InMed Pharmaceuticals Inc.

Current report

In addition to the other information set forth in this Quarterly Report, you should carefully consider the risk factors discussed in Part I, Item 1A, “Risk Factors” in our 2026 Annual Report on Form 10-K for the Fiscal, which could materially affect our business, financial condition or future results. Except as set forth below, there have been no material changes to the risk factors disclosed in our 2026 Annual Report.

Current report

The assignment for the benefit of creditors process in respect of BayMedica, LLC is subject to significant uncertainty and could expose us to unanticipated liabilities, reputational harm, and adverse effects on our business and financial condition.

Current report

On October 2, 2026, Pashman Stein Walder Hayden P.C. was engaged by BayMedica in connection with a potential assignment for the benefit of its creditors proceeding under the laws of the State of Delaware (the "ABC") as a means of completing the wind down of substantially all of BayMedica's commercial operations. In connection with the ABC, BayMedica expects to assign all or substantially all of its remaining assets to an assignee that would be responsible for liquidating those assets and distributing the net proceeds to BayMedica's creditors in accordance with applicable law. The timing, costs and outcome of the ABC are uncertain, and there can be no assurance as to (i) whether or when the ABC will be completed, (ii) the amounts, if any, that will be available to BayMedica's creditors, or (iii) the effects of the ABC on the Company.

Current report

Although the Company is BayMedica's largest secured creditor, the Company does not currently expect to receive any proceeds from the ABC. This means we are unlikely to recover any material value from BayMedica's remaining assets through the ABC process, and we may be required to write off any residual intercompany amounts or recognize additional losses in connection with the conclusion of BayMedica's operations.

Current report

The Company has at all times held an indirect beneficial interest in BayMedica through InMed Pharmaceuticals Ltd., a Delaware corporation and wholly-owned direct subsidiary of the Company, and the Company is not a guarantor of BayMedica's obligations. Although our indirect ownership structure means we are not directly liable for BayMedica's obligations as a guarantor, this does not fully insulate us from risk. The ABC process may give rise to claims or proceedings against BayMedica that could indirectly affect InMed as its parent, including potential claims by BayMedica's creditors or the ABC assignee in respect of intercompany transactions, intellectual property licensing, or other arrangements between InMed and BayMedica.

Current report

The ABC process may also result in adverse publicity or reputational damage to InMed. Counterparties, partners, regulators, and investors may associate the BayMedica wind-down and ABC with InMed's broader financial condition, even though BayMedica's operations have been classified as discontinued and InMed is not a guarantor of its obligations. Any such reputational effects could impair InMed's ability to attract new partners, raise additional capital, or pursue and close the proposed Merger with Mentari Therapeutics, Inc. on the anticipated timeline or at all.

Current report

There can be no assurance that the ABC will be completed efficiently, that the assignee will act in a manner consistent with InMed's interests, or that the process will not give rise to additional claims, costs, or obligations that could adversely affect InMed's business, financial condition, results of operations, or prospects.

Previous report

We are winding down our only revenue-generating business segment, which creates substantial uncertainty regarding our liquidity, results of operations, prospects, and ability to continue as a going concern.

Previous report

On March 4, 2026, our board of directors ratified BayMedica’s decision to wind down and exit its commercial operations. We intend to substantially complete the wind down prior to June 30, 2026, while continuing limited commercial activities in the interim. The wind down may take longer or cost more than anticipated, and we may not realize expected savings, proceeds or strategic benefits. We expect to incur approximately $550,000 in severance and other employee-related costs and approximately $120,000 in additional related expenditures through the end of the fiscal year, partially offset by profits from product sales prior to completion; we may also incur other charges and may be unable to exit or assign contracts on acceptable terms. As a result, our liquidity, cash flows, results of operations, and financial condition are subject to significant uncertainty, and there can be no assurance that we will be able to fund operations or meet obligations as they come due.

Previous report

Because BayMedica’s commercial operations is our only revenue-generating business segment, our ability to comply with debt covenants and other financial maintenance requirements may be adversely affected, and we may be unable to monetize assets on terms and timing that support our liquidity needs. The wind down may negatively affect our workforce and internal controls, and our reduced revenues and potential losses could affect our access to capital. Execution of the wind down and the corresponding transition depends on numerous assumptions and external factors, and delays or shortfalls could further increase costs, reduce liquidity, and adversely affect our ability to pursue strategic opportunities. There can be no assurance that we will successfully transition to a new business model or generate sustainable revenues or profitability in the future; if we cannot, our business, financial condition, results of operations, and prospects would be materially and adversely affected, and we may need to undertake additional restructuring or other actions that could be dilutive or otherwise detrimental to investors.

Previous report

In accordance with applicable Nasdaq procedures, we have a period of 180 calendar days following the receipt of the written notice mentioned above to cure the deficiency and regain compliance. The notice has no immediate impact on the listing of our common shares, which will continue to trade on The Nasdaq Capital Market subject to our continued compliance with the other listing requirements of The Nasdaq Capital Market. Our common shares will continue to trade under the symbol “INM”. We intend to monitor the closing share price for our common shares and explore available options to regain compliance.

Previous report

In the event we do not evidence compliance with the minimum bid price rule during the 180-day grace period, we may be eligible for an additional 180 calendar day grace period. To qualify, we will be required to meet the continued listing requirement for market value of publicly held shares and all other listing standards for The Nasdaq Capital Market, with the exception of the minimum bid price rule, and will need to provide written notice of our intention to cure the deficiency during the second compliance period, by effecting a reverse stock split, if necessary, to Nasdaq. If it appears to the staff of Nasdaq that we will not be able to cure the deficiency, or if we are otherwise not eligible, we will not be entitled to an additional 180 calendar days grace period and Nasdaq will provide notice to us that our securities will be subject to delisting. If we do not regain compliance within the allotted compliance period(s), including any extensions that may be granted by Nasdaq, it is expected that Nasdaq would notify us that our common shares are subject to delisting. If we are notified by Nasdaq that our securities are subject to delisting, we may appeal such determination to the Panel, but our securities would be automatically suspended from trading on The Nasdaq Capital Market pending the completion of the appeal process. There can be no assurance that any such appeal would be successful or that we would be able to evidence compliance with the terms of any extension that may be granted by the Panel.

Previous report

Delisting from The Nasdaq Capital Market could materially and adversely affect our ability to raise additional financing through the public or private sale of equity securities, would significantly affect the ability of investors to trade our securities and would negatively affect the value and liquidity of our securities, including our common shares. The actual or threatened delisting of our securities could also have other material and adverse consequences, including the potential loss of confidence by employees and other stakeholders, the loss of institutional investor interest and fewer business development opportunities, limited availability of market quotations for our securities, reduced liquidity with respect to our securities, a determination that our common shares is “penny stock,” which will require brokers trading in our common shares to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our common shares, and limited amount of news and analyst coverage of us. To the extent that our common shares became eligible to trade on the OTC Bulletin Board, another over-the-counter quotation system, or on the pink sheets, an investor may find it more difficult to dispose of their common shares or obtain accurate quotations as to the market value of our common shares.

Previous report

Furthermore, the National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or preempts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our common shares are currently listed on The Nasdaq Capital Market, such securities will be deemed covered securities. Although the states will be preempted from regulating the sale of our securities, the federal statute does allow states to investigate companies if there is a suspicion of fraud and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. Additionally, if we were no longer listed on The Nasdaq Capital Market, our securities would not be covered securities and we would be subject to regulations in each state in which we offer our securities. Upon a delisting of our common shares, this offering would immediately terminate.