined the most efficacious
dose and preparation and based on these positive proof-of-concept data, we, together with the Wellcome Trust and the U.K. Department of
Health, initiated a Phase 2b trial in patients with early-stage Dupuytren's Contracture. The initial plan was to randomize 138 patients
in a ratio of 1:1 to receive four injections of adalimumab or placebo at three-month intervals and followed for a total of 18 months from
baseline. The Phase 2b trial, which was funded by grants from the Wellcome Trust and the U.K. Department of Health, with a contribution
from 180 LP to purchase the drug, completed recruitment of 174 patients in April 2019 and commenced dosing in February 2017 in the
U.K. and Groningen, The Netherlands.

 The Phase 2b clinical trial
for early-stage Dupuytren's Contracture has been completed. On December 1, 2021, we announced top line data from the trial, which
indicates that the primary end point of nodule hardness and the secondary end point of nodule size on ultrasound scan were met with statistically
significant differences. There were no related severe adverse events. The full results have been published in the Lancet Rheumatology
publication on April 29, 2022. Based on the results of the Phase 2b clinical trial, the study's researchers analyzed data on costs
and quality of life, which is required for U.K. NICE marketing approval. They extrapolated the trial results using a patient-level simulation
model, which estimated the lifetime cost-effectiveness of adalimumab for treatment of Dupuytren's Disease. The simulated model also
evaluated whether hypothetical repeated courses of adalimumab each time the nodule reactivated (every three years) in patients are
likely to be cost-effective for treating progressive early-stage Dupuytren's Disease. The model-based extrapolation showed that,
over a lifetime, repeated courses of adalimumab are likely to cost 14,593 per quality-adjusted life year gained, which would be
considered highly cost-effective compared with the current standard National Health Service (NHS) practice.

 Other Product Candidates
or Indications

 In addition to the potential
treatment, we are developing for Dupuytren's Contracture described above, we are seeking to repurpose anti-TNF for use as a treatment
for other fibrotic conditions such as frozen shoulder. Prof. Feldmann's previous work in the 1980's demonstrated that anti-TNF
is an effective anti-inflammatory with many possible uses, and it was subsequently approved for various forms of inflammatory arthritis
and inflammatory bowel disease (IBD), as well as other indications. This has since created what is currently the best-selling drug class
in the world, anti-TNF therapeutics, which, according to a Research Reports World report published on November 3, 2022, was valued at
$42.7 billion in 2022. By using a well-known and extensively used therapeutic, adalimumab, the research and development process may be
truncated because of existing product information relating to safety, as the drug has been widely used over the past 20 years in millions
of patients.

 Frozen Shoulder

 Frozen shoulder, also referred
to as adhesive capsulitis, is an extremely painful and debilitating condition that affects an individual's everyday activities,
including sleep. According to the National Institute of Health, frozen shoulder is most common in people between the ages of 40 and 60.
It is estimated that 2% to 5% of the population are affected by frozen shoulder at some point, and it is somewhat more common in women
than in men. People with diabetes are particularly likely to develop a frozen shoulder: About 10 to 20% of them get it, but it is not
yet known why this happens. In addition, approximately 20% of people suffering from a frozen shoulder will develop the same problem in
their other shoulder. According to an article published in Shoulder & Elbow in 2010, it is estimated that up to 30% of patients with
diabetes develop frozen shoulder, and the symptoms tend to be more persistent and recalcitrant in this group. A large percentage of frozen
shoulder patients also have Dupuytren's. Our working hypothesis is that frozen shoulder involves a similar TNF-driven fibrotic process
as Dupuytren's and, as a result, might benefit from anti-TNF injections, as seen in our Phase 2b trial in patients with early-stage
Dupuytren's Contracture.

 During the pain predominant
inflammatory phase, patients are typically treated with analgesics, physiotherapy and corticosteroid injections. Patients with persistent
stiffness may be referred to secondary care for capsular release by manipulation under anesthesia, hydrodilatation or surgical arthroscopy.
To our knowledge, there is currently no approved targeted therapy, and in conjunction with the National Institute for Health Research
(U.K.), we are investigating the feasibility of recruiting patients during the early pain-predominant inflammatory phase of the disease
and delivery of a local injection of anti-TNF. The set-up stage for this Phase 2 clinical trial for the local injection of anti-TNF for
frozen shoulder started in June 2021. A 250,000 grant has been awarded from NIHR to the University of Oxford to support execution
and clinical trial sites are being identified. We are providing additional funding to support this trial. The recruitment of men and women
across England with early-stage Frozen shoulder for a trial to determine the feasibility of conducting a large randomized controlled trial
to assess whether an intra-articular injection of anti-TNF (Adalimumab) can reduce pain and improve function in people with pain
predominant early-stage frozen shoulder, which was called the Anti-Freaze-F trial, began in May 2022. The Anti-Freaze-F trial was being
run by the University of Oxford and originally sought to recruit 84 participants. Following delays in gaining approvals due to backlogs
in the NIHR system due to COVID-19 and consequential staff vacancies, nine participants were recruited for participation in the trial
through mid-February 2023. Subsequently, the NIHR's Research Recovery and Reset program identified the trial as slow moving, due
to the considerable challenges we faced to open recruitment sites and enroll sufficient participants during COVID-19. Therefore, the NIHR
asked the chief investigators to close the trial for further recruitment. Our request for a no cost trial extension was denied. The participants
enrolled to date have received their injections and follow up according to the established protocol. The result of the closure of the
trial means that another trial will likely need to be undertaken at a future time to recruit additional participants.

 Human Liver Fibrosis

 Fibrosis of the liver is characterized
by long-term damage to the organ caused by the replacement of normal liver tissue with scar tissue. The condition is most commonly caused
by non-alcoholic fatty liver disease (" NAFLD "), which encompasses non-alcoholic fatty liver (" NFL ") and
non-alcoholic steatohepatitis (" NASH "). NAFLD affects approximately 30% of the U.S. population, according to an article
published in Nature Reviews Gastroenterology & Hepatology in 2016. Approximately 2% of patients with NFL and approximately 15% to
20% of patients with NASH progress to cirrhosis, fibrosis of the liver with major health issues.

 To our knowledge, there is
no current approved treatment for individuals with NASH. We therefore believe that there is a large potential market for the creation
of an effective preventative treatment. According to Allied Market Research, the market for treating liver fibrosis was approximately
$13 billion in 2018 and is projected to rise to approximately $20 billion in 2022, rising at a compounded annual growth rate (CAGR) of
over 11% per year. We initiated preclinical studies for NASH based on human liver samples during the second quarter of 2020. We have performed
preclinical work, but do not plan to move forward in a significant manner without raising additional capital.

 Post-operative Cognitive
Decline (POCD)

 POCD is a common neuropsychiatric
syndrome, defined as disturbance of attention, awareness and cognition, which develops over a short period of time and tends to fluctuate
during the course of the day. Patients with hip fracture are at particularly high risk of developing POCD. The U.K.'s national audit
data for 2018 showed that 25% of all patients with hip fracture suffered from delirium. POCD is associated with poor functional outcomes,
reduced quality of life and longer hospital stays. People with hip fracture who developed delirium are twice as likely to die as inpatients,
and nearly four times more likely to need placement in a nursing home. POCD has also been closely associated with long-term cognitive
impairment.

 Hip fractures are one of the
main challenges facing elderly patients and healthcare systems. According to an article published in The Lancet Public Health in 2017,
hip fractures are associated with an average loss of 2.7% of the healthy life expectancy in the middle-aged and older population in the
U.S. and Europe. People suffering hip fracture have a mean age of 83 years, are frail, and two-thirds are women. They suffer a 30-day
mortality of 7% and experience a persistent reduction in their health-related quality-of-life similar to that of a diagnosis of Parkinson's
disease or multiple sclerosis. According to various studies, POCD is developed in 13-40% of patients following cardiac surgery. With 500,000
open heart surgeries and 450,000 hip surgeries in the U.S. each year, in advanced age patients, a beneficial therapy to treat POCD would
be a significant benefit to these patients. We plan to initiate a Phase 2 study using anti-TNF for POCD and start patient recruitment
during 2024. An issued patent to protect this potential use has been licensed from The Kennedy Trust for Rheumatology Research. Our researchers
discovered that tissue damaging surgery releases TNF into the circulation which, in turn, opens the brain cognitive areas for an influx
of inflammatory mediators, resulting in delirium, which might be prevented by administering anti-TNF at the time of surgery. Experiments
in animal models have supported this hypothesis.

 SCAs Platform

 Overview

 Cannabinoids are a class of
compounds derived from cannabis plants. The two major cannabinoids contained in cannabis are CBD and THC. Although one cannabinoid, THC,
is known to cause psychoactive effects associated with the use of herbal cannabis, no other cannabinoid is known to share these properties.
In recent decades, there have been major scientific advances that have led to the discovery of new plant-derived cannabinoids and the
endocannabinoid system. There are at least two types of cannabinoid receptors in the human endocannabinoid system, cannabinoid receptor
1 (" CB1 ") and cannabinoid receptor 2 (" CB2 "). CB1 receptors are considered to be among the
most widely expressed G protein-coupled receptors in the brain and are particularly abundant in areas of the brain concerned with movement
and postural control, pain and sensory perception, memory, cognition, emotion, and autonomic and endocrine function. CB1 receptors are
also found in peripheral tissues including peripheral nerves and non-neuronal tissues such as muscle, liver tissues and fat. CB2 receptors
are expressed primarily in tissues in the immune system and are believed to mediate the immunological effects of cannabinoids. CBD does
not interact with CB1 receptors and is only a weak agonist of CB2 receptors. CBD interacts with other important neurotransmitter and neuromodulatory
systems in the human body, including transient receptor potential channels, adenosine uptake and serotonin receptors. The far-reaching
and diverse pharmacology of the numerous cannabinoids provides significant potential for development of cannabinoid therapeutics across
many indications and disease areas, but also adds to the complexity of the research.

 For the SCA program, we have
agreements in place with Hebrew University and Oxford, pursuant to which we intend to conduct research to develop and characterize novel
SCAs for the treatment of certain target indications, and to perform early-phase clinical trials. Through the Research Agreements with
Hebrew University and Oxford, we established research facilities at the Hebrew University and Oxford, in which the development and testing
of new cannabinoids designed and synthesized at the Hebrew University will be facilitated. The labs at the Hebrew University will synthesize
the chemical compounds and perform preliminary efficacy and safety studies.

 Once these initial studies
are completed at the Hebrew University, the chemical compounds are sent to Prof. Richard Williams at Oxford, where further evaluation
is carried out to identify candidates which have the best potential for clinical efficacy and commercial development. Subsequently, we
will support the clinical development of the lead compound(s), culminating in Phase 2 clinical trials to establish clinical utility in
chronic pain and inflammatory indications.

 The focus of the research
is the development of safe and well-tolerated compounds with analgesic and immunomodulatory activity and with the capacity to synergize
with current therapies, which target downstream inflammatory processes. After conducting initial research and development, we selected
the most promising of the chemical derivatives to move into Phase 1/2 clinical trials, pending successful toxicity studies. In addition,
we have identified two lead solid dosage oral formulations of CBD from animal studies, and preparations are underway to facilitate pharmacokinetic
analysis in healthy human volunteers.

 Product Candidates or Indications

 We believe that there are
unmet needs for orally available, relatively safe anti-inflammatory drugs, especially those with analgesic properties. We believe that
SCAs have the potential to fulfill these needs and we have started to develop novel, orally available and patentable drug candidates to
treat certain diseases or conditions such as arthritis, multiple sclerosis, diabetes, psoriasis, obesity and fatty liver, and various
painful conditions. Our work on SCAs is currently in the preclinical development stage.

 Because medical cannabis is
a complex mixture of over 200 compounds from plants, providing a consistent level of the active compound of interest or controlling the
level of the other natural compounds is difficult. Accordingly, we are working on orally available SCAs, not derived from plants, to address
the deleterious issues of medical cannabis described above. If successful, these SCAs could become approved drug products that offer a
robustly consistent and safe dosage that allows patient intake to be carefully controlled.

 We believe that the development
and clinical study of SCAs will reveal that SCAs have several key advantages over medical cannabis, including:

 use of a pure compound (>99.5%) rather than a mixture of compounds;

 ability to test and control dosing, which in turn controls efficacy and side effect levels;

 creation of a reproducible product; and

 ability to engineer novel synthetic analogs to control binding preferences to select receptors, control agonist or antagonist effects of receptor binding (pharmacokinetics and dynamics), modify half-life of the drug in the body, and create pro-drug forms that are only activated in specified tissues, thereby potentially reducing off target side effects.

 In addition to the above advantages,
testing SCAs in scientific, double-blind clinical trials would help to allay physicians' concerns regarding the therapeutic use
of marijuana-based compounds. This change could increase the number of patients that have access to these drug therapies. If clinical
trials are successful, there are a number of potential markets and indications for SCAs which we could target, which include individuals
suffering from chronic and recurrent pain, diabetes, osteoarthritis, obesity and fatty liver disease.

 7nAChR Platform

 Overview

 Two of our lead scientists,
Prof. Steinman and Dr. Rothbard, previously identified a key receptor for the amyloid proteins associated with diseases like Alzheimer's
and Parkinson's disease, called 7nAChR. The 7nAChR is expressed on the surface of both neuronal cells in the brain
and on cells of the immune system. The research conducted by Dr. Rothbard and Prof. Steinman has shown that small molecules available
as drugs taken by mouth can engage this receptor and potently reduce inflammatory diseases. Dr. Rothbard and Prof. Steinman have shown
that this receptor is critical in reducing disease in animal models of multiple sclerosis and RA, as well as heart attack and stroke.

 Our efforts to understand
the role of the high concentration of small heat shock proteins (" sHsp ") found in the lesions in the brains of
patients with multiple sclerosis led us to realize that the protein was (i) immune suppressive and (ii) therapeutic in animal
2 models of multiple sclerosis, cardiac and retinal ischemia, and stroke. A significant realization was that amyloid fibrils composed
of proteins or small peptides exhibited biological responses equivalent to the sHsps. The fibrils and the sHsps specifically bound and
activated macrophages (" M ") and regulatory B cells. Crosslinking and precipitation experiments demonstrated
that both species bound nAChR and signaled through Jak2/Stat3. We realized that nicotine treatment of experimental autoimmune encephalomyelitis
(" EAE ") induces an identical pattern of immune suppression as our treatments and exhibits pre-clinical efficacy
that is comparable with many of the drugs that are approved for multiple sclerosis (MS) when they were tested in EAE models. Collectively,
these observations have informed our strategy to develop an orally available, small molecule agonist of 7nAChR for inflammation
and autoimmune diseases.

 The 7 subunit of 7nAChR
is an integral part of an endogenous immune suppressive pathway, in which activation of the vagus nerve stimulates acetylcholine secretion,
which in turn binds 7nAChR on M s and regulatory B lymphocytes. Activation of the M s initiates an immunosuppressive cascade
of events that lead to reduction of pro-inflammatory cytokines, suppression of B and T cell activation and control of inflammation.

 In autoimmune diseases like
RA, where there is intense inflammation destroying joints, and in multiple sclerosis, where the brain is under attack with damage to vital
neurologic circuits, the body's immune system turns against its own tissues. Other diseases ranging from atherosclerosis to gout,
also reveal manifestations of an unwanted autoimmune attack.

 Activation of the 7nAChR
results in a signaling cascade involving Jak2 and Stat3 leading to the conversion of the macrophages to an immune suppressive phenotype
and the production of IL-10. IL-10 is known to reduce inflammatory cytokines, most prominently TNF, IL-1, and IL-6. Consequently, 7nAChR
agonists should complement anti-TNF therapy, which opens up the possibility of developing a new class of orally available medicines which
are anti-inflammatory but much safer than existing medications such as NSAIDS, Cox2 inhibitors, methotrexate, and Janus kinase (JAK) inhibitors.
This is because 7nAChR agonists are activating an endogenous regulatory pathway, rather than blocking important pathways needed
for diverse processes. The market opportunity arises from the complex and expensive effort by several large and small biotechnology companies
in the development of a spectrum of orally available partial agonists specific for 7nAChR. The compounds underwent extensive preclinical
assessment and were used in 18 studies comprising 2,670 subjects.

 The drugs universally were
shown to be safe, but ineffective in trials for neurologic and psychiatric diseases, namely Alzheimer's disease and schizophrenia.
In randomized, placebo-controlled clinical trials for cognitive impairment in Alzheimer's disease and schizophrenia, the compounds
failed to meet their primary endpoint.

 We plan to use these previous
studies as a foundation to potentially develop a patentable 7nAChR analog within this family to use as an immune suppressive to
treat a range of inflammatory and autoimmune indications including RA, inflammatory bowel disease (IBD), relapsing and progressive forms
of multiple sclerosis, atherosclerosis, gout and osteoarthritis. Our scientists have found that the 7 receptor on macrophages and
regulatory B lymphocytes are different from the target of the drugs developed so far.

 Product Candidates or Indications

 We intend to identify, characterize,
synthesize, and patent an orally available small molecular weight agonist of 7nAChR by screening non-patented analogs of large
numbers of known agonists defined by pharmaceutical companies. We intend to outsource this work to Evotec GMBH, an integrated early discovery
organization, and one which we have worked with in the past, specializing in ion channels and transporters, offering clients specialized
technologies and scientific expertise to move from target to lead compounds.

 Following a safety and efficacy
assessment program, we intend to select candidates for pre-clinical development as a prelude to the potential initiation of clinical studies,
which could potentially be followed by an Investigational New Drug Application (" IND ") to the FDA. Our first intended
target indication for its 7nAChR development platform is smoking cessation induced ulcerative colitis.

 Until we are able obtain sufficient
capital to pursue this program, we do not expect to make significant progress with our 7nAChR platform.

 Outsourcing and Manufacturing

 We are currently outsourcing
our clinical trials, which are conducted at Oxford University, Edinburgh, U.K. and Groningen, The Netherlands, and only involve certain
indications under the anti-TNF platform. We expect to continue to outsource our clinical trials and conduct them at (1) in the case
of the anti-TNF platform, Oxford University and Groningen, The Netherlands, (2) in the case of the SCAs platform, Hebrew University
and Oxford University, and (3) in the case of the 7nAChR platform, to be determined.

 We also expect to outsource
all of our manufacturing activities, including those activities at the research or clinical stage, with SCAs to be produced at Hebrew
University and 7nAChR to be produced by Evotec GMBH and the anti-TNF platform utilizing off-the-shelf adalimumab.
In addition, we expect our products to be good manufacturing practice (GMP) grade and produced by accredited contract research organizations
(CROs).

 Material Agreements

 We have entered into material
research and licensing agreements (the " Research Agreements ") with various universities and parties in order to
conduct research to develop potential product candidates. We have also entered into other material consulting and advisory services agreements
with various scientists (the " Consulting Agreements ") to assist with such research.

 Overview of Research
Agreements

 The Research Agreements include
agreements with the Hebrew University and Oxford. For the anti-TNF platform, the Research Agreements with Oxford allow us to contribute
financially to sponsor the research being conducted for the anti-TNF platform. In return, we will receive an exclusive option to license
any intellectual property arising from the Research Agreements. There are also license agreements in place whereby we have exclusively
licensed certain intellectual property from Oxford.

 For the SCA program, we have
agreements in place with Hebrew University and Oxford, pursuant to which we intend to conduct research to develop and characterize novel
SCAs for the treatment of certain target indications, and to perform early-phase clinical trials. Through the Research Agreements with
Hebrew University and Oxford, we established research facilities at the Hebrew University and Oxford, in which the development and testing
of new cannabinoids designed and synthesized at the Hebrew University will be facilitated.

 The Research Agreements are
each described below.

 Research Agreements with
the Hebrew University

 On May 13, 2018, our wholly-owned
subsidiary CBR Pharma entered into a research and license agreement (the " 2018 Hebrew Agreement ") with Yissum Research
Development Company of the Hebrew University of Jerusalem, Ltd. (" Yissum "), pursuant to which Yissum granted CBR Pharma
a worldwide exclusive license (the " 2018 Hebrew License ") to develop and commercialize certain patents (the " 2018
Hebrew Licensed Patents "), know-how and research results (collectively, the " 2018 Hebrew Licensed Technology "),
in order to develop, manufacture, market, distribute or sell products, all within the use of the 2018 Hebrew Licensed Technology for the
treatment of any and all veterinary and human medical conditions, including obesity, pain, inflammation and arthritis (the " 2018
Field ").

 Pursuant to the 2018 Hebrew
Agreement, notwithstanding the grant of the 2018 Hebrew License, Yissum, on behalf of Hebrew University, will retain the right to (i) make,
use and practice the 2018 Hebrew Licensed Technology for Hebrew University's own research and educational purposes; (ii) license
or otherwise convey to other academic and not-for-profit research organizations the 2018 Hebrew Licensed Technology for use in non-commercial
research; and (iii) license or otherwise convey the 2018 Hebrew Licensed Technology to any third party for research or commercial
applications outside the 2018 Field.

 The 2018 Hebrew Agreement
further provides that CBR Pharma is entitled to grant one or more sublicenses to the 2018 Hebrew Licensed Technology for exploitation
in the 2018 Field.

 All right, title and interest
in and to the 2018 Hebrew Licensed Technology vest solely in Yissum, and CBR Pharma will hold and make use of the rights granted pursuant
to the 2018 Hebrew License solely in accordance with the terms of the 2018 Hebrew Agreement.

 As consideration for the 2018
Hebrew License, CBR Pharma paid Yissum a license fee of $75,000 and agreed to continue to pay an annual license maintenance fee (the " License
Maintenance Fee ") of $50,000, beginning on May 1, 2019 and thereafter on the first day of May each year. The License Maintenance
Fee is non-refundable but may be credited each year against royalties on account of net sales of products made from May 1 to April 30
of each year.

 Yissum has also agreed to
undertake research and to synthesize chemical compounds that will be used by CBR Pharma, through additional research at both Oxford and
Hebrew University, to develop orally active analgesic and anti-inflammatory medications. Compounds will be shipped from Hebrew University
to Oxford for use in pre-clinical studies to establish efficacy in pain and inflammation.

 Upon the achievement of certain
milestones in respect of the chemical compounds derived from the 2018 Hebrew Licensed Technology, CBR Pharma is obligated to make certain
payments to Yissum, including but not limited to the following:

Fee

 Submission of the first IND testing for the FDA

 $
 75,000

 Commencement of one Phase 1/2 trial with the FDA

 $
 100,000

 Commencement of one Phase 3 trial with the FDA

 $
 150,000

 For each product market authorization/clearance (maximum of $500,000)

 $
 100,000

 (maximum of $500,000
)

 For every $250 million in accumulated sales of the product until $1 billion in sales is achieved

 $
 250,000

 CBR Pharma will pay Yissum
royalties equal to (i) 3% of the net sales for the first annual $500 million of net sales, and (ii) 5% of the net sales after
the net sales are at or in excess of $500 million.

 In the event of a sale by
CBR Pharma stockholders of their common shares or the transfer or assignment of the 2018 Hebrew Agreement, CBR Pharma is obligated to
pay Yissum a fee of 5% of the consideration received by CBR Pharma pursuant to such corporate transaction. In the event of an initial
public offering, or a go-public event, CBR Pharma was obligated to issue registered common shares to Yissum equal to 5% of the issued
and outstanding common shares, on a fully-diluted basis, concurrently with the closing of such transaction. The Business Combination that
was consummated on November 6, 2020, was considered a go-public event, pursuant to which we issued 12,028 of our common shares to Yissum
prior to the closing of the Business Combination.

 CBR Pharma has also agreed
to reimburse Yissum (to a maximum of $30,000) for costs incurred for patent expenses.

 Yissum and CBR Pharma also
agreed to establish a research program for which CBR Pharma funded a $400,000 budget for the 12-month period ended May 2019. The Company
plans to move forward with the research using a different third party, of which no agreement has been finalized.

 The 2018 Hebrew Agreement
will terminate upon the occurrence of the later of the following: (i) the expiration of the last of the 2018 Hebrew Licensed Patents;
(ii) the expiration of the last exclusivity on any product granted by any regulatory or government body; (iii) the expiration
of a continuous period of twenty years during which there was no commercial sale of any product in any country; or (iv) if we elect
to obtain an exclusive license to the know-how under the terms of the 2018 Hebrew Agreement, the expiration of such exclusive license.

 On November 11, 2019, CBR
Pharma entered into an additional research and license agreement (the " 2019 Hebrew Agreement ") with Yissum, pursuant
to which Yissum granted CBR Pharma a worldwide sole and exclusive license (the " 2019 Hebrew License ") to develop
and commercialize certain patents (the " 2019 Hebrew Licensed Patents "), know-how and research results (collectively,
the " 2019 Hebrew Licensed Technology," and together with the 2018 Hebrew Licensed Technology, the " Hebrew
Licensed Technology "), in order to develop, manufacture, market, distribute, sell, repair and refurbish products, all within
the use of the 2019 Hebrew Licensed Technology for (i) Cannabinoid phenolate metal salts, including mono, di and trivalent metals
such as Li, Na, K, Ca, Mg, Zn, Fe and Al and their mixtures with native or synthetic cannabinoids, their pharmaceutical formulations,
including for oral and topical administration; and (ii) pharmaceutical formulations, for the administration of cannabinoid chemical
derivatives, including any and all veterinary and human medical conditions, including obesity, pain, inflammation and arthritis (the " 2019
Field ").

 Pursuant to the 2019 Hebrew
Agreement, notwithstanding the grant of the 2019 Hebrew License, Yissum, on behalf of Hebrew University, will retain the right to (i) make,
use and practice the 2019 Hebrew Licensed Technology for Hebrew University's own research and educational purposes, but not for
commercial purposes, and subject to the maintenance of confidentiality for any know-how or unpublished patent information contained in
the 2019 Hebrew Licensed Technology; (ii) license or otherwise convey to other academic and not-for-profit research organizations
the 2019 Hebrew Licensed Technology for use in non-commercial research and subject to the maintenance of confidentiality for any know-how
or unpublished patent information contained in the 2019 Hebrew Licensed Technology; and (iii) license or otherwise convey the 2019
Hebrew Licensed Technology to any third party for research or commercial applications outside the 2019 Field, subject to the maintenance
of confidentiality for any know-how or unpublished patent information contained in the 2019 Hebrew Licensed Technology.

 The 2019 Hebrew Agreement
further provides that CBR Pharma is entitled to grant one or more sublicenses to the 2019 Hebrew Licensed Technology for exploitation
in the 2019 Field.

 All right, title and interest
in and to the 2019 Hebrew Licensed Technology vests solely in Yissum, and CBR Pharma will hold and make use of the rights granted pursuant
to the 2019 Hebrew License solely in accordance with the terms of the 2019 Hebrew Agreement.

 The 2019 Hebrew Licensed Technology
will terminate upon the occurrence of the later of the following: (i) the expiration of the last of the 2019 Hebrew Licensed Patents;
(ii) the expiration of the last exclusivity on any product granted by any regulatory or government body; (iii) the expiration
of a continuous period of twenty years plus any applicable patent extension period, during which there was no commercial sale of any product
in any country; or (iv) if we elect to obtain an exclusive license to the know-how under the terms of the 2019 Hebrew Agreement,
the expiration of such exclusive license.

 On January 1, 2020, CBR Pharma
and Yissum entered into the first amendment to the 2018 Hebrew Agreement (the " First Hebrew Amendment "), which provided
for additional research to be done at Yissum on new derivatives of certain molecules. Pursuant to the terms of the First Hebrew Agreement
Amendment, we will pay Yissum $200,000 per year plus 35% additional for University overhead for the additional research performed by each
professor over an 18-month period, starting May 1, 2019. The additional research ended in April 2021 and further preclinical work is expected
to be undertaken following research and development of a potentially successful drug delivery method, which is in its late stage development.

 Research Agreements with
the University of Oxford

 On November 1, 2013, our wholly-owned
subsidiary 180 LP entered into an agreement (the " First Oxford Agreement ") with Oxford, pursuant to which 180
LP will sponsor Oxford's research and development of repurposing anti-TNF for Dupuytren's Contracture.

 Pursuant to the First Oxford
Agreement, each payment is to be made to ISIS Innovation (now Oxford University Innovation) at different milestones of the project,
outlined below:

 Fee

 Minimum investment completed

 10,000

 Initiation of Phase 2 trial for a licensed product

 10,000

 Initiation of Phase 3 trial for a licensed product

 10,000

 Registerable Phase 3 trial primary endpoint achieved for a licensed product

 20,000

 Any issued U.S. patent of the licensed intellectual property rights

 5,000

 Approval by FDA of a New Drug Application (" NDA ") filed by 180 LP or one of its sub-licensees for a licensed product

 30,000

 Approval by EMA of an MAA filed by 180 LP or one of its sub-licensees for a licensed product

 30,000

 First commercial sale of a licensed product by 180 LP or any sub-licensee in the U.S.

 First commercial sale of a licensed product by 180 LP or any sub-licensee in the EU

 ISIS Innovation is also eligible
for royalty payments equal to 0.5% of net sales in any country where there is a valid claim, 0.25% of net sales in other countries and
a fee income royalty rate of 7.5% on all up-front, milestone and other one-off payments under or in connection with all sub-licenses and
other contracts granted by 180 LP with respect to the licensed technology. The First Oxford Agreement is effective, unless earlier terminated,
for so long as the specified patent application remains in effect as an issued patent, pending patent application or supplementary protection
certificate or for a term of 20 years, whichever is longer.

 On August 15, 2018, CannBioRex
Pharma Limited, a company incorporated under the laws of England and Wales (" CannU.K. ") and a wholly-owned subsidiary
of our wholly-owned subsidiary CBR Pharma, entered into the Research Agreement (the " Second Oxford Agreement ") with
Oxford, pursuant to which CBR Pharma (through CannU.K.) has sponsored Oxford's research and development of SCAs developed from
the Hebrew Licensed Technology. At Oxford, the SCAs generated in the Hebrew University are being tested for analgesic and anti-inflammatory
effects in established pre-clinical models.

 Pursuant to the Second Oxford
Agreement, Oxford undertook a research project (the " Research Project ") based around the clinical development
of SCAs that are known to exhibit both anti-inflammatory and immunomodulatory properties. The aim of the Research Project was to develop
and characterize chemical compounds that are synthesized at Hebrew University to create treatments for chronic pain, RA and other chronic
inflammatory conditions, and to eventually obtain regulatory approval to initiate early-phase clinical trials by mid to late 2022 or as
soon as possible thereafter. The Second Oxford Agreement had an initial term of one year beginning on March 22, 2019, but was extended
by amendment to March 31, 2020, or any later date agreed to by the parties, unless terminated earlier. The Second Oxford Agreement was
not extended any further after March 31, 2020, and CannU.K.'s relationship with Oxford continued with additional agreements with
Oxford, as described below.

 CannU.K., as the sponsor of
the Research Project, made the following payments to Oxford pursuant to the Second Oxford Agreement:

 Fee

 Signature of the Oxford Agreement

 166,800

 6 months post start of the Research Project

 166,800

 9 months post start of the Research Project

 166,800

 12 months post start of the Research Project, after report

 55,600

 On September 18, 2020, CannU.K.
entered into another research agreement with Oxford (the " Third Oxford Agreement "), pursuant to which CannU.K. sponsors
work led by Prof. Nanchahal at the University of Oxford to investigate the mechanisms underlying fibrosis. In connection with the agreement,
CannU.K. initially provided $100,000 and then at 6-month intervals further funding to support the salary of Dr. Lynn Williams and consumables.

 CannU.K., as the sponsor,
agreed to make the following payments to Oxford pursuant to the Third Oxford Agreement:

 Due
 (excluding
 VAT)

 30 days post signing of the Third Oxford Agreement

 80,000

 6 months post signing of the Third Oxford Agreement

 178,867

 12 months post signing of the Third Oxford Agreement

 178,867

 24 months post signing of the Third Oxford Agreement

 178,867

 36 months post signing of the Third Oxford Agreement

 178,867

 On September 21, 2020, CannU.K.
entered into another research agreement with Oxford (the " Fourth Oxford Agreement "), pursuant to which CannU.K. agreed
to sponsor work at the University of Oxford to develop and characterize novel cannabinoid derived new chemical entities (NCEs) for
the treatment of inflammatory diseases towards initiation of early phase clinical trials in patients within a period of 3 years.

 CannU.K., as the sponsor,
agreed to make the following payments to Oxford pursuant to the Fourth Oxford Agreement:

 Due
 (excluding
 VAT)

 30 days post signing of the Fourth Oxford Agreement

 6 months post signing of the Fourth Oxford Agreement

 12 months post signing of the Fourth Oxford Agreement

 18 months post signing of the Fourth Oxford Agreement

 24 months post signing of the Fourth Oxford Agreement

 On March 22, 2022, CannU.K.
entered into an amendment to the Fourth Oxford Agreement, to extend the research period to December 31, 2023, at no additional cost to
CannU.K.

 On May 24, 2021, CannU.K.
entered into another research agreement with Oxford (the " Fifth Oxford Agreement "), pursuant to which CannU.K. will
sponsor work at the University of Oxford to conduct a multi-center, randomized, double blind, parallel group, feasibility study of anti-TNF
injection for the treatment of adults with frozen shoulder during the pain-predominant phase.

 CannU.K., as the sponsor,
agreed to make the following payments to Oxford pursuant to the Fifth Oxford Agreement:

 Due
 (excluding
 VAT)

 Upon signing of the Fifth Oxford Agreement

 6 months post signing of the Fifth Oxford Agreement

 12 months post signing of the Fifth Oxford Agreement

 24 months post signing of the Fifth Oxford Agreement

 Oxford License Agreement

 On November 3, 2021, we entered
into an exclusive license agreement with Oxford University Innovation Limited (" Oxford License Agreement "), pursuant
to which we were granted the rights to certain patents related to the HMGB1 molecule for liver regeneration.

 Pursuant to the Oxford License
Agreement, we agreed to the following payment terms:

 Payment

 Due

 Past patent costs

 49,207

 License fee

 10,000

 Annual maintenance fee

 3,000

 Due

 Submission of IND

 25,000

 1 st Subject dosed in Phase I studies for each product, each indication

 25,000

 1 st Subject dosed in Phase II studies for each product, each indication

 100,000

 1 st Subject dosed in Phase III studies for each product, each indication

 Submission of New Drug Application for each product for each indication

 Issued U.S. patent, per patent

 5,000

 Receipt of Regulatory Approval in the U.S. for each product for each indication

 1,250,000

 Receipt of Regulatory Approval in the EU or U.K. for each product for each indication

 550,000

 Receipt of Regulatory Approval in the Japan for each product for each indication

 150,000

 Aggregate Net Sales Exceed $5Bn

 10,000,000

 Aggregate Net Sales Exceed $10Bn

 50,000,000

 Net Sales (US$)

 Royalty
 Rate

 < $250M

 1.00
 %

 $250M - $1B

 2.00
 %

 $1B - $10B

 3.00
 %

 > $10B

 3.50
 %

 Due to the ongoing costs of
this research program and the need for the Company to focus its resources on the Company's primary platform to treat fibrosis using
anti-TNF (tumor necrosis factor), the Board of Directors of the Company elected to terminate the Company's HMGB1 license agreement
with Oxford on September 22, 2023, and on September 22, 2023, the Company and Oxford entered into a termination letter, formally terminating
the License effective September 22, 2023. The termination letter also clarified amounts that we owed after termination of the License,
including approximately $20,000 in unbilled fees. No material early termination penalties were incurred by the Company in connection with
the termination of the license.

 Stanford License Agreement

 On May 8, 2018, Katexco Pharmaceuticals
Corp, a wholly-owned subsidiary of our wholly-owned subsidiary Katexco, entered into an option agreement (the " Stanford Option ") with
the Board of Trustees of the Leland Stanford Junior University (" Stanford "), pursuant to which Stanford granted Katexco
an option to acquire an exclusive license for the development and commercialization of certain inventions. In consideration for the Stanford
Option, Katexco paid Stanford $10,000 (the " Option Payment "), creditable against the license issue fee agreement.

 On July 25, 2018 (the " Stanford
Effective Date "), Katexco exercised the Stanford Option, and entered into an exclusive license agreement (the " Stanford
License Agreement ") with Stanford, pursuant to which Katexco was granted the rights to certain U.S. patents related to
(i) alpha B-crystallin as a therapy for autoimmune demyelination and (ii) peptides as short as six amino acids that form amyloid
fibrils that activate B-1 cells and macrophages and are anti-inflammatory and therapeutic in autoimmune and neurodegenerative diseases
(the " Stanford Licensed Patents "). Through the Stanford License Agreement, Katexco established research facilities
at Stanford. We will support the clinical development of the lead compound(s), culminating in Phase 1 and Phase 2 clinical trials to establish
potential clinical utility in ulcerative colitis indications.

 Under the Stanford License
Agreement, no rights of Stanford, including intellectual property rights, are granted to Katexco other than those rights granted under
the Stanford Licensed Patents.

 As consideration for the grant
of the Stanford Licensed Patents, Katexco paid Stanford an initial fee of $50,000, inclusive of the Option Payment. We also issued 294
common shares to Stanford and provided a letter stating the value of such shares. A portion of the shares issued to Stanford were later
distributed to five individuals, including our Chief Scientific Officer and co-chairman.

 Beginning upon the first anniversary
of the Stanford Effective Date and each anniversary thereafter, Katexco will pay Stanford an annual license maintenance fee of $20,000
on the first and second anniversaries and $40,000 on each subsequent anniversary. Furthermore, Katexco is obligated to make the following
payments, including (i) $100,000 upon initiation of Phase 2 trial, (ii) $500,000 upon the first FDA approval of a product (the
" Licensed Product ") resulting from the Stanford Licensed Patents, and (iii) $250,000 upon each new Licensed
Product thereafter. Royalties, calculated at 2.5% of net sales (calculated as gross revenue received by Katexco or its sublicensees, their
distributors or designees, from the sale, transfer or other disposition of products based on the Stanford Licensed Patents minus 5%),
will be payable to Stanford. In addition, Katexco has reimbursed Stanford $51,385 to offset the Stanford Licensed Patent's patenting
expenses and will reimburse Stanford for all Stanford Licensed Patent's patenting expenses, including any interference and or re-examination
matters, incurred by Stanford after March 3, 2018.

 We can terminate the Stanford
License Agreement without cause by providing a 30-day notice. In the case of a change of control, upon the assignment of the Stanford
License Agreement, Katexco is obligated to pay Stanford a $200,000 change of control fee. The Stanford License Agreement also provides
Stanford with the right to purchase for cash up to either (i) 10% or (ii) the percentage necessary for Stanford to maintain
its pro rata ownership interest in Katexco, of Katexco's equity securities issued in a private offering. The shares issued to Stanford
in connection with the Stanford License Agreement, gave Stanford and the five individuals who received a portion of the shares a total
ownership of 2.11% in Katexco's stock, prior to the July 2019, corporate restructuring completed between 180 and each of 180 LP,
Katexco and CBR Pharma, pursuant to which 180 LP, Katexco and CBR Pharma became wholly-owned subsidiaries of 180LS (the " Reorganization ") under
the Business Corporations Act (British Columbia).

 The Petcanna Agreement

 On August 20, 2018, we entered
into a sublicense agreement with Petcanna Pharma Corp. (" Petcanna "), a private company which was founded by Prof.
Sir Marc Feldmann (our Executive Co-Chairman), and Yissum (the " Petcanna Agreement ").

 Under the Petcanna Agreement,
we granted Petcanna an exclusive, worldwide, non-transferable, non-sublicensable sublicense to make commercial use of certain patents
related to cyclohexenyl compounds and listed in the Petcanna Agreement (the " Petcanna IP ") in order to develop,
manufacture, market, distribute or sell products that incorporate the Petcanna IP in products that are intended for the treatment of
veterinary medical conditions, initially osteoarthritis.

 As consideration for the
sublicense, Petcanna agreed to issue to us approximately 9,000,000 of Petcanna's common shares in the fourth quarter of 2018. As
of the date of this Report, Petcanna has not issued shares to any stockholder and has not commenced operations. We intend to retain 85%
of such shares and transfer 15% of such shares to Yissum. In the event that Yissum does not accept such shares, we will have an obligation
to pay Yissum 15% of the-then current fair market value of such shares. Petcanna will also pay a 1% royalty to us on Petcanna's
net sales of products that incorporate the Petcanna IP.

 All right, title and interest
in and to the Petcanna IP, including any improvements to the Petcanna IP, will vest solely in our company.

 Unless the parties to the
Petcanna Agreement agree otherwise in writing, the Petcanna Agreement will terminate on the occurrence of the later of: (i) the
date of expiration of the last of the Petcanna IP, (ii) the date of the final expiration of exclusivity on any Product granted by
any regulatory or government body, and (iii) the expiration of a continuous period of twenty (20) years during which there
was no First Commercial Sale of any product. The terms "Product" and "First Commercial Sale" apply as they are
defined in the Petcanna Agreement. Our ability to grant this sublicense to Petcanna is contingent upon (i) Yissum having the necessary
rights to the Hebrew Patent Applications assigned to it from all applicable parties, (ii) Yissum being able to grant a license to
us per the terms of the Hebrew Agreement, and (iii) the Hebrew Patent Applications and any related resulting patents being valid
and maintained in good standing for the respective terms of the Hebrew Licensing Agreement and the Petcanna Agreement.

 Kennedy License Agreement

 On September 27, 2019, our
wholly-owned subsidiary 180 LP entered into an exclusive license agreement (the " Kennedy License Agreement ") with
the Kennedy Trust For Rheumatology Research (" Kennedy "), pursuant to which Kennedy granted to 180 LP an exclusive
license in the U.S., Japan and member countries of the EU (including the United Kingdom), to certain licensed patents (the " Kennedy
Licensed Patents "), including the right to grant sublicenses, and the right to research, develop, sell or manufacture any pharmaceutical
product (i) whose research, development, manufacture, use, importation or sale would infringe on the Kennedy Licensed Patents absent
the license granted under the Kennedy License Agreement or (ii) containing an antibody that is a fragment of or derived from an
antibody whose research, development, manufacture, use, importation or sale would infringe on the Kennedy Licensed Patents absent the
license granted under the Kennedy License Agreement, for all human uses, including the diagnosis, prophylaxis and treatment of diseases
and conditions.

 Under the Kennedy License
Agreement, Kennedy reserves the perpetual, irrevocable, non-exclusive, royalty-free, sublicensable, worldwide right for the Kennedy Licensed
Patents and its affiliates, employees, students and other researchers to carry out any acts which would otherwise infringe on the Kennedy
Licensed Patents for the purposes of teaching and carrying out research and development, including the right to accept external sponsorship
for such research and development and the right to grant sub-licenses for the same purposes.

 As consideration for the
grant of the Kennedy Licensed Patents, 180 LP paid Kennedy an upfront fee of 60,000, and will also pay Kennedy royalties equal
to (i) 1% of the net sales for the first annual $1 billion of net sales, and (ii) 2% of the net sales after the net sales are
at or in excess of $1 billion, as well as 25% of all sublicense revenue, provided that the amount of such percentage of sublicense revenue
based on amounts which constitute royalties shall not be less than 1% on the first cumulative $1 billion of net sales of the products
sold by such sublicenses or their affiliates, and 2% on that portion of the cumulative net sales of the products sold by such sublicenses
or their affiliates in excess of $1 billion.

 The term of the royalties
paid to Kennedy will expire on the later of (i) the last valid claim of a patent included in the Kennedy Licensed Patents which
covers or claims the exploitation of a product in the applicable country; (ii) the expiration of regulatory exclusivity for the
product in the country; or (iii) 10 years from first commercial sale of the product in the country.

 We may terminate the Kennedy
License Agreement without cause by providing 90-days' notice.

 Kinexum Agreement

 On January 13, 2023, we entered
into a contract with Kinexum in the ordinary course of business (the " MSA "). Pursuant to the MSA, Kinexum will provide
assistance to us in connection with the Conditional Marketing Authorisation (CMA) and Marketing Approval Application (MAA) which
we expect to submit to the MHRA in connection with our planned use of adalimumab to treat progressive early-stage Dupuytren's disease.
We do not anticipate significant costs related to the Kinexum agreement in 2024, as the Company is now required to complete a Phase 3
trial in Dupuytren's disease prior to submission of an MAA.

 Consulting Agreements

 The Consulting Agreements
are each described below.

 Prof. Jagdeep Nanchahal
Consulting Agreement

 On February 25, 2021, we
(and CannBioRex Pharma Limited, which was added as a party to the agreement later), entered into a Consultancy Agreement dated February
22, 2021, and effective December 1, 2020, with Prof. Jagdeep Nanchahal (as amended, the " Consulting Agreement "). Prof.
Nanchahal has been providing services to us and/or our subsidiaries since 2014, was previously a greater than 5% stockholder of the Company
and is currently the Chairman of our Clinical Advisory Board.

 On March 31, 2021, we entered
into a first amendment to Consultancy Agreement with Prof. Jagdeep Nanchahal (the " First Nanchahal Amendment "), which
amended the Consultancy Agreement entered into with Prof. Nanchahal on February 25, 2021, to include CannBioRex Pharma Limited, a corporation
incorporated and registered in England and Wales (" CannBioRex "), and an indirect wholly-owned subsidiary of the Company,
as a party thereto, and to update the prior Consultancy Agreement to provide for cash payments due to Prof. Nanchahal to be paid by CannBioRex,
for tax purposes, provide for CannBioRex to be party to certain other provisions of the agreement and to provide for the timing of certain
cash bonuses due under the terms of the agreement.

 Prof. Nanchahal is a surgeon
scientist focusing on defining the molecular mechanisms of common diseases and translating his findings through to early phase clinical
trials. He undertook his Ph. D., funded by the U.K. Medical Research Council, whilst a medical student in London and led a lab group funded
by external grants throughout his surgical training. After completing fellowships in microsurgery and hand surgery in the USA and Australia,
he was appointed as a senior lecturer at Imperial College. His research is focused on promoting tissue regeneration by targeting endogenous
stem cells and reducing fibrosis. In 2013 his group identified anti-tumor necrosis factor (TNF) as therapeutic target for Dupuytren's
Contracture, a common fibrotic condition of the hand. He previously lead a Phase 2b clinical trial funded by the Wellcome Trust and Department
of Health to assess the efficacy of local administration of anti-TNF in patients with early-stage Dupuytren's Contracture and a
clinical trial for patients with early-stage frozen shoulder. He is a proponent of evidence-based medicine and was the only plastic surgery
member of the NICE Guidance Development Groups on complex and non-complex fractures. He was a member of the group that wrote the Standards
for the Management of Open Fractures published in 2020. This is an open-source publication to facilitate the care of patients with these
severe injuries.

 Pursuant to the Consulting
Agreement, Prof. Nanchahal agreed, during the term of the agreement, to serve as a consultant to us and provide such services as the
Chief Executive Officer and/or our Board shall request from time to time, including but not be limited to: (1) conducting clinical
trials in the fields of Dupuytren's Contracture, frozen shoulder and post-operative delirium/cognitive decline; and (2) conducting
laboratory research in other fibrotic disorders, including fibrosis of the liver and lung (collectively, the " Services ").

 In consideration for providing
the Services, we (through CannBioRex Pharma Limited) agreed to pay Prof. Nanchahal 15,000 British Pounds (GBP) per month (approximately
$20,800) during the term of the agreement, increasing to GBP 23,000 (approximately $32,000) on the date (a) of publication
of the data from the phase 2b clinical trial for Dupuytren's Contracture (RIDD) and (b) the date that we have successfully
raised over $15 million in capital. The fee will increase annually thereafter to reflect progression in other clinical trials and laboratory
research as approved by our Board. We also agreed to pay Prof. Nanchahal a bonus (" Bonus 1 ") in the sum of GBP
100,000 upon submission of the Dupuytren's Contracture clinical trial data for publication in a peer-reviewed journal, which submission
occurred in December 2021, and which bonus was paid in December 2021. In addition, for prior work performed, including completion of the
recruitment to the RIDD (Dupuytren's) trial, we agreed to pay Prof. Nanchahal GBP 434,673 (approximately $605,000) (" Bonus
2 "). At the election of Prof. Nanchahal, Bonus 2 shall be paid at least 50% (fifty percent) or more, as Prof. Nanchahal
elects, in shares of our common stock, at a share price of $1,140.00 per share, or the share price on the date of the grant, whichever
is lower, with the remainder paid in GBP. Bonus 2 shall be deemed earned and payable upon us raising a minimum of $15 million in additional
funding, through the sale of debt or equity, after December 1, 2020 (the " Vesting Date ") and shall not be accrued,
due or payable prior to such Vesting Date. Bonus 2 shall be payable by us within 30 calendar days of the Vesting Date. Finally, Prof.
Nanchahal shall receive another one-time bonus (" Bonus 3 ") of GBP 5,000 (approximately $7,000) on enrollment
of the first patient to the phase 2 frozen shoulder trial, and another one-time bonus (" Bonus 4 ") of GBP 5,000
(approximately $7,000) for enrollment of the first patient to the phase 2 delirium/POCD trial. On March 30, 2021, we issued Prof.
Nanchahal 265 shares of our common stock in lieu of GBP 217,337 and on April 15, 2021, we issued Prof. Nanchahal 99 shares of our common
stock in lieu of GBP 82,588. We also waived the requirement for the Company having to raise $15 million in order for Prof. Nanchahal to
agree to receive an aggregate of GBP 300,000 via the issuance of shares. Prof. Nanchahal agreed that the remaining GBP 134,673 that is
due pursuant to Bonus 2 shall be paid after we have raised a minimum of $15 million in additional funding. On August 23, 2021, at the
request of Prof. Nanchahal, we agreed to issue Prof. Nanchahal 161 shares of common stock in consideration for the remaining 31% (or 134,749
GBP, or $184,606) of Bonus 2, based on a $1,140.00 per share price. The shares were issued under our 2020 Omnibus Incentive Plan,
which has been approved by stockholders.

 Effective on April 27, 2022,
we and CannBioRex entered into a Second Amendment to Consulting Agreement with Prof. Jagdeep Nanchahal (the " Second Nanchahal
Amendment "). Pursuant to the Second Nanchahal Amendment, Prof. Nanchahal agreed that upon acceptance of the data for the phase
2b clinical trial for Dupuytren's disease for publication (which occurred March 1, 2022, subject to editing and final approvals),
his monthly fee was increased to 23,000, provided that 4,000 of such increase shall be accrued and 19,000 per month
of such fees shall be payable per our payroll practices in cash by us starting effective March 1, 2022, and until the earlier of (a) November
1, 2022 or (b) such time as our Board determines that we have sufficient cash on hand to pay such accrued amounts, which we expect
will not be until we have raised a minimum of $15,000,000 (the " Funding Determination Date "), at which time all accrued
amounts shall be due.

 On December 28, 2022, we
and CannBioRex, entered into a Third Amendment to Consultancy Agreement with Prof. Nanchahal (the " Third Nanchahal Amendment ").
The Third Nanchahal Amendment amended the Consultancy Agreement to provide that the monthly cash fee payable to Prof. Nanchahal pursuant
to such agreement would remain at its then current rate, 23,000 per month, through December 31, 2022, and then increase to 35,000
per month during the term of the Consultancy Agreement from January 1, 2023, until the end of the term of the Consultancy Agreement (collectively,
the " Fee "). The Third Nanchahal Amendment also provided that the Fee will be adjusted yearly with the recommendation
of our Board or the Compensation Committee of the Company, which will consider in its determination of the amount of such increase, the
U.K. consumer price index and Prof. Nanchahal's contributions to advancing our mission, among other things. The Third Nanchahal
Amendment also provided that in the event the Consultancy Agreement is terminated by us for any reason other than cause, Prof. Nanchahal
is entitled to a lump sum payment of 12 months of his monthly fee as of the date of termination.

 Notwithstanding the above,
the Board or Compensation Committee of the Company may grant Prof. Nanchahal additional bonuses from time to time in their discretion,
in cash, stock or options.

 The Consulting Agreement
has an initial term of three years, and renews thereafter for additional three-year terms, until terminated as provided in the agreement,
and currently has a term through December 1, 2026. The Consulting Agreement can be terminated by either party with 12 months prior written
notice (provided our right to terminate the agreement may only be exercised if Prof. Nanchahal fails to perform his required duties under
the Consulting Agreement), or by us immediately if (a) Prof. Nanchahal fails or neglects efficiently and diligently to perform the
Services or is guilty of any breach of its or his obligations under the agreement (including any consent granted under it); (b) Prof.
Nanchahal is guilty of any fraud or dishonesty or acts in a manner (whether in the performance of the Services or otherwise) which,
in our reasonable opinion, has brought or is likely to bring Prof. Nanchahal, the Company or any of its affiliates into disrepute or
is convicted of an arrestable offence (other than a road traffic offence for which a non-custodial penalty is imposed); or (c) Prof.
Nanchahal becomes bankrupt or makes any arrangement or composition with his creditors. If the Consulting Agreement is terminated by us
for any reason other than cause, Prof. Nanchahal is entitled to a lump sum payment of 12 months of his fee as at the date of termination.

 The Consulting Agreement
includes a 12 month non-compete and non-solicitation obligation of Prof. Nanchahal, preventing him from competing against us in any part
of any country in which he was actively engaged in our business, subject to certain exceptions, including research conducted at the University
of Oxford. The Consulting Agreement also includes customary confidentiality and assignment of inventions provisions, in each case subject
to our previously existing agreements with various universities, including the University of Oxford, where Prof. Nanchahal serves as
a Professor of Hand, Plastic and Reconstructive Surgery.

 Service Agreement with
Prof. Sir Marc Feldmann

 On June 1, 2018, CannBioRex
Pharma Limited (" CannBioRex ") and Prof. Sir Marc Feldmann Ph. D., our Executive Co-Chairman, entered into a Service
Agreement (the " Feldmann Employment Agreement "). Pursuant to the Feldmann Employment Agreement, Prof. Sir Feldmann
serves as the Chairman, CEO and Executive Director of CannBioRex or in such other capacity consistent with his status. Prof. Sir Feldmann's
responsibilities include those customary for the roles in which he serves. Prof. Sir Feldmann receives compensation of 115,000
per year, with annual compensation reviewed by the Board and eligibility for discretionary bonuses, as determined by the Board. CannBioRex
also reimburses Prof. Sir Feldmann's travelling and other business expenses.

 Pursuant to the Feldmann
Employment Agreement, all intellectual property rights created by Prof. Sir Feldmann or related to his employment belong to and vest
in CannBioRex.

 The Feldmann Employment Agreement
contains a customary non-compete clause prohibiting Prof. Sir Feldmann from working for any competing businesses during the term of his
employment, or holding equity in other businesses, except he may hold or beneficially own securities of publicly-traded companies if
the aggregate beneficial interests of him and his family does not exceed 5% of that class of securities.

 Prof. Sir Feldmann is also
prohibited for 12 months following termination (the " Post-Termination Period ") to be involved in any capacity
with a competing business or potential joint venture in the United Kingdom or in any other country. During the Post-Termination Period,
he may not solicit business from CannBioRex and its affiliates' customers; or any company with whom he was actively involved in
the course of his employment; or about which he holds confidential information. Prof. Sir Feldmann further covenants to not interfere
with CannBioRex's business relationships by inducing or attempting to induce suppliers to take adverse actions during the Post-Termination
Period. He also agrees not to induce or attempt to induce any CannBioRex employee to leave the company during the Post-Termination Period.
The Feldmann Employment Agreement contains customary non-disclosure and confidentiality obligations, sick leave and vacation time.

 The Feldmann Employment Agreement
does not have a fixed term. Either party may terminate the agreement by delivering written notice 9 months in advance. CannBioRex may
also terminate the Feldmann Employment Agreement at any time with immediate effect by giving written notice. If CannBioRex terminates
Prof. Sir Feldmann's employment without providing 9 months written notice, he will become entitled to a payment equal to his basic
salary he would have been entitled to receive if 9 months' notice were given. The governing law for the Feldmann Employment Agreement
is the law of England.

 The Board, as recommended
by the Compensation Committee of the Company (and/or the Compensation Committee) or separately, may also award Prof. Sir Feldmann
bonuses from time to time (in stock, options, cash, or other forms of consideration) in its discretion.

 On November 17, 2021, the
Board, as recommended by the Compensation Committee, increased the salary of Prof. Sir Feldmann to $225,000 per annum.

 Effective on April 27, 2022,
CannBioRex and Prof. Sir Feldmann entered into an amendment to the consulting agreement, pursuant to which the parties agreed effective
March 1, 2022, that Sir Feldmann's salary would be reduced by $225,000 (100%), and that such reduced amounts would be accrued and
paid on the Funding Determination Date.

 On January 10, 2024, and
effective on January 1, 2024, the Company entered into a Second Amendment to Consulting Agreement with Prof. Sir Feldmann. Pursuant to
the amendment, Prof. Sir Feldmann, effective as of January 1, 2024, agreed to a reduction of his base salary set forth in his consulting
agreement by 100%, to 0 per year, with the amount of such salary reduction 14,167 per month or 170,000 per year),
accruing monthly in arrears, to be paid upon the Company raising at least $5,000,000 in funding subsequent to the date of the Amendments
(the " Funding Date "), provided that in the event the Funding Date does not occur prior to March 15, 2025, the amounts
accrued will be forgiven in their entirety.

 On March 7, 2024, Sir Marc
Feldmann, Ph. D. provided notice to the Board of Directors of his resignation as a member of the Board of Directors, effective on the same
date; see Note 13 – Subsequent Events, Resignation of Board Member, for further information.

 Consultancy Agreement
with Prof. Lawrence Steinman

 On November 17, 2021, and
effective on November 1, 2021, we entered into a Consulting Agreement with Lawrence Steinman, M.D., our Executive Co-Chairman (the " Consulting
Agreement "). Pursuant to the Consulting Agreement, Dr. Steinman agreed to provide certain consulting services to us, including,
but not limited to, participating in defining and setting strategic objectives of the Company; actively seeking out acquisition and merger
candidates; and having primary scientific responsibility for our 7nAChR platform (collectively, the " Services ").
The term of the agreement is for one year (the " Initial Term "); provided that the agreement automatically extends
for additional one year periods after the Initial Term (each an " Automatic Renewal Term " and the Initial Term together
with all Automatic Renewal Terms, if any, the " Term "), subject to the Renewal Requirements (described below), in the
event that neither party provided the other written notice of their intent not to automatically extend the term of the agreement at least
30 days prior to the end of the Initial Term or any Automatic Renewal Term. The Term can only be extended for an Automatic Renewal Term,
provided that (i) Dr. Steinman is re-elected to the Board at our Annual Meeting of Stockholders immediately preceding the date that
such Automatic Renewal Term begins; (ii) the Board affirms his appointment as Co-Chairman for the applicable Automatic Renewal Term
(or fails to appoint someone else as Co-Chairman prior to such applicable Automatic Renewal Term) and (iii) Dr. Steinman is
continuing in his role of having the responsibility for the scientific development for the Company's 7nAChR platform (the
" Renewal Requirements"). The Consulting Agreement also expires immediately upon the earlier of: (i) the
date upon which Dr. Steinman no longer serves as Co-Chairman and no longer has primary scientific responsibility for our 7nAChR
platform; and (ii) any earlier date requested by either (1) us (as evidenced by a vote of a majority of the Board (excluding
Dr. Steinman) at a meeting of the Board), or (2) Dr. Steinman (as evidenced by written notice from Dr. Steinman to the Board).
Additionally, we may terminate the Consulting Agreement immediately and without prior notice if Dr. Steinman is unable or refuses to
perform the Services, and either party may terminate the Consulting Agreement immediately and without prior notice if the other party
is in breach of any material provision of the Consulting Agreement.

 We agreed to pay Dr. Steinman
$225,000 per year during the term of the agreement, along with a one-time payment of $43,750, representing the difference between his
old compensation and new compensation, dating back to April 1, 2021. Pursuant to the Consulting Agreement, Dr. Steinman agreed to not
compete against us, unless approved in writing by the Board, during the term of the agreement, and also agreed to certain customary confidentiality
provisions and assignment of inventions requirements. The Consulting Agreement also has a 12-month non-solicitation prohibition following
its termination.

 On December 8, 2021, Dr. Steinman
was also granted stock options to purchase 65 shares of our common stock, which have a term of 10 years; an exercise price equal to the
fair market value of our common stock on the date of grant, $1,501.00 per share, and are subject to our 2020 Omnibus Incentive Plan. In
addition, beginning in calendar year 2022, for each year during the Term of the Consulting Agreement, we will, subject to future approval
by the Board, grant Dr. Steinman $125,000 of value of equity compensation. Future equity grants will vest over a 48-month period and be
in accordance with the Plan. Timing of the future grants, nature of the equity grants (e.g., RSU, PSU, restricted stock, etc.) and
any changes in the value of future equity will be recommended by our Compensation Committee and/or Audit Committee and approved by the
Board.

 Effective on April 27, 2022,
the Company and Dr. Steinman entered into an amendment to the consulting agreement, pursuant to which the parties agreed effective March
1, 2022, that Dr. Steinman's salary would be reduced by $56,250 (25%), and that such reduced amount would be accrued and paid on
the Funding Determination Date.

 On January 10, 2024, and
effective on January 1, 2024, the Company entered into a Third Amendment to Consulting Agreement with Lawrence Steinman. Pursuant to
the amendment, Dr. Steinman, effective as of January 1, 2024, agreed to a reduction of his base salary set forth in his consulting agreement
by 100%, to $0 per year, with the amount of such salary reduction ($18,750 per month or $225,000 per year), accruing monthly in arrears,
to be paid on the Funding Date, provided that in the event the Funding Date does not occur prior to March 15, 2025, the amounts accrued
will be forgiven in their entirety.

 Recent and Material Events

 On January 13, 2023, the
Company entered into a contract with Kinexum in the ordinary course of business (the " MSA "). Pursuant to the MSA,
Kinexum will provide assistance to the Company in connection with the Conditional Marketing Authorisation (CMA) and Marketing Approval
Application (MAA) which the Company expects to submit to the U.K. Medicines and Healthcare products Regulatory Agency (MHRA) in connection
with the Company's planned use of adalimumab to treat progressive early-stage Dupuytren's disease. We do not anticipate significant
costs related to the Kinexum agreement in 2024, as the Company is now required to complete a Phase 3 trial in Dupuytren's disease
prior to submission of an MAA.

 As previously discussed,
the Company's HMGB1 program was formed in connection with the entry into an exclusive global licensing agreement with Oxford
University Innovation Limited (" Oxford ") for the development and commercialization of HMGB1, a regenerative molecule
for promoting liver repair and regeneration, in November 2021 (the " License "). At the time, a physiological pathway,
activated by the molecule HMGB1, had been shown to lead to regeneration of tissues by targeting endogenous stem and progenitor cells.
However, after close to two years of research, it was found that the molecular interactions were much more complex than initially envisioned
and have remained unresolved. Hence, we have been unable to progress this research to a point of identifying a lead molecule to proceed
with scaling up and Good Manufacturing Practice (GMP) production, as well as safety and toxicity testing.

 Due to the ongoing costs
of this research program and the need for the Company to focus its resources on the Company's primary platform to treat fibrosis
using anti-TNF (tumor necrosis factor), the Board of Directors of the Company elected to terminate the Company's HMGB1 license
agreement with Oxford on September 22, 2023, and on September 22, 2023, the Company and Oxford entered into a termination letter, formally
terminating the License effective September 22, 2023. The termination letter also clarified amounts that we owed after termination of
the License, including approximately $20,000 in unbilled fees. No material early termination penalties were incurred by the Company in
connection with the termination of the license.

 On October 12, 2023, the
Company received a formal written scientific response from the United Kingdom's Medicines and Healthcare Products Regulatory Agency
(MHRA) regarding a meeting that was held on August 17, 2023 with the MHRA. The Company's management and regulatory team met with
the MHRA to propose a path forward for approval of the Company's use of adalimumab as an anti-TNF (tumor necrosis factor) therapy
for the potential prevention of the Dupuytren's contracture disability.

 In the response, the
MHRA (i) recognized the debilitating nature of the Dupuytren's Contracture; (ii) agreed with the Company's proposed primary
and secondary endpoints for a proposed Phase 3 clinical trial (Phase 3 study); (iii) agreed that a single Phase 3 study could be sufficient
to support a Marketing Authorization, if convincing evidence of efficacy and safety is observed; (iv) confirmed that the MHRA believes
that the results of the Company's Phase 2b trial resulted in too much uncertainty to support a Conditional Marketing Authorization
(CMA), because of the small number of trial participants, and that the MHRA would require the results of a Phase 3 study to consider
a Marketing Authorisation; and (v) provided the Company guidance on the potential Phase 3 study, including that a treatment course
consisting of four injections administered at 3-monthly intervals is acceptable.

 The Company is also currently
interacting with the FDA, and is ready to liaise with the European Medicines Agency (EMA), to attempt to obtain agreement on our proposed
clinical development plans, as outlined above for the MHRA guidance, and to work towards seeking approval of the use of adalimumab as
an anti-TNF therapy for potential prevention of the Dupuytren's contracture disability, in all of these jurisdictions.

 In support of our current
FDA interaction, a leading pharmaceutical biosimilar manufacturer has agreed to participate with the Company in the FDA advice discussion
regarding manufacturing and safety of the proposed biosimilar for adalimumab. In addition, such manufacturer has indicated that it wishes
to supply the anti-TNF biosimilar drug to be used in the Phase 3 study; however, no definitive agreements with the supplier have been
entered into to date. It is expected that any agreements with such supplier would be conditional upon the outcome of the aforementioned
FDA discussions, and we may be unable to come to mutually agreeable definitive terms with such supplier.

 The Company is currently
taking into consideration the guidance from the MHRA in its discussions with the FDA and planning the potential Phase 3 study to be carried
out, if necessary, provided that funding for such study is available.

 In December 2023, we engaged
A.G.P./Alliance Global Partners as financial advisor to explore and evaluate strategic alternatives to enhance shareholder value. Potential
strategic alternatives that may be explored or evaluated by the Company as part of this process include, but are not limited to, an acquisition,
merger, reverse merger, other business combination, sale of assets, licensing or other strategic transactions involving the Company.
The Company does not intend to discuss or disclose further developments during this process unless and until its Board of Directors has
approved a specific action or otherwise determined that further disclosure is appropriate. There is no assurance that the strategic review
process will result in the approval or completion of any specific transaction or outcome.

 Our common stock and Public
Warrants trade on Nasdaq under the symbols "ATNF" and " ATNFW, " respectively. Notwithstanding such listing,
there can be no assurance any broker will be interested in trading our securities. Therefore, it may be difficult to sell our securities
publicly. There is also no guarantee that we will be able to maintain our listings on Nasdaq for any period of time by perpetually satisfying
Nasdaq's continued listing requirements.

 On September 7, 2023, the
Company received written notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC (" Nasdaq ") notifying
the Company that it is not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for
continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum
bid price of $1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists
if the deficiency continues for a period of thirty (30) consecutive business days. Based on the closing bid price of the Company's
common stock for the thirty (30) consecutive business days from July 26, 2023 to September 6, 2023, the Company no longer meets
the minimum bid price requirement.

 The notification letter stated
that the Company has 180 calendar days or until March 5, 2024, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance,
the bid price of the Company's common stock must have a closing bid price of at least $1.00 per share for a minimum of 10 consecutive
business days. If the Company does not regain compliance by March 5, 2024, an additional 180 days may be granted to regain compliance,
so long as the Company meets The Nasdaq Capital Market initial listing criteria (except for the bid price requirement) and notifies
Nasdaq in writing of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if
necessary. If the Company does not qualify for the second compliance period or fails to regain compliance during the second 180-day period,
the Company's common stock will be subject to delisting, at which point the Company would have an opportunity to appeal the delisting
determination to a Hearings Panel.

 The Company intends to monitor the closing bid price of its common
stock and may, if appropriate, consider implementing available options to regain compliance with the minimum bid price requirement under
the Nasdaq Listing Rules, including affecting a reverse stock split. The Company plans to hold a special stockholders' meeting on
February 16, 2024, to seek approval, for among other things, an amendment to our Second Amended and Restated Certificate of Incorporation,
as amended, to effect a reverse stock split of our issued and outstanding shares of our common stock, by a ratio of between one-for-four
to one-for-forty, inclusive, with the exact ratio to be set at a whole number to be determined by our Board of Directors or a duly authorized
committee thereof in its discretion, at any time after approval of the amendment and prior to February 16, 2025. On February 16, 2024,
the Company's Board of Directors authorized a reverse stock split of our issued and outstanding shares of common stock in the amount
of one-for-nineteen, which was effective on February 28, 2024. On March 13, 2024, the Company received a letter from Nasdaq notifying
the Company that it has regained full compliance with the minimum bid price for continued listing on Nasdaq, pursuant to Nasdaq Listing
Rule 5550(a)(2), because Nasdaq has determined that for 10 consecutive business days, the closing bid price of the Company's common
stock was at or above $1.00 per share.

 On October 11, 2023, the
Company received written notice from Nasdaq notifying the Company that it was not in compliance with the shareholder approval requirements
set forth in Nasdaq Listing Rule 5635(d), which require prior shareholder approval for transactions, other than public offerings, involving
the issuance of 20% or more of the pre-transaction shares outstanding at less than the applicable Minimum Price (as defined in Listing
Rule 5635(d)(1)(A)).

 The Staff's determination
under Listing Rule 5635(d) relates to the offering and issuance by the Company of an aggregate of: (i) 35,102 shares of the
Company's common stock, at a price of $12.35 per share, (ii) pre-funded warrants to purchase up to 207,814 shares of common
stock, at a price of $12.3481 per pre-funded warrant and (iii) warrants to purchase up to 242,915 shares of common stock. The offering
price per share and associated common warrant was $12.35 and the offering price per pre-funded warrant and associated common warrant was
$12.3481.

 The Staff determined that
the offering was not a "public offering" for the purposes of Nasdaq's shareholder approval rules due to the type of
offering, a best efforts offering pursuant to a placement agency agreement, and the fact that one investor purchased 98% of the offering.
As a result, because the offering represented greater than 20% of the common stock outstanding and was priced below the Minimum Price,
the Staff determined that the Company was required to obtain prior shareholder approval under Listing Rule 5635(d).

 The October 11, 2023 letter
provided the Company 45 days to submit a plan to regain compliance. The plan of compliance was subsequently submitted by the Company
to Nasdaq on November 9, 2023, and on November 14, 2023, Nasdaq granted the Company an extension, until December 15, 2023, to complete
certain transactions set forth in the plan of compliance, in order to remedy its prior violation of Nasdaq rules as described in the
October 11, 2023 letter from Nasdaq.

 On August 14, 2023, we issued
and sold to certain investors, including a certain institutional investor (the " Purchaser "), an aggregate of: (i) 35,102
shares (the " August 2023 Shares ") of the Company's common stock, (ii) pre-funded warrants (the " August
2023 Pre-Funded Warrants ") to purchase up to 207,814 shares of common stock, and (iii) warrants (the " August 2023 Common
Warrants ") to purchase up to 242,915 shares of common stock, in the case of the Purchaser, pursuant to a securities purchase
agreement, dated as of August 9, 2023, between the Company and the Purchaser (the " August 2023 SPA ").

 On October 11, 2023, the
Company received written notice from the Listing Qualifications Department of Nasdaq notifying the Company that it was not in compliance
with the shareholder approval requirements set forth in Nasdaq Listing Rule 5635(d), which requires prior shareholder approval for transactions,
other than public offerings, involving the issuance of 20% or more of the pre-transaction shares outstanding at less than the applicable
Minimum Price (as defined in Listing Rule 5635(d)(1)(A)).

 Nasdaq's determination
under Listing Rule 5635(d) related to the August 2023 offering (the " August 2023 Offering "). The offering price per
share of common stock and associated August 2023 Common Warrant was $12.35 and the offering price per August 2023 Pre-Funded Warrant and
associated August 2023 Common Warrant was $12.3481.

 Nasdaq determined that the
August 2023 Offering was not a "public offering" for the purposes of Nasdaq's shareholder approval rules due to the
type of offering, a best efforts offering pursuant to a placement agency agreement, and the fact that one investor purchased 98% of the
August 2023 Offering. As a result, because the August 2023 Offering represented greater than 20% of the common stock outstanding and
was priced below the Minimum Price, Nasdaq determined that the Company was required to obtain prior shareholder approval under Listing
Rule 5635(d). In November and December 2023, the Company took various actions to amend the terms of the August 2023 Offering to comply
with Listing Rule 5635(d), as discussed below.

 On November 28, 2023, the
Company entered into Amendment No. 1 to the August 2023 SPA with the Purchaser (the " November 2023 SPA Amendment "),
pursuant to which (i) the Purchaser agreed to pay an additional $830,769.30 in connection with the repricing of the August 2023 Shares
and August 2023 Pre-Funded Warrants (the " Repricing Amount "), (ii) the Company agreed to issue to the Purchaser (x)
pre-funded warrants to purchase up to 257,205 shares of common stock, with an exercise price of $0.0019 per share (the " December
2023 Pre-Funded Warrants "), and (y) warrants to purchase up to 477,058 shares of common stock, with an exercise price of $3.23
per share (the " December 2023 Common Warrants " and, together with the December 2023 Pre-Funded Warrants, the " Warrants "),
and (iii) the Company and the Purchaser agreed to enter into the Warrant Amendment Agreement (as defined and described below).

 The Warrants will not be exercisable
until the Company obtains stockholder approval for the issuance of the 734,262 shares of common stock upon exercise of the Warrants (the
" Warrant Shares ")(" Stockholder Approval ", and the date of such Stockholder Approval, the " Stockholder
Approval Date "), at which point the December 2023 Pre-Funded Warrants will remain exercisable until all of the December 2023
Pre-Funded Warrants are exercised in full, and the December 2023 Common Warrants will remain exercisable until the fifth anniversary of
the Stockholder Approval Date (as defined below).

 The November 2023 SPA Amendment
contains certain customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification
obligations of the Company, other obligations of the parties, and termination provisions. Pursuant to the November 2023 SPA Amendment,
the Company has agreed that, subject to certain exceptions, it will not conduct any issuances of common stock (or equivalents thereof)
from the Closing Date until 15 days after the Stockholder Approval Date. The November 2023 SPA Amendment also requires the Company to
file a registration statement with the SEC to register the resale by the Purchaser of the Warrant Shares within sixty (60) days of the
Stockholder Approval Date.

 In accordance with the November
2023 SPA Amendment, the Company entered into a warrant amendment agreement with the Purchaser, dated November 28, 2023 (the " Warrant
Amendment Agreement "), whereby the Company agreed to amend the following outstanding warrants held by the Purchaser: (i) warrants
to purchase up to 135,339 shares of common stock, issued on December 22, 2022, and amended in January 2023, April 2023 and August 2023
(the " December 2022 Warrants "); (ii) warrants to purchase up to 16,138 shares of common stock, issued on July 20, 2022
and amended in April 2023 and August 2023 (the " July 2022 Warrants "); (iii) warrants to purchase up to 82,668 shares
of common stock, issued on April 10, 2023 and August 2023 (the " April and August 2023 Warrants ", and collectively with
the December 2022 Warrants and July 2022 Warrants, the " December 2022 Through August 2023 Warrants "); and (iv) warrants
to purchase up to 242,915 shares of common stock underlying the August 2023 Common Warrants (collectively, the " Existing Common
Warrants "). Pursuant to the Warrant Amendment Agreement, the Existing Common Warrants will be amended (the " Warrant
Amendment ") such that they will not be exercisable until the company obtains stockholder approval for the issuance of up to
477,058 shares of common stock upon exercise of the Existing Common Warrants (the " Existing Common Warrant Shares ").
The Existing Common Warrants will have an exercise price equal to $3.23 per share, and the Existing Common Warrants will expire on the
fifth anniversary of the Stockholder Approval Date (the " Repricing and Extension "). The other terms of the Existing
Common Warrants remain unchanged.

 The closing of the transactions
discussed above occurred on December 1, 2023 (the " Closing Date "). Upon the closing of the transactions, the Company
regained compliance with Nasdaq Listing Rule 5635(d).

 For purposes of obtaining
Stockholder Approval of the issuance of the Warrant Shares and the Existing Common Warrant Shares, the Company has agreed to hold a Stockholder
Meeting (as defined in the November 2023 SPA Amendment) on or prior to the date that is ninety (90) days following the Closing Date (and
has scheduled such meeting for February 16, 2024). If the Company does not obtain Stockholder Approval at the first Stockholder Meeting,
the Company will call a Stockholder Meeting every ninety (90) days thereafter until the earlier of: (i) the date on which Stockholder
Approval is obtained or (ii) the Warrants and the Existing Common Warrants are no longer outstanding.

 Simultaneously with the closing
of the transactions, the Company entered into a warrant agent agreement (the " Warrant Agent Agreement ") with Continental
Stock Transfer & Trust Company (" Continental "), pursuant to which Continental will act as warrant agent with respect
to the Warrants.

 As a result of those transactions,
on December 14, 2023, Nasdaq provided the Company written notice that the Company has complied with the terms of the prior extension;
that the Company complies with Listing Rule 5635(d)(1)(A)); and that the matter is now closed.

 On November 15, 2023, the
Company received a letter from Nasdaq notifying the Company that it was not in compliance with the minimum stockholders' equity
requirement for continued listing on the Nasdaq Capital Market. Nasdaq Listing Rule 5550(b)(1) (the " Rule ") requires
companies listed on the Nasdaq Capital Market to maintain stockholders' equity of at least $2,500,000. In the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 2023, the Company reported a stockholders' deficit of ($149,327), which
is below the minimum stockholders' equity required for continued listing pursuant to the Rule. Additionally, the Company does not
meet the alternative Nasdaq continued listing standards under Nasdaq Listing Rules.

 Nasdaq provided the Company
until January 2, 2024 to submit to Nasdaq a plan to regain compliance. We submitted the plan to regain compliance in a timely manner,
and on January 11, 2024, Nasdaq advised the Company that it has determined to grant the Company an extension to regain compliance with
the Rule.

 The terms of the extension
are as follows: on or before May 13, 2024, the Company must complete certain transactions described in greater detail in the compliance
plan, contemplated to result in the Company increasing its stockholders' equity to more than $2.5 million, and opt for one of the
two following alternatives to evidence compliance with the Rule: Alternative 1: The Company must furnish to the SEC and Nasdaq a publicly
available report (e.g., a Form 8-K) including: 1. A disclosure of Staff's deficiency letter and the specific deficiency(ies) cited;
2. A description of the completed transaction or event that enabled the Company to satisfy the stockholders' equity requirement
for continued listing; and 3. An affirmative statement that, as of the date of the report, the Company believes it has regained compliance
with the stockholders' equity requirement based upon the specific transaction or event referenced in Step 2; or Alternative 2: The
Company must furnish to the SEC and Nasdaq a publicly available report including: 1. Steps 1 & 2 set forth above; 2. A balance sheet
no older than 60 days with pro forma adjustments for any significant transactions or event occurring on or before the report date; and
3. That the Company believes it satisfies the stockholders' equity requirement as of the report date. The pro forma balance sheet
must evidence compliance with the stockholders' equity requirement.

 Additionally, in either case
the Company is required to disclose that Nasdaq will continue to monitor the Company's ongoing compliance with the stockholders'
equity requirement and, if at the time of its next periodic report the Company does not evidence compliance, that it may be subject to
delisting.

 Regardless of which alternative
the Company chooses, if the Company fails to evidence compliance upon filing its next periodic report with the SEC following the end
of such compliance period (i.e., its Quarterly Report for the Quarter ended June 30, 2024), the Company may be subject to delisting.
In the event the Company does not satisfy these terms, Nasdaq will provide written notification that its securities will be delisted.
At that time, the Company may appeal Nasdaq's determination to a Hearings Panel.

 The Company is currently
evaluating various courses of action to regain compliance and is hopeful that it can regain compliance with Nasdaq's minimum stockholders'
equity standard within the compliance period. However, there can be no assurance that the Company will be able to complete the transactions
contemplated in the compliance plan, which the Company expects will allow it to regain compliance with the Rule, or that such transactions
will result in the Company regaining compliance with the Rule, within the compliance period granted by Nasdaq, if at all. If we fail
to timely remedy our compliance with such applicable requirement, our common stock and Public Warrants may be delisted.

 Effective on December 17, 2023,
Donald A. McGovern, Jr., resigned as a member of the Board of Directors of the Company. Mr. McGovern's resignation was due to health
reasons. Effective on December 17, 2023, Francis Knuettel II, Pam Marrone, Teresa DeLuca, Larry Gold, and Russell Ray, resigned as members
of the Board of Directors of the Company; their resignations were in connection with a difference of opinion on cost cutting initiatives.

 Mr. McGovern, Mr. Knuettel,
Dr. DeLuca, Dr. Gold and Mr. Ray, represented all of our independent directors and as such, as of December 17, 2023, we have no independent
directors, nor any members of our Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee, and Risk, Safety
and Regulatory Committee. We are currently seeking qualified individuals to appoint as independent members of the Board of Directors;
see Note 13 – Subsequent Events, New Board Members Appointed and Resignation of Board.

 Due to recent financial constraints,
the Company has been unable to timely pay amounts due to the University of Oxford, the licensor of the majority of the Company's
licenses and patents and the Company's research partner. Oxford alleges that an aggregate of approximately 929,030 is owed
from the Company and one of its subsidiaries to Oxford under the terms of licenses and agreements with Oxford and related parties. The
Company is currently in ongoing discussion with Oxford to reduce that amount and enter into a payment plan with regards to the amounts
owed, and has received preliminary acceptance of a payment plan; however, no definitive terms or extensions have been agreed to date.
Oxford has also notified the Company that it is not willing to discuss any new projects or arrangements until all outstanding invoices
have been paid or a payment plan has been agreed to; has engaged a law firm to seek the collection of the amounts owed, together with
interest; and has threatened legal proceedings against us. While we are hopeful that we can come to mutually agreeable terms regarding
a settlement, payment plan, and/or extension, with Oxford, we may not have sufficient funds to pay amounts due to Oxford in the near term,
if at all, and Oxford may take action against us, including filing legal proceedings against us seeking amounts due and interest, attempting
to terminate their relationship with us, and/or filing a wind-up petition against one of the Company's subsidiaries in the U.K.
If Oxford were to take legal action against us or terminate their relationship with us, we may be forced to scale back our business plan
and/or seek bankruptcy protection. We may be subject to litigation and damages for our failure to pay amounts due to Oxford, and may be
forced to pay interest and penalties, which funds we do not currently have. We plan to seek to raise funding in the future to support
our operations, and to pay amounts due to Oxford, through a combination of equity offerings, debt financing or other capital sources,
including potentially collaborations, licenses and other similar arrangements, which may not be available on favorable terms, if at all.
The sale of additional equity or debt securities, if accomplished, may result in dilution to our then stockholders. Additionally, in December
2023, we engaged A.G.P./Alliance Global Partners as financial advisor to explore and evaluate strategic alternatives to enhance shareholder
value. Potential strategic alternatives that may be explored or evaluated by the Company as part of this process include, but are not
limited to, an acquisition, merger, reverse merger, other business combination, sale of assets, licensing or other strategic transactions
involving the Company. The Company does not intend to discuss or disclose further developments during this process unless and until its
Board of Directors has approved a specific action or otherwise determined that further disclosure is appropriate. There is no assurance
that the strategic review process will result in the approval or completion of any specific transaction or outcome.

 Intellectual Property

 Our success depends in significant
part on our ability to protect the proprietary elements of our product candidates, technology and know-how, to operate without infringing
on the proprietary rights of others, and to defend challenges and oppositions from others and prevent others from infringing on our proprietary
rights. We have sought, and will continue to seek, patent protection in the U.S., U.K., Europe and other countries for our proprietary
technologies.

 Our intellectual property portfolio as of March 20, 2024, includes
eleven patent families with issued and/or pending claims, pharmaceutical formulations, drug delivery and the therapeutic uses of SCAs,
as well as know-how and trade secrets, when including patents held by our partners of which we have exclusive rights.

 Within the U.S., we and/or
our partners have or have licensed fourteen issued patents and nine pending patent applications under active prosecution. Outside of
the U.S., assuming the EU as a single jurisdiction, there are an additional fifteen issued patents and thirteen pending patent applications
under active prosecution.

 Our policy is to seek patent
protection for the technology, inventions and improvements that we consider important to the development of our business, but only in
those cases where we believe that the costs of obtaining patent protection is justified by the commercial potential of the technology,
and typically only in those jurisdictions that we believe present significant commercial opportunities. We also rely on trademarks, trade
secrets, know-how and continuing innovation to develop and maintain our competitive position.

 The term of individual patents
depends upon the countries in which they are obtained. In most countries in which we have filed, the patent term is 20 years from the
earliest date of filing a non-provisional patent application. In the U.S., a patent's term may be lengthened by patent term adjustment,
which compensates a patentee for administrative delays by the U.S. Patent and Trademark Office ("USPTO"), in granting a patent,
or may be shortened if a patent is terminally disclaimed over another patent.

 The term of a patent that
covers an FDA-approved drug may also be eligible for extension, which permits term restoration as compensation for the term lost during
the FDA regulatory review process. The Drug Price Competition and Patent Term Restoration Act of 1984 (the Hatch-Waxman Act) permits
an extension of up to five years beyond the expiration of the patent. The length of the patent term extension is related to the length
of time the drug is under regulatory review. Extensions cannot extend the remaining term of a patent beyond 14 years from the date of
product approval and only one patent applicable to an approved drug may be extended. Similar provisions to extend the term of a patent
that covers an approved drug are available in Europe and other non-U.S. jurisdictions.

 To protect our rights to
any of our issued patents and proprietary information, we may need to litigate against infringing third parties, avail ourselves of the
courts or participate in hearings to determine the scope and validity of those patents or other proprietary rights.

 We also rely on trade secret
protection for our confidential and proprietary information. Our policy requires our employees, consultants, outside scientific collaborators,
sponsored researchers and other advisors to execute confidentiality agreements upon the commencement of employment or consulting relationships
with us.

 From time to time, in the
normal course of our operations, we will be a party to litigation and other dispute matters and claims relating to intellectual property.

 180LS' Research, Development and License Agreements

 180LS has entered into research
and licensing agreements with various parties, including the Hebrew University of Jerusalem and Oxford. For information regarding these
agreements, see " Material Agreements ", above.

 Competition

 Below is a description of
the competitive environment of each of our product candidate development platforms and potential product candidates.

 Dupuytren's Contracture

 Our treatment is for early-stage
Dupuytren's Contracture, for which, to our knowledge, there is no approved treatment. Existing treatments focus on late stage Dupuytren's
Contracture, when the fingers are irreversibly curled into the palm. Surgery remains the typical standard treatment, but the relatively
long post-operative rehabilitation has driven the reach for less invasive techniques. Xiaflex, a drug developed by Auxilium, has shown
effective in treating patients with developed contractures although many patients experience relatively mild side effects. An alternative
approach is disruption of the late-stage cords with a needle and data from a comparative clinical trial published in the Journal of Bone
and Joint Surgery (American) in 2018 showed similar recurrence rates between collagenase and percutaneous needle fasciotomy at 2
years. A clinical trial funded by the National Institute for Health Research Health Technology Assessment Programme (U.K.) is currently
underway in the U.K., comparing the cost efficacy of surgery for Dupuytren's Contracture with collagenase treatment. The aims of
the study are to determine (i) whether collagenase injections are as effective and as safe as surgery for treating this condition
and (ii) the costs of both treatments.

 SCAs

 Following the acquisition
of GW Pharmaceuticals PLC and its Epidiolex (cannabidiol) and Sativex (THC & CBD) franchises, by Jazz
Pharmaceuticals (Ireland), Jazz Pharma has become the prominent player in the cannabidiol space. Epidiolex is an
oral cannabidiol solution approved for treating seizures in a range of childhood epileptic diseases, including Dravet's syndrome
(formerly known as severe myoclonic epilepsy of infancy), Rett Syndrome, and Lennox-Gastaut Syndrome. Jazz Pharma is exploring whether
Epidiolex is effective in Sturge-Weber Syndrome, in which abnormal development of blood vessels leads to defects in the brain, skin,
and eyes from birth, and more broadly in Autism Spectrum Disorder. Clinical trials sponsored by Jazz Pharma testing effectiveness of
Epidiolex in autoimmune diseases such as multiple sclerosis, ulcerative colitis, and Crohn's Disease are ongoing. Collectively,
these efforts represent the most extensive cannabidiol clinical program.

 To our knowledge, multiple
companies are working in the cannabis therapeutic area and are pursuing regulatory approval for their product candidates, including:

 Cardiol Therapeutics (Canada) which is evaluating the
effectiveness of their oral CBD liquid formulation on myocardial recovery in patients presenting with acute myocarditis.

 Zynerba Pharmaceuticals (Pennsylvania) which focuses
on pharmaceutically produced transdermal cannabinoid therapies for rare and near-rare neuropsychiatric disorders. Zynerba currently is
evaluating ZygelTM, a patent-protected transdermal CBD gel for the treatment of Fragile X syndrome, for which it filed an NDA with the
FDA, developmental and epileptic encephalopathies, 22q deletion syndrome, and Autism Spectrum Disorder.

 Orcosa, (New Jersey) which is testing their CBD, Oravexx
(oral disintegrating tablets), to manage pain and inflammation with the hope of reducing clinical reliance on opioids. The particular
indication is pain associated with osteoarthritis in the knee in a Phase 2 trial.

 Stero Biotechs (Israel) which sponsored a phase II trial in GVHD
demonstrating that CBD administration (synthetic CBD in olive oil), either enhanced the therapeutic effect of steroids or reduced the
steroid dosage while maintaining or improving the steroid's original therapeutic effect. Additional clinical trials are a Phase
Iia, multi centered trial in steroid dependent Crohn's disease, a Phase Iia trial in chronic urticaia (Hives), and Phase I/II trial
in severe Covid-19.

 A7nAChR

 Antibodies selective for
TNFa (Humira) or TNFa receptor (Remicade) and nucleic acid aptamers are injectable reagents, which by their inherent nature
have clinical limitations. An orally bioavailable inhibitor of TNFa is a natural complementary reagent to the antibody or aptamer strategy.
This is particularly attractive if the mode of action differs between the varying therapeutic reagents. The antibodies and aptamers both
are designed to interfere with TNFa signaling, whereas the orally bioavailable drug is an 7 nicotinic acetyl choline receptor
agonist known to activate the vagus nerve and the brain- immune system interface.

 The 180LS program to develop
an orally bioavailable inhibitor of TNFa secretion has significant competition. The most prominent is the collection of Jak inhibitors
(Xeljanz, Cibinqo, Olumiant, Rinvoq and Jyseleca) approved for treatment of rheumatoid arthritis, psoriatic arthritis, juvenile
idiopathic arthritis, axial spondyloarthritis, ulcerative colitis, atopic dermatitis and alopecia areata. The mode of action is the inhibition
of the Jak-Stat pathway principally in cells of the macrophage lineages known to secrete a variety of proinflammatory cytokines including
TNFa. The commercial success of these reagents provides practical support for the importance of developing an orally bioavailable product.
These drugs are not involved in acetylcholine receptor pathway. Attenua Pharma, a small biotechnology that was using an 7nAChR
agonist, bradanicline, in Phase 2 clinical trials for chronic cough was acquired by Coda therapeutics and this program has been discontinued.

 The electroceutical companies
can be viewed as competition, or a vast proof-of-concept. Because in many respects, the 7nAChR program can be considered as a
chemical stimulation of the vagus nerve, and each of the indications benefiting from electrical stimulation, should be amenable to chemical
stimulation. To our knowledge, the company closest to an approved product for inflammatory indications is SetPoint Medical Corporation,
which has active for inflammatory bowel disease and rheumatoid arthritis. Their device is a miniaturized stimulator implant, which is
surgically placed under general anesthesia on the vagus nerve through a small incision on the left side of the neck. An unexpected result
is that a short electrical pulse leads to an extended period of reduction of inflammatory cytokines, of the order of 8-10 hours.

 A final consideration is
that each of the large pharmaceutical companies that initially developed 7nAChR agonists could revitalize their programs and use
their drugs in clinical trials for inflammatory indications.

 The electroceutical companies
can be viewed as competition, or a vast proof-of-concept. Because in many respects, the 7nAChR program can be viewed as a chemical
stimulation of the vagus nerve, and each of the indications benefiting from electrical stimulation, should be amenable to chemical stimulation.

 Lastly, each of the large
pharmaceutical companies that initially developed 7nAChR agonists could revitalize their programs and use their drugs in clinical
trials for inflammatory indications.

 Government Regulation

 We have obtained regulatory
approvals from the U.K. Medicines and Healthcare Products Regulatory Agency (MHRA) and the Dutch Centrale Commissie Mensgebonden
Onderzoek (CCMO), as well as from the relevant accredited ethics committees, in order to perform clinical trials in the U.K. and The
Netherlands solely for indications under the anti-TNF platform. Following the successful results of the Phase 2b Dupuytren's Contracture
clinical trial, we are preparing a conditional marketing authorization application to be filed with the MHRA. We have not held any meetings
with, and no applications or requests for approval have been submitted to, the U.S. Food and Drug Administration (" FDA ") for
any indications or products under the anti-TNF platform at this time.

 FDA Approval Process

 In the U.S., pharmaceutical
products, including drugs and biologics, are subject to extensive regulation by the FDA. Under the U.S. Federal Food, Drug, and Cosmetic
Act (the " FDC Act "), a " drug " is defined to include " articles intended for use in the
diagnosis, cure, mitigation, treatment, or prevention of disease in man or other animals " and " articles (other than
food) intended to affect the structure or any function of the body of man or other animals. " 21 USC 321(g). Like all drugs,
biological products are also used for the treatment, prevention or cure of disease in humans. However, in contrast to chemically synthesized
small molecular weight drugs, which have a well-defined structure and can be thoroughly characterized, biological products are generally
derived from living material, such as human, animal, or microorganism, are complex in structure, and thus are always fully characterized.
The U.S. Public Health Servicer Act (the " PHS Act ") defines a biological product as a " virus, therapeutic
serum, toxin, antitoxin, vaccine, blood, blood component or derivative, allergenic product, or analogous product applicable
to the prevention, treatment, or cure of a disease or condition of human beings. " 42 USC 262(i). FDA regulations and policies
have established that biological products include blood-derived products, vaccines, in vivo diagnostic allergenic products, immunoglobulin
products, products containing cells or microorganisms, and most protein products. Biological products subject to the PHS Act also meet
the definition of drugs under the FDC Act. Biological products are a subset of drugs, and therefore both are regulated
under provisions of the FDC Act. However, only biological products are licensed under section 351 of the PHS Act, although some therapeutic
protein products have been approved under section 505 of the FDC Act rather than the PHS Act.

 The FDC Act, PHS Act, and
other federal and state statutes and regulations, govern, among other things, the research, development, testing, manufacture, storage,
recordkeeping, approval, labeling, promotion and marketing, distribution, post-approval monitoring and reporting, sampling, and import
and export of drugs and biologics. Failure to comply with applicable U.S. requirements may subject a company to a variety of administrative
or judicial sanctions, such as imposition of clinical holds, FDA refusal to approve pending NDAs or the FDA's Biologics License
Application (BLAs) or supplements to approved NDAs/BLAs, withdrawal of approvals, warning letters, product recalls, product seizures,
total or partial suspension of production or distribution, injunctions, fines, civil penalties and criminal prosecution.

 Drug and biologic development
in the U.S. typically involves pre-clinical laboratory and animal tests, the submission to the FDA of an IND, which must become effective
before clinical testing may commence. For commercial approval, the sponsor must submit adequate tests by all methods reasonably applicable
to show that the drug/biologic is safe for use under the conditions prescribed, recommended or suggested in the proposed labeling. The
sponsor must also submit substantial evidence, generally consisting of adequate, well-controlled clinical trials to establish that the
drug/biologic will have the effect it purports or is represented to have under the conditions of use prescribed, recommended or suggested
in the proposed labeling, including meeting FDA standards for safety, and efficacy for drugs or purity and potency for biologics. Satisfaction
of FDA pre-market approval requirements typically takes many years and the actual time required may vary substantially based upon the
type, complexity and novelty of the product candidate or disease.

 Pre-clinical tests include
laboratory evaluation of product candidate chemistry, formulation and toxicity, as well as animal trials to assess the characteristics
and potential safety and efficacy of the product candidate. The conduct of the pre-clinical tests must comply with federal regulations
and requirements, including FDA's Good Laboratory Practice (" GLP "), Good Clinical Practice (" GCP "),
and Good Manufacturing Practice regulations (" GMP ") regulations and the U.S. Department of Agriculture's
regulations implementing the Animal Welfare Act of 1996. The results of pre-clinical testing are submitted to the FDA as part of an IND
along with other information, including information about product candidate chemistry, manufacturing and controls, and a proposed clinical
trial protocol. Long-term pre-clinical tests, such as animal tests of reproductive toxicity and carcinogenicity, may continue after the
IND is submitted.

 A 30-day waiting period after
the submission of each IND is required prior to the commencement of clinical testing in humans. If the FDA has not imposed a clinical
hold on the IND or otherwise commented or questioned the IND within this 30-day period, the IND is deemed issued, and the clinical trial
proposed in the IND may begin.

 Clinical trials involve the
administration of the investigational new drug/biologic to healthy volunteers or patients under the supervision of a qualified investigator.
Clinical trials must be conducted: (i) in compliance with GCP, an international standard and U.S. legal requirement meant to protect
the rights and health of patients and to define the roles of clinical trial sponsors, administrators and monitors, (ii) in compliance
with other federal regulations, and (iii) under protocols detailing the objectives of the trial, the parameters to be used in monitoring
safety and the effectiveness criteria to be evaluated. Each protocol involving testing on U.S. patients and subsequent protocol amendments
must be submitted to the FDA as part of the IND.

 The FDA may order the temporary,
or permanent, discontinuation of a clinical trial at any time or impose other sanctions if it believes that the clinical trial either
is not being conducted in accordance with FDA requirements or presents an unacceptable risk to the clinical trial patients. The trial
protocol and informed consent information for patients in clinical trials must also be submitted to an Institutional Review Board (" IRB "),
for approval. An IRB may also prevent a clinical trial from beginning or require the clinical trial at the site to be halted, either
temporarily or permanently, for failure to comply with the IRB's requirements or may impose other conditions.

 Clinical trials to support
NDAs/BLAs for marketing approval are typically conducted in three sequential phases, but the phases may overlap or otherwise vary in
particular circumstances. In Phase 1, the initial introduction of the drug/biologic into healthy human subjects or patients, the drug/biologic
is tested to assess metabolism, pharmacokinetics, pharmacological actions, side effects associated with increasing doses and, if possible,
early evidence on effectiveness. Phase 2 usually involves trials in a limited patient population to determine the effectiveness of the
drug/biologic for a particular indication, dosage tolerance and optimum dosage, and to identify common adverse effects and safety risks.
If a compound demonstrates evidence of effectiveness and an acceptable safety profile in Phase 2 evaluations, Phase 3 trials are undertaken
to obtain the additional information about clinical efficacy and safety in a larger number of patients, typically at geographically dispersed
clinical trial sites, to permit the FDA to evaluate the overall benefit-risk relationship of the drug/biologic and to provide adequate
information for the labeling of the drug/biologic. In most cases, the FDA requires two adequate and well-controlled Phase 3 clinical
trials to demonstrate the efficacy of the drug/biologic. The FDA may, however, determine that a single Phase 3 trial with other confirmatory
evidence may be sufficient in some instances. In some cases, the FDA may require post-market studies, known as Phase 4 studies, to be
conducted as a condition of approval in order to gather additional information on the drug's/biologic's effect in various
populations and any side effects associated with long-term use. Depending on the risks posed by the drugs/biologics, other post-market
requirements may be imposed.

 In response to specific requirements
set forth in the 21st Century Cures Act to address the need for greater patient participation in drug development and evaluation, the
FDA has issued its Plan for Issuances of Focused Drug Development Guidance, pursuant to which the FDA will issue a series of guidances
intended to address, in a stepwise manner, how stakeholders can collect and submit patient experience data and other relevant information
from patients and caregivers for medical product development and regulatory decision making. The guidances are expected to facilitate
the advancement and use of systematic approaches to collect and use robust and meaningful patient and caregiver input that can better
inform medical product development and regulatory decision making. To date, the FDA has issued three of the planned four guidances on
these issues. We expect the issue of patient-centric drug development and evaluation to increase in priority and be more of a factor
in clinical trial design, moving forward.

 After completion of the required
clinical testing, a New Drug Application (" NDA ")/BLA is prepared and submitted to the FDA. The FDA approval of the
NDA/BLA is required before marketing of the product candidate may begin in the U.S. The NDA/BLA must include the results of all pre-clinical,
clinical, and other testing and a compilation of data relating to the product candidate's pharmacology, chemistry, manufacture,
and controls. The cost of preparing and submitting an NDA/BLA is substantial. Under federal law, the submission of most NDAs/BLAs is
also subject to an application user fee, which, for the fiscal year 2023, is in the amount of approximately $4.0 million (where clinical
data is required).

 The FDA has 60 days from
its receipt of an NDA/BLA to determine whether the application will be accepted for filing based on the agency's threshold determination
that it is sufficiently complete to permit substantive review. Once the submission is accepted for filing, the FDA begins an in-depth
review. Under the Prescription Drug User Fee Act, the FDA has agreed to certain performance goals in the review of NDAs/BLAs. The FDA's
current performance goals call for the FDA to complete review of 90 percent of standard (non-priority) NDAs/BLAs within 10 months
of receipt and within six months for priority NDAs/BLAs, but two additional months are added to standard and priority NDAs/BLAs for a
new molecular entity/reference biologic. A drug/biologic is eligible for priority review if it addresses an unmet medical need in a serious
or life-threatening disease or condition. The review process for both standard and priority review may be extended by FDA for three additional
months to consider certain late-submitted information, or information intended to clarify information already provided in the submission.
These timelines are not legally binding on the FDA.

 The FDA may also refer applications
for novel drug/biologic products, or drug/biologic products that present difficult questions of safety or efficacy, to an advisory committee,
which is typically a panel that includes clinicians and other experts, for review, evaluation and a recommendation as to whether the
application should be approved. The FDA is not bound by the recommendation of an advisory committee, but it generally follows such recommendations.
Before approving an NDA/BLA, the FDA will typically inspect one or more clinical sites to assure compliance with GCP.

 Additionally, the FDA will
inspect the facility or the facilities at which the drug is manufactured. The FDA will not approve the product candidate unless compliance
with GMPs, is satisfactory and the NDA/BLA contains data that provide substantial evidence that the drug is safe and effective, or the
biologic meets the standards for safety, purity, and potency in the indication studied.

 After the FDA evaluates the
NDA/BLA and the manufacturing facilities, the FDA issues either an approval letter or a complete response letter. A complete response
letter generally outlines the deficiencies in the submission and may require substantial additional testing, or information, in order
for the FDA to reconsider the application. If, or when, those deficiencies have been addressed to the FDA's satisfaction in a resubmission
of the NDA/BLA, the FDA will issue an approval letter. The FDA has committed to reviewing 90 percent of resubmissions within two or six
months depending on the type of information included. Notwithstanding the submission of any requested additional information, the FDA
ultimately may decide that the application does not satisfy the regulatory criteria for approval.

 An approval letter authorizes
commercial marketing of the drug/biologic with specific prescribing information for specific indications. As a condition of NDA/BLA approval,
the FDA may require a Risk Evaluation and Mitigation Strategy (" REMS "), to help ensure that the benefits of the drug/biologic
outweigh the potential risks. REMS can include medication guides, communication plans for health care professionals, and Elements to
Assure Safe Use (ETASU). ETASU can include, but are not limited to, special training or certification for prescribing or dispensing,
dispensing only under certain circumstances, special monitoring, and the use of patient registries. The requirement for a REMS can materially
affect the potential market and profitability of the drug/biologic. Moreover, product candidate approval may require substantial post
approval testing and surveillance to monitor the drug's/biologic's safety or efficacy. Once granted, product candidate approvals
may be withdrawn if compliance with regulatory standards is not maintained or problems are identified following initial marketing.

 During the declaration of
the COVID public health emergency, the FDA has been exercising enforcement discretion with respect to certain classes of products and
has provided for the issuance of Emergency Use Authorizations (EUAs) which have enabled a number of products to enter the market
without formal conventional FDA clearance or approval, and has also drawn FDA resources away from non-COVID related products. The U.S.
government has since declared the termination of the public health emergency effective May 11, 2023.

 Disclosure of Clinical
Trial Information

 Sponsors of clinical trials
of certain FDA-regulated products, including prescription drugs/biologics, are required to register and disclose certain clinical trial
information on a public website maintained by the U.S. National Institutes of Health. Information related to the product candidate, patient
population, phase of investigation, study sites and investigator, and other aspects of the clinical trial is made public as part of the
registration. Sponsors are also obligated to disclose the results of these trials after completion. The deadline for submitting the results
of these trials can be extended for up to two years if the sponsor certifies that it is seeking approval of an unapproved product or
that it will file an application for approval of a new indication for an approved product within one year. Competitors may use the publicly
available information to gain knowledge regarding the design and progress of our development programs.

 Fast Track Designation
and Accelerated Approval

 If our drug/biologic candidate
meets the requirements of the FDA's fast track program, we would seek to have our drug/biologic candidate expedited through this
program. The FDA has programs to facilitate the development, and expedite the review of drugs/biologics that are intended for the treatment
of a serious or life-threatening disease or condition for which there is no effective treatment and which demonstrate the potential to
address unmet medical needs for the condition. Under the fast-track program, the sponsor of a new drug/biologic candidate may request
that the FDA designate the drug/biologic candidate for a specific indication as a fast track drug/biologic concurrent with, or after,
the filing of the IND for the drug/biologic candidate. The FDA must determine if the drug/biologic candidate qualifies for fast track
designation within 60 days of receipt of the sponsor's request. In addition to other benefits such as the ability to engage in
more frequent interactions with the FDA, the FDA may initiate review of sections of a fast track drug's/biologic's NDA/BLA
before the application is complete. This rolling review is available if the applicant provides, and the FDA approves, a schedule for
the submission of the remaining information and the applicant pays applicable user fees. However, the FDA's time period goal for
reviewing an application does not begin until the last section of the NDA/BLA is submitted. Additionally, the fast track designation
may be withdrawn by the FDA if it believes that the designation is no longer supported by data emerging in the clinical trial process.

 Under the FDA's accelerated
approval regulations, the FDA may approve a drug/biologic for a serious or life-threatening illness that provides meaningful therapeutic
benefit to patients over existing treatments based upon a surrogate endpoint that is reasonably likely to predict clinical benefit, or
on a clinical endpoint that can be measured earlier than irreversible morbidity or mortality, that is reasonably likely to predict an
effect on irreversible morbidity or mortality or other clinical benefit, taking into account the severity, rarity or prevalence of the
condition and the availability or lack of alternative treatments.

 In clinical trials, a surrogate
endpoint is a measurement of laboratory or clinical signs of a disease or condition that substitutes for a direct measurement of how
a patient feels, functions or survives. Surrogate endpoints can often be measured more easily or more rapidly than clinical endpoints.
A drug/biologic candidate approved on this basis is subject to rigorous post-marketing compliance requirements, including the completion
of Phase 4 or post-approval clinical trials to confirm clinical benefit. Failure to conduct required post-approval studies, or confirm
a clinical benefit during post-marketing studies, will allow the FDA to withdraw the drug/biologic from the market on an expedited basis.
Unless otherwise informed by the FDA, for an accelerated approval product/biologic, an applicant must submit to the FDA for consideration
during the preapproval review period copies of all promotional materials, including promotional labeling as well as advertisements, intended
for dissemination or publication within 120 days following marketing approval. After 120 days following marketing approval, unless otherwise
informed by the FDA, the applicant must submit promotional materials at least 30 days prior to the intended time of initial dissemination
of the labeling or initial publication of the advertisement.

 Breakthrough Therapy Designation

 As with the FDA's fast
track program, if our drug/biologic candidate meets the requirements to receive the FDA's Breakthrough Therapy designation, we
would seek to have our drug/biologic candidate expedited through this program. The FDA's Breakthrough Therapy designation program
is intended to expedite the development and review of products that treat serious or life-threatening diseases or conditions. A Breakthrough
Therapy is defined, under the Food and Drug Administration Safety and Innovation Act, as a drug/biologic that is intended, alone or in
combination with one or more other drugs/biologics, to treat a serious or life-threatening disease or condition, and preliminary clinical
evidence indicates that the drug/biologic may demonstrate substantial improvement over existing therapies on one or more clinically significant
endpoints, such as substantial treatment effects observed early in clinical development. The designation includes all of the features
of fast-track designation, as well as more intensive FDA interaction and guidance. The Breakthrough Therapy designation is a distinct
status from both accelerated approval and priority review, but these can also be granted to the same product candidate if the relevant
criteria are met. The FDA must take certain actions, such as holding timely meetings and providing advice, intended to expedite the development
and review of an application for approval of a breakthrough therapy. All requests for breakthrough therapy designation will be reviewed
within 60 days of receipt, and the FDA will either grant or deny the request.

 In addition, the 21st Century
Cures Act created the Regenerative Medicine Advanced Therapy (RMAT) designation. RMAT applies to regenerative medicines as a class.
Sponsors of certain cell therapies, therapeutic tissue engineering products, human cell and tissue products, and certain combination
products may obtain the RMAT designation for their drug product if the drug is intended to treat serious or life-threatening diseases
or conditions and if there is preliminary clinical evidence indicating that the drug has the potential to address unmet medical needs
for that disease or condition. Sponsors may make such a request with or after submission of an investigational new drug application.

 Sponsors of RMAT-designated
products are eligible for increased and earlier interactions with the FDA, similar to those interactions available to sponsors of breakthrough-designated
therapies. In addition, they may be eligible for priority review and accelerated approval. The meetings with sponsors of RMAT-designated
products may include discussions of whether accelerated approval would be appropriate based on surrogate or intermediate endpoints reasonably
likely to predict long-term clinical benefit, or reliance upon data obtained from a meaningful number of sites.

 Once approved, when appropriate,
the FDA can permit fulfillment of post-approval requirements under accelerated approval through the submission of clinical evidence,
clinical studies, patient registries, or other sources of real-world evidence such as electronic health records; through the collection
of larger confirmatory datasets; or through post-approval monitoring of all patients treated with the therapy prior to approval.

 Fast track designation, accelerated
approval, priority review, and Breakthrough Therapy designation do not change the standards for approval but may expedite the development
or approval process. Even if the FDA grants one of these designations, the FDA may later decide that the drug/biologic products no longer
meet the conditions for qualification.

 Orange Book Listing and
Patent Certification

 Based on amendments to the
FDC Act made by the Drug Price Competition and Innovation Act of 1984 (commonly known as Hatch-Waxman), in seeking approval for a drug
through an NDA, applicants are required to list with the FDA each patent whose claims cover the applicant's product candidate or
a claimed method of use of the product candidate. Upon approval of a drug, each of the eligible patents listed in the application for
the drug is then published in the FDA's Approved Drug Products with Therapeutic Equivalence Evaluations, commonly known as the
Orange Book. Drugs listed in the Orange Book must, in turn, be the subject of a special certification by the filer of an abbreviated
new drug application (" ANDA "), for a generic version of the drug, or by the applicant of a hybrid application known
as a 505(b)(2) application. An ANDA provides for marketing of a drug product candidate that has the same active ingredient(s) in
the same strengths and dosage form as the reference listed innovator drug and has been shown to be bioequivalent to the reference listed
drug. Other than the requirement for bioequivalence testing (absent a waiver), ANDA applicants are not required to conduct, or submit
results of, pre-clinical or clinical tests to prove the safety or effectiveness of their drug product candidate. Drugs approved in this
way are commonly referred to as "generic equivalents" to the listed drug, are considered therapeutically equivalent to the
listed drug, and can often be substituted by pharmacists under prescriptions written for the original listed drug.

 The ANDA applicant is required
to certify to the FDA concerning any patents listed for the approved product candidate in the FDA's Orange Book. Specifically,
the applicant must certify that: (i) the required patent information has not been filed; (ii) the listed patent has expired;
(iii) the listed patent has not expired, but will expire on a particular date and approval is sought after patent expiration; or
(iv) the listed patent is invalid or will not be infringed by the new product candidate. The ANDA applicant may also elect to submit
a " section viii statement ", certifying that its proposed ANDA labeling does not contain (or carves out) any language
regarding the patented method-of- use, rather than certify to a listed method-of-use patent.

 If the applicant does not
challenge the listed patents, the ANDA application will not be approved until all the listed patents claiming the referenced product
have expired.

 A certification that the
new product candidate will not infringe the already approved product candidate's listed patents, or that such patents are invalid
or unenforceable, is called a Paragraph IV certification. If the ANDA applicant has provided a Paragraph IV certification to the FDA,
the applicant must also send notice of the Paragraph IV certification to the NDA and patent holders once the ANDA has been accepted for
filing by the FDA. The NDA and patent holders may then initiate a patent infringement lawsuit in response to the notice of the Paragraph
IV certification. The filing of a patent infringement lawsuit within 45 days of the receipt of notice of a Paragraph IV certification
automatically prevents the FDA from approving the ANDA until the earlier of 30 months, expiration of the patent, settlement of the lawsuit,
a decision in the infringement case that is favorable to the ANDA applicant, or some other order of the court.

 Sponsors may also seek to
market versions of drug products via a section 505(b)(2) application, which is an NDA pathway that allows an applicant to seek approval
for a drug product based on full safety and efficacy documentation, some of which may be from literature or conducted by others and for
which the applicant does not have the right of reference. NDA Section 505(b)(2) applications may be submitted for drug products
that represent a modification, such as a new indication or new dosage form, of a previously approved drug. Section 505(b)(2) applications
may rely on the FDA's previous findings for the safety and effectiveness of the previously approved drug in addition to information
obtained by the 505(b)(2) applicant to support the modification of the previously approved drug. Preparing Section 505(b)(2) applications
may be less costly and time-consuming than preparing an NDA based entirely on new data and information. Section 505(b)(2) applications
are subject to the same patent certification procedures as an ANDA.

 New Chemical Entity Exclusivity
and Clinical Investigation Exclusivity

 Upon NDA approval of a new
chemical entity (" NCE "), which is a drug that contains no active moiety that has been approved by the FDA in any other
NDA, that drug receives five years of marketing exclusivity during which time the FDA cannot receive any ANDA or 505(b)(2) application
seeking approval of a drug that references a version of the NCE drug. Certain changes to a drug, such as the addition of a new indication
to the package insert with new clinical studies required for approval, are associated with a three-year period of exclusivity during
which the FDA cannot approve an ANDA or 505(b)(2) application that includes the change.

 An ANDA or 505(b)(2) application
may be submitted one year before NCE exclusivity expires if a Paragraph IV certification is filed. If there is no listed patent in the
Orange Book, there may not be a Paragraph IV certification and thus no ANDA or 505(b)(2) may be filed before the expiration of the
exclusivity period.

 For a botanical drug, the
FDA may determine that the active moiety is one or more of the principle components or the complex mixture as a whole. This determination
would affect the utility of any five-year exclusivity as well as the ability of any potential generic competitor to demonstrate that
it is the same drug as the original botanical drug.

 Five-year and three-year
exclusivities do not preclude FDA approval of a 505(b)(1) application for a version of the drug during the period of exclusivity,
provided that the 505(b)(1) conducts or obtains a right of reference to all of the pre-clinical studies and adequate and well controlled
clinical trials necessary to demonstrate safety and effectiveness.

 Orphan Designation and
Exclusivity

 The FDA may grant orphan
drug designation to drugs intended to treat a rare disease or condition that affects fewer than 200,000 individuals in the U.S., or if
it affects more than 200,000 individuals in the U.S. and there is no reasonable expectation that the cost of developing and making the
drug for this type of disease or condition will be recovered from sales in the U.S.

 Orphan drug designation entitles
a party to financial incentives such as opportunities for grant funding towards clinical study costs, tax advantages, and user-fee waivers.
Orphan drug designation does not convey any advantage in, or shorten the duration of, the regulatory review and approval process. In
addition, the first NDA or BLA applicant to receive orphan drug designation for a particular drug is entitled to orphan drug exclusivity,
which means the FDA may not approve any other application to market the same drug for the same indication for a period of seven years
in the U.S., except in limited circumstances. Orphan drug exclusivity does not prevent the FDA from approving a different drug for the
same disease or condition, or the same drug for a different disease or condition.

 Pediatric Studies and
Exclusivity

 NDAs and BLAs must contain
data to assess the safety and effectiveness of an investigational new drug product for the claimed indications in all relevant pediatric
populations in order to support dosing and administration for each pediatric subpopulation for which the drug is safe and effective.
The FDA may, on its own initiative or at the request of the applicant, grant deferrals for submission of some or all pediatric data until
after approval of the product for use in adults or full or partial waivers if certain criteria are met. Discussions about pediatric development
plans can be discussed with the FDA at any time, but usually occur any time between the end-of-Phase 2 meeting and submission of the
NDA or BLA. Unless otherwise required by regulation, the requirements for pediatric data do not apply to any drug for an indication for
which orphan designation has been granted.

 Pediatric exclusivity is
another type of non-patent exclusivity in the U.S. that may be granted if certain FDA requirements are met, such as the FDA's determination
that information relating to the use of a new drug in the pediatric population may produce health benefits, and the applicant agrees
to perform and report on FDA-requested studies within a certain time frame. Pediatric exclusivity adds a period of six months of exclusivity
to the end of all existing marketing exclusivity and patents held by the sponsor for that active moiety. This is not a patent term extension,
but it effectively extends the regulatory period during which the FDA cannot accept or approve another application relying on the NDA
or BLA sponsor's data.

 Biologics Exclusivity
and Biosimilars

 The Patient Protection and
Affordable Care Act of 2010, or Affordable Care Act, includes a subtitle called the Biologics Price Competition and Innovation Act of
2009, or BPCI Act, which amended the PHS Act to create an abbreviated approval pathway under section 351(k) of the PHS Act for biological
products shown to be similar to, or interchangeable with, an FDA-licensed reference biological product originally licensed under section
351(a) of the PHS Act.

 A reference biologic is granted
twelve years of marketing exclusivity from the time of first licensure of the reference product, during which time a 351(k) application
for a biosimilar of the reference product may not be approved. The reference biologic is also granted four years of so-called data exclusivity,
during which time a 351(k) application for a biosimilar of the reference product may not be submitted for review. The first biologic
product submitted under the abbreviated approval pathway that is determined to be interchangeable with the reference product has exclusivity
against other biologics submitting under the abbreviated approval pathway for the lesser of (i) one year after the first commercial
marketing, (ii) eighteen months after approval if there is no legal challenge, (iii) eighteen months after the resolution in
the applicant's favor of a lawsuit challenging the biologics' patents if an application has been submitted, or (iv) 42
months after the application has been approved if a lawsuit is ongoing within the 42-month period.

 Biologic Patent Information

 In contrast to small molecule
drugs, for which applicants are required to submit patent information with their NDAs and certain supplements, an applicant seeking licensure
of a biological product need not submit patent information in its BLA or supplements. Also, unlike small molecule drugs, for which the
approvability of ANDAs and 505(b)(2) NDAs is impacted by the status of listed patents for the reference NDA drug product, the approvability
of section 351(k) applications for biosimilar products is presently delinked from the various processes for resolving patent disputes.
Biosimilar applicants have a choice whether to engage in the patent litigation provisions of the Biologics Price Competition and Innovation
Act (BPCIA), colloquially known as the "patent dance," to identify and litigate a defined list of patents. However, unlike
the listing of small molecule reference listed drugs and patents in the "Orange Book," there had not been a process for listing
patents in the FDA's List of Licensed Biological Products, commonly known as the "Purple Book." However, in December
2020 Congress enacted the Biological Product Patent Transparency Act (" BPPT ") (originally introduced as the Purple
Book Continuity Act created section 351(k)(9) of the PHS Act). That section requires that a biological product reference sponsor
that provides a biosimilar applicant with a patent list as part of the "Patent Dance" BPCIA patent litigation process must
now submit those lists to the FDA within 30 days, and further, as of June 2021 the FDA is required to make those lists (along with any
revisions or updates) public in the Purple Book database.

 Patent Term Extension

 After NDA or BLA approval,
owners of relevant drug or biologic patents may apply for up to a five-year patent extension. The allowable patent term extension is
calculated as half of the product's testing phase - the time between IND submission and NDA or BLA submission - and all of the
review phase - the time between NDA submission and approval up to a maximum of five years. The time can be shortened if the FDA determines
that the applicant did not pursue approval with due diligence. The total patent term after the extension may not exceed 14 years.

 For patents that might expire
during the application phase, the patent owner may request an interim patent extension. An interim patent extension increases the patent
term by one year and may be renewed up to four times. For each interim patent extension granted, the post-approval patent extension is
reduced by one year. The director of the USPTO must determine that approval of the product covered by the patent for which a patent extension
is being sought is likely. Interim patent extensions are not available for a drug for which an NDA or BLA has not been submitted.

 Advertising and Promotion

 Once an NDA or BLA is approved,
a product candidate will be subject to certain post-approval requirements. For instance, the FDA closely regulates the post-approval
marketing and promotion of drugs and biologics, including standards and regulations for direct-to-consumer advertising, off-label promotion,
industry-sponsored scientific and educational activities and promotional activities involving the internet.

 Drugs and biologics may be
marketed only for the approved indications and in accordance with the provisions of the approved labeling.

 Post-Approval Changes

 Changes to some of the conditions
established in an approved application, including changes in indications, labeling, or manufacturing processes or facilities, require
submission and FDA approval of a new NDA/BLA or NDA/BLA supplement before the change can be implemented. An NDA supplement for a new
indication typically requires clinical data similar to that in the original application, and the FDA uses the same procedures and actions
in reviewing NDA supplements as it does in reviewing NDAs.

 Adverse Event Reporting
and GMP Compliance

 Adverse event reporting on
an expedited basis and submission of periodic adverse event reports is required following FDA approval of an NDA or BLA. The FDA also
may require post-marketing testing, known as Phase 4 testing, REMS and surveillance to monitor the effects of an approved product, or
the FDA may place conditions on an approval that could restrict the distribution or use of the product. In addition, quality-control,
drug manufacture, packaging, and labeling procedures must continue to conform GMPs after approval. Drug manufacturers and certain of
their subcontractors are required to register their establishments with the FDA and certain state agencies. Registration with the FDA
subjects entities to periodic unannounced inspections by the FDA, during which the agency inspects manufacturing facilities to assess
compliance with GMPs. Accordingly, manufacturers must continue to expend time, money and effort in the areas of production and quality
control to maintain compliance with GMPs. Regulatory authorities may withdraw product approvals, issue warning letters, request product
recalls or take other enforcement actions if a company fails to comply with regulatory standards, if it encounters problems following
initial marketing or if previously unrecognized problems are subsequently discovered.

 Special Protocol Assessment

 A sponsor may reach an agreement
with the FDA under the Special Protocol Assessment (" SPA "), process as to the required design and size of clinical
trials intended to form the primary basis of an efficacy claim. According to its performance goals, the FDA has committed to evaluating
90 percent of the protocols within 45 days of its receipt of the requests to assess whether the proposed trial is adequate, and that
evaluation may result in discussions and a request for additional information. An SPA request must be made before the proposed trial
begins, and all open issues must be resolved before the trial begins. If a written agreement is reached, it will be documented and made
part of the administrative record. Under the FDC Act and FDA guidance implementing the statutory requirement, an SPA is generally binding
upon the FDA as to the design of the trial except in limited circumstances, such as if the FDA identifies a substantial scientific issue
essential to determining safety or efficacy after the study begins, public health concerns emerge that were unrecognized at the time
of the protocol assessment, the sponsor and FDA agree to the change in writing, or if the study sponsor fails to follow the protocol
that was agreed upon with the FDA.

 Controlled Substances

 The Controlled Substances
Import and Export Act, as amended (" CSA ") and the implementing regulations impose registration, security, recordkeeping
and reporting, storage, manufacturing, distribution, dispensing, importation and other requirements on controlled substances under the
oversight of the U.S. Drug Enforcement Administration (" DEA "). The DEA is the federal agency, responsible for regulating
controlled substances, and requires those individuals or entities that manufacture, import, export, distribute, research, or dispense
controlled substances to comply with the regulatory requirements in order to prevent the diversion and abuse of controlled substances.

 The DEA regulates controlled
substances as Schedule I, II, III, IV or V substances, depending on the substance's medical effectiveness and abuse potential.
Pharmaceutical products having a currently accepted medical use that are otherwise approved for marketing may be listed as Schedule II,
III, IV or V substances, with Schedule II substances presenting the highest potential for abuse and physical or psychological dependence,
and Schedule V substances presenting the lowest relative potential for abuse and dependence. The DEA has placed certain drug products
that include cannabidiol, on Schedule V.

 Following NDA approval of
a drug containing a Schedule I controlled substance, that substance must be rescheduled as a Schedule II, III, IV or V substance before
it can be marketed. The Improving Regulatory Transparency for New Medical Therapies Act enacted on November 25, 2015 and its implementing
regulations has removed uncertainty associated with the timing of the DEA rescheduling process after NDA approval, under which a manufacturer
may market its product no later than 90 days after the later of: (1) the date on which the DEA receives from the FDA the scientific
and medical evaluation and scheduling recommendation; or (2) the date on which the DEA receives from the FDA notification that the
FDA has approved the drug. The Act also clarifies that the seven-year orphan exclusivity period begins with the approval of the NDA or
DEA scheduling, whichever is later. This changes the previous situation whereby the orphan " clock " began to tick upon
the FDA's NDA approval, even though the product could not be marketed until DEA scheduling was complete.

 The CSA requires that facilities
that manufacture, distribute, dispense, import or export any controlled substance must register annually with the DEA. Separate registrations
are required for importation and manufacturing activities, and each registration authorizes the specific schedules of controlled substances
the registrant may handle. Prior to issuance of a controlled substance registration, the DEA inspects all manufacturing facilities to
review security, recordkeeping, reporting and handling of the controlled substances. The specific security requirements vary by, among
other things, the type of business activity conducted, and the type, form, and quantity of controlled substances handled.

 In addition, individual states
have their own distinct controlled substance laws and regulations, including licensure, distribution, dispensing, recordkeeping and reporting
requirements for controlled substances. State boards of pharmacy or similar authorities regulate use of controlled substances in each
state. Failure to comply with applicable requirements, such as the loss or diversion of controlled substances, can result in administrative
fines, suspension or revocation of licenses, and civil and criminal liabilities.

 U.K./Europe/Rest of
World Government Regulation

 In addition to regulations
in the U.S., we are and will be subject, either directly or through our distribution partners, to a variety of regulations in other jurisdictions
governing, among other things, clinical trials and any commercial sales (including pricing and reimbursement) and distribution of our
products, if approved.

 Whether or not we obtain
FDA approval for a product, we must obtain the requisite approvals from regulatory authorities in non-U.S. countries prior to the commencement
of clinical trials or marketing of the product in those countries.

 In the EU, medicinal products
are subject to extensive pre- and post-marketing regulation by regulatory authorities at both the EU and national levels. Additional
rules also apply at the national level to the manufacture, import, export, storage, distribution and sale of controlled substances. In
many EU member states the regulatory authority responsible for medicinal products is also responsible for controlled substances. Responsibility
is, however, split in some member states. Generally, any company manufacturing or distributing a medicinal product containing a controlled
substance in the EU will need to hold a controlled substances license from the competent national authority and will be subject to specific
record-keeping and security obligations. Separate import or export certificates are required for each shipment into or out of the member
state.

 In the U.K., medicinal products
are subject to extensive regulation by the Medicines and Healthcare products Regulatory Agency (" MHRA "), which is
an executive agency, sponsored by the Department of Health and Social Care. MHRA regulates by ensuring that medicines, medical devices
and blood components for transfusion meet applicable standards of safety, quality and efficacy, in addition to supporting innovation
and research and development that is beneficial to public health.

 Clinical Trials and Marketing
Approval

 Certain countries outside
of the U.S. have a process that requires the submission of a clinical trial application much like an IND prior to the commencement of
human clinical trials. In the European Union/European Economic Area (" EEA "), for example, a clinical trial application
(a " CTA "), must be submitted via a single-entry portal for all clinical trials conducted in the EU/EEA (the " CTIS ").
Once the CTA is approved in accordance with a country's requirements and a company has received favorable ethics committee approval,
clinical trial development may proceed in that country.

 In April 2014, the Clinical
Trials Regulation, Reg. (EU) No 536/2014 (the " New Regulation ") was adopted to replace the Clinical Trials
Directive 2001/20/EC (the " Prior Directive "). To ensure that the rules for clinical trials are identical throughout
the EU/EEA, new EU clinical trials legislation was passed as a "regulation" that is directly applicable to EU/EEA member
states. The New Regulation requires the sponsor to submit a single CTA is planned for all EU/EEA member states, which will be submitted
via the CTIS, an online portal to streamline the authorization process. The CTIS authorization procedure is composed of two parts: member
states jointly cooperate in a Part I assessment, while Part II is assessed by each member state individually. This is a significant change,
as under the Prior Directive sponsors had to seek separate approval from national authorities in each country where the trial was to
be conducted. The New Regulation became applicable on January 31, 2022 - repealing the Prior Directive as of the same day - and introduced
a one-year transition period (until January 31, 2023) during which sponsors could choose whether to submit new CTAs under either
the old regime governed by the Prior Directive or the new CTIS. Following the transition period, from January 31, 2023, sponsors must
apply for clinical trials under the New Regulation, and by January 31, 2025, all ongoing clinical trials approved under the Prior Directive
will need to be transitioned to the New Regulation.

 In the U.K., the Prior Directive
(implemented by Medicines for Human Use (Clinical Trials) Regulations 2004/1031) still applies. On January 31, 2020, the U.K.
left the EU and the European Union (Withdrawal) Act 2018 (the " EUWA ") came into force. Section 1 of the
EUWA repealed the European Communities Act 1972 (ECA 1972), which had previously enabled EU law to apply to the U.K. However, Section
1A of the EUWA immediately saved much of the effect of ECA 1972 (in modified form) for the duration of the transition period, and
Section 1B saved U.K. legislation that implemented EU requirements. The practical effect of the EUWA was therefore that the New Regulation,
which had not yet become applicable was repealed for the U.K., but the Prior Directive was retained. References to the U.K. in this section
predominantly refer to Great Britain. Due to the Northern Ireland Protocol at Article 182 of the EUWA certain EU/EEA derived regulatory
standards in Northern Ireland were not repealed and therefore in some circumstances still apply. The Northern Ireland Protocol was replaced
with the Windsor Framework in 2023. In the U.K., approval must be obtained from the MHRA when a clinical trial is planned. A CTA must
be submitted and supported by an investigational medicinal product dossier along with additional supporting information pursuant to the
Medicines for Human Use (Clinical Trials) Regulations 2004/1031 and other applicable guidance documents provided by the MHRA. Furthermore,
a clinical trial may only commence after a competent ethics committee has issued a favorable opinion on the clinical trial application
in the U.K.

 The requirements and process
governing the conduct of clinical trials, product licensing, pricing and reimbursement vary from country to country, even though there
is already some degree of legal harmonization in the EU member states resulting from the national implementation of underlying EU legislation.
In all cases, the clinical trials must be conducted in accordance with the International Conference on Harmonization guidelines on GCP
and other applicable regulatory requirements.

 To obtain regulatory approval
to place a drug on the market in the U.K. or EU/EEA countries, we must submit a marketing authorization application. This application
is similar to the NDA in the U.S., with the exception of, among other things, country-specific document requirements. All application
procedures require an application in the common technical document, format, which includes the submission of detailed information about
the manufacturing and quality of the product, and nonclinical and clinical trial information. In addition to using national authorization
procedures (leading to a marketing authorization on valid in the relevant EU/EEA member state), drugs can be authorized in the EU/EEA
by using (i) the centralized authorization procedure, (ii) the mutual recognition procedure, or (iii) the decentralized
procedure. These three authorization methods available to the EU/EEA are no longer available to the U.K. Drugs can be authorized in the
U.K. by the MHRA by using (i) the Innovative Licensing and Access Pathway, (ii) the 150-day assessment route, (iii) a
"rolling review" route of evaluation for novel products and biotechnological products, (iv) a European Commission (EC) Decision
reliance procedure, (v) a decentralized and mutual recognition reliance procedure, or (vi) an "unfettered access"
route for marketing authorization applications approved in Northern Ireland.

 The European Commission created
the centralized procedure for the approval of human drugs to facilitate marketing authorizations that are valid throughout the EU and,
by extension (after national implementing decisions) in Iceland, Liechtenstein and Norway, which, together with the EU member states,
comprise the European Economic Area. Applicants file marketing authorization applications with the European Medicines Agency (EMA), where
they are reviewed by a relevant scientific committee, in most cases the Committee for Medicinal Products for Human Use (" CHMP ").
The European Medicines Agency (" EMA ") forwards CHMP opinions to the European Commission, which uses them as the
basis for deciding whether to grant a marketing authorization. This procedure results in a single marketing authorization granted by
the European Commission that is valid across the EU, as well as in Iceland, Liechtenstein and Norway. The centralized procedure is compulsory
for human drugs that are: (i) derived from biotechnology processes, such as genetic engineering, (ii) contain a new active
substance indicated for the treatment of certain diseases, such as HIV/AIDS, cancer, diabetes, neurodegenerative diseases, autoimmune
and other immune dysfunctions and viral diseases, (iii) officially designated " orphan drugs " (drugs used for
rare human diseases) and (iv) advanced-therapy medicines, such as gene-therapy, somatic cell-therapy or tissue-engineered medicines.
The centralized procedure may at the voluntary request of the applicant also be used for human drugs that do not fall within the above-mentioned
categories if the CHMP agrees that the human drug (a) contains a new active substance not yet approved on November 20, 2004; (b) constitutes
a significant therapeutic, scientific or technical innovation or (c) authorization under the centralized procedure is in the interests
of patients at the EU level. Although the U.K. can no longer utilize the EU centralized procedure, until December 31, 2023, the MHRA
can utilize the decentralized and mutual recognition reliance procedure to authorize drugs by relying upon EC approvals under the EU
centralized procedure. Beyond December 31, 2023, the MHRA intends to have a new regime for an international drug reliance framework.

 Under the centralized procedure
in the EU, the maximum time frame for the evaluation of a marketing authorization application by the EMA is 210 days (excluding clock
stops, when additional written or oral information is to be provided by the applicant in response to questions asked by the CHMP), with
adoption of the actual marketing authorization by the European Commission thereafter.

 Accelerated evaluation might
be granted by the CHMP in exceptional cases, when a medicinal product is expected to be of a major public health interest from the point
of view of therapeutic innovation, defined by three cumulative criteria: the seriousness of the disease to be treated; the absence of
an appropriate alternative therapeutic approach, and anticipation of exceptional high therapeutic benefit. In this circumstance, EMA
ensures that the evaluation for the opinion of the CHMP is completed within 150 days and the opinion issued thereafter.

 For those medicinal products
for which the centralized procedure is not available, the applicant must submit marketing authorization applications to the national
medicines regulators through one of three procedures: (i) the mutual recognition procedure (which must be used if the product has
already been authorized in at least one other EU/EEA member state, and in which the EU/EEA member states are required to grant an authorization
recognizing the existing authorization in the other EU/EEA member state, unless they identify a serious risk to public health), (ii) the
decentralized procedure (in which applications are submitted simultaneously in two or more EU/EEA member states) or (iii) national
authorization procedures (which results in a marketing authorization in a single EU/EEA member state).

 Conditional Marketing
Authorization

 The European Commission may
grant a conditional marketing authorization to medicines that address unmet medical needs. This marketing authorization is "conditional"
upon carrying out certain activities imposed when authorization is granted (e.g., completing ongoing or new studies or collecting additional
data). This applies when the applicant is unable to provide comprehensive data on the efficacy and safety of the medicinal product under
normal conditions of use, for objective, verifiable reasons and based on specific grounds, and all of the following criteria are met:

 the benefit-risk balance of the medicine is positive;

 it is likely that the applicant will be able to provide comprehensive data post-authorization;

 the medicine fulfils an unmet medical need; and

 the benefit of the medicine's immediate availability to patients is greater
 than the risk inherent in the fact that additional data is still required.

 Conditional marketing authorizations
are valid for one year and can be renewed annually.

 In Great Britain (England,
Scotland, Wales) the MHRA has introduced and regulates a national conditional marketing authorization, effective from January 1,
2021; in Northern Ireland, applications for conditional marketing authorization must be submitted to the EMA. The U.K. scheme has the
same eligibility criteria as the EU scheme.

 Mutual Recognition Procedure

 The mutual recognition procedure
(" MRP "), for the approval of human drugs is an alternative approach to facilitate individual national marketing authorizations
within the EU/EEA. Basically, the MRP may be applied for all human drugs for which the centralized procedure is not obligatory. The MRP
is applicable to the majority of conventional medicinal products and must be used if the product has already been authorized in one or
more member states.

 The characteristic of the
MRP is that the procedure builds on an already-existing marketing authorization in a member state that is used as a reference in order
to obtain marketing authorizations in other EU/EEA member states. In the MRP, a marketing authorization for a drug already exists in
one or more member states of the EU/EEA and subsequently marketing authorization applications are made in other member states by referring
to the initial marketing authorization. The member state in which the marketing authorization was first granted will then act as the
reference member state. The member states where the marketing authorization is subsequently applied for act as concerned member states.
The concerned member states are required to grant an authorization recognizing the existing authorization in the reference member state,
unless they identify a serious risk to public health.

 The MRP is based on the principle
of the mutual recognition by EU/EEA member states of their respective national marketing authorizations. Based on a marketing authorization
in the reference member state, the applicant may apply for marketing authorizations in other member states. In such case, the reference
member state is required to update its existing assessment report about the drug in 90 days. After the assessment is completed, copies
of the report are sent to all concerned member states, together with the approved summary of product characteristics, labeling and package
leaflet. The concerned member states then have 90 days to recognize the decision of the reference member state and the summary of product
characteristics, labeling and package leaflet. National marketing authorizations shall be granted within 30 days after acknowledgment
of the agreement.

 Should any member state refuse
to recognize the marketing authorization by the reference member state, on the grounds of potential serious risk to public health, the
issue will be referred to a coordination group. Within a timeframe of 60 days, member states shall, within the coordination group, make
all efforts to reach a consensus. If this fails, the procedure is submitted to an EMA scientific committee for arbitration. The opinion
of this EMA Committee is then forwarded to the European Commission, for the start of the decision-making process. As in the centralized
procedure, this process entails consulting various European Commission Directorates General and the Standing Committee on Human Medicinal
Products.

 Data Exclusivity

 In the U.K. and EU, marketing
authorization applications for generic medicinal products do not need to include the results of pre-clinical and clinical trials, but
instead can refer to the data included in the marketing authorization of a reference product for which regulatory data exclusivity has
expired. If a marketing authorization is granted for a medicinal product containing a new active substance, that product benefits from
eight years of data exclusivity, during which generic marketing authorization applications referring to the data of that product may
not be accepted by the regulatory authorities, and a further two years of market exclusivity, during which such generic products may
not be placed on the market. The two-year period may be extended to three years if during the first eight years a new therapeutic indication
with significant clinical benefit over existing therapies is approved.

 Orphan Medicinal Products

 The EMA's Committee
for Orphan Medicinal Products (" COMP "), may recommend orphan medicinal product designation to promote the development
of products that are intended for the diagnosis, prevention or treatment of life-threatening or chronically debilitating conditions affecting
not more than five in 10,000 persons in the EU. Additionally, orphan designation is granted for products intended for the diagnosis,
prevention or treatment of a life-threatening, seriously debilitating or serious and chronic condition and when, without incentives,
it is unlikely that sales of the product in the EU would be sufficient to justify the necessary investment in developing the medicinal
product. The COMP may only recommend orphan medicinal product designation when the product in question offers a significant clinical
benefit over existing approved products for the relevant indication. Following a positive opinion by the COMP, the European Commission
generally grants orphan status within 30 days. When the draft decision of the European Commission is not aligned with the COMP opinion,
the COMP will reassess orphan status in parallel with EMA review of a marketing authorization application and orphan status may be withdrawn
if the drug no longer fulfills the orphan criteria (for instance, because a new product was approved for the indication and no data is
available to demonstrate a significant benefit over that new product). Orphan medicinal product designation entitles a party to financial
incentives such as reduction of fees or fee waivers and ten years of market exclusivity is granted following marketing authorization.
During this period, the competent authorities may not accept or approve any similar medicinal product for the same therapeutic indication,
unless it offers a significant clinical benefit or if the holder of the marketing authorization for the original orphan drug is unable
to supply sufficient quantities of the drug. This period may be reduced to six years if the orphan medicinal product designation criteria
are no longer met, including where it is shown that the product is sufficiently profitable not to justify maintenance of market exclusivity.

 EU/EEA orphan designations
extend to Northern Ireland. Otherwise in the U.K. post-Brexit, applications for the designation of orphan medicinal products are submitted
to the MHRA, which applies the same substantive criteria and with the same substantive effect as in the EU (save that, unlike the EU
procedure, it is not possible to obtain early orphan designation; the application for designation must be made at the same time as the
application for the U.K. marketing authorization). If a medicinal product has been designated orphan in the EU, then a Great Britain
orphan marketing authorization application can be made to the MHRA; absent an EU orphan designation a U.K.-wide (including Northern Ireland) orphan
marketing authorization application can be made to the MHRA.

 Pediatric Development

 In the EU and the U.K., companies
developing a new medicinal product must agree to a Pediatric Investigation Plan (" PIP "), with the EMA or the MHRA
and must conduct pediatric clinical trials in accordance with that PIP unless a waiver applies, for example, because the relevant disease
or condition occurs only in adults. The marketing authorization application for the product must include the results of pediatric clinical
trials conducted in accordance with the PIP, unless a waiver applies, or a deferral has been granted, in which case the pediatric clinical
trials must be completed at a later date. Products that are granted a marketing authorization on the basis of the pediatric clinical
trials conducted in accordance with the PIP are eligible for a six-month extension of the protection under a supplementary protection
certificate (if the product covered by it qualifies for one at the time of approval). This pediatric reward is subject to specific conditions
and is not automatically available when data in compliance with the PIP is developed and submitted.

 If we fail to comply with
applicable foreign regulatory requirements, we may be subject to, among other things, fines, suspension of clinical trials, suspension
or withdrawal of regulatory approvals, product recalls, seizure of products, operating restrictions and criminal prosecution.

 In addition, most countries
are parties to the Single Convention on Narcotic Drugs 1961 and the Convention on Psychotropic Substances 1971, which governs international
trade and domestic control of narcotic substances, including cannabis extracts. Countries may interpret and implement their treaty obligations
in a way that creates a legal obstacle to our obtaining marketing approval for our product candidates in those countries. These countries
may not be willing or able to amend or otherwise modify their laws and regulations to permit our product candidates to be marketed, or
achieving such amendments to the laws and regulations may take a prolonged period of time. In that case, we would be unable to market
our products in those countries in the near future or perhaps at all.

 Reimbursement

 Sales of pharmaceutical products
in the U.S. will depend, in part, on the extent to which the costs of the products will be covered by third-party payers, such as government
health programs, and commercial insurance and managed health care organizations. These third-party payers are increasingly challenging
the prices charged for medical products and services. Additionally, the containment of health care costs has become a priority of federal
and state governments, and the prices of drugs have been a focus in this effort. The U.S. government, state legislatures and foreign
governments have shown significant interest in implementing cost-containment programs, including price controls, utilization management
and requirements for substitution of generic products. Adoption of price controls and cost-containment measures, and adoption of more
restrictive policies in jurisdictions with existing controls and measures, could further limit our net revenue and results. If these
third-party payers do not consider our future products to be cost effective compared to other available therapies, they may not cover
our products after approval as a benefit under their plans or, if they do, the level of payment may not be sufficient to allow us to
sell our products on a profitable basis.

 The Medicare Prescription
Drug, Improvement, and Modernization Act of 2003 (" MMA "), imposed requirements for the distribution and pricing of
prescription drugs for Medicare beneficiaries and included a major expansion of the prescription drug benefit under Medicare Part D.
Under Part D, Medicare beneficiaries may enroll in prescription drug plans offered by private entities that provide coverage of outpatient
prescription drugs. Part D is available through both stand-alone prescription drug benefit plans and prescription drug coverage as a
supplement to Medicare Advantage plans. Unlike Medicare Parts A and B, Part D coverage is not standardized. Part D prescription drug
plan sponsors are not required to pay for all covered Part D drugs, and each drug plan can develop its own drug formulary that identifies
which drugs it will cover and at what tier or level. However, Part D prescription drug formularies must include drugs within each therapeutic
category and class of covered Part D drugs, though not necessarily all the drugs in each category or class. Any formulary used by a Part
D prescription drug plan must be developed and reviewed by a pharmacy and therapeutic committee. Government payment for some of the costs
of prescription drugs may increase demand for products for which we receive marketing approval. However, any negotiated prices for our
products covered by a Part D prescription drug plan will likely be lower than the prices we might otherwise obtain. Moreover, while the
MMA applies only to drug benefits for Medicare beneficiaries, private payers often follow Medicare coverage policy and payment limitations
in setting their own payment rates. Any reduction in payment that results from the MMA may result in a similar reduction in payments
from nongovernmental payers.

 On February 17, 2009, President
Obama signed into law The American Recovery and Reinvestment Act of 2009. This law provides funding for the federal government to compare
the effectiveness of different treatments for the same illness. This research is overseen by the Department of Health and Human Services,
the Agency for Healthcare Research and Quality and the National Institutes for Health, and periodic reports on the status of the research
and related expenditures must be made to Congress. Although the results of the comparative effectiveness studies are not intended to
mandate coverage policies for public or private payers, it is not clear how such a result could be avoided and what if any effect the
research will have on the sales of our product candidates, if any such product or the condition that it is intended to treat is the subject
of a study. It is also possible that comparative effectiveness research demonstrating benefits in a competitor's product could
adversely affect the sales of our product candidates. Decreases in third-party reimbursement for our product candidates or a decision
by a third-party payer to not cover our product candidates could reduce physician usage of the product candidate and have a material
adverse effect on our sales, results of operations and financial condition.

 The Patient Protection and
Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act of 2010 (collectively, the " ACA ") was
enacted in March 2010. The ACA was enacted with the goal of expanding coverage for the uninsured while at the same time containing overall
health care costs. With regard to pharmaceutical products, among other things, the ACA expanded and increased industry rebates for drugs
covered under Medicaid programs and made changes to the coverage requirements under the Medicare D program. We still cannot fully predict
the impact of the ACA on pharmaceutical companies as many of the ACA reforms require the promulgation of detailed regulations implementing
the statutory provisions which has not yet been completed, and the Centers for Medicare & Medicaid Services have publicly announced
that it is analyzing the ACA regulations and policies that have been issued to determine if changes should be made. In addition, although
the U.S. Supreme Court has upheld the constitutionality of most of the ACA, some states have stated their intentions to not implement
certain sections of the ACA and some members of Congress are still working to repeal the ACA. These challenges add to the uncertainty
of the changes enacted as part of the ACA. In addition, the current legal challenges to the ACA, as well as Congressional efforts to
repeal the ACA, add to the uncertainty of the legislative changes enacted as part of the ACA.

 In addition, in some foreign
countries, the proposed pricing for a drug must be approved before it may be lawfully marketed. The requirements governing drug pricing
vary widely from country to country. For example, some EU jurisdictions operate positive and negative list systems under which products
may only be marketed once a reimbursement price has been agreed. To obtain reimbursement or pricing approval, some of these countries
may require the completion of clinical trials that compare the cost-effectiveness of a particular product candidate to currently available
therapies. Other member states allow companies to fix their own prices for medicines but monitor and control company profits. Such differences
in national pricing regimes may create price differentials between EU member states. There can be no assurance that any country that
has price controls or reimbursement limitations for pharmaceutical products will allow favorable reimbursement and pricing arrangements
for any of our products. Historically, products launched in the EU do not follow price structures of the U.S. In the EU, the downward
pressure on healthcare costs in general, particularly prescription medicines, has become intense. As a result, barriers to entry of new
products are becoming increasingly high and patients are unlikely to use a drug product that is not reimbursed by their government or
other public or private payers.

 Other Health Care Laws
and Compliance Requirements

 In the U.S., our activities
are potentially subject to regulation by various federal, state and local authorities in addition to the FDA, including the CMS, other
divisions of the U.S. Department of Health and Human Services (e.g., the Office of Inspector General), the U.S. Department of Justice
and individual U.S. Attorney offices within the Department of Justice, and state and local governments. For example, sales, marketing
and scientific/educational grant programs must comply with the anti-fraud and abuse provisions of the Social Security Act, the False
Claims Act, the privacy provisions of the Health Insurance Portability and Accountability Act, and similar state laws, each as amended.
Pricing and rebate programs must comply with the Medicaid rebate requirements of the Omnibus Budget Reconciliation Act of 1990 and the
Veterans Health Care Act of 1992 (" VHCA "), each as amended. If future products are made available to authorized users
of the federal supply schedule, additional laws and requirements apply. Under the VHCA, drug companies are required to offer certain
drugs at a reduced price to a number of federal agencies including the U.S. Department of Veteran Affairs and U.S. Department of Defense,
the Public Health Service and certain private Public Health Service-designated entities in order to participate in other federal funding
programs including Medicare and Medicaid. In addition, discounted prices must be offered for certain U.S. Department of Defense purchases
for its TRICARE program via a rebate system. Participation under the VHCA requires submission of pricing data and calculation of discounts
and rebates pursuant to complex statutory formulas, as well as the entry into government procurement contracts governed by the federal
acquisition regulations.

 In order to distribute products
commercially, we must comply with state laws that require the registration of manufacturers and wholesale distributors of pharmaceutical
products in a state, including, in certain states, manufacturers and distributors who ship products into the state, even if such manufacturers
or distributors have no place of business within the state. Several states have enacted legislation requiring pharmaceutical companies
to establish marketing compliance programs, file periodic reports with the state, make periodic public disclosures on sales and marketing
activities or register their sales representatives. Other legislation has been enacted in certain states prohibiting certain other sales
and marketing practices. All of our activities are potentially subject to federal and state consumer protection and unfair competition
laws. Likewise, these activities are subject to authorization or license requirements, or other legal requirements, under EU or EU member
states' law, or the law of other countries where we operate or have products manufactured or distributed.

 Cost of Compliance with Environmental Laws

 Our operations are subject
to regulations under various federal, state, local and foreign laws concerning the environment, including laws addressing the discharge
of pollutants into the air and water, the management and disposal of hazardous substances and wastes, and the cleanup of contaminated
sites. We could incur substantial costs, including cleanup costs, fines and civil or criminal sanctions and third-party damage or personal
injury claims, if in the future we were to violate or become liable under environmental laws. We are not aware of any costs or effects
of our compliance with environmental laws.

 Climate Change Related Regulation

 Our operations are focused
on research and development of pharmaceutical products, and a significant portion of such research and development is conducted outside
of our facilities and by outsourced contract research organizations or universities. As a result, we do not anticipate any regulation
surrounding climate change to impact our operations.

 However, there is potential
for more frequent and severe weather events and water availability challenges that may impact the facilities of our partners and our
future suppliers. We cannot provide assurance that physical risks to the facilities of our partners and future suppliers and supply chain
due to climate change will not occur in the future. We periodically review our vulnerability to potential weather-related risks and other
natural disasters and update our assessments accordingly. Based on our reviews, we do not believe these potential risks are material
to our operations at this time.

 Employees and Human Capital Management

 As of March 20, 2024, we and
our subsidiaries had four full-time employees. One of these employees is located in the U.K., and three are located in the U.S.

 In addition, we employ a
limited number of part-time employees on a temporary basis, as well as scientific advisors, consultants and service providers, mainly
through academic institutions and contract research organizations.

 We have never had a work
stoppage and none of our employees are covered by collective bargaining agreements or represented by a labor union. We believe that we
have good relationships with our employees.

 Our human capital resources
objectives include, as applicable, identifying, recruiting, retaining, incentivizing, and integrating our existing and new employees,
advisors, and consultants. The principal purposes of our equity and cash incentive plans are to attract, retain and reward personnel
through the granting of stock-based and cash-based compensation awards, in order to increase stockholder value and the success of our
company by motivating such individuals to perform to the best of their abilities and achieve our objectives.

 Corporate History

 Formation

 We were formed as a blank
check company organized under the laws of the State of Delaware on September 7, 2016. We were formed for the purpose of effecting a merger,
capital stock exchange, stock purchase, asset acquisition or other similar business combination with one or more operating businesses.
Since formation, we focused our efforts on acquiring an operating company in the healthcare and related wellness industry although our
efforts in identifying a prospective target business were not limited to a particular industry.

 Initial Public Offering

 On June 7, 2017, pursuant to our Initial Public Offering (the " IPO "),
we sold 11,500,000 Units at a purchase price of $10.00 per Unit, inclusive of 1,500,000 Units sold to the underwriters on June 23, 2017
upon the underwriters' election to fully exercise their over-allotment option, generating gross proceeds of $115,000,000. Each " Unit "
consisted of one-380th of a share of our common stock, one right to receive one-3,800th of one share of our common stock upon the consummation
of a business combination (" Right "), and one redeemable warrant to purchase one-seven hundred sixtieth of one share
of our common stock (the " Public Warrants "). Each Public Warrant entitles the holder to purchase one- seven hundred
sixtieth of one share of common stock at an exercise price of $5.75 per 1/760 th of one share ($4,370.00 per whole share),
subject to adjustment. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants became exercisable
12 months from the closing of the IPO, and expire five years after the completion of the Business Combination (November 6, 2025).

 We may redeem the Public Warrants,
in whole and not in part, at a price of $0.01 per Public Warrant upon 30 days' notice (" 30-day redemption period "),
only in the event that the last sale price of the common stock equals or exceeds $6,840.00 per share for any 20 trading days within a
30-trading day period ending on the third trading day prior to the date on which notice of redemption is given, provided there is an effective
registration statement with respect to the shares of common stock underlying such Public Warrants and a current prospectus relating to
those shares of common stock is available throughout the 30-day redemption period. If we call the Public Warrants for redemption as described
above, our management will have the option to require all holders that wish to exercise Public Warrants to do so on a " cashless
basis. " In determining whether to require all holders to exercise their Public Warrants on a " cashless basis, "
management will consider, among other factors, our cash position, the number of Public Warrants that are outstanding and the dilutive
effect on our stockholders of issuing the maximum number of shares of common stock issuable upon the exercise of the Public Warrants.
Each holder of a Right received one-3,800th (1/3,800) of one share of common stock upon consummation of the Business Combination.
No fractional shares were issued upon exchange of the Rights.

 Private Placement

 Concurrent with the closing
of the IPO, KBL IV Sponsor LLC (the " Sponsor ") and the underwriters purchased an aggregate of 450,000 unregistered
Units (" Private Units ") at $10.00 per Unit, generating gross proceeds of $4,500,000 in a private placement. In
addition, on June 23, 2017, we consummated the sale of an additional 52,500 Private Units at a price of $10.00 per Unit, which were purchased
by the Sponsor and underwriters, generating gross proceeds of $525,000. Of these, 377,500 Private Units were purchased by the Sponsor
and 125,000 Private Units were purchased by the underwriters. The proceeds from the Private Units were added to the net proceeds from
the IPO held in a Trust Account (the " Trust Account "). The Private Units (including their component securities) were
not transferable, assignable or salable until 30 days after the completion of the Business Combination (defined below) and the warrants
included in the Private Units (the " Private Placement Warrants ") will be non-redeemable so long as they are held
by the Sponsor, the underwriters or their permitted transferees. If the Private Placement Warrants are held by someone other than the
Sponsor, the underwriters or their permitted transferees, the Private Placement Warrants will be redeemable by us and exercisable by
such holders on the same basis as the warrants included in the Units sold in the IPO. In addition, for as long as the Private Placement
Warrants are held by the underwriters or its designees or affiliates, they may not be exercised after five years from the effective date
of the registration statement related to the IPO. Otherwise, the Private Placement Warrants have terms and provisions that are identical
to those of the warrants sold as part of the Units in the IPO and have no net cash settlement provisions.

 Business Combination

 On July 25, 2019, we entered
into a Business Combination Agreement (as amended from time to time, the " Business Combination Agreement "), with KBL
Merger Sub, Inc. (" Merger Sub "), 180 Life Corp. (f/k/a 180 Life Sciences Corp.) (" 180 "), Katexco
Pharmaceuticals Corp. (" Katexco "), CannBioRex Pharmaceuticals Corp. (" CBR Pharma "), 180 Therapeutics
L.P. (" 180 LP " and together with Katexco and CBR Pharma, the " 180 Subsidiaries " and, together with
180 Life Sciences Corp., the " 180 Parties "), and Lawrence Pemble, in his capacity as representative of the stockholders
of the 180 Parties (the " Stockholder Representative "). The business combination described in the Business Combination
Agreement (the " Business Combination "), closed and became effective on November 6, 2020 (the " Closing ").
Pursuant to the Business Combination Agreement, among other things, Merger Sub merged with and into 180, with 180 continuing as the surviving
entity and a wholly-owned subsidiary of the Company (the " Merger "). In connection with, and prior to, the Closing,
180 Life Sciences Corp. filed a Certificate of Amendment of its Certificate of Incorporation in Delaware to change its name to 180 Life
Corp., and our company (which was known as of our entry into the Business Combination as KBL Merger Corp. IV, changed our name to 180
Life Sciences Corp.).

 180 was incorporated in Delaware
on January 28, 2019. Prior to the Closing of the Business Combination, 180 operated through three subsidiaries: 180 LP, a Delaware limited
partnership formed on September 6, 2013; Katexco, a company incorporated in British Columbia, Canada on March 7, 2018; and CBR Pharma,
a company incorporated in British Columbia, Canada on March 8, 2018.

 In July 2019, 180 and each
of 180 LP, Katexco and CBR Pharma completed a corporate restructuring, pursuant to which 180 LP, Katexco and CBR Pharma became wholly-owned
subsidiaries of 180LS (the " Reorganization "). The corporate restructuring arrangements with respect to Katexco and
CBR Pharma were completed under the Business Corporations Act (British Columbia).

 On November 6, 2020 (the
" Closing Date "), we consummated the Business Combination following a special meeting of stockholders held on November
5, 2020, where the stockholders of the Company considered and approved, among other matters, a proposal to adopt the Business Combination.
Pursuant to the Business Combination Agreement, among other things, Merger Sub merged with and into 180, with 180 continuing as the surviving
entity and as a wholly-owned subsidiary of the Company. The Merger became effective on November 6, 2020 (such time, the " Effective
Time ", and the closing of the Merger being referred to herein as the " Closing "). In connection with, and
prior to, the Closing, 180 filed a Certificate of Amendment of its Certificate of Incorporation in Delaware to change its name to 180
Life Corp. and KBL Merger Corp. IV changed its name to 180 Life Sciences Corp.

 At the Effective Time, each
share of 180 common stock issued and outstanding prior to the Effective Time was automatically converted into the right to receive approximately
0.44310 shares of the common stock, par value $0.0001 per share, of the Company (such shares of common stock issuable to the common stockholders
of 180 pursuant to the Business Combination Agreement, the " Merger Consideration Shares "). An aggregate of 46,039
shares of common stock have been issued to date to the common stockholders of 180 as Merger Consideration Shares, including the Escrow
Shares (as defined below). Also at the Effective Time, each share underlying the 180 preferred stock issued and outstanding prior to
the Effective Time was converted into the right to receive one Class C Special Voting Share of the Company, or one Class K Special Voting
Share of the Company, as applicable (such shares, the " Special Voting Shares "). The Special Voting Shares entitle
the holder thereof to an aggregate number of votes, on any particular matter, proposition or question, equal to the number of Exchangeable
Shares (as defined below) of each of CannBioRex Purchaseco ULC and Katexco Purchaseco ULC, Canadian subsidiaries of 180, respectively,
that are outstanding from time to time.

 As a result of the Merger,
the existing exchangeable shares (collectively, the " Exchangeable Shares ") of CannBioRex Purchaseco ULC and/or
Katexco Purchaseco ULC were adjusted in accordance with the share provisions in the articles of CannBioRex Purchaseco ULC or Katexco
Purchaseco ULC, as applicable, governing the Exchangeable Shares such that they were multiplied by the exchange ratio for the Merger
and became exchangeable into shares of common stock. The Exchangeable Shares entitle the holders to dividends and other rights that are
substantially economically equivalent to those of holders of common stock, and holders of Exchangeable Shares have the right to vote
at meetings of the stockholders of the Company. An aggregate of 14 shares of common stock are reserved for issuance to the holders of
the Exchangeable Shares upon the exchange thereof.

 Pursuant to the Business Combination
Agreement, 2,764 of the Merger Consideration Shares (such shares, the " Escrow Shares ") were deposited into an
escrow account (the " Escrow Account ") to serve as security for, and the exclusive source of payment of, our indemnity
rights under the Business Combination Agreement, all of which were planned to be released to the same stockholders 12 months following
the Closing of the Business Combination, but for a claim made by Dr. Krauss against these shares which is pending.

 As a result of the Business
Combination, the former stockholders of 180 became the controlling stockholders of the Company and 180 became a wholly-owned subsidiary
of the Company. The Business Combination was accounted for as a reverse merger, whereby 180 is considered the acquirer for accounting
and financial reporting purposes.

 In connection with the Closing,
we withdrew $9,006,493 of funds from the Trust Account (as defined below) to fund the redemptions of 2,149 shares.

 Reverse Stock Splits

 December 2022 Reverse Stock Split

 On December 15, 2022, at a
Special Meeting of the Stockholders of 180 Life Sciences Corp., our stockholders approved an amendment to our Certificate of Incorporation
to effect a reverse stock split of our issued and outstanding shares of our common stock, par value $0.0001 per share, by a ratio of between
one-for-four to one-for-twenty, inclusive, with the exact ratio to be set at a whole number to be determined by our Board or a duly authorized
committee thereof in its discretion, at any time after approval of the amendment and prior to December 15, 2023. On December 15, 2022,
our Board, with the Stockholder Authority, approved an amendment to our Second Amended and Restated Certificate of Incorporation to affect
a reverse stock split of our common stock at a ratio of 1-for-20.

 Immediately after the Special
Meeting and the approval thereof by the Board, on December 15, 2022, we filed a Certificate of Amendment to our Second Amended and Restated
Certificate of Incorporation with the Secretary of State of the State of Delaware to effect the Reverse Stock Split.

 Pursuant to the Certificate
of Amendment, the Reverse Stock Split became effective on December 19, 2022 at 12:01 a.m. Eastern Time. No change was made to the trading
symbol for our shares of common stock or public warrants, "ATNF" and "ATNFW", respectively, in connection with
the Reverse Stock Split.

 The Certificate of Amendment
did not reduce the number of authorized shares of our common stock, nor alter the par value of our common stock or modify any voting
rights or other terms of our common stock.

 No fractional shares were
issued in connection with the Reverse Stock Split and stockholders of record who otherwise would be entitled to receive fractional shares,
were instead entitled to have their fractional shares rounded up to the nearest whole share.

 February 2024 Reverse Stock Split

 On February 16, 2024, at
a Special Meeting of the Stockholders of the Company, our stockholders approved an amendment to our Second
Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares of
our common stock, par value $0.0001 per share, by a ratio of between one-for-four to one-for-forty, inclusive, with the exact ratio to
be set at a whole number to be determined by our Board of Directors.

 On
February 26, 2024, the Company's Board of Directors approved a one-for-19 reverse stock split of the Company's outstanding
common stock and the filing of a Certificate of Amendment to our Certificate of Incorporation to affect such reverse stock split, which
was filed on February 26, 2024. The Reverse Stock Split became effective on February 28, 2024 at 12:01 a.m. Eastern Time, with shares
beginning trading on a split-adjusted basis at market open on February 28, 2024. In connection with the Reverse Stock Split, every 19
shares of the Company's common stock issued and outstanding as of the Effective Time were automatically converted into one share
of the Company's common stock.

 In connection with the reverse split, all outstanding options, warrants,
and other securities entitling their holders to purchase or otherwise receive shares of common stock were adjusted as required by the
terms of each security. The number of shares available to be awarded under the Company's equity incentive plans were also appropriately
adjusted. Following the reverse split, the par value of the Common Stock remained unchanged at $0.0001 par value per share. The reverse
split did not change the authorized number of shares of common stock or preferred stock. No fractional shares were issued in connection
with the reverse split, and stockholders who would otherwise be entitled to receive a fractional share instead received one whole share
of common stock in lieu of such fractional share.

 The effects of the 1-for-19
Reverse Stock Split have been retroactively reflected throughout this Report.

 Corporate Structure

 The chart below shows our
current organizational structure:

 About Us

 Our principal executive offices
are located at 3000 El Camino Real, Bldg. 4, Suite 200, Palo Alto, CA 94306, and our telephone number is (650) 507-0669. We maintain
a website at www.180lifesciences.com. We have not incorporated by reference into this Report the information in, or that
can be accessed through, our website, and you should not consider it to be a part of this Report.

 Item 1A. Risk
Factors.

 Summary Risk Factors

 We face risks and uncertainties
related to our business, many of which are beyond our control. In particular, risks associated with our business include:

 we are a clinical stage biotechnology company that had no revenue for the years ended December 31, 2023 and 2022 and do not anticipate generating revenue for the near future;

 our need for additional financing, both near term and long term, to support our
 operations, our ability to raise such financing as needed, the terms of such financing, if available, potential significant dilution
 associated therewith, and covenants and restrictions we may need to comply with in connection with such funding;

 our dependence on the success of our future product candidates, some of which may
 not receive regulatory approval or be successfully commercialized; problems in our manufacturing process for our new products and/or
 our failure to comply with manufacturing regulations, or unexpected increases in our manufacturing costs; problems with distribution
 of our products; and failure to adequately market our products;

 risks associated with the growth of our business, our ability to maintain such growth,
 difficulties in managing our growth, and executing our growth strategy;

 liability for previously restated financial statements and associated with ineffective
 controls and procedures, as well as costs and expenses related to the indemnification of current and former officers and directors;

 our dependence on our key personnel and our ability to attract and retain employees and consultants;

 risks from intense competition from companies with greater resources and experience than we have;

 our ability to receive regulatory approvals for our product candidates, and the timeline and costs
 associated therewith, including the uncertainties associated with the clinical development and regulatory approval of our drug candidates,
 including potential delays in the enrollment and completion of clinical trials, issues raised by the FDA and the MHRA;

 risks that our future product candidates, if approved by regulatory authorities, may be unable to
 achieve the expected market acceptance and, consequently, limit our ability to generate revenue from new products;

 the outcome of currently pending and future claims and litigation, future government investigations,
 and other proceedings may adversely affect our business and results of operations;

 the fact that the majority of our license agreements provide the licensors and/or counter-parties
 the right to use, own and/or exploit such licensed intellectual property;

 preclinical studies and earlier clinical trials may not necessarily be predictive of future results
 and may not have favorable results; we have limited marketing experience, and our future ability to successfully commercialize any
 of our product candidates, even if they are approved in the future is unknown; and business interruptions could delay us in the process
 of developing our future product candidates and could disrupt our product sales;

 third-party payors may not provide coverage and adequate reimbursement levels for any future products;

 liability from lawsuits (including product liability lawsuits, stockholder lawsuits and regulatory
 matters), including judgments, damages, fines and penalties and including the outcome of currently pending litigation, potential
 future government investigations, and other proceedings that may adversely affect our business and results of operations;

 security breaches, loss of data and other disruptions which could prevent us from accessing critical
 information or expose us to liabilities or damages;

 risks associated with clinical trials that are expensive, time-consuming, uncertain and susceptible
 to change, delay or termination and which are open to differing interpretations, delays in the trials, testing, application, or approval
 process for drug candidates and/or our ability to obtain approval for promising drug candidates, and the costs associated therewith;

 our ability to comply with existing and future rules and regulations, including federal, state and
 foreign healthcare laws and regulations and implementation of, or changes to, such healthcare laws and regulations;

 our ability to adequately protect our future product candidates or our proprietary technology in
 the marketplace, claims and liability from third parties regarding our alleged infringement of their intellectual property;

 differences in laws and regulations between countries and other jurisdictions and changes in laws
 or regulations, including, but not limited to tax laws and controlled substance laws, or a failure to comply with any laws and regulations;

 conflicts of interest between our officers, directors, consultants and scientists;

 penalties associated with our failure to comply with certain pre-agreed contractual obligations and
 restrictions;

 dilution caused by future fund raising, the conversion/exercise of outstanding convertible securities,
 and downward pressure on the value of our securities caused by such future issuances/sales;

 negative effects on our business from the COVID-19 pandemic and other potential future pandemics;

 the extremely volatile nature of our securities and potential lack of liquidity thereof;

 the fact that our Certificate of Incorporation provides for indemnification of officers and directors,
 limits the liability of officers and directors, allows for the authorization of preferred stock without stockholder approval, and
 includes certain other anti-takeover provisions and exclusive forum provisions;

 our ability to maintain the listing of our common stock and warrants on Nasdaq and the costs of compliance
 with SEC and Nasdaq rules and requirements;

 failure of our information technology systems, including cybersecurity attacks or other data security
 incidents, that could significantly disrupt the operation of our business;

 the fact that we may acquire other companies which could divert our management's attention,
 result in additional dilution to our stockholders and otherwise disrupt our operations and harm our operating results and if we make
 any acquisitions, they may disrupt or have a negative impact on our business;

 the effect of changes in inflation and interest rates, and economic downturns, including potential
 recessions, as well as macroeconomic, geopolitical, health and industry trends, pandemics, acts of war (including the ongoing Ukraine/Russian
 and Hamas/Israel conflict) and other large-scale crises, as well as the potential implications of a Congressional impasse over the
 U.S. debt limit or possible future U.S. governmental shutdowns over budget disagreements;

 the fact that we do not currently have $2.5 million or more of stockholders'
equity, and as a result, we are not in compliance with the continued listing requirements of the Nasdaq Capital Market and our common
stock and public warrants are subject to delisting;

 the fact that we may apply working capital and future funding to uses that ultimately do not improve
 our operating results or increase the value of our securities; and

 our growth depends in part on the success of our strategic relationships with third parties.

 You should be aware
that there are substantial risks for an investment in our common stock. You should carefully consider these risk factors before you decide
to invest in our common stock.

 If any of the following
risks were to occur, our business, financial condition, results of operations or other prospects, could be materially adversely affected,
and the occurrence of any of these risks could materially affect our likelihood of success. If that happens, the market price of our
common stock, if any, could decline, and prospective investors would lose all or part of their investment in our common stock.

 Our business, financial condition
and results of operations are subject to various risks and uncertainties, including those described below. This section discusses factors
that, individually or in the aggregate, could cause our actual results to differ materially from expected and historical results. Our
business, financial condition or results of operations could be materially adversely affected by any of these risks. It is not possible
to predict or identify all such factors. Consequently, the following description of Risk Factors is not a complete discussion of all
potential risks or uncertainties applicable to our business.

 Risks Related to Our Business Operations

 Our current cash balance
is only expected to be sufficient to fund our planned business operations through approximately May 2024. If additional capital is not
available, we may not be able to pursue our planned business operations, may be forced to change our planned business operations, or
may take other actions that could adversely impact our stockholders, including seeking bankruptcy protection.

 We are a clinical stage biotechnology
company that currently has no revenue. Thus, our business does not generate the cash necessary to finance our planned business operations.
We will require significant additional capital to: (i) develop FDA and/or MHRA-approved products and commercialize such products;
(ii) fund research and development activities relating to, and obtain regulatory approval for, our product candidates; (iii) protect
our intellectual property; (iv) attract and retain highly-qualified personnel; (v) respond effectively to competitive pressures;
and (vi) acquire complementary businesses or technologies.

 Our future capital needs
depend on many factors, including: (i) the scope, duration and expenditures associated with our research, development and commercialization
efforts; (ii) continued scientific progress in our programs; (iii) the outcome of potential partnering or licensing transactions,
if any; (iv) competing technological developments; (v) our proprietary patent position; and (vi) the regulatory approval
process for our products.

 We will need to raise substantial
additional funds through public or private equity offerings, debt financings or strategic alliances and licensing arrangements to finance
our planned business operations. We may not be able to obtain additional financing on terms favorable to us, if at all. General market
conditions, rising interest rates and inflation, as well as global conflicts such as the ongoing conflict between Ukraine and Russia,
and Israel and Hamas, may make it difficult for us to seek financing from the capital markets, and the terms of any financing may adversely
affect the holdings or the rights of our stockholders. For example, if we raise additional funds by issuing equity securities, further
dilution to our stockholders will result, which may substantially dilute the value of their investment. Any equity financing may also
have the effect of reducing the conversion or exercise price of our outstanding convertible or exercisable securities, which could result
in the issuance (or potential issuance) of a significant number of additional shares of our common stock. In addition, as a condition
to providing additional funds to us, future investors may demand, and may be granted, rights superior to those of existing stockholders.
Debt financing, if available, may involve restrictive covenants that could limit our flexibility to conduct future business activities
and, in the event of insolvency, could be paid before holders of equity securities received any distribution of our assets. We may be
required to relinquish rights to our technologies or product candidates, or grant licenses through alliance, joint venture or agreements
on terms that are not favorable to us, in order to raise additional funds. If adequate funds are not available, we may have to delay,
reduce or eliminate one or more of our planned activities with respect to our business, or terminate our operations, or may be forced
to seek bankruptcy protection. These actions would likely reduce the market price of our common stock.

 We will need additional
capital which may not be available on commercially acceptable terms, if at all, which raises questions about our ability to continue
as a going concern.

 As
of December 31, 2023, we had an accumulated deficit of $127,343,657 and a working capital deficit of $1,422,710, and for the year ended
December 31, 2023, a net loss of $19,935,112 and cash used in operating activities for the year ended December 31, 2023, of $10,922,223.
As of March 18, 2024, we had cash on hand of approximately $0.8 million.
The accompanying Consolidated Financial Statements have been prepared assuming we will continue as a going concern. As we are not generating
revenues, we need to raise a significant amount of capital in order to pay our debts and cover our operating costs. While we recently
raised funds through the sale of equity in July 2022 (approximately $6.5 million of gross proceeds), December 2022 (approximately $6.0
million of gross proceeds), April 2023 (approximately $3.0 million of gross proceeds), August 2023 (approximately $3.0 million) and November
2023 (approximately $0.8 million), there is no assurance that we will be able to raise additional needed capital or that such capital
will be available under favorable terms.

 We are subject to all the
substantial risks inherent in the development of a new business enterprise within an extremely competitive industry. Due to the absence
of a long-standing operating history and the emerging nature of the markets in which we compete, we anticipate operating losses until
we can successfully implement our business strategy, which includes all associated revenue streams. We may never ever achieve profitable
operations or generate significant revenues.

 We currently have a monthly
cash requirement spend of approximately $350,000. We believe that in the aggregate, we will require significant additional capital funding
to support and expand the research and development and marketing of our products, fund future clinical trials, repay debt obligations,
provide capital expenditures for additional equipment and development costs, payment obligations, office space and systems for managing
the business, and cover other operating costs until our planned revenue streams from products are fully-implemented and begin to offset
our operating costs, if ever.

 Since our inception, we have
funded our operations with the proceeds from equity and debt financing. We have experienced liquidity issues due to, among other reasons,
our limited ability to raise adequate capital on acceptable terms. We have historically relied upon the sale of equity and debt funding
that is convertible into shares of our common stock to fund our operations and have devoted significant efforts to reduce that exposure.
We anticipate that we will need to issue equity to fund our operations and fund our operating expenses for the foreseeable future. If
we are unable to achieve operational profitability or we are not successful in securing other forms of financing, we will have to evaluate
alternative actions to reduce our operating expenses and conserve cash.

 These conditions raise substantial
doubt about our ability to continue as a going concern. The Consolidated Financial Statements included herein have been prepared in accordance
with accounting principles generally accepted in the United States on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. Accordingly, the Consolidated Financial Statements included herein
do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should
we be unable to continue as a going concern. The Consolidated Financial Statements included herein also include a going concern footnote.

 Additionally, wherever possible,
our board of directors (" Board of Directors " or " Board ") will attempt to use non-cash consideration
to satisfy obligations. In many instances, we believe that the non-cash consideration will consist of restricted shares of our common
stock, preferred stock or warrants to purchase shares of our common stock. Our Board has authority, without action or vote of the stockholders,
but subject to Nasdaq rules and regulations (which generally require stockholder approval for any transactions which would result in
the issuance of more than 20% of our then outstanding shares of common stock or voting rights representing over 20% of our then outstanding
shares of stock, subject to certain exceptions), to issue all or part of the authorized but unissued shares of common stock, preferred
stock or warrants to purchase such shares of common stock. In addition, we may attempt to raise capital by selling shares of our common
stock, possibly at a discount to market in the future. These actions will result in dilution of the ownership interests of existing stockholders,
may further dilute common stock book value, and that dilution may be material. Such issuances may also serve to enhance existing management's
ability to maintain control of us, because the shares may be issued to parties or entities committed to supporting existing management.

 We will need to raise
additional capital, which may not be available on favorable terms, if at all, causing dilution to our stockholders, restricting our operations
or adversely affecting our ability to operate our business.

 We may not be able to obtain
additional financing on terms favorable to us, if at all, including as a result of macroeconomic conditions such as a severe or prolonged
economic downturn. Disruption, uncertainty or volatility in the capital markets could increase our cost of capital or limit our ability
to raise funds needed to operate our business. Disruptions could be caused by Federal Reserve policies and actions, currency concerns,
inflation, economic downturn or uncertainty, monetary policies, failures of financial institutions, U.S. debt management concerns, and
U.S. debt limit and budget disputes, including government shutdowns, European and worldwide sovereign debt concerns, other global or
geopolitical events, or other factors. Current macroeconomic conditions have negatively impacted the U.S. banking sector, including for
example, the recent closures and FDIC receiverships of Silicon Valley Bank and Signature Bank. Although we do not have any accounts at
or business relationships with these banks, we may be negatively impacted by other disruptions to the U.S. banking system caused by these
or similar developments.

 We have significant
and increasing liquidity needs and require additional funding.

 Research and development,
management and administrative expenses, including legal expenses, and cash used for operations will continue to be significant and may
increase substantially in the future in connection with new research and development initiatives, clinical trials, continued product
commercialization efforts and the launch of our future product candidates. We will need to raise additional capital to fund our operations,
continue to conduct clinical trials to support potential regulatory approval of marketing applications, and to fund commercialization
of our future product candidates.

 The amount and timing of
our future funding requirements will depend on many factors, including, but not limited to:

 the timing of FDA and/or MHRA approval, if any, and approvals in other international
 markets of our future product candidates, if at all;

 the timing and amount of revenue from sales of our products, or revenue from grants or
 other sources;

 the rate of progress and cost of our clinical trials and other product development programs;

 costs of establishing or outsourcing sales, marketing and distribution capabilities;

 costs and timing of any outsourced growing and commercial manufacturing supply arrangements
 for our future product candidates;

 costs of filing, prosecuting, defending and enforcing any patent claims and other intellectual
 property rights associated with our future product candidates;

 the effect of competing technological and market developments;

 personnel, facilities and equipment requirements; and

 the terms and timing of any additional collaborative, licensing, co-promotion or other
 arrangements that we may establish.

 While we expect to fund our
future capital requirements from a number of sources, such as cash flow from operations and the proceeds from further public and/or private
offerings, we cannot assure you that any of these funding sources will be available to us on favorable terms, or at all. Further, even
if we can raise funds from all of the above sources, the amounts raised may not be sufficient to meet our future capital requirements.

 Our License Agreements
with the University of Oxford and other licensors may be terminated in certain circumstances without our consent.

 All of our License Agreements
with the University of Oxford and other licensors remain subject to various conditions and covenants, and provide for certain termination
rights to the licensors. Those agreements typically allow termination by the licensor for our failure to pay amounts due timely, our
failure to cure a material breach under the terms of the applicable license agreement, and our insolvency. As a result, if we are deemed
insolvent, or in the event we seek bankruptcy protection, the licensors of our license agreements may terminate their license agreements
with us. In the event such license agreements are terminated, we could lose the right to develop all of our platforms and technologies,
may lose any investments made towards developing such platforms and technologies, and may be left without any intellectual property,
product pathways, or development opportunities. Such terminations may result in the value of our securities declining in value or becoming
worthless, the need for us to change our business plan, and may result in the Company seeking bankruptcy protection.

 We owe a significant
amount of money to the University of Oxford, which funds we do not have. The university may take action against us to enforce their rights
to payment in the future, which could have a material adverse effect on us and our operations.

 Due to recent financial constraints,
the Company has been unable to timely pay amounts due to the University of Oxford (" Oxford "), the licensor of the
majority of the Company's licenses and patents and the Company's research partner. Oxford alleges that an aggregate of approximately
 929,030 is owed from the Company and one of its subsidiaries to Oxford under the terms of licenses and agreements with Oxford
and related parties. The Company is currently in ongoing discussions with Oxford to reduce that amount and enter into a payment plan
with regards to the amounts owed; however, no definitive terms or extensions have been agreed to date. Oxford has also notified the Company
that it is not willing to discuss any new projects or arrangements until all outstanding invoices have been paid or a payment plan has
been agreed to; has engaged a law firm to seek the collection of the amounts owed, together with interest; and has threatened legal proceedings
against us. While we are hopeful that we can come to mutually agreeable terms regarding a settlement, payment plan, and/or extension,
with Oxford, we may not have sufficient funds to pay amounts due to Oxford in the near term, if at all, and Oxford may take action against
us, including filing legal proceedings against us seeking amounts due and interest, attempting to terminate their relationship with us,
and/or filing a wind-up petition against one of the Company's subsidiaries in the U.K.. If Oxford were to take legal action against
us or terminate their relationship with us, we may be forced to scale back our business plan and/or seek bankruptcy protection. We may
be subject to litigation and damages for our failure to pay amounts due to Oxford, and may be forced to pay interest and penalties, which
funds we do not currently have. We plan to seek to raise funding in the future to support our operations, and to pay amounts due to Oxford,
through a combination of equity offerings, debt financing or other capital sources, including potentially collaborations, licenses and
other similar arrangements, which may not be available on favorable terms, if at all. The sale of additional equity or debt securities,
if accomplished, may result in dilution to our then stockholders. Additionally, in December 2023, we engaged A.G.P./Alliance Global Partners
as financial advisor to explore and evaluate strategic alternatives to enhance shareholder value. Potential strategic alternatives that
may be explored or evaluated by the Company as part of this process include, but are not limited to, an acquisition, merger, reverse
merger, other business combination, sale of assets, licensing or other strategic transactions involving the Company. The Company does
not intend to discuss or disclose further developments during this process unless and until its Board of Directors has approved a specific
action or otherwise determined that further disclosure is appropriate. There is no assurance that the strategic review process will result
in the approval or completion of any specific transaction or outcome.

 Our results of operations
may be adversely affected by fluctuations in currency values.

 We expend expenses in currencies
other than the U.S. dollar. Our reporting currency is the United States dollar. The functional currency of certain subsidiaries is the
Canadian Dollar (" CAD ") or British Pound (" " or " GBP "). The resulting
translation adjustments are recognized in stockholders' equity as a component of accumulated other comprehensive income. Comprehensive
income is defined as the change in equity of an entity from all sources other than investments by owners or distributions to owners and
includes foreign currency translation adjustments as described above. During the years ended December 31, 2023 and 2022, we recorded
other comprehensive (loss) of ($15,816) and ($3,702,963), respectively, as a result of foreign currency translation adjustments.

 Changes in the value of the
currencies which we pay expenses (and in the future receive revenues), versus each other, and the U.S. dollar, could result in an adverse
charge being recorded to our income statement.

 Global economic conditions
could materially adversely affect our business, results of operations, financial condition and growth.

 Adverse macroeconomic conditions,
including inflation, slower growth or recession, new or increased tariffs, changes to fiscal and monetary policy, tighter credit, higher
interest rates, high unemployment and currency fluctuations, as well as the potential implications of a Congressional impasse over the
U.S. debt limit or possible future U.S. governmental shutdowns over budget disagreements, could materially adversely affect our operations,
expenses, access to capital and the market for our planned future products. In addition, consumer confidence and spending could be adversely
affected in response to financial market volatility, negative financial news, conditions in the real estate and mortgage markets, declines
in income or asset values, changes to fuel and other energy costs, labor and healthcare costs and other economic factors.

 In addition, uncertainty
about, or a decline in, global or regional economic conditions could have a significant impact on our funding sources, suppliers and
partners. Potential effects include financial instability; inability to obtain credit to finance operations and purchases of our future
planned products; and insolvency.

 A downturn in the economic
environment could also lead to limitations on our ability to sell equity or issue new debt; reduce liquidity; and result in declines
in the fair value of our financial instruments. These and other economic factors could materially adversely affect our business, results
of operations, financial condition and growth.

 Our industry and the
broader U.S. economy have experienced higher than expected inflationary pressures during 2022 and 2023, related to continued supply chain
disruptions, labor shortages and geopolitical instability. Should these conditions persist our business, future results of operations
and cash flows could be materially and adversely affected.

 During 2022 and the early
part of 2023, there were significant increases in the costs of certain materials, products and shipping costs, as a result of availability
constraints, supply chain disruption, increased demand, labor shortages associated with a fully employed U.S. labor force, high inflation
and other factors. Supply and demand fundamentals have been further aggravated by disruptions in global energy supply caused by multiple
geopolitical events, including the ongoing conflict between Russia and Ukraine, and Israel and Hamas, which threatens to spread to other
Middle Eastern countries. Service, materials and shipping costs have also increased accordingly with general supply chain and inflation
issues seen throughout the U.S. leading to increased operating costs. Supply chain constraints and inflationary pressures have in the
past and may in the future, adversely impact our operating costs and may negatively impact our future product costs, consulting costs
and expenses which could have a material adverse effect on our business, financial condition, results of operations and cash flows.

 Economic uncertainty
may affect our access to capital and/or increase the costs of such capital.

 Global economic conditions
continue to be volatile and uncertain due to, among other things, consumer confidence in future economic conditions, fears of recession
and trade wars, the price of energy, fluctuating interest rates, the availability and cost of consumer credit, the availability and timing
of government stimulus programs, levels of unemployment, increased inflation, tax rates, and the war between Ukraine and Russia which
began in February 2022, and Israel and Hamas, which began in October 2023 and which threatens to spread to other Middle Eastern countries.
These conditions remain unpredictable and create uncertainties about our ability to raise capital in the future. In the event required
capital becomes unavailable in the future, or more costly, it could have a material adverse effect on our business, future results of
operations, and financial condition.

 We may not receive
any amounts under our pre-merger directors' and officers' insurance policy in connection with certain litigation matters.

 On June 29, 2022, AmTrust
International Underwriters DAC (" AmTrust "), which was the premerger directors' and officers' insurance
policy underwriter for KBL, filed a declaratory relief action against us in the U.S. District Court for the Northern District of California
(the " Declaratory Relief Action ") seeking declaration of AmTrust's obligations under the directors'
and officers' insurance policy. In the Declaratory Relief Action, AmTrust is claiming that as a result of the merger, we are no
longer the insured under the subject insurance policy, notwithstanding the fact that the fees which we seek to recover from AmTrust relate
to matters occurring prior to the merger.

 On April 21, 2023, the Court
issued an Order Granting in Part and Denying in Part the Company's Motion for Partial Summary Judgment. Specifically, the Court
granted summary adjudication in favor of the Company on the following issues: (a) that the Company is, in fact, an insured under
both the AmTrust and Freedom insurance policies; (b) that certain SEC subpoena related expenses for defendants Dr. Marlene Krauss,
the Company's former Chief Executive Officer and Director, and George Hornig, the former Chairman of the Board, are within the
basic scope of coverage under both the AmTrust and Freedom insurance policies; and (c) that the Insured vs. Insured exclusion relied
upon by AmTrust and Freedom is not applicable to bar any such coverage.

 The Court also found that
there were issues of disputed facts as to the Change in Control exclusion contained within the policies, which therefore precluded the
Court from granting the remainder of the Company's requests for summary adjudication as a matter of law. Accordingly, the Court,
at this time, denied the Company's further requests for summary adjudication and deemed that for the time being, the Change in
Control issue is to be determined at the time of trial, in order to find that the policies provide (i) coverage for the fees which
the Company has advanced and will advance to Dr. Marlene Krauss and George Hornig; (ii) that AmTrust has breached the policy; (iii) that
AmTrust must pay such expenses of the Company; and that, once the AmTrust policy has been exhausted, (iv) that Freedom will be obligated
to pay such expenses of the Company pursuant to its policy.

 On August 4, 2023, the Court
granted the Company's request to file a second motion for partial summary judgment in this case, this one being on the issue of
whether AmTrust should be required to advance to the Company the defense costs being incurred by Dr. Marlene Krauss and George Hornig
during the pendency of the case. The Company filed such Motion for Partial Summary Judgment, and it has now been fully briefed by the
parties. The hearing for such motion was held on January 11, 2024, however the Judge took the matter under submission and has not yet
issued any decision on the Motion. The parties have commenced written discovery proceedings against each other, and it is
anticipated that depositions will also occur. The Company intends to continue to vigorously pursue this matter in order to establish
the Company's entitlement to full payment by both AmTrust and Freedom of the subject advancement expenses of the Company.

 While the Company continues
to believe it has a strong case against both AmTrust and Freedom and believes the Court ruling in its favor in regards to the matters
discussed above is a significant positive outcome for the Company, there can be no assurance that the Company will prevail in this action.

 Our ability to generate
revenue from any of our potential products is subject to our ability to obtain regulatory approval and fulfill numerous other requirements
and we may never be successful in generating revenues or becoming profitable.

 Our ability to become and
remain profitable depends on our ability to generate revenue or execute other business development arrangements. We do not expect to
generate significant revenue, if any, unless and until we are able to obtain regulatory approval for, and successfully commercialize
the product candidates we are developing or may develop. Successful commercialization, to the extent it occurs, will require achievement
of many key milestones, including demonstrating safety and efficacy in clinical trials, obtaining regulatory approval for these product
candidates, manufacturing, marketing and selling, or entering into other agreements to commercialize, those products for which we may
obtain regulatory approval, satisfying any post-marketing requirements and obtaining reimbursement for our products from private insurance
or government payors. Because of the uncertainties and risks associated with these activities, we cannot accurately and precisely predict
the timing and amount, if any, of revenues, the extent of any further losses or when we might achieve profitability. We may never succeed
in these activities and, even if we do, we may never generate revenues that are sufficient enough for us to achieve profitability. Even
if we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis.

 Our failure to become and
remain profitable may depress the market price of our common stock and could impair our ability to raise capital, expand our business,
diversify our product offerings or continue our operations.

 We have recently grown
our business and will need to increase the size and complexity of our organization in the future, and we may experience difficulties
in managing our growth and executing our growth strategy.

 Our management, personnel
and systems currently in place may not be adequate to support our business plan and future growth. We will need to increase our number
of full-time equivalent employees in order to conduct Phase 1, 2 and 3 clinical trials of our future products and to establish a commercial
organization and commercial infrastructure. As a result of these future activities, the complexity of our business operations is expected
to substantially increase. We will need to develop and expand our scientific, manufacturing, sales and marketing, managerial, compliance,
operational, financial and other resources to support our planned research, development, manufacturing and commercialization activities.

 Our need to effectively manage
our operations, growth and various projects requires that we:

 continue to improve our operational, financial, management and regulatory compliance
 controls and reporting systems and procedures;

 attract and retain sufficient numbers of talented employees;

 manage our commercialization activities effectively and in a cost-effective manner (currently
 trial and development for our clinical trials is very cost effective); and

 manage our development efforts effectively while carrying out our contractual obligations
 to contractors and other third parties.

 We have utilized and continue
to utilize the services of part-time outside consultants and contractors to perform a number of tasks for our company, including tasks
related to compliance programs, clinical trial management, regulatory affairs, formulation development and other drug development functions.
Our growth strategy may entail expanding our use of consultants and contractors to implement these and other tasks going forward. If
we are not able to effectively expand our organization by hiring new employees and expanding our use of consultants and contractors,
we may be unable to successfully implement the tasks necessary to effectively execute on our planned research, development, manufacturing
and commercialization activities and, accordingly, may not achieve our research, development and commercialization goals.

 We face liability for
previously restated financial statements and/or certain actions of our prior management which led to such restatements.

 We filed a Current Report
on Form 8-K on December 31, 2020 and another Current Report on Form 8-K on February 3, 2021, where we announced that due to matters we
discovered which related to KBL, prior to the Business Combination, certain historical financial statements were unreliable. As a result,
we restated our financial statements for the three and six months ended June 30, 2020 and for the three and nine months ended September
30, 2020, because of errors in such financial statements which were identified after such financial statements were filed with the SEC
in our original quarterly reports for the quarters ended June 30, 2020 and September 30, 2020. While we believe these restatements are
the result of the actions of, and are the responsibility of, the management of KBL (none of whom remain employed by us), we may be subject
to stockholder litigation, SEC actions, fines and penalties, rating downgrades, negative publicity and difficulties in attracting and
retaining key clients, employees and management personnel as a result of such restatements. Additionally, our securities may trade at
prices lower than similarly situated companies which have not had to restate their financial statements.

 Our failure to appropriately
adjust processes resulting from significant one-time transactions may result in a misstatement in the financial statements.

 In the course of our annual
audit but prior to filing, we discovered that an error occurred which caused the fair value of our public warrants to be overstated by
an immaterial amount. This error was corrected before the 2022 financial statements were filed. While we believe that the fair value
of warrants in our financial statements for the year ended December 31, 2022 and since such date are correctly stated, it is possible
that similar errors which could have a material adverse effect on our financial condition and results of operations, could require us
to restate our financial statements for prior periods or in the future.

 Operating results may
vary significantly in future periods.

 Our financial results are
unpredictable and may fluctuate, for among other reasons, due to commercial sales of our future product candidates; our achievement of
product development objectives and milestones; clinical trial enrollment and expenses; research and development expenses; and the timing
and nature of contract manufacturing and contract research payments. A high portion of our costs are predetermined on an annual basis,
due in part to our significant research and development costs. Thus, small declines in future revenue could disproportionately affect
financial results in a quarter.

 We depend on our key
personnel and our ability to attract and retain employees.

 Our future growth and success
depend on our ability to recruit, retain, manage and motivate our employees. We are highly dependent on our current management and scientific
personnel, including our Chief Executive Officer, Dr. James N. Woody, our Co-Chairmen, Sir Marc Feldmann, Ph. D., and Lawrence Steinman,
M.D., our Chief Scientific Officer, Jonathan Rothbard, Ph. D., and our scientist, Jagdeep Nanchahal. The inability to hire or retain experienced
management personnel could adversely affect our ability to execute our business plan and harm our operating results. Due to the specialized
scientific and managerial nature of our business, we rely heavily on our ability to attract and retain qualified scientific, technical
and managerial personnel. The competition for qualified personnel in the biotechnological field is intense and we may be unable to continue
to attract and retain qualified personnel necessary for the development of our business or to recruit suitable replacement personnel.

 Problems in our manufacturing
process for our future chemical entities, failure to comply with manufacturing regulations or unexpected increases in our manufacturing
costs could harm our business, results of operations and financial condition.

 We are responsible for the
manufacture and supply of our future product candidates in the CBD derivatives and 7nAChR programs for commercial use and for
use in clinical trials. The manufacturing of our future product candidates necessitates compliance with GMPs and other regulatory requirements
in international jurisdictions. Our ability to successfully manufacture our future product candidates will involve manufacture of finished
products and labeling and packaging, which includes product information, tamper proof evidence and anti-counterfeit features, under tightly
controlled processes and procedures. In addition, we will have to ensure chemical consistency among our batches, including clinical trial
batches and, if approved, marketing batches. Demonstrating such consistency may require typical manufacturing controls as well as clinical
data. We will also have to ensure that our batches conform to complex release specifications. If we are unable to manufacture our future
product candidates in accordance with regulatory specifications, or if there are disruptions in our manufacturing process due to damage,
loss or otherwise, or failure to pass regulatory inspections of our manufacturing facilities, we may not be able to meet demand or supply
sufficient product for use in clinical trials, and this may also harm our ability to commercialize our future product candidates on a
timely or cost-competitive basis, if at all.

 We may not develop and expand
our manufacturing capability in time to meet demand for our product candidates, and the FDA, MHRA or other foreign regulatory authorities
may not accept our facilities or those of our contract manufacturers as being suitable for the production of our products and product
candidates. Any problems in our manufacturing process could materially adversely affect our business, results of operations and financial
condition.

 Our memorandum of understanding
with Celltrion Healthcare may not result in the parties entering into a definitive agreement.

 In September 2021, we entered
into a non-binding memorandum of understanding with Celltrion Healthcare, a biopharmaceutical company, for the supply of an anti-TNF
biosimilar drug used in our ongoing development of anti-TNF products. The parties have not entered into a definitive agreement regarding
such relationship to date, and such definitive agreement may not ultimately be entered into on terms contemplated, if at all. In the
event that we are unable to come to mutually agreeable definitive terms with Celltrion Healthcare, the Company has been in discussions
with an alternative supplier of the anti-TNF biosimilar drug which has expressed interest in proceeding. We may ultimately be unable
to find an alternative supplier or such alternative supplier may require less favorable terms than are currently contemplated. Any of
the above may materially adversely affect our business, results of operations and financial condition.

 We expect to face intense
competition from companies with greater resources and experience than we have; and may face competition from competitors seeking to market
our products under a Section 505(b)(2) application.

 The pharmaceutical industry
is highly competitive and subject to rapid change. The industry continues to expand and evolve as an increasing number of competitors
and potential competitors enter the market. Many of these competitors and potential competitors have substantially greater financial,
technological, managerial and research and development resources and experience than our company. Some of these competitors and potential
competitors have more experience than our company in the development of pharmaceutical products, including validation procedures and
regulatory matters. In addition, our future product candidates, if successfully developed, will compete with product offerings from large
and well-established companies that have greater marketing and sales experience and capabilities than our company or our collaboration
partners have. In particular, Insys Therapeutics, Inc. is developing CBD in Infantile Spasms (" IS "), and potentially
other indications. Zogenix, Inc. has reported positive data in two Phase 3 trials of low dose fenfluramine in Dravet syndrome and has
commenced a Phase 3 trial with this product in Lennox Gastaut Syndrome. Biocodex recently received regulatory approval from the FDA for
the drug Stiripentol (Diacomit) for the treatment of Dravet syndrome. Other companies with greater resources than our company may
announce similar plans in the future. In addition, there are non-FDA approved CBD preparations being made available from companies in
the medical marijuana industry, which might attempt to compete with our future product candidates.

 Many of our competitors have
significantly greater financial and technical resources, experience and expertise in:

 research and development;

 preclinical testing;

 designing and implementing clinical trials;

 regulatory processes and approvals;

 production and manufacturing; and

 sales and marketing of approved products.

 Principal competitive factors
in our industry include:

 the quality and breadth of an organization's technology;

 management of the organization and the execution of the organization's strategy;

 the skill and experience of an organization's employees and its ability to recruit
 and retain skilled and experienced employees;

 an organization's intellectual property portfolio;

 the range of capabilities, from target identification and validation to drug discovery
 and development to manufacturing and marketing; and

 the availability of substantial capital resources to fund discovery, development and
 commercialization activities.

 Additionally, competitors
may also seek to market versions of our drug products via a section 505(b)(2) application, which is a type of NDA provided in section
505(b)(2) of the FDC Act. A Section 505(b)(2) NDA is in contrast to an NDA under section 505(b)(1) of the FDC Act, which
is commonly known as a Full NDA because it requires the applicant to undertake all of the nonclinical and clinical investigations necessary
for the approval of the application. In contrast, a Section 505(b)(2) NDA application is one for which one or more of the investigations
relied on by the applicant for approval were not conducted by or for the applicant and for which the applicant has not obtained a right
of reference or use from the person by or for whom the investigations were conducted. Section 505(b)(2) applications may be submitted
for drug products that represent a modification, such as a new indication or new dosage form, of a previously approved drug. Section
505(b)(2) applications may rely on the FDA's previous findings for the safety and effectiveness of the previously approved
drug in addition to information obtained by the 505(b)(2) applicant to support the modification of the previously approved drug.
Preparing Section 505(b)(2) applications may be less costly and less time-consuming than preparing a Full NDA based entirely on
new data and information. Section 505(b)(2) applications are subject to the same patent certification procedures as an ANDA.

 If we are unable to compete
successfully, our commercial opportunities will be reduced and our business, results of operations and financial conditions may be materially
harmed.

 Our future product
candidates, if approved, may be unable to achieve the expected market acceptance and, consequently, limit our ability to generate revenue
from new products.

 Even when product development
is successful and regulatory approval has been obtained, our ability to generate sufficient revenue depends on the acceptance of our
products by physicians and patients. We cannot assure you that any of our future product candidates will achieve the expected level of
market acceptance and revenue if and when they obtain the requisite regulatory approvals. The market acceptance of any product depends
on a number of factors, including the indication statement, warnings required by regulatory authorities in the product label and new
competing products. Market acceptance can also be influenced by continued demonstration of efficacy and safety in commercial use, physicians'
willingness to prescribe the product, reimbursement from third-party payors such as government health care programs and private third-party
payors, the price of the product, the nature of any post-approval risk management activities mandated by regulatory authorities, competition,
and marketing and distribution support. Further, our U.S. distribution depends on the adequate performance of a reimbursement support
hub and contracted specialty pharmacies in a closed-distribution network. An ineffective or inefficient U.S. distribution model at launch
may lead to inability to fulfill demand, and consequently a loss of revenue. The success and acceptance of a product in one country may
be negatively affected by its activities in another. If we fail to adapt our approach to clinical trials in the U.S. market to meet the
needs of EMA, MHRA or other European regulatory authorities, or to generate the health economics and outcomes research data needed to
support pricing and reimbursement negotiations or decisions in Europe, we may have difficulties obtaining marketing authorization for
our products from EMA/European Commission or the MHRA and may have difficulties obtaining pricing and reimbursement approval for our
products at a national level. Any factors preventing or limiting the market acceptance of our products could have a material adverse
effect on our business, results of operations and financial condition.

 All of our patents
in the Anti-TNF and Fibrosis program are method of use patents, which may result in biosimilar drugs being used without our permission.

 The success of our most advanced
drug development platform depends on the enforceability of our method of use patents, as there are currently many biosimilar anti-TNF
drugs in the market. If we are unable to obtain composition of matter patents, and enforce such patents, our ability to generate revenue
from the anti-TNF platform may be significantly limited and competitors may be able to use our research to bring competing drugs to market
which would reduce our market share.

 The majority of our
license agreements provide the licensors and/or counter-parties the right to use and/or exploit such licensed intellectual property.

 The majority of our license
agreements provide the licensors and/or counter-parties the right to use and/or exploit such licensed intellectual property, and in some
cases provide them ownership of such intellectual property, know-how and research results. As such, we may be in competition with parties
who we have license agreements with, will likely not have the sole right to monetize, sell or distribute our product candidates and may
be subject to restrictions on use and territory of sales. Any or all of the above may have a material adverse effect on our results of
operations and cash flows and ultimately the value of our securities.

 Interim, topline and
preliminary data from our clinical trials may change as more patient data becomes available, and is subject to audit and verification
procedures that could result in material changes in the final data.

 From time to time, we may
publicly disclose preliminary, interim or topline data from our preclinical studies and clinical trials, which is based on a preliminary
analysis of then-available data, and the results and related findings and conclusions are subject to change as patient enrollment and
treatment continues and more patient data become available. For example, any positive results from our preclinical testing, Phase 1 and
Phase 2 clinical trials of our product candidate for any product candidate may not necessarily be predictive of the results from planned
or future clinical trials for such product candidates. Many companies in the pharmaceutical and biotechnology industries have suffered
significant setbacks in clinical trials after achieving positive results in pre-clinical and early clinical development, and we cannot
be certain that we will not face similar setbacks. These setbacks have been caused by, among other things, pre-clinical findings while
clinical trials were underway or safety or efficacy observations in clinical trials, including adverse events. Adverse differences between
previous preliminary or interim data and future interim or final data could significantly harm our business prospects. We may also announce
topline data following the completion of a preclinical study or clinical trial, which may be subject to change following a more comprehensive
review of the data related to the particular study or trial. We also make assumptions, estimations, calculations and conclusions as part
of our analyses of data, and we may not have received or had the opportunity to fully and carefully evaluate all data. As a result, the
interim, topline or preliminary results that we report may differ from future results of the same studies, or different conclusions or
considerations may qualify such results, once additional data has been received and fully evaluated. Preliminary, interim, or topline
data also remains subject to audit and verification procedures that may result in the final data being materially different from the
data we previously published. As a result, preliminary, interim, and topline data should be viewed with caution until the final data
is available.

 Further, others, including
regulatory agencies, may not accept or agree with our assumptions, estimates, calculations, conclusions or analyses or may interpret
or weigh the importance of data differently, which could impact the value of the particular program, the approvability or commercialization
of the particular product candidate or product and our company in general. In addition, the information we choose to publicly disclose
regarding a particular study or clinical trial is based on what is typically extensive information, and you or others may not agree with
what we determine to be material or otherwise appropriate information to include in our disclosure. Moreover, our interpretation of clinical
data or our conclusions based on the preclinical in vitro and in vivo models may prove inaccurate, as preclinical and clinical data can
be susceptible to varying interpretations and analyses, and many companies that believed their product candidates performed satisfactorily
in preclinical studies and clinical trials nonetheless failed to obtain FDA approval or a marketing authorization granted by the European
Commission.

 If we fail to produce positive
results in our future clinical trials, the development timeline and regulatory approval and commercialization prospects for such product
candidates, and, correspondingly, our business and financial prospects, would be materially adversely affected.

 We have limited marketing
experience, and we may not be able to successfully commercialize any of our future product candidates, even if they are approved in the
future.

 Our ability to generate revenues
ultimately will depend on our ability to sell our approved products and secure adequate third-party reimbursement. We currently have
no experience in marketing and selling our products. The commercial success of our future products depends on a number of factors beyond
our control, including the willingness of physicians to prescribe our future products to patients, payors' willingness and ability
to pay for our future products, the level of pricing achieved, patients' response to our future products, and the ability of our
future marketing partners to generate sales. There can be no guarantee that we will be able to establish or maintain the personnel, systems,
arrangements and capabilities necessary to successfully commercialize our future products or any product candidate approved by the FDA,
MHRA or other regulatory authority in the future. If we fail to establish or maintain successful marketing, sales and reimbursement capabilities
or fail to enter into successful marketing arrangements with third parties, our product revenues may suffer.

 If the price for any
of our future approved products decreases or if governmental and other third-party payors do not provide coverage and adequate reimbursement
levels, our revenue and prospects for profitability will suffer.

 Patients who are prescribed
medicine for the treatment of their conditions generally rely on third-party payors to reimburse all or part of the costs associated
with their prescription drugs. Reimbursement systems in international markets vary significantly by country and by region, and reimbursement
approvals generally must be obtained on a country-by-country basis. Coverage and adequate reimbursement from governmental healthcare
programs, such as Medicare and Medicaid, and commercial payors is critical to new product acceptance. Coverage decisions may depend upon
clinical and economic standards that disfavor new drug products when more established or lower cost therapeutic alternatives are already
available or subsequently become available. Even if we obtain coverage for our future product candidates, the resulting reimbursement
payment rates may require co-payments that patients find unacceptably high. Patients may not use our future product candidates if coverage
is not provided or reimbursement is inadequate to cover a significant portion of a patient's cost.

 In addition, the market for
our future product candidates in the U.S. will depend significantly on access to third-party payors' drug formularies, or lists
of medications for which third-party payors provide coverage and reimbursement. The industry competition to be included in such formularies
often leads to downward pricing pressures on pharmaceutical companies. Also, third-party payors may refuse to include a particular branded
drug in their formularies or otherwise restrict patient access to a branded drug when a less costly generic equivalent or other alternative
is available.

 Third-party payors, whether
foreign or domestic, or governmental or commercial, are developing increasingly sophisticated methods of controlling healthcare costs.
The current environment is putting pressure on companies to price products below what they may feel is appropriate. Our future revenues
and overall success could be negatively impacted if we sell future product candidates at less than an optimized price. In addition, in
the U.S., no uniform policy of coverage and reimbursement for drug products exists among third-party payors. Therefore, coverage and
reimbursement for our future product candidates may differ significantly from payor to payor. As a result, the coverage determination
process is often a time-consuming and costly process that will require us to provide scientific and clinical support for the use of our
future product candidates to each payor separately, with no assurance that coverage will be obtained. If we are unable to obtain coverage
of, and adequate payment levels for, our future product candidates, physicians may limit how much or under what circumstances they will
prescribe or administer them and patients may decline to purchase them. This could affect our ability to successfully commercialize our
product candidates, and thereby adversely impact our profitability, results of operations, financial condition and future success.

 In addition, where we have
chosen to collaborate with a third party on product candidate development and commercialization, our partner may elect to reduce the
price of our products to increase the likelihood of obtaining reimbursement approvals. In many countries, products cannot be commercially
launched until reimbursement is approved and the negotiation process in some countries can exceed 12 months. In addition, pricing and
reimbursement decisions in certain countries can be affected by decisions made in other countries, which can lead to mandatory price
reductions and/or additional reimbursement restrictions across a number of other countries, which may adversely affect sales and profitability.
In the event that countries impose prices that are not sufficient to allow us or our partners to generate a profit, our partners may
refuse to launch the product in such countries or withdraw the product from the market, which would adversely affect sales and profitability.

 Business interruptions
could delay us in the process of developing our future product candidates and could disrupt our product sales.

 Loss of our future manufacturing
facilities, stored inventory or laboratory facilities through fire, theft or other causes, could have an adverse effect on our ability
to meet demand for our future product candidates or to continue product development activities and to conduct our business. Failure to
supply our partners with commercial products may lead to adverse consequences, including the right of partners to assume responsibility
for product supply. Even if we obtain insurance coverage to compensate us for such business interruptions, such coverage may prove insufficient
to fully compensate us for the damage to our business resulting from any significant property or casualty loss to our inventory.

 If product liability
lawsuits are successfully brought against us, we will incur substantial liabilities and may be required to limit the commercialization
of our future product candidates.

 Although we have never had
any product liability claims or lawsuits brought against us, we face potential product liability exposure related to the testing of our
future product candidates in human clinical trials, and we will face exposure to claims in jurisdictions where we market and distribute
in the future. We may face exposure to claims by an even greater number of persons when we begin marketing and distributing our products
commercially in the U.S. and elsewhere. In the future, an individual may bring a liability claim against us alleging that one of our
future product candidates caused an injury. While we plan to take what we believe are appropriate precautions, we may be unable to avoid
significant liability if any product liability lawsuit is brought against us. Large judgments have been awarded in class action or individual
lawsuits based on drugs that had unanticipated side effects. Although we plan to purchase insurance to cover product liability lawsuits,
if we cannot successfully defend our company against product liability claims, or if such insurance coverage is inadequate, we will incur
substantial liabilities. Regardless of merit or eventual outcome, liability claims may result in decreased demand for our products, reputational
damage, withdrawal of clinical trial participation participants, litigation costs, product recall costs, monetary awards, increased costs
for liability insurance, lost revenues and business interruption.

 Our employees may have
previously engaged, and/or may in the future engage, in misconduct or other improper activities, including noncompliance with regulatory
standards and legal requirements.

 We are exposed to the risk
of employee fraud or other misconduct. Misconduct by employees could include intentional failures to comply with FDA, SEC or Office of
Inspector General regulations, or regulations of any other applicable regulatory authority, failure to provide accurate information to
the FDA or the SEC, failure to disclose accurate information in SEC filings, failure to comply with applicable manufacturing standards,
other federal, state or foreign laws and regulations, report information or data accurately or disclose unauthorized activities. Employee
misconduct could also involve the improper use of information, including information obtained in the course of clinical trials, or illegal
appropriation of drug product, which could result in government investigations and serious harm to our reputation. Despite our adoption
of a Code of Ethics, employee misconduct is not always possible to identify and deter. The precautions we take to detect and prevent
these prohibited activities may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental
investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. If any such actions
are instituted against our company, and we are not successful in defending our company or asserting our rights, those actions could have
a significant impact on our business, including the imposition of significant fines or other sanctions.

 We are subject to the
U.S. Foreign Corrupt Practices Act and other anti-corruption laws, as well as export control laws, customs laws, sanctions laws and other
laws governing our operations. If we fail to comply with these laws, we could be subject to civil or criminal penalties, other remedial
measures, and legal expenses, which could adversely affect our business, results of operations and financial condition.

 Our operations are subject
to anti-corruption laws, including the U.S. Foreign Corrupt Practices Act (" FCPA "), and other anti-corruption laws
that apply in countries in which we do business. The FCPA and these other laws generally prohibit our company and our employees and intermediaries
from bribing, being bribed or making other prohibited payments to government officials or other persons to obtain or retain business
or gain some other business advantage. We and our commercial partners operate in a number of jurisdictions that pose a high risk of potential
FCPA violations, and we participate in collaborations and relationships with third parties whose actions could potentially subject us
to liability under the FCPA or local anti-corruption laws. In addition, we cannot predict the nature, scope or effect of future regulatory
requirements to which our international operations might be subject or the manner in which existing laws might be administered or interpreted.

 We are also subject to other
laws and regulations governing our international operations, including regulations administered by the governments of the U.S., Canada,
Israel, the U.K. and authorities in the EU, including applicable export control regulations, economic sanctions on countries and persons,
customs requirements and currency exchange regulations, collectively referred to as the Trade Control Laws.

 However, there is no assurance
that we will be completely effective in ensuring our compliance with all applicable anti-corruption laws, including the FCPA or other
legal requirements, including Trade Control Laws. If we are not in compliance with the FCPA and other anti-corruption laws or Trade Control
Laws, we may be subject to criminal and civil penalties, disgorgement and other sanctions and remedial measures, and legal expenses,
which could have an adverse impact on our business, financial condition, results of operations and liquidity. Likewise, any investigation
of any potential violations of the FCPA, other anti-corruption laws by the U.S. or other authorities could also have an adverse impact
on our reputation, business, financial condition and results of operations.

 Security breaches,
loss of data and other disruptions could compromise sensitive information related to our business, prevent us from accessing critical
information or expose us to liability, which could adversely affect our business and our reputation.

 In the ordinary course of
business, we expect to collect and store sensitive data, including legally protected patient health information, credit card information,
personally identifiable information about our employees, intellectual property, and proprietary business information. The secure processing,
storage, maintenance and transmission of this critical information is vital to our operations and business strategy, and we devote significant
resources to protecting such information. Although we take measures to protect sensitive information from unauthorized access or disclosure,
our information technology and infrastructure may be vulnerable to attacks by hackers, or viruses, breaches or interruptions due to employee
error, malfeasance or other disruptions, or lapses in compliance with privacy and security mandates. Any such virus, breach or interruption
could compromise our networks and the information stored there could be accessed by unauthorized parties, publicly disclosed, lost or
stolen. We have measures in place that are designed to prevent, and if necessary, to detect and respond to such security incidents and
breaches of privacy and security mandates. However, in the future, any such access, disclosure or other loss of information could result
in legal claims or proceedings, liability under laws that protect the privacy of personal information, such as HIPAA and European Union
General Data Protection Regulation (" GDPR "), government enforcement actions and regulatory penalties. Unauthorized
access, loss or dissemination could also disrupt our operations, including our ability to process samples, provide test results, share
and monitor safety data, bill payors or patients, provide customer support services, conduct research and development activities, process
and prepare company financial information, manage various general and administrative aspects of our business and may damage our reputation,
any of which could adversely affect our business, financial condition and results of operations.

 GDPR, which applies to all
EU member states includes substantial fines for breaches of the data protection rules and may require us to put in place additional mechanisms
ensuring compliance with the new and changing data protection rules. GDPR is a complex law and the regulatory guidance is still evolving,
including with respect to how GDPR should be applied in the context of clinical trials or other transactions from which we may gain access
to personal data. GDPR increases our costs of compliance and results in greater legal risks.

 Our research and development
programs and product candidates are in development. As a result, we are unable to predict if or when we will successfully develop or
commercialize our product candidates.

 Our clinical-stage product
candidates as well as our other drug pipeline candidates will require significant further investment and regulatory approvals prior to
commercialization. Each of our product candidates will require clinical trial designs that meet the standards and requirements of the
FDA, MHRA or other comparable foreign regulatory authorities, the selection of suitable end points and patients for our clinical trials
and additional clinical development, management of clinical, preclinical and manufacturing activities, obtaining regulatory approval,
obtaining manufacturing supply, building of a commercial organization, substantial investment and significant marketing efforts before
we generate any revenues from product sales. We are not permitted to market or promote any of our product candidates before we receive
regulatory approval from the FDA, MHRA or other comparable foreign regulatory authorities, and we may never receive such regulatory approval
for any of our product candidates. By such time, if ever, as we may receive necessary regulatory approvals for our product candidates,
the standard of care for the treatment of diseases associated with our product candidates may have evolved such that it would be necessary
to modify our plans for full approval and commercial acceptance of our products may be limited by a change in the standard of care.

 Even if we obtain the required
financing or establish a collaboration to enable us to conduct late-stage clinical development of our product candidates and pipeline
assets, we cannot be certain that such clinical development would be successful, or that we will obtain regulatory approval or be able
to successfully commercialize any of our product candidates and generate revenue. Success in preclinical testing and early clinical trials
does not ensure that later clinical trials will be successful, and the clinical trial process may fail to demonstrate that our product
candidates are safe and effective for their proposed uses. Any such failure could cause us to abandon further development of any one
or more of our product candidates and may delay development of other product candidates. Product candidates in later stages of clinical
trials may fail to show the desired safety and efficacy traits despite having progressed through preclinical studies and initial clinical
trials. Any delay in, or termination of, our clinical trials will delay and possibly preclude the submission of any NDAs with the FDA,
Marketing Authorisation Applications (MAA) or Conditional Marketing Authorisations (CMA) with the MHRA, or similar authorizations
with other foreign regulatory agencies, and, ultimately, our ability to commercialize our product candidates and generate product revenue.

 We have not previously submitted
an NDA to the FDA, or MAA or CMA to the MHRA, or similar drug approval filings to comparable foreign authorities, for any product candidate,
and we cannot be certain that any of our product candidates will receive regulatory approval. Further, our product candidates may not
receive regulatory approval even if they are successful in clinical trials. If we do not receive regulatory approvals for our product
candidates, we may not be able to continue our operations. Even if we successfully obtain regulatory approvals to market one or more
of our product candidates, our revenues will be dependent, in part, upon our or our collaborators' and future collaborators'
ability to obtain regulatory approval for the companion diagnostics to be used with our product candidates, if required, and upon the
size of the markets in the territories for which we gain regulatory approval and have commercial rights. If the markets for patient subsets
that we are targeting are not as significant as we estimate, we may not generate significant revenues from sales of such products, if
approved.

 Further, even if any product
candidate we develop was to receive marketing approval or be commercialized for use in combination with other existing therapies, we
would continue to bear the risks that the FDA, MHRA or other similar foreign regulatory authorities could revoke approval of the therapy
used in combination with our product candidate or that safety, efficacy, manufacturing or supply issues could arise with these existing
therapies.

 The successful commercialization
of our product candidates, if approved, will depend on achieving market acceptance and we may not be able to gain sufficient acceptance
to generate significant revenue.

 Even if our product candidates
are successfully developed and receive regulatory approval, they may not gain market acceptance among physicians, patients, healthcare
payors such as private insurers or governments and other funding parties and the medical community. The degree of market acceptance for
any of our products will depend on a number of factors, including:

 demonstration of the clinical efficacy and safety of our products;

 the prevalence and severity of any adverse side effects;

 limitations or warnings contained in the product's approved labeling;

 cost-effectiveness and availability of acceptable pricing;

 competitive product profile versus alternative treatment methods and the superiority
 of alternative treatment or therapeutics;

 the effectiveness of marketing and distribution methods and support for the products;
 and

 the availability of coverage and adequate reimbursement from third-party payors to the
 extent that our products receive regulatory approval.

 Disease indications may be
small subsets of a disease that could be parsed into smaller and smaller indications as different subsets of diseases are defined. This
increasingly fine characterization of diseases could have negative consequences; including creating an approved indication that is so
small as not to have a viable market for us. If future technology allows characterization of a disease in a way that is different from
the characterization used for large pivotal studies, it may make those studies invalid or reduce their usefulness, and may require repeating
all or a portion of the studies. Future technology may supply better prognostic ability which could reduce the portion of patients projected
to need a new therapy. Even after being cleared by regulatory authorities, a product may later be shown to be unsafe or not to have its
purported effect, thereby preventing its widespread use or requiring withdrawal from the market.

 We may not be successful
in establishing development and commercialization collaborations which could adversely affect, and potentially prohibit, our ability
to develop our product candidates.

 Developing pharmaceutical
products, conducting clinical trials, obtaining regulatory approval, establishing manufacturing capabilities and marketing approved products
is expensive, and therefore we have, and may in the future, seek to enter into collaborations with companies that have more resources
and experience in order to continue to develop and commercialize our product candidates. We also may be required due to financial or
scientific constraints to enter into additional collaboration agreements to research and/or to develop and commercialize our product
candidates. The establishment and realization of such collaborations may not be possible or may be problematic. There can be no assurance
that we will be able to establish such additional collaborations on favorable terms, if at all, or that our current or future collaborative
arrangements will be successful or maintained for any specific product candidate or indication. If we are unable to reach successful
agreements with suitable collaboration partners for the ongoing development and commercialization of our product candidates, we may face
increased costs, we may be forced to limit the scope and number of our product candidates we can commercially develop or the territories
in which we commercialize such product candidates, and we may be unable to commercialize products or programs for which a suitable collaboration
partner cannot be found. If we fail to achieve successful collaborations, our operating results and financial condition will be materially
and adversely affected.

 In addition, the terms of
any collaboration agreements may place restrictions on our activities with respect to other products, including by limiting our ability
to grant licenses or develop products with other third parties, or in different indications, diseases or geographical locations, or may
place additional obligations on us with respect to development or commercialization of our product candidates. If we fail to comply with
or breach any provision of a collaboration agreement, a collaborator may have the right to terminate, in whole or in part, such agreement
or to seek damages.

 Our collaboration and licensing
agreements are, and may in the future be, complex and involve sharing or division of ownership of certain data, know-how and intellectual
property rights among the various parties. Accordingly, our collaborators could interpret certain provisions differently than we or our
other collaborators which could lead to unexpected or inadvertent disputes with collaborators. In addition, these agreements might make
additional collaborations, partnering or mergers and acquisitions difficult.

 There is no assurance that
a collaborator who is acquired by a third party would not attempt to change certain contract provisions that could negatively affect
our collaboration. The acquiring company may also not accept the terms or assignment of our contracts and may seek to terminate the agreements.
Any one of our collaborators could breach covenants, restrictions and/or sub-license agreement provisions leading us into disputes and
potential breaches of our agreements with other partners.

 We will not be able
to successfully commercialize our product candidates without establishing sales and marketing capabilities internally or through collaborators.

 We may not be able to find
suitable sales and marketing staff and collaborators for all of our product candidates. The development of a marketing and sales capability
will require significant expenditures, management resources and time. The cost of establishing such a sales force may exceed any potential
product revenue, or our marketing and sales efforts may be unsuccessful. If we are unable to develop an internal marketing and sales
capability in a timely fashion, or at all, or if we are unable to enter into a marketing and sales arrangement with a third party on
acceptable terms, we may be unable to effectively market and sell approved products, if any, which would prevent us from being able to
generate revenue and attain profitability. Further, we may not develop an internal marketing and sales capability if we are unable to
successfully develop and seek regulatory approval for our product candidates.

 We will rely upon third-party
contractors and service providers for the execution of some aspects of our development programs. Failure of these collaborators to provide
services of a suitable quality and within acceptable timeframes may cause the delay or failure of our development programs.

 We outsource certain functions,
tests and services to third parties, partners, medical institutions and collaborators and plan to outsource manufacturing to collaborators
and/or contract manufacturers, and we will rely on third parties for quality assurance, clinical monitoring, clinical data management
and regulatory expertise. In particular, we rely on our partners to run our clinical trials. There is no assurance that such individuals
or organizations will be able to provide the functions, tests, drug supply or services as agreed upon or to acceptable quality standards,
and we could suffer significant delays in the development of our products or processes. In particular, certain third party service providers
may be unable to comply with their contractual obligations to us due to disruptions caused by lack of qualified employees and consultants,
reduced operations or headcount reductions, or otherwise, and in certain cases we may have limited recourse if the non-compliance is
due to factors outside of the service provider's control.

 Our business is highly
dependent on the success of our product candidates. If we are unable to successfully complete clinical development, obtain regulatory
approval for or commercialize one or more of our product candidates, or if we experience delays in doing so, our business will be materially
harmed.

 Our future success and ability
to generate significant revenue from our product candidates, which we do not expect will occur for several years, is dependent on our
ability to successfully develop, obtain regulatory approval for and commercialize one or more of our product candidates, including our
Dupuytren's Contracture product candidate, which has previously completed a successful Phase 2b clinical trial in the U.K., a condition
that affects the development of fibrous connective tissue in the palm of the hand. All of our other product candidates are in earlier
stages of development and will require substantial additional investment for manufacturing, preclinical testing, clinical development,
regulatory review and approval in one or more jurisdictions. If any of our product candidates encounter safety or efficacy problems,
development delays or regulatory issues or other problems, our development plans and business would be materially harmed.

 We may not have the financial
resources to continue development of our product candidates. Even if clinical trials are completed, we may experience other issues that
may delay or prevent regulatory approval of, or our ability to commercialize, our product candidates, including:

 inability to demonstrate to the satisfaction of the FDA, MHRA or other comparable foreign
 regulatory authorities that our product candidates are safe and effective;

 insufficiency of our financial and other resources to complete the necessary clinical
 trials and preclinical studies;

 negative or inconclusive results from our clinical trials, preclinical studies or the
 clinical trials of others for product candidates that are similar to ours, leading to a decision or requirement to conduct additional
 clinical trials or preclinical studies or abandon a program;

 product-related adverse events experienced by subjects in our clinical
 trials, including unexpected toxicity results, or by individuals using drugs or therapeutic biologics similar to our product candidates;

 delays in submitting an Investigational New Drug application, or IND,
 or comparable foreign applications or delays or failure in obtaining the necessary approvals from regulators to commence a clinical
 trial or a suspension or termination, or hold, of a clinical trial once commenced;

 conditions imposed by the FDA, the EMA, MHRA or other comparable foreign
 regulatory authorities regarding the scope or design of our clinical trials;

 poor effectiveness of our product candidates during clinical trials;

 better than expected performance of control arms, such as placebo groups,
 which could lead to negative or inconclusive results from our clinical trials;

 delays in enrolling subjects in clinical trials;

 high drop-out rates of subjects from clinical trials;

 inadequate supply or quality of product candidates or other materials
 necessary for the conduct of our clinical trials;

 greater than anticipated clinical trial or manufacturing costs;

 unfavorable FDA, EMA, MHRA or other comparable regulatory authority
 inspection and review of a clinical trial site;

 failure of our third-party contractors or investigators to comply with
 regulatory requirements or the clinical trial protocol or otherwise meet their contractual obligations in a timely manner, or at
 all;

 unfavorable FDA, EMA, MHRA or other comparable regulatory authority
 inspection and review of manufacturing facilities or inability of those facilities to maintain a compliance status acceptable to
 the FDA, EMA or comparable regulatory authorities;

 delays and changes in regulatory requirements, policy and guidelines,
 including the imposition of additional regulatory oversight around clinical testing generally or with respect to our therapies in
 particular; or

 varying interpretations of data by the FDA, EMA, MHRA and other comparable
 foreign regulatory authorities.

 Our product candidates will
require additional, time-consuming development efforts prior to commercial sale, including preclinical studies, clinical trials and approval
by the FDA, EMA, MHRA and/or other applicable foreign regulatory authorities. All product candidates are prone to the risks of failure
that are inherent in pharmaceutical product development, including the possibility that such product candidate will not be shown to be
sufficiently safe and effective for approval by regulatory authorities. In addition, we cannot assure stockholders that any such products
that are approved will be manufactured or produced economically, successfully commercialized or widely accepted in the marketplace or
be more effective than other commercially available alternatives.

 Due to the significant
resources required for the development of our product pipeline, and depending on our ability to access capital, we must prioritize the
development of certain product candidates over others. Moreover, we may fail to expend our limited resources on product candidates or
indications that may have been more profitable or for which there is a greater likelihood of success.

 We have three separate programs
for producing anti-inflammatory agents: (1) investigating new clinical opportunities for anti-TNF, (2) identifying orally available,
small molecules that are agonists of 7 nicotinic acetylcholine receptor, and (3) identifying patentable analogs of CBD that
initially will be used as pain medications, that are at various stages of preclinical development. Due to the significant resources required
for the development of our product candidates, we must focus on specific diseases and disease pathways and decide which product candidates
to pursue and advance and the amount of resources to allocate to each. Our decisions concerning the allocation of research, development,
collaboration, management and financial resources toward particular product candidates or therapeutic areas may not lead to the development
of any viable commercial products and may divert resources away from better opportunities. If we make incorrect determinations regarding
the viability or market potential of any of our product candidates or misinterpret trends in the pharmaceutical industry, our business,
financial condition, and results of operations could be materially adversely affected. As a result, we may (i) fail to capitalize
on viable commercial products or profitable market opportunities, (ii) be required to forego or delay pursuit of opportunities with
other product candidates or other diseases and disease pathways that may later prove to have greater commercial potential than those
we choose to pursue, or (iii) relinquish valuable rights to such product candidates through collaboration, licensing, or other royalty
arrangements in cases in which it would have been advantageous for us to invest additional resources to retain sole development and commercialization
rights.

 The timelines of our
clinical trials may be impacted by numerous factors and any delays may adversely affect our ability to execute our current business strategy.

 Clinical testing is expensive,
difficult to design and implement, can take many years to complete, and is uncertain as to outcome. We may experience delays in clinical
trials at any stage of development and testing of our product candidates. Our planned clinical trials may not begin on time, have an
effective design, enroll a sufficient number of subjects, or be completed on schedule, if at all.

 Events which may result in
a delay or unsuccessful completion of clinical trials include:

 inability to raise funding necessary to initiate or continue a trial;

 delays in obtaining regulatory approval to commence a trial;

 delays in reaching agreement with the FDA, MHRA or other foreign regulators
 on final trial design;

 imposition of a clinical hold following an inspection of our clinical
 trial operations or trial sites by the FDA, MHRA or other regulatory authorities;

 delays in reaching agreement on acceptable terms with prospective CROs
 and clinical trial sites;

 delays in obtaining required institutional review board approval at
 each site;

 delays in having subjects complete participation in a trial or return
 for post-treatment follow-up;

 delays caused by subjects dropping out of a trial due to side effects
 or otherwise;

 clinical sites dropping out of a trial to the detriment of enrollment;

 time required to add new clinical sites; and

 delays by our contract manufacturers to produce and deliver a sufficient
 supply of clinical trial materials.

 If initiation or completion
of any of our clinical trials for our product candidates are delayed for any of the above reasons or for other reasons, our development
costs may increase, our approval process could be delayed, any periods after commercial launch and before expiration of patent protection
may be reduced and our competitors may have more time to bring products to market before we do. Any of these events could impair the
commercial potential of our product candidates and could have a material adverse effect on our business.

 Clinical trials of
our product candidates may not uncover all possible adverse effects that patients may experience.

 Clinical trials are conducted
in representative samples of the potential patient population, which may have significant variability. Clinical trials are by design
based on a limited number of subjects and of limited duration for exposure to the product used to determine whether, on a potentially
statistically significant basis, the planned safety and efficacy of any product candidate can be achieved. As with the results of any
statistical sampling, we cannot be sure that all side effects of our product candidates may be uncovered, and it may be the case that
only with a significantly larger number of patients exposed to the product candidate for a longer duration, that a more complete safety
profile is identified. Further, even larger clinical trials may not identify rare serious adverse effects or the duration of such studies
may not be sufficient to identify when those events may occur. Patients treated with our products, if approved, may experience adverse
reactions and it is possible that the FDA, MHRA or other regulatory authorities may ask for additional safety data as a condition of,
or in connection with, our efforts to obtain approval of our product candidates. If safety problems occur or are identified after our
product candidates reach the market, we may, or regulatory authorities may require us to amend the labeling of our products, recall our
products or even withdraw approval for our products.

 Failure can occur at
any stage of our drug development efforts.

 We may experience numerous
unforeseen events during, or as a result of, testing that could delay or prevent us from obtaining regulatory approval for, or commercializing
our drug candidates, including but not limited to:

 regulators or Institutional Review Boards (IRBs) may not authorize
 us to commence a clinical trial or conduct a clinical trial at a prospective trial site;

 conditions may be imposed upon us by the FDA and/or MHRA regarding the
 scope or design of our clinical trials, or we may be required to resubmit our clinical trial protocols to IRBs for review due to
 changes in the regulatory environment;

 the number of subjects required for our clinical trials may be larger,
 patient enrollment may take longer, or patients may drop out of our clinical trials at a higher rate than we anticipate;

 we may have to suspend or terminate one or more of our clinical trials
 if we, regulators, or IRBs determine that the participants are being subjected to unreasonable health risks;

 our third-party contractors, clinical investigators or contractual collaborators
 may fail to comply with regulatory requirements or fail to meet their contractual obligations to us in a timely manner;

 the FDA may not accept clinical data from trials that are conducted
 at clinical sites in countries where the standard of care is potentially different from the U.S.;

 our tests may produce negative or inconclusive results, and we may decide,
 or regulators may require us, to conduct additional testing; and

 the costs of our pre-clinical and/or clinical trials may be greater
 than we anticipate.

 We rely on third parties
to conduct our pre-clinical studies and clinical studies and trials, and if they do not perform their obligations to us, we may not be
able to obtain approval for additional indications.

 We do not currently have
the ability to independently conduct pre-clinical studies or clinical studies and trials, and we have to date relied on third parties,
such as third-party contract research and governmental organizations and medical institutions to conduct studies and trials for us. Our
reliance on third parties for development activities reduces our control over these activities. These third parties may not complete
activities on schedule or may not conduct our pre-clinical studies and our clinical studies and trials in accordance with regulatory
requirements or our study design. If these third parties do not successfully carry out their contractual duties or meet expected deadlines,
we may be adversely affected, and our efforts to obtain regulatory approvals for and commercialize indications may be delayed.

 If we conduct studies with
other parties, we may not have control over all decisions associated with that trial. To the extent that we disagree with the other party
on such issues as study design, study timing and the like, it could adversely affect our drug development plans.

 Although we also rely on
third parties to manage the data from our studies and trials, we are responsible for confirming that each of our studies and trials is
conducted in accordance with its general investigational plan and protocol. Moreover, the FDA and foreign regulatory agencies will require
us to comply with applicable regulations and standards, including Good Laboratory Practice (GLP) and Good Clinical Practice (GCP),
for conducting, recording and reporting the results of such studies and trials to assure that the data and the results are credible and
accurate and that the human study and trial participants are adequately protected. Our reliance on third-parties does not relieve us
of these obligations and requirements, and we may fail to obtain regulatory approval for any additional indications if these requirements
are not met.

 We will need to continue
to develop and maintain distribution and production capabilities or relationships to be successful.

 We may not be able to successfully
manufacture any product, either independently or under manufacturing arrangements, if any, with third party manufacturers. Moreover,
if any manufacturer should cease doing business with us or experience delays, shortages of supply or excessive demands on their capacity,
we may not be able to obtain adequate quantities of product in a timely manner, or at all. Manufacturers, and in certain situations their
suppliers, are required to comply with current NDA commitments and current good manufacturing practices (cGMP) requirements enforced
by the FDA, and similar requirements of other countries. The failure by a manufacturer to comply with these requirements could affect
its ability to provide us with products. Although we intend to rely on third-party contract manufacturers, we are ultimately responsible
for ensuring that our products are manufactured in accordance with cGMP. In addition, if, during a preapproval inspection or other inspection
of our third-party manufacturers' facility or facilities, the FDA determines that the facility is not in compliance with cGMP,
any of our marketing applications that lists such facility as a manufacturer may not be approved or approval may be delayed until the
facility comes into compliance with cGMP and completes a successful re-inspection by the FDA.

 Any manufacturing problem,
natural disaster, or epidemic, affecting manufacturing facilities, or the loss of a contract manufacturer could be disruptive to our
operations and result in lost sales. Additionally, we will be reliant on third parties to supply the raw materials needed to manufacture
our products. Any reliance on suppliers may involve several risks, including a potential inability to obtain critical materials and reduced
control over production costs, delivery schedules, reliability and quality. Any unanticipated disruption to future contract manufacture
caused by problems at suppliers could delay shipment of products, increase our cost of goods sold and result in lost sales. If our suppliers
were unable to supply us with adequate supply of our drugs, it could have a material adverse effect on our ability to successfully commercialize
our drug candidates.

 If we fail to discover,
develop and commercialize other product candidates, we may be unable to grow our business and our ability to achieve our strategic objectives
would be impaired. In addition, we may also seek to commercialize certain treatments that may not be proprietary to us.

 Although the development
and commercialization of our current product candidates are our initial focus, as part of our long-term growth strategy, we plan to develop
other product candidates. While we believe our planned products may have potential applicability to other uses, we have not conducted
any clinical trials on these other uses and we may not be successful in developing product candidates for other uses. In addition, we
intend to devote capital and resources for basic research to discover and identify additional product candidates. These research programs
require technical, financial and human resources, whether or not any product candidates are ultimately identified. Our research programs
may initially show promise in identifying potential product candidates, yet fail to yield product candidates for clinical development
for many reasons, including the following:

 the research methodology used may not be successful in identifying potential product
 candidates;

 competitors may develop alternatives that render our product candidates obsolete;

 product candidates that we develop may nevertheless be covered by third parties'
 patents or other exclusive rights;

 a product candidate may, on further study, be shown to have harmful side effects
 or other characteristics that indicate it is unlikely to be effective or otherwise does not meet applicable regulatory criteria;

 a product candidate may not be capable of being produced in commercial quantities
 at an acceptable cost, or at all; and

 a product candidate may not be accepted as safe and effective by patients, the medical
 community or third-party payors.

 If we do not achieve
our projected development and commercialization goals within the timeframes we expect, the development and commercialization of our product
candidates may be delayed, and our business and results of operations may be harmed.

 For planning purposes, we
seek to estimate the timing of the accomplishment of various scientific, clinical, regulatory and other product development objectives.
These milestones may include our expectations regarding the commencement or completion of scientific studies and clinical trials, the
submission of regulatory filings, or commercialization objectives. From time to time, we may publicly announce the expected timing of
some of these milestones, such as the completion of an ongoing clinical trial, the initiation of other clinical programs, receipt of
marketing approval or a commercial launch of a product. The potential achievement of many of these milestones may be outside of our control.
Each of these milestones is based on a variety of assumptions which, if not realized as expected, may cause the timing of such potential
achievement of the respective milestones to vary considerably from our estimates, including:

 our available capital resources or capital constraints we experience;

 the rate of progress, costs and results of our clinical trials and research and
 development activities, including the extent of scheduling conflicts with participating clinicians and collaborators;

 our ability to identify and enroll patients who meet clinical trial eligibility
 criteria;

 our receipt of approvals by the FDA, MHRA and other regulatory authorities and the
 timing thereof;

 clinical outcomes;

 other actions, decisions or rules issued by regulators;

 our ability to access sufficient, reliable and affordable supplies of materials
 used in the manufacture of our product candidates;

 the efforts of our collaborators with respect to the commercialization of our product
 candidates; and

 the securing of, costs related to, and timing issues associated with, product manufacturing
 as well as sales and marketing activities.

 If we fail to achieve any
announced milestones in the timeframes we expect, the development and commercialization of our product candidates may be delayed, and
our business and results of operations may be harmed, and it could negatively impact our share price performance. Please see the section
entitled "Item 1. Business" in this Report for more information.

 If we rely on a sole
source of supply to manufacture our products we could be impacted by the viability of our supplier.

 We intend to attempt to source
our products from more than one supplier. We also intend to enter into contracts with any supplier of our products to contractually obligate
them to meet our requirements. However, if we are reliant on a single supplier and that supplier cannot or will not meet our requirements
(for whatever reason), our business could be adversely impacted.

 We may not be able
to sufficiently scale-up manufacturing of our drug candidates.

 We may not be able to successfully
increase in a sufficient manner the manufacturing capacity for our drug candidates, whether in collaboration with third-party manufacturers
or on our own, in a timely or cost-effective manner or at all. If a contract manufacturer makes improvements in the manufacturing process
for our drug candidates, we may not own, or may have to share, the intellectual property rights to those improvements.

 Significant scale-up of manufacturing
may require additional validation studies, which are costly and which the FDA must review and approve. In addition, quality issues may
arise during those scale-up activities because of the inherent properties of a drug candidate itself or of a drug candidate in combination
with other components added during the manufacturing and packaging process, or during shipping and storage of the finished product or
active pharmaceutical ingredients. If we are unable to successfully scale-up manufacture of any of our drug candidates in sufficient
quality and quantity, the development of that drug candidate and regulatory approval or commercial launch for any resulting drug products
may be delayed or there may be a shortage in supply, which could significantly harm our business.

 Our and our partner's
operations are subject to risks associated with ongoing and potential future global conflicts, including specifically the operations
of Yissum, our research partner.

 In February 2022, an armed
conflict escalated between Russia and Ukraine. The sanctions announced by the United States and other countries against Russia and Belarus
following Russia's invasion of Ukraine to date include restrictions on selling or importing goods, services, or technology in or
from affected regions and travel bans and asset freezes impacting connected individuals and political, military, business, and financial
organizations in Russia and Belarus. The United States and other countries could impose wider sanctions and take other actions should
the conflict further escalate. Separately, in October 2023, Israel and certain Iranian-backed Palestinian forces began an armed conflict
in Israel, the Gaza Strip, and surrounding areas, which threatens to spread to other Middle Eastern countries including Lebanon and Iran.

 These wars are increasingly
affecting economic and global financial markets and exacerbating ongoing economic challenges, including issues such as rising inflation
and global supply-chain disruption. While we do not believe these conflicts currently have a material impact on our financial accounting
and reporting, the degree to which we will be affected in the future largely depends on the nature and duration of uncertain and unpredictable
events, and our business could be impacted. Additionally, we currently have agreements and relationships in place with Yissum Research
Development Company of the Hebrew University of Jerusalem, Ltd. (" Yissum "), located in Israel, and Yissum's
operations may be materially affected by the ongoing war in Israel, which may delay, prevent, or materially increase the cost of the
ongoing services Yissum is required to provide to the Company. Furthermore, future global conflicts or wars could create further economic
challenges, including, but not limited to, increases in inflation and further global supply-chain disruption. Consequently, the ongoing
Russia/Ukraine Hamas/Israel conflicts and/or other future global conflicts, could result in an increase in operating expenses and/or
a decrease in any future revenue and could further have a material adverse effect on our results of operations and cash flow.

 We may enter into
strategic transactions in the future which may result in a material change in our operations and/or a change of control.

 In December 2023, we engaged
A.G.P./Alliance Global Partners as financial advisor to explore and evaluate strategic alternatives to enhance shareholder value. Potential
strategic alternatives that may be explored or evaluated by the Company as part of this process include, but are not limited to, an acquisition,
merger, reverse merger, other business combination, sale of assets, licensing or other strategic transactions involving the Company.
The Company does not intend to discuss or disclose further developments during this process unless and until its Board of Directors has
approved a specific action or otherwise determined that further disclosure is appropriate. There is no assurance that the strategic review
process will result in the approval or completion of any specific transaction or outcome.

 The Board of Directors and
management team are committed to acting in the best interests of the Company, its stockholders and its stakeholders. There is no deadline
or definitive timetable set for completion of the strategic alternatives review process and there can be no assurance that this process
will result in the Company pursuing a transaction or any other strategic outcome.

 As a result of the above,
in the future, we may enter into transactions with parties seeking to merge and/or acquire us and/or our operations. While we have not
entered into any agreements or understandings with any such parties to date, in the event that we do enter into such a transaction or
transactions in the future, new shares of common stock or preferred stock could be issued resulting in substantial dilution to our then
current stockholders and/or a change of control. As a result, our new majority stockholders may change the composition of our Board of
Directors and may replace our current management. Any future transaction may also result in a change in our business focus. We have not
entered into any agreements relating to any strategic transaction involving the Company as of the date of this Report and may not enter
into such agreements in the future. Any future strategic transaction involving the Company or its operations may have a material effect
on our operations, cash flows, results of operations, prospects, plan of operations, the listing of our common stock on Nasdaq, our officers,
directors and majority stockholder(s), and the value of our securities.

 Risks Related to Development and Regulatory Approval of our Future
Product Candidates

 Clinical trials are
expensive, time-consuming, uncertain and susceptible to change, delay or termination. The results of clinical trials are open to differing
interpretations.

 We have three separate programs
for producing anti-inflammatory agents: (1) investigating new clinical opportunities for anti-TNF, (2) identifying orally available,
small molecules that are agonists of 7 nicotinic acetylcholine receptor, and (3) identifying patentable analogs of CBD that
initially will be used as pain medications. However, these programs, including the related clinical trials, are expensive, time consuming
and difficult to design and implement.

 Regulatory agencies may not
accept clinical trial designs submitted by us, and may analyze or interpret the results of clinical trials differently than us. Even
if the results of our clinical trials are favorable, the clinical trials for a number of our future product candidates are expected to
continue for several years and may take significantly longer to complete. In addition, the FDA, MHRA or other regulatory authorities,
including state, local and foreign authorities, or an IRB, with respect to a trial at our institution, may suspend, delay or terminate
our clinical trials at any time, require us to conduct additional clinical trials, require a particular clinical trial to continue for
a longer duration than originally planned, require a change to our development plans such that we conduct clinical trials for a product
candidate in a different order, e.g., in a step-wise fashion rather than running two trials of the same product candidate in parallel,
or could suspend or terminate the registrations and quota allotments we require in order to procure and handle controlled substances,
for various reasons, including the following, any of which could have a material adverse effect on our business, financial condition
and results of operations:

 lack of effectiveness of any product candidate during clinical trials;

 discovery of serious or unexpected toxicities or side effects experienced by trial
 participants or other safety issues, such as drug interactions, including those which cause confounding changes to the levels of
 other concomitant medications;

 slower than expected rates of subject recruitment and enrollment rates in clinical
 trials;

 difficulty in retaining subjects who have initiated a clinical trial but may withdraw
 at any time due to adverse side effects from the therapy, insufficient efficacy, fatigue with the clinical trial process or for any
 other reason;

 delays or inability in manufacturing or obtaining sufficient quantities of materials
 for use in clinical trials due to regulatory and manufacturing constraints;

 inadequacy of or changes in our manufacturing process or product formulation;

 delays in obtaining regulatory authorization to commence a trial, including "clinical
 holds" or delays requiring suspension or termination of a trial by a regulatory agency, such as the FDA, before or after a
 trial is commenced;

 DEA related recordkeeping, reporting security or other violations at a clinical
 site, leading the DEA or state authorities to suspend or revoke the site's-controlled substance license and causing a delay
 or termination of planned or ongoing trials;

 changes in applicable regulatory policies and regulation, including changes to requirements
 imposed on the extent, nature or timing of studies;

 delays or failure in reaching agreement on acceptable terms in clinical trial contracts
 or protocols with prospective clinical trial sites;

 uncertainty regarding proper dosing;

 delay or failure to supply product for use in clinical trials which conforms to
 regulatory specification;

 unfavorable results from ongoing pre-clinical studies and clinical trials;

 failure of our CROs, or other third-party contractors to comply with all contractual
 requirements or to perform their services in a timely or acceptable manner;

 failure by our company, our employees, our CROs or their employees to comply with
 all applicable FDA or other regulatory requirements relating to the conduct of clinical trials;

 scheduling conflicts with participating clinicians and clinical institutions;

 failure to design appropriate clinical trial protocols;

 regulatory concerns with CBD derivative products generally and the potential for
 abuse, despite only working with non-plant based non-psychoactive products;

 insufficient data to support regulatory approval;

 inability or unwillingness of medical investigators to follow our clinical protocols;
 or

 difficulty in maintaining contact with patients during or after treatment, which
 may result in incomplete data.

 We may find it difficult
to enroll patients in our clinical trials, which could delay or prevent clinical trials of our product candidates.

 Identifying and qualifying
patients to participate in clinical trials of our product candidates is critical to our success. The timing of our clinical trials depends
on the speed at which we can recruit eligible patients to participate in testing our product candidates. We have experienced delays in
some of our clinical trials, and we may experience similar delays in the future. These delays could result in increased costs, delays
in advancing our product development, or termination of the clinical trials altogether.

 We may not be able to identify,
recruit and enroll a sufficient number of patients, or those with required or desired characteristics to achieve diversity in a study,
to complete our clinical trials within the expected timeframe. Patient enrollment can be impacted by factors including, but not limited
to:

 design and complexity and/or commitment of participation required in the study protocol;

 size of the patient population;

 eligibility criteria for the study in question;

 clinical supply availability;

 delays in participating site identification, qualification and subsequent activation
 to enroll;

 perceived risks and benefits of the product candidate under study, including as
 a result of adverse effects observed in similar or competing therapies;

 proximity and availability of clinical trial sites for prospective patients;

 availability of competing therapies and clinical trials;

 competition of
 site efforts to facilitate timely enrollment in clinical trials;

 participating site motivation;

 patient referral practices of physicians;

 activities of patient advocacy groups;

 ability to monitor patients adequately during and after treatment; and

 severity of the disease under investigation.

 In particular, each of the
conditions for which we plan to evaluate our product candidates are diseases with limited patient pools from which to draw for clinical
trials. The eligibility criteria of our clinical trials will further limit the pool of available study participants. Additionally, the
process of finding and diagnosing patients may prove costly. The treating physicians in our clinical trials may also use their medical
discretion in advising patients enrolled in our clinical trials to withdraw from our studies to try alternative therapies. In addition,
pandemics or epidemics may impact patient ability and willingness to travel to clinical trial sites as a result of quarantines and other
restrictions, which may negatively impact enrollment in our clinical trials, for example, our trials have in the past had difficulty
recruiting a sufficient number of patients due to the COVID-19 pandemic.

 We may not be able to initiate
or continue clinical trials if we cannot enroll the required eligible patients per protocol to participate in the clinical trials required
by the FDA or the EMA, MHRA or other regulatory agencies. Our ability to successfully initiate, enroll and complete a clinical trial
in any foreign country is subject to numerous risks unique to conducting business in foreign countries, including:

 difficulty in establishing or managing relationships with CROs and physicians;

 different standards for the conduct of clinical trials;

 our inability to locate qualified local consultants, physicians and partners;

 the potential burden of complying with a variety of foreign laws, medical standards
 and regulatory requirements, including the regulation of pharmaceutical and biotechnology products and treatment;

 ability to procure and deliver necessary clinical trial materials needed to perform
 the study; and

 inability to implement adequate training at participating sites remotely when in
 person training cannot be completed.

 If we have difficulty enrolling
a sufficient number of patients to conduct our clinical trials as planned, we may need to delay, limit or terminate ongoing or planned
clinical trials, any of which would have an adverse effect on our ability to complete clinical trials and ultimately our results of operations.

 Any failure by our
company to comply with existing regulations could harm our reputation and operating results.

 We are subject to extensive
regulation by U.S. federal and state and foreign governments in each of the U.S., European and Canadian markets, in which we plan to
sell our products, or in markets where we have product candidates progressing through the approval process.

 We must adhere to all regulatory
requirements including FDA's GLP, GCP and GMP requirements, pharmacovigilance requirements, advertising and promotion restrictions,
reporting and recordkeeping requirements, and their European equivalents. If we or our suppliers fail to comply with applicable regulations,
including FDA pre-or post-approval requirements, then the FDA or other foreign regulatory authorities could sanction our company. Even
if a drug is approved by the FDA or other competent authorities, regulatory authorities may impose significant restrictions on a product's
indicated uses or marketing or impose ongoing requirements for potentially costly post-marketing trials. Any of our product candidates
which may be approved in the U.S. will be subject to ongoing regulatory requirements for manufacturing, labeling, packaging, storage,
distribution, import, export, advertising, promotion, sampling, recordkeeping and submission of safety and other post-market information,
including both federal and state requirements. In addition, manufacturers and manufacturers' facilities are required to comply
with extensive FDA requirements, including ensuring that quality control and manufacturing procedures conform to GMP. As such, we and
our contract manufacturers (in the event contract manufacturers are appointed in the future) are subject to continual review and
periodic inspections to assess compliance with GMP. Accordingly, we and others with whom we work will have to spend time, money and effort
in all areas of regulatory compliance, including manufacturing, production, quality control and quality assurance. We will also be required
to report certain adverse reactions and production problems, if any, to the FDA, and to comply with requirements concerning advertising
and promotion for our products. Promotional communications with respect to prescription drugs are subject to a variety of legal and regulatory
restrictions and must be consistent with the information in the product's approved label. Similar restrictions and requirements
exist in the EU and other markets where we operate.

 If a regulatory agency discovers
previously unknown problems with a product, such as adverse events of unanticipated severity or frequency, or problems with the facility
where the product is manufactured, or disagrees with the promotion, marketing or labeling of the product, it may impose restrictions
on that product or on our company, including requiring withdrawal of the product from the market. If we fail to comply with applicable
regulatory requirements, a regulatory agency or enforcement authority may issue warning letters, impose civil or criminal penalties,
suspend regulatory approval, suspend any of our ongoing clinical trials, refuse to approve pending applications or supplements to approved
applications submitted by us, impose restrictions on our operations, or seize or detain products or require a product recall.

 In addition, it is possible
that our future products will be regulated by the DEA, under the Controlled Substances Act or under similar laws elsewhere. DEA scheduling
is a separate process that can delay when a drug may become available to patients beyond an NDA approval date, and the timing and outcome
of such DEA process is uncertain. See also " Risks Related to Controlled Substances ", below.

 In addition, any government
investigation of alleged violations of law could require us to spend significant time and resources in response and could generate negative
publicity. Any failure to comply with ongoing regulatory requirements may significantly and adversely affect our ability to commercialize
and generate revenue from our future product candidates. If regulatory sanctions are applied or if regulatory approval is withdrawn,
the value of our business and our operating results may be adversely affected.

 Any action against us for
violation of these laws, even if we successfully defend against it, could cause us to incur significant legal expenses, divert our management's
attention from the operation of our business and damage our reputation. We expect to spend significant resources on compliance efforts
and such expenses are unpredictable. Changing laws, regulations and standards might also create uncertainty, higher expenses and increase
insurance costs. As a result, we intend to invest all reasonably necessary resources to comply with evolving standards, and this investment
might result in increased management and administrative expenses and a diversion of management time and attention from revenue-generating
activities to compliance activities.

 We are subject to federal,
state and foreign healthcare laws and regulations and implementation of or changes to such healthcare laws and regulations could adversely
affect our business and results of operations.

 In both the U.S. and certain
foreign jurisdictions, there have been a number of legislative and regulatory proposals to change the healthcare system in ways that
could impact our ability to sell our future product candidates. If we are found to be in violation of any of these laws or any other
federal, state or foreign regulations, we may be subject to administrative, civil and/or criminal penalties, damages, fines, individual
imprisonment, we from federal health care programs and the restructuring of our operations. Any of these could have a material adverse
effect on our business and financial results. Since many of these laws have not been fully interpreted by the courts, there is an increased
risk that we may be found in violation of one or more of their provisions. Any action against us for violation of these laws, even if
we ultimately are successful in our defense, will cause us to incur significant legal expenses and divert our management's attention
away from the operation of our business. In addition, in many foreign countries, particularly the countries of the EU, the pricing of
prescription drugs is subject to government control.

 In some foreign countries,
the proposed pricing for a drug must be approved before it may be lawfully marketed. The requirements governing drug pricing vary widely
from country to country.

 For example, some EU jurisdictions
operate positive and negative list systems under which products may only be marketed once a reimbursement price has been agreed. To obtain
reimbursement or pricing approval, some of these countries may require the completion of clinical trials that compare the cost-effectiveness
of a particular product candidate to currently available therapies. Other member states allow companies to fix their own prices for medicines
but monitor and control company profits. Such differences in national pricing regimes may create price differentials between EU member
states. There can be no assurance that any country that has price controls or reimbursement limitations for pharmaceutical products will
allow favorable reimbursement and pricing arrangements for any of our products. Historically, products launched in the U.K. and EU do
not follow price structures of the U.S. In the U.K. and EU, the downward pressure on healthcare costs in general, particularly prescription
medicines, has become intense. As a result, barriers to entry of new products are becoming increasingly high and patients are unlikely
to use a drug product that is not reimbursed by their government. We may face competition from lower-priced products in foreign countries
that have placed price controls on pharmaceutical products. In addition, the importation of foreign products may compete with any future
product that we may market, which could negatively impact our profitability.

 Specifically, in the U.S.,
we expect that the ACA, as well as other healthcare reform measures that may be adopted in the future, may result in more rigorous coverage
criteria and in additional downward pressure on the price that we may receive for any approved product. There have been judicial challenges
to certain aspects of the ACA and numerous legislative attempts to repeal and/or replace the ACA in whole or in part, and we expect there
will be additional challenges and amendments to the ACA in the future. At this time, the full effect that the ACA will have on our business
in the future remains unclear. An expansion in the government's role in the U.S. healthcare industry may cause general downward
pressure on the prices of prescription drug products, lower reimbursements or any other product for which we obtain regulatory approval,
reduce product utilization and adversely affect our business and results of operations. Any reduction in reimbursement from Medicare
or other government programs may result in a similar reduction in payments from private payors. The implementation of cost containment
measures or other healthcare reforms may prevent us from being able to generate revenue, attain profitability, or commercialize any of
our future product candidates for which we may receive regulatory approval.

 Information obtained
from expanded access studies may not reliably predict the efficacy of our future product candidates in company-sponsored clinical trials
and may lead to adverse events that could limit approval.

 The expanded access studies
we are currently supporting are uncontrolled, carried out by individual investigators and not typically conducted in strict compliance
with GCPs, all of which can lead to a treatment effect which may differ from that in placebo-controlled trials. These studies provide
only anecdotal evidence of efficacy for regulatory review. These studies contain no control or comparator group for reference and this
patient data is not designed to be aggregated or reported as study results. Moreover, data from such small numbers of patients may be
highly variable. Information obtained from these studies, including the statistical principles that we and the independent investigators
have chosen to apply to the data, may not reliably predict data collected via systematic evaluation of the efficacy in company-sponsored
clinical trials or evaluated via other statistical principles that may be applied in those trials. Reliance on such information to design
our clinical trials may lead to trials that are not adequately designed to demonstrate efficacy and could delay or prevent our ability
to seek approval of our future product candidates.

 Expanded access programs
provide supportive safety information for regulatory review. Physicians conducting these studies may use our future product candidates
in a manner inconsistent with the protocol, including in children with conditions beyond those being studied in trials which we sponsor.
Any adverse events or reactions experienced by subjects in the expanded access program may be attributed to our future product candidates
and may limit our ability to obtain regulatory approval with labeling that we consider desirable, or at all.

 There is a high rate
of failure for drug candidates proceeding through clinical trials.

 Generally, there is a high
rate of failure for drug candidates proceeding through clinical trials. We may suffer significant setbacks in our clinical trials similar
to the experience of a number of other companies in the pharmaceutical and biotechnology industries, even after receiving promising results
in earlier trials. Further, even if we view the results of a clinical trial to be positive, the FDA, MHRA or other regulatory authorities
may disagree with our interpretation of the data. In the event that we obtain negative results from clinical trials for product candidates
or other problems related to potential chemistry, manufacturing and control issues or other hurdles occur and our future product candidates
are not approved, we may not be able to generate sufficient revenue or obtain financing to continue our operations, our ability to execute
on our current business plan may be materially impaired, and our reputation in the industry and in the investment community might be
significantly damaged. In addition, our inability to properly design, commence and complete clinical trials may negatively impact the
timing and results of our clinical trials and ability to seek approvals for our drug candidates.

 If we are found in
violation of federal or state "fraud and abuse" laws or similar laws in other jurisdictions, we may be required to pay a
penalty and/or be suspended from participation in federal or state health care programs, which may adversely affect our business, financial
condition and results of operations.

 In the U.S., we are subject
to various federal and state health care "fraud and abuse" laws, including anti-kickback laws, false claims laws and other
laws intended to reduce fraud and abuse in federal and state health care programs, which could affect our company particularly upon successful
commercialization of our products in the U.S. The Medicare and Medicaid Patient Protection Act of 1987, or federal Anti-Kickback Statute,
makes it illegal for any person, including a prescription drug manufacturer (or a party acting on its behalf), to knowingly and willfully
solicit, receive, offer or pay any remuneration that is intended to induce the referral of business, including the purchase, order or
prescription of a particular drug for which payment may be made under a federal health care program, such as Medicare or Medicaid. Under
federal law, some arrangements, known as safe harbors, are deemed not to violate the federal Anti-Kickback Statute. Although we seek
to structure our business arrangements in compliance with all applicable requirements, it is often difficult to determine precisely how
the law will be applied in specific circumstances. Accordingly, it is possible that our practices may be challenged under the federal
Anti-Kickback Statute and Federal False Claims Act. Violations of fraud and abuse laws may be punishable by criminal and/or civil sanctions,
including fines and/or exclusion or suspension from federal and state health care programs such as Medicare and Medicaid and debarment
from contracting with the U.S. government. In addition, private individuals have the ability to bring actions on behalf of the government
under the federal False Claims Act as well as under the false claims laws of several states.

 While we believe that we
have structured our business arrangements to comply with these laws, the government could allege violations of, or convict us of violating,
these laws. If we are found in violation of one of these laws, we could be required to pay a penalty and could be suspended or excluded
from participation in federal or state health care programs, and our business, results of operations and financial condition may be adversely
affected.

 The Member States of the
EU and other countries also have anti-kickback laws and can impose penalties in case of infringement, which, in some jurisdictions, can
also be enforced by competitors.

 Serious adverse events
or other safety risks could require us to abandon development and preclude, delay or limit approval of our future product candidates,
limit the scope of any approved label or market acceptance, or cause the recall or loss of marketing approval of products that are already
marketed.

 If any of our future product
candidates prior to or after any approval for commercial sale, cause serious or unexpected side effects, or are associated with other
safety risks such as misuse, abuse or diversion, a number of potentially significant negative consequences could result, including:

 regulatory authorities may interrupt, delay or halt clinical trials;

 regulatory authorities may deny regulatory approval of our future product candidates;

 regulatory authorities may require certain labeling statements, such as warnings
 or contraindications or limitations on the indications for use, and/or impose restrictions on distribution in the form of a REMS
 in connection with approval or post-approval;

 regulatory authorities may withdraw their
 approval, require more onerous labeling statements, impose more restrictive REMS, or require us to recall any product that is
 approved;

 we may be required to change the way the product is administered or conduct additional
 clinical trials;

 our relationships with our collaboration partners may suffer;

 we could be sued and held liable for harm caused to patients; or

 our reputation may suffer. The reputational risk is heightened with respect to those
 of our future product candidates that are being developed for pediatric indications.

 We may voluntarily suspend
or terminate our clinical trials if at any time we believe that the products present an unacceptable risk to participants, or if preliminary
data demonstrates that our future product candidates are unlikely to receive regulatory approval or unlikely to be successfully commercialized.
Following receipt of approval for commercial sale of a product, we may voluntarily withdraw or recall that product from the market if
at any time we believe that its use, or a person's exposure to it, may cause adverse health consequences or death. To date, we
have not withdrawn, recalled or taken any other action, voluntary or mandatory, to remove an approved product from the market, have not
received approval for any products, and have not marketed any approved product. In addition, regulatory agencies, IRBs or data safety
monitoring boards may at any time recommend the temporary or permanent discontinuation of our clinical trials or request that we cease
using investigators in the clinical trials if they believe that the clinical trials are not being conducted in accordance with applicable
regulatory requirements, or that they present an unacceptable safety risk to participants. Although we have never been asked by a regulatory
agency, IRB or data safety monitoring board to temporarily or permanently discontinue a clinical trial, if we elect or are forced to
suspend or terminate a clinical trial of any of our future product candidates, the commercial prospects for that product will be harmed
and our ability to generate product revenue from that product may be delayed or eliminated. Furthermore, any of these events may result
in labeling statements such as warnings or contraindications. In addition, such events or labeling could prevent us or our partners from
achieving or maintaining market acceptance of the affected product and could substantially increase the costs of commercializing our
future product candidates and impair our ability to generate revenue from the commercialization of these products either by our company
or by our collaboration partners.

 The development of
REMS for our future product candidates could cause delays in the approval process and would add additional layers of regulatory requirements
that could impact our ability to commercialize our future product candidates in the U.S. and reduce their market potential.

 Even if the FDA approves
our NDA for any of our future product candidates without requiring a REMS as a condition of approval of the NDA, the FDA may, post-approval,
require a REMS for any of our future product candidates if it becomes aware of new safety information that makes a REMS necessary to
ensure that the benefits of the drug outweigh the potential risks. REMS elements can include medication guides, communication plans for
health care professionals, and elements to assure safe use (" ETASU "). ETASU can include, but are not limited to, special
training or certification for prescribing or dispensing, dispensing only under certain circumstances, special monitoring and the use
of patient registries. Moreover, product approval may require substantial post-approval testing and surveillance to monitor the drug's
safety or efficacy. We may be required to adopt a REMS for our future product candidates to ensure that the benefits outweigh the risks
of abuse, misuse, diversion and other potential safety concerns. There can be no assurance that the FDA will approve a manageable REMS
for our future product candidates, which could create material and significant limits on our ability to successfully commercialize our
future product candidates in the U.S. Delays in the REMS approval process could result in delays in the NDA approval process. In addition,
as part of the REMS, the FDA could require significant restrictions, such as restrictions on the prescription, distribution and patient
use of the product, which could significantly impact our ability to effectively commercialize our future product candidates, and dramatically
reduce their market potential, thereby adversely impacting our business, financial condition and results of operations. Even if initial
REMS are not highly restrictive, if, after launch, our future product candidates were to be subject to significant abuse/non-medical
use or diversion from illicit channels, this could lead to negative regulatory consequences, including a more restrictive REMS.

 The regulatory approval
processes of the FDA and comparable foreign authorities are lengthy, time-consuming and inherently unpredictable, and if we are ultimately
unable to obtain regulatory approval for our product candidates, our business will be substantially harmed.

 We are not permitted to commercialize,
market, promote or sell any product candidate in the U.S. without obtaining regulatory approval from the FDA. Foreign regulatory authorities,
such as the EMA and MHRA, impose similar requirements. The time required to obtain approval by the FDA and comparable foreign authorities
is inherently unpredictable, but typically takes many years following the commencement of clinical trials and depends upon numerous factors,
including substantial discretion of the regulatory authorities. In addition, approval policies, regulations, or the type and amount of
clinical data necessary to gain approval may change during the course of a product candidate's clinical development and may vary
among jurisdictions. To date, we have not submitted an NDA to the FDA or similar drug approval submissions to comparable foreign regulatory
authorities for our most advanced product candidate for the early stage treatment of Dupuytren's Contracture, or any other product
candidate. We must complete additional preclinical studies and clinical trials to demonstrate the safety and efficacy of our product
candidates in humans before we will be able to obtain these approvals.

 Clinical testing is expensive,
difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome. We cannot guarantee that
any clinical trial design that we submit will be accepted by the FDA, MHRA or other comparable foreign regulatory authorities, or that
clinical trials will be conducted as planned or completed on schedule, if at all. The clinical development of our initial and potential
additional product candidates is susceptible to the risk of failure inherent at any stage of development, including failure to demonstrate
efficacy in a clinical trial or across a broad population of patients, the occurrence of adverse events that are severe or medically
or commercially unacceptable, failure to comply with protocols or applicable regulatory requirements, and determination by the FDA, MHRA
or any other comparable foreign regulatory authority that a product candidate may not continue development or is not approvable. It is
possible that even if any of our product candidates has a beneficial effect, that effect will not be detected during clinical evaluation
as a result of one or more of a variety of factors, including the size, duration, design, measurements, conduct or analysis of our clinical
trials. Conversely, as a result of the same factors, our clinical trials may indicate an apparent positive effect of such product candidate
that is greater than the actual positive effect, if any. Similarly, in our clinical trials, we may fail to detect toxicity of, or intolerability
caused by, such product candidate, or mistakenly believe that our product candidates are toxic or not well tolerated when that is not
in fact the case. Serious adverse events, or SAEs, or other adverse effects, as well as tolerability issues, could hinder or prevent
market acceptance of the product candidate at issue.

 Our current and future product
candidates could fail to receive regulatory approval for many reasons, including the following:

 the FDA, MHRA or other comparable foreign regulatory authorities may disagree as
 to the design or implementation of our clinical trials;

 we may be unable to demonstrate to the satisfaction of the FDA, MHRA or other comparable
 foreign regulatory authorities that a product candidate is safe and effective for our proposed indication;

 the results of clinical trials may not meet the level of statistical significance
 required by the FDA, MHRA or other comparable foreign regulatory authorities for approval;

 we may be unable to demonstrate that a product candidate's clinical and other
 benefits outweigh its safety risks;

 the FDA, MHRA or other comparable foreign regulatory authorities may disagree with
 our interpretation of data from clinical trials or preclinical studies;

 the data collected from clinical trials of our product candidates may not be sufficient
 to support the submission of an NDA to the FDA or other submission or to obtain regulatory approval in the United States, the European
 Union or elsewhere;

 the FDA, MHRA or other comparable foreign regulatory authorities may find deficiencies
 with the manufacturing processes of third-party manufacturers with which we contract for clinical and commercial supplies; and

 the approval policies or regulations of the FDA, MHRA or other comparable foreign
 regulatory authorities may significantly change in a manner rendering our clinical data insufficient for approval.

 This lengthy approval process
as well as the unpredictability of clinical trial results may result in us failing to obtain regulatory approval to market any product
candidate we develop, which would substantially harm our business, results of operations and prospects. The FDA, MHRA or other comparable
foreign authorities have substantial discretion in the approval process and determining when or whether regulatory approval will be granted
for any product candidate that we develop. Even if we believe the data collected from future clinical trials of our product candidates
are promising, such data may not be sufficient to support approval by the FDA or any other regulatory authority.

 In addition, even if we were
to obtain approval, regulatory authorities may approve any of our product candidates for fewer or more limited indications than we request,
may not approve the price we intend to charge for our products, may grant approval contingent on the performance of costly post-marketing
clinical trials, or may approve a product candidate with labeling that does not include the claims necessary or desirable for the successful
commercialization of that product candidate. Any of the foregoing scenarios could materially harm the commercial prospects for our product
candidates.

 Risks Related to our Reliance Upon Third Parties

 Our existing collaboration
arrangements with certain universities and any that we may enter into in the future with other partners may not be successful, which
could adversely affect our ability to develop and commercialize our future product candidates.

 We are seeking collaboration
arrangements with pharmaceutical or biotechnology companies for the development or commercialization of our future product candidates.
We may, with respect to our future product candidates, enter into new arrangements on a selective basis depending on the merits of retaining
commercialization rights for ourselves as compared to entering into selective collaboration arrangements with leading pharmaceutical
or biotechnology companies for each product candidate, both in the U.S. and internationally. To the extent that we decide to enter into
collaboration agreements, we will face significant competition in seeking appropriate collaborators and the terms of any collaboration
or other arrangements that we may establish may not be favorable to us.

 Any existing or future collaboration
that we enter into may not be successful. The success of our collaboration arrangements will depend heavily on the efforts and activities
of our collaborators. Collaborators generally have significant discretion in determining the efforts and resources that they will apply
to these collaborations. Disagreements between parties to a collaboration arrangement regarding development, intellectual property, regulatory
or commercialization matters, can lead to delays in the development process or commercialization of the applicable product candidate
and, in some cases, termination of the collaboration arrangement. These disagreements can be difficult to resolve if neither of the parties
has final decision-making authority. Any such termination or expiration could harm our business reputation and may adversely affect it
financially.

 We expect to depend
on a limited number of suppliers for materials and components in order to manufacture our future product candidates. The loss of these
suppliers, or their failure to supply us on a timely basis, could cause delays in our current and future capacity and adversely affect
our business.

 We expect to depend on a
limited number of suppliers for the materials and components required to manufacture our future product candidates. As a result, we may
not be able to obtain sufficient quantities of critical materials and components in the future. A delay or interruption by our suppliers
may also harm our business, results of operations and financial condition. In addition, the lead time needed to establish a relationship
with a new supplier can be lengthy, and we may experience delays in meeting demand in the event we must switch to a new supplier. The
time and effort to qualify for and, in some cases, obtain regulatory approval for a new supplier could result in additional costs, diversion
of resources or reduced manufacturing yields, any of which would negatively impact our operating results. Our dependence on single-source
suppliers exposes us to numerous risks, including the following: our suppliers may cease or reduce production or deliveries, they may
be subject to government investigations and regulatory actions that limit or prevent production capabilities for an extended period of
time, raise prices or renegotiate terms; our suppliers may become insolvent; we may be unable to locate a suitable replacement supplier
on acceptable terms or on a timely basis, or at all; and delays caused by supply issues may harm our reputation, frustrate our customers
and cause them to turn to our competitors for future needs.

 Risks Related to our Intellectual Property

 We may not be able
to adequately protect our future product candidates or our proprietary technology in the marketplace.

 Our success will depend,
in part, on our ability to obtain patents, protect our trade secrets and operate without infringing on the proprietary rights of others.
We rely upon a combination of patents, trade secret protection (i.e., know-how), and confidentiality agreements to protect the intellectual
property of our future product candidates. The strengths of patents in the pharmaceutical field involve complex legal and scientific
questions and can be uncertain. Where appropriate, we seek patent protection for certain aspects of our products and technology. Filing,
prosecuting and defending patents globally can be prohibitively expensive.

 Our policy is to look to
patent technologies with commercial potential in jurisdictions with significant commercial opportunities. However, patent protection
may not be available for some of the products or technology we are developing. If we must spend significant time and money protecting,
defending or enforcing our patents, designing around patents held by others or licensing, potentially for large fees, patents or other
proprietary rights held by others, our business, results of operations and financial condition may be harmed. We may not develop additional
proprietary products that are patentable. As of the date hereof, we have an extensive portfolio of patents, including many granted patents
and patents pending approval.

 The patent positions of pharmaceutical
products are complex and uncertain. The scope and extent of patent protection for our future product candidates are particularly uncertain.
Our future product candidates will be based on medicinal chemistry instead of cannabis plants. While we have sought patent protection,
where appropriate, directed to, among other things, composition-of-matter for its specific formulations, their methods of use, and methods
of manufacture, we do not have and will not be able to obtain composition of matter protection on these previously known CBD derivatives
per se. We anticipate that the products we develop in the future will be based upon synthetic compounds we may discover. Although we
have sought, and will continue to seek, patent protection in the U.S., Europe and other countries for our proprietary technologies, future
product candidates, their methods of use, and methods of manufacture, any or all of them may not be subject to effective patent protection.
If any of our products are approved and marketed for an indication for which we do not have an issued patent, our ability to use our
patents to prevent a competitor from commercializing a non-branded version of our commercial products for that non-patented indication
could be significantly impaired or even eliminated.

 Publication of information
related to our future product candidates by our company or others may prevent us from obtaining or enforcing patents relating to these
products and product candidates. Furthermore, others may independently develop similar products, may duplicate our products, or may design
around our patent rights. In addition, any of our issued patents may be opposed and/or declared invalid or unenforceable. If we fail
to adequately protect our intellectual property, we may face competition from companies who attempt to create a generic product to compete
with our future product candidates. We may also face competition from companies who develop a substantially similar product to our future
product candidates that is not covered by any of our patents.

 Many companies have encountered
significant problems in protecting, defending and enforcing intellectual property rights in foreign jurisdictions. The legal systems
of certain countries, particularly certain developing countries, do not favor the enforcement of patents and other intellectual property
rights, particularly those relating to pharmaceuticals, which could make it difficult for us to stop the infringement of our patents
or marketing of competing products in violation of our proprietary rights generally. Proceedings to enforce our patent rights in foreign
jurisdictions could result in substantial costs and divert our efforts and attention from other aspects of our business.

 If third parties claim
that intellectual property used by our company infringes upon their intellectual property, our operating profits could be adversely affected.

 There is a substantial amount
of litigation, both within and outside the U.S., involving patent and other intellectual property rights in the pharmaceutical industry.
We may, from time to time, be notified of claims that we are infringing upon patents, trademarks, copyrights or other intellectual property
rights owned by third parties, and we cannot provide assurances that other companies will not, in the future, pursue such infringement
claims against us, our commercial partners or any third-party proprietary technologies we have licensed. If we were found to infringe
upon a patent or other intellectual property right, or if we failed to obtain or renew a license under a patent or other intellectual
property right from a third party, or if a third party from whom we were licensing technologies was found to infringe upon a patent or
other intellectual property rights of another third party, we may be required to pay damages, including damages of up to three times
the damages found or assessed, if the infringement is found to be willful, suspend the manufacture of certain products or reengineer
or rebrand our products, if feasible, or we may be unable to enter certain new product markets. Any such claims could also be expensive
and time consuming to defend and divert management's attention and resources. Our competitive position could suffer as a result.
In addition, if we have declined or failed to enter into a valid non-disclosure or assignment agreement for any reason, we may not own
the invention or our intellectual property, and our products may not be adequately protected. Thus, we cannot guarantee that any of our
future product candidates, or our commercialization thereof, does not and will not infringe on any third party's intellectual property.

 If we are not able
to adequately prevent disclosure of trade secrets and other proprietary information, the value of our technology and products could be
significantly diminished.

 We rely on trade secrets
to protect our proprietary technologies, especially where we do not believe patent protection is appropriate or obtainable. However,
trade secrets are difficult to protect. We rely in part on confidentiality agreements with current and former employees, consultants,
outside scientific collaborators, sponsored researchers, contract manufacturers, vendors and other advisors to protect our trade secrets
and other proprietary information. These agreements may not effectively prevent disclosure of confidential information and may not provide
an adequate remedy in the event of unauthorized disclosure of confidential information. In addition, we cannot guarantee that we have
executed these agreements with each party that may have or have had access to our trade secrets. Any party with whom we or they have
executed such an agreement may breach that agreement and disclose our proprietary information, including our trade secrets, and we may
not be able to obtain adequate remedies for such breaches.

 Enforcing a claim that a
party illegally disclosed or misappropriated a trade secret is difficult, expensive and time-consuming, and the outcome is unpredictable.
Also, some courts inside and outside the U.S. are less willing or unwilling to protect trade secrets. If any of our trade secrets were
to be lawfully obtained or independently developed by a competitor, we would have no right to prevent them, or those to whom they disclose
such trade secrets, from using that technology or information to compete with us. If any of our trade secrets were to be disclosed to
or independently developed by a competitor or other third-party, our competitive position would be harmed.

 The expiration or loss
of patent protection may adversely affect our future revenues and operating earnings.

 We rely on patent, trademark,
trade secret and other intellectual property protection in the discovery, development, manufacturing and sale of our product candidates.
In particular, patent protection is important in the development and eventual commercialization of our product candidates. Patents covering
our product candidates normally provide market exclusivity, which is important in order to improve the probability that our product candidates
are able to become profitable.

 One of our patents relating
to our Fibrosis and anti-TNF program will expire in 2033; however, the majority of the patent portfolio has a longer lifespan. While
we are seeking additional patent coverage which may protect the technology underlying these patents, there can be no assurances that
such additional patent protection will be granted, or if granted, that these patents will not be infringed upon or otherwise held enforceable.
Even if we are successful in obtaining a patent, patents have a limited lifespan. In the U.S., the natural expiration of a utility patent
is generally 20 years after it is filed. Various extensions may be available; however, the life of a patent, and the protection it affords,
is limited. Without patent protection of our product candidates, we may be open to competition from generic versions of such methods
and compositions.

 If we do not obtain
protection under the Hatch-Waxman Amendments by extending the patent term, our business may be harmed.

 Our commercial success will
largely depend on our ability to obtain and maintain patent and other intellectual property in the U.S. and other countries with respect
to our product candidates. Given the amount of time required for the development, testing and regulatory review of new product candidates,
patents protecting our product candidates might expire before or shortly after such candidates begin to be commercialized. We expect
to seek extensions of patent terms in the U.S. and, if available, in other countries where we are prosecuting patents.

 Depending upon the timing,
duration and specifics of FDA marketing approval of our product candidates, one or more of our U.S. patents may be eligible for limited
patent term extension, or PTE, under the Drug Price Competition and Patent Term Restoration Act of 1984, referred to as the Hatch-Waxman
Amendments. The Hatch-Waxman Amendments permit a patent restoration term of up to five years beyond the normal expiration of the patent
as compensation for patent term lost during development and the FDA regulatory review process, which is limited to the approved indication
(and potentially additional indications approved during the period of extension) covered by the patent. This extension is limited
to only one patent that covers the approved product, the approved use of the product, or a method of manufacturing the product. However,
the applicable authorities, including the FDA and the USPTO in the U.S., and any equivalent regulatory authority in other countries,
may not agree with our assessment of whether such extensions are available, and may refuse to grant extensions to our patents, or may
grant more limited extensions than we request. We may not be granted an extension because of, for example, failing to apply within applicable
deadlines, failing to apply prior to expiration of relevant patents or otherwise failing to satisfy applicable requirements. Moreover,
the applicable time-period or the scope of patent protection afforded could be less than we request. Even if we are able to obtain an
extension, the patent term may still expire before or shortly after we receive FDA marketing approval. If we are unable to extend the
expiration date of our existing patents or obtain new patents with longer expiry dates, our competitors may be able to take advantage
of our investment in development and clinical trials by referencing our clinical and preclinical data to obtain approval of competing
products following our patent expiration and launch their product earlier than might otherwise be the case.

 Risks Related to Controlled Substances

 Controlled substance
legislation differs between countries, and legislation in certain countries may restrict or limit our ability to sell our future product
candidates.

 Most countries are parties
to the Single Convention on Narcotic Drugs 1961 and the Convention on Psychotropic Substances 1971, which governs international trade
and domestic control of narcotic substances, including cannabis extracts. Countries may interpret and implement their treaty obligations
in a way that creates a legal obstacle to us obtaining marketing approval for our future products in those countries. These countries
may not be willing or able to amend or otherwise modify their laws and regulations to permit our future products to be marketed, or achieving
such amendments to the laws and regulations may take a prolonged period of time. In that case, we would be unable to market our future
product candidates in those countries in the near future or perhaps at all.

 The product candidates
that we are developing may be subject to U.S. controlled substance laws and regulations and failure to comply with these laws and regulations,
or the cost of compliance with these laws and regulations, may adversely affect the results of our business operations, both during clinical
development and post approval, and our financial condition.

 The product candidates that
we are developing may contain controlled substances as defined in The United States Federal Controlled Substances Act of 1970 and the
CSA. Controlled substances that are pharmaceutical products are subject to a high degree of regulation under the CSA, which establishes,
among other things, certain registration, manufacturing quotas, security, recordkeeping, reporting, import, export and other requirements
administered by the DEA. The DEA classifies controlled substances into five schedules: Schedule I, II, III, IV or V substances. Schedule
I substances by definition have a high potential for abuse, no currently " accepted medical use " in the U.S., lack
accepted safety for use under medical supervision, and may not be prescribed, marketed or sold in the U.S. Pharmaceutical products approved
for use in the U.S. which contain a controlled substance are listed as Schedule II, III, IV or V, with Schedule II substances considered
to present the highest potential for abuse or dependence and Schedule V substances the lowest relative risk of abuse among such substances.

 While cannabis is a Schedule
I controlled substance, products approved for medical use in the U.S. that contain cannabis or cannabis extracts should be placed in
Schedules II-V, since approval by the FDA satisfies the " accepted medical use " requirement. If and when any of our
future product candidates receive FDA approval, the DEA will make a scheduling determination. If the FDA, the DEA or any foreign regulatory
authority determines that our future product candidates may have potential for abuse, it may require us to generate more clinical or
other data than we currently anticipate to establish whether or to what extent the substance has an abuse potential, which could increase
the cost and/or delay the launch of that product.

 Facilities conducting research,
manufacturing, distributing, importing or exporting, or dispensing controlled substances must be registered (licensed) to perform
these activities and have the security, control, recordkeeping, reporting and inventory mechanisms required by the DEA to prevent drug
loss and diversion. All these facilities must renew their registrations annually, except dispensing facilities, which must renew every
three years. The DEA conducts periodic inspections of certain registered establishments that handle controlled substances. Obtaining
the necessary registrations may result in delay of the importation, manufacturing or distribution of our future products. Furthermore,
failure to maintain compliance with the CSA, particularly non-compliance resulting in loss or diversion, can result in regulatory action
that could have a material adverse effect on our business, financial condition and results of operations. The DEA may seek civil penalties,
refuse to renew necessary registrations, or initiate proceedings to restrict, suspend or revoke those registrations. In certain circumstances,
violations could lead to criminal proceedings.

 Individual states have also
established controlled substance laws and regulations. Although state-controlled substances laws often mirror federal law, because the
states are separate jurisdictions, they may separately schedule our future product candidates as well. State scheduling may delay commercial
sale of any product for which we obtain federal regulatory approval and adverse scheduling could have a material adverse effect on the
commercial attractiveness of such product. We or our partners must also obtain separate state registrations, permits or licenses in order
to be able to obtain, handle, and distribute controlled substances for clinical trials or commercial sale, and failure to meet applicable
regulatory requirements could lead to enforcement and sanctions by the states in addition to those from the DEA or otherwise arising
under federal law.

 Because our products may
be controlled substances in the U.S., to conduct clinical trials in the U.S., each of our research sites must submit a research protocol
to the DEA and obtain and maintain a DEA researcher registration that will allow those sites to handle and dispense our products and
to obtain product from our importer. If the DEA delays or denies the grant of a research registration to one or more research sites,
the clinical trial could be significantly delayed, and we could lose clinical trial sites. The importer for the clinical trials must
also obtain an importer registration and an import permit for each import.

 The legislation on cannabis
in the EU differs among the member states, as this area is not yet fully harmonized. In Germany, for example, cannabis is regulated as
a controlled substance ( Bet ubungsmittel) and its handling requires specific authorization.

 The legalization and
use of medical and recreational cannabis in the U.S. and abroad may impact our business.

 There is a substantial amount
of change occurring in the U.S. regarding the use of medical and recreational cannabis products. While cannabis products not approved
by the FDA are Schedule I substances as defined under federal law, and their possession and use is not permitted according to federal
law (except for research purposes, under DEA registration), according to the website worldpoplulationreview.com, at least 38 states and
the District of Columbia have enacted state laws to enable possession and use of cannabis for medical purposes, and at least 19 states
and the District of Columbia for recreational purposes. The U.S. Farm Bill, which was passed in 2018, descheduled certain material derived
from hemp plants with extremely low THC content. Although our business is quite distinct from that of online and dispensary cannabis
companies, future legislation authorizing the sale, distribution, use, and insurance reimbursement of non-FDA approved cannabis products
could affect our business.

 Accounting Risks

 We have in the past,
and may in the future, impair long-lived assets and intangible assets, including goodwill and acquired in-process research and development.

 We review long-lived assets
and certain identifiable assets (including intangible assets) for impairment whenever circumstances and situations change such that
there is an indication that the carrying amounts may not be recovered. An impairment exists when the carrying value of the long-lived
or intangible asset (including goodwill and acquired in-process research and development) is not recoverable and exceeds its estimated
fair value. Goodwill represents the difference between the purchase price and the fair value of assets and liabilities acquired in a
business combination. We review goodwill yearly, or more frequently whenever circumstances and situations change such that there is an
indication that the carrying amounts may not be recovered, for impairment by initially considering qualitative factors to determine whether
it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill, as a basis for
determining whether it is necessary to perform a quantitative analysis. If it is determined that it is more likely than not that the
fair value of reporting unit is less than its carrying amount, a quantitative analysis is performed to identify goodwill impairment.

 Our publicly-traded stock
closed at $1,482.00 per share as of December 31, 2021; during 2022, the market value of our single reporting unit significantly declined.
As of March 31, 2022, June 30, 2022, September 30, 2022 and December 31, 2022, the market value of our publicly-traded stock fell to
$984.20, $322.24, $252.70 and $64.41, per share, respectively, and as such, we elected to conduct a quantitative analysis of goodwill
to assess for impairment as of September 30, 2022 and December 31, 2022. We determined the fair market value of our single reporting
unit and compared that value with the carrying amount of the reporting unit and determined that goodwill was impaired as of both measurement
dates. As of September 30, 2022 and December 31, 2022, the carrying value exceeded the fair market value by $18,872,850 and $14,674,428,
respectively. To recognize the impairment of goodwill, we recorded losses for these amounts at the end of the third and fourth quarters,
which appear as a loss on goodwill impairment of $33,547,278 on the income statement for the year ended December 31, 2022.

 Intangible assets and in-process
research and development (" IP R&D ") assets represent the fair value assigned to technologies that were acquired
on July 16, 2019 in connection with the Reorganization, which have not reached technological feasibility and have no alternative future
use. IP R&D assets are considered to be indefinite-lived until the completion or abandonment of the associated research and development
projects. During the period that the IP R&D assets are considered indefinite-lived, they are tested for impairment on an annual basis,
or more frequently if we become aware of any events occurring or changes in circumstances that indicate that the fair value of the IP
R&D assets are less than their carrying amounts. If and when development is complete, which generally occurs upon regulatory approval,
and we are able to commercialize products associated with the IP R&D assets, these assets are then deemed definite-lived and are
amortized based on their estimated useful lives at that point in time. If development is terminated or abandoned, we may record a full
or partial impairment charge related to the IP R&D assets, calculated as the excess of the carrying value of the IP R&D assets
over their estimated fair value.

 As of December 31, 2022,
the carrying amount of the IP R&D assets on the balance sheet was $12,405,084 (which consists of carrying value of $1,462,084 and
$10,943,000 related to the Company's CBR Pharma subsidiary and its 180 LP subsidiary, respectively). Per the valuation obtained
from a third party as of year-end, the fair market value of the Company's IP R&D assets was determined to be $9,063,000 (which
consists of fair market values of $0 and $9,063,000 related to the Company's CBR Pharma subsidiary and 180 LP subsidiary, respectively).
As of this measurement date, the carrying value of the CBR Pharma and 180 LP subsidiaries' assets exceeded their fair market values
by $1,462,084 and $1,880,000, respectively. As such, management determined that the consolidated IP R&D assets were impaired by $3,342,084,
and in order to recognize the impairment, the Company recorded a loss for this amount during the fourth quarter of 2022, which appears
as a loss on impairment of IP R&D assets on the income statement. This reduced the IP R&D asset balances of its CBR Pharma subsidiary
and its 180 LP subsidiary to zero and $9,063,000, respectively, as of December 31, 2022; the total consolidated IP R&D asset balance
is $9,063,000 after impairment.

 As of September 30, 2023,
the carrying amount of the IP R&D assets on the balance sheet was $9,063,000 (which consists of a balance related to the Company's
180 LP subsidiary); the Company typically assesses asset impairment on an annual basis unless a triggering event or other facts or circumstances
indicate that an evaluation should be performed at an earlier date. At the end of the third quarter of 2023, the Company assessed general
economic conditions, industry and market considerations, the Company's financial performance and all relevant legal, regulatory,
and political factors that might indicate the possibility of impairment and concluded that, when these factors were collectively evaluated,
it was likely that the asset was impaired. The Company recorded a loss in the amount of $9,063,000, which appeared as a loss on impairment
to IP R&D assets on the income statement for the three and nine months ended September 30, 2023. As of December 31, 2023, the balance
of the IP R&D assets on the balance sheet is $0.

 An impairment recognized
in one period may not be reversed in a subsequent period, even if the value of our common stock increases in the future. We have in the
past and could in the future incur additional impairments of long-lived assets and/or intangible assets, including acquired in-process
research and development and goodwill, which may be material.

 We have in the past,
and may in the future, identify material weaknesses in our disclosure controls and procedures and internal control over financial reporting.
If not remediated, our failure to establish and maintain effective disclosure controls and procedures and internal control over financial
reporting could result in material misstatements in our financial statements and a failure to meet our reporting and financial obligations,
each of which could have a material adverse effect on our financial condition and the trading price of our securities.

 A material weakness is a deficiency,
or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material
misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. Accordingly, a material
weakness increases the risk that the financial information we report contains material errors. A control deficiency exists when the design
or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent
or detect misstatements on a timely basis.

 Maintaining effective disclosure
controls and procedures and effective internal control over financial reporting are necessary for us to produce reliable financial statements
and we are committed to remediating our material weaknesses in such controls as promptly as possible. However, there can be no assurance
as to when these material weaknesses will be remediated or that additional material weaknesses will not arise in the future. Any failure
to remediate the material weaknesses, or the development of new material weaknesses in our internal control over financial reporting,
could result in material misstatements in our financial statements and cause us to fail to meet our reporting and financial obligations
on a timely and accurate basis. If our financial statements are not accurate, investors may not have a complete understanding of our operations
or may lose confidence in our reported financial information. Likewise, if our financial statements are not filed on a timely basis as
required by the SEC and Nasdaq, we could face severe consequences from those authorities. Any of these cases could result in a material
adverse effect on our business, on our financial condition or have a negative effect on the trading price of our common stock and warrants.
Further, if we fail to remedy any future deficiencies or maintain the adequacy of our disclosure controls and procedures and our internal
controls, we could be subject to regulatory scrutiny, civil or criminal penalties or stockholder litigation against us or our management.

 We can give no assurance that
the measures we would take in the future will remediate any additional material weaknesses which could be identified, or restatements
of our financial statements will not arise in the future due to a failure to implement and maintain adequate internal control over financial
reporting or circumvention of those controls.

 Further, in the future, if
we cannot conclude that we have effective internal control over our financial reporting, or if our independent registered public accounting
firm is unable to provide an unqualified opinion regarding the effectiveness of our internal control over financial reporting (to the
extent we may be required in the future), investors could lose confidence in the reliability of our financial statements, which could
lead to a decline in our stock price. Failure to comply with reporting requirements could also subject us to sanctions and/or investigations
by the SEC or Nasdaq, as applicable, or other regulatory authorities.

 In addition, even if we would
be successful in strengthening our controls and procedures, those controls and procedures may not be adequate to prevent or identify
irregularities or facilitate the fair presentation of our financial statements or our periodic reports filed with the SEC. This may require
us to restate prior financial statements.

 We may experience adverse
impacts on our reported results of operations as a result of adopting new accounting standards or interpretations.

 Our implementation of and
compliance with changes in accounting rules, including new accounting rules and interpretations, could adversely affect our reported
financial position or operating results or cause unanticipated fluctuations in our reported operating results in future periods.

 Risks Related to our Common Stock and Warrants

 The market price of
our common stock has been extremely volatile and may continue to be volatile due to numerous circumstances beyond our control.

 The market price of our common
stock has fluctuated, and may continue to fluctuate, widely, due to many factors, some of which may be beyond our control. These factors
include, without limitation:

 "short squeezes";

 comments by securities analysts or other third parties, including blogs, articles,
 message boards and social and other media;

 large stockholders exiting their position in our securities or an increase or decrease
 in the short interest in our securities;

 actual or anticipated fluctuations in our financial and operating results;

 changes in foreign currency exchange rates;

 the commencement, enrollment or results of our planned or future clinical trials
 of our product candidates or those of our competitors;

 the success of competitive drugs or therapies;

 regulatory or legal developments in the U.S. and other countries;

 the success of competitive products or technologies;

 developments or disputes concerning patent applications, issued patents or other
 proprietary rights;

 the recruitment or departure of key personnel;

 the level of expenses related to our product candidates or clinical development
 programs;

 litigation matters, including amounts which may or may not be recoverable pursuant
 to our officer and director insurance policies, regulatory actions affecting the Company and the outcome thereof;

 the results of our efforts to discover, develop, acquire or in-license additional
 product candidates;

 actual or anticipated changes in estimates as to financial results, development
 timelines or recommendations by securities analysts;

 our inability to obtain or delays in obtaining adequate drug supply for any approved
 drug or inability to do so at acceptable prices;

 disputes or other developments relating to proprietary rights, including patents,
 litigation matters and our ability to obtain patent protection for our technologies;

 significant lawsuits, including patent or stockholder litigation;

 variations in our financial results or those of companies that are perceived to
 be similar to us;

 changes in the structure of healthcare payment systems, including coverage and adequate
 reimbursement for any approved drug;

 market conditions in the pharmaceutical and biotechnology sectors;

 general economic, political, and market conditions and overall fluctuations in the
 financial markets in the U.S. and abroad; and

 investors' general perception of us and our business.

 Stock markets in general and
our stock price in particular have recently experienced extreme price and volume fluctuations that have often been unrelated or disproportionate
to the operating performance of those companies and our company. For example, during 2022, the closing sales prices of our common stock
ranged from a post-split adjusted high of $1,482.04 per share to a low of $23.56 per share and during fiscal 2023, the closing sales prices
of our common stock ranged from a high of $100.70 per share to a low of $3.21 per share. During this time, we do not believe that we have
experienced any material changes in our financial condition or results of operations that would explain such price volatility or trading
volume; however, we have sold equity which was dilutive to existing stockholders. These broad market fluctuations may adversely affect
the trading price of our securities. Additionally, these and other external factors have caused and may continue to cause the market price
and demand for our common stock to fluctuate substantially, which may limit or prevent our stockholders from readily selling their shares
of our common stock and may otherwise negatively affect the liquidity of our common stock.

 Information available
in public media that is published by third parties, including blogs, articles, message boards and social and other media may include
statements not attributable to us and may not be reliable or accurate.

 We are aware of a large volume
of information being disseminated by third parties relating to our operations, including in blogs, message boards and social and other
media. Such information as reported by third parties may not be accurate, may lead to significant volatility in our securities and may
ultimately result in our common stock or other securities declining in value.

 The exercise of our
outstanding options and warrants, and the sale of common stock upon exercise thereof, may adversely affect the trading price of our securities.

 As of March 20, 2024, we had
(i) outstanding stock options to purchase an aggregate of 17,788 shares of common stock at a weighted average exercise price of $633.95
per share; and (ii) outstanding warrants to purchase 983,473 shares of common stock at a weighted average exercise price of $83.97
per share (when not including the 275,205 pre-funded warrants). For the life of the options and warrants, the holders have the opportunity
to profit from a rise in the market price of our common stock without assuming the risk of ownership. The issuance of shares upon the
exercise of outstanding securities will also dilute the ownership interests of our existing stockholders.

 The availability of these
shares for public resale, as well as any actual resales of these shares, could adversely affect the trading price of our common stock.
We cannot predict the size of future issuances of our common stock pursuant to the exercise of outstanding options or warrants or conversion
of other securities, or the effect, if any, that future issuances and sales of shares of our common stock may have on the market price
of our common stock. Sales or distributions of substantial amounts of our common stock (including shares issued in connection with an
acquisition), or the perception that such sales could occur, may cause the market price of our common stock to decline.

 In addition, the common stock
issuable upon exercise/conversion of outstanding convertible securities may represent overhang that may also adversely affect the market
price of our common stock. Overhang occurs when there is a greater supply of a company's stock in the market than there is demand
for that stock. When this happens the price of our stock will decrease, and any additional shares which stockholders attempt to sell
in the market will only further decrease the share price. If the share volume of our common stock cannot absorb shares sold by holders
of our outstanding convertible securities, then the value of our common stock will likely decrease.

 Our outstanding public
warrants are significantly out of the money.

 Each Public Warrant entitles the holder to purchase one-seven hundred
sixtieth of one share of common stock at an exercise price of $5.75 per 1/760 th of one share ($4,370.00 per whole share),
subject to adjustment. No fractional shares will be issued upon exercise of the Public Warrants. The Public Warrants became exercisable
12 months from the closing of the IPO and expire five years after the completion of the Business Combination (November 6, 2025). The Public
Warrants are significantly out of the money and because no fractional shares will be issued upon exercise of the Public Warrants, the
Public Warrants are only exercisable in multiples of 760. As a result, the Public Warrants may not have any significant value. Additionally,
warrant holders not holding at least 760 Public Warrants or who hold Public Warrants which would be exercisable for a fractional share
of common stock, must sell any warrants to obtain value from the fractional interest. As a result, the trading of the Public Warrants
may be limited or sporadic, and such Public Warrants may not have any significant value. Any holder of Public Warrants holding less than
760 Public Warrants or a number of Public Warrants not evenly divisible by 760 will not receive any common stock upon the exercise of
Public Warrants, as no fractional shares of common stock are issuable upon exercise thereof.

 A significant number
of our shares are eligible for sale and their sale or potential sale may depress the market price of our common stock and cause significant
dilution to existing stockholders.

 Sales of a significant number
of shares of our common stock in the public market could harm the market price of our common stock. Most of our common stock is available
for immediate resale in the public market, including (a) options to purchase 17,788 shares of common stock with a weighted average
exercise price of $633.95 per share; and (b) warrants to purchase 987,473 shares of common stock with a weighted average exercise
price of $83.97 per share (such amount does not include 257,205 pre-funded warrants which were outstanding as of December 31, 2023, all
of which have been exercised as of March 7, 2024). If a significant number of shares were sold, such sales would increase the supply of
our common stock, thereby potentially causing a decrease in its price. The exercise of outstanding convertible securities will also cause
significant dilution to existing stockholders and will likely cause the per-share value of our common stock to decline, possibly significantly.
Some or all of our shares of common stock may be offered from time to time in the open market pursuant to effective registration statements
and/or compliance with Rule 144, which sales could have a depressive effect on the market for our shares of common stock. Subject
to certain restrictions, a person who has held restricted shares for a period of six months may generally sell common stock into the market.
The sale of a significant portion of such shares when such shares are eligible for public sale may cause the value of our common stock
to decline in value.

 There may not be sufficient
liquidity in the market for our securities in order for investors to sell their shares. The market price of our common stock may continue
to be volatile.

 The market price of our common
stock will likely continue to be highly volatile. Some of the factors that may materially affect the market price of our common stock
are beyond our control, such as conditions or trends in the industry in which we operate or sales of our common stock. This situation
is attributable to a number of factors, including the fact that we are a small company which is relatively unknown to stock analysts,
stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even
if we came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven company such as
ours or purchase or recommend the purchase of our shares until such time as we became more seasoned and viable.

 As a consequence, there may
be periods of several days or more when trading activity in our shares is minimal or non-existent, as compared to a mature issuer which
has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on share price.
It is possible that a broader or more active public trading market for our common stock will not develop or be sustained, or that trading
levels will not continue. These factors may materially adversely affect the market price of our common stock, regardless of our performance.
In addition, the public stock markets have experienced extreme price and trading volume volatility. This volatility has significantly
affected the market prices of securities of many companies for reasons frequently unrelated to the operating performance of the specific
companies. These broad market fluctuations may adversely affect the market price of our common stock.

 We face significant
penalties and damages in the event registration statements we have previously filed to register certain securities sold in our prior
offerings are subsequently suspended or terminated.

 Pursuant to certain prior
private offerings of securities, we entered into registration rights agreements which required us to file certain registration statements
to register the resale of the privately sold shares and certain securities issuable upon exercise/conversion thereof, and to maintain
the effectiveness of such registration statements for certain periods of time. To date, all such required registration statements have
been declared effective by the SEC. However, in the event the registration statements are subsequently suspended or terminated, or we
otherwise fail to meet certain requirements set forth in the registration rights agreements, we could be required to pay significant
penalties which could adversely affect our cash flow and cause the value of our securities to decline in value.

 Provisions of certain
outstanding warrants could discourage an acquisition of us by a third party.

 Provisions of certain outstanding
warrants could make it more difficult or expensive for a third party to acquire us. Certain outstanding warrants prohibit us from engaging
in certain transactions constituting "fundamental transactions" unless, among other things, the surviving entity assumes
our obligations under each of the outstanding warrants issued in connection with the July 2022 Offering, the December 2022 Offering,
the April 2023 Offering and August 2023 Offering (each as defined and/or discussed herein), and the outstanding December 2023 Pre-Funded
Warrants and December 2023 Common Warrants, respectively. Further, such outstanding warrants provide that, in the event of certain transactions
constituting "fundamental transactions," with some exception, holders of such warrants will have the right, at their option,
to require us to repurchase such warrants at a price described in the applicable warrants (based on the Black Scholes Value of such warrants).
These and other provisions of the warrants could prevent or deter a third party from acquiring us even where the acquisition could be
beneficial to stockholders.

 Future sales and issuances
of our common stock or rights to purchase common stock, could result in additional dilution to our stockholders and could cause the price
of our common stock to decline.

 We may issue additional common
stock, convertible securities, or other equity in the future. We also issue common stock to our employees, directors, and other service
providers pursuant to our equity incentive plans. Such issuances could be dilutive to investors and could cause the price of our common
stock to decline. New investors in such issuances could also receive rights senior to those of current stockholders.

 Resales of our common
stock in the public market may cause the market price of our common stock to fall.

 Sales of a substantial number
of shares of our common stock could occur at any time. The issuance of new shares of our common stock could result in resales of our
common stock by our current stockholders concerned about the potential ownership dilution of their holdings. In turn, these resales could
have the effect of depressing the market price for our common stock.

 Future sales of our
common stock could cause our stock price to decline.

 If our stockholders sell
substantial amounts of our common stock in the public market, the market price of our common stock could decrease significantly. The
perception in the public market that our stockholders might sell shares of our common stock could also depress the market price of our
common stock. Up to $125,000,000 in total aggregate value of securities have been registered by us on a " shelf " registration
statement on Form S-3 that we filed with the Commission on June 3, 2022, and which was declared effective on June 24, 2022. However,
as of the date of this Report, our public float was less than $75 million, and under SEC regulations for so long as our public float
remains less than $75 million, the amount we can raise through primary public offerings of securities in any twelve-month period using
our shelf registration statement on Form S-3 is limited to an aggregate of one-third of our public float. At such time as our public
float again exceeds $75 million, the number of securities we may sell under a Form S-3 registration statement will no longer be limited
by such rules. Additionally, if our existing stockholders sell, or indicate an intention to sell, substantial amounts of our common stock
in the public market, the trading price of our common stock could decline significantly. The market price for shares of our common stock
may drop significantly when such securities are sold in the public markets. A decline in the price of shares of our common stock might
impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities.

 Risks Associated with Our Governing Documents and Delaware Law

 Our Certificate of
Incorporation provides for indemnification of officers and directors at our expense and limits their liability, which may result in a
major cost to us and hurt the interests of our stockholders because corporate resources may be expended for the benefit of officers or
directors.

 Our Certificate of Incorporation
provides for indemnification as follows: "To the fullest extent permitted by applicable law, the Corporation is authorized to provide
indemnification of, and advancement of expenses to, such agents of the Corporation (and any other persons to which Delaware law permits
the Corporation to provide indemnification) through Bylaw provisions, agreements with such agents or other persons, vote of stockholders
or disinterested directors or otherwise, in excess of the indemnification and advancement otherwise permitted by Section 145 of the Delaware
General Corporation Law, subject only to limits created by applicable Delaware law (statutory or non-statutory), with respect to actions
for breach of duty to the Corporation, its stockholders and others."

 We have been advised
that, in the opinion of the SEC, indemnification for liabilities arising under federal securities laws is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification for liabilities
arising under federal securities laws, other than the payment by us of expenses incurred or paid by a director, officer or
controlling person in the successful defense of any action, suit or proceeding, is asserted by a director, officer or controlling
person in connection with our activities, we will (unless in the opinion of our counsel, the matter has been settled by controlling
precedent) submit to a court of appropriate jurisdiction, the question whether indemnification by us is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue. The legal process relating to this
matter if it were to occur is likely to be very costly and may result in us receiving negative publicity, either of which factors is
likely to materially reduce the market and price for our shares.

 Our Certificate of
Incorporation contains a specific provision that limits the liability of our directors for monetary damages to us and our stockholders
and requires us, under certain circumstances, to indemnify officers, directors and employees.

 The limitation of monetary
liability against our directors, officers and employees under Delaware law and the existence of indemnification rights to them may result
in substantial expenditures by us and may discourage lawsuits against our directors, officers and employees.

 Our Certificate of Incorporation
contains a specific provision that limits the liability of our directors for monetary damages to us and our stockholders. We also have
contractual indemnification obligations under our employment and engagement agreements with our executive officers and directors. The
foregoing indemnification obligations could result in us incurring substantial expenditures to cover the cost of settlement or damage
awards against our directors and officers, which we may be unable to recoup. These provisions and resultant costs may also discourage
us from bringing a lawsuit against our directors and officers for breaches of their fiduciary duties and may similarly discourage the
filing of derivative litigation by our stockholders against our directors and officers, even though such actions, if successful, might
otherwise benefit us and our stockholders.

 Our directors have
the right to authorize the issuance of shares of preferred stock and additional shares of our common stock.

 Our directors, within the
limitations and restrictions contained in our Certificate of Incorporation and without further action by our stockholders, have the authority
to issue shares of preferred stock from time to time in one or more series and to fix the number of shares and the relative rights, conversion
rights, voting rights, and terms of redemption, liquidation preferences and any other preferences, special rights and qualifications
of any such series. Any issuance of shares of preferred stock could adversely affect the rights of holders of our common stock. Should
we issue additional shares of our common stock at a later time, each investor's ownership interest in our stock would be proportionally
reduced.

 Anti-takeover provisions
in our Second Amended and Restated Certificate of Incorporation, as amended, and our Second Amended and Restated Bylaws, as well as provisions
of Delaware law, might discourage, delay or prevent a change in control of our company or changes in our management and, therefore, depress
the trading price of our common stock.

 Our Second Amended and Restated
Certificate of Incorporation, as amended and our Second Amended and Restated Bylaws and Delaware law contain provisions that may discourage,
delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in
which you might otherwise receive a premium for your shares of our common stock or warrants. These provisions may also prevent or delay
attempts by our stockholders to replace or remove our management. Our corporate governance documents include the following provisions:

 a classified board of directors, as a result of which our Board is divided
 into two classes, with each class serving for staggered two-year terms;

 the removal of directors only for cause;

 requiring advance notice of stockholder proposals for business to be
 conducted at meetings of our stockholders and for nominations of candidates for election to our Board;

 prohibiting stockholders' ability to take action via written consents
 to action;

 providing that a special meeting of stockholders may be called only
 by the Chairman of the Board, Chief Executive Officer, or the Board pursuant to a resolution adopted by a majority of the Board;

 authorizing blank check preferred stock, which could be issued with
 voting, liquidation, dividend and other rights superior to our common stock; and

 limiting the liability of, and providing indemnification to, our directors
 and officers.

 As a Delaware corporation,
we are also subject to provisions of Delaware law, including Section 203 of the Delaware General Corporation Law, which limits the ability
of stockholders holding shares representing more than 15% of the voting power of our outstanding voting stock from engaging in certain
business combinations with us. Any provision of our Second Amended and Restated Certificate of Incorporation, as amended or our Second
Amended and Restated Bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity
for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are
willing to pay for our common stock.

 The existence of the foregoing
provisions and anti-takeover measures could limit the price that investors might be willing to pay in the future for shares of our common
stock or warrants. They could also deter potential acquirers of our company, thereby reducing the likelihood that you could receive a
premium for your common stock or warrants in an acquisition.

 Our Second Amended
and Restated Certificate of Incorporation, as amended, contains exclusive forum provisions that may discourage lawsuits against us and
our directors and officers.

 Our Second Amended and Restated
Certificate of Incorporation, as amended provides that unless the corporation consents in writing to the selection of an alternative
forum, the Court of Chancery of the State of Delaware, will be the sole and exclusive forum for (i) any derivative action or proceeding
brought on behalf of us, (ii) any action asserting a claim for breach of a fiduciary duty owed by any current or former director,
officer, employee or stockholder of the Company to us or our stockholders, (iii) any action asserting a claim arising pursuant to
any provision of the Delaware General Corporation Law, our Second Amended and Restated Certificate of Incorporation or Bylaws, or (iv) any
action asserting a claim governed by the internal affairs doctrine.

 The choice of forum provision
in our Second Amended and Restated Certificate of Incorporation does not waive our compliance with our obligations under the federal
securities laws and the rules and regulations thereunder. Moreover, the provision does not apply to suits brought to enforce a duty or
liability created by the Exchange Act or by the Securities Act. Section 27 of the Exchange Act creates exclusive federal jurisdiction
over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder, and Section
22 of the Securities Act creates concurrent jurisdiction for federal and state courts with respect to suits brought to enforce a duty
or liability created by the Securities Act or the rules and regulations thereunder. Accordingly, both state and federal courts have jurisdiction
to entertain claims under the Securities Act.

 These exclusive forum provisions
may limit the ability of our stockholders to bring a claim in a judicial forum that such stockholders find favorable for disputes with
us or our directors or officers, which may discourage such lawsuits against us and our directors and officers. Alternatively, if a court
were to find one or more of these exclusive forum provisions inapplicable to, or unenforceable in respect of, one or more of the specified
types of actions or proceedings described above, we may incur additional costs associated with resolving such matters in other jurisdictions
or forums, which could materially and adversely affect our business, financial condition or results of operations.

 Our Second Amended
and Restated Certificate of Incorporation, as amended, contains provisions whereby we renounced any interest in any corporate opportunity
offered to any director or officer, subject to certain exceptions.

 Our Section Amended and Restated
Certificate of Incorporation, as amended, provides that to the extent allowed by law, the doctrine of corporate opportunity, or any other
analogous doctrine, does not apply with respect to us or any of our officers or directors, or any of their respective affiliates, and
that we renounce any expectancy that any of our directors or officers will offer any such corporate opportunity of which he or she may
become aware to us, except that the doctrine of corporate opportunity shall apply with respect to any of our directors or officers only
with respect to a corporate opportunity (i) that was offered to such person solely in his or her capacity as our director or officer,
(ii) that is one we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue, and
(iii) to the extent the director or officer is permitted to refer such opportunity to us without violating any legal obligation.

 Additionally, each of our
officers and directors presently has, and any of them in the future may have, additional fiduciary or contractual obligations to other
entities pursuant to which such officer or director may be required to present a business opportunity to such entity, subject to his
or her fiduciary duties under applicable law. Accordingly, there may arise conflicts of interest in whether to present a potential business
combination opportunity to our company. These conflicts may not be resolved in our favor. Our renouncement of corporate opportunities
may have a material adverse effect on our results of operations moving forward and/or create conflicts of interest or perceived conflicts
of interest which may have a material adverse effect on the value of our securities.

 Our directors allocate
their time to other businesses thereby causing conflicts of interest in their determination as to how much time to devote to our affairs.

 Our directors are not required
to, and do not, commit their full time to our affairs, and certain of our directors hold positions, including other directorships, with
other companies in the life sciences industry, which may result in a conflict of interest in allocating their time between our operations
and others which they provide services to. If our directors' other business affairs require them to devote substantial amounts
of time to such affairs in excess of their current commitment levels, it could limit their ability to devote time to our affairs which
may have a negative impact on our operations. Additionally, such persons may have conflicts of interest in allocating their time among
various business activities. These conflicts may not be resolved in our favor. Additionally, our directors, because of our corporate
opportunity waiver, discussed above, may choose to, or be required to, provide corporate opportunities to the other companies which they
are affiliated with. Actual or perceived conflicts of interest may have a material adverse effect on our results of operations which
may have a material adverse effect on the value of our securities.

 Compliance, Reporting and Listing Risks

 We incur significant
costs to ensure compliance with U.S. and Nasdaq reporting and corporate governance requirements.

 We incur significant costs
associated with our public company reporting requirements and with applicable U.S. and Nasdaq corporate governance requirements, including
requirements under the Sarbanes-Oxley Act of 2002 and other rules implemented by the SEC and Nasdaq. The rules of Nasdaq include requiring
us to maintain independent directors, comply with other corporate governance requirements and pay annual listing and stock issuance fees.
All of such SEC and Nasdaq obligations require a commitment of additional resources including, but not limited, to additional expenses,
and may result in the diversion of our senior management's time and attention from our day-to-day operations. We expect all of
these applicable rules and regulations to significantly increase our legal and financial compliance costs and to make some activities
more time consuming and costly. We also expect that these applicable rules and regulations may make it more difficult and more expensive
for us to obtain director and officer liability insurance and we may be required to accept reduced policy limits and coverage or incur
substantially higher costs to obtain the same or similar coverage. As a result, it may be more difficult for us to attract and retain
qualified individuals to serve on our Board or as executive officers.

 We incur increased
costs as a result of being a reporting company, and given our limited capital resources, such additional costs may have an adverse impact
on our profitability.

 We are an SEC-reporting company.
The rules and regulations under the Exchange Act require reporting companies to provide periodic reports with interactive data files,
EDGAR (Electronic Data Gathering, Analysis, and Retrieval) service providers. The engagement of such services can be costly, and
we may continue to incur additional losses, which may adversely affect our ability to continue as a going concern. In addition, the Sarbanes-Oxley
Act of 2002, as well as a variety of related rules implemented by the SEC, have required changes in corporate governance practices and
generally increased the disclosure requirements of public companies. For example, as a result of being a reporting company, we are required
to file periodic and current reports and other information with the SEC and we have adopted policies regarding disclosure controls and
procedures and regularly evaluate those controls and procedures.

 The additional costs we continue
to incur in connection with being a reporting company (expected to be several hundred thousand dollars per year) will continue to
further stretch our limited capital resources. Due to our limited resources, we have to allocate resources away from other productive
uses in order to continue to comply with our obligations as an SEC reporting company. Further, there is no guarantee that we will have
sufficient resources to continue to meet our reporting and filing obligations with the SEC as they come due.

 We are not in compliance
with the continued listing standards of Nasdaq, may not be able to comply with Nasdaq's continued listing standards in the future,
and as a result our common stock and warrants may be delisted from Nasdaq.

 Our common stock and Public
Warrants trade on Nasdaq under the symbols "ATNF" and " ATNFW, " respectively. Notwithstanding such listing,
there can be no assurance any broker will be interested in trading our securities. Therefore, it may be difficult to sell our securities
publicly. There is also no guarantee that we will be able to maintain our listings on Nasdaq for any period of time by perpetually satisfying
Nasdaq's continued listing requirements.

 On September 7, 2023, the
Company received written notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC ("Nasdaq") notifying
the Company that it is not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for
continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum
bid price of $1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists
if the deficiency continues for a period of thirty (30) consecutive business days. Based on the closing bid price of the Company's
common stock for the thirty (30) consecutive business days from July 26, 2023 to September 6, 2023, the Company no longer meets
the minimum bid price requirement.

 The notification letter stated
that the Company has 180 calendar days or until March 5, 2024, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance,
the bid price of the Company's common stock must have a closing bid price of at least $1.00 per share for a minimum of 10 consecutive
business days. If the Company does not regain compliance by March 5, 2024, an additional 180 days may be granted to regain compliance,
so long as the Company meets The Nasdaq Capital Market initial listing criteria (except for the bid price requirement) and notifies
Nasdaq in writing of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if
necessary. If the Company does not qualify for the second compliance period or fails to regain compliance during the second 180-day period,
the Company's common stock will be subject to delisting, at which point the Company would have an opportunity to appeal the delisting
determination to a Hearings Panel.

 The Company intends to monitor
the closing bid price of its common stock and may, if appropriate, consider implementing available options to regain compliance with the
minimum bid price requirement under the Nasdaq Listing Rules, including affecting a reverse stock split. The Company held a special stockholders'
meeting on February 16, 2024, to seek approval, for among other things, an amendment to our Second Amended and Restated Certificate of
Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares of our common stock, by a ratio of between
one-for-four to one-for-forty, inclusive, with the exact ratio to be set at a whole number to be determined by our Board of Directors
or a duly authorized committee thereof in its discretion, at any time after approval of the amendment and prior to February 16, 2025.
On February 16, 2024, the Company's Board of Directors authorized a reverse stock split of our issued and outstanding shares of
common stock in the amount of one-for-nineteen, which was effective on February 28, 2024. On March 13, 2024, the Company received a letter
from Nasdaq notifying the Company that it has regained full compliance with the minimum bid price for continued listing on Nasdaq, pursuant
to Nasdaq Listing Rule 5550(a)(2), because Nasdaq has determined that for 10 consecutive business days, the closing bid price of the Company's
common stock was at or above $1.00 per share.

 On October 11, 2023, the
Company received written notice from Nasdaq notifying the Company that it was not in compliance with the shareholder approval requirements
set forth in Nasdaq Listing Rule 5635(d), which require prior shareholder approval for transactions, other than public offerings, involving
the issuance of 20% or more of the pre-transaction shares outstanding at less than the applicable Minimum Price (as defined in Listing
Rule 5635(d)(1)(A)).

 The Staff's determination under Listing Rule 5635(d) relates
to the offering and issuance by the Company of an aggregate of: (i) 35,102 shares of the Company's common stock, at a price
of $12.35 per share, (ii) pre-funded warrants to purchase up to 207,814 shares of common stock, at a price of $12.3481 per pre-funded
warrant and (iii) warrants to purchase up to 242,915 shares of common stock. The offering price per share and associated common warrant
was $12.35 and the offering price per pre-funded warrant and associated common warrant was $12.3481.

 The Staff determined that
the offering was not a "public offering" for the purposes of Nasdaq's shareholder approval rules due to the type of
offering, a best efforts offering pursuant to a placement agency agreement, and the fact that one investor purchased 98% of the offering.
As a result, because the offering represented greater than 20% of the common stock outstanding and was priced below the Minimum Price,
the Staff determined that the Company was required to obtain prior shareholder approval under Listing Rule 5635(d).

 The October 11, 2023 letter
provided the Company 45 days to submit a plan to regain compliance. The plan of compliance was subsequently submitted by the Company
to Nasdaq on November 9, 2023, and on November 14, 2023, Nasdaq granted the Company an extension, until December 15, 2023, to complete
certain transactions set forth in the plan of compliance, in order to remedy its prior violation of Nasdaq rules as described in the
October 11, 2023 letter from Nasdaq.

 The Company undertook several
transactions in November and December 2023, including amending the terms of the warrants discussed above, to not be exercisable until
the Company's stockholders approve such issuance in accordance with the Nasdaq Listing Rules, in order to regain compliance with
Listing Rule 5635(d)(1)(A)).

 As a result of those transactions,
on December 14, 2023, Nasdaq provided the Company written notice that the Company has complied with the terms of the prior extension;
that the Company complies with Listing Rule 5635(d)(1)(A)); and that the matter is now closed.

 On November 15, 2023, the
Company received a letter from Nasdaq notifying the Company that it was not in compliance with the minimum stockholders' equity
requirement for continued listing on the Nasdaq Capital Market. Nasdaq Listing Rule 5550(b)(1) (the " Rule ") requires
companies listed on the Nasdaq Capital Market to maintain stockholders' equity of at least $2,500,000. In the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 2023, the Company reported a stockholders' deficit of ($149,327), which
is below the minimum stockholders' equity required for continued listing pursuant to the Rule. Additionally, the Company does not
meet the alternative Nasdaq continued listing standards under Nasdaq Listing Rules.

 Nasdaq provided the Company
until January 2, 2024 to submit to Nasdaq a plan to regain compliance. We submitted the plan to regain compliance in a timely manner,
and on January 11, 2024, Nasdaq advised the Company that it has determined to grant the Company an extension to regain compliance with
the Rule.

 The terms of the extension
are as follows: on or before May 13, 2024, the Company must complete certain transactions described in greater detail in the compliance
plan, contemplated to result in the Company increasing its stockholders' equity to more than $2.5 million, and opt for one of the
two following alternatives to evidence compliance with the Rule: Alternative 1: The Company must furnish to the SEC and Nasdaq a publicly
available report (e.g., a Form 8-K) including: 1. A disclosure of the Staff's deficiency letter and the specific deficiency(ies)
cited; 2. A description of the completed transaction or event that enabled the Company to satisfy the stockholders' equity requirement
for continued listing; and 3. An affirmative statement that, as of the date of the report, the Company believes it has regained compliance
with the stockholders' equity requirement based upon the specific transaction or event referenced in Step 2; or Alternative 2:
The Company must furnish to the SEC and Nasdaq a publicly available report including: 1. Steps 1 & 2 set forth above; 2. A balance
sheet no older than 60 days with pro forma adjustments for any significant transactions or event occurring on or before the report date;
and 3. That the Company believes it satisfies the stockholders' equity requirement as of the report date. The pro forma balance
sheet must evidence compliance with the stockholders' equity requirement.

 Additionally, in either case
the Company is required to disclose that Nasdaq will continue to monitor the Company's ongoing compliance with the stockholders'
equity requirement and, if at the time of its next periodic report the Company does not evidence compliance, that it may be subject to
delisting.

 Regardless of which alternative
the Company chooses, if the Company fails to evidence compliance upon filing its next periodic report with the SEC following the end
of such compliance period (i.e., its Quarterly Report for the Quarter ended June 30, 2024), the Company may be subject to delisting.
In the event the Company does not satisfy these terms, Nasdaq will provide written notification that its securities will be delisted.
At that time, the Company may appeal Nasdaq's determination to a Hearings Panel.

 The Company is currently
evaluating various courses of action to regain compliance and is hopeful that it can regain compliance with Nasdaq's minimum stockholders'
equity standard within the compliance period. However, there can be no assurance that the Company will be able to complete the transactions
contemplated in the compliance plan, which the Company expects will allow it to regain compliance with the Rule, or that such transactions
will result in the Company regaining compliance with the Rule, within the compliance period granted by Nasdaq, if at all.

 Among the conditions required
for continued listing on The Nasdaq Capital Market, Nasdaq requires us to maintain at least $2.5 million in stockholders' equity
or $500,000 in net income over the prior two years or two of the prior three years. As of December 31, 2023 and September 30, 2023, our
stockholders' equity was below $2.5 million and we did not otherwise meet the net income requirements described above, and as such,
we are not currently in compliance with Nasdaq's continue listing standards relating to minimum stockholders' equity. If
we fail to timely remedy our compliance with such applicable requirement, our common stock and Public Warrants may be delisted.

 Our failure to meet Nasdaq's
continued listing requirements for the reasons above, or any other reason, may result in our securities being delisted from Nasdaq.

 Additional conditions required for continued listing on Nasdaq include
requiring that we have a majority of independent directors, a two-person compensation committee and a three-member audit committee (each
consisting of all independent directors). As
a result, our common stock and Public Warrants may be delisted from Nasdaq.

 Even if we demonstrate compliance
with the requirements of Nasdaq, we will have to continue to meet other objective and subjective listing requirements to continue to
be listed on The Nasdaq Capital Market. Delisting from The Nasdaq Capital Market could make trading our common stock and Public Warrants
more difficult for investors, potentially leading to declines in our share price and liquidity. Without a Nasdaq Capital Market listing,
stockholders may have a difficult time getting a quote for the sale or purchase of our common stock and Public Warrants, the sale or
purchase of our common stock and Public Warrants would likely be made more difficult, and the trading volume and liquidity of our common
stock and Public Warrants could decline. Delisting from The Nasdaq Capital Market could also result in negative publicity and could also
make it more difficult for us to raise additional capital. The absence of such a listing may adversely affect the acceptance of our common
stock as currency or the value accorded by other parties. Further, if we are delisted, we would also incur additional costs under state
blue sky laws in connection with any sales of our securities. These requirements could severely limit the market liquidity of our common
stock and Public Warrants and the ability of our stockholders and warrant holders to sell our common stock and Public Warrants in the
secondary market. If our common stock and Public Warrants are delisted by Nasdaq, our common stock and Public Warrants may be eligible
to trade on an over-the-counter quotation system, such as the OTCQB Market or the OTC Pink market, where an investor may find it more
difficult to sell our common stock and Public Warrants or obtain accurate quotations as to the market value of our common stock and Public
Warrants. In the event our common stock and Public Warrants is delisted from The Nasdaq Capital Market, we may not be able to list our
common stock on another national securities exchange or obtain quotation on an over-the counter quotation system.

 General Risk Factors

 Provisions in our Certificate
of Incorporation and Delaware law may inhibit a takeover of us, which could limit the price investors might be willing to pay in the
future for our common stock and could entrench management.

 Our Certificate of Incorporation
contains provisions that may discourage unsolicited takeover proposals that stockholders may consider to be in their best interests.
These provisions include a staggered board of directors and the ability of our Board to designate the terms of and issue new series of
preferred shares, which may make it more difficult for the removal of management and may discourage transactions that otherwise could
involve payment of a premium over prevailing market prices for our securities. We are also subject to anti-takeover provisions under
Delaware law, which could delay or prevent a change of control of the Company. Together, these provisions may make it more difficult
for the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing market
prices for our securities.

 Our proprietary information,
or that of our customers, suppliers and business partners, may be lost or we may suffer security breaches.

 In the ordinary course of
our business, we expect to collect and store sensitive data, including valuable and commercially sensitive intellectual property, clinical
trial data, our proprietary business information and that of our future customers, suppliers and business partners, and personally identifiable
information of our customers, clinical trial subjects and employees, patients, in our data centers and on our networks. The secure processing,
maintenance and transmission of this information is critical to our operations. Despite our security measures, our information technology
and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance or other disruptions. Any such
breach could compromise our networks and the information stored there could be accessed, publicly disclosed, lost or stolen. Any such
access, disclosure or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy
of personal information, regulatory penalties, disrupt our operations, damage our reputation, and cause a loss of confidence in our products
and our ability to conduct clinical trials, which could adversely affect our business and reputation and lead to delays in gaining regulatory
approvals for our future product candidates. Although we maintain business interruption insurance coverage, our insurance might not cover
all losses from any future breaches of our systems.

 Failure of our information
technology systems, including cybersecurity attacks or other data security incidents, could significantly disrupt the operation of our
business.

 Our business increasingly
depends on the use of information technologies, which means that certain key areas such as research and development, production and sales
are to a large extent dependent on our information systems or those of third-party providers. Our ability to execute our business plan
and to comply with regulators' requirements with respect to data control and data integrity, depends, in part, on the continued
and uninterrupted performance of our information technology systems, or IT systems and the IT systems supplied by third-party service
providers. As information systems and the use of software and related applications by our company, our business partners, suppliers,
and customers become more cloud-based, there has been an increase in global cybersecurity vulnerabilities and threats, including more
sophisticated and targeted cyber-related attacks that pose a risk to the security of our information systems and networks and the confidentiality,
availability and integrity of data and information. In addition, our IT systems are vulnerable to damage from a variety of sources, including
telecommunications or network failures, malicious human acts and natural disasters. Moreover, despite network security and backup measures,
some of our servers are potentially vulnerable to physical or electronic break-ins, computer viruses and similar disruptive problems.
Despite the precautionary measures we and our third-party service providers have taken to prevent unanticipated problems that could affect
our IT systems, a successful cybersecurity attack or other data security incident could result in the misappropriation and/or loss of
confidential or personal information, create system interruptions, or deploy malicious software that attacks our systems. It is also
possible that a cybersecurity attack might not be noticed for some period of time. In addition, sustained or repeated system failures
or problems arising during the upgrade of any of our IT systems that interrupt our ability to generate and maintain data, and in particular
to operate our proprietary technology platform, could adversely affect our ability to operate our business. The occurrence of a cybersecurity
attack or incident could result in business interruptions from the disruption of our IT systems, or negative publicity resulting in reputational
damage with our stockholders and other stakeholders and/or increased costs to prevent, respond to or mitigate cybersecurity events. In
addition, the unauthorized dissemination of sensitive personal information or proprietary or confidential information could expose us
or other third–parties to regulatory fines or penalties, litigation and potential liability, or otherwise harm our business.

 We may acquire other
companies which could divert our management's attention, result in additional dilution to our stockholders and otherwise disrupt
our operations and harm our operating results.

 We may in the future seek
to acquire businesses, products or technologies that we believe could complement or expand our product offerings, enhance our technical
capabilities or otherwise offer growth opportunities. The pursuit of potential acquisitions may divert the attention of management and
cause us to incur various expenses in identifying, investigating and pursuing suitable acquisitions, whether or not they are consummated.
If we acquire additional businesses, we may not be able to integrate the acquired personnel, operations and technologies successfully,
effectively manage the combined business following the acquisition or realize anticipated cost savings or synergies. We also may not
achieve the anticipated benefits from the acquired business due to a number of factors, including:

 incurrence of acquisition-related costs;

 diversion of management's attention from other business concerns;

 unanticipated costs or liabilities associated with the acquisition;

 harm to our existing business relationships with collaboration partners
 as a result of the acquisition;

 harm to our brand and reputation;

 the potential loss of key employees;

 use of resources that are needed in other parts of our business; and

 use of substantial portions of our available cash to consummate the
 acquisition.

 In the future, if our acquisitions
do not yield expected returns, we may be required to take charges to our operating results arising from the impairment assessment process.
Acquisitions may also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our operating
results. In addition, if an acquired business fails to meet our expectations, our business, results of operations and financial condition
may be adversely affected.

 If we make any acquisitions,
they may disrupt or have a negative impact on our business.

 If we make acquisitions in
the future, funding permitting, which may not be available on favorable terms, if at all, we could have difficulty integrating the acquired
company's assets, personnel and operations with our own. We do not anticipate that any acquisitions or mergers we may enter into
in the future would result in a change of control of the Company. In addition, the key personnel of the acquired business may not be
willing to work for us. We cannot predict the effect expansion may have on our core business. Regardless of whether we are successful
in making an acquisition, the negotiations could disrupt our ongoing business, distract our management and employees and increase our
expenses. In addition to the risks described above, acquisitions are accompanied by a number of inherent risks, including, without limitation,
the following:

 the difficulty of integrating acquired products, services or operations;

 the potential disruption of the ongoing businesses and distraction of
 our management and the management of acquired companies;

 difficulties in maintaining uniform standards, controls, procedures
 and policies;

 the potential impairment of relationships with employees and customers
 as a result of any integration of new management personnel;

 the potential inability or failure to achieve additional sales and enhance
 our customer base through cross-marketing of the products to new and existing customers;

 the effect of any government regulations which relate to the business
 acquired;

 potential unknown liabilities associated with acquired businesses or
 product lines, or the need to spend significant amounts to retool, reposition or modify the marketing and sales of acquired products
 or operations, or the defense of any litigation, whether or not successful, resulting from actions of the acquired company prior
 to our acquisition; and

 potential expenses under the labor, environmental and other laws of
 various jurisdictions.

 Our business could be severely
impaired if and to the extent that we are unable to succeed in addressing any of these risks or other problems encountered in connection
with an acquisition, many of which cannot be presently identified. These risks and problems could disrupt our ongoing business, distract
our management and employees, increase our expenses and adversely affect our results of operations.

 We may apply working
capital and future funding to uses that ultimately do not improve our operating results or increase the value of our securities.

 In general, we have complete
discretion over the use of our working capital and any new investment capital we may obtain in the future. Because of the number and
variety of factors that could determine our use of funds, our ultimate expenditure of funds (and their uses) may vary substantially
from our current intended operating plan for such funds.

 We intend to use existing
working capital and future funding for research and development, and general corporate purposes, including the potential expenses related
to completing a reverse merger and legal expenses. We will also use capital for general working capital purposes. However, we do not
have more specific plans for the use and expenditure of our capital. Our management has broad discretion to use any or all of our available
capital reserves. Our capital could be applied in ways that do not improve our operating results or otherwise increase the value of a
stockholder's investment.

 We have never paid
or declared any dividends on our common stock.

 We have never paid or declared
any dividends on our common stock or preferred stock. Likewise, we do not anticipate paying, in the near future, dividends or distributions
on our common stock. Any future dividends on common stock will be declared at the discretion of our Board and will depend, among other
things, on our earnings, our financial requirements for future operations and growth, and other facts as we may then deem appropriate.
Since we do not anticipate paying cash dividends on our common stock, return on your investment, if any, will depend solely on an increase,
if any, in the market value of our common stock.

 Stockholders may be
diluted significantly through our efforts to obtain financing and satisfy obligations through the issuance of additional shares of our
common stock.

 Wherever possible, our Board
will attempt to use non-cash consideration to satisfy obligations. In many instances, we believe that the non-cash consideration will
consist of restricted shares of our common stock or where shares are to be issued to our officers, directors and applicable consultants.
Our Board of Directors has authority, without action or vote of the stockholders, but subject to Nasdaq rules and regulations (which
generally require stockholder approval for any transactions which would result in the issuance of more than 20% of our then outstanding
shares of common stock or voting rights representing over 20% of our then outstanding shares of stock, subject to certain exceptions),
to issue all or part of the authorized but unissued shares of common stock. In addition, we may attempt to raise capital by selling shares
of our common stock, possibly at a discount to market. These actions will result in dilution of the ownership interests of existing stockholders,
which may further dilute common stock book value, and that dilution may be material. Such issuances may also serve to enhance existing
management's ability to maintain control of the Company because the shares may be issued to parties or entities committed to supporting
existing management.

 Our growth depends in part on the success
of our strategic relationships with third parties.

 In order to grow our business,
we anticipate that we will need to continue to depend on our relationships with third parties, including our technology providers. Identifying
partners, and negotiating and documenting relationships with them, requires significant time and resources. Our competitors may be effective
in providing incentives to third parties to favor their products or services, or utilization of, our products and services. In addition,
acquisitions of our partners by our competitors could result in a decrease in the number of our current and potential customers. If we
are unsuccessful in establishing or maintaining our relationships with third parties, our ability to compete in the marketplace or to
grow our revenue could be impaired and our results of operations may suffer. Even if we are successful, we cannot assure you that these
relationships will result in increased customer use of our products or increased revenue.

 Claims, litigation,
government investigations, and other proceedings may adversely affect our business and results of operations.

 We are currently subject
to, and expect to continue to be regularly subject to, actual and threatened claims, litigation, reviews, investigations, and other proceedings.
In addition, we have filed lawsuits against certain parties for matters we discovered which related to KBL, prior to the Business Combination.
Any of these types of proceedings may have an adverse effect on us because of legal costs, disruption of our operations, diversion of
management resources, negative publicity, and other factors. Our current legal proceedings are described under, and incorporated by reference
in, "Item 3. Legal Proceedings". The outcomes of these matters are inherently unpredictable and subject to significant uncertainties.
Determining legal reserves and possible losses from such matters involves judgment and may not reflect the full range of uncertainties
and unpredictable outcomes. Until the final resolution of such matters, we may be exposed to losses in excess of the amount recorded,
and such amounts could be material. Should any of our estimates and assumptions change or prove to have been incorrect, it could have
a material effect on our business, consolidated financial position, results of operations, or cash flows. In addition, it is possible
that a resolution of one or more such proceedings, including as a result of a settlement, could require us to make substantial future
payments, prevent us from offering certain products or services, require us to change our business practices in a manner materially adverse
to our business, requiring development of non-infringing or otherwise altered products or technologies, damaging our reputation, or otherwise
having a material effect on our operations.

 Changes in laws or
regulations, or a failure to comply with any laws and regulations, may adversely affect our business, investments and results of operations.

 We are subject to laws, regulations
and rules enacted by national, regional and local governments. In particular, we are required to comply with certain SEC, Nasdaq and
other legal or regulatory requirements. Compliance with, and monitoring of, applicable laws, regulations and rules may be difficult,
time consuming and costly. Those laws, regulations and rules and their interpretation and application may also change from time to time
and those changes could have a material adverse effect on our business, investments and results of operations. In addition, a failure
to comply with applicable laws, regulations and rules, as interpreted and applied, could have a material adverse effect on our business
and results of operations.

 Certain of our executive
officers and directors are now, and all of them may in the future become, affiliated with entities engaged in business activities similar
to those conducted by us and, accordingly, may have conflicts of interest in determining to which entity a particular business opportunity
should be presented.

 Our executive officers and
directors are, or may in the future become, affiliated with entities that are engaged in business activities similar to those that are
conducted by us. Our officers and directors also may become aware of business opportunities which may be appropriate for presentation
to us and the other entities to which they owe certain fiduciary or contractual duties. Accordingly, they may have conflicts of interest
in determining whether a particular business opportunity should be presented to our company or to another entity. These conflicts may
not be resolved in our favor and a potential opportunity may be presented to another entity prior to its presentation to us. Our Certificate
of Incorporation provides that we renounce our interest in any corporate opportunity offered to any director or officer unless such opportunity
is expressly offered to such person solely in his or her capacity as a director or officer of our company and such opportunity is one
we are legally and contractually permitted to undertake and would otherwise be reasonable for us to pursue.

 Our executive officers,
directors, security holders and their respective affiliates may have competitive pecuniary interests that conflict with our interests.

 We have not adopted a policy
that expressly prohibits our directors, executive officers, security holders or affiliates from having a direct or indirect pecuniary
or financial interest in any investment to be acquired or disposed of by us or in any transaction to which we are a party or have an
interest. In fact, we may enter into a strategic transaction with a target business that is affiliated with our directors or executive
officers. Nor do we have a policy that expressly prohibits any such persons from engaging for their own account in business activities
of the types conducted by us. Accordingly, such persons or entities may have a conflict between their interests and ours. Certain of
our officers and directors hold positions with companies which may be competitors of us. See also the biographies of our officers and
directors incorporated by reference herein below under "Item 10. Directors, Executive Officers and Corporate Governance".

 Our business has been,
and may continue to be, adversely affected by the COVID-19 pandemic.

 In December 2019, a
novel strain of coronavirus (COVID-19) was reported to have surfaced in Wuhan, China. In January 2020, COVID-19 spread to other
parts of the word, including the U.S. and Europe, and efforts to contain its spread have intensified, with varying degrees of success.
As a result, businesses have closed and limits have been placed on travel and everyday activities. The extent to which COVID-19 may impact
our business will depend on future developments, which are highly uncertain and cannot be predicted with confidence, such as the duration
of the outbreak, travel restrictions and social distancing in the U.S. and other countries, business closures or business disruptions,
and the effectiveness of actions taken in the U.S. and other countries to contain and treat the disease. Should the COVID-19 pandemic
continue, our plans could be delayed or interrupted. The spread of COVID-19 has also created global economic uncertainty, which may cause
partners, suppliers and potential customers to closely monitor their costs and reduce their spending budget. The foregoing could materially
adversely affect the clinical trials, supply chain, financial condition and financial performance of our company.

 Enrollment of patients in
our clinical trials, maintaining patients in our ongoing clinical trials, doing follow up visits with recruited patients and collecting
data have been, and may continue to be, delayed or limited as certain of our clinical trial sites limit their onsite staff or temporarily
close as a result of the COVID-19 pandemic and ongoing government restrictions. In addition, patients may not be able or willing to visit
clinical trial sites for dosing or data collection purposes due to limitations on travel and physical distancing imposed or recommended
by federal or state governments or patients' reluctance to visit the clinical trial sites during the pandemic. These factors resulting
from the COVID-19 pandemic could delay or prevent the anticipated readouts from our clinical trials, which could ultimately delay or
prevent our ability to generate revenues and could have a material adverse effect on our results of operations. The foregoing could materially
adversely affect the clinical trials, supply chain, financial condition and financial performance of our company.

 Additionally, our Frozen
Shoulder trial has been adversely affected. The trial was opened to recruitment at the end of May 2022 following delays in gaining approvals
due to backlogs in the National Institute of Health Research (NIHR) system due to COVID-19 and consequential staff vacancies. Nine participants
were recruited for participation in the trial through mid-February 2023. The U.K. research system has faced unprecedented challenges
following the COVID-19 pandemic both in terms of support services and at the point of delivery of clinical care. This has resulted in
the NIHR instituting their Recovery and Reset program to identify and close trials that are facing challenges. Our Frozen Shoulder trial
was considered to be one of such trials, due to the considerable challenges we faced to open recruitment sites and enroll sufficient
participants. Therefore, the NIHR has asked the chief investigators to close the trial for further recruitment. This closure or future
closures or difficulties relating to the recruitment of participants in future studies could have a material adverse effect on our ability
to complete studies, the timeline for future drugs and our ability to generate revenues and support our operations.

 We may be adversely
affected by climate change or by legal, regulatory or market responses to such change.

 The long-term effects of
climate change are difficult to predict; however, such effects may be widespread. Impacts from climate change may include physical risks
(such as rising sea levels or frequency and severity of extreme weather conditions-which may affect our current operations due to among
other things, the fact that a majority of our operations we are based in California, which is prone to inclement weather), social and
human effects (such as population dislocations or harm to health and well-being), compliance costs and transition risks (such as regulatory
or technology changes) and other adverse effects. The effects of climate change could increase the cost of certain products, commodities
and energy (including utilities), which in turn may impact our ability to procure goods or services required for the operation of our
business. Climate change could also lead to increased costs as a result of physical damage to or destruction of our facilities, loss
of inventory, and business interruption due to weather events that may be attributable to climate change. These events and impacts could
materially adversely affect our business operations, financial position or results of operation.

 Environmental, social
and governance matters may impact our business and reputation.

 Governmental authorities,
non-governmental organizations, customers, investors, external stakeholders and employees are increasingly sensitive to environmental,
social and governance, or ESG, concerns, such as diversity and inclusion, climate change, water use, recyclability or recoverability
of packaging, and plastic waste. This focus on ESG concerns may lead to new requirements that could result in increased costs associated
with developing, manufacturing and distributing our products. Our ability to compete could also be affected by changing customer preferences
and requirements, such as growing demand for more environmentally friendly products, packaging or supplier practices, or by failure to
meet such customer expectations or demand. We risk negative stockholder reaction, including from proxy advisory services, as well as
damage to our brand and reputation, if we do not act responsibly, or if we are perceived to not be acting responsibly in key ESG areas,
including equitable access to medicines, product quality and safety, diversity and inclusion, environmental stewardship, support for
local communities, corporate governance and transparency, and addressing human capital factors in our operations. If we do not meet the
ESG expectations of our investors, customers and other stakeholders, we could experience reduced demand for our products, loss of customers,
and other negative impacts on our business and results of operations.

 The U.K.'s withdrawal
from the EU could result in increased regulatory and legal complexity, which may make it more difficult for us to do business in the
U.K. and/or Europe and impose additional challenges in securing regulatory approval of our product candidates in the U.K. and/or Europe.

 The U.K.'s exit from
the EU as of January 31, 2020, with a transitional period up to December 31, 2020, commonly referred to as "Brexit", has
caused political and economic uncertainty, including in the regulatory framework applicable to our operations and product candidates
in the U.K. and the EU, and this uncertainty may persist for years. Brexit could, among other outcomes, disrupt the free movement of
goods, services and people between the U.K. and the EU, and result in increased legal and regulatory complexities, as well as potential
higher costs of conducting business in Europe. As one of the Brexit consequences, the EMA has relocated from the U.K. to the Netherlands.
This has led to a significant reduction of the EMA workforce, which has resulted and could further result in significant disruption and
delays in its administrative procedures, such as granting clinical trial authorization or opinions for marketing authorization, disruption
of importation and export of active substance and other components of new drug formulations, and disruption of the supply chain for clinical
trial product and final authorized formulations.

 The cumulative effects of
the disruption to the regulatory framework may add considerably to the development lead time to marketing authorization and commercialization
of products in the EU and/or the U.K. It is possible that there will be increased regulatory complexities, which can disrupt the timing
of our clinical trials and regulatory approvals. In addition, changes in, and legal uncertainty with regard to, national and international
laws and regulations may present difficulties for our clinical and regulatory strategy. Any delay in obtaining, or an inability to obtain,
any marketing approvals, as a result of Brexit or otherwise, would prevent us from commercializing our product candidates in the U.K.
and/or the EU and restrict our ability to generate revenues and achieve and sustain profitability.

 In addition, as a result
of Brexit, other European countries may seek to conduct referenda with respect to their continuing membership with the EU. Given these
possibilities and others we may not anticipate, as well as the absence of comparable precedent, it is unclear what financial, regulatory
and legal implications the withdrawal of the U.K. from the EU will have, how such withdrawal will affect us, and the full extent to which
our business could be adversely affected.

 The increasing use
of social media platforms presents new risks and challenges to our business.

 Social media is increasingly
being used to communicate about pharmaceutical companies' research, product candidates, and the diseases such product candidates
are being developed to prevent. Social media practices in the pharmaceutical industry continue to evolve and regulations relating to
such use are not always clear. This evolution creates uncertainty and risk of noncompliance with regulations applicable to our business,
resulting in potential regulatory actions against us. For example, subjects may use social media channels to comment on their experience
in an ongoing blinded clinical trial or to report an alleged adverse event. When such events occur, there is a risk that we fail to monitor
and comply with applicable adverse event reporting obligations, or we may not be able to defend our business or the public's legitimate
interests in the face of the political and market pressures generated by social media due to restrictions on what we may say about our
investigational product candidates. There is also a risk of inappropriate disclosure of sensitive information or negative or inaccurate
posts or comments about us on any social media or networking website. Certain data protection regulations, such as the GDPR, apply to
personal data contained on social media. If any of these events were to occur or we otherwise fail to comply with applicable regulations,
we could incur liability, face regulatory actions or incur harm to our business, including damage to our reputation.

 We may incur indebtedness
in the future which could reduce our financial flexibility, increase interest expense and adversely impact our operations and our costs.

 We may incur significant
amounts of indebtedness in the future. Our level of indebtedness could affect our operations in several ways, including the following:

 a significant portion of our cash flows is required to be used to service
 our indebtedness;

 a high level of debt increases our vulnerability to general adverse
 economic and industry conditions;

 covenants contained in the agreements governing our outstanding indebtedness
 limit our ability to borrow additional funds and provide additional security interests, dispose of assets, pay dividends and make
 certain investments;

 a high level of debt may place us at a competitive disadvantage compared
 to our competitors that are less leveraged and, therefore, may be able to take advantage of opportunities that our indebtedness may
 prevent us from pursuing; and

 debt covenants may affect our flexibility in planning for, and reacting
 to, changes in the economy and in our industry.

 A high level of indebtedness
increases the risk that we may default on our debt obligations. We may not be able to generate sufficient cash flows to pay the principal
or interest on our debt, and future working capital, borrowings or equity financing may not be available to pay or refinance such debt.
If we do not have sufficient funds and are otherwise unable to arrange financing, we may have to sell significant assets or have a portion
of our assets foreclosed upon which could have a material adverse effect on our business, financial condition and results of operations.

 We may be adversely
impacted by changes in accounting standards.

 Our consolidated financial
statements are subject to the application of the accounting principles generally accepted in the United States of America (" U.S.
GAAP "), which periodically is revised or reinterpreted. From time to time, we are required to adopt new or revised accounting
standards issued by recognized authoritative bodies, including the Financial Accounting Standards Board (" FASB ") and
the SEC. It is possible that future accounting standards may require changes to the accounting treatment in our consolidated financial
statements and may require us to make significant changes to our financial systems. Such changes might have a materially adverse impact
on our financial position or results of operations.

 For all of the foregoing
reasons and others set forth herein, an investment in our securities involves a high degree of risk.

 Item 1B. Unresolved
Staff Comments.

 None.

 Item 1C. Cybersecurity.

 The Company understands the importance
of preventing, assessing, identifying, and managing material risks associated with cybersecurity threats. Consultants specializing in
cybersecurity risk were engaged to assess, identify and manage risks from cybersecurity threats separately from the Company's other
risk assessment processes. The cybersecurity risks assessed include operational risks, fraud, disaster recovery, and violation of data
privacy or security laws. The assessment includes cybersecurity threats associated with the use of third-party service providers.

 As a result of the cybersecurity
risk assessment performed, the Company has implemented certain enhancements to cybersecurity processes and controls. This includes formal
monitoring of capital equipment, verifying data encryption and security updates are in place, and enhancing the security of data sharing
and transmission. Additional recommendations were made by the consultants, but due to budget constraints they are being considered for
future enhancement.

 We describe whether and how
risks from identified cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or
are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition, under the
heading "Failure of our information technology systems, including cybersecurity attacks or other data security incidents, could
significantly disrupt the operation of our business", included as part of our risk factor disclosures at Item 1A of this Annual
Report on Form 10-K.

 Cybersecurity is an important
part of our risk management processes and an area of focus for our Board and management. Our CFO is responsible for the oversight of risks
from cybersecurity threats, having prior experience managing business risks including those related to cybersecurity. The Board receives
information and updates periodically with respect to the effectiveness of our cybersecurity and information security framework, data privacy
and risk management. The Board will also be provided updates on any material incidents relating to information systems security and cybersecurity
incidents. Although management and the Board will be made aware of cybersecurity incidents that could materially impact the Company,
formal monitoring of all cybersecurity incidents is planned for future implementation.

 As of and for the year ended
December 31, 2023, there have been no cybersecurity incidents that have materially affected the Company's business strategy, results
of operations, or financial condition.

 Item 2. Properties.

 The Company's headquarters are located in
Palo Alto, California. The Company believes its existing leased office space is suitable for the conduct of its business. We believe
that this arrangement is suitable for the conduct of our business, but we will secure a physical location for our operations if and when
we believe that it becomes necessary.

 Item 3. Legal
Proceedings.

 From time to time, we may
be a party to litigation that arises in the ordinary course of our business.

 Such current litigation or
other legal proceedings are described in, and incorporated by reference in, this "Item 3. Legal Proceedings" of this Annual
Report on Form 10-K from, "Note 9 – Commitments and Contingencies", under the heading "Litigation and Other Loss
Contingencies", in the consolidated financial statements included herein beginning on page F-1. The Company believes that the resolution
of currently pending matters will not individually or in the aggregate have a material adverse effect on our financial condition or results
of operations. However, assessment of the current litigation or other legal claims could change in light of the discovery of facts not
presently known to the Company or by judges, juries or other finders of fact, which are not in accord with management's evaluation
of the possible liability or outcome of such litigation or claims.

 Additionally, the outcome
of litigation is inherently uncertain. If one or more legal matters were resolved against the Company in a reporting period for amounts
in excess of management's expectations, the Company's financial condition and operating results for that reporting period
could be materially adversely affected.

 Item 4. Mine
Safety Disclosures.

 Not applicable.

 Item 5. Market
for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Market Information

 Our common stock and warrants
are listed on the Nasdaq Capital Market under the symbols "ATNF" and "ATNFW," respectively.

 Holders

 As of March 19, 2024, there
were 852,758 shares of common stock issued and outstanding held by 71 holders of record, and 180,828 shares of common stock underlying
11,500,000 public warrants outstanding to purchase shares of our common stock. Each public warrant entitles the registered holder to purchase
one-seven hundred sixtieth of one share of our common stock at a price of $5.75 per 1/760 th of one share or $4,370 per whole
share, subject to adjustment as discussed below, at any time commencing on December 6, 2020 (30 days after our initial business combination)
and ending on November 6, 2025 (five years after our initial business combination), at 5:00 p.m., New York City time, or earlier upon
redemption or liquidation. If a warrant holder holds 760 warrants, such warrants will be exercisable for one share of our common stock.
No fractional shares will be issued upon exercise of the warrants and warrants must be exercised for whole shares only.

 Dividend Policy

 We have never paid or declared
any cash dividends on our common stock and do not anticipate paying cash dividends in the foreseeable future. We anticipate that we will
retain all of our future earnings for use in the operation of our business and for general corporate purposes. Any determination to pay
dividends in the future will be at the discretion of our board of directors. Accordingly, investors must rely on sales of their common
stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments.

 Recent Sales of Unregistered Securities

 The Company has not sold any
equity securities during the three months ended December 31, 2023, and through the date of this report, except as has been previously
included in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K, except as described below:

 On March 12, 2024, a holder
of Class K Special Voting Shares converted such shares into 14 shares of common stock of the Company in a transaction exempt from registration
pursuant to Section 3(a)(9) of the Securities Act. As a result of such conversion, there are no longer any Class K Special Voting Shares.

 Issuer Purchases of Equity Securities

 None.

 Special Voting Shares

 We have two classes of preferred
stock designated, named our Class C Special Voting Shares and our Class K Special Voting Shares (collectively, the " Special
Voting Shares "), with the rights and preferences specified below.

 The Special Voting Shares
have a par value of $0.0001 per share. The rights and preferences of each Special Voting Shares consists of the following:

 the right to vote in all circumstances in which our common
stock have the right to vote, with the common stock as one class;

 the Special Voting Shares entitle the holder Odyssey Trust
Company (the Trustee) to an aggregate number of votes equal to the number of shares of common stock that were issuable to the holders
of the previously outstanding shares of CannBioRex Purchaseco ULC and/or Katexco Purchaseco ULC, Canadian subsidiaries of 180 (the " Exchangeable
Shares ");

 the holder of the Special Voting Shares (and, indirectly,
the holders of the Exchangeable Shares) has the same rights as the holders of the common stock as to notices, reports, financial statements
and attendance at all stockholder meetings;

 no entitlement to dividends;

 the holder of the Special Voting Shares is not entitled to
any portion of any related distribution upon windup, dissolution or liquidation of the Company; and

 the Company may cancel the Special Voting Shares when there
are no Exchangeable Shares outstanding and no option or other commitment of CannBioRex Purchaseco ULC and Katexco Purchaseco ULC which
could require either CannBioRex Purchaseco ULC and Katexco Purchaseco ULC to issue more Exchangeable Shares.

 As set forth above, the holders
of the Exchangeable Shares, through the applicable Special Voting Share, have voting rights and other attributes corresponding to the
common stock. The Exchangeable Shares provide an opportunity for certain former Canadian resident holders of CBR Pharma or Katexco securities
to obtain a deferral of taxable capital gains for Canadian income tax purposes in connection with the Reorganization.

 As of the date of this Report,
there are no Class C Special Voting Shares or Class K Special Voting Shares outstanding.

 Item 6. [Reserved]

 ITEM 7. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 The following discussion
and analysis of the results of operations and financial condition of 180 Life Sciences Corp. as of and for the years ended December 31,
2023 and 2022 should be read in conjunction with our consolidated financial statements and the notes to those consolidated financial
statements that are included elsewhere in this Annual Report. This Management's Discussion and Analysis of Financial Condition
and Results of Operations contains statements that are forward-looking. See "Cautionary Statement Regarding Forward-Looking Information"
above. Actual results could differ materially because of the factors discussed in "Risk Factors" elsewhere in this Annual
Report, and other factors that we may not know.

 As of December 31, 2023,
we had an accumulated deficit of $127,343,657 and a working capital deficit of $1,422,710, and for the year ended December 31, 2023,
a net loss of $19,935,112 and cash used in operating activities of $10,922,223. The accompanying consolidated financial statements have
been prepared assuming the Company will continue as a going concern. As we are not generating revenues, we need to raise a significant
amount of capital in order to pay our debts and cover our operating costs. While the Company raised capital in July 2022, December 2022,
April 2023, August 2023 and November 2023, there is no assurance that we will be able to raise additional needed capital or that such
capital will be available under favorable terms.

 We are subject to all the
substantial risks inherent in the development of a new business enterprise within an extremely competitive industry. Due to the absence
of a long-standing operating history and the emerging nature of the markets in which we compete, we anticipate operating losses until
we can successfully implement our business strategy, which includes all associated revenue streams. We may never ever achieve profitable
operations or generate significant revenues.

 We currently have a minimum
monthly cash requirement spend of approximately $350,000. We believe that in the aggregate, we will require significant additional capital
funding to support and expand the research and development and marketing of our products, fund future clinical trials, repay debt obligations,
provide capital expenditures for additional equipment and development costs, payment obligations, office space and systems for managing
the business, and cover other operating costs until our planned revenue streams from products are fully-implemented and begin to offset
our operating costs, if ever.

 Since our inception, we have
funded our operations with the proceeds from equity and debt financing. We have experienced liquidity issues due to, among other reasons,
our limited ability to raise adequate capital on acceptable terms. We have historically relied upon the issuance of equity and promissory
notes that are convertible into shares of our common stock to fund our operations and have devoted significant efforts to reduce that
exposure. We anticipate that we will need to issue equity to fund our operations and repay our outstanding debt for the foreseeable future.
If we are unable to achieve operational profitability, or we are not successful in securing other forms of financing, we will have to
evaluate alternative actions to reduce our operating expenses and conserve cash. Our current cash balance is only expected to be sufficient
to fund our planned business operations through approximately May 2024. If additional capital is not available, we may not be able to
pursue our planned business operations, may be forced to change our planned business operations, or may take other actions that could
adversely impact our stockholders, including seeking bankruptcy protection.

 The accompanying consolidated
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America on
a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.
Accordingly, the consolidated financial statements do not include any adjustments relating to the recoverability of assets and classification
of liabilities that might be necessary should the Company be unable to continue as a going concern. The consolidated financial statements
included in this prospectus also include a going concern footnote.

 Additionally, wherever possible,
our Board of Directors will attempt to use non-cash consideration to satisfy obligations. In many instances, we believe that the non-cash
consideration will consist of restricted shares of our common stock, preferred stock or warrants to purchase shares of our common stock.
Our Board of Directors has authority, without action or vote of the shareholders, but subject to Nasdaq rules and regulations (which generally
require shareholder approval for any transactions which would result in the issuance of more than 20% of our then outstanding shares of
common stock or voting rights representing over 20% of our then outstanding shares of stock), to issue all or part of the authorized but
unissued shares of common stock, preferred stock or warrants to purchase such shares of common stock. In addition, we may attempt to raise
capital by selling shares of our common stock, possibly at a discount to market in the future. These actions will result in dilution of
the ownership interests of existing shareholders, may further dilute the common stock book value, and that dilution may be material. Such
issuances may also serve to enhance existing management's ability to maintain control of us, because the shares may be issued to
parties or entities committed to supporting existing management.

 Organization of MD&A

 Our Management's Discussion
and Analysis of Financial Condition and Results of Operations (the "MD&A") is provided in addition to the accompanying
consolidated financial statements and notes to assist readers in understanding our results of operations, financial condition, and cash
flows. MD&A is organized as follows:

 Business Overview and Recent Events. A summary of the
Company's business and certain material recent events.

 Significant Financial Statement Components. A
summary of the Company's significant financial statement components.

 Results of Operations. An analysis of our financial
results comparing the years ended December 31, 2023 and 2022.

 Liquidity and Capital Resources. An analysis of changes
in our balance sheets and cash flows and discussion of our financial condition.

 Critical Accounting Estimates. Accounting estimates that we believe are important to
 understanding the assumptions and judgments incorporated in our reported financial results and forecasts.

 Business Overview and Recent Events

 This MD&A and the related
financial statements for the year ended December 31, 2023, primarily cover the operations of 180, which is a clinical stage biotechnology
company headquartered in Palo Alto, California, focused on the development of therapeutics for unmet medical needs in chronic pain, inflammation,
fibrosis and other inflammatory diseases, where anti-TNF therapy will provide a clear benefit to patients, by employing innovative research,
and, where appropriate, combination therapy. We have three product development platforms:

 fibrosis and anti-tumor necrosis factor (" TNF ");

 drugs which are derivatives of cannabidiol (" CBD ");
and

 alpha 7 nicotinic acetylcholine receptor (" 7nAChR ").

 Due to restrictions in the
Company's resources, the Company has not made progress in the 7nAChR platform and has suspended further research and development
activity in the meantime.

 We have several future product
candidates in development, including one product candidate which has recently completed a successful Phase 2b clinical trial in the United
Kingdom for Dupuytren's Contracture, a condition that affects the development of fibrous connective tissue in the palm of the hand.
180 was founded by several world-leading scientists in the biotechnology and pharmaceutical sectors.

 We intend to invest resources
to successfully complete the clinical programs that are underway, discover new drug candidates, and develop new molecules to build up
on our existing pipeline to address unmet clinical needs. The product candidates are designed through a platform comprised of defined
unit operations and technologies. This work is performed in a research and development environment that evaluates and assesses variability
in each step of the process to define the most reliable production conditions.

 We may rely on third-party
contract manufacturing organizations (" CMOs ") and other third parties for the manufacturing and processing of the
product candidates in the future. We believe the use of contract manufacturing and testing for the first clinical product candidates
is cost-effective and has allowed us to rapidly prepare for clinical trials in accordance with our development plans. We expect that
third-party manufacturers will be capable of providing and processing sufficient quantities of these product candidates to meet anticipated
clinical trial demands.

 Significant Financial Statement Components

 Research and Development

 To date, 180's research and development expenses have related
primarily to discovery efforts and preclinical and clinical development of its three product platforms: (1) fibrosis and anti-TNF, (2)
drugs which are derivatives of CBD, and (3) 7nAChR (currently suspended). Research and development expenses consist primarily of
costs associated with those three product platforms, which include:

 expenses incurred under agreements with 180's collaboration
partners and third-party contract organizations, investigative clinical trial sites that conduct research and development activities
on its behalf, and consultants;

 costs related to production of clinical materials, including
fees paid to contract manufacturers;

 laboratory and vendor expenses related to the execution of
preclinical and clinical trials;

 employee-related expenses, which include salaries, benefits,
and stock-based compensation; and

 facilities and other expenses, which include expenses for
rent and maintenance of facilities, depreciation and amortization expense and other supplies.

 We expense all research and
development costs in the periods in which they are incurred. We accrue for costs incurred as services are provided by monitoring the
status of each project and the invoices received from our external service providers. We adjust our accrual as actual costs become known.
When contingent milestone payments are owed to third parties under research and development arrangements or license agreements, the milestone
payment obligations are expensed when the milestone results are achieved.

 Research and development
activities are central to our business model. Product candidates in later stages of clinical development generally have higher development
costs than those in earlier stages of clinical development, primarily due to the increased size and duration of later-stage clinical
trials. We expect that research and development expenses will increase over the next several years as clinical programs progress and
as we seek to initiate clinical trials of additional product candidates. It is also expected that increased research and development
expenses will be incurred as additional product candidates are selectively identified and developed. However, it is difficult to determine
with certainty the duration and completion costs of current or future preclinical programs and clinical trials of product candidates.

 The duration, costs, timing
of clinical trials, and development of product candidates will depend on a variety of factors that include, but are not limited to, the
following:

 per patient trial costs;

 the number of patients that participate in the trials;

 the number of sites included in the trials;

 the countries in which the trials are conducted;

 the length of time required to enroll eligible patients;

 the number of doses that patients receive;

 the drop-out or discontinuation rates of patients;

 potential additional safety monitoring or other studies requested
by regulatory agencies;

 the impact of COVID-19 on the length of our trials;

 the duration of patient follow-up; and

 the efficacy and safety profile of the product candidates.

 In addition, the probability
of success for each product candidate will depend on numerous factors, including competition, manufacturing capability, and commercial
viability. We will determine which programs to pursue and fund in response to the scientific and clinical success of each product candidate,
as well as an assessment of each product candidate's commercial potential.

 Because the product candidates
are still in clinical and preclinical development and the outcome of these efforts is uncertain, we cannot estimate the actual amounts
necessary to successfully complete the development and commercialization of product candidates or whether, or when, we may achieve profitability.
Due to the early-stage nature of these programs, we do not track costs on a project-by-project basis. As these programs become more advanced,
we intend to track the external and internal cost of each program.

 General and Administrative

 General and administrative
expenses consist primarily of salaries and other staff-related costs, including stock-based compensation for shares of common stock issued
and options granted to founders, directors, and personnel in executive, commercial, finance, accounting, legal, investor relations, facilities,
business development, and human resources functions that include vesting conditions.

 Other significant general
and administrative costs include costs relating to facilities and overhead costs, legal fees relating to corporate and patent matters,
litigation, SEC filings, insurance, investor relations costs, fees for accounting and consulting services, and other general and administrative
costs. General and administrative costs are expensed as incurred, and we accrue amounts for services provided by third parties related
to the above expenses by monitoring the status of services provided and receiving estimates from our service providers and adjusting
our accruals as actual costs become known.

 It is expected that the general
and administrative expenses will increase over the next several years to support our continued research and development activities, manufacturing
activities, potential commercialization of our product candidates and the increased costs of operating as a public company. These increases
are anticipated to include increased costs related to the hiring of additional personnel, developing commercial infrastructure, fees
to outside consultants, lawyers and accountants, and increased costs associated with being a public company, as well as expenses related
to services associated with maintaining compliance with Nasdaq listing rules and SEC requirements, insurance and investor relations costs.

 Other Income

 Other income primarily represents
fees earned for research and development work performed for other companies, some of which are related parties.

 Interest Expense

 Interest expense consists
primarily of interest expense related to debt instruments.

 Loss on Goodwill
Impairment

 Loss
on goodwill impairment represents an excess of the carrying value of the asset over its estimated fair market value during the reporting
period which is not recoverable.

 Loss on IP R&D
assets impairment

 Loss
on IP R&D assets impairment represents an excess of the carrying value of the assets over its estimated fair market value during
the reporting period which is not recoverable.

 Change in Fair
Value of IR R&D assets

 Change
in fair value of IP R&D assets represents the non-cash change in fair value of the assets during the reporting period.

 Change in Fair
Value of Derivative Liabilities

 Change
in fair value of derivative liabilities represents the non-cash change in fair value of derivative liabilities during the reporting period.
Gains resulting from change in fair value of derivative liabilities during the years ended December 31, 2023 and 2022, were driven by
decreases in stock price during the period, resulting in a lower fair value of the underlying liability.

 Gain on Issuance of Common Stock for Services

 The gain on issuance of common
stock for services represents the excess of the price per share paid for services rendered over the fair market value of the shares on
the date they were issued.

 CONSOLIDATED RESULTS OF OPERATIONS

 Consolidated Results of Operations

 For the Year Ended December 31, 2023 Compared
to the Year Ended December 31, 2022

 2023

 2022

 Operating Expenses:

 Research and development

 $
 2,303,751

 $
 2,191,834

 Research and development – related parties

 480,777

 240,731

 General and administrative

 10,646,417

 15,459,788

 General and administrative – related parties

 46,555

 5,612

 Total Operating Expenses

 13,477,500

 17,897,965

 Loss From Operations

 (13,477,500
)

 (17,897,965
)

 Other (Expense) Income:

 Other income

 21,074

 -

 Interest expense

 (44,828
)

 (28,175
)

 Interest income – related parties

 -

 1,508

 Loss on goodwill impairment

 -

 (33,547,278
)

 Loss on IP R&D assets impairment

 (9,063,000
)

 (3,342,084
)

 75,323

 15,144,986

 Gain on issuance of common stock for services

 204,405

 -

 Total Other Expense, Net

 (8,807,026
)

 (21,771,043
)

 Loss Before Income Taxes

 (22,284,526
)

 (39,669,008
)

 Income tax benefit

 2,349,414

 942,749

 Net Loss

 $
 (19,935,112
)

 $
 (38,726,259
)

 Research and Development

31, 2023, we incurred research and development expenses of $2,303,751 compared to $2,191,834 incurred for the year ended December 31,
2022, representing an increase of $111,917 or 5%. The change is attributable to a decrease in the R&D Tax credit, which increased
research and development expenses in the current period by approximately $400,000; there were also net increases of approximately $370,000
in expenses incurred by Oxford University. These increases were offset by i) reductions in salaries and bonuses of approximately $570,000
due to reductions/terminations and ii) decreases in fees paid to the Scientific Advisory Board of approximately $90,000.

 Research and Development – Related Parties

31, 2023, we incurred research and development expenses – related parties of $480,777 compared to $240,731 incurred for the year
ended December 31, 2022, representing an increase of $240,046 or 100%. The change is attributable to a decrease in the R&D Tax credit,
which increased research and development expenses by approximately $125,000, as well as an increase of approximately $200,000 in consulting
fees. These increases were offset by a reduction in stock-based compensation of approximately $80,000.

 General and Administrative

31, 2023, we incurred general and administrative expenses of $10,646,417 compared to $15,459,788 incurred for the year ended December
31, 2022, representing a decrease of $4,813,371 or 31%. The change resulted from reductions in legal expenses, insurance expenses, accrued
bonuses and stock-based compensation expenses of approximately $2.8 million, $800,000, $700,000 and $500,000, respectively.

 General and Administrative – Related
Parties

31, 2023, we incurred general and administrative expenses – related parties of $46,555 compared to $5,612 incurred for the year
ended December 31, 2022, representing an increase of $40,943, or 730%. The increase is primarily related to an increase in related party
consulting expenses of $41,000.

 Other Expenses, Net

31, 2023, we incurred other expenses, net of $8,807,026 compared to $21,771,043 for the year ended December 31, 2022, representing a decrease
in other expenses of $12,964,017 or 60%. The decrease in expenses was primarily because of i) an impairment to goodwill in the prior year
of $33,547,278 (see Note 5 - Intangible Assets and Impairment of Long-Lived Assets, to the consolidated financial statements included
herein), offset by ii) a decrease in impairment to IP R&D assets in the current year from the prior year of $5,720,916, and iii) a
decrease in the current year from the prior year in the change in fair value of derivative liabilities of $15,069,663.

 Liquidity and Capital Resources

 As
of December 31, 2023 and 2022, we had cash balances of $1,975,799 and $6,970,110, respectively, and a working capital deficit of $1,422,710
and working capital of $3,270,608, respectively.

 For the years ended December 31, 2023 and 2022, cash used in operating
activities was $10,922,223 and $12,127,585, respectively. Our cash used in operations for the year ended December 31, 2023 was primarily
attributable to our net loss of $19,935,112, adjusted for non-cash expenses in the aggregate amount of $9,026,993, as well as $14,101
of net cash used in changes in the levels of operating assets and liabilities. A significant portion of the non-cash expenses during the
year relates to $9.1 million of non-recurring expenses associated with the impairment of IP R&D assets (see Note 5 – Intangible
Assets and Impairment of Long-lived Assets, to the consolidated financial statements included herein). Our cash used in operations
for the year ended December 31, 2022 was primarily attributable to our net loss of $38,726,259, adjusted for non-cash expenses in the
aggregate amount of $23,876,048, as well as $2,722,626 of net cash used in changes in the levels of operating assets and liabilities.
A significant portion of the non-cash expenses during the year relates to $36.9 million of non-recurring expenses associated with the
impairment of goodwill and IP R&D assets (see Note 5 – Intangible Assets and Impairment of Long-lived Assets, to the
consolidated financial statements included herein), offset by changes in fair value of derivative liabilities of $15,144,986 for the year.

 For the years ended December
31, 2023 and 2022, there was no cash provided by investing activities.

 For the years ended December 31, 2023 and 2022, cash provided by financing
activities was $5,907,887 and $10,873,606, respectively. Cash provided by financing activities during the year ended December 31, 2023,
was primarily comprised of i) proceeds from the sale of common stock and common stock warrants from the April and August 2023 Offerings
of $5,999,488 and ii) proceeds from the repricing of pre-funded warrants and common warrants from the August 2023 Offering of $830,769,
partially offset by iii) aggregate offering costs paid in connection with our April and August 2023 Offerings and the repricing of the
August 2023 Offering of $634,816, as well as iv) proceeds from and repayments of loans of $969,322 and $1,257,389, respectively. Cash
provided by financing activities during the year ended December 31, 2022 was primarily comprised of i) proceeds from the sale of July
2022 common stock and common stock warrants of $6,499,737, ii) proceeds from the sale of December 2022 common stock and common warrants
of $5,999,851 and iii) proceeds from loans payable of $1,060,890, partially offset by iv) offering costs paid in connection with our July
2022 and December 2022 Offerings of $529,982 and $484,991, respectively, and v) repayments of loans payable and loans payable –
related parties of $1,591,035 and $81,277, respectively.

 Our
product candidates may never achieve commercialization and we anticipate that we will continue to incur losses for the foreseeable future.
We expect that our research and development expenses, general and administrative expenses, and capital expenditures will continue to
increase. As a result, until such time, if ever, as we are able to generate substantial product revenue, we expect to finance our cash
needs through a combination of equity offerings, debt financings or other capital sources, including potentially collaborations, licenses
and other similar arrangements, which may not be available on favorable terms, if at all. The sale of additional equity or debt securities,
if accomplished, may result in dilution to our then stockholders. Our primary uses of capital are, and we expect will continue to be,
compensation and related expenses, third-party clinical research and development services, license payments or milestone obligations
that may arise, laboratory and related supplies, clinical costs, potential manufacturing costs, legal and other regulatory expenses and
general overhead costs.

 Our material cash requirements
and time periods of such requirements from known contractual and other obligations include milestone and royalty payments related to
license agreements with Oxford University and Yissum, payments related to the D&O insurance, payments to consultants and payments
related to outside consulting firms, such as legal counsel, auditors, accountants, etc. These cash requirements, in the aggregate, amount
to approximately $6,000,000 for 2024 and $38,000,000 for the years 2025 through 2028.

 Further,
our operating plans may change, and we may need additional funds to meet operational needs and capital requirements for clinical trials
and other research and development activities. We currently have no credit facility or committed sources of capital. Because of the numerous
risks and uncertainties associated with the development and commercialization of our product candidates, we are unable to estimate the
amounts of increased capital outlays and operating expenditures associated with our current and anticipated product development programs.

 We have not yet achieved profitability
and expect to continue to incur cash outflows from operations. It is expected that our research and development and general and administrative
expenses will continue to increase and, as a result, we will eventually need to raise additional capital to fund our operations. If we
are unable to obtain adequate funds on reasonable terms, we may be required to significantly curtail or discontinue operations or obtain
funds by entering into financing agreements on unattractive terms. Our operating needs include the planned costs to operate our business,
including amounts required to fund working capital and capital expenditures. As of December 31, 2023, the conditions outlined above indicated
that there was a substantial doubt about our ability to continue as a going concern within one year after the financial statement issuance
date. However, in July 2022, December 2022, April 2023, August 2023 and November 2023, the Company raised additional capital of approximately
$6.0 million, $5.5 million, $2.7 million, $2.7 million and $0.8 million, respectively, and with current cash on hand of approximately
$0.8 million as of March 18, 2024, the Company expects to be able to continue as a going concern through May 2024.

 Our
consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States
of America ("U.S. GAAP"), which contemplate continuation of the Company as a going concern and the realization of assets
and satisfaction of liabilities in the normal course of business. The carrying amounts of assets and liabilities presented in the consolidated
financial statements do not necessarily purport to represent realizable or settlement values. The consolidated financial statements do
not include any adjustment that might result from the outcome of this uncertainty.

 Recent Financings

 July 2022 Offering

 On July 17, 2022, the Company
entered into a Securities Purchase Agreement with certain purchasers, pursuant to which the Company agreed to sell an aggregate of 9,211
shares of common stock, pre-funded warrants to purchase up to an aggregate of 6,927 shares of common stock ("July 2022 Pre-Funded
Warrants"), and common stock warrants to purchase up to an aggregate of 16,138 shares of common stock (the "July 2022 Common
Warrants"), at a combined purchase price of $402.80 per share and warrant (the "July 2022 Offering"). Aggregate gross
proceeds from the July 2022 Offering were $6,499,737. Net proceeds to the Company from the Offering, after deducting the placement agent
fees and other estimated offering expenses payable by the Company, were approximately $6.0 million. The placement agent fees and offering
expenses of approximately $530,000 were accounted for as a reduction of additional paid in capital. The July 2022 Offering closed on July
20, 2022.

 December 2022 Offering

 On December 20, 2022, the
Company entered into a Securities Purchase Agreement with certain purchasers, pursuant to which the Company agreed to sell an aggregate
of 11,316 shares of common stock, pre-funded warrants to purchase up to an aggregate of 78,910 shares of common stock ("December
2022 Pre-Funded Warrants"), and common stock warrants to purchase up to an aggregate of 135,339 shares of common stock (the "December
2022 Common Warrants"), at a combined purchase price of $66.50 per share and warrant (the "December 2022 Offering").
Aggregate gross proceeds from the December 2022 Offering were $5,999,851. Net proceeds to the Company from the offering, after deducting
the placement agent fees and other estimated offering expenses payable by the Company, were approximately $5.5 million. The placement
agent fees and offering expenses of approximately $500,000 were accounted for as a reduction of additional paid in capital. The December
2022 Offering closed on December 22, 2022.

 April 2023 Offering

 On April 5, 2023, the Company
entered into a Securities Purchase Agreement with certain purchasers, pursuant to which the Company agreed to sell an aggregate of 21,053
shares of common stock, pre-funded warrants to purchase up to an aggregate of 61,615 shares of common stock ("April 2023 Pre-Funded
Warrants"), and common stock warrants to purchase up to an aggregate of 82,668 shares of common stock (the "April 2023 Common
Warrants"), at a combined purchase price of $36.29 per share and warrant (the "April 2023 Offering"). Aggregate gross
proceeds from the April 2023 Offering were $2,999,882. Net proceeds to the Company from the offering, after deducting the placement agent
fees and other estimated offering expenses payable by the Company, were approximately $2.7 million. The placement agent fees and offering
expenses of approximately $300,000 were accounted for as a reduction of additional paid in capital. The April 2023 Offering closed on
April 10, 2023.

 August 2023 Offering

 On August 9, 2023, the Company
entered into a Securities Purchase Agreement with an accredited investor, in addition to certain purchasers who relied on the Company's
registration statement filed with the SEC on July 25, 2023, which became effective on August 9, 2023, pursuant to which the Company agreed
to sell an aggregate of 35,102 shares of common stock, pre-funded warrants to purchase up to an aggregate of 207,814 shares of common
stock ("August 2023 Pre-Funded Warrants"), and common stock warrants to purchase up to an aggregate of 242,915 shares of common
stock (the "August 2023 Common Warrants"), at a combined purchase price of $12.35 per share and warrant (the "August
2023 Offering"). Aggregate gross proceeds from the August 2023 Offering were $2,999,606. Net proceeds to the Company from the offering,
after deducting the placement agent fees and other estimated offering expenses payable by the Company, were approximately $2.7 million.
The placement agent fees and offering expenses of approximately $300,000 were accounted for as a reduction of additional paid in capital.
The August 2023 Offering closed on August 14, 2023.

 Amendment to August 2023 Offering

 On October 11, 2023, the Company received a letter from Nasdaq, stating
that Nasdaq had determined that the Company failed to comply with Nasdaq's shareholder approval requirements set forth in Listing
Rule 5635(d), which requires prior shareholder approval for transactions, other than public offerings, involving the issuance of 20% or
more of the pre-transaction shares outstanding at less than the Minimum Price. The letter from Nasdaq referred to the August 2023 Offering
and requested the Company to submit a plan of compliance no later than November 27, 2023. On November 9, 2023, the Company submitted a
plan of compliance to Nasdaq, and on November 14, 2023, Nasdaq provided a letter of extension to the Company.

 Pursuant to the compliance plan submitted to Nasdaq, on November 28,
2023, the Company entered into an amendment to the August 2023 Offering ("Amendment to the August 2023 Offering"), whereby
(i) the Purchaser agreed to pay an additional $830,769 in connection with the repricing of the August Shares and August Pre-Funded Warrants
(the "Repricing Amount"), (ii) the Company agreed to issue to the Purchaser additional pre-funded warrants to purchase up
to 257,205 shares of common stock, with an exercise price of $0.0019 per share (the "Additional Pre- Funded Warrants"), and
warrants to purchase up to 477,058 shares of common stock, with an exercise price of $3.23 per share (the "Additional Common Warrants",
collectively the "Additional Warrants"), and (iii) the Company and the Purchaser agreed to enter into the warrant amendment
agreement. Net proceeds to the Company from the repricing, after deducting the placement agent fees and other estimated offering expenses
payable by the Company, were approximately $0.8 million. The placement agent fees and offering expenses of approximately $60,000 were
accounted for as a reduction of additional paid in capital. The Amendment to the August 2023 Offering closed on December 1, 2023.

 Critical Accounting Estimates

 The
Company's consolidated financial statements are prepared in accordance with accounting principles that are generally accepted in
the United States. The preparation of these consolidated financial statements requires management to make estimates and assumptions that
affect the reported amounts of its assets, liabilities, revenue and expenses. The Company has identified certain estimates as critical
to its business operations and the understanding of its past or present results of operations related to in-process research and development
("IP R&D"). These estimates are considered critical because they had a material impact, or they have the potential to
have a material impact, on the Company's consolidated financial statements and because they require management to make significant
judgments, assumptions or estimates. The Company believes that the estimates, judgments and assumptions made when accounting for the items
described below were reasonable, based on information available at the time they were made. However, actual results may differ from those
estimates, and these differences may be material.

 In-Process Research and Development

 The Company has a significant
amount of IP R&D assets that are assessed at least annually for impairment. The impairment analyses of these assets are considered
critical because of their significance to the Company. Intangible assets arising from business combinations or acquisitions, such as IP
R&D assets are initially recorded at estimated fair value. IP R&D assets are considered to be indefinite-lived until the completion
or abandonment of the associated research and development projects.

 The Company is required to
assess IP R&D assets at least annually, or more frequently, if an event occurs or circumstances change that indicates it is more likely
than not the fair value of the Company's reporting unit was less than its carrying value. In assessing IP R&D assets for impairment,
the Company may first assess qualitative factors to determine whether it is more likely than not that the fair value of its reporting
unit is less than its carrying value.

 IP R&D Assets Impairment

 As of December 31, 2022,
the carrying amount of the IP R&D assets on the balance sheet was $12,405,084 (which consists of carrying value of $1,462,084 and
$10,943,000 related to the Company's CBR Pharma subsidiary and its 180 LP subsidiary, respectively). Per the valuation obtained
from a third party as of year-end, the fair market value of the Company's IP R&D assets was determined to be $9,063,000 (which
consists of fair market values of $0 and $9,063,000 related to the Company's CBR Pharma subsidiary and 180 LP subsidiary, respectively).
As of this measurement date, the carrying value of the CBR Pharma and 180 LP subsidiaries' assets exceeded their fair market values
by $1,462,084 and $1,880,000, respectively. As such, management determined that the consolidated IP R&D assets were impaired by $3,342,084
and, in order to recognize the impairment, the Company recorded a loss for this amount during the fourth quarter of 2022, which appears
as a loss on impairment of IP R&D assets on the income statement. This reduced the IP R&D asset balances of its CBR Pharma subsidiary
and its 180 LP subsidiary to zero and $9,063,000, respectively, as of December 31, 2022; the total consolidated IP R&D asset balance
was $9,063,000 after impairment.

 During 2023, the Company assessed the most recent delays in its commercialization
timeline, general economic conditions, industry and market considerations, the Company's financial performance and all relevant
legal, regulatory, and political factors that might indicate the possibility of impairment and concluded that, when these factors were
collectively evaluated, it is more likely than not that the asset is impaired. The Company recorded a loss in the amount of $9,063,000,
which appeared as a loss on impairment to IP R&D assets on the income statement. As a result, the carrying amount of the IP R&D
assets on the balance sheet became $0 (nil) as of December 31, 2023. Additionally, as a result of the write-off of the IP R&D assets
on the balance sheet and the loss on impairment to IP R&D assets on the income statement, the Company recorded a decrease in its deferred
tax liability relating to the impairment of the IP R&D assets of $2.3 million as income tax benefit relating to impairment of the
IP R&D assets in the same amount on the income statement (see Note 5 – Intangible Assets and Impairment of Long-lived Assets,
 to the consolidated financial statements included herein, for further information).

 Recently Issued Accounting Pronouncements

 See Note 3 – Summary of Significant Accounting Policies
of our consolidated financial statements included within this Annual Report for a summary of recently issued and adopted accounting pronouncements.

 Item 7A. Quantitative
and Qualitative Disclosures About Market Risk.

 Pursuant to Item 305 of
Regulation S-K (§ 229.305(e)), the Company is not required to provide the information required by this Item as it is a " smaller
reporting company, " as defined by Rule 229.10(f)(1), however, the Company has provided the following information below relating
to interest rate risk.

 Interest Rate Risk

 We are exposed to market risks in the ordinary course of its business.
These risks primarily include interest rate sensitivities. As of December 31, 2023, we had $1,975,799 in cash and cash equivalents. We
intend to hold our cash in interest-bearing money market accounts. Our primary exposure to market risk is interest rate sensitivity, which
is affected by changes in the general level of U.S. interest rates. Due to the short-term maturities of our cash equivalents and the low
risk profile of its investments, an immediate 100 basis point change in interest rates would not have a material effect on the fair market
value of our cash equivalents.

 Item 8. Financial
Statements and Supplemental Data.

by this Item is included in this Report as set forth in the "Index to Consolidated Financial Statements" which appears on
page F-1 of this Annual Report on Form 10-K, after the signature pages of this Report, and is incorporated by reference herein.

 Item 9. Changes
in and Disagreements with Accountants on Accounting and Financial Disclosure.

 None.

 Item 9A. Controls
and Procedures.

 Evaluation of Disclosure Controls and Procedures

 Our management, with the participation
of our principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures,
as such term is defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities and Exchange Act as of December 31, 2023. Based
on such evaluation, the principal executive officer and the principal financial officer have concluded that the Company's disclosure controls
and procedures were effective as of December 31, 2023.

 Management's Report on Internal Control
over Financial Reporting

 Management of 180 Life Sciences
Corp. is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange
Act Rules 13a-15(f) and 15d-15(f). Internal control over financial reporting is a process designed by, or under the supervision of, our
principal executive officer and principal financial officer, or persons performing similar functions, and effected by our board of directors
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance
with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and
procedures that: (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions
and dispositions of the assets of the Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of
the Company are being made only in accordance with authorizations of management and directors of the Company; and (iii) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company's assets that
could have a material effect on the financial statements.

 Because of its inherent limitations,
internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective
can provide only reasonable assurance with respect to financial statement preparation and presentation, projections of any evaluation
of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that
the degree of compliance with the policies or procedures may deteriorate.

 A material weakness is a control
deficiency or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of the annual
or interim financial statements will not be prevented or detected on a timely basis. As a company with limited accounting resources, a
significant amount of management's time and attention has been and will be diverted from our business to ensure compliance with
these regulatory requirements.

 We are a "smaller reporting
company" as defined in Item 10(f)(1) of Regulation S-K under the Securities Act. For as long as we continue to be a smaller reporting
company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are
not smaller reporting companies.

 Management of 180 Life Sciences
Corp., including our principal financial officer, conducted an evaluation of the effectiveness of the Company's internal control
over financial reporting as of December 31, 2023 using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO") in "Internal Control - Integrated Framework" (2013).

 Management concluded that
the Company's internal control over financial reporting was effective as of December 31, 2023, based on those criteria.

 Remediation Of Material Weaknesses in Internal
Control over Financial Reporting

 The Company had previously
reported, as of December 31, 2022, that it had identified the following material weakness in its internal control over financial reporting:

 The Company's review and control procedures did not operate at the appropriate level of precision to detect an error in fair value of warrants related to a one-time reverse stock split and the fair value of IP R&D assets.

31, 2023, the Company has taken corrective action and/or placed in operation, controls to address the material weakness described above,
including implementing a detailed fluctuations/variance analysis for income statement items, as well as adding a layer of review to SEC
reporting. We have performed the following steps in 2023:

 1.

 Implemented an analysis of fluctuations and variances on a quarterly basis for the Income Statement which would detect material movements in account balances from both a dollar amount and percentage change perspective and research any differences over a defined threshold.

 2.

 Implemented an additional layer of review over the SEC reporting process and ensure that the overall financial statements and preparation are subject to concurring review by a member of the SEC reporting team other than the SEC reporting manager.

 Based
on the corrective actions described above, and testing completed for the year ended December 31, 2023, management has concluded that material
weakness noted above that existed as of December 31, 2022 has been remediated.

 Limitations on Effectiveness of Controls
and Procedures

 In designing and evaluating
the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated,
can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and
procedures must reflect the fact that there are resource constraints and that management is required to apply its judgment in evaluating
the benefits of possible controls and procedures relative to their costs.

 Changes in Internal Control over Financial
Reporting

 There have been no changes
in the Company's internal control over financial reporting during the quarter ended December 31, 2023, that materially affected,
or are reasonably likely to materially affect, the Company's internal control over financial reporting.

 Item 9B. Other
Information.

 Rule 10b5-1 Trading Plans.
 During the quarter ended December 31, 2023, none of the Company's directors or officers (as defined in Rule 16a-1(f)) adopted or terminated any
contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense
conditions of Rule 10b5-1(c) or any "non-Rule 10b5-1 trading arrangement."

 Item 9C. Disclosure
Regarding Foreign Jurisdictions That Prevent Inspections.

 None.

 Information required by Items
10, 11, 12, 13 and 14 of Part III is omitted from this Annual Report and will be filed in a definitive proxy statement or by an amendment
to this Annual Report not later than 120 days after the end of the fiscal year covered by this Annual Report.

 Item 10. Directors,
Executive Officers and Corporate Governance.

by this Item is included under the headings " Election of Directors ", " Executive Officers ", " Corporate
Governance ", " Code of Ethics ", " Board Committee Membership ", and " Delinquent
Section 16(a) Reports " (to the extent applicable and warranted) in the Company's 2024 Proxy Statement to be filed with
the U.S. Securities and Exchange Commission ("SEC") within 120 days after December 31, 2023, in connection with the
solicitation of proxies for the Company's 2024 annual meeting of stockholders and is incorporated herein by reference.

 Item 11. Executive
Compensation.

by this Item is included under the headings " Executive and Director Compensation ", " Executive Compensation ",
" Director Compensation ", " Outstanding Equity Awards at Fiscal Year-End ", " Compensation
Committee Interlocks and Insider Participation " and " Compensation Committee Report " (to the extent required),
in the Company's 2024 Proxy Statement to be filed with the SEC within 120 days after December 31, 2023 and is incorporated
herein by reference.

 Item 12. Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.

by this Item is included under the heading " Voting Rights and Principal Stockholders " and " Equity Compensation
Plan Information " in the Company's 2024 Proxy Statement to be filed with the SEC within 120 days after December 31,
2023, and is incorporated herein by reference.

 Item 13. Certain
Relationships and Related Transactions, and Director Independence.

 The information required by this Item is included under the headings
" Certain Relationships and Related Transactions " and " Corporate Governance " - " Director
Independence " in the Company's 2024 Proxy Statement to be filed with the SEC within 120 days after December 31, 2023
and is incorporated herein by reference.

 Item 14. Principal
Accountant Fees and Services.

 Our independent public accounting
firm is Marcum LLP, San Francisco, CA, PCAOB Auditor ID Auditor Firm Id: 688.

by this Item is included under the heading " Ratification of Appointment of Auditors "-" Audit Fees "
in the Company's 2024 Proxy Statement to be filed with the SEC within 120 days after December 31, 2023 and is incorporated
herein by reference.

 Item 15. Exhibits,
Financial Statements and SchedULES

 (1)
 (a) Documents filed as part of this Annual Report:

 The following is an index
of the financial statements, schedules and exhibits included in this Form 10-K or incorporated herein by reference.

 All Financial Statements

 Index to Consolidated Financial Statements

 Report of Independent Registered Public Accounting Firm

 Consolidated Balance Sheets

 Consolidated Statements of Operations and Comprehensive Loss

 Consolidated Statements of Changes in Stockholders' Equity

 Consolidated Statements of Cash Flows

 Notes to Consolidated Financial Statements

 (2) Consolidated Financial Statement Schedules

 Except as provided above,
all financial statement schedules have been omitted, since the required information is not applicable or is not present in amounts sufficient
to require submission of the schedule, or because the information required is included in the consolidated financial statements and notes
thereto included in this Form 10-K.

 (3) Exhibits

 EXHIBIT INDEX

 No.

 Description

 1.1

 Placement Agent Agreement, dated April 5, 2023, between 180 Life Sciences Corp. and A.G.P./Alliance Global Partners (filed as Exhibit 1.1 to the registrant's Current Report on Form 8-K filed on April 10, 2023 and incorporated by reference herein).

 1.2

 Placement Agency Agreement, dated August 9, 2023, by and between 180 Life Sciences Corp. and A.G.P./Alliance Global Partners. (filed as Exhibit 1.1 to the registrant's Current Report on Form 8-K filed on August 15, 2023 and incorporated by reference herein).

 3.1

 Second Amended and Restated Certificate of Incorporation (filed as Exhibit 3.1 to the registrant's Current Report on Form 8-K filed on November 12, 2020 and incorporated by reference herein).

 3.2

 Certificate of Amendment of Second Amended and Restated Certificate of Incorporation, filed with the Secretary of State of Delaware on December 15, 2022 (filed as Exhibit 3.1 to the registrant's Current Report on Form 8-K filed on December 16, 2022 and incorporated by reference herein).

 3.3

 Second Amended and Restated Bylaws of 180 Life Sciences Corp., effective as of September 4, 2023 (filed as Exhibit 3.1 to the registrant's Current Report on Form 8-K filed on September 7, 2023 and incorporated by reference herein).

 4.1

 Specimen Common Stock Certificate (filed as Exhibit 4.2 to the registrant's Registration Statement Form S-1 filed on April 26, 2017 and incorporated herein by reference).

 4.2

 Description of the Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (filed as Exhibit 4.6 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Commission on March 31, 2023 and incorporated herein by reference).

 4.3

 Form of July Common Warrant (filed as Exhibit 4.2 to the registrant's Current Report on Form 8-K filed on July 19, 2022 and incorporated by reference herein).

 4.4

 Form of December Common Warrant (filed as Exhibit 4.2 to the registrant's Current Report on Form 8-K filed on December 22, 2022 and incorporated by reference herein).

 4.5

 Amendment No. 1 to the December 2022 Common Warrants, dated January 12, 2023, by and between 180 Life Sciences Corp. and the Selling Stockholder (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K filed on January 12, 2023 and incorporated by reference herein).

 4.6

 Amendment No. 1 to the Warrants, dated April 5, 2023, by and between 180 Life Sciences Corp. and the Selling Stockholder. (filed as Exhibit 10.11 to the registrant's Quarterly Report on Form 10-Q filed on May 15, 2023 and incorporated by reference herein).

 4.7

 Form of April Common Warrant (filed as Exhibit 4.2 to the registrant's Current Report on Form 8-K filed on April 10, 2023 and incorporated by reference herein).

 4.8

 Warrant Agent Agreement for Pre-Funded Warrants and Common Warrants, dated August 14, 2023, by and between 180 Life Sciences Corp. and Continental Stock Transfer & Trust Company. (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K filed on August 15, 2023 and incorporated by reference herein).

 4.9

 Form of Common Warrant (included as Annex C-2 to Exhibit 4.8). (filed as Exhibit 4.3 to the registrant's Current Report on Form 8-K filed on April 15, 2023 and incorporated by reference herein).

 4.10

 Warrant Amendment Agreement, dated August 9, 2023, by and between the Company and Armistice Capital Master Fund Ltd. (filed as Exhibit 4.4 to the registrant's Current Report on Form 8-K filed on August 15, 2023 and incorporated by reference herein).

 4.11

 Form of Warrant Agent Agreement for December 2023 Pre-Funded Warrants and Common Warrants (filed as Exhibit 4.1 to the registrant's Current Report on Form 8-K filed on November 29, 2023 and incorporated by reference herein).

 4.12

 Form of December 2023 Pre-Funded Warrant (included as Annex A to Exhibit 4.11) (filed as Exhibit 4.2 to the registrant's Current Report on Form 8-K filed on November 29, 2023 and incorporated by reference herein).

 4.13

 Form of December 2023 Common Warrant (included as Annex B to Exhibit 4.11) (filed as Exhibit 4.3 to the registrant's Current Report on Form 8-K filed on November 29, 2023 and incorporated by reference herein).

 4.14

 Warrant Amendment Agreement, dated November 28, 2023, by and between the Company and the Purchaser (filed as Exhibit 4.4 to the registrant's Current Report on Form 8-K filed on November 29, 2023 and incorporated by reference herein).

 4.15

 Description of the Registrant's Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (filed as Exhibit 4.6 to the registrant's Annual Report on Form 10-K filed on March 31, 2023 and incorporated herein by reference).

 10.1

 Registration Rights Agreement among the registrant and certain securityholders (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on June 7, 2017 and incorporated by reference herein).

 10.2

 Form of Indemnity Agreement (filed as Exhibit 10.8 to the registrant's Registration Statement Form S-1 filed on April 26, 2017 and incorporated by reference herein).

 10.3

 Form of Guarantee and Commitment Agreement (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on July 26, 2019 and incorporated herein by reference).

 10.4#

 180 Life Sciences Corp. 2020 Omnibus Incentive Plan (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on November 12, 2020 and incorporated by reference herein).

 10.5#

 Form of Stock Option Agreement (Independent Directors August 2021 Grants) (filed as Exhibit 10.9 to the registrant's Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2021 filed on August 16, 2021 and incorporated herein by reference).

 10.6#

 Form of Stock Option Agreement 180 Life Sciences Corp. 2020 Omnibus Incentive Plan (filed as Exhibit 4.2 to the registrant's Form S-8 filed on September 30, 2021 and incorporated by reference herein).

 10.7#

 Form of Restricted Stock Grant Agreement and Stock Option Agreement 180 Life Sciences Corp. 2020 Omnibus Incentive Plan (filed as Exhibit 4.3 to the registrant's Form S-8 filed on September 30, 2021 and incorporated by reference herein).

 10.8

 Promissory Note, dated March 15, 2019 issued to KBL IV Sponsor LLC (filed as Exhibit 10.13 to the registrant's Registration Statement Form S-4 filed on November 12, 2019 and incorporated by reference herein).

 10.9

 Registration Rights Agreement, dated June 12, 2020, by and among the Company and the parties signatory thereto (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on July 2, 2020 and incorporated herein by reference).

 10.10

 Registration Rights Agreement, dated September 8, 2020, by and among the Company and the parties signatory thereto (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on September 14, 2020 and incorporated herein by reference).

 10.11

 Amended and Restated Promissory Note, dated September 8, 2020, issued to KBL IV Sponsor LLC (filed as Exhibit 10.24 to the registrant's Registration Statement on Form S-1 filed on October 19, 2020 and incorporated by reference herein).

 10.12#

 Employment Agreement, dated July 1, 2020, by and between 180 Life Corp. (f/k/a 180 Life Sciences Corp.) and James N. Woody, M.D., Ph. D. (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on November 12, 2020 and incorporated by reference herein).

 10.13#

 First Amendment to Employment Agreement by and between 180 Life Corp. (f/k/a 180 Life Sciences Corp.) and James N. Woody, M.D., Ph. D. (filed as Exhibit 10.5 to the registrant's Current Report on Form 8-K filed on November 12, 2020 and incorporated herein by reference).

 10.14

 Amendment Agreement dated November 25, 2020 (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on November 27, 2020 and incorporated herein by reference).

 10.15

 Registration Rights Agreement dated as of February 23, 2021 by and between 180 Life Sciences Corp. and the purchasers signatory thereto (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on February 24, 2021 and incorporated herein by reference).

 10.16#

 Form of Lock-Up Agreement between 180 Life Sciences Corp. and its directors and executive officers (filed as Exhibit 10.5 to the registrant's Current Report on Form 8-K filed on February 24, 2021 and incorporated herein by reference).

 10.17#

 Consultancy Agreement dated February 22, 2021, by and between 180 Life Sciences Corp. and Prof. Jagdeep Nanchahal (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on March 3, 2021 and incorporated herein by reference).

 10.18#

 Amended and Restated Employment Agreement dated February 25, 2021 and effective November 6, 2020, by and between 180 Life Sciences Corp. and James N. Woody (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on March 3, 2021 and incorporated herein by reference).

 10.19#

 James N. Woody — Stock Option Agreement effective February 26, 2021 (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on March 3, 2021 and incorporated herein by reference).

 10.20#

 Employment Agreement dated February 24, 2021, and effective November 6, 2020, by and between 180 Life Sciences Corp. and Ozan Pamir and Amendment and Correction Thereto dated March 1, 2021 (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on March 3, 2021 and incorporated herein by reference).

 10.21#

 Ozan Pamir — Stock Option Agreement effective February 26, 2021 (filed as Exhibit 10.5 to the registrant's Current Report on Form 8-K filed on March 3, 2021 and incorporated herein by reference).

 10.22#

 First Amendment to Consultancy Agreement dated March 31, 2021, by and between 180 Life Sciences Corp. and Prof. Jagdeep Nanchahal (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on April 2, 2021 and incorporated herein by reference).

 10.23

 Settlement and Mutual Release Agreement dated May 4, 2021 by and between 180 Life Sciences Corp. and EarlyBirdCapital, Inc. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on May 7, 2021 and incorporated herein by reference).

 10.24#

 Second Amendment to Employment Agreement dated May 27, 2021, and effective November 6, 2020, by and between 180 Life Sciences Corp. Katexco Pharmaceuticals Corp. and Ozan Pamir (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on May 27, 2021 and incorporated herein by reference).

 10.25#

 Form of Director Nominee Offer Letter (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on May 27, 2021 and incorporated herein by reference).

 10.26#

 Employment Agreement dated August 21, 2019 between the registrant and Jonathan Rothbard (filed as Exhibit 10.44 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed on July 9, 2021 and incorporated herein by reference).

 10.27

 Mutual Release and Settlement Agreement dated as of July 31, 2021 among Alpha Capital Anstalt and the registrant (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on August 2, 2021 and incorporated herein by reference).

 10.28

 Registration Rights Agreement dated as of August 23, 2021 by and between 180 Life Sciences Corp. and the purchasers signatory thereto (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on August 24, 2021 and incorporated herein by reference).

 10.29

 Form of Lock-Up Agreement between the 180 Life Sciences Corp. and its directors and executive officers (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on August 24, 2021 and incorporated herein by reference).

 10.30

 Settlement and Mutual Release Agreement dated September 17, 2021, by and between 180 Life Sciences Corp. and Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on September 20, 2021 and incorporated herein by reference).

 10.31

 Debt Conversion Agreement dated September 30, 2021, by and between 180 Life Sciences Corp. and Dr. Lawrence Steinman and Sir Marc Feldmann (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on October 5, 2021 and incorporated by reference herein).

 10.32#

 Consulting Agreement dated November 17, 2021, by and between 180 Life Sciences Corp. and Lawrence Steinman, M.D. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on November 2, 2021 and incorporated by reference herein).

 10.33#

 First Amendment to Amended and Restated Employment Agreement dated April 27, 2022, between 180 Life Sciences Corp. and James N. Woody, M.D., Ph. D. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on April 28, 2022 and incorporated by reference herein).

 10.34#

 First Amendment to Employment Agreement dated April 27, 2022, between 180 Life Sciences Corp. and Jonathan Rothbard, Ph. D. (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on April 28, 2022 and incorporated by reference herein).

 10.35#

 First Amendment to Employment Agreement dated April 27, 2022, between Cannbiorex Pharma Ltd. and Sir Marc Feldmann, Ph. D. (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on April 28, 2022 and incorporated by reference herein).

 10.36#

 First Amendment to Consulting Agreement dated April 27, 2022, between 180 Life Sciences Corp. and Lawrence Steinman, M.D. (filed as Exhibit 10.5 to the registrant's Current Report on Form 8-K filed on April 28, 2022 and incorporated by reference herein).

 10.37#

 Second Amendment to Consulting Agreement dated April 27, 2022, between Cannbiorex Pharma Ltd. and Prof. Jagdeep Nanchahal (filed as Exhibit 10.6 to the registrant's Current Report on Form 8-K filed on April 28, 2022 and incorporated by reference herein).

 10.38#

 Second Amendment to Employment Agreement dated May 26, 2022 and effective as of June 1, 2022, between 180 Life Sciences Corp. and James N. Woody, M.D., Ph. D. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on May 26, 2022 and incorporated by reference herein).

 10.39#

 Second Amendment to Employment Agreement dated May 26, 2022 and effective as of June 1, 2022, between 180 Life Sciences Corp. and Jonathan Rothbard, Ph. D. (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on May 26, 2022 and incorporated by reference herein).

 10.40#

 Second Amendment to Consulting Agreement dated May 26, 2022 and effective as of June 1, 2022, between 180 Life Sciences Corp. and Lawrence Steinman, M.D (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on May 26, 2022 and incorporated by reference herein).

 10.41#

 180 Life Sciences Corp. 2022 Omnibus Incentive Plan (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on June 14, 2022 and incorporated by reference herein).

 10.42

 Securities Purchase Agreement dated July 17, 2022, by and between 180 Life Sciences Corp. and the Purchaser (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on July 19, 2022 and incorporated by reference herein).

 10.43

 Warrant Agent Agreement for the July 2022 Common Warrants, dated July 29, 2022, by and between 180 Life Sciences Corp. and Continental Stock Transfer & Trust Company (filed as Exhibit 10.43 to the registrant's Registration Statement on Form S-1 filed on May 5, 2023 and incorporated by reference herein).

 10.44

 Form of Lock-Up Agreement (July 2022 Offering) (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on July 19, 2022 and incorporated by reference herein).

 10.45

 Securities Purchase Agreement dated December 20, 2022, by and between 180 Life Sciences Corp. and the Purchaser (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on December 22, 2022 and incorporated by reference herein).

 10.46

 Warrant Agent Agreement for the December 2022 Common Warrants, dated December 22, 2022, by and between 180 Life Sciences Corp. and Continental Stock Transfer & Trust Company (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on December 22, 2022 and incorporated by reference herein).

 10.47

 Form of Lock-Up Agreement (December 2022 Offering) (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on December 22, 2022 and incorporated by reference herein).

 10.48#

 Third Amendment to Consulting Agreement dated December 28, 2022, between 180 Life Sciences Corp., Cannbiorex Pharma Ltd. and Prof. Jagdeep Nanchahal (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on December 29, 2022 and incorporated by reference herein).

 10.49#

 Amendment to the Warrant Agent Agreement, dated January 13, 2023, by and between 180 Life Sciences Corp. and Continental Stock Transfer & Trust Company (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on January 18, 2023 and incorporated by reference herein).

 10.50#

 Separation and Release Agreement, dated January 18, 2023, by and between 180 Life Sciences Corp. and Quan Vu (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on January 20, 2023 and incorporated by reference herein).

 10.51#

 First Amendment to Separation and Release Agreement, dated March 29, 2023, by and between 180 Life Sciences Corp. and Quan Vu (filed as Exhibit 10.59 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Commission on March 31, 2023 and incorporated herein by reference).

 10.52

 Securities Purchase Agreement dated April 10, 2023, by and between 180 Life Sciences Corp. and the Purchaser (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on April 10, 2023 and incorporated by reference herein).

 10.53

 Warrant Agent Agreement for the April 2023 Common Warrants, dated April 10, 2023 by and between 180 Life Sciences Corp. and Continental Stock Transfer & Trust Company (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on April 10, 2023 and incorporated by reference herein).

 10.54

 Form of Lock-Up Agreement (April 2023 Offering) (filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on April 10, 2023 and incorporated by reference herein).

 10.55#

 Third Amendment to Employment Agreement dated April 27, 2023 and effective as of January 1, 2023, between 180 Life Sciences Corp. and James N. Woody, M.D., Ph. D. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on April 28, 2023 and incorporated by reference herein).

 10.56#

 Third Amendment to Employment Agreement dated April 27, 2023 and effective as of January 1, 2023, between 180 Life Sciences Corp. and Ozan Pamir (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on April 28, 2023 and incorporated by reference herein).

 10.57#

 Third Amendment to Employment Agreement dated April 27, 2023 and effective as of January 1, 2023, between 180 Life Sciences Corp. and Jonathan Rothbard, Ph. D. (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on April 28, 2023 and incorporated by reference herein).

 10.58#

 Amended and Corrected Third Amendment to Employment Agreement dated May 9, 2023, between 180 Life Sciences Corp. and Ozan Pamir (filed as Exhibit 10.12 to the registrant's Quarterly Report on Form 10-Q filed on May 15, 2023 and incorporated by reference herein).

 10.59#

 First Amended and Restated 180 Life Sciences Corp. 2022 Omnibus Incentive Plan (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on July 10, 2023 and incorporated by reference herein).

 10.60

 Securities Purchase Agreement dated August 9, 2023, by and between 180 Life Sciences Corp. and the Institutional Investor. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on August 15, 2023 and incorporated by reference herein).

 10.61

 Form of Lock-Up Agreement (incorporated by reference to Exhibit 10.56 to the Company's Registration Statement on Form S-1 (File No. 333-272749) filed on June 16, 2023).

 10.62#

 Form of Stock Option Agreement (First Amended and Restated 2022 Omnibus Incentive Plan) (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on September 7, 2023 and incorporated by reference herein).

 10.63

 Termination Letter (Oxford License) September 22, 2023 (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on September 28, 2023 and incorporated by reference herein).

 10.64

 Amendment No. 1 to the Securities Purchase Agreement, dated November 28, 2023, by and between 180 Life Sciences Corp. and the Purchaser (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on November 29, 2023 and incorporated by reference herein).

 10.65#

 Fourth Amendment to Employment Agreement dated January 10, 2024 and effective as of January 1, 2024, between 180 Life Sciences Corp. and James N. Woody, M.D., Ph. D. (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on January 17, 2024 and incorporated by reference herein).

 10.66#

 Fourth Amendment to Employment Agreement dated January 10, 2024 and effective as of January 1, 2024, between 180 Life Sciences Corp. and Jonathan Rothbard, Ph. D. (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on January 17, 2024 and incorporated by reference herein).

 10.67#

 Third Amendment to Consulting Agreement dated January 10, 2024 and effective as of January 1, 2024, between 180 Life Sciences Corp. and Lawrence Steinman, M.D. (filed as Exhibit 10.3 to the registrant's Current Report on Form 8-K filed on January 17, 2024 and incorporated by reference herein).

 10.68#

 Second Amendment to Consulting Agreement dated January 10, 2024 and effective as of January 1, 2024, between Cannbiorex Pharma Ltd. and Sir Marc Feldmann(filed as Exhibit 10.4 to the registrant's Current Report on Form 8-K filed on January 17, 2024 and incorporated by reference herein).

 10.69#

 Offer Letter between 180 Life Science Corp. and Blair Jordan (director) dated February 24, 2024 and effective February 28, 2024 (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on February 29, 2024 and incorporated by reference herein).

 10.70#

 Offer Letter between 180 Life Science Corp. and Omar Jimenez (director) dated March 4, 2024 and effective March 7, 2024 (filed as Exhibit 10.1 to the registrant's Current Report on Form 8-K filed on March 11, 2024 and incorporated by reference herein).

 10.71#

 Offer Letter between 180 Life Science Corp. and Ryan L. Smith (director) dated March 5, 2024 and effective March 7, 2024 (filed as Exhibit 10.2 to the registrant's Current Report on Form 8-K filed on March 11, 2024 and incorporated by reference herein).

 14.1#

 Code of Business and Ethics (filed as Exhibit 14 to the registrant's Registration Statement on Form S-1 filed on April 26, 2017 and incorporated herein by reference)(File. No. 333-217475)

 21.1

 List of Subsidiaries (filed as Exhibit 21.1 to the registrant's Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the Commission on March 31, 2023 and incorporated herein by reference).

 23.1*

 Consent of Marcum LLP, independent registered public accounting firm

 31.1*

 Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act

 31.2*

 Certification of Principal Accounting Officer pursuant to Section 302 of the Sarbanes-Oxley Act

 32.1**

 Certification of Principal Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act

 32.2**

 Certification of Principal Accounting Officer Pursuant to Section 906 of the Sarbanes-Oxley Act

 97.1

 180 Life Sciences Corp., Policy for the Recovery of Erroneously Awarded Incentive-Based Compensation (filed as Exhibit 10.4 to the Quarterly Report on Form 10-Q filed by the registrant on November 9, 2023, and incorporated herein by reference).

 101.INS*

 101.SCH*

 101.CAL*

 101.DEF*

 101.LAB*

 101.PRE*

 104*

 *
 Filed herewith.

 **
 Furnished herewith.

 #
 Management contract or compensatory plans or arrangements.

 Certain schedules, annexes and similar attachments have been
omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the
Securities and Exchange Commission upon request; provided, however that 180 Life Sciences Corp. may request confidential treatment pursuant
to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

 Item 16. Form
10–K Summary

 None.

 SIGNATURES

 Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

 180 LIFE SCIENCES CORP.

 Date: March 22, 2024

 /s/ James N. Woody

 By:

 James N. Woody, Chief Executive Officer

(Principal Executive Officer)

 Date: March 22, 2024

 /s/ Ozan Pamir

 By:

 Ozan Pamir, Chief Financial Officer

(Principal Financial and Accounting Officer)

 Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in
the capacities and on the dates indicated.

 Signature

 Title

 Date

 /s/ James N. Woody

 Chief Executive Officer and Director

 James N. Woody

 (Principal Executive Officer)

 /s/ Ozan Pamir

 Chief Financial Officer

 Ozan Pamir

 (Principal Financial and Accounting Officer)

 /s/ Lawrence Steinman

 Executive Chairman and Director

 Lawrence Steinman

 /s/ Blair Jordan

 Lead Director

 Blair Jordan

 /s/ Omar Jimenez

 Director

 Omar Jimenez

 /s/ Ryan L. Smith

 Director

 Ryan L. Smith

 CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER
31, 2023 AND 2022

 Page

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PCAOB ID 688)

 CONSOLIDATED FINANCIAL STATEMENTS:

 Consolidated Balance Sheets as of December 31, 2023 and 2022

 Consolidated Statements of Operations and Comprehensive Loss For the Years Ended December 31, 2023 and 2022

 Consolidated Statements of Changes in Stockholders' (Deficit) Equity For the Years Ended December 31,
 2023 and 2022

 Consolidated Statements of Cash Flows For the Years Ended December 31, 2023 and 2022

 Notes to Consolidated Financial Statements

 F- 1

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM

 To the Shareholders and Board of Directors of

 180 Life Sciences Corp.

 Opinion on the Financial Statements

 We have audited the accompanying consolidated
balance sheets of 180 Life Sciences Corp. (the "Company") as of December 31, 2023 and 2022, the related consolidated statements
of operations and comprehensive loss, changes in stockholders' equity (deficit) and cash flows for each of the two years in the
period ended December 31, 2023, and the related notes (collectively referred to as the "financial statements"). In our opinion,
the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and
the results of its operations and its cash flows for each of the two years in the period ended December 31, 2023, in conformity with accounting
principles generally accepted in the United States of America.

 Explanatory Paragraph – Going Concern

 The accompanying financial statements have been
prepared assuming that the Company will continue as a going concern. As more fully described in Note 2, the Company has a significant
working capital deficiency, has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans in
regard to these matters are also described in Note 2. The financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

 Basis for Opinion

 These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We
are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

 We conducted our audits in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting.

 As part of our audits we are required to obtain
an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of
the Company's internal control over financial reporting. Accordingly, we express no such opinion.

 Our audits included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audit s provide a reasonable basis for our opinion.

 Critical Audit Matters

 Critical audit matters are matters arising from
the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and
that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,
subjective, or complex judgments. We determined that there are no critical audit matters.

 /s/ Marcum llp

 Marcum llp

 We have served as the Company's auditor since 2019

 San Francisco, California

 PCAOB ID #688

 F- 2

 CONSOLIDATED BALANCE SHEETS

 2023

 2022

 Assets

 Current Assets:

 Cash

 $
 1,975,799

 $
 6,970,110

 Prepaid expenses and other current assets

 1,664,107

 1,958,280

 Total Current Assets

 3,639,906

 8,928,390

 Intangible assets, net

 1,619,570

 1,658,858

 In-process research and development

 -

 9,063,000

 Total Assets

 $
 5,259,476

 $
 19,650,248

 Liabilities and Stockholders' Equity

 Current Liabilities:

 Accounts payable

 $
 1,892,611

 $
 1,801,210

 Accounts payable – related parties

 266,009

 -

 Accrued expenses

 1,869,814

 2,284,516

 Accrued expenses - related parties

 -

 188,159

 Loans payable - current portion

 1,034,124

 1,308,516

 Derivative liabilities

 75,381

 Total Current Liabilities

 5,062,616

 5,657,782

 Loans payable - noncurrent portion

 19,936

 31,189

 Deferred tax liability

 304,657

 2,617,359

 Total Liabilities

 5,387,209

 8,306,330

 Commitments and contingencies (Note 9)

 Stockholders' (Deficit) Equity:

 Preferred stock, $ 0.0001 par value; 5,000,000 shares authorized; (see designations and shares authorized for Series A, Class C and Class K preferred stock)

 Class C Preferred Stock; 1 share authorized, issued and outstanding at December 31, 2023 and 2022

 -

 -

 Class K Preferred Stock; 1 share authorized, issued and outstanding at December 31, 2023 and 2022

 -

 -

 Common stock, $ 0.0001 par value; 100,000,000 shares authorized; 534,719 and 197,209 shares issued and outstanding at December 31, 2023 and 2022, respectively

 Additional paid-in capital

 130,117,209

 121,637,966

 Accumulated other comprehensive income

 ( 2,901,339
)

 ( 2,885,523
)

 Accumulated deficit

 ( 127,343,657
)

 ( 107,408,545
)

 Total Stockholders' (Deficit) Equity

 ( 127,733
)

 11,343,918

 Total Liabilities and Stockholders' Equity

 $
 5,259,476

 $
 19,650,248

 F- 3

 CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE
LOSS

 For the Year Ended

 2023

 2022

 Operating Expenses:

 Research and development

 $
 2,303,751

 $
 2,191,834

 Research and development - related parties

 480,777

 240,731

 General and administrative

 10,646,417

 15,459,788

 General and administrative - related parties

 46,555

 5,612

 Total Operating Expenses

 13,477,500

 17,897,965

 Loss From Operations

 ( 13,477,500
)

 ( 17,897,965
)

 Other Income (Expenses):

 Other income

 21,074

 -

 Interest expense

 ( 44,828
)

 ( 28,175
)

 Interest income – related parties

 -

 1,508

 Loss on goodwill impairment

 -

 ( 33,547,278
)

 Loss on IP R&D impairment

 ( 9,063,000
)

 ( 3,342,084
)

 75,323

 15,144,986

 Gain on settlement of accrued liability

 204,405

 -

 Total Other Expense, Net

 ( 8,807,026
)

 ( 21,771,043
)

 Net Loss Before Income Taxes

 ( 22,284,526
)

 ( 39,669,008
)

 Income tax benefit

 2,349,414

 942,749

 Net Loss

 $
 ( 19,935,112
)

 $
 ( 38,726,259
)

 Other Comprehensive Loss:

 Foreign currency translation adjustments

 ( 15,816
)

 ( 3,702,963
)

 Total Comprehensive Loss

 $
 ( 19,950,928
)

 $
 ( 42,429,222
)

 Basic and Diluted Net Loss per Common Share

 $
 ( 52.59
)

 $
 ( 387.18
)

 Weighted Average Number of Common Shares Outstanding:

 379,089

 100,021

 F- 4

 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
EQUITY (DEFICIT)

 For The Year Ended December 31, 2023

 Common Stock

 Additional
 Paid-in

 Other
 Comprehensive

 Total
 Stockholders'

Equity

 Capital

 Income

 Deficit

 (Deficit)

 Balance - January 1, 2023

 197,209

 $

 $
 121,637,966

 $
 ( 2,885,523
)

 $
 ( 107,408,545
)

 $
 11,343,918

 Adjustment related to reverse stock split

 ( 1
)

 -

 -

 -

 Shares issued for professional services to directors

 4,763

 -

 60,624

 -

 -

 60,624

 Shares issued for professional services to executive chairman

 7,126

 28,564

 -

 -

 28,565

 Issuance of April 2023 pre-funded and common warrants, net (a)

 -

 -

 2,337,706

 -

 -

 2,337,706

 Shares issued from exercise of April 2023 pre-funded warrants (a)

 61,615

 -

 -

 Shares issued in connection with April 2023 Offering (a)

 21,053

 382,180

 -

 -

 382,182

 Issuance of August 2023 pre-funded and common warrants, net (b)

 -

 -

 2,459,282

 -

 -

 2,459,282

 Shares issued from exercise of August 2023 pre-funded warrants (b)

 207,814

 -

 -

 Shares issued in connection with August 2023 Offering (b)

 35,102

 245,344

 -

 -

 245,348

 Issuance of pre-funded and common warrants from Amendment to
 August 2023 SPA, net

 -

 -

 770,923

 -

 -

 770,923

 Stock-based compensation

 -

 -

 2,194,135

 -

 -

 2,194,135

 Comprehensive loss:

 Net loss

 -

 -

 -

 -

 ( 19,935,112
)

 ( 19,935,112
)

 Other comprehensive loss

 -

 -

 -

 ( 15,816
)

 -

 ( 15,816
)

 Balance - December 31, 2023

 534,719

 $

 $
 130,117,209

 $
 ( 2,901,339
)

 $
 ( 127,343,657
)

 $
 ( 127,733
)

 (a)
 Consists of $2,999,882 of gross proceeds from the April 2023 Offering; gross proceeds of $421,527 are related to common shares issued (with related placement agent fees of $39,343), gross proceeds of $1,233,564 are related to pre-funded warrants issued (with related placement agent fees of $115,134) and gross proceeds of $1,344,791 are related to common warrants issued (with related placement agent fees of $125,516). At the end of the current period, all 61,615 April 2023 pre-funded warrants were exercised for proceeds of $117.

 (b)
 Consists of $2,999,605 of gross proceeds from the August 2023 Offering; gross proceeds of $272,106 are related to common shares issued (with related placement agent fees of $26,758), gross proceeds of $1,449,470 are related to pre-funded warrants issued (with related placement agent fees of $142,538) and gross proceeds of $1,278,029 are related to common warrants issued (with related placement agent fees of $125,679). At the end of the year, 207,814 August 2023 pre-funded warrants were exercised for proceeds of $395.

 F- 5

 CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS'
(DEFICIT) EQUITY, continued

 For The Year Ended December 31, 2022

 Common Stock

 Additional
 Paid-in

 Other
 Comprehensive

 Total
 Stockholders'

 Capital

 Income

 Deficit

 Equity

 Balance - January 1, 2022

 89,569

 $

 $
 107,187,532

 $
 817,440

 $
 ( 68,682,286
)

 $
 39,322,695

 Adjustments related to reverse stock-split

 -

 -

 -

 -

 -

 Issuance of July 2022 pre-funded warrants (c)

 -

 -

 2,562,265

 -

 -

 2,562,265

 Shares issued from exercise of July 2022 pre-funded warrants (c)

 6,297

 -

 -

 Shares issued in connection with July 2022 Offering (c)

 9,211

 3,407,489

 -

 -

 3,407,490

 Issuance of December 2022 pre-funded warrants

 -

 -

 4,823,187

 -

 -

 4,823,187

 Shares issued from exercise of December 2022 pre-funded warrants

 78,910

 -

 -

 Shares issued in connection with December 2022 Offering

 11,316

 691,672

 -

 -

 691,673

 Shares issued for professional services to directors

 -

 331,591

 -

 -

 331,591

 Stock-based compensation

 -

 2,633,826

 -

 -

 2,633,826

 Comprehensive loss:

 Net loss

 -

 -

 -

 -

 ( 38,726,259
)

 ( 38,726,259
)

 Other comprehensive loss

 -

 -

 -

 ( 3,702,963
)

 -

 ( 3,702,963
)

 Balance - December 31, 2022

 197,209

 $

 $
 121,637,966

 $
 ( 2,885,523
)

 $
 ( 107,408,545
)

 $
 11,343,918

 (c)
 Consists of $6,499,737 of gross proceeds from the July 2022 Offering; gross proceeds of $3,710,000 are related to the common shares and common warrants issued and includes $302,510 in related placement agent fees and other offering costs, and $2,789,737 in gross proceeds are in connection with the pre-funded warrants and includes $227,472 in related placement agent fees and other offering costs. At the end of the period, 81,426 July 2022 pre-funded warrants were exercised for proceeds of $155.

 F- 6

 CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS

 2023

 2022

 Cash Flows from Operating Activities

 Net loss

 $
 ( 19,935,112
)

 $
 ( 38,726,259
)

 Adjustments to reconcile net loss to net cash used in operating activities:

 Stock-based compensation

 Shares issued for services

 89,189

 331,591

 Amortization of stock options and restricted stock units

 2,194,135

 2,633,826

 Impairment of goodwill

 -

 33,547,278

 Impairment of IP R&D assets

 9,063,000

 3,342,084

 Amortization of intangibles

 105,675

 109,004

 Deferred tax liability

 ( 2,349,683
)

 ( 942,749
)

 ( 75,323
)

 ( 15,144,986
)

 Changes in operating assets and liabilities:

 Prepaid expenses and other current assets

 337,282

 1,018,303

 Accounts payable

 230,402

 1,214,599

 Accounts payable – related parties

 56,008

 -

 Accrued expenses

 ( 440,621
)

 319,936

 Accrued expenses – related parties

 ( 197,175
)

 169,788

 Total adjustments

 9,012,889

 26,598,674

 Net Cash Used in Operating Activities

 ( 10,922,223
)

 ( 12,127,585
)

 Cash Flows from Financing Activities

 Offering costs in connection with July 2022 sale of common stock and common stock warrants

 -

 ( 529,982
)

 Offering costs in connection with December 2022 sale of common stock and common stock warrants

 -

 ( 484,991
)

 Offering costs in connection with April 2023 sale of common stock and common stock warrants

 ( 279,994
)

 -

 Offering costs in connection with August 2023 sale of common stock and common stock warrants

 ( 294,976
)

 -

 Offering costs in connection with the repricing of the August 2023 Offering

 ( 59,846
)

 -

 Proceeds from loans payable (Note 8)

 969,322

 Repayment of loans payable, net of adjustments (Note 8)

 ( 1,257,388
)

 ( 1,591,035
)

 Repayment of loans payable – related parties

 -

 ( 81,277
)

 Proceeds from sale of July 2022 common stock and common stock warrants

 -

 6,499,737

 Proceeds from sale of December 2022 common stock and common stock warrants

 -

 5,999,851

 Proceeds from sale of April 2023 common stock and common stock warrants

 2,999,882

 Proceeds from sale of August 2023 common stock and common stock warrants

 2,999,606

 Proceeds from exercise of July 2022 pre-funded warrants

 -

 Proceeds from exercise of December 2022 pre-funded warrants

 -

 Proceeds from exercise of April 2023 pre-funded warrants

 -

 Proceeds from exercise of August 2023 pre-funded warrants

 -

 Proceeds from the repricing of common shares and pre-funded warrants in the August 2023 Offering

 830,769

 -

 Net Cash Provided by Financing Activities

 5,907,887

 10,873,606

 F- 7

 CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS, continued

 2023

 2022

 Effect of Exchange Rate Changes on Cash

 20,025

 ( 419
)

 Net Decrease In Cash

 ( 4,994,311
)

 ( 1,254,398
)

 Cash - Beginning of Period

 6,970,110

 8,224,508

 Cash - End of Period

 $
 1,975,799

 $
 6,970,110

 Supplemental Disclosures of Cash Flow Information:

 Cash paid during the period for income taxes

 $
 -

 $
 -

 Cash paid during the period for interest

 $
 21,722

 $
 15,060

 F- 8

 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 (Amounts in US Dollars, except share amounts)

 NOTE 1 - BUSINESS ORGANIZATION AND NATURE OF
OPERATIONS

 180 Life Sciences Corp., formerly
known as KBL Merger Corp. IV ("180LS", or together with its subsidiaries, the "Company"), was a blank check company
organized under the laws of the State of Delaware on September 7, 2016. The Company was formed for the purpose of effecting a merger,
share exchange, asset acquisition, share purchase, reorganization, or similar business combination with one or more businesses.

 180 Life Corp. ("180",
f/k/a 180 Life Sciences Corp. and CannBioRx Life Sciences Corp.) is a wholly-owned subsidiary of the Company and was incorporated in the
State of Delaware on January 28, 2019. The Company is located in the United States ("U.S.") and is a medical pharmaceutical
company focused upon unmet medical needs in the areas of inflammatory diseases, fibrosis, and chronic pain by employing innovative research
and, where appropriate, combination therapies, through 180's three wholly-owned subsidiaries, 180 Therapeutics L.P. ("180
LP"), CannBioRex Pharmaceuticals Corp. ("CBR Pharma"), and Katexco Pharmaceuticals Corp. ("Katexco"). 180
LP, CBR Pharma and Katexco are together, the "180 Subsidiaries." Katexco was incorporated on March 7, 2018 under the provisions
of the British Corporation Act of British Columbia. Additionally, 180's wholly-owned subsidiaries Katexco Callco, ULC, Katexco Purchaseco,
ULC, CannBioRex Callco, ULC, and CannBioRex Purchaseco, ULC were formed in the Canadian Province of British Columbia on May 31, 2019 to
facilitate the acquisition of Katexco, CBR Pharma and 180 LP. On July 1, 2021, the assets and liabilities of the Canadian companies (Katexco
and CBR Pharma) were transferred to their respective subsidiaries, which are Katexco Pharmaceuticals Corp. ("Katexco U.S.")
and CannBioRex Pharma Limited ("CBR Pharma U.K.").

 The Company is a clinical
stage biotechnology company focused on the development of therapeutics for unmet medical needs in chronic pain, inflammation, fibrosis,
and other inflammatory diseases, where anti-TNF therapy will provide a clear benefit to patients, by employing innovative research, and,
where appropriate, combination therapy. We have three product development platforms:

 fibrosis and anti-tumor necrosis factor ("TNF");

 drugs which are derivatives of cannabidiol ("CBD"); and

 alpha 7 nicotinic acetylcholine receptor (" 7nAChR").

 Due
to restrictions in the Company's resources, the Company has not made progress in the 7nAChR platform and has suspended further
research and development activity in the meantime.

 Risks and Uncertainties

 Management continues to evaluate
the impact of the COVID-19 pandemic, the Russia-Ukraine war, the Israel-Hamas war and fluctuating interest rates on the economy and the
capital markets and has concluded that, while it is reasonably possible that such events could have negative effects on the Company's
financial position, the specific impacts are not readily determinable as of the date of these consolidated financial statements. The consolidated
financial statements do not include any adjustments that might result from the outcome of these uncertainties.

 The current challenging economic
climate may lead to adverse changes in cash flows, working capital levels and/or debt balances, which may also have a direct impact on
the Company's future operating results and financial position. The ultimate duration and magnitude of the impact and the efficacy
of government interventions on the economy and the financial effect on the Company is not known at this time. The extent of such impact
will depend on future developments, which are highly uncertain and not in the Company's control.

 Reverse Stock-Split during 2024

 On February 26, 2024, the
Company's Board of Directors approved a one-for-19 reverse stock split of the Company's outstanding common stock
and the filing of a Certificate of Amendment to our Certificate of Incorporation to affect such reverse stock split, which was filed on
February 26, 2024. The Reverse Stock Split became effective on February 28, 2024 at 12:01 a.m. Eastern Time, with shares beginning trading
on a split-adjusted basis at market open on February 28, 2024. In connection with the Reverse Stock Split, every 19 shares of the Company's
common stock issued and outstanding as of the Effective Time were automatically converted into one share of the Company's common
stock.

 In connection with the reverse
split, all outstanding options, warrants, and other securities entitling their holders to purchase or otherwise receive shares of common
stock were adjusted, as required by the terms of each security. The number of shares available to be awarded under the Company's
equity incentive plans were also appropriately adjusted. Following the reverse split, the par value of the Common Stock remained unchanged
at $ 0.0001 par value per share. The reverse split did not change the authorized number of shares of common stock or preferred stock. No
fractional shares were issued in connection with the reverse split, and stockholders who would otherwise be entitled to receive a fractional
share instead received one whole share of common stock in lieu of such fractional share.

 The effects of the 1-for-19 Reverse Stock Split have been retroactively
reflected throughout this Report; see Note 13 – Subsequent Events for additional details.

 F- 9

 NOTE 2 - GOING CONCERN AND MANAGEMENT'S
PLANS

 The Company has not generated
any revenues and has incurred significant losses since inception. As of December 31, 2023, the Company had an accumulated deficit of
$ 127,343,657 and working capital deficit of $ 1,422,710 and for the year ended December 31, 2023, a net loss of $ 19,935,112 and cash used
in operating activities of $ 10,922,223. The Company expects to invest a significant amount of capital to fund research and development.
As a result, the Company expects that its operating expenses will increase significantly, and consequently will require significant revenues
to become profitable. Even if the Company does become profitable, it may not be able to sustain or increase profitability on a quarterly
or annual basis. The Company cannot predict when, if ever, it will be profitable. There can be no assurance that the intellectual property
of the Company, or other technologies it may acquire, will meet applicable regulatory standards, obtain required regulatory approvals,
be capable of being produced in commercial quantities at reasonable costs, or be successfully marketed. The Company plans to undertake
additional laboratory studies with respect to the intellectual property, and there can be no assurance that the results from such studies
or trials will result in a commercially viable product or will not identify unwanted side effects.

 These consolidated financial
statements have been prepared under the assumption of a going concern, which assumes that the Company will be able to realize its assets
and discharge its liabilities in the normal course of business. The Company's ability to continue its operations is dependent upon
obtaining new financing for its ongoing operations. Future financing options available to the Company include equity financings and loans
and if the Company is unable to obtain such additional financing timely, or on favorable terms, the Company may have to curtail its development,
marketing and promotional activities, which would have a material adverse effect on its business, financial condition and results of operations,
and it could ultimately be forced to discontinue its operations and liquidate. These matters raise substantial doubt about the Company's
ability to continue as a going concern for a reasonable period of time, which is defined as within one year after the date that the consolidated
financial statements are issued. Realization of the Company's assets may be substantially different from the carrying amounts presented
in these consolidated financial statements and the accompanying consolidated financial statements do not include any adjustments that
may become necessary, should the Company be unable to continue as a going concern.

 NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES

 Basis of Presentation

 The accompanying consolidated
financial statements have been prepared in accordance with accounting principles generally accepted in the Unites States of America ("U.S.
GAAP").

 Principles of Consolidation

 The consolidated financial
statements include the accounts of the Company and its wholly-owned subsidiaries 180 LP, CBR Pharma, Katexco and 180 Life Corp. ("180LC").
All inter-company balances and transactions among the companies have been eliminated upon consolidation. The consolidated financial statements
are presented in U.S. Dollars.

 Use of Estimates

 The preparation of financial statements in conformity with U.S. GAAP
requires management to make estimates, judgments, and assumptions that affect the reported amounts of assets, liabilities, revenues and
expenses, together with amounts disclosed in the related notes to the consolidated financial statements. The Company's significant
estimates and assumptions used in these financial statements include, but are not limited to, the fair value of financial instruments,
warrants, options and derivative liabilities; R&D tax credits and accruals, and the estimates and assumptions related to the impairment
analysis of IP R&D assets. Certain of the Company's estimates could be affected by external conditions, including those unique
to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company's
estimates and may cause actual results to differ from those estimates.

 Foreign Currency Translation

 The Company's reporting
currency is the United States dollar. The functional currency of certain subsidiaries is the Canadian Dollar ("CAD") or British
Pound ("GBP"). Assets and liabilities are translated based on the exchange rates at the balance sheet date (0.7547 and 0.7369
for the CAD, 1.2730 and 1.2098 for the GBP as of December 31, 2023 and 2022, respectively), while expense accounts are translated at the
weighted average exchange rate for the period (0.7458 and 0.7689 for the CAD, and 1.2667 and 1.2173 for the GBP for the years ended December
31, 2023 and 2022, respectively). Equity accounts are translated at historical exchange rates. The resulting translation adjustments are
recognized in stockholders' (deficit) equity as a component of accumulated other comprehensive income.

 Comprehensive income is defined
as the change in equity of an entity from all sources other than investments by owners or distributions to owners and includes foreign
currency translation adjustments as described above. During the years ended December 31, 2023 and 2022, the Company recorded other comprehensive
loss of $ 15,816 and $ 3,702,963, respectively, as a result of foreign currency translation adjustments.

 Foreign currency gains and
losses resulting from transactions denominated in foreign currencies, including intercompany transactions, are included in results of
operations. The Company recognized $ 2,380 and $ 12,777 in foreign currency transaction losses for the years ended December 31, 2023 and
2022, respectively. Such amounts have been classified within general and administrative expenses in the accompanying consolidated statements
of operations and comprehensive loss.

 F- 10

 Cash and Cash Equivalents

 The Company considers all
highly liquid investments with an original maturity of three months or less to be cash equivalents in the financial statements. The Company
had no cash equivalents at December 31, 2023 or 2022. As of December 31, 2023, the Company had bank accounts in the United States and
the United Kingdom; of its available cash balance, $ 25,474 is restricted cash. The Company's cash deposits in United States and
English financial institutions may at times be in excess of the Federal Deposit Insurance Corporation ("FDIC") or the Financial
Services Compensation Scheme ("FSCS") insurance limits, respectively. The Company has not experienced losses in such accounts
and periodically evaluates the creditworthiness of its financial institutions.

 Goodwill

 Goodwill represents the difference
between the purchase price and the fair value of assets and liabilities acquired in a business combination. The Company reviews goodwill
yearly, or more frequently whenever circumstances and situations change such that there is an indication that the carrying amounts may
not be recovered, for impairment by initially considering qualitative factors to determine whether it is more likely than not that the
fair value of a reporting unit is less than its carrying amount, including goodwill, as a basis for determining whether it is necessary
to perform a quantitative analysis. If it is determined that it is more likely than not that the fair value of a reporting unit is less
than its carrying amount, a quantitative analysis is performed to identify goodwill impairment. If it is determined that it is not more
likely than not that the fair value of the reporting unit is less than its carrying amount, it is unnecessary to perform a quantitative
analysis. The Company may elect to bypass the qualitative assessment and proceed directly to performing a quantitative analysis. See "Note
5 – Intangible Assets and Impairment of Long-lived Assets" for further information.

 Intangible Assets and In-Process Research and
Development ("IP R&D")

 Intangible assets consist
of licensed patents held by Katexco as well as technology licenses acquired in connection with the Reorganization. Licensed patents are
amortized over the remaining life of the patent. Technology licenses represent the fair value of licenses acquired for the development
and commercialization of certain licenses and knowledge. The technology licenses are amortized on a straight-line basis over the estimated
useful lives of the underlying patents. It will be necessary to monitor and possibly adjust the useful lives of the licensed patents and
technology licenses depending on the results of the Company's research and development activities.

 IP R&D assets represent
the fair value assigned to technologies that were acquired on July 16, 2019 in connection with the Reorganization, which have not reached
technological feasibility and have no alternative future use. IP R&D assets are considered to have indefinite-lives until the completion
or abandonment of the associated research and development projects. During the period that the IP R&D assets are considered indefinite-lived,
they are tested for impairment on an annual basis, or more frequently if the Company becomes aware of any events occurring or changes
in circumstances that indicate that the fair value of the IP R&D assets are less than their carrying amounts. If and when development
is complete, which generally occurs upon regulatory approval, and the Company is able to commercialize products associated with the IP
R&D assets, these assets are then deemed definite-lived and are amortized based on their estimated useful lives at that point in time.
If development is terminated or abandoned, the Company may record a full or partial impairment charge related to the IP R&D assets,
calculated as the excess of the carrying value of the IP R&D assets over their estimated fair value. During 2023, the Company recorded
a loss on impairment to IP R&D assets in the amount of $ 9,063,000, and as of December 31, 2023 and 2022, the balance of the IP R&D
assets on the balance sheet was $ 0 and $ 9,063,000, respectively. See "Note 5 – Intangible Assets and Impairment of Long-lived
Assets" for further information.

 Fair Value of Financial Instruments

 The Company measures the fair
value of financial assets and liabilities based on the guidance of Accounting Standards Codification ("ASC") 820 "Fair
Value Measurements" ("ASC 820"), which defines fair value, establishes a framework for measuring fair value, and expands
disclosures about fair value measurements.

 F- 11

 ASC 820 defines fair value
as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous
market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes
a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs
when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:

 Level 1 - Quoted prices in active markets for identical assets or liabilities;

 Level 2 - Quoted prices for similar assets and liabilities in active markets or inputs that are observable; and

 Level 3 - Inputs that are unobservable (for example, cash flow modeling inputs based on assumptions).

 The carrying amounts of certain
of the Company's financial instruments, consisting primarily of loans payable, approximate their fair values as presented in these
consolidated financial statements due to the short-term nature of those instruments. The Company's derivative liabilities were valued
using level 3 inputs (see Note 7 – Derivative Liabilities for additional information).

 Stock-Based Compensation

 The Company measures the cost
of services received in exchange for an award of equity instruments based on the fair value of the award. The fair value of the award
is measured on the grant date and is estimated by management based on observations of the recent cash sales prices of common stock. The
fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually
the vesting period. Upon the exercise of an option or warrant, the Company issues new shares of common stock out of its authorized but
unissued shares.

 Derivative Liabilities and Convertible
Instruments

 The Company evaluates its
debt and equity issuances to determine if those contracts or embedded components of those contracts qualify as derivatives requiring separate
recognition in the Company's financial statements. Entities must consider whether to classify contracts that may be settled in its
own stock, such as warrants, as equity of the entity or as an asset or liability. If an event that is not within the entity's control
could require net cash settlement, then the contract should be classified as an asset or a liability rather than as equity.

 The result of this accounting
treatment is that the fair value of the embedded derivative is marked-to-market at each balance sheet date and recorded as a liability
and the change in fair value is recorded in other (expense) income, net in the consolidated statements of operations. In circumstances
where there are multiple embedded instruments that are required to be bifurcated, the bifurcated derivative instruments are
accounted for as a single, compound derivative instrument. The classification of derivative instruments, including whether such instruments
should be recorded as liabilities or as equity, is reassessed at the end of each reporting period. Equity instruments that are initially
classified as equity that become subject to reclassification are reclassified to liability at the fair value of the instrument on the
reclassification date. Derivative instrument liabilities are classified in the balance sheet as current or non-current based on whether
or not net-cash settlement of the derivative instrument is expected within twelve months of the balance sheet date.

 F- 12

 If the embedded conversion
options do not require bifurcation, the Company then evaluates for the existence of a beneficial conversion feature by comparing the fair
value of the Company's underlying stock as of the commitment date to the effective conversion price of the instrument (the intrinsic
value).

 Debt discounts under these
arrangements are amortized over the term of the related debt to their stated date of redemption and are classified in interest expense
in the consolidated statements of operations. Preferred stock discounts are only accreted to their redemption value if redemption becomes
probable.

 Amendments to convertible
instruments are evaluated as to whether they should be accounted for as a modification of the original instrument with no change to the
accounting or, if the terms are substantially changed, as an extinguishment of the original instrument and the issuance of a new instrument.

 The Company has computed the
fair value of warrants and options issued using the Black-Scholes option pricing model. The expected term used for warrants, convertible
notes and convertible preferred stock are the contractual life and the expected term used for options issued is the estimated period of
time that options granted are expected to be outstanding. The Company utilizes the "simplified" method to develop an estimate
of the expected term of "plain vanilla" option grants. The Company is utilizing an expected volatility figure based on a review
of the historical volatilities, over a period of time, equivalent to the expected life of the instrument being valued, of similarly positioned
public companies within its industry. The risk-free interest rate was determined from the implied yields from U.S. Treasury zero-coupon
bonds with a remaining term consistent with the expected term of the instrument being valued.

 Net Loss Per Common Share

 Basic net loss per common
share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss
per common share is computed by dividing net loss by the weighted average number of common shares outstanding, plus the number of additional
common shares that would have been outstanding if the common share equivalents had been issued (computed using the treasury stock or if
converted method), if dilutive.

 The following common share
equivalents are excluded from the calculation of weighted average common shares outstanding, because their inclusion would have been anti-dilutive:

 2023

 2022

 Options

 17,788

 8,561

 983,473
 (1)

 180,832

 Total potentially dilutive shares

 1,001,261

 189,393

 (1)
 Note that amount excludes 257,205 warrants that require holders
to pay a nominal amount of consideration; such underlying shares are included in the weighted average outstanding shares calculation
for the purposes of basic earnings per share as of December 31, 2023. As such, this number of warrants will differ from those disclosed
in Note 7 by the same amount.

 Research and Development

 Research and development expenses
are charged to operations as incurred. During the years ended December 31, 2023 and 2022, the Company incurred $ 2,303,751 and $ 2,191,834,
respectively, of research and development expenses. As of December 31, 2023 and 2022, research and development expenses – related
parties were $ 480,777 and $ 240,731, respectively. See Note 12 – Related Parties for more information on research and development
expenses – related parties.

 Income Taxes

 The Company accounts for income
taxes under the provisions of ASC Topic 740 "Income Taxes" ("ASC 740").

 The Company recognizes deferred
tax assets and liabilities for the expected future tax consequences of items that have been included or excluded in the financial statements
or tax returns. Deferred tax assets and liabilities are determined on the basis of the difference between the tax basis of assets and
liabilities and their respective financial reporting amounts ("temporary differences") at enacted tax rates in effect for
the years in which the temporary differences are expected to reverse.

 The Company utilizes a recognition
threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken
in a tax return. The Company's policy is to classify assessments, if any, for tax related interest as interest expense and penalties
as general and administrative expenses in the consolidated statements of operations and comprehensive loss.

 F- 13

 Recently Issued Accounting Pronouncements

 In June 2016, the FASB issued
ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.
The standard's main goal is to improve financial reporting by requiring earlier recognition of credit losses on financing receivables
and other financial assets in scope. The new guidance represents significant changes to accounting for credit losses, including i) full
lifetime expected credit losses will be recognized upon initial recognition of an asset in scope; ii) the current incurred loss impairment
model that recognizes losses when a probable threshold is met will be replaced with the expected credit loss impairment method without
recognition threshold; and iii) the expected credit losses estimate will be based upon historical information, current conditions, and
reasonable and supportable forecasts. ASU 2016-13 is effective for SEC filers (excluding those that are eligible to be a smaller reporting
company) for periods beginning after December 15, 2019 and for all other entities, for periods beginning after December 15, 2022. The
Company has adopted this standard effective January 1, 2023, and its adoption did not have a material impact on the Company's consolidated
financial statements and related disclosures.

 On
November 27, 2023, the FASB issued Accounting Standards Update ("ASU") 2023-07, Segment Reporting (Topic 280).
The amendments were designed to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant
segment expenses. In addition, the amendments enhance interim disclosure requirements, clarify circumstances in which an entity can disclose
multiple segment measures of profit or loss, provide new segment disclosure requirements for entities with a single reportable segment,
and contain other disclosure requirements. The purpose of the amendments is to enable investors to better understand an entity's
overall performance and assess potential future cash flows. The ASU applies to all public entities that are required to report segment
information in accordance with ASC 280. As the Company is not required to report segment information, this pronouncement does not have
a material effect on the Company's consolidated financial statements and related disclosures.

 On
December 14, 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The
ASU focuses on income tax disclosures around effective tax rates and cash income taxes paid. ASU 2023-09 largely follows the proposed
ASU issued earlier in 2023 with several important modifications and clarifications discussed below. ASU 2023-09 is effective for public
business entities for annual periods beginning after December 15, 2024 (generally, calendar year 2025) and effective for all other business
entities one year later. Entities should adopt this guidance on a prospective basis, though retrospective application is permitted. The
Company is currently assessing the implications of this ASU.

 Management does not believe that any other recently issued, but not effective, accounting
pronouncements, if currently adopted, would have a material effect on the Company's consolidated financial statements.

 NOTE 4 - PREPAID EXPENSES AND OTHER CURRENT
ASSETS

 Prepaid expenses and other
current assets consist of the following as of December 31, 2023 and 2022:

 2023

 2022

 Insurance

 $
 934,990

 $
 1,027,292

 Research and development expense tax credit receivable

 440,161

 546,563

 Professional fees

 279,039

 310,017

 Value-added tax receivable

 9,917

 48,774

 Taxes

 -

 25,634

 $
 1,664,107

 $
 1,958,280

 F- 14

 NOTE 5 - INTANGIBLE ASSETS AND IMPAIRMENT OF
LONG-LIVED ASSETS

 Intangible assets consist
of the following as of December 31, 2023 and 2022:

 Remaining
 Amortization
 Period

 As of December 31, 2023

 As of December 31, 2022

 in Years at
 2023

 Gross
 Asset
 Value

 Amortization

 Net
 Carrying
 Value

 Gross
 Asset
 Value

 Amortization

 Net
 Carrying
 Value

 Licensed patents

 11.4

 $
 599,686

 $
 ( 174,552
)

 $
 425,134

 $
 596,259

 $
 ( 142,654
)

 $
 453,605

 Technology license

 15.6

 1,562,744

 ( 368,308
)

 1,194,436

 1,485,159

 ( 279,906
)

 1,205,253

 $
 2,162,430

 $
 ( 542,860
)

 $
 1,619,570

 $
 2,081,418

 $
 ( 422,560
)

 $
 1,658,858

 Changes in the gross asset
value of licensed patents and technology licenses from the dates acquired are the result of changes in the foreign currency exchange rate.

 The Company recorded amortization
expense of $ 105,675 and $ 109,004 during the years ended December 31, 2023 and 2022, respectively, related to intangible assets, which
is included in general and administrative expense on the accompanying consolidated statements of operations and comprehensive loss.

 Future amortization related
to intangible assets is as follows:

 For the Years Ending December 31,

 2024

 $

 2025

 2026

 2027

 2028

 Thereafter

 1,050,606

 $
 1,619,571

 Goodwill Impairment

 The Company's publicly
traded stock closed at $ 1,482.00 per share as of December 31, 2021; during 2022, the market value of the Company's single reporting
unit significantly declined. As of March 31, 2022, June 30, 2022, September 30, 2022 and December 31, 2022, the market value of the Company's
publicly traded stock fell to $ 984.20, $ 322.24, $ 252.70 and $ 64.41, per share, respectively, and as such, the Company elected to conduct
a quantitative analysis of goodwill to assess for impairment as of September 30, 2022 and December 31, 2022. The Company determined the
fair market value of its single reporting unit and compared that value with the carrying amount of the reporting unit and determined that
goodwill was impaired as of both measurement dates. As of September 30, 2022 and December 31, 2022, the carrying value exceeded the fair
market value by $ 18,872,850 and $ 14,674,428, respectively. To recognize the impairment of goodwill, the Company recorded losses for these
amounts at the end of the third and fourth quarters, which appear as a loss on goodwill impairment of $ 33,547,278 on the income statement
for the year ended December 31, 2022.

 As of December 31, 2023 and
2022, the balance for goodwill is $ 0 for both periods.

 F- 15

 The following is a summary
of goodwill activity for the year ended December 31, 2022 for the Company's single reporting unit, which includes the recorded losses
on goodwill impairment described above.

 CBR
 Pharma
 Goodwill

 180 LP
 Goodwill

 Consolidated
 Goodwill

 Balance, January 1, 2022

 $
 23,749,631

 $
 13,238,255

 $
 36,987,886

 Currency translation

 ( 3,440,608
)

 -

 ( 3,440,608
)

 Impairment of goodwill

 ( 20,309,023
)

 ( 13,328,255
)

 ( 33,547,278
)

 Balance, December 31, 2022

 $
 -

 $
 -

 $
 -

 IP R&D Assets Impairment

 As of December 31, 2022, the
carrying amount of the IP R&D assets on the balance sheet was $ 12,405,084 (which consists of carrying amounts of $ 1,462,084 and $ 10,943,000
related to the Company's CBR Pharma subsidiary and its 180 LP subsidiary, respectively). Per the valuation obtained from a third
party as of year-end, the fair market value of the Company's IP R&D assets was determined to be $ 9,063,000 (which consists of
fair values of $ 0 and $ 9,063,000 related to the Company's CBR Pharma subsidiary and 180 LP subsidiary, respectively). As of this
measurement date, the carrying values of the CBR Pharma and 180 LP subsidiaries' assets exceeded their fair market values by $ 1,462,084
and $ 1,880,000, respectively. As such, management determined that the consolidated IP R&D assets were impaired by $ 3,342,084 and,
in order to recognize the impairment, the Company recorded a loss for this amount during the fourth quarter of 2022, which appears as
a loss on impairment to IP R&D assets on the income statement. This reduced the IP R&D asset balances of its CBR Pharma subsidiary
and its 180 LP subsidiary to zero and $9,063,000, respectively, as of December 31, 2022.

 F- 16

 During 2023, the Company assessed
the most recent delays in its commercialization timeline, general economic conditions, industry and market considerations, the Company's
financial performance and all relevant legal, regulatory, and political factors that might indicate the possibility of impairment and
concluded that, when these factors were collectively evaluated, it was more likely than not that the asset is impaired. The Company recorded
a loss in the amount of $ 9,063,000, which appeared as a loss on impairment to IP R&D assets on the income statement. As of December
31, 2023, the carrying amount of the IP R&D assets on the balance sheet is $ 0.

 Because of the write-off of
the IP R&D assets on the balance sheet and the loss on impairment to IP R&D assets on the income statement, the Company recorded
a decrease in its deferred tax liability relating to the impairment of the IP R&D assets of $ 2.3 million as income tax benefit relating
to impairment of the IP R&D assets in the same amount on the income statement for the period ended December 31, 2023.

 The following is a summary
of IP R&D activity for the years ended December 31, 2023 and 2022 for the Company, which includes the recorded losses for the IP R&D
assets described above.

 CBR
 Pharma IP
 R&D Assets

 180 LP IP
 R&D
 Assets

 Consolidated
 IP R&D
 Assets

 Balance, January 1, 2022

 $
 1,632,780

 $
 10,943,000

 $
 12,575,780

 Currency translation

 ( 170,696
)

 -

 ( 170,696
)

 Impairment of IP R&D assets

 ( 1,462,084
)

 ( 1,880,000
)

 ( 3,342,084
)

 Balance, December 31, 2022

 -

 9,063,000

 9,063,000

 Impairment of IP R&D assets

 -

 ( 9,063,000
)

 ( 9,063,000
)

 Balance, December 31, 2023

 $
 -

 $
 -

 $
 -

 NOTE 6 - ACCRUED EXPENSES

 Accrued expenses consist of
the following as of December 31, 2023 and 2022:

 2023

 2022

 Consulting fees

 $
 645,081

 $
 531,829

 Professional fees

 184,846

 3,945

 Litigation accrual (1)

 49,999

 125,255

 Employee and director compensation (2)

 530,383

 1,558,024

 Research and development fees

 378,683

 22,023

 Interest

 70,923

 36,422

 Other

 9,899

 7,018

 $
 1,869,814

 $
 2,284,516

 (1)
 See Note 9 - Commitments and Contingencies, Potential Legal Matters.

 (2)
 See Note 13 – Subsequent Events for additional details for this current year balance.

 As of December 31, 2023 and
2022, accrued expenses - related parties were $0 and $ 188,159, respectively. See Note 9 – Commitments & Contingencies and Note
12 - Related Parties for details.

 F- 17

 NOTE 7 - DERIVATIVE LIABILITIES

 The following table sets forth
a summary of the changes in the fair value of Level 3 derivative liabilities (except the Public Special Purpose Acquisition Companies
("SPAC") warrants as defined below, which are Level 1 derivative liabilities) that are measured at fair value on a recurring
basis:

 For the Year Ended December 31, 2023

 Public

 Private

 Alpha

 SPAC

 SPAC

 PIPE

 AGP

 Capital

 Total

 Balance as of January 1, 2023

 $
 31,625

 $
 1,256

 $
 42,100

 $

 $
 -

 $
 75,381

 ( 31,567
)

 ( 1,256
)

 ( 42,100
)

 ( 400
)

 -

 ( 75,323
)

 Balance as of December 31, 2023

 $

 $
 -

 $
 -

 $
 -

 $
 -

 $

 For the Year Ended December 31, 2022

 Public

 Private

 Alpha

 SPAC

 SPAC

 PIPE

 AGP

 Capital

 Total

 Balance as of January 1, 2022

 $
 8,048,850

 $
 467,325

 $
 6,516,300

 $
 144,331

 $
 43,561

 $
 15,220,367

 ( 8,017,225
)

 ( 466,069
)

 ( 6,474,200
)

 ( 143,931
)

 ( 43,561
)

 ( 15,144,986
)

 Balance as of December 31, 2022

 $
 31,625

 $
 1,256

 $
 42,100

 $

 $
 -

 $
 75,381

 F- 18

 The fair value of the SPAC
derivative liabilities as of December 31, 2023 and 2022 were estimated using the Black Scholes option pricing model, with the following
assumptions used:

 2023

 Risk-free interest rate

 3.71 % – 5.50
 %

 Expected term in years

 0.59 – 2.90

 100.0 %– 110.0
 %

 %

 SPAC Warrants

 Public SPAC Warrants

 Participants in KBL's
initial public offering received an aggregate of 11,500,000 Public SPAC Warrants ("Public SPAC Warrants"). Each Public SPAC
Warrant entitles the holder to purchase one-seven hundred sixtieth of one share of the Company's common stock at an exercise price
of $ 5.75 per 1/760 th of one share, or $ 4,370.00 per whole share, subject to adjustment. No fractional shares will be issued
upon exercise of the Public Warrants. The Public Warrants are currently exercisable and will expire on November 6, 2025, or earlier upon
redemption or liquidation. The Company may redeem the Public Warrants, in whole and not in part, at a price of $ 0.01 per Public Warrant
upon 30 days' notice ("30-day redemption period"), only in the event that the last sale price of the common stock equals
or exceeds $ 6,840.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date
on which notice of redemption is given, provided there is an effective registration statement with respect to the shares of common stock
underlying such Public Warrants and a current prospectus relating to those shares of common stock is available throughout the 30-day redemption
period. If the Company calls the Public Warrants for redemption as described above, the Company's management will have the option
to require all holders that wish to exercise Public Warrants to do so on a "cashless basis." Management has determined that
the Public Warrants contain a tender offer provision which could result in the Public Warrants settling for the tender offer consideration
(including potentially cash) in a transaction that didn't result in a change-in-control. This feature results in the Public Warrants
being precluded from equity classification. Accordingly, the Public Warrants are classified as liabilities measured at fair value, with
changes in fair value each period reported in earnings. The fair value of the Public SPAC Warrants on the date of the issuance was $ 1,978,000.
At December 31, 2023 and 2022 the Public SPAC Warrants were revalued at $ 58 and $ 31,625, respectively, which resulted in decreases of
$ 31,567 and $ 8,017,225 in the fair value of the derivative liabilities during the years ended December 31, 2023 and 2022, respectively.
The decreases in fair value of these derivative liabilities were recorded in the accompanying consolidated statement of operations.

 F- 19

 Private SPAC Warrants

 Participants in KBL's
initial private placement received an aggregate of 502,500 Private SPAC Warrants ("Private SPAC Warrants"). Each Private Warrant
entitles the holder to purchase one-seven hundred sixtieth of one share of the Company's common stock at an exercise price of $ 5.75
per 1/760 th of one share, or $ 4,370.00 per whole share, subject to adjustment. No fractional shares will be issued upon exercise
of the warrants. The Private Warrants are currently exercisable and will expire five years after the completion of the Business Combination
or earlier upon redemption or liquidation. The Private Warrants are non-redeemable so long as they are held by original holders or their
permitted transferees. If the Private Warrants are held by other parties, the Company may redeem the Private Warrants, in whole and not
in part, at a price of $ 0.01 per Warrant upon 30 days' notice ("30-day redemption period"), only in the event that the
last sale price of the common stock equals or exceeds $ 6,840.00 per share for any 20 trading days within a 30-trading day period ending
on the third trading day prior to the date on which notice of redemption is given, provided there is an effective registration statement
with respect to the shares of common stock underlying such Warrants and a current prospectus relating to those shares of common stock
is available throughout the 30-day redemption period. If the Company calls the Private Warrants for redemption as described above, the
Company's management will have the option to require all holders that wish to exercise Private Warrants to do so on a "cashless
basis." Management has determined that the Private Warrants contain a tender offer provision which could result in the Private Warrants
settling for the tender offer consideration (including potentially cash) in a transaction that didn't result in a change-in-control.
This feature (amongst others) results in the Private Warrants being precluded from equity classification. Accordingly, the Private Warrants
are classified as liabilities measured at fair value, with changes in fair value each period reported in earnings. The fair value of the
Private SPAC Warrants on the date of the issuance was $ 587,925. At December 31, 2023 and 2022, the Private SPAC Warrants were revalued
at $0 and $ 1,256, respectively, which resulted in decreases of $ 1,256 and $ 466,069 in the fair value of the derivative liabilities during
the years ended December 31, 2023 and 2022, respectively. The decreases in fair value of these derivative liabilities were recorded in
the accompanying consolidated statement of operations.

 PIPE Warrants

 On February 23, 2021, the
Company issued five-year warrants (the "PIPE Warrants") to purchase 6,748 shares of common stock at an exercise price of
$ 1,900.00 per share in connection with the private offering (see Note 10 – Stockholders' (Deficit) Equity, Common
Stock). The PIPE Warrants did not meet the requirements for equity classification due to the existence of a tender offer provision
that could potentially result in cash settlement of the PIPE Warrants that didn't meet the limited exception in the case of a
change-in-control. Accordingly, the PIPE Warrants are liability-classified and the Company recorded the $ 7,294,836 fair value of the
PIPE Warrants, which was determined using the Black-Scholes option pricing model, as derivative liabilities. The PIPE Warrants were
revalued on December 31, 2023 and 2022 at $0 and $ 42,100, respectively, which resulted in decreases in the fair value of the
derivative liabilities of $ 42,100 and $ 6,474,200 during the years ended December 31, 2023 and 2022, respectively.

 The following assumptions
were used to value the PIPE Warrants at issuance:

 February 23,
 2021

 Risk-free interest rate

 0.59
 %

 Expected term in years

 5.00

 %

 %

 Other Warrants

 AGP Warrant

 In connection with the closing
of the Business Combination on November 6, 2020, the Company became obligated to assume five-year warrants for the purchase of 168 shares
of the Company's common stock at an exercise price of $ 2,006.40 per share (the "AGP Warrant Liability") that had originally
been issued by KBL to an investment banking firm in connection with a prior private placement.

 F- 20

 On March 12, 2021, the Company
issued a warrant to AGP (the "AGP Warrant") to purchase up to an aggregate of 168 shares of the Company's common stock
at a purchase price of $ 2,006.40 per share, subject to adjustment, in full satisfaction of the existing AGP Warrant Liability. The exercise
of the AGP Warrant is limited at any given time to prevent AGP from exceeding beneficial ownership of 4.99 % of the then total number of
issued and outstanding shares of the Company's common stock upon such exercise. The warrant is exercisable at any time between May
2, 2021 and May 2, 2025. The newly issued AGP Warrant did not meet the requirements for equity classification due to the existence of
a tender offer provision that could potentially result in cash settlement of the AGP Warrant that did not meet the limited exception in
the case of a change-in-control. Accordingly, the AGP Warrant will continue to be liability-classified. The AGP Warrant was revalued on
December 31, 2023 and 2022 at $0 and $ 400, respectively, which resulted in decreases in the fair value of the derivative liabilities of
$ 400 and $ 143,931 during the years ended December 31, 2023 and 2022, respectively.

 The following assumptions
were used to value the AGP Warrant at issuance:

 March 12,
 2021

 Risk-free interest rate

 0.68
 %

 Expected term in years

 3.84

 %

 %

 Alpha Capital Anstalt ("Alpha")
Warrant

 In connection with the Alpha
Settlement Agreement that was agreed to on July 29, 2021 (signed on July 31, 2021), the Company issued a three-year warrant for the purchase
of 66 shares of the Company's common stock at an exercise price of $ 2,686.60 per share (the "Alpha Warrant Liability"
and the "Alpha Warrant"). The exercise of shares of the Alpha Warrant is limited at any given time to prevent Alpha from exceeding
a beneficial ownership of 4.99 % of the then total number of issued and outstanding shares of the Company's common stock upon such
exercise. The warrant is exercisable until August 2, 2024. The newly issued Alpha Warrant did not meet the requirements for equity classification
due to the existence of a tender offer provision that could potentially result in cash settlement of the Alpha Warrant that did not meet
the limited exception in the case of a change-in-control. Accordingly, the Alpha Warrant is liability-classified and the Company recorded
the $ 95,677 fair value of the Alpha Warrant, which was determined using the Black-Scholes option pricing model, as a derivative liability.
The Alpha Warrant was revalued on December 31, 2023 and 2022 at $0 for both periods, which resulted in decreases in the fair value of
the derivative liabilities of $0 and $ 43,561 during the years ended December 31, 2023 and 2022, respectively.

 The following assumptions
were used to value the Alpha Warrant at issuance:

 July 29,
 2021

 Risk-free interest rate

 0.37
 %

 Expected term in years

 3.00

 %

 %

 F- 21

 Warrant Activity

 A summary of the warrant
activity (including certain warrants granted in August 2021, July 2022, December 2022, April 2023, August 2023 and November 2023 as
part of private offerings, all of which are equity-classified; see Note 10 - Stockholders' (Deficit) Equity) during the years
ended December 31, 2023 and 2022 is presented below:

 Weighted Average

 Exercise Price

 Weighted Average

 Remaining Life in

 Years

 Intrinsic

 Value

 Outstanding, January 1, 2022

 29,355

 $
 3,442.24

 4.1

 $
 -

 Issued

 237,312

 65.36

 5.4

 Exercised

 ( 85,837
)

 0.0019

 -

 Outstanding, December 31, 2022

 180,832

 $
 644.80

 5.1

 125,211

 Issued

 1,329,275

 1.95

 4.1

 1,706,815

 Exercised

 ( 269,429
)

 0.0019

 -

 -

 Outstanding, December 31, 2023

 1,240,678

 $
 83.98

 5.1

 $
 1,832,026

 Exercisable, December 31, 2023

 29,355

 $
 3,444.24

 2.1

 -

 A summary of outstanding and
exercisable warrants as of December 31, 2023 is presented below:

 Warrants Outstanding

 Warrants Exercisable

 Exercise

 Remaining

 Price

 Life in Years

 $
 1,900.00

 6,748

 2.2

 6,748

 $
 2,006.40

 1.3

 $
 2,686.60

 0.6

 $
 2,850.00

 6,579

 2.6

 6,579

 $
 4,370.00

 15,793

 1.9

 15,794

 $
 3.23

 954,119
 (1)

 -

 -

 $
 0.0019

 257,205
 (2)

 -

 -

 1,240,678

 2.1

 29,355

 (1)
 Note that this number of shares is comprised of the July 2022,
December 2022, April 2023, August 2023 and the Amendment to the August 2023 common warrants; as of December 31, 2023, none of these warrants
were exercisable, as the meeting to obtain shareholder approval for these warrants did not occur until February 16, 2024. As such, they
have not been included in the warrants exercisable calculations.

 (2)
 Note that this number of shares is comprised of the Amendment
to the August 2023 pre-funded warrants; as of December 31, 2023, none of these warrants were exercisable, as the meeting to obtain shareholder
approval for these warrants did not occur until February 16, 2024. As such, they have not been included in the warrants exercisable calculations.

 F- 22

 NOTE 8 - LOANS PAYABLE

 The following tables summarize
the activity of loans payable during the years ended December 31, 2023 and 2022:

 Balance at
 January 1,
 2023

 Adjustments

 Repaid in
 Cash

 New Issuances

 Effect of
 Foreign
 Exchange
 Rates

 Balance at
 2023

 Bounce Back Loan Scheme

 $
 43,129

 $
 -

 $
 ( 12,326
)

 $
 -

 $
 2,015

 $
 32,818

 First Assurance – 2022

 -

 ( 1,060,890
)

 -

 -

 -

 First Assurance – 2023

 -

 -

 ( 184,172
)

 969,322

 -

 785,150

 Other loans payable

 235,686

 -

 -

 236,092

 Total loans payable

 1,339,705

 $
 -

 $
 ( 1,257,388
)

 $
 969,322

 $
 2,421

 1,054,060

 Less: loans payable – current portion

 1,308,516

 1,034,124

 Loans payable – non-current portion

 $
 31,189

 $
 19,936

 Balance at
 January 1,
 2022

 Adjustments

 Repaid in
 Cash

 New Issuances

 Effect of
 Foreign
 Exchange
 Rates

 Balance at
 2022

 Paycheck Protection Program

 $
 41,312

 $
 -

 $
 ( 41,312
)

 $
 -

 $
 -

 $
 -

 Bounce Back Loan Scheme

 61,169

 -

 ( 11,646
)

 -

 ( 6,394
)

 43,129

 First Assurance – 2021

 1,618,443

 (14,042

) (1)

 ( 1,604,401
)

 -

 -

 -

 First Assurance – 2022

 -

 -

 -

 -

 Other loans payable

 155,320

 80,366
 (2)

 -

 -

 235,686

 Total loans payable

 1,876,244

 $
 66,324

 $
 ( 1,657,359
)

 $

 $
 ( 6,394
)

 1,339,705

 Less: loans payable – current portion

 1,828,079

 1,308,516

 Loans payable – non-current portion

 $
 48,165

 $
 31,189

 (1)
 Note that this amount was related to finance charges and was
reclassified.

 (2)
 Note that this amount was reclassified from related party payables.

 F- 23

 Loans Payable, Current Portion

 Simple
 Interest Rate

 2023

 2022

 Loan payable issued September 18, 2019

 %

 $

 $

 Loan payable issued September 18, 2019

 %

 Loan payable issued October 8, 2019

 %

 4,000

 4,000

 Loan payable issued October 29, 2019

 %

 69,250

 69,250

 Loan payable issued December 31, 2019

 %

 5,000

 5,000

 Loan payable issued February 5, 2020

 %

 3,500

 3,500

 Loan payable issued February 5, 2020

 %

 3,500

 3,500

 Loan payable issued March 31, 2020

 %

 4,537

 4,537

 Loan payable issued March 31, 2020

 %

 4,537

 4,537

 Loan payable issued June 8, 2020

 %

 5,000

 5,000

 Loan payable issued June 17, 2020

 %

 Loan payable issued July 15, 2020 *

 %

 4,695

 4,695

 Loan payable issued July 15, 2020

 %

 5,503

 5,503

 Loan payable issued October 8, 2020 *

 %

 8,204

 7,798

 Loan payable issued October 13, 2020

 %

 13,337

 13,337

 Loan payable issued October 14, 2020

 %

 4,544

 4,544

 Current portion of Bounce Back Loans (1) (2)

 %

 12,882

 11,940

 First Assurance Funding payable issued December 2023 and 2022 (2)

 %

 785,150

 $
 1,034,124

 $
 1,308,516

 *
 These loans are denominated in currencies other than USD.

 (1)
 See Loans Payable, Non-Current Portion for a description of
the PPP Loans and the Bounce Back Loans.

 (2)
 Note that these loans are not currently in default.

 F- 24

 Loans Payable, Non-Current Portion

 The non-current portion of
the Company's loans payable as of December 31, 2023 and 2022 are as follows:

 Simple Interest Rate

 2023

 2022

 Maturity
 Date

 BBLS loan payable issued June 10, 2020

 2.5
 %

 32,818

 43,129

 6/10/2026

 Subtotal

 32,818

 43,129

 Less: Current portions of BBLS loans, respectively (see above)

 ( 12,882
)

 ( 11,940
)

 Non-current portion

 $
 19,936

 $
 31,189

 On June 10, 2020, the Company received GBP 50,000
(USD $ 64,353) of cash proceeds pursuant to the Bounce Back Loan Scheme ("BBLS"), which provides financial support to businesses
across the UK that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak. The BBLS is unsecured
and bears interest at 2.5 % per annum. The maximum loan amount is GBP 50,000 and the length of the loan is six years, with payments
beginning 12 months after the date of disbursement. Early repayment is allowed, without early repayment fees. As of December 31, 2023
and 2022, the Company recorded accrued interest of GBP 248 (USD $ 316) and GBP 477 (USD $ 732), respectively, related to the
BBLS loan. During the years ended December 31, 2023 and 2022, the Company recorded interest expense of GBP 549 (USD $ 683) and GBP
 721 (USD $ 901), respectively, related to the BBLS loan.

 On December 10, 2022, the
Company entered into a financing arrangement for a Directors and Officers Insurance Policy (the "D&O Insurance") with
First Insurance Funding to finance $ 872,034 of a total D&O Insurance amount of $ 1,060,891 inclusive of premiums, taxes, and fees.
During 2023, the Company paid in full the balance of the 2022 D&O Insurance. On December 10, 2023, the Company entered into a financing
arrangement for another policy with First Insurance Funding to finance $ 903,098 of a total D&O Insurance amount of $ 969,322 inclusive
of premiums, taxes, and fees. As of December 31, 2023, a total of $872,390 remains financed in loans payable, due in monthly installments
of $ 90,310.

 Interest Expense (Income) on Loans Payable

 For the years ended December
31, 2023 and 2022, the Company recognized interest expense — related parties associated with outstanding loans payable of $ 18,436
and $ 14,156, respectively.

 For the years ended December
31, 2023 and 2022, the Company recognized interest income — related parties associated with outstanding loans payable of $ 0 and
($ 1,490), respectively.

 As of December 31, 2023, the
Company had accrued interest and accrued interest — related parties associated with outstanding loans payable of $ 70,923 and $ 0,
respectively. See Note 12 — Related Parties for additional details.

 As of December 31, 2022, the
Company had accrued interest and accrued interest — related parties associated with outstanding loans payable of $ 37,960 and $ 16,770,
respectively. See Note 12 — Related Parties for additional details.

 F- 25

 NOTE 9 - COMMITMENTS AND CONTINGENCIES

 Litigation and Other Loss Contingencies

 The Company records liabilities
for loss contingencies arising from claims, assessments, litigation, fines, penalties, and other sources when it is probable that a liability
has been incurred and the amount of the loss can be reasonably estimated. The Company has no liabilities recorded for loss contingencies
as of December 31, 2023.

 Potential Legal Matters

 Action Against Former Executive of KBL

 On September 1, 2021, the
Company initiated legal action in the Chancery Court of Delaware against Dr. Marlene Krauss, the Company's former Chief Executive
Officer and director ("Dr. Krauss") and two of her affiliated companies, KBL IV Sponsor, LLC and KBL Healthcare Management,
Inc. (collectively, the "KBL Affiliates") for, among other things, engaging in unauthorized monetary transfers of the
Company's assets, non-disclosure of financial liabilities within the Company's Consolidated Financial Statements, issuing
shares of stock without proper authorization; and improperly allowing stockholder redemptions to take place. The Company's complaint
alleges causes of action against Dr. Krauss and/or the KBL Affiliates for breach of fiduciary duties, ultra vires acts, unjust enrichment,
negligence and declaratory relief, and seeks compensatory damages in excess of $ 11,286,570, together with interest, attorneys' fees
and costs. There can be no assurance that the Company will be successful in its legal actions.

 On October 5, 2021, Dr. Krauss
and the KBL Affiliates filed an Answer, Counterclaims and Third-Party Complaint (the "Krauss Counterclaims") against the Company
and twelve individuals who are, or were, directors and/or officers of the Company, i.e., Marc Feldmann, Lawrence Steinman, James N. Woody, Teresa DeLuca,
Frank Knuettel II, Pamela Marrone, Lawrence Gold, Donald A. McGovern, Jr., Russell T. Ray, Richard W. Barker, Shoshana Shendelman and
Ozan Pamir (collectively, the "Third-Party Defendants"). On October 27, 2021, the Company and Ozan Pamir filed
an Answer to the Krauss Counterclaims, and all of the other Third-Party Defendants filed a Motion to Dismiss as to the Third-Party Complaint.

 On January 28, 2022, in lieu
of filing an opposition to the Motion to Dismiss, Dr. Krauss and the KBL Affiliates filed a Motion for leave to file amended counterclaims
and third-party complaint, and to dismiss six of the current and former directors previously named, i.e., to dismiss Teresa DeLuca,
Frank Knuettel II, Pamela Marrone, Russell T. Ray, Richard W. Barker and Shoshana Shendelman. The Motion was granted by stipulation
and, on February 24, 2022, Dr. Krauss filed an amended Answer, Counterclaims and Third-Party Complaint (the "Amended Counterclaims").
In essence, the Amended Counterclaims allege (a) that the Company and the remaining Third-Party Defendants breached fiduciary duties to
Dr. Krauss by making alleged misstatements against Dr. Krauss in SEC filings and failing to register her shares in the Company so that
they could be traded, and (b) the Company breached contracts between the Company and Dr. Krauss for registration of such shares, and also
failed to pay to Dr. Krauss the amounts alleged to be owing under a promissory note in the principal amount of $ 371,178, plus an additional
$ 300,000 under Dr. Krauss's resignation agreement. The Amended Counterclaims seek unspecified amounts of monetary damages,
declaratory relief, equitable and injunctive relief, and attorney's fees and costs.

 On March 16, 2022, Donald
A. McGovern, Jr. and Lawrence Gold filed a Motion to Dismiss the Amended Counterclaims against them, and the Company and the remaining
Third-Party Defendants filed an Answer to the Amended Counterclaims denying the same. On April 19, 2022, Dr. Krauss stipulated to
dismiss all of her counterclaims and allegations against both Donald A. McGovern, Jr. and Lawrence Gold, thereby mooting their Motion
to Dismiss the Amended Counterclaims against them. The Company and the Third-Party Defendants intend to continue to vigorously defend
against all of the Amended Counterclaims, however, there can be no assurance that they will be successful in the legal defense of such
Amended Counterclaims. In April 2022, Donald A. McGovern, Jr. and Lawrence Gold were dismissed from the lawsuit as parties. Discovery
has not yet commenced in the case. The Company and the Third-Party Defendants intend to continue to vigorously defend against all
the Amended Counterclaims, however, there can be no assurance that they will be successful in the legal defense of such Amended Counterclaims.

 F- 26

 Action Against the Company by Dr. Krauss

 On August 19, 2021, Dr. Krauss
initiated legal action in the Chancery Court of Delaware against the Company. The original Complaint sought expedited relief and
made the following two claims: (1) it alleged that the Company is obligated to advance expenses including, attorney's fees,
to Dr. Krauss for the costs of defending against the SEC and certain Subpoenas served by the SEC on Dr. Krauss; and (2) it alleged that
the Company is also required to reimburse Dr. Krauss for the costs of bringing this lawsuit against the Company. On or about
September 3, 2021, Dr. Krauss filed an Amended and Supplemental Complaint (the "Amended Complaint") in this action, which
added the further claims that Dr. Krauss is also allegedly entitled to advancement by the Company of her expenses, including attorney's
fees, for the costs of defending against the Third-Party Complaint in the Tyche Capital LLC action referenced below, and the costs of
defending against the Company's own Complaint against Dr. Krauss as described above. On or about September 23, 2021,
the Company filed its Answer to the Amended Complaint in which the Company denied each of Dr. Krauss' claims and further raised
numerous affirmative defenses with respect thereto.

 On November 15, 2021, Dr.
Krauss filed a Motion for Summary Adjudication as to certain of the issues in the case, which was opposed by the Company. A hearing
on such Motion was held on December 7, 2021, and, on March 7, 2022, the Court issued a decision in the matter denying the Motion
for Summary Adjudication in part and granting it in part. The Court then issued an Order implementing such a decision on March 29,
2022. The parties are now engaging in proceedings set forth in that implementing Order. The Court granted Dr. Krauss's request
for advancement of some of the legal fees which Dr. Krauss requested in her Motion, and the Company was required to pay a portion of those
fees while it objects to the remaining portion of disputed fees.

 On October 10, 2022, Dr. Krauss
filed an application to compel the Company to pay the full amount of fees requested by Dr. Krauss for May-July 2022, and to modify the
Court's Order. The Company filed its Opposition thereto. On January 18, 2023, Dr. Krauss filed a Second Application to compel the Company
to pay the full amount of fees requested by Dr. Krauss for August-October 2022, and to modify the Court's Order. The Company filed its
Opposition thereto. On May 3, 2023, the Court issued an Order granting both of Dr. Krauss's Applications for payment of the full amount
of requested attorney's fees totaling $ 714,557 for the months of May through October 2022, which were paid in May 2023. Notwithstanding
the Order, such ruling does not constitute any final adjudication as to whether Dr. Krauss will ultimately be entitled to permanently
retain such advancements, and Dr. Krauss has posted an undertaking with the Court affirmatively promising to repay all such amounts if
she is eventually found to be liable for the Company's and/or the SEC's claims against her. The Company is seeking payment for a substantial
portion of such amounts from its director and officers' insurance policy, of which no assurance can be provided that the directors and
officers insurance policy will cover such amounts.

 Action Against Tyche Capital LLC

 The Company commenced and
filed an action against defendant Tyche Capital LLC ("Tyche") in the Supreme Court of New York, in the County of New York,
on April 15, 2021. In its Complaint, the Company alleged claims against Tyche arising out of Tyche's breach of its written
contractual obligations to the Company as set forth in a "Guarantee and Commitment Agreement" dated July 25, 2019, and a "Term
Sheet for KBL Business Combination With CannBioRex" dated April 10, 2019 (collectively, the "Subject Guarantee").
The Company alleges in its Complaint that, notwithstanding demand having been made on Tyche to perform its obligations under the Subject
Guarantee, Tyche has failed and refused to do so, and is currently in debt to the Company for such failure in the amount of $ 6,776,686,
together with interest accruing thereon at the rate set forth in the Subject Guarantee.

 On or about May 17, 2021,
Tyche responded to the Company's Complaint by filing an Answer and Counterclaims against the Company alleging that it was the Company,
rather than Tyche, that had breached the Subject Guarantee. Tyche also filed a Third-Party Complaint against six third-party defendants,
including three members of the Company's management, Sir Marc Feldmann, Dr. James Woody, and Ozan Pamir (collectively, the "Individual
Company Defendants"), claiming that they allegedly breached fiduciary duties to Tyche with regards to the Subject Guarantee. In
that regard, on June 25, 2021, each of the Individual Company Defendants filed a Motion to Dismiss Tyche's Third-Party Complaint
against them.

 On November 23, 2021, the
Court granted the Company's request to issue an Order of attachment against all of Tyche's shares of the Company's stock
that had been held in escrow. In so doing, the Court found that the Company had demonstrated a likelihood of success on the merits
of the case based on the facts alleged in the Company's Complaint.

 F- 27

 On February 18, 2022, Tyche
filed an Amended Answer, Counterclaims and Third-Party Complaint. On March 22, 2022, the Company and each of the Individual Company
Defendants filed a Motion to Dismiss all of Tyche's claims. A hearing on such Motion to Dismiss was held on August 25,
2022, and the Court granted the Motion to Dismiss entirely as to each of the Individual Company Defendants, and also as to three of the
four Counterclaims brought against the Company, only leaving Tyche's declaratory relief claim. On September 9, 2022, Tyche filed
a Notice of Appeal as to the Court's decision, which has not yet been briefed or adjudicated. On August 26, 2022, Tyche filed a
Motion to vacate or modify the Company's existing attachment Order against Tyche's shares of the Company's stock held
in escrow. The Company has filed its Opposition thereto, and the Court summarily denied such Motion without hearing on January 3, 2023.
Tyche subsequently filed a Notice of Appeal as to that denial and filed its Opening Brief on January 30, 2023. The Company
filed its opposition brief on March 2, 2023, and the matter was taken under submission by the Appellate Court. On May 4, 2023, the Appellate
Court issued its decision unanimously affirming the ruling of the lower Court in the Company's favor.

 On January 30, 2023, the Company
filed a Notice of Motion for Summary Judgment and to Dismiss Affirmative Defenses against Tyche. Tyche filed opposition thereto, and hearings
on the Company's Motion were ultimately held on September 11 and 19, 2023. In its ruling, the Court granted the Company's Motion, but
referred the question as to the amount of the Company's damages against Tyche to a special referee. The Court and the parties are now
in the process of appointing the special referee so that a determination can be made as to the amount of the Company's damages against
Tyche. Tyche filed a Notice of Appeal as the Court's summary judgment ruling on October 12, 2023. No briefing for the appeal has yet occurred.
The Company intends to continue to vigorously pursue its claims against Tyche, and the Company and the Individual Company Defendants intend
to continue to vigorously defend against all of Tyche's claims should they be appealed; however, there can be no assurance that they will
be successful in such endeavors.

 Action Against Ronald Bauer & Samantha
Bauer

 The Company and two of its
wholly owned subsidiaries, Katexco Pharmaceuticals Corp. and CannBioRex Pharmaceuticals Corp. (collectively, the "Company Plaintiffs"),
initiated legal action against Ronald Bauer and Samantha Bauer, as well as two of their companies, Theseus Capital Ltd. and Astatine Capital
Ltd. (collectively, the "Bauer Defendants"), in the Supreme Court of British Columbia on February 25, 2022. The Company Plaintiffs
are seeking damages against the Bauer Defendants for misappropriated funds and stock shares, unauthorized stock sales, and improper travel
expenses, in the combined sum of at least $ 4,395,000 CAD [$ 3,317,408 USD] plus the additional sum of $ 2,721,036 USD (which relate to the
aforementioned damages).

 The Bauer Defendants filed
a Response to the Civil Claim Complaint of the Company on May 6, 2022, in which the Bauer Defendants denied the Company's claims
and set forth their own version of the facts in the matter. Discovery has not yet commenced in the case. There can be no assurance that
the Company Plaintiffs will be successful in this legal action.

 Declaratory Relief Action Against the Company
by AmTrust International

 On June 29, 2022, AmTrust
International Underwriters DAC ("AmTrust"), which was the premerger directors' and officers' insurance policy
underwriter for KBL, filed a declaratory relief action against the Company in the U.S. District Court for the Northern District
of California (the "Declaratory Relief Action") seeking declaration of AmTrust's obligations under the directors'
and officers' insurance policy. In the Declaratory Relief Action, AmTrust is claiming that as a result of the merger
the Company is no longer the insured under the subject insurance policy, notwithstanding the fact that the fees which the Company
seeks to recover from AmTrust relate to matters occurring prior to the merger.

 On September 20, 2022, the
Company filed its Answer and Counterclaims against AmTrust for bad faith breach of AmTrust's insurance coverage obligations to the
Company under the subject directors' and officers' insurance policy, and seeking damages of at least $ 2 million in compensatory
damages, together with applicable punitive damages. In addition, the Company brought a Third-Party Complaint against its excess insurance
carrier, Freedom Specialty Insurance Company ("Freedom") seeking declaratory relief that Freedom will also be required to
honor its policy coverage as soon as the amount of AmTrust's insurance coverage obligations to the Company have been exhausted.
On October 25, 2022, AmTrust filed its Answer to the Company's Counterclaims and, on October 27, 2022, Freedom filed its Answer
to the Third-Party Complaint.

 F- 28

 On November 22, 2022,
the Company filed a Motion for Summary Adjudication against both AmTrust and Freedom. The Motion was fully briefed and a hearing
was held on March 9, 2023. The standard to prevail on a Motion for Summary Adjudication in the Court is high to prevail and requires
a judge to find that there are no disputed issues of fact so that they can rule on the issues as a matter of law. In this instance the
judge found three major issues could be decided as a matter of law in the Company's favor and that one issue, the Change in Control exclusion,
requires further discovery.

 On April 21, 2023, the Court
issued an Order Granting in Part and Denying in Part the Company's Motion for Partial Summary Judgment.

 Specifically, the Court granted
summary adjudication in favor of the Company on the following issues: (a) that the Company is, in fact, an insured under both the AmTrust
and Freedom insurance policies; (b) that certain SEC subpoena related expenses for defendants Dr. Marlene Krauss, the Company's former
Chief Executive Officer and Director, and George Hornig, the former Chairman of the Board, are within the basic scope of coverage under
both the AmTrust and Freedom insurance policies; and (c) that the Insured vs. Insured exclusion relied upon by AmTrust and Freedom is
not applicable to bar any such coverage.

 The Court also found that
there were issues of disputed facts as to the Change in Control exclusion contained within the policies, which therefore precluded the
Court from granting the remainder of the Company's requests for summary adjudication as a matter of law. Accordingly, the Court, at this
time, denied the Company's further requests for summary adjudication and deemed that for the time being, the Change in Control issue is
to be determined at the time of trial, in order to find that the policies (i) provide coverage for the fees which the Company has advanced
and will advance to Dr. Marlene Krauss and George Hornig; (ii) that AmTrust has breached the policy; (iii) that AmTrust must pay such
expenses of the Company; and that, once the AmTrust policy has been exhausted, (iv) Freedom will be obligated to pay such expenses of
the Company pursuant to its policy.

 On August 4, 2023, the Court
granted the Company's request to file a second motion for partial summary judgment in this case, this one being on the issue of whether
AmTrust should be required to advance to the Company the defense costs being incurred by Dr. Marlene Krauss and George Hornig during the
pendency of the case. The Motion for Partial Summary Judgment was fully briefed by the parties, and a hearing for such Motion was held
on January 11, 2024. After the matter was taken under submission, on February 12, 2024, the Court granted the Company's Motion for Partial
Summary Judgment against both AmTrust and Freedom, and ordered as follows: (a) AmTrust is obligated under its insurance policy with the
Company to advance to the Company all defense costs in excess of the deductible that the Company has advanced, or will advance, to Dr.
Krauss and Mr. Hornig in connection with certain SEC Subpoenas, and (b) upon exhaustion of the AmTrust insurance policy, Freedom is obligated
to do the same pursuant to its excess liability insurance policy with the Company. This Order applies throughout the interim of the case,
but does not constitute a final judgment, and both the Company and the two insurers retain their rights to contest all applicable issues
at trial, which is scheduled for May 12, 2025. A final judgment following trial could potentially confirm these obligations of the insurers
or, alternatively, reverse and require the Company to repay all or portions of such advance payments. There is no assurance at this time
as to what the final judgment may entail.

 The parties have commenced
written discovery proceedings against each other and anticipate that depositions will also occur. The Company intends to continue to vigorously
pursue this matter in order to establish the Company's entitlement to full and final payment by both AmTrust and Freedom of the subject
advancement expenses of the Company. While the Company continues to believe it has a strong case against both AmTrust and Freedom, there
can be no assurance that the Company will prevail in this action.

 Stanford License Agreement

 On May 8, 2018, Katexco entered
into a six-month option agreement (the "Stanford Option") with Stanford University ("Stanford") under which Stanford
granted the Company a six-month option to acquire an exclusive license for patents (the "Licensed Patents") which are related
to biological substances used to treat auto- immune diseases. In consideration for the Stanford Option, the Company paid Stanford $ 10,000
(the "Option Payment"), which was creditable against the first anniversary license maintenance fee payment.

 On July 25, 2018, Katexco
exercised their six-month option and entered into an exclusive license agreement (the "Stanford License Agreement") with Stanford.
Pursuant to the Stanford License Agreement, beginning upon the first anniversary of the effective date, and each anniversary thereafter,
the Company will pay Stanford, in advance, a yearly license maintenance fee of $ 20,000, on each of the first and second anniversaries
and $ 40,000 on each subsequent anniversary, which will be expensed on a straight-line basis annually.

 F- 29

 Furthermore, the Company will
be obligated to make the following milestone payments:

 i)
 $ 100,000 upon initiation of Phase II trial;

 ii)
 $ 500,000 upon the first U.S. Food and Drug Administration approval
of a product (the "Licensed Product") resulting from the Licensed Patents; and

 iii)
 $ 250,000 upon each new Licensed Product thereafter.

 The Stanford License Agreement
is cancellable by the Company with 30 days notice. Royalties, calculated at 2.5 % of 95 % of net product sales, will be payable to Stanford.
Also, the Company will reimburse Stanford for patent expenses as per the agreement. The Company paid Stanford $ 20,000 for the annual license
maintenance fee that was recorded to prepaid expenses and is being expensed on a straight-line basis over 12 months, which had a zero
balance as of December 31, 2021. During the years ended December 31, 2023 and 2022, the Company recorded patent and license fees of $ 55,526
and $ 69,278, respectively, related to the Stanford License Agreement, which is included in general and administrative expenses on the
accompanying statements of operations and comprehensive loss.

 Oxford University Agreements

 On September 18, 2020, CBR
Pharma entered into a 3 year research and development agreement (the "3 Year Oxford Agreement") with Oxford to research and
investigate the mechanisms underlying fibrosis in exchange for aggregate consideration of $ 1,085,738 ( 795,468), of which $ 109,192
( 80,000) is to be paid 30 days after the project start date and the remaining amount is to be paid in four equal installments of
$ 244,136 ( 178,867) on the six month anniversary and each of the annual anniversaries of the project start date. The agreement can
be terminated by either party upon written notice or if the Company remains in default on any payments due under this agreement for more
than 30 days. During the years ended December 31, 2023 and 2022, the Company recognized $ 260,752 ( 205,857) and $ 322,767 ( 265,156),
respectively, of research and development expenses in connection with the 3 Year Oxford Agreement.

 On September 21, 2020, CBR
Pharma entered into a 2 year research and development agreement (the "2 Year Oxford Agreement") with Oxford University for
the clinical development of cannabinoid drugs for the treatment of inflammatory diseases in exchange for aggregate consideration of $ 625,124
( 458,000), of which $ 138,917 ( 101,778) is to be paid 30 days after the project start date and the remaining amount is to
be paid every 6 months after the project start date in 4 installments, whereby $ 138,917 ( 101,778) is to be paid in the first 3
installments and $ 69,456 ( 50,888) is to be paid as the final installment. The agreement can be terminated by either party upon
written notice or if the Company remains in default on any payments due under this agreement for more than 30 days. During the years ended
December 31, 2023 and 2022, the Company recognized $0 ( 0) and $ 123,891 ( 101,778), respectively, of research and development
expenses in connection with the 2 Year Oxford Agreement, which is reflected within accrued expenses on the accompanying consolidated balance
sheet.

 As of December 31, 2023 and
2022, the Company owed Oxford no monies for the 2-year agreement.

 On May 24, 2021, the Company
entered into a research agreement with the University of Oxford ("Oxford" and the "Fifth Oxford Agreement"), pursuant
to which the Company will sponsor work at the University of Oxford to conduct a multi-center, randomized, double blind, parallel group,
feasibility study of anti-TNF injection for the treatment of adults with frozen shoulder during the pain-predominant phase. As a consideration,
the Company agreed to make the following payments to Oxford:

 Amount Due

 (excluding VAT)

 Upon signing of the Fifth Oxford Agreement

 6 months post signing of the Fifth Oxford Agreement

 12 months post signing of the Fifth Oxford Agreement

 24 months post signing of the Fifth Oxford Agreement

 F- 30

 The Company paid the first
milestone of $ 97,900 ( 70,546) on September 3, 2021, which was due upon signing of the Fifth Oxford Agreement, which was recorded
to prepaid expenses and will be amortized over the term of the agreement on a straight-line basis. During the years ended December 31,
2023 and 2022, the Company recorded $ 74,465 ( 58,788) and $ 271,931 ( 223,394), respectively, of research and development expenses
and has prepaid balances of $0 ( 0) and $ 14,233 ( 11,756), respectively, related to the Fifth Oxford Agreement.

 On November 2, 2021, the Company
and Oxford University entered into a twenty-year licensed technology agreement of the HMGB1 molecule, which is related to tissue regeneration,
whereby Oxford University agreed to license the technology to the Company for research, development and use of the licensed patents. The
Company agreed to pay Oxford University for past patent costs $ 66,223 ( 49,207), an initial License fee of $ 13,458 ( 10,000),
future royalties based on sales and milestones, and an annual maintenance fee of $ 4,037 ( 3,000). The Company has the option to
terminate the agreement after the third anniversary of the agreement. During the years ended December 31, 2023 and 2022, the Company recorded
$ 721,362 and $ 10,581, respectively, of research and development expenses related to this agreement.

 Due
to the ongoing costs of the HMGB1 research program and the need for the Company to focus its resources on the Company's primary
platform to treat fibrosis using anti-TNF (tumor necrosis factor), the Board of Directors of the Company elected to terminate the Company's
HMGB1 license agreement with Oxford on September 22, 2023, and on September 22, 2023, the Company and Oxford entered into a termination
letter, formally terminating the License effective September 22, 2023. The termination letter also clarified amounts that we owed after
termination of the License, including approximately $ 20,000 in unbilled fees. No material early termination penalties were incurred by
the Company in connection with the termination of the license.

 Due to recent financial constraints,
the Company has been unable to timely pay amounts due to Oxford, the licensor of the majority of the Company's licenses and patents
and the Company's research partner. Oxford alleges that an aggregate of approximately 929,030 is owed from the Company and
one of its subsidiaries to Oxford under the terms of licenses and agreements with Oxford and related parties. The Company is currently
in ongoing discussions with Oxford to reduce that amount and enter into a payment plan with regards to the amounts owed; however, no definitive
terms or extensions have been agreed to date. Oxford has also notified the Company that it is not willing to discuss any new projects
or arrangements until all outstanding invoices have been paid or a payment plan has been agreed to; has engaged a law firm to seek the
collection of the amounts owed, together with interest; and has threatened legal proceedings against us. While we are hopeful that we
can come to mutually agreeable terms regarding a settlement, payment plan, and/or extension, with Oxford, we may not have sufficient funds
to pay amounts due to Oxford in the near term, if at all, and Oxford may take action against us, including filing legal proceedings against
us seeking amounts due and interest, attempting to terminate their relationship with us, and/or filing a wind-up petition against one
of the Company's subsidiaries in the UK. If Oxford were to take legal action against us or terminate their relationship with us,
we may be forced to scale back our business plan and/or seek bankruptcy protection. We may be subject to litigation and damages for our
failure to pay amounts due to Oxford, and may be forced to pay interest and penalties, which funds we do not currently have.

 Kennedy License Agreement

 On September 27, 2019, 180
LP entered into a license agreement (the "Kennedy License Agreement") with the Kennedy Trust for Rheumatology Research ("Kennedy")
exclusively in the U.S., Japan, United Kingdom and countries of the EU, for certain licensed patents (the "Kennedy Licensed Patents"),
including the right to grant sublicenses, and the right to research, develop, sell or manufacture any pharmaceutical product (i) whose
research, development, manufacture, use, importation or sale would infringe the Kennedy Licensed Patents absent the license granted under
the Kennedy License Agreement or (ii) containing an antibody that is a fragment of or derived from an antibody whose research, development,
manufacture, use, importation or sale would infringe the Kennedy Licensed Patents absent the license granted under the Kennedy License
Agreement, for all human uses, including the diagnosis, prophylaxis and treatment of diseases and conditions.

 As a consideration for the
grant of the Kennedy Licensed Patents, 180 LP paid Kennedy an upfront fee of GBP 60,000, (USD $ 74,000) on November 22, 2019, which
was recognized as an intangible asset for the purchase of the licensed patents and is being amortized over the remaining life of the patents.
 180 LP will also pay Kennedy royalties equal to (i) 1% of the net sales for the first annual GBP 1 million (USD $1,283,400) of
net sales, and (ii) 2% of the net sales after the net sales are at or in excess of GBP 1 million, as well as 25% of all sublicense
revenue, provided that the amount of such percentage of sublicense revenue based on amounts which constitute royalties shall not be less
than 1% on the first cumulative GBP 1 million of net sales of the products sold by such sublicenses or their affiliates, and 2%
on that portion of the cumulative net sales of the products sold by such sublicenses or their affiliates in excess of GBP 1 million.

 The term of the royalties
paid by the Company to Kennedy will expire on the later of (i) the last valid claim of a patent included in the Kennedy Licensed Patents
which covers or claims the exploitation of a product in the applicable country; (ii) the expiration of regulatory exclusivity for the
product in the country; or (iii) 10 years from the first commercial sale of the product in the country. The Kennedy License Agreement
may be terminated without cause by providing a 90-day notice.

 F- 31

 Petcanna Sub-License Agreement

 On August 20, 2018, CBR Pharma
entered into a sub-license agreement (the "Sub-License Agreement") with its wholly owned subsidiary, Petcanna Pharma Corp.
("Petcanna"), of which the Company's former Chief Financial Officer is a director. Petcanna is a private company with
one common principal with the Company.

 Pursuant to the terms of the
Sub-license Agreement, the Company has granted a sub-license on the Licensed Patents to pursue development and commercialization for the
treatment of all veterinary conditions. In consideration, Petcanna will (a) issue 450,000 common shares of its share capital (the
"Petcanna Shares") 30 days after the effective date; and (b) pay royalties of 1 % of net sales. The Company will be issued
 85 % and Yissum will be issued 15 % of the 450,000 common shares of the Petcanna subsidiary. The Petcanna shares are deemed to be founders
shares with no value. The Petcanna shares have not been issued as of December 31, 2023.

 Operating Leases

 In February 2016, the FASB
issued an update to the Accounting Standards Codification Topic 842, Leases ("ASC 842"). The new standard required
most leases to be recognized on the balance sheet as a right-of-use ("ROU") asset and a lease liability. The right-of-use
asset is initially measured at the present value of amounts expected to be paid over the lease term. Recognition of the costs of these
leases on the income statement are disaggregated and recognized as both operating expense (for the amortization of the right-of-use asset)
and interest expense (for the portion of the lease payment related to interest). This standard was adopted by the Company upon issuance.

 In accordance with ASC 842,
the Company can elect (by asset class) not to record on the balance sheet a lease whose term is 12 months or less and does not include
a purchase option that the lessee is reasonably certain to exercise. If elected, the lease would be treated like an operating lease under
previous GAAP; payments would be recognized on a straight-line basis over the lease term. When determining whether the lease qualifies
for this election, the Company would include renewal options only if they are considered part of the lease term, i.e., those options the
Company is reasonably certain to exercise. If the lease term increases to more than 12 months, or if it is reasonably certain the Company
will exercise a purchase option, the Company would no longer be able to apply this practical expedient and would apply ASC 842 guidance.

 Regarding leases (of which
it currently has none), the Company would use the practical expedient for short-term operating leases that are 12 months or less. This
practical expedient has been elected as a package and it would be applied consistently to all leases. Additionally, if the Company's
leases are considered operating in nature and therefore not reflected on the balance sheet, the Company will recognize the short-term
lease payments as rent/lease expense monthly on the income statement.

 As of December 31, 2023 and
2022, the Company had no leases as well as no lease or rent expense as of those dates.

 Consulting Agreements

 Nanchahal Consulting Agreement

 On February 22, 2021, the
Company entered into a consultancy agreement (as amended, the "Consulting Agreement") with a related party, Prof. Jagdeep
Nanchahal (the "Consultant"). The Consulting Agreement was effective December 1, 2020.

 Pursuant to the Consulting
Agreement, the Company agreed to pay the Consultant 15,000 British Pounds (GBP) per month (approximately $ 20,800) during the term of the
agreement, increasing to 23,000 GBP per month (approximately $ 32,000) on the date (a) of publication of the data from the phase 2b clinical
trial for Dupuytren's Contracture (RIDD) and (b) the date that the Company has successfully raised over $ 15 million in capital.
The Company also agreed to pay the Consultant the following bonus amounts:

 the sum of 100,000 (approximately $ 138,000) upon submission of the Dupuytren's Contracture clinical trial data for publication in a peer-reviewed journal ("Bonus 1");

 the sum of 434,673 GBP (approximately $ 605,000) ("Bonus 2"), which is earned and payable upon the Company raising a minimum of $ 15 million in additional funding, through the sale of debt or equity, after December 1, 2020 (the "Vesting Date"). Bonus 2 is payable within 30 days of the Vesting Date and shall not be accrued, due or payable prior to the Vesting Date. Bonus 2 is payable, at the election of the Consultant, at least 50 % (fifty percent) in shares of the Company's common stock, at the lower of (i) $ 1,140.00 per share, or (ii) the trading price on the date of the grant, with the remainder paid in GBP;

 the sum of 5,000 (approximately $ 7,000) on enrollment of the first patient to the phase 2 frozen shoulder trial ("Bonus 3"); and

 the sum of 5,000 (approximately $ 7,000) for enrollment of the first patient to the phase 2 delirium/POCD trial ("Bonus 4").

 F- 32

 The Consulting Agreement has
an initial term of three years, and renews thereafter for additional three-year terms, until terminated as provided in the agreement.
The Consulting Agreement can be terminated by either party with 12 months prior written notice (provided the Company's right to
terminate the agreement may only be exercised if the Consultant fails to perform his required duties under the Consulting Agreement),
or by the Company immediately under certain conditions specified in the Consulting Agreement if (a) the Consultant fails or neglects efficiently
and diligently to perform the services required thereunder or is guilty of any breach of its or his obligations under the agreement (including
any consent granted under it); (b) the Consultant is guilty of any fraud or dishonesty or acts in a manner (whether in the performance
of the services or otherwise) which, in the reasonable opinion of the Company, has brought or is likely to bring the Consultant, the Company
or any of its affiliates into disrepute or is convicted of an arrestable offence (other than a road traffic offence for which a non-custodial
penalty is imposed); or (c) the Consultant becomes bankrupt or makes any arrangement or composition with his creditors. If the Consulting
Agreement is terminated by the Company for any reason other than cause, the Consultant is entitled to a lump sum payment of 12 months
of his fee as of the date of termination.

 Effective March 30, 2021,
in satisfaction of amounts owed to the Consultant for 50 % of Bonus 2, the Company issued 265 shares of the Company's common stock
to the Consultant. Additionally, on April 15, 2021, in satisfaction of amounts owed to the Consultant for an additional 19 % of Bonus 2,
the Company issued 100 shares of the Company's common stock to the Consultant.

 Effective August 27, 2021,
in satisfaction of amounts owed to the Consultant for the remainder of Bonus 2, the Company issued 162 shares of the Company's common
stock to the Consultant since the Company raised $ 15 million in a financing transaction, as per the agreement. All issuances were made
under the Company's 2020 Omnibus Incentive Plan. See Note 10 – Stockholders' (Deficit) Equity.

 In December 2021, the Dupuytren's
Contracture clinical trial data was submitted for publication in a peer-reviewed journal and Bonus 1 was paid to the Consultant.

 On April 27, 2022, the Company
entered into an Amendment to the Consulting Agreement, whereby upon acceptance of the data for the Phase 2b clinical trial for Dupuytren's
Contracture for publication, the Consultant's monthly fee will increase to 23,000, provided that 4,000 of such increase
will be accrued and 19,000 of such fees will be payable monthly per the payroll practices of the Company in cash effective March
1, 2022 and until the earlier of (a) November 1, 2022 or (b) the date upon which the Company has sufficient cash on hand to pay the accrued
amount, which the Company expects will not be until it has raised a minimum of $ 15,000,000 (the "Funding Determination Date"),
at which time the accrued amount will be due.

 On December 28, 2022, the
Company entered into an Amendment to the Consulting Agreement, whereby the Consultant's monthly fee will increase to 35,000
beginning on January 1, 2023 until the end of the term of the agreement; if the agreement is terminated by the Company for any reason
other than cause, the consultant will be entitled to a lump sum payment of 12 months of his monthly fee as of the date of termination.

 Feldmann Consulting Agreements

 On June 1, 2018, CannBioRex
Pharma Limited (" CannBioRex ") and Prof. Sir Marc Feldmann Ph. D., our Executive Co-Chairman, entered into a consulting
agreement; pursuant to the agreement, Prof. Sir Feldmann serves as the Chairman, CEO and Executive Director of CannBioRex or in such other
capacity consistent with his status. Prof. Sir Feldmann receives compensation of 115,000 per year, with annual compensation reviewed
by the Board and eligibility for discretionary bonuses, as determined by the Board. CannBioRex also reimburses Prof. Sir Feldmann's
travelling and other business expenses.

 The agreement contains a customary
non-compete clause prohibiting Prof. Sir Feldmann from working for any competing businesses during the term of his employment, or holding
equity in other businesses, except he may hold or beneficially own securities of publicly-traded companies if the aggregate beneficial
interests of him and his family does not exceed 5% of that class of securities. The agreement does not have a fixed term, and either party
may terminate the agreement by delivering written notice 9 months in advance. CannBioRex may also terminate the agreement at any time
with immediate effect by giving written notice. If CannBioRex terminates Prof. Sir Feldmann's employment without providing 9 months
written notice, he will become entitled to a payment equal to his basic salary he would have been entitled to receive if 9 months'
notice were given.

 F- 33

 On November 17, 2021, the
Board, as recommended by the Compensation Committee, increased the salary of Prof. Sir Feldmann to $ 225,000 per annum.

 Effective on April 27, 2022,
CannBioRex and Prof. Sir Feldmann entered into an amendment to the consulting agreement, pursuant to which the parties agreed effective
March 1, 2022, that Sir Feldmann's paid salary would be reduced by $ 225,000 (100%), and that the reduction would be accrued for
and paid on a future date. On December 26, 2023, the Board approved payment of an aggregate net pay amount for the period from March 2022
through December 31, 2023 of $ 232,970 in consideration for services rendered; at Prof. Sir Feldmann's discretion, such payment was
made by the issuance of 7,126 shares of common stock at a share price of $ 32.68, with a market price of $ 3.99. The Company recognized
a gain on the issuance of common stock for services of $ 204,405.

 On January 1, 2024, the Company
entered into another amendment to this employment agreement; see Note 13 – Subsequent Events, Amendment to Compensation Agreements
for additional information.

 Larsen Consulting Agreements

 On April 29, 2021, the Company
entered into a consulting agreement with Glenn Larsen, the former Chief Executive Officer of 180 LP, to act in the capacity of a negotiator
for the licensing of four patents. In consideration for services provided, the Company agreed to compensate Mr. Larsen with $ 50,000 of
its restricted common stock (valued based on the closing sales price of the Company's common stock on the date the Board of Directors
approved the agreement, which shares have not been issued to date). The fully vested shares will be issued to Mr. Larsen pursuant to the
2020 Omnibus Incentive Plan, upon the Company entering into a licensing transaction with the assistance of Mr. Larsen. On November
2, 2021, the Company and Oxford University entered into a license agreement and therefore 15 shares were issued to Mr. Larsen on November
3, 2021 pursuant to the Company's 2020 Omnibus Incentive Plan.

 On February 22, 2023, the
Company entered into a second consulting agreement with Glenn Larsen to provide consulting services; in consideration for the services
provided, the Company agreed to compensate Mr. Larsen in the amount of $ 10,000 per month; the amounts owed may be settled in cash or shares
of the Company's common stock (which will be subject to the Company's 2022 Omnibus Incentive Plan or another approved equity
compensation plan) or a combination of both at the option of Mr. Larsen. No shares may be issued and cash will be the default payment
method for fees until an increase in shares available in the Plan is approved and any issuance is conditioned upon the Company having
sufficient shares in the Plan to be issued. Mr. Larsen is also eligible to participate in the Company's stock option plan, subject
to approval from the Board of Directors. The initial term of the agreement is for three years from the effective date of the contract
and shall automatically extend for additional one-year periods. As of December 31, 2023 and 2022, the Company has accrued balances for
services due to Mr. Larsen of $ 60,000 and $ 10,000, respectively.

 Steinman Consulting Agreement

 On
November 17, 2021, and effective on November 1, 2021, the Company entered into a Consulting Agreement with Lawrence Steinman, M.D., the
Company's Executive Co-Chairman (the " Consulting Agreement "). Pursuant to the Consulting Agreement, Dr. Steinman
agreed to provide certain consulting services to the Company, including, but not limited to, participating in defining and setting strategic
objectives of the Company; actively seeking out acquisition and merger candidates; and having primary scientific responsibility for the
Company's a 7nAChR platform (collectively, the " Services "). The term of the agreement is for one year (the
" Initial Term "); provided that the agreement automatically extends for additional one year periods after the Initial
Term (each an " Automatic Renewal Term " and the Initial Term together with all Automatic Renewal Terms, if any, the
" Term "), subject to the Renewal Requirements (described below), in the event that neither party provided the other
written notice of their intent not to automatically extend the term of the agreement at least 30 days prior to the end of the Initial
Term or any Automatic Renewal Term. The Term can only be extended for an Automatic Renewal Term, provided that (i) Dr. Steinman is re-elected
to the Board of Directors (the " Board ") at the Annual Meeting of Stockholders of the Company immediately preceding
the date that such Automatic Renewal Term begins; (ii) the Board affirms his appointment as Co-Chairman for the applicable Automatic Renewal
Term (or fails to appoint someone else as Co-Chairman prior to such applicable Automatic Renewal Term) and (iii) Dr. Steinman is continuing
in his role of having the responsibility for the scientific development for the Company's a 7nAChR platform (the " Renewal
Requirements "). The Consulting Agreement also expires immediately upon the earlier of: (i) the date upon which Dr. Steinman
no longer serves as Co-Chairman and no longer has primary scientific responsibility for our a 7nAChR platform; and (ii) any earlier
date requested by either (1) the Company (as evidenced by a vote of a majority of the Board (excluding Dr. Steinman) at a meeting of the
Board), or (2) Dr. Steinman (as evidenced by written notice from Dr. Steinman to the Board). Additionally, the Company may terminate the
Consulting Agreement immediately and without prior notice if Dr. Steinman is unable or refuses to perform the Services, and either party
may terminate the Consulting Agreement immediately and without prior notice if the other party is in breach of any material provision
of the Consulting Agreement.

 F- 34

 The
Company agreed to pay Dr. Steinman $ 225,000 per year during the term of the agreement, along with a one-time payment of $ 43,750, representing
the difference between his old compensation and new compensation, dating back to April 1, 2021. Pursuant to the Consulting Agreement,
Dr. Steinman agreed to not compete against the Company, unless approved in writing by the Board of Directors, during the term of the agreement,
and also agreed to certain customary confidentiality provisions and assignment of inventions requirements. The Consulting Agreement also
has a 12-month non-solicitation prohibition following its termination.

 Effective
on April 27, 2022, the Company and Dr. Steinman entered into an amendment to the consulting agreement, pursuant to which the parties agreed
effective March 1, 2022, that Dr. Steinman's salary would be reduced by $ 56,250 ( 25 %), and that such reduced amount would be accrued
and paid on the Funding Determination Date. On January 1, 2024, the Company entered into another amendment to this employment agreement;
see Note 13 – Subsequent Events, Amendment to Compensation Agreements for additional information.

 Employment Agreement of Chief Executive Officer

 On February 25, 2021, the
Company entered into an amended agreement with Dr. James Woody, the Chief Executive Officer of the Company (the "CEO") (the
"A&R Agreement"), dated February 24, 2021, and effective November 6, 2020, which replaced the CEO's prior agreement
with the Company. Pursuant to the A&R Agreement, the CEO agreed to serve as an officer of the Company for a term of three years, which
is automatically renewable thereafter for additional one-year periods, unless either party provides the other at least 90 days written
notice of their intent to not renew the agreement. The CEO's annual base salary under the agreement was initially $ 450,000 per year,
with automatic increases of 5 % per annum.

 As additional consideration
for the CEO agreeing to enter into the agreement, the Company awarded him options to purchase 3,685 shares of the Company's common
stock, which have a term of 10 years, and an exercise price of $ 1,683.40 per share (the closing sales price on the date the board of
directors approved the grant (February 26, 2021)). The options as subject to the Company's 2020 Omnibus Incentive Plan and vest
at the rate of (a) 1/5 th of such options on the grant date; and (b) 4/5 th of such options vesting ratably
on a monthly basis over the following 36 months on the last day of each calendar month; provided, however, that such options vest immediately
upon the CEO's death or disability, termination without cause or a termination by the CEO for good reason (as defined in the agreement),
a change in control of the Company or upon a sale of the Company.

 The CEO is also eligible
to receive an annual bonus, with a target bonus equal to 45 % of his then-current base salary, based upon the Company's achievement
of performance and management objectives as set and approved by the Board of Directors and/or Compensation Committee in consultation
with the CEO. At the CEO's option, the annual bonus can be paid in cash or the equivalent value of the Company's common stock
or a combination. The Board of Directors, as recommended by the Compensation Committee, may also award the CEO bonuses from time to time
(in stock, options, cash, or other forms of consideration) in its discretion. Under the A&R Agreement, the CEO is also eligible to
participate in any stock option plans and receive other equity awards, as determined by the Board of Directors from time to time. As
of December 31, 2023 and 2022, the Company had accrued bonus balances of $ 482,406 and $ 313,875, respectively, payable to the CEO. See
Note 13 – Subsequent Events, Reversal of Accrued Bonuses, for further information.

 The A&R agreement can
be terminated any time by the Company for cause (subject to the cure provisions of the agreement), or without cause (with 60 days prior
written notice to the CEO), by the CEO for good reason (as described in the agreement, and subject to the cure provisions of the agreement),
or by the CEO without good reason. The agreement also expires automatically at the end of the initial term or any renewal term if either
party provides notice of non-renewal as discussed above.

 In the event the A&R Agreement
is terminated without cause by the Company, or by the CEO for good reason, the Company agreed to pay him the lesser of 18 months of salary
or the remaining term of the agreement, the payment of any accrued bonus from the prior year, his pro rata portion of any current year's
bonus and health insurance premiums for the same period that he is to receive severance payments (as discussed above).

 The A&R Agreement contains
standard and customary invention assignment, indemnification, confidentiality and non-solicitation provisions, which remain in effect
for a period of 24 months following the termination of his agreement.

 F- 35

 On April 27, 2022, the Company
entered into an Amendment to the Employment Agreement, whereby the Company will provide a 3 % increase in salary and a 20 % accrual of salary,
until such time as the Board of Directors determines that the Funding Determination Date has occurred. On January 1, 2024, the Company
entered into another amendment to this employment agreement; see Note 13 – Subsequent Events, Amendment to Compensation Agreements
for additional information.

 Employment Agreement of Chief Financial Officer

 On February 25, 2021, the
Company entered into an Employment Agreement (the "CFO Agreement") dated February 24, 2021, and effective November 6, 2020,
with the Company's Interim Chief Financial Officer, Ozan Pamir. Pursuant to the agreement, the CFO agreed to serve as the Interim
Chief Financial Officer ("CFO") of the Company for an initial salary of $ 300,000 per year, subject to increase to a mutually
determined amount upon the closing of a new financing as well as annual increases.

 As additional consideration
for the CFO agreeing to enter into the agreement, the Company awarded him options to purchase 474 shares of the Company's common
stock, which have a term of 10 years, and an exercise price of $ 1,683.40 per share (the closing sales price on the date the board of directors
approved the grant (February 26, 2021)). The options are subject to the Company's 2020 Omnibus Incentive Plan and vest at th e
rate of (a) 1/5th of such options upon the gran t date; and (b) 4/5th of such options vesting ratably on a monthly
basis over the following 36 months on the last day of each calendar month; provided, however, that such options vest immediately upon
the CFO's death or disability, termination without cause or a termination by the CFO for good reason (as defined in the agreement),
a change in control of the Company or upon a sale of the Company.

 Under the agreement, the CFO
is eligible to receive an annual bonus, in a targeted amount of 30 % of his then salary, based upon the Company's achievement of
performance and management objectives as set and approved by the CEO, in consultation with the CFO. The bonus amount is subject to adjustment.
The Board of Directors, as recommended by the Compensation Committee of the Company (and/or the Compensation Committee), may also award
the CFO bonuses from time to time (in stock, options, cash, or other forms of consideration) in its discretion. Under the CFO Agreement,
the CFO is also eligible to participate in any stock option plans and receive other equity awards, as determined by the Board of Directors
from time to time. As of December 31, 2023 and 2022, the Company had accrued bonus balances of $ 254,625 and $ 139,500, respectively, payable
to the CFO. See Note 13 – Subsequent Events, Reversal of Accrued Bonuses, for further information.

 Additionally, on January 1,
2024, the Company entered into another amendment to this employment agreement; see Note 13 – Subsequent Events, Amendment to
Compensation Agreements, for additional information.

 The agreement can be terminated
at any time by the Company with or without cause with 60 days prior written notice and may be terminated by the CFO at any time with 60
days prior written notice. The agreement may also be terminated by the Company with six days' notice in the event the agreement
is terminated for cause under certain circumstances. Upon the termination of the CFO's agreement by the Company without cause or
by the CFO for good reason, the Company agreed to pay him three months of severance pay.

 The agreement contains standard
and customary invention assignment, indemnification, confidentiality, and non-solicitation provisions, which remain in effect for a period
of 24 months following the termination of his agreement.

 Employment Agreement of Chief Operating Officer/Chief
Business Officer

 On October 29, 2021, the Company
entered into an Employment Agreement (the "COO/CBO Agreement") dated October 27, 2021, and effective November 1, 2021 (the
"Start Date"), with Quan Vu. Pursuant to the agreement, Mr. Vu agreed to serve as the Chief Operating Officer/Chief Business
Officer ("COO/CBO") of the Company for an initial salary of $ 390,000 per year, subject to a $ 10,000 increase upon completion
of a $ 50 Million financing and a yearly increase of five percent ( 5 %) on each start-day anniversary.

 F- 36

 As additional consideration
for Mr. Vu agreeing to enter into the agreement, the Company awarded him options to purchase 724 shares of the Company's common
stock, which have a term of 10 years, and an exercise price of $ 1,501.00 per share. The options are subject to the Company's 2020
Omnibus Incentive Plan and vest ratably on a monthly basis over the following 48 months on the last day of each calendar month; provided,
however, that such options were to vest immediately upon Mr. Vu's death or disability, termination without cause or a termination
by Mr. Vu for good reason (as defined in the agreement), a change in control of the Company or upon a sale of the Company.

 Under the agreement, Mr. Vu
was eligible to receive an annual bonus, in a targeted amount of 50 % of his then salary, based upon the Company's achievement of
performance and management objectives as set and approved by the CEO, in consultation with the CFO. The annual bonus was to be paid on
or before March 31 of the year following the year in which the bonus is earned. At the choice of the Executive, the annual bonus could
be paid in cash or the equivalent value of the Company's common stock or a combination of both. For calendar 2021, such Bonus payment,
if any, was to be prorated for approximately 2 months after the Start Date. The CEO, as approved by the Compensation Committee, may also
award the Executive a bonus from time to time (in stock, options, cash, or other forms of consideration) at his discretion.

 The agreement could be terminated
at any time by the Company with or without cause with 30 days prior written notice and could be terminated by Mr. Vu at any time with
30 days prior written notice. The agreement could also be terminated by the Company with ten days' notice in the event the agreement
is terminated for cause under certain circumstances. Upon the termination of Mr. Vu's agreement by the Company without cause or
by Mr. Vu for good reason, the Company agreed to pay him twelve months of severance pay, except if Executive separates from the Company
prior to a one-year anniversary.

 The agreement contained standard
and customary invention assignment, indemnification, confidentiality, and non-solicitation provisions, which remain in effect for a period
of 24 months following the termination of his agreement.

 On April 27, 2022, the Company
entered into an Amendment to the Employment Agreement, whereby the Company agreed to provide a 3 % increase in salary and a 20% accrual
of salary, until such time as the Board of Directors determined that the Funding Determination Date had occurred. As of December 31, 2022,
the Company had an accrued bonus balance of $ 221,000 payable to Mr. Vu.

 Effective January 15, 2023,
the Company and Mr. Vu mutually agreed to terminate Vu's employment. In accordance with the termination, the parties entered into
a separation agreement, whereby the Company agreed to pay Mr. Vu an agreed-upon severance payment including accrued back-pay, agreed-upon
health insurance expenses and accrued paid time-off for a total amount of $ 407,135.

 Employment Agreement of Chief Scientific Officer

 On August 21, 2019, the Company
entered into an employment agreement with Dr. Jonathan Rothbard. The agreement has a term of three years, automatically extending for
additional one-year terms thereafter unless either party terminates the agreement with at least 90 days prior written notice before the
next renewal date, and provides for a salary of $ 375,000 per year, with automatic increases in salary, on the first anniversary of the
effective date, and each anniversary thereafter, of 10 %. For 2023, Dr. Rothbard's salary was $ 200,000, which represents Dr. Rothbard's
commitment of 50 % of his work-related time to us. The Board of Directors, as recommended by the Compensation Committee, may increase Dr.
Rothbard's salary from time to time, which increases do not require an amendment to his agreement.

 The agreement provides for
Dr. Rothbard to receive an annual bonus subject to meeting certain objectives set by the Board of Directors, with a targeted bonus amount
of 50 % of his salary, payable on or before February 15 th of each year; Dr. Rothbard is also eligible to earn equity compensation
and bonuses from time to time at the discretion of the Board of Directors, which may be payable in cash, stock or options. As of December
31, 2023, the Company had an accrued bonus balance of $ 305,625 payable to Dr. Rothbard. See Note 13 – Subsequent Events, Reversal
of Accrued Bonuses, for further information.

 F- 37

 In the event Dr. Rothbard's
employment is terminated by us without cause, by Dr. Rothbard for good reason (as discussed in the employment agreement), or the agreement
is not renewed by us, he is required to be paid 36 months of severance pay (if such termination occurs during the first year of the term);
24 months of severance pay (if such termination occurs during the second year of the term); and 12 months of severance pay (if such termination
occurs after the second year of the term), along with any accrued bonus amount and a pro rata annual bonus based on the targeted bonus,
as well as the payment of health insurance premiums for the same period over which he is required to be paid severance pay.

 The Employment Agreement was
amended effective January 1, 2022, to override the automatic annual salary increases of 10 % per annum and instead provide for future increases
in the sole determination of the Board of Directors. The Employment Agreement was further amended effective June 1, 2022, to adjust the
base salary of Dr. Rothbard to $ 193,125. See Note 13 – Subsequent Events, Amendment to Compensation Agreements for further
information.

 NOTE 10 - STOCKHOLDERS' (DEFICIT) EQUITY

 Reverse Stock Split during 2022

 On December 15, 2022, at a
Special Meeting of the Stockholders of the Company, the stockholders of the Company approved an amendment to the Company's Second
Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares of
our common stock, par value $ 0.0001 per share, by a ratio of between one-for-four to one-for-twenty, inclusive, with the exact ratio to
be set at a whole number to be determined by our Board of Directors or a duly authorized committee thereof in its discretion, at any time
after approval of the amendment and prior to December 15, 2023 (the "Stockholder Authority"). On December 15, 2022, the Company's
Board of Directors (the "Board"), with the Stockholder Authority, approved an amendment to our Second Amended and Restated
Certificate of Incorporation to affect a reverse stock split of our common stock at a ratio of 1-for-20 (the "Reverse Stock Split").
Pursuant to the Certificate of Amendment filed to affect the Reverse Stock Split, the Reverse Stock Split was effective on December 19,
2022 and the shares of the Company's common stock began trading on the NASDAQ Capital Market ("NASDAQ") on a post-split
basis on December 19, 2022, with new CUSIP number: 68236V203. No change was made to the trading symbol for the Company's shares
of common stock or public warrants, "ATNF" and "ATNFW", respectively, in connection with the Reverse Stock Split.

 Because the Certificate of
Amendment did not reduce the number of authorized shares of common stock, the effect of the Reverse Stock Split was to increase the number
of shares of common stock available for issuance relative to the number of shares issued and outstanding. The Reverse Stock Split did
not alter the par value of the common stock or modify any voting rights or other terms of the common stock. Any fractional shares remaining
after the Reverse Stock Split will be rounded up to the nearest whole share.

 With regards to the Company's
2020 Omnibus Incentive Plan and the 2022 Omnibus Incentive Plan, the Company's Compensation Committee and Board deem it in the best
interests of the Company and its stockholders to (i) adjust the number of shares of Company common stock available for issuance under
the Incentive Plans downward by a factor of 20 (with any fractional shares rounded down to the nearest whole share); (ii) reduce the number
of shares of common stock issuable upon each outstanding option to purchase shares of common stock of the Company, and all other outstanding
awards, by a factor of 20 (with any fractional shares rounded down to the nearest whole share); and (iii) adjust the exercise price of
any outstanding options to purchase shares of common stock previously granted under the Incentive Plans up by a factor of 20 (rounded
up to the nearest whole cent), in each case to adjust equitably for the Exchange Ratio of the Reverse Stock Split, which such adjustments
effective automatically upon effectiveness of the Reverse Stock Split. The effects of the one-for-twenty reverse stock split have been
retroactively reflected throughout the financial statements and notes to the financial statements.

 Reverse Stock Split during 2024

 On February 16, 2024, at a
Special Meeting of the Stockholders of the Company, the stockholders of the Company approved an amendment to the Company's Second
Amended and Restated Certificate of Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares of
our common stock, par value $ 0.0001 per share, by a ratio of between one-for-four to one-for-forty, inclusive, with the exact ratio to
be set at a whole number to be determined by our Board of Directors or a duly authorized committee thereof in its discretion, at any time
after approval of the amendment and prior to February 16, 2025. On February 16, 2024, the Company's Board approved an amendment
to our Second Amended and Restated Certificate of Incorporation to affect a reverse stock split of our common stock at a ratio of 1-for-19.
Pursuant to the Certificate of Amendment filed to affect the Reverse Stock Split, the Reverse Stock Split was effective on February 28,
2024 and the shares of the Company's common stock began trading on NASDAQ on a post-split basis on February 28, 2024, with new CUSIP
number: 68236V302. No change was made to the trading symbol for the Company's shares of common stock or public warrants, "ATNF"
and "ATNFW", respectively, in connection with the Reverse Stock Split.

 In
addition, the number of shares of common stock issuable upon exercise of stock options and other equity awards (including shares reserved
for issuance under the Company's equity compensation plans) were proportionately adjusted by the applicable administrator, using
the 1-for-19 ratio, and rounded down to the nearest whole share. The conversion rates of the Company's preferred stock (of which
none are outstanding) will also be adjusted in a ratio of 1-for-19. The number of shares issuable upon exercise of the Company's
outstanding warrants to purchase shares of common stock outstanding will also be equitably adjusted pursuant to the terms of such securities
in connection with the 1-for-19 Reverse Stock Split. In addition, the exercise price for each outstanding stock option and warrant will
be increased in inverse proportion to the 1-for-19 split ratio such that upon an exercise, the aggregate exercise price payable by the
optionee or warrant holder to the Company for the shares subject to the option or warrant will remain approximately the same as the aggregate
exercise price prior to the Reverse Stock Split, subject to the terms of such securities.

 F- 38

 Further,
pursuant to the terms of the Company's Class K Special Voting Shares (the " Voting Stock "), following the Effective
Time, the Voting Stock was convertible into a number of shares of common stock equal to, and votes a number of voting shares equal to,
 14 shares; provided that such Class K Special Voting Shares were subsequently converted into 14 shares of common stock on March 14, 2024.

 Each
stockholder's percentage ownership interest in the Company and proportional voting power remains virtually unchanged as a result
of the Reverse Stock Split, except for minor changes and adjustments that will result from rounding fractional shares into whole shares.
The rights and privileges of the holders of shares of common stock will be substantially unaffected by the Reverse Stock Split.

 Preferred Stock

 Pursuant to the Company's
Second Amended and Restated Certificate of Incorporation filed on November 6, 2020, the Company has 5,000,000 preferred shares authorized
at a par value of $ 0.0001 per share, of which 1,000,000 shares are designated as Series A Convertible Preferred Stock ("Series A
Preferred"), 1 share is designated as the Class K Special Voting Share and 1 share is designated as the Class C Special Voting Share.
The Class K Special Voting Share and the Class C Special Voting Share are together, the "Special Voting Shares". As of December
31, 2023, there is no Series A Preferred issued or outstanding; there is one Class K Special Voting Share and one Class C Special Voting
Share issued and outstanding. As of the date of this Report, there are no Series A Preferred, Class K Special Voting Shares or Class C
Special Voting Shares outstanding.

 The Special Voting Shares
have a par value of $ 0.0001 per share. The rights and preferences of each Special Voting Shares consists of the following:

 the right to vote in all circumstances in which our common stock have the right to vote, with the common stock as one class;

 the Special Voting Shares entitle the holder Odyssey Trust Company (the Trustee) to an aggregate number of votes equal to the number of shares of common stock that were issuable to the holders of the previously outstanding shares of CannBioRex Purchaseco ULC and/or Katexco Purchaseco ULC, Canadian subsidiaries of 180 (the " Exchangeable Shares ");

 the holder of the Special Voting Shares (and, indirectly, the holders of the Exchangeable Shares) has the same rights as the holders of the common stock as to notices, reports, financial statements and attendance at all stockholder meetings;

 no entitlement to dividends;

 the holder of the Special Voting Shares is not entitled to any portion of any related distribution upon windup, dissolution or liquidation of the Company; and

 the Company may cancel the Special Voting Shares when there are no Exchangeable Shares outstanding and no option or other commitment of CannBioRex Purchaseco ULC and Katexco Purchaseco ULC which could require either CannBioRex Purchaseco ULC and Katexco Purchaseco ULC to issue more Exchangeable Shares.

 As set forth above, the holders
of the Exchangeable Shares, through the applicable Special Voting Share, have voting rights and other attributes corresponding to the
common stock. The Exchangeable Shares provide an opportunity for certain former Canadian resident holders of CBR Pharma or Katexco securities
to obtain a deferral of taxable capital gains for Canadian income tax purposes in connection with the Reorganization.

 F- 39

 Common Stock

 The Company is authorized
to issue 100,000,000 shares of the Company's common stock with a par value of $ 0.0001 per share. Holders of the Company's
shares of the Company's common stock are entitled to one vote for each share.

 July 2022 Offering

 On July 17, 2022, the Company
entered into a Securities Purchase Agreement with certain purchasers, pursuant to which the Company agreed to sell an aggregate of 9,211
shares of common stock, pre-funded warrants to purchase up to an aggregate of 6,927 shares of common stock ("July 2022 Pre-Funded
Warrants"), and common stock warrants to purchase up to an aggregate of 16,138 shares of common stock (the "July 2022 Common
Warrants"), at a combined purchase price of $ 402.80 per share and warrant (the "July 2022 Offering"). Aggregate gross
proceeds from the July 2022 Offering were $ 6,499,737. The July 2022 Offering closed on July 20, 2022.

 The July 2022 Pre-Funded Warrants
have an exercise price equal to $ 0.0019, are immediately exercisable and are subject to customary anti-dilution adjustments for stock
splits or dividends or other similar transactions. The exercise price of the July 2022 Pre-Funded Warrants will not be subject to adjustment
because of subsequent equity issuances at effective prices lower than the then-current exercise price. The July 2022 Pre-Funded Warrants
are exercisable until they are exercised in full. The July 2022 Pre-Funded Warrants are subject to a provision prohibiting the exercise
of such July 2022 Pre-Funded Warrants to the extent that, after giving effect to such exercise, the holder of such July 2022 Pre-Funded
Warrants (together with the holder's affiliates, and any other persons acting as a group together with the holder or any of the
holder's affiliates), would beneficially own in excess of 9.99 % of the Company's outstanding common stock (which may be increased
or decreased, with 61 days prior written notice by the holder). Although the July 2022 Pre-Funded Warrants have a tender offer provision,
the July 2022 Pre-Funded Warrants were determined to be equity-classified because they met the limited exception in the case of a change-in-control.
Because the July 2022 Pre-Funded Warrants are equity-classified, the placement agent fees and offering expenses were accounted for as
a reduction of additional paid in capital.

 The July 2022 Common Warrants
have an exercise price equal to $ 402.80 per share, are exercisable 6 months following the closing of the July 2022 Offering (the "Initial
Exercise Date") and are subject to customary anti-dilution adjustments for stock splits or dividends or other similar transactions.
The exercise price of the July 2022 Common Warrants will not be subject to adjustment as a result of subsequent equity issuances at effective
prices lower than the then-current exercise price. The July 2022 Common Warrants were originally exercisable for 5 years following the
Initial Exercise Date. The July 2022 Common Warrants are subject to a provision prohibiting the exercise of such July 2022 Common Warrants
to the extent that, after giving effect to such exercise, the holder of such July 2022 Common Warrants (together with the holder's
affiliates, and any other persons acting as a group together with the holder or any of the holder's affiliates), would beneficially
own in excess of 4.99 % of the Company's outstanding common stock (which may be increased or decreased, with 61 days prior written
notice by the holder). Although the July 2022 Common Warrants have a tender offer provision, the July 2022 Common Warrants were determined
to be equity-classified because they met the limited exception in the case of a change-in-control. Because the July 2022 Common Warrants
are equity-classified, the placement agent fees and offering expenses were accounted for as a reduction of additional paid in capital.

 During 2023, the Company
entered into a series of amendments to these warrants in April, August and November; such amendments changed the exercise price from
$ 402.80 to $ 33.82 (see Amendment to July and December 2022 Common Warrants section below), $ 15.77 (see Second Amendment to
Common Warrant Agreements for the July 2022, December 2022 and April 2023 Offerings section below), and $ 3.23 (see Amendment to
the August 2023 Offering section below), respectively. As of December 31, 2023, these warrants are not exercisable until the Company
obtains stockholder approval with respect to the 734,262 shares of common stock upon exercise of warrants issued in connection with the
Amendment to the August 2023 Offering (see Amendment to the August 2023 Offering section below), at which point the July 2022
Common Warrants will remain exercisable until the fifth anniversary of the stockholder approval date. The stockholder approval date occurred
on February 16, 2024, as discussed under Note 13 – Subsequent Events.

 As of December 31, 2023, all
 6,927 of the July 2022 Pre-Funded Warrants have been exercised for a value of $ 263; there are no unexercised July 2022 Pre-Funded Warrants
remaining as of the end of the year. No July 2022 Common Warrants have been exercised as of December 31, 2023.

 F- 40

 December 2022 Offering

 On December 20, 2022, the Company entered into a Securities Purchase
Agreement with certain purchasers, pursuant to which the Company agreed to sell an aggregate of 11,316 shares of common stock, pre-funded
warrants to purchase up to an aggregate of 78,910 shares of common stock ("December 2022 Pre-Funded Warrants"), and common
stock warrants to purchase up to an aggregate of 135,339 shares of common stock (the "December 2022 Common Warrants"), at
a combined purchase price of $ 66.50 per share and warrant (the "December 2022 Offering"). Aggregate gross proceeds from the
December 2022 Offering were approximately $ 6,000,000, and the December 2022 Offering closed on December 22, 2022.

 The December 2022 Pre-Funded
Warrants have an exercise price equal to $ 0.0019, are immediately exercisable and are subject to customary anti-dilution adjustments for
stock splits or dividends or other similar transactions. The exercise price of the December 2022 Pre-Funded Warrants will not be subject
to adjustment as a result of subsequent equity issuances at effective prices lower than the then-current exercise price. The December
2022 Pre-Funded Warrants are exercisable until they are exercised in full. The December 2022 Pre-Funded Warrants are subject to a provision
prohibiting the exercise of such December 2022 Pre-Funded Warrants to the extent that, after giving effect to such exercise, the holder
of such December 2022 Pre-Funded Warrants (together with the holder's affiliates, and any other persons acting as a group together
with the holder or any of the holder's affiliates), would beneficially own in excess of 4.99 % of the Company's outstanding
common stock (which may be increased or decreased, with 61 days prior written notice by the holder). Although the December 2022 Pre-Funded
Warrants have a tender offer provision, the December 2022 Pre-Funded Warrants were determined to be equity-classified because they met
the limited exception in the case of a change-in-control. Because the December 2022 Pre-Funded Warrants are equity-classified, the placement
agent fees and offering expenses were accounted for as a reduction of additional paid in capital.

 The December 2022 Common Warrants
have an exercise price equal to $ 66.50 per share, are exercisable 6 months following the closing of the December 2022 Offering (the "Initial
Exercise Date") (see Note 13 – Subsequent Events, " Amendment to Common Warrant Agreement for the December 2022 Offering")
and are subject to customary anti-dilution adjustments for stock splits or dividends or other similar transactions. The exercise price
of the December 2022 Common Warrants will not be subject to adjustment as a result of subsequent equity issuances at effective prices
lower than the then-current exercise price. The December 2022 Common Warrants were originally exercisable for 5 years following the Initial
Exercise Date. The December 2022 Common Warrants are subject to a provision prohibiting the exercise of such December 2022 Common Warrants
to the extent that, after giving effect to such exercise, the holder of such December 2022 Common Warrants (together with the holder's
affiliates, and any other persons acting as a group together with the holder or any of the holder's affiliates), would beneficially
own in excess of 4.99 % of the Company's outstanding common stock (which may be increased or decreased, with 61 days prior written
notice by the holder). Although the December 2022 Common Warrants have a tender offer provision, the December 2022 Common Warrants were
determined to be equity-classified because they met the limited exception in the case of a change-in-control. Because the December 2022
Common Warrants are equity-classified, the placement agent fees and offering expenses were accounted for as a reduction of additional
paid in capital.

 During 2023, the Company entered
into a series of amendments to these warrants in April, August and November; such amendments changed the exercise price from $ 402.80 to
$ 33.82 (see Amendment to July and December 2022 Common Warrants section below), $ 15.77 (see Second Amendment to Common Warrant
Agreements for the July 2022, December 2022 and April 2023 Offerings section below), and $ 3.23 (see Amendment to the August 2023
Offering section below), respectively. As of December 31, 2023, these warrants are not exercisable until the Company obtains stockholder
approval with respect to the 734,262 shares of common stock upon exercise of warrants issued in connection with the Amendment to the August
2023 Offering (see Amendment to the August 2023 Offering section below), at which point the December 2022 Common Warrants will
remain exercisable until the fifth anniversary of the stockholder approval date. The stockholder approval date occurred on February 16,
2024, as discussed under Note 13 – Subsequent Events.

 As of December 31, 2023, all
 78,910 of the December 2022 Pre-Funded Warrants have been exercised for a value of $ 150; there are no unexercised December 2022 Pre-Funded
Warrants remaining as of the end of 2023. No December 2022 Common Warrants have been exercised as of December 31, 2023.

 April 2023 Offering

 On April 5, 2023, the Company
entered into a Securities Purchase Agreement with certain purchasers, pursuant to which the Company agreed to sell an aggregate of 21,053
shares of common stock, pre-funded warrants to purchase up to an aggregate of 61,615 shares of common stock, and common stock warrants
to purchase up to an aggregate of 82,668 shares of common stock, at a combined purchase price of $ 36.29 per share and warrant (the "April
2023 Offering"). Aggregate gross proceeds from the April 2023 Offering were approximately $ 3,000,000, and the April 2023 Offering
closed on April 10, 2023.

 F- 41

 The April 2023 Pre-Funded
Warrants had an exercise price equal to $ 0.0019, were immediately exercisable and are subject to customary anti-dilution adjustments for
stock splits or dividends or other similar transactions. The exercise price of the April 2023 Pre-Funded Warrants will not be subject
to adjustment as a result of subsequent equity issuances at effective prices lower than the then-current exercise price. The April 2023
Pre-Funded Warrants are exercisable until they are exercised in full. The April 2023 Pre-Funded Warrants are subject to a provision prohibiting
the exercise of such April 2023 Pre-Funded Warrants to the extent that, after giving effect to such exercise, the holder of such April
2023 Pre-Funded Warrants (together with the holder's affiliates, and any other persons acting as a group together with the holder
or any of the holder's affiliates), would beneficially own in excess of 9.99 % of the Company's outstanding common stock (which
may be increased or decreased, with 61 days prior written notice by the holder). Although the April 2023 Pre-Funded Warrants have a tender
offer provision, the April 2023 Pre-Funded Warrants were determined to be equity-classified because they met the limited exception in
the case of a change-in-control. Because the April 2023 Pre-Funded Warrants are equity-classified, the placement agent fees and offering
expenses were accounted for as a reduction of additional paid in capital.

 The April 2023 Common Warrants
have an exercise price equal to $ 33.82 per share, were immediately exercisable upon the closing of the April 2023 Offering (the "Initial
Exercise Date") and are subject to customary anti-dilution adjustments for stock splits or dividends or other similar transactions.
The exercise price of the April 2023 Common Warrants will not be subject to adjustment as a result of subsequent equity issuances at effective
prices lower than the then-current exercise price. The April 2023 Common Warrants were originally exercisable for 5.5 years following
the Initial Exercise Date. The April 2023 Common Warrants are subject to a provision prohibiting the exercise of such April 2023 Common
Warrants to the extent that, after giving effect to such exercise, the holder of such April 2023 Common Warrants (together with the holder's
affiliates, and any other persons acting as a group together with the holder or any of the holder's affiliates), would beneficially
own in excess of 9.99 % of the Company's outstanding common stock (which may be increased or decreased, with 61 days prior written
notice by the holder). Although the April 2023 Common Warrants have a tender offer provision, the April 2023 Common Warrants were determined
to be equity-classified because they met the limited exception in the case of a change-in-control. Because the April 2023 Common Warrants
are equity-classified, the placement agent fees and offering expenses were accounted for as a reduction of additional paid in capital.

 During 2023, the Company entered
into a series of amendments to these warrants in August and November; such amendments changed the exercise price from $ 33.82 to $ 15.77
(see Second Amendment to Common Warrant Agreements for the July 2022, December 2022 and April 2023 Offerings section below), and
$ 3.23 (see Amendment to the August 2023 Offering section below), respectively. As of December 31, 2023, these warrants are not
exercisable until the Company obtains stockholder approval with respect to the 734,262 shares of common stock upon exercise of warrants
issued in connection with the Amendment to the August 2023 Offering (see Amendment to the August 2023 Offering section below),
at which point the December 2022 Common Warrants will remain exercisable until the fifth anniversary of the stockholder approval date.
The stockholder approval date occurred on February 16, 2024, as discussed under Note 13 – Subsequent Events.

 As of December 31, 2023, all 61,615 of the April 2023 Pre-Funded Warrants
have been exercised for a value of $ 117; and there are no unexercised April 2023 Pre-Funded Warrants remaining as of the end of 2023.
No April 2023 Common Warrants have been exercised as of December 31, 2023.

 Amendment to July and December 2022 Common

 On April 5, 2023, the Company
entered into an amendment to the common warrant agreements for the July 2022 and December 2022 Offerings, whereby warrants to purchase
up to 16,138 shares (with an original exercise price of $ 402.80 per share and an expiration date of January 20, 2028) and the warrants
to purchase up to 135,339 shares (with an original exercise price of $66.50 per share and an expiration date of June 22, 2028), respectively,
were amended to have an exercise price of $ 33.82 per share and an expiration date of October 10, 2028. The Company accounted for the amendment
as a warrant modification, whereby the effect of the modification is measured as the difference in its relative fair value immediately
before the modification and after the modification; and any increase to the relative fair value is recognized as an equity issuance cost.

 To assess for the change in
relative fair value, the Company performed a Black Scholes Option Model calculation to quantify the fair value of the common warrants
under their original terms as of the modification date using the following assumptions: a share price of $ 27.17, exercise prices of $ 402.80
and $ 66.50 for the July 2022 common warrants and December 2022 common warrants, respectively, an expected term of 4.8 and 5.2 years, respectively,
volatility of 106 %, a dividend rate of 0 % and a discount rate of 3.36 %. The Company then performed a Black Scholes Option Model calculation
to quantify the fair value of the common warrants with their new modified terms as of the modification date using the following assumptions:
a share price of $ 27.17, an exercise price of $ 33.82 for both the July 2022 common warrants and December 2022 common warrants, an expected
term of 5.5 years, volatility of 106 %, a dividend rate of 0 % and a discount rate of 3.36 %. The aggregate difference of approximately $ 0.8
million between the two calculated amounts was recorded as an equity issuance cost within equity during the period to account for the
change in relative fair value.

 F- 42

 First Amendment to the 2022 Omnibus Incentive
Plan

 At
the 2023 Annual Meeting of Stockholders of the Company held on July 6, 2023, the stockholders of the Company approved the First Amendment
("First Amendment") to the 180 Life Sciences Corp. 2022 Omnibus Incentive Plan (the 2022 Omnibus Incentive Plan, as amended
by the First Amendment, the "OIP"). The First Amendment was originally approved by the Board of Directors of the Company on
May 5, 2023, subject to stockholder approval and the First Amendment became effective at the time of stockholder approval. The First Amendment
increased the maximum number of shares available to be issued under the OIP from 6,315 shares to 24,736 shares.

 August 2023 Offering

 On August 9, 2023, the Company
entered into a Securities Purchase Agreement with an accredited investor, in addition to certain purchasers who relied on the Company's
registration statement filed with the SEC on July 25, 2023, which became effective on August 9, 2023, pursuant to which the Company agreed
to sell an aggregate of 35,102 shares of common stock (the "August Shares"), pre-funded warrants to purchase up to an aggregate
of 207,814 shares of common stock, and common stock warrants to purchase up to an aggregate of 242,915 shares of common stock ("August
Pre-funded Warrants") at a combined purchase price of $ 12.35 per share and warrant (the "August 2023 Offering"). Aggregate
gross proceeds from the August 2023 Offering were approximately $ 3.0 million, and the August 2023 Offering closed on August 14, 2023.

 The August 2023 Pre-Funded
Warrants have an exercise price equal to $ 0.0019, are immediately exercisable and are subject to customary anti-dilution adjustments for
stock splits or dividends or other similar transactions. The exercise price of the August 2023 Pre-Funded Warrants will not be subject
to adjustment as a result of subsequent equity issuances at effective prices lower than the then-current exercise price. The August 2023
Pre-Funded Warrants are exercisable until they are exercised in full. The August 2023 Pre-Funded Warrants are subject to a provision prohibiting
the exercise of such August 2023 Pre-Funded Warrants to the extent that, after giving effect to such exercise, the holder of such August
2023 Pre-Funded Warrants (together with the holder's affiliates, and any other persons acting as a group together with the holder
or any of the holder's affiliates), would beneficially own in excess of 9.99 % of the Company's outstanding common stock (which
may be increased or decreased, with 61 days prior written notice by the holder). Although the August 2023 Pre-Funded Warrants have a tender
offer provision, the August 2023 Pre-Funded Warrants were determined to be equity-classified because they met the limited exception in
the case of a change-in-control. Because the August 2023 Pre-Funded Warrants are equity-classified, the placement agent fees and offering
expenses were accounted for as a reduction of additional paid in capital.

 The August 2023 Common Warrants
have an exercise price equal to $ 12.35 per share, are immediately exercisable upon the closing of the August 2023 Offering and are subject
to customary anti-dilution adjustments for stock splits or dividends or other similar transactions. The exercise price of the August 2023
Common Warrants will not be subject to adjustment as a result of subsequent equity issuances at effective prices lower than the then-current
exercise price. The August 2023 Common Warrants were originally exercisable for 5 years following the initial exercise date of August
14, 2023. The August 2023 Common Warrants are subject to a provision prohibiting the exercise of such August 2023 Common Warrants to the
extent that, after giving effect to such exercise, the holder of such August 2023 Common Warrants (together with the holder's affiliates,
and any other persons acting as a group together with the holder or any of the holder's affiliates), would beneficially own in excess
of 4.99 % of the Company's outstanding common stock (which may be increased or decreased, with 61 days prior written notice by the
holder). Although the August 2023 Common Warrants have a tender offer provision, the August 2023 Common Warrants were determined to be
equity-classified because they met the limited exception in the case of a change-in-control. Because the August 2023 Common Warrants are
equity-classified, the placement agent fees and offering expenses were accounted for as a reduction of additional paid in capital.

 During 2023, the Company entered
into a series of amendments to these warrants in August and November; such amendments changed the exercise price from $ 12.35 to $ 3.23
(see Amendment to the August 2023 Offering section below). As of December 31, 2023, these warrants are not exercisable until the
Company obtains stockholder approval with respect to the 734,262 shares of common stock upon exercise of warrants issued in connection
with the Amendment to the August 2023 Offering (see Amendment to the August 2023 Offering section below), at which point the December
2022 Common Warrants will remain exercisable until the fifth anniversary of the stockholder approval date. The stockholder approval date
occurred on February 16, 2024, as discussed under Note 13 – Subsequent Events.

 As of December 31, 2023, all
of the August 2023 Pre-Funded Warrants have been exercised for a value of $ 395 and there are no unexercised August 2023 Pre-Funded Warrants
remaining as of the end of 2023. No August 2023 Common Warrants have been exercised as of December 31, 2023.

 F- 43

 Second Amendment to Common Warrant Agreements
for the July 2022, December 2022 and April 2023 Offerings

 On August 9, 2023, the Company
entered into an amendment to the common warrant agreements for the July 2022, December 2022 and April 2023 Offerings, whereby common warrants
to purchase up to 16,138, 135,339 and 82,668 shares, respectively (all with previous exercise prices of $ 33.82 per share), were amended
to have an exercise price of $ 15.77 per share. The Company accounted for the amendment as a warrant modification, whereby the effect of
the modification is measured as the difference in its relative fair value immediately before the modification and after the modification;
and any increase to the relative fair value is recognized as an equity issuance cost.

 To
assess for the change in relative fair value, the Company performed a Black Scholes Option Model calculation to quantify the fair value
of the common warrants under their original terms as of the modification date using the following assumptions for the July 2022, December
2022 and April 2023 common warrants: a share price of $ 16.04, an exercise price of $ 33.82, an expected term of 5.18 years, volatility
of 100 %, a dividend rate of 0 % and a discount rate of 4.12 %. The Company then performed a Black Scholes Option Model calculation to quantify
the fair value of the common warrants with their new modified terms as of the modification date using the following assumptions for the
July 2022, December 2022 and April 2023 common warrants: a share price of $ 16.04, an exercise price of $ 15.77, an expected term of 5.18
years, volatility of 100 %, a dividend rate of 0 % and a discount rate of 4.12 %. The aggregate difference of approximately $ 1.4 million
between the two calculated amounts was recorded as an equity issuance cost within equity during the period to account for the change
in relative fair value.

 Amendment to August 2023 Offering

 On November 28, 2023, the
Company entered into an amendment to the August 2023 Offering ("Amendment to the August 2023 Offering"), whereby (i) the Purchaser
agreed to pay an additional $ 830,769 in connection with the repricing of the August Shares and August Pre-Funded Warrants (the "Repricing
Amount"), (ii) the Company agreed to issue to the Purchaser additional pre-funded warrants to purchase up to 257,205 shares of common
stock, with an exercise price of $ 0.0019 per share (the "Additional Pre- Funded Warrants"), and warrants to purchase up to
 477,058 shares of common stock, with an exercise price of $ 3.23 per share (the "Additional Common Warrants", collectively
the "Additional Warrants"), and (iii) the Company and the Purchaser agreed to enter into the warrant amendment agreement (as
defined and described below).

 Other than exercise price
and exercisability, the Additional Warrants have the same terms and conditions as the August 2023 Pre-funded Warrants and the August 2023
Common Warrants and, as such, were determined to be equity-classified because they met the limited exception in the case of a change-in-control.
Because the Additional Warrants are equity-classified, the placement agent fees and offering expenses will be accounted for as a reduction
of additional paid in capital. The Additional Warrants will not be exercisable until the Company obtains stockholder approval with respect
to the issuance of the 734,262 shares of common stock upon exercise of the warrants, at which point the Additional Pre-Funded Warrants
will remain exercisable until all the Additional Pre-Funded Warrants are exercised in full, and the Additional Common Warrants will remain
exercisable until the fifth anniversary of the stockholder approval date. The stockholder approval date occurred on February 16, 2024,
as discussed under Note 13 – Subsequent Events.

 In accordance with the Amendment
to the August 2023 Offering, the Company entered into a warrant amendment agreement to amend the following outstanding warrants held by
the Purchaser: (i) warrants to purchase up to 16,138 shares of common stock issued in July 2022; (ii) warrants to purchase up to 135,339
shares of common stock issued in December 2022; (iii) warrants to purchase up to 82,668 shares of common stock issued in April 2023; and
(iv) warrants to purchase up to 242,915 shares of common stock issued in August 2023 (collectively, the "Existing Common Warrants").
Pursuant to the warrant amendment agreement, the Existing Common Warrants will not be exercisable until the Company obtains stockholder
approval for the issuance of up to 477,058 shares of common stock upon exercise of the Existing Common Warrants. The Existing Common Warrants
will have an exercise price equal to $ 3.23 per share, and the Existing Common Warrants will expire on the fifth anniversary of the stockholder
approval date. The stockholder approval date occurred on February 16, 2024, as discussed under Note 13 – Subsequent Events.

 The Company accounted for
the Amendment to the August 2023 Offering as a warrant modification, whereby the effect of the modification is measured as the difference
in its relative fair value immediately before the modification and after the modification; and any increase to the relative fair value
is recognized as an equity issuance cost.

 F- 44

 To assess for the change in
relative fair value, the Company performed a Black Scholes Option Model calculation to quantify the fair value of the common warrants
under their original terms as of the modification date using the following assumptions for the July 2022, December 2022, April 2023 and
August 2023 common warrants: a share price of $ 6.46, an exercise price of $ 15.77 for the July 2022, December 2022 and April 2023 common
warrants and an exercise price of $ 12.35 for the August 2023 common warrants, an expected term of 5.22 years, volatility of 100 %, a dividend
rate of 0 % and a discount rate of 4.29 %. The Company then performed a Black Scholes Option Model calculation to quantify the fair value
of the common warrants with their new modified terms as of the modification date using the following assumptions for the July 2022, December
2022, April 2023 and August 2023 common warrants: a share price of $ 6.46, an exercise price of $ 3.23, an expected term of 5.22 years,
volatility of 100 %, a dividend rate of 0 % and a discount rate of 4.29 %. The aggregate difference of approximately $ 3.1 million between
the two calculated amounts was recorded as an equity issuance cost within equity during the period to account for the change in relative
fair value.

 As of the filing of this Report,
all of the additional 257,205 pre-funded warrants issued in connection with the amendment to the August 2023 Offering have been exercised
for a value of $ 489, and there are no additional pre-funded warrants remaining (see Note 13 – Subsequent Events, Pre-funded Warrant
Exercises for further details). No additional common warrants have been exercised.

 Common Stock Issued for Services during 2023
and 2022

31, 2023, the Company issued an aggregate of 11,889 of immediately vested shares of the Company's common stock as compensation to
consultants, directors, and officers, with an aggregate issuance date fair value of $ 89,189, which was charged immediately to the consolidated
statement of operations for the year ended December 31, 2023.

 During
the year ended December 31, 2022, the Company issued an aggregate of 739 of immediately vested shares of the Company's common stock
as compensation to consultants, directors, and officers, with an aggregate issuance date fair value of $ 331,591, which was charged immediately
to the consolidated statement of operations for the year ended December 31, 2022.

 Restricted Stock Shares Issued during 2023
and 2022

 During
the year ended December 31, 2022, the Company issued 32 restricted shares of the Company's common stock, or Restricted Stock Shares
as compensation to consultants with an issuance date fair value $ 48,600, or $ 1,539.00 per share. Per the two-year consulting agreement,
the Restricted Stock Shares are issued at the beginning of the contract term and annually and vest monthly over a period of 24 months.
The Company recognized stock-based compensation expense related to the amortization of the Restricted Stock Shares of $ 17,820 and $ 26,325
for the years ended December 31, 2023 and 2022. There is no more unrecognized stock-based compensation related to these shares as of
the end of the period.

 Below is a table summarizing
the Restricted Stock Shares granted and outstanding as of and for the year ended December 31, 2023:

 Unvested
 Restricted

 Grant
 Date

 Stock

 FV Price

 Unvested as of January 1, 2022

 -

 $
 -

 Granted

 Vested

 ( 17
)

 Forfeited

 -

 -

 Unvested as of December 31, 2022

 Granted

 -

 -

 Vested

 ( 12
)

 Forfeited

 ( 3
)

 Unvested as of December 31, 2023

 -

 Special Voting Shares

 The Special Voting Shares
were issued to the former shareholders of CBR Pharma and Katexco in connection with the reorganization of 180 prior to the Business Combination.
The Special Voting Shares are exchangeable by the holder for shares of the Company's common stock and vote together as a single
class with the Company's common stockholders. Special Voting Shares are not entitled to receive any dividend of distributions.

 During the years ended December
31, 2023 and 2022, no shares were issued upon the exchange of common stock equivalents associated with the Special Voting Shares, and
the balance was 14 shares as of each date.

 F- 45

 Stock Options

 A summary of the option activity
during the years ended December 31, 2023 and 2022 is present below:

 Options

 Exercise
 Price

 Remaining
 Term
 (in Years)

 Intrinsic
 Value

 Outstanding, January 1, 2022

 7,201

 $
 1,814.31

 9.41

 3,525

 Granted

 1,360

 516.80

 -

 -

 Outstanding, December 31, 2022

 8,561

 1,607.97

 8.6

 -

 Granted

 14,193

 12.73

 9.0

 -

 Forfeited

 ( 4,966
)

 -

 -

 -

 Outstanding, December 31, 2023

 17,788

 $
 633.95

 9.0

 $
 -

 Exercisable, December 31, 2023

 12,211

 $
 851.37

 8.7

 $
 -

 A summary of outstanding and
exercisable stock options as of December 31, 2023 is presented below:

 Stock Options Outstanding

 Stock Options Exercisable

 Exercise

 Remaining

 Price

 Life in Years

 $
 946.20

 6.9

 $
 1,683.40

 4,157

 7.2

 3,959

 $
 2,872.80

 7.6

 $
 1,501.00

 8.0

 $
 516.80

 1,208

 8.6

 $
 12.73

 10,641

 9.9

 5,894

 17,788

 8.7

 12,211

 The assumptions listed below
for 2023 and 2022 were derived using i) the risk free interest rate published by the federal reserve on the date of grant, ii) the expected
term used is the average of the contractual term plus the weighted average vesting term, iii) the volatility was derived using rates from
third-party valuation reports of other financial instruments for the applicable quarter and iv) the expected dividends rate used is taken
from the applicable option award agreement.

 F- 46

 On May 19, 2022, the Company
granted ten-year options for the purchase of an aggregate of 298 shares of common stock at an exercise price of $ 516.80 per share to six
officers of the Company, pursuant to the 2022 Omnibus Incentive Plan. The options had an aggregate grant date value of $ 115,936.

 On May 19, 2022, the Company
also granted ten-year options for the purchase of 352 shares and 710 shares of common stock at an exercise price of $ 516.80 per share
to two individuals (one a director and the other, a consultant), respectively, pursuant to the 2022 Omnibus Incentive Plan; the 352 shares
had a grant date value of $ 130,000 and vested immediately, while the 710 shares had a grant date value of $ 261,704 and vest depending
on the achievement of certain milestones.

 The assumptions used in the
Black-Scholes valuation method for these options which were issued in 2022 were as follows:

 Risk free interest rate

 2.88
 %

 Expected term (years)

 5.00 – 5.77

 91.0
 %

 %

 On September 4, 2023, the
Company granted ten-year options for the purchase of an aggregate of 6,312 shares of common stock at an exercise price of $ 12.73 per share
to independent members of the Board of Directors and the Executive Chairman, pursuant to the 2022 Omnibus Incentive Plan. The options
have an aggregate grant date value of $ 62,440 and vest at a rate of one twelfth monthly over a period of one year, beginning on September
30, 2023.

 On September 4, 2023, the
Company also granted ten-year options for the purchase of an aggregate of 5,525 shares of common stock at an exercise price of $ 12.73
per share to three officers of the Company, pursuant to the 2022 Omnibus Incentive Plan. The options have an aggregate grant date fair
value of $ 54,635 and vest at a rate of one twelfth monthly over a period of one year, beginning on September 30, 2023.

 On September 4, 2023, the
Company also granted ten-year options for the purchase 2,356 shares of common stock at an exercise price of $ 12.73 per share to the Lead
Director of the Company, pursuant to the 2022 Omnibus Incentive Plan. The options had an aggregate grant date fair value of $ 22,928 and
vested immediately upon grant.

 The assumptions used in the
Black-Scholes valuation method for these options which were issued in 2023 were as follows:

 Risk free interest rate

 4.18
 %

 Expected term (years)

 5.00 – 5.27

 100.0
 %

 %

 The Company recognized stock-based
compensation expense of $ 2,176,314 and $ 2,607,501 for the years ended December 31, 2023 and 2022, respectively, related to the amortization
of stock options. The expense is included within general and administrative expenses or research and development expenses on the consolidated
statements of operations. As of December 31, 2023, there was $ 491,363 of unrecognized stock-based compensation expense that will be recognized
over the weighted average remaining vesting period of 1.05 years.

 F- 47

 NASDAQ Compliance

 Notification of Failure to Comply with Nasdaq Listing Rule 5550(a)(2)

 On September 7, 2023, the
Company received written notice from the Listing Qualifications Department of The Nasdaq Stock Market LLC (" Nasdaq ") notifying
the Company that it is not in compliance with the minimum bid price requirements set forth in Nasdaq Listing Rule 5550(a)(2) for
continued listing on The Nasdaq Capital Market. Nasdaq Listing Rule 5550(a)(2) requires listed securities to maintain a minimum bid
price of $ 1.00 per share, and Listing Rule 5810(c)(3)(A) provides that a failure to meet the minimum bid price requirement exists
if the deficiency continues for a period of thirty (30) consecutive business days. Based on the closing bid price of the Company's
common stock for the thirty (30) consecutive business days from July 26, 2023 to September 6, 2023, the Company no longer meets the
minimum bid price requirement.

 The notification letter stated
that the Company has 180 calendar days or until March 5, 2024, to regain compliance with Nasdaq Listing Rule 5550(a)(2). To regain compliance,
the bid price of the Company's common stock must have a closing bid price of at least $ 1.00 per share for a minimum of 10 consecutive
business days. If the Company does not regain compliance by March 5, 2024, an additional 180 days may be granted to regain compliance,
so long as the Company meets The Nasdaq Capital Market initial listing criteria (except for the bid price requirement) and notifies
Nasdaq in writing of its intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary.
If the Company does not qualify for the second compliance period or fails to regain compliance during the second 180-day period, the Company's
common stock will be subject to delisting, at which point the Company would have an opportunity to appeal the delisting determination
to a Hearings Panel.

 The Company held a special
stockholders' meeting on February 16, 2024, and received approval, for among other things, an amendment to our Second Amended and
Restated Certificate of Incorporation, as amended, to effect a reverse stock split of our issued and outstanding shares of our common
stock, by a ratio of between one-for-four to one-for-forty, inclusive, with the exact ratio to be set at a whole number to be determined
by our Board of Directors or a duly authorized committee thereof in its discretion, at any time after approval of the amendment and prior
to February 16, 2025. The Board of Directors subsequently approved a 1-for-19 reverse stock split of the outstanding common stock on February
16, 2024, and the reverse split became effective on February 28, 2024, as discussed in greater detail below under Note 13 – Subsequent
Events.

 Notification of Failure to Comply with Nasdaq Listing Rule 5635(d)

 On October 11, 2023, the Company
received written notice from the Listing Qualifications Department of Nasdaq, notifying the Company that it was not in compliance with
the shareholder approval requirements set forth in Nasdaq Listing Rule 5635(d), which requires prior shareholder approval for transactions,
other than public offerings, involving the issuance of 20 % or more of the pre-transaction shares outstanding at less than the applicable
Minimum Price (as defined in Listing Rule 5635(d)(1)(A)).

 The Staff's determination
under Listing Rule 5635(d) related to the offering and issuance by the Company of an aggregate of: (i) 35,102 shares of the Company's
common stock, $ 0.0001 par value (the "Shares"), at a price of $ 12.35 per share, (ii) pre-funded warrants (the "Pre-Funded
Warrants") to purchase up to 207,814 shares of common stock, at a price of $ 12.3481 per Pre-Funded Warrant and (iii) warrants (the
"Common Warrants") to purchase up to 242,915 shares of Common Stock. The offering price per Share and associated Common Warrant
was $ 12.35 and the offering price per Pre-Funded Warrant and associated Common Warrant was $ 12.3481.

 The October 11, 2023 written
notice from the Listing Qualifications Department of Nasdaq provided the Company 45 days to submit a plan to regain compliance. The plan
of compliance was subsequently submitted by the Company to Nasdaq on November 9, 2023, and on November 14, 2023, Nasdaq granted the Company
an extension, until December 15, 2023, to complete certain transactions set forth in the plan of compliance, in order to remedy its prior
violation of Nasdaq rules as described in the October 11, 2023 letter from Nasdaq.

 As disclosed in greater detail
above, on November 29, 2023, the Company undertook several transactions, including amending the terms of the Common Warrants to not be
exercisable until the Company's stockholders approve such issuance in accordance with the Nasdaq Listing Rules, in order to regain
compliance with Listing Rule 5635(d)(1)(A)).

 As a result of those transactions,
on December 14, 2023, Nasdaq provided the Company written notice that the Company has fulfilled the terms of the prior extension; is in
compliance with Listing Rule 5635(d)(1)(A)); and that the matter is now closed.

 Notification of Failure to Comply with Nasdaq
Listing Rule 5550(b)(1)

 On November 15, 2023, the
Company received a letter from Nasdaq notifying the Company that its stockholders' equity as reported in its Quarterly Report on
Form 10-Q for the period ending September 30, 2023 (the "Form 10-Q"), did not meet the minimum stockholders' equity
requirement for continued listing on the Nasdaq Capital Market. Nasdaq Listing Rule 5550(b)(1) requires companies listed on the Nasdaq
Capital Market to maintain stockholders' equity of at least $ 2,500,000. In the Company's Form 10-Q, the Company reported a
stockholders' deficit of ($ 149,327), which is below the minimum stockholders' equity required for continued listing pursuant
to Nasdaq Listing Rule 5550(b)(1). Additionally, as of the date of this Report, the Company does not meet the alternative Nasdaq continued
listing standards under Nasdaq Listing Rules.

 F- 48

 This notice of noncompliance
has had no immediate impact on the continued listing or trading of the Company's common stock on The Nasdaq Capital Market, which
will continue to be listed and traded on Nasdaq, subject to the Company's compliance with the other continued listing requirements.
Nasdaq has given the Company until January 2, 2024 to submit to Nasdaq a plan to regain compliance. We submitted the plan to regain compliance
in a timely manner, and on January 11, 2024, Nasdaq advised the Company that it has determined to grant the Company an extension to regain
compliance with the Rule. See Note 13 – Subsequent Events.

 NOTE 11 - INCOME TAXES

 The Company is subject to
federal and state/provincial income taxes in the United States, Canada, and the United Kingdom and each legal entity files on a non- consolidated
basis. The benefit of the pre-reorganization net operating losses of 180 LP were passed through to its owners.

 The losses before income taxes
consist of the following domestic and international components:

 2023

 2022

 Domestic

 $
 ( 20,025,289
)

 $
 ( 37,727,021
)

 International

 ( 2,259,237
)

 ( 1,941,987
)

 $
 ( 22,284,526
)

 $
 ( 39,669,008
)

 The provision for income taxes consists of the
following benefits:

 2023

 2022

 Deferred tax benefits:

 Domestic:

 Federal

 $
 4,004,891

 $
 4,057,936

 State

 1,399,496

 1,343,123

 International

 591,583

 353,038

 5,995,970

 5,754,097

 Change in valuation allowance

 ( 3,646,556
)

 ( 4,811,348
)

 Net income tax benefit

 $
 2,349,414

 $
 942,749

 F- 49

 Certain deferred tax assets
are denominated in currencies other than the US dollar and are subject to foreign currency translation adjustments. The provision for
income taxes differs from the United States Federal statutory rate as follows:

 2023

 2022

 US Federal statutory rate

 21.0
 %

 21.0
 %

 Difference between domestic and foreign federal rates

 ( 0.2
)%

 ( 0.1
)%

 State and provincial taxes, net of federal benefits

 6.3
 %

 6.6
 %

 Permanent differences:

 Goodwill impairment

 -

 ( 23.7
)%

 Change in the fair value of derivatives and accrued issuable equity

 0.4
 %

 10.7
 %

 Other

 ( 0.5
)%

 -

 Change in valuation allowance

 ( 16.4
)%

 ( 12.1
)%

 Effective income tax rate

 10.6
 %

 2.4
 %

 Deferred tax assets and liabilities
consist of the following:

 2023

 2022

 Deferred tax assets:

 Net operating loss carryforwards

 $
 16,460,534

 $
 13,399,384

 Amortization

 318,546

 165,476

 Accrued compensation not currently deductible

 75,638

 343,787

 Stock compensation

 2,126,581

 1,588,866

 Accrued interest

 150,502

 150,502

 Reserve for uncollectible notes receivable

 162,770

 -

 Organizational costs deferred for tax purposes

 8,125

 8,125

 19,302,696

 15,656,140

 Deferred tax liabilities:

 Difference between book and tax basis related to:

 Technology license

 ( 351,791
)

 ( 368,587
)

 Acquired in-process research and development

 -

 ( 2,332,618
)

 Other

 ( 639,726
)

 ( 555,880
)

 ( 991,517
)

 ( 3,257,085
)

 Total of deferred tax assets and liabilities

 18,311,179

 12,399,055

 Valuation allowance

 ( 18,662,970
)

 ( 15,016,414
)

 Total of deferred tax assets and liabilities, net

 $
 ( 351,791
)

 $
 ( 2,617,359
)

 F- 50

 The change in the valuation
reserve for deferred tax assets consists of the following:

 2023

 2022

 Beginning of period

 $
 ( 15,016,414
)

 $
 ( 9,072,118
)

 Change in valuation pursuant to the tax provision

 ( 3,732,408
)

 ( 4,811,348
)

 True-up to a prior year's tax return

 85,851

 ( 1,132,948
)

 End of period

 $
 ( 18,662,971
)

 $
 ( 15,016,414
)

 As of December 31, 2023, the
Company had net operating loss ("NOL") carryforwards that may be available to offset future taxable income in various jurisdictions
as follows:

 Approximately $ 41,870,000 of domestic federal and state NOLs. The federal NOLs have no expiration date and are subject to 80 % of taxable income; the state NOLs will begin to expire in 2039;

 Approximately
$ 8,589,000 each of Canadian federal and provincial NOLs. Those NOLs will begin to expire in 2038; and

 Approximately
$ 12,759,000 of United Kingdom federal NOLs. Those NOLs have no expiration date.

 The utilization of the domestic
NOLs to offset future taxable income may be subject to annual limitations under Section 382 of the Internal Revenue Code and similar state
statutes as a result of ownership changes.

 The
Company has assessed the likelihood that deferred tax assets will be realized in accordance with the provisions of ASC 740. ASC 740 requires
that such review considers all available positive and negative evidence, including the scheduled reversal of deferred tax assets, projected
future taxable income, and tax planning strategies. ASC 740 requires that a valuation allowance be established when it is "more
likely than not" that all, or a portion of, deferred tax assets will not be realized. After the performance of such reviews as
of December 31, 2023 and 2022, management believes that uncertainty exists with respect to future realization of its deferred tax assets
and has, therefore, established a full valuation allowance. The Company recorded increases in the valuation allowance of $ 3,646,557 and
$ 5,944,246 in connection with the tax provisions for the years ended December 31, 2023 and 2022, respectively.

 Management has evaluated and
concluded that there were no material uncertain tax positions requiring recognition in the Company's consolidated financial statements
as of December 31, 2023 and 2022. The Company does not expect any significant changes in its unrecognized tax benefits within twelve months
of the reporting date.

 No tax audits were commenced
or were in process during the years ended December 31, 2023 and 2022, nor were any tax related interest or penalties incurred during those
periods. The Company's tax returns filed in the United States, Canada, and the United Kingdom since inception remain subject to
examination.

 NOTE 12 - RELATED PARTIES

 Accounts Payable – Related Parties

 Accounts payable - related
parties were $ 266,009 and $0 as of December 31, 2023 and 2022, respectively, and consist of amounts due to certain officers and directors
of the Company, as well as deferred compensation for certain executives. For the accounts payable – related party balance as of
December 31, 2023, approximately $ 210,000 relates to income taxes payable to the U.K. government for the salary of Prof. Sir Marc Feldmann,
who serves as the Chairman, CEO and Executive Director of CannBioRex.

 Accrued Expenses - Related Parties

 Accrued expenses - related
parties were $0 and $ 188,159 as of December 31, 2023 and 2022, respectively, and consist of interest accrued on loans and convertible
notes due to certain officers and directors of the Company, as well as deferred compensation for certain executives.

 F- 51

 Research and Development Expenses - Related
Parties

 Research and Development Expenses
– Related Parties of $ 480,777 and $ 240,731 during the years ended December 31, 2023 and 2022, respectively, is related to consulting
and professional fees paid to current or former officers, directors or greater than 10 % investors, or affiliates thereof.

 General and Administrative Expenses - Related
Parties

 General and Administrative
Expenses – Related Parties during the years ended December 31, 2023 and 2022, were $ 46,555 and $ 5,612, respectively. Of the expenses
incurred during 2023 and 2022, these primarily relate to professional fees paid to current or former officers, directors or greater than
 10 % investors, or affiliates thereof.

 Interest Income - Related Parties

 During the years ended December
31, 2023 and 2022, the Company recorded $0 and $ 1,508, respectively, of interest income – related parties, which related to interest
income on loans with officers and directors of the Company.

 NOTE 13 - SUBSEQUENT EVENTS

 The Company has evaluated
events and transactions subsequent to December 31, 2023, through the date the financial statements were issued. Except for the following,
there are no subsequent events identified that would require disclosure in the financial statements.

 Amendments to Compensation Agreements

 On January 10, 2024, and effective
on January 1, 2024, the Company entered into (a) a Fourth Amendment to Amended and Restated Employment Agreement with Dr. Woody, the CEO
and Director of the Company; (b) a Fourth Amendment to Employment Agreement with Dr. Rothbard, the Chief Science Officer (CSO) of the
Company; (c) a Third Amendment to Consulting Agreement with Dr. Steinman, the Executive Chairman of the Company; and (d) a Second Amendment
to Consulting Agreement with Prof. Sir Feldmann, the former Executive Co-Chairman of the Company (collectively, the "Amendments"),
which each amended the compensation agreements then in place with such individuals (see Note 9 – Commitments and Contingencies).

 Pursuant to the Amendments,
each of Dr. Woody and Dr. Rothbard, effective as of January 1, 2024, agreed to a reduction of the base salaries set forth in their respective
amended employment agreements, by 50 %, to $ 245,000 per year for Dr. Woody and to $ 100,000 per year for Dr. Rothbard, with the amount of
such salary reductions ($ 20,416 per month for Dr. Woody and $ 8,333 per month for Dr. Rothbard), accruing monthly in arrears, to be paid
upon the Company raising at least $5,000,000 in funding subsequent to the date of the Amendments (the "Funding Date"), provided
that in the event the Funding Date does not occur prior to March 15, 2025, the amounts accrued will be forgiven in their entirety.

 Also pursuant to the Amendments,
each of Dr. Steinman and Sir Feldmann, effective as of January 1, 2024, agreed to a reduction of the base salaries set forth in their
respective consulting agreements, by 100 %, to $ 0 per year for each of Dr. Steinman and Sir Feldmann, with the amount of such salary reductions
($ 18,750 per month or $ 225,000 per year, for Dr. Steinman and 14,167 per month or 170,000 per year, for Sir Feldmann), accruing
monthly in arrears, to be paid on the Funding Date, provided that in the event the Funding Date does not occur prior to March 15, 2025,
the amounts accrued will be forgiven in their entirety.

 Granting of Extension to Regain Nasdaq Compliance

 As previously disclosed
in Note 10 – Stockholders' (Deficit) Equity, the Company received a letter from Nasdaq notifying the Company that it was
not in compliance with the minimum stockholders' equity requirement for continued listing on the Nasdaq Capital Market. Nasdaq
Listing Rule 5550(b)(1) (the "Rule") requires companies listed on the Nasdaq Capital Market to maintain
stockholders' equity of at least $ 2,500,000. On January 11, 2024, Nasdaq advised the Company that it had determined to grant
the Company an extension to regain compliance with the Rule.

 The terms of the extension are as follows: on or
before May 13, 2024, the Company must complete certain transactions described in greater detail in the compliance plan, contemplated to
result in the Company increasing its stockholders' equity to more than $ 2.5 million, and opt for one of the two alternatives to
evidence compliance with the Rule. Additionally, in either case the Company is required to disclose that Nasdaq will continue to monitor
the Company's ongoing compliance with the stockholders' equity requirement and, if at the time of its next periodic report
the Company does not evidence compliance, that it may be subject to delisting. Regardless of which alternative the Company chooses, if
the Company fails to evidence compliance upon filing its next periodic report with the SEC following the end of such compliance period
(i.e., its Quarterly Report for the Quarter ended June 30, 2024), the Company may be subject to delisting.

 F- 52

 Reversal of Accrued Bonuses

 For the year ended December
31, 2023, the Company had a balance of $ 1,053,006 in accrued bonuses due to the Board of Directors for services rendered during the fiscal
years 2023 and 2022; of this amount, approximately $ 590,000 and $ 460,000 relate to services rendered during the current and prior years,
respectively. On January 29, 2024, it was determined during a board meeting that the Company would not be paying these bonuses and would
not be awarding any bonuses during 2024; and as a result, the Company subsequently determined that this event should be recognized in
the financial statements for the year ended December 31, 2023 and recorded an entry to reverse the accrued balances. This reversal is
reflected in the financial statements for the year ended December 31, 2023.

 D&O Insurance Lawsuit

 On February 12, 2024, the
judge in the Company's pending lawsuit in the U.S. District Court Northern District of California, San Jose Division, granted
a Motion for Partial Summary Judgment against AmTrust International Underwriters DAC (" AmTrust "), which was the premerger
directors' and officers' insurance policy underwriter for the Company and the Company's excess insurance carrier, Freedom
Specialty Insurance Company (" Freedom "), and ordered as follows:

 (a)
 AmTrust is obligated under its insurance policy with the
Company to advance to the Company all defense costs in excess of the deductible that the Company has advanced or will advance to Dr.
Marlene Krauss, the Company's former Chief Executive Officer and Director, and George Hornig, the former Chairman of the Board
of Directors, in connection with certain subpoenas issued by the Securities and Exchange Commission; and

 (b)
 upon exhaustion of the AmTrust insurance policy, Freedom
is obligated to do the same pursuant to its excess liability insurance policy with the Company.

 This Order applies until the
final disposition of the case, but does not constitute a final judgment, and both the Company and the two insurers retain their rights
to contest all applicable issues at trial, which is scheduled for May 12, 2025.

 It is unclear whether the
defendants will take steps to appeal this order, the outcome of any such appeal, the timing of our receipt of any funds we may receive
pursuant to the order related to reimbursement of amounts related to the Securities and Commission subpoenas, if any, or such amounts
that we may ultimately receive.

 A final judgment following
trial could potentially confirm these obligations of the insurers or, alternatively, reverse and require the Company to repay all or certain
portions of such advance payments. There is no assurance at this time as to what the final judgment may entail.

 Second Amendment to the 2022 Omnibus Incentive
Plan

 On February 16, 2024, the
Company held a special meeting of its stockholders as of December 18, 2023 and approved the adoption of the Second Amendment to the 180
Life Sciences Corp. 2022 Omnibus Incentive Plan. Such amendment increased the maximum number of shares available to be issued under the
Plan from 470,000 shares to 4,249,933 shares.

 Special Stockholder's Meeting/Reverse
Stock Split

 On February 16, 2024, the
Company held a special meeting of its stockholders as of December 18, 2023 to vote on three proposals: i) approval of an amendment to
the Second Amended and Restated Certificate of Incorporation to effect a reverse stock split of the issued and outstanding shares of common
stock, par value $ 0.0001 per share, by a ratio of between one-for-four to one-for-forty, inclusive, with the exact ratio to be set at
a whole number to be determined by the board of directors, ii) approval of the adoption of the Second Amendment to the 180 Life Sciences
Corp. 2022 Omnibus Incentive Plan and iii) approval of the issuance of shares of common stock, $ 0.0001 par value per share, in excess
of 19.99 % of the issued and outstanding shares of common stock, upon the exercise of pre-funded warrants to purchase up to 257,205 shares
of common stock, with an exercise price of $ 0.0019 per share; and warrants to purchase up to 954,116 shares of common stock, with an exercise
price of $ 3.23 per share, at a price less than the minimum price as defined by and in accordance with Nasdaq Listing Rule 5635(d). All
proposals were approved.

 On February 16, 2024, the
Company's board of directors approved a reverse split ratio of one-for-nineteen, with any fractional shares remaining after the
reverse split to be rounded up to the nearest whole share. The Company believes the split is necessary to maintain the listing of the
Company's common stock on the Nasdaq Capital Market, and to cure the Company's current non-compliance with Nasdaq Capital
Market listing rules; the board also believes that the reverse split will also improve the marketability and liquidity of the common stock.

 On February 26, 2024, the
Company filed a Certificate of Amendment to our Second Amended and Restated Certificate of Incorporation, as amended (the "Certificate
of Amendment") with the Secretary of State of the State of Delaware to effect the reverse stock split. Pursuant to the Certificate
of Amendment, the reverse stock split was effective on February 28, 2024 at 12:01 a.m. Eastern Time (the "Effective Time").
The shares of the Company's common stock began trading on the Nasdaq Capital Market ("Nasdaq") on a post-split basis
on February 28, 2024, with new CUSIP number: 68236V302. No change was made to the trading symbol for the Company's shares of common
stock or public warrants, "ATNF" and "ATNFW", respectively, in connection with the reverse stock split.

 F- 53

 New Board Members Appointed

 On February 28, 2024, the
Company's Board of Directors appointed Blair Jordan as a member of the Board, and on March 7, 2024, the Company's Board of
Directors appointed Omar Jimenez and Ryan L. Smith as members of the Board. At the same time, the Board set the number of members of the
Board at five members. The Board determined that Mr. Jordan, Mr. Jimenez and Mr. Smith were each independent and not party to any material
plan, contract or arrangement (whether or not written) with the Company. In connection with their appointments to the Board and on February
24, 2024, March 4, 2024 and March 5, 2024, to be effective upon their appointments to the Board, the Company entered into an agreement
with Mr. Jordan, Mr. Jimenez and Mr. Smith, respectively, whereby each will be paid $ 40,000 per year as an annual retainer fee for serving
on the Board, and $ 10,000 per year for serving as the Chairman of the Strategic and Alternatives Committee and $ 15,000 per year for serving
as the Lead Director (Mr. Jordan); $ 10,000 per year for serving as Chairman of the Audit Committee (Mr. Jimenez); and $ 10,000 per year
for serving as the Chairman of the Compensation Committee and the Nominating and Corporate Governance
Committee (Mr. Smith). The Company agreed to make an initial fee payment of $ 7,500 to Mr. Jordan in connection with his appointment
to the Board, and subsequent fee payments quarterly in arrears, and pro-rated for partial quarters. A total of one half of such aggregate
cash compensation will be accrued until such time as the Company raises an aggregate of $ 1 million from any source, including but not
limited to debt and/or equity raises, quasi-equity raises, receipt of insurance proceeds, litigation proceeds, and corporate transactions.

 Resignation
of Board Member

 On
March 7, 2024, Sir Marc Feldmann, Ph. D. provided notice to the Board of Directors of his resignation as a member of the Board of Directors,
effective on the same date. Sir Feldmann's resignation was not the result of any disagreement with the Company relating to the Company's
operations, policies or practices, or otherwise. Prior to his resignation, Sir Feldmann served as Co-Executive Chairman of the Company
but did not serve on any committees of the Board of Directors. Sir Feldmann will continue to serve as an employee of one of the Company's
subsidiaries.

 Pre-Funded Warrant Exercises

 During February and
March 2024, the remaining additional pre-funded warrants from the Amendment to the August 2023 Offering were exercised at a price of
$ 0.0019 per share and, as a result, the holder was issued 257,205 shares of common stock (see Note 10 – Stockholder's
(Deficit) Equity, August 2023 Offering for further details).

 Nasdaq Compliance with Listing Rule 5550(a)(2)
Regained

 On September 7, 2023, Nasdaq staff notified the Company that its common
stock failed to maintain a minimum bid price of $ 1.00 over the previous 30 consecutive business days as required by the Listing Rules
of The Nasdaq Stock Market. Since then, the staff has determined that for the last 10 consecutive business days, from February 28 to March
12, 2024, the closing bid price of the Company's common stock has been at $ 1.00 per share or greater. Accordingly, the Company has
regained compliance with Listing Rule 5550(a)(2) and this matter is now closed.

 Conversion of Class K Special Voting Shares

 On March 12, 2024, a holder of Class K Special Voting Shares converted
such shares into 14 shares of common stock of the Company in a transaction exempt from registration pursuant to Section 3(a)(9) of the
Securities Act. As a result of such conversion, there are no longer any Class K Special Voting Shares.

 387.18 52.59

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 2022-07-01
 2022-07-17

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 2022-07-01
 2022-07-17

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 2023-04-30
 2023-04-30

 atnf: DecemberTwoThousandTwentyTwoOfferingMember

 2023-04-01
 2023-04-05

 2023-04-01
 2023-04-05

 2023-04-01
 2023-04-05

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 2023-01-05

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 2023-01-05

 2023-01-05

 atnf: WarrantPriceMember

 2023-01-05

 2023-08-09

 2023-08-09

 2023-08-09
 2023-08-09

 2023-04-30

 atnf:warrantsMember

 us-gaap: RestrictedStockMember

 srt: DirectorMember

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 2023-09-07

 2023-10-13
 2023-10-13

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 2023-11-15
 2023-11-15

 2023-11-15

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 atnf: SirFeldmannMember

 2023-09-30

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 srt: BoardOfDirectorsChairmanMember

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 srt: DirectorMember

 atnf: ChairmanOfTheAuditCommitteeMember

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 atnf: MrJordanMember

 2023-09-07
 2023-09-07

 atnf: ClassKSpecialVotingSharesMember

 2024-03-12