Enveric Biosciences, Inc.

Previous wording

We are a biotechnology company dedicated to the development of novel neuroplastogenic small-molecule therapeutics for the treatment of depression, anxiety, addiction, and other psychiatric disorders. Leveraging our unique discovery and development platform, the Psybrary™, which houses proprietary information on the use and development of existing and novel molecules for specific mental health indications, Enveric seeks to develop a robust intellectual property portfolio of novel drug candidates.

Current wording

We are a biotechnology company dedicated to the development of novel neuroplastogenic small-molecule therapeutics for the treatment of depression, anxiety, addiction, and other psychiatric disorders. Leveraging our unique discovery and development Psybrary™ platform, which houses proprietary information on the use and development of existing and novel molecules for specific mental health indications, we seek to develop a robust intellectual property portfolio of novel drug candidates.

Previous wording

Enveric’s lead program, the EVM301 Series, and its lead drug candidate, EB-003, are intended to offer a first-in-class, new approach to the treatment of difficult-to-address mental health disorders, mediated by the promotion of neuroplasticity and without also inducing hallucinations in the patient. Enveric unveiled its EVM401 Series on February 25, 2025, which is intended to broaden Enveric’s pipeline with additional non-hallucinogenic molecules and strengthen its ability to target addiction and neuropsychiatric disorders for patients with limited options. Previously, Enveric was developing the EVM201 Series, and its drug candidate EB-002 (formerly EB-373), for the treatment of neuropsychiatric disorders. The EVM201 Series comprised next generation synthetic prodrugs of the active metabolite, psilocin. In the fourth quarter of 2024, Enveric out-licensed the EVM201 Series program to MycoMedica Life Sciences, who will seek to develop, manufacture, and commercialize EB-002, in exchange for certain development and milestone payments to Enveric (discussed below).

Current wording

Our lead program, the EVM301 Series, and its lead drug candidate, EB-003, are intended to offer a first-in-class, new approach to the treatment of difficult-to-address mental health disorders, mediated by the promotion of neuroplasticity and without also inducing hallucinations in the patient. We unveiled a EVM401 Series on February 25, 2025, which is intended to broaden our pipeline with additional non-hallucinogenic molecules and strengthen our ability to target addiction and neuropsychiatric disorders for patients with limited options. Previously, we were developing the EVM201 Series, and its drug candidate EB-002 (formerly EB-373), for the treatment of neuropsychiatric disorders. The EVM201 Series comprised next generation synthetic prodrugs of the active metabolite, psilocin. In the fourth quarter of 2024, we out-licensed the EVM201 Series program to MycoMedica Life Sciences, who will seek to develop, manufacture, and commercialize EB-002, in exchange for certain development and milestone payments to us (discussed below).

Previous wording

Following our amalgamation with MagicMed in September 2021, we have continued to pursue the development of MagicMed’s proprietary library, the Psybrary™, which we believe will help us to identify and develop the right drug candidates needed to address mental health challenges, including depression, anxiety, and addiction disorders. We synthesize novel phenylalkylamines and indolethylamines, using a mixture of chemistry and synthetic biology, resulting in the expansion of the Psybrary™, which currently includes 20 patent families with claims covering a million potential molecular structures, over one thousand of which we have so far synthesized in sufficient quantities to identify and hundreds of which we have screened for receptor binding and other relevant activities.

Current wording

Following our amalgamation with MagicMed in September 2021, we have continued to pursue the development of MagicMed’s Psybrary™, its proprietary library, which we believe will help us to identify and develop the right drug candidates needed to address mental health challenges, including depression, anxiety, and addiction disorders. We synthesize novel phenylalkylamines and indolethylamines, using a mixture of chemistry and synthetic biology, resulting in the expansion of the Psybrary™, which currently includes 20 patent families with claims covering a million potential molecular structures, over one thousand of which we have so far synthesized in sufficient quantities to identify and hundreds of which we have screened for receptor binding and other relevant activities.

Previous wording

At this stage, we have entered into several non-binding term sheets with strategic partners to out-license certain molecules from the Psybrary™. Going forward, in order to build a pipeline of product candidates, we intend to both continue to internally develop new drug candidates with associated intellectual property and to acquire, through in-licensing, additional intellectual property from pharmaceutical and biotechnology companies and research institutions. The in-licensed assets could include both research stage and clinical stage drug candidates.

Current wording

We have entered into several out-license agreements with strategic partners for specific molecules from the Psybrary™. Going forward, in order to build a pipeline of product candidates, we intend to both continue to internally develop new drug candidates with associated intellectual property and to acquire, through in-licensing, additional intellectual property from pharmaceutical and biotechnology companies and research institutions. The in-licensed assets could include both research stage and clinical stage drug candidates.

Previous wording

Depreciation and amortization expense for the three months ended March 31, 2025 was $81,024 as compared to $85,409 for the three months ended March 31, 2024, with a decrease of $4,385, or approximately 5%.

Current wording

Depreciation and amortization expense for the three months ended June 30, 2025 was $39,980 as compared to $84,779 for the three months ended June 30, 2024, with a decrease of 44,799, or approximately 53%, due to full amortization of the Company’s intangible assets during the first quarter of 2025.

Previous wording

Our general and administrative expenses decreased to $1,360,138 for the three months ended March 31, 2025 from $1,885,753 for the three months ended March 31, 2024, a decrease of $525,615, or 28%. This change was primarily driven by decreases in director fees of $147,000, accounting fees of $68,954, legal fees of $48,852, salaries and wages of $56,360, stock compensation expense of $52,703, insurance expenses of $25,994, audit fees of $23,845, software expense of $21,234, and public company fees of $43,458.

Current wording

Our general and administrative expenses decreased to $2,579,156 for the six months ended June 30, 2025 from $3,133,904 for the six months ended June 30, 2024, a decrease of $554,748, or 18%. This change was primarily driven by decreases in director fees of $144,587, stock compensation expense of $112,317, accounting fees of $58,016, insurance expenses of $51,392, legal fees of $46,973, franchise tax of $39,904 software expense of $34,031, and public company fees of $25,822.

Previous wording

Our research and development expense for the three months ended March 31, 2025 was $746,371 as compared to $506,155 for the three months ended March 31, 2024 with an increase of $240,216, or approximately 47%. This increase was primarily driven by an increase in consulting fees of $305,032 and a prior year gain that was realized during the three months ended March 31, 2024 related to the Australian R&D tax incentive of $399,987, offset by decreases in CRO costs of $398,744, salaries and wages of $147,725 and rent expense of $28,577.

Current wording

Our research and development expense for the six months ended June 30, 2025 was $2,006,422 as compared to $1,071,156 for the six months ended June 30, 2024 with an increase of $935,266, or approximately 87%. This increase was primarily driven by an increase in consulting fees of $1,136,455, and a prior year gain that was realized during the six months ended June 30, 2024 related to the Australian R&D tax incentive of $259,591, offset by a decrease in salaries and wages of $294,545 and CRO costs of $244,390.

Previous wording

The Company has incurred losses since inception resulting in an accumulated deficit of $108,259,471 as of March 31, 2025 and further losses are anticipated in the development of its business. For the three months ended March 31, 2025, the Company had a loss from operations of $2,187,533. Further, the Company had operating cash outflows of $2,391,582 for the three months ended March 31, 2025. Since inception, being a research and development company, the Company has not generated revenue and the Company has incurred continuing losses from its operations. The Company’s operations have been funded principally through the issuance of debt and equity. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these unaudited condensed consolidated financial statements.

Current wording

The Company has incurred losses since inception resulting in an accumulated deficit of $110,778,652 as of June 30, 2025 and further losses are anticipated in the development of its business. For the six months ended June 30, 2025, the Company had a loss from operations of $4,706,582. Further, the Company had operating cash outflows of $4,281,724 for the six months ended June 30, 2025. Since inception, being a research and development company, the Company has not yet generated revenue and the Company has incurred continuing losses from its operations. The Company’s operations have been funded principally through the issuance of debt and equity. These factors raise substantial doubt about the Company’s ability to continue as a going concern for a period of one year from the issuance of these unaudited condensed consolidated financial statements.

Previous wording

In assessing the Company’s ability to continue as a going concern, the Company monitors and analyzes its cash and its ability to generate sufficient cash flow in the future to support its operating and capital expenditure commitments. At March 31, 2025, the Company had cash of $4,294,435 and working capital of $3,650,434. The Company’s current cash on hand is insufficient to satisfy its operating cash needs for the 12 months following the filing of this Quarterly Report on Form 10-Q. These conditions raise substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year after the date the financial statements are issued. Management’s plan to alleviate the conditions that raise substantial doubt include raising additional working capital through public or private equity or debt financings or other sources, and may include additional collaborations with third parties as well as disciplined cash spending. For example, the Company recently entered into an agreement with H.C. Wainwright & Co., LLC to conduct an “at-the-market” offering, whereby the Company may offer and sell shares of its common stock for an aggregate offering price of up to $1.8 million. Adequate additional financing may not be available to us on acceptable terms, or at all. Should the Company be unable to raise sufficient additional capital, the Company may be required to undertake cost-cutting measures including delaying or discontinuing certain operating activities.

Current wording

In assessing the Company’s ability to continue as a going concern, the Company monitors and analyzes its cash and its ability to generate sufficient cash flow in the future to support its operating and capital expenditure commitments. At June 30, 2025, the Company had cash of $2,849,816 and working capital of $1,943,687. The Company’s current cash on hand is insufficient to satisfy its operating cash needs for the 12 months following the filing of this Quarterly Report on Form 10-Q. These conditions raise substantial doubt regarding the Company’s ability to continue as a going concern for a period of one year after the date the financial statements are issued. Management’s plan to alleviate the conditions that raise substantial doubt include raising additional working capital through public or private equity or debt financings or other sources, and may include additional collaborations with third parties as well as disciplined cash spending. Adequate additional financing may not be available to us on acceptable terms, or at all. Should the Company be unable to raise sufficient additional capital, the Company may be required to undertake cost-cutting measures including delaying or discontinuing certain operating activities.

Previous wording

As a result of these factors, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern for a period of one year after the date of the financial statements. The Company’s unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Current wording

As a result of these factors, management has concluded that there is substantial doubt about the Company’s ability to continue as a going concern for a period of one year after the date of the unaudited condensed consolidated financial statements. The Company’s unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

Previous wording

Cash Flows for the Three Months Ended March 31, 2025 and 2024

Current wording

Cash Flows for the Six Months Ended June 30, 2025 and 2024

Previous wording

Net cash used in operating activities was $2,391,582 during the three months ended March 31, 2025, which consisted primarily of a net loss adjusted for non-cash items of $1,912,659, an increase in prepaid expenses of $46,126, a decrease in related party expenses of $131,516 and a decrease in accounts payable and accrued liabilities of $301,281.

Current wording

Net cash used in operating activities was $4,281,724 during the six months ended June 30, 2025, which consisted primarily of a net loss adjusted for non-cash items of $4,185,600, a decrease in prepaid expenses and other current assets of $48,192, a decrease in related party payable of $133,016 and a decrease in accounts payable and accrued liabilities of $11,300.

Previous wording

Net cash used in operating activities was $2,598,347 during the three months ended March 31, 2024, which consisted primarily of a net loss adjusted for non-cash items of $2,041,455, an increase in prepaid expenses and other current assets of $759,289, offset by an increase in accounts payable and accrued liabilities of $202,397.

Current wording

Net cash used in operating activities was $5,487,520 during the six months ended June 30, 2024, which consisted primarily of a net loss adjusted for non-cash items of $3,485,028, an increase in prepaid expenses and other current assets of $543,822, and a decrease in accounts payable and accrued liabilities of $1,458,670.

Previous wording

Net cash provided by financing activities was $4,448,914 during the three months ended March 31, 2025, which consisted of $4,373,870 in proceeds from the Offering, and $75,044 in proceeds from the exercise of warrants.

Current wording

Net cash provided by financing activities was $4,898,010 during the six months ended June 30, 2025, which consisted of $4,244,467 in net proceeds from the Offering, $75,044 in proceeds from the exercise of warrants, and $578,499 in net proceeds from the sale of Common Stock through the ATM Agreement.

Previous wording

Net cash provided by financing activities was $6,658,269 during the three months ended March 31, 2024, which consisted of $1,817,640 from the proceeds received from the stock subscription receivable, $2,676,980 for the exercise of the inducement warrants, and $2,307,707 for the common stock sold under a distribution agreement, net of offering costs, and offset by $144,058 offering costs previously accrued for the inducement warrants.

Current wording

Net cash provided by financing activities was $6,692,699 during the six months ended June 30, 2024, which consisted of $1,804,819 from the net proceeds received from the stock subscription receivable, $2,676,980 for the exercise of the inducement warrants, $2,290,186 for the Common Stock sold under a distribution agreement, net of offering costs, and $82,026 for the Common Stock sold under the Purchase Agreement, offset by $161,312 offering costs previously accrued for the inducement warrants.