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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>As filed with the Securities and Exchange
Commission on June 25, 2019</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Registration No. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B>UNITED
STATES<BR>
SECURITIES AND EXCHANGE COMMISSION<BR>
Washington, D.C. 20549</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 14pt"><B>FORM
S-1</B></FONT><B><FONT STYLE="font-family: Times New Roman, Times, Serif"><BR>
REGISTRATION STATEMENT<BR>
UNDER<BR>
THE SECURITIES ACT OF 1933</FONT></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B>DelMar
Pharmaceuticals, Inc.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B>(Exact
name of registrant as specified in its charter)<BR>
<BR>
</B></FONT></P>

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    <TD STYLE="width: 32%; padding-top: 0; padding-right: 0; border-bottom: Black 1.5pt solid; padding-left: 0; text-align: center; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Nevada</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 2%; padding: 0 0 1.5pt; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 32%; padding-top: 0; padding-right: 0; border-bottom: Black 1.5pt solid; padding-left: 0; text-align: center; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2834</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 2%; padding: 0 0 1.5pt; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="width: 32%; padding-top: 0; padding-right: 0; border-bottom: Black 1.5pt solid; padding-left: 0; text-align: center; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>99-0360497</B></FONT></TD></TR>
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    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>(State
    or other jurisdiction of<BR>
 incorporation or organization)</B></FONT></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>(Primary
    Standard Industrial<BR>
 Classification Code Number)</B></FONT></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>(I.R.S.
    Employer<BR>
    Identification Number)</B></FONT></TD></TR>
</TABLE>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B>Suite
720-999 West Broadway<BR>
Vancouver, British Columbia, Canada V5Z 1K5<BR>
(604) 629-5989<BR>
(Address, including zip code, and telephone number, including area code, of registrant&rsquo;s principal executive offices)</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B>Saiid
Zarrabian<BR>
President and Chief Executive Officer<BR>
DelMar Pharmaceuticals, Inc.<BR>
Suite 720-999 West Broadway<BR>
Vancouver, British Columbia, Canada V5Z 1K5<BR>
(604) 629-5989</B></FONT></P>

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address, including zip code, and telephone number, including area code, of agent for service)</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B><I>Copies
to:</I></B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif"><B>Michael
J. Lerner, Esq.</B><BR>
<B>Steven M. Skolnick, Esq.</B><BR>
<B>Lowenstein Sandler LLP</B><BR>
<B>1251 Avenue of the Americas</B><BR>
<B>New York, New York 10020</B><BR>
<B>Tel: (212) 262-6700</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Approximate date of commencement of proposed sale to the
public</B>: As soon as practicable after this registration statement becomes effective.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, check the following box.&nbsp;&#9746;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the
same offering.&nbsp;&#9744;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering.&nbsp;&#9744;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering.&nbsp;&#9744;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Indicate by check mark whether the registrant 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 &ldquo;large accelerated filer,&rdquo; &ldquo;accelerated filer,&rdquo; &ldquo;smaller reporting company&rdquo; and &ldquo;emerging
growth company&rdquo; in Rule 12b-2 of the Exchange Act:</P>

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    <TD STYLE="width: 3%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 30%; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Large accelerated filer</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 18%; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9744;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 28%; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Accelerated filer</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 17%; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9744;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Non-accelerated filer</FONT></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9744;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Smaller reporting company</FONT></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9746;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Emerging growth company</FONT></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9744;</FONT></TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">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 7(a)(2)(B) of the Securities Act.
</FONT>&#9744;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CALCULATION OF REGISTRATION FEE</B></P>

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    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Title of Each Class of Securities to be Registered</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><BR><BR><BR>Amount to be Registered<SUP>(2)</SUP></B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Proposed Maximum Offering Price Per Share<SUP>(3)</SUP></B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Proposed <BR> Maximum <BR> Aggregate<BR> Offering&nbsp;Price</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Amount of <BR> Registration Fee</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Common Stock, par value $0.001 per share<SUP>(1)</SUP></FONT></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">760,500</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">1.54</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">1,171,170</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">$141.95</TD><TD STYLE="width: 1%; text-align: left"></TD></TR>
</TABLE>

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<TD STYLE="width: 0"></TD><TD STYLE="width: 24pt; text-align: left">(1)</TD><TD>Represents the resale of shares of Common Stock issuable
upon the exercise of certain warrants issued in a private placement described herein.</TD>
</TR></TABLE>

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<TD STYLE="width: 0"></TD><TD STYLE="width: 24pt">(2)</TD><TD>In addition to the shares of Common Stock set forth in this table, pursuant to Rule 416 under the Securities Act, this registration
statement also registers such indeterminate number of shares of Common Stock as may become issuable upon exercise of these securities
as the same may be adjusted as a result of stock splits, stock dividends, recapitalizations or other similar transactions.</TD></TR></TABLE>

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<TD STYLE="width: 0"></TD><TD STYLE="width: 24pt">(3)</TD><TD>Estimated solely for the purpose of computing the amount of the registration fee for the shares of Common Stock issuable upon
exercise of warrants being registered in accordance with Rule 457(c) under the Securities Act based upon the average of the high
and low prices for a share of the registrant&rsquo;s common stock as reported on The Nasdaq Capital Market on June 21, 2019, which
date is within five business days of the filing of this registration statement.</TD></TR></TABLE>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>The registrant hereby amends this registration statement
on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which
specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities
Act or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: Red"><B>The
information in this prospectus is not complete and may be changed. The selling stockholders named in this prospectus may not sell
these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the
offer or sale is not permitted.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; color: Red"><B><I>PRELIMINARY
PROSPECTUS, SUBJECT TO COMPLETION, DATED JUNE 25, 2019</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><IMG SRC="img_001.jpg" ALT="" STYLE="width: 272px; height: 71px"></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 12pt"><B>760,500&nbsp;Shares&nbsp;of&nbsp;Common&nbsp;Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 12pt"><B>Issuable
upon Exercise of Outstanding Warrants</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">This
prospectus relates to the resale from time to time, by the selling stockholders identified in this prospectus under the caption
&ldquo;Selling Stockholders,&rdquo; of up to 760,500 shares of our common stock, par value $0.001 per share, they may acquire
upon the exercise of outstanding warrants, which we refer to as the Warrants. We issued the Warrants to the selling stockholders
in a private placement concurrent with a registered direct offering of 1,170,000 shares of our common stock which was completed
on June 5, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
selling stockholders may sell the shares of common stock being offered by this prospectus from time to time on terms to be determined
at the time of sale through ordinary brokerage transactions or through any other means described in this prospectus under &ldquo;Plan
of Distribution.&rdquo; The prices at which the selling stockholders may sell the shares will be determined by the prevailing
market price for the shares or in negotiated transactions. We will not receive any proceeds from the sale of the shares by the
selling stockholders. However, we will receive the proceeds from the exercise of the Warrants by the selling stockholders, if
any, to the extent that the Warrants are not exercised on a cashless basis. See the section entitled &ldquo;Use of Proceeds&rdquo;
on page 25 of this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">I<B>nvesting
in our securities involves a high degree of risk. See &ldquo;Risk Factors&rdquo; beginning on page 6 of this prospectus.
You should carefully consider these risk factors, as well as the information contained in this prospectus, before you invest.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
common stock is listed on The Nasdaq Capital Market, or Nasdaq, under the symbol &ldquo;DMPI.&rdquo; On June 21, 2019, the last
reported sale price of our common stock was $1.54 per share. On May 8, 2019, we effected a one-for-ten reverse stock split of
our issued and outstanding and authorized Common Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
date of this Prospectus is &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2019</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>TABLE
OF CONTENTS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 92%; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 7%; padding: 0; text-align: center; text-indent: 0; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Page</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_001"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PROSPECTUS SUMMARY</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_002"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">THE OFFERING</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">5</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_003"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">RISK FACTORS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">6</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_004"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">FORWARD-LOOKING STATEMENTS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">24</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_005"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">USE OF PROCEEDS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">25</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_006"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">MANAGEMENT&rsquo;S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">26</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_007"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">BUSINESS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">34</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_008"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">MANAGEMENT</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">57</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_009"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">EXECUTIVE COMPENSATION</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">61</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_010"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">65</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_011"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PRINCIPAL STOCKHOLDERS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">66</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_012"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">MARKET PRICE OF OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">67</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_013"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DIVIDEND POLICY</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">67</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_014"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">SELLING STOCKHOLDERS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">67</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_015"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DESCRIPTION OF SECURITIES</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">69</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_016"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PLAN OF DISTRIBUTION</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">72</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_017"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">LEGAL MATTERS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">74</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_018"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">EXPERTS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">74</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCECFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_019"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">WHERE YOU CAN FIND MORE INFORMATION</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif">74</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><A HREF="#a_020"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">INDEX TO FINANCIAL STATEMENTS</FONT></A></TD>
    <TD STYLE="white-space: nowrap; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-1</FONT></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>ABOUT
THIS PROSPECTUS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
registration statement of which this prospectus forms a part that we have filed with the Securities and Exchange Commission, or
SEC, includes exhibits that provide more detail of the matters discussed in this prospectus. You should read this prospectus and
the related exhibits filed with the SEC, together with the additional information described under the heading &ldquo;Where You
Can Find More Information&rdquo; before making your investment decision.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">You
should rely only on the information provided in this prospectus or in a prospectus supplement or any free writing prospectuses
or amendments thereto. We have not authorized anyone else to provide you with different information. If anyone provides you with
different or inconsistent information, you should not rely on it. You should assume that the information in this prospectus is
accurate only as of the date hereof. Our business, financial condition, results of operations and prospects may have changed since
that date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are not selling any shares of our common stock under this prospectus, and we will not receive any proceeds from the sale of shares
of common stock offered hereby by the selling stockholders. This prospectus may only be used where it is legal to offer and sell
our securities. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities
in any jurisdiction where the offer or sale is not permitted.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DelMar
Pharmaceuticals, Inc. and its consolidated subsidiaries are referred to herein as &ldquo;DelMar,&rdquo; &ldquo;the Company,&rdquo;
&ldquo;we,&rdquo; &ldquo;us&rdquo; and &ldquo;our,&rdquo; unless the context indicates otherwise. Solely for convenience, trademarks
and tradenames referred to in this prospectus may appear without the &reg; or &trade; symbols, but such references are not intended
to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights, or that the applicable
owner will not assert its rights, to these trademarks and tradenames.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_001"></A><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>PROSPECTUS
SUMMARY</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>This
summary contains basic information about us and this offering. Because it is a summary, it does not contain all of the information
that you should consider before investing. To understand this offering fully, you should read this entire prospectus carefully,
including the section entitled &ldquo;Risk Factors&rdquo; and any information incorporated by reference herein.</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 8, 2019, we effected a one-for-ten reverse stock split (the &ldquo;Reverse Stock Split&rdquo;) of our issued and outstanding
and authorized common stock. All per share amounts and number of shares of common stock in this prospectus reflect the Reverse
Stock Split. The Reverse Stock Split does not affect our authorized preferred stock of 5,000,000 shares; except that, pursuant
to the terms of the Certificate of Designations of Series B Convertible Preferred Stock for the issued and outstanding shares
of our Series B Convertible Preferred Stock, par value $0.001 per share (the &ldquo;Series B Preferred Stock&rdquo;), the conversion
price at which shares of Series B Preferred Stock may be converted into shares of common stock will be proportionately adjusted
to reflect the Reverse Stock Split.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Our
Business</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Background</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. Our
mission is to benefit patients by developing and commercializing anti-cancer therapies for patients whose tumors exhibit features
that make them resistant to, or unlikely to respond to, currently available therapies, particularly for orphan cancer indications
where patients have failed, or are unlikely to respond to, currently available therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of December 31, 2018, we have spent approximately $37.3 million of shareholder capital in developing VAL-083, a novel, validated,
DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma multiforme (&ldquo;GBM&rdquo;) and
potentially other solid tumors, including ovarian cancer, non-small cell lung cancer (&ldquo;NSCLC&rdquo;), and diffuse intrinsic
pontine glioma (&ldquo;DIPG&rdquo;). VAL-083 is a first-in-class, small-molecule, DNA-targeting chemotherapeutic that demonstrated
activity against a range of tumor types in prior Phase 1 and Phase 2 clinical studies sponsored by the US National Cancer Institute
(&ldquo;NCI&rdquo;). As part of our business strategy, we leverage and build upon these prior NCI investments and data from more
than 40 NCI- Phase 1 and Phase 2 clinical studies, which includes an estimated 1,000 patient safety database, with our own research
to identify and target unmet medical needs in modern cancer care. DNA-targeting agents are among the most successful and widely
used treatments for cancer. Their efficacy is based on the ability to bind with a cancer cell&rsquo;s DNA and interfere with the
process of protein production required for growth and survival of cancer cells. &ldquo;First-in-class&rdquo; means that VAL-083
embodies a unique molecular structure which is not an analogue or derivative of any approved product, or product under development,
for the treatment of cancer.</FONT></P>

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</DIV>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
recent research has highlighted the opportunities afforded by VAL-083&rsquo;s unique mechanism of action and its potential to
address unmet medical needs by focusing our development efforts on patients whose tumors exhibit biological features that make
them resistant to, or unlikely to respond to, currently available therapies. For example, our research demonstrating VAL-083&rsquo;s
activity in GBM independent of the O6-methyl guanine methyltransferase (&ldquo;MGMT&rdquo;) methylation status allows us to focus
patient selection based on this important biomarker.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are conducting two open-label, biomarker driven Phase 2 studies in MGMT-unmethylated GBM. MGMT is a DNA-repair enzyme that is
associated with resistance to temozolomide, the current standard-of-care chemotherapy used in the treatment of GBM. Greater than
60% of GBM patients have MGMT-unmethylated tumors and exhibit a high expression of MGMT, which is correlated with temozolomide
treatment failure and poor patient outcomes. Our research demonstrates that VAL-083&rsquo;s anti-tumor activity is independent
of MGMT expression. In our Phase 2 studies we are using MGMT as a biomarker to identify patients for treatment with VAL-083 in
the newly-diagnosed, maintenance-stage (adjuvant) and recurrent treatment settings. If successful, the result of these studies
could position VAL-083 for advancement to pivotal clinical studies as a potential replacement for temozolomide in MGMT-unmethylated
GBM. We anticipate presenting data from these studies at peer reviewed scientific meetings during calendar 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">With
respect to our STAR-3, Phase 3 study, we have finalized the decision to discontinue this clinical study due to the competitive
landscape, patient enrollment rates, and potential risk of success assessment, and to allow us to focus on enrolling GBM patients
in our two biomarker-driven Phase 2 studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have received notice to proceed from the US Food and Drug Administration (&ldquo;FDA&rdquo;) for a phase 1/2, open-label, multicenter
study of VAL-083 in patients with <B><U>Re</U></B>current <B><U>P</U></B>latinum <B><U>R</U></B>esistant <B><U>Ov</U></B>arian
Cancer (&ldquo;REPROVe&rdquo;). Platinum-based chemotherapy is the standard-of-care in the treatment of ovarian cancer. Nearly
all ovarian cancer patients eventually become resistant to platinum (&ldquo;Pt&rdquo;) based chemotherapy leading to treatment
failure and poor patient outcomes. We have demonstrated that VAL-083 is active against Pt-resistant ovarian cancer <I>in vitro.
</I>However, based on ongoing evaluation and input from our ovarian cancer advisory board, we are reassessing the development
of VAL-083 for the treatment of ovarian cancer. We are in the process of evaluating the best path forward in ovarian cancer and
are evaluating strategic options, including the potential combination of VAL-083 with PARP inhibitors. At the American Association
for Cancer Research (&ldquo;AACR&rdquo;) Annual Meeting in 2018 we presented preclinical data showing that VAL-083 can synergize
PARP inhibitors in both a BRACA-proficient and -deficient setting.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to our clinical development activities in the United States, pursuant to our collaboration with Guangxi Wuzhou Pharmaceutical
(Group) Co. Ltd. (&ldquo;Guangxi Wuzhou Pharmaceutical Company&rdquo;), we have provided Guangxi Wuzhou Pharmaceutical Company
certain commercial rights to VAL-083 in China where it is approved as a chemotherapy for the treatment of chronic myelogenous
leukemia (&ldquo;CML&rdquo;) and lung cancer. Guangxi Wuzhou Pharmaceutical Company is the only manufacturer presently licensed
by the China Food and Drug Administration (&ldquo;CFDA&rdquo;) to produce the product for the China market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have a broad patent portfolio to protect our intellectual property. Our patent applications claim composition of matter and methods
of use of VAL-083 and related compounds, synthetic methods, and quality controls for the manufacturing process of VAL-083. We
believe that our portfolio of intellectual property rights provides a defensible market position for the commercialization of
VAL-083. In addition, VAL-083 has been granted protection under the Orphan Drug Act by the FDA and the European Medicines Agency
(&ldquo;EMA&rdquo;) for the treatment of gliomas, including GBM. The FDA has also granted Orphan Drug protection to VAL-083 for
the treatment of medulloblastoma and ovarian cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
corporate development strategy is to advance our drug candidate into multiple clinical studies and then to consider licensing,
or acquiring additional product candidates, in order to establish a product pipeline and to position us for long-term sustainability
and growth of shareholder value. We believe the experience of our clinical development team will position us to efficiently develop
drug candidates that we may acquire, or license, in the future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
intend to continue to evaluate options for our strategic direction. These options may include raising additional capital, the
acquisition of another company and/or complementary assets, our sale, or another type of strategic partnership.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Registered
Direct Offering and Private Placement</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
June 3, 2019, we entered into a securities purchase agreement with the selling stockholders for the issuance and sale of an aggregate
of 1,170,000 shares of common stock in a registered direct offering (the &ldquo;RD Offering&rdquo;) and warrants to purchase 760,500
shares of common stock in a concurrent private placement, at a combined purchase price of $3.10 per share and related warrant.
The warrants have an exercise price of $3.10 per share, are immediately exercisable and have a term of exercise of five years.
The closing of the issuance and sale of these securities was consummated on June 5, 2019. The gross proceeds from the offering,
prior to deducting offering expenses and placement agent fees and expenses payable by us, were $3.6 million.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Subject
to certain ownership limitations, the warrants are exercisable commencing on the issuance date at an exercise price equal to $3.10
per share of common stock, subject to adjustments as provided under the terms of the warrants. Subject to certain exceptions set
forth in the warrants, if, on or prior to June 28, 2019, we sell or grant any option to purchase or sell or grant any right to
reprice, or otherwise dispose of or issue, any common stock or securities convertible into or exercisable for common stock at
an effective price per share that is lower than the exercise price of the warrants then in effect, then the exercise price of
the Warrants will be reduced to equal the higher of&thinsp; (A) such lower price or (B) $2.25. Pursuant to the terms of the securities
purchase agreement, we agreed to register for resale the shares of common stock underlying the warrants sold in the private placement.
Under the terms of the warrants, no selling stockholder may exercise a warrant to the extent the selling stockholder or any of
its affiliates would beneficially own a number of shares of our common stock which would exceed 4.99%.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

</DIV>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Recent
Highlights</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; text-align: left; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
                                         May 22, 2019, the Nasdaq Staff notified us that we did not meet the stockholders&rsquo;
                                         equity requirements as of March 31, 2019. We submitted a plan to regain compliance with
                                         Nasdaq on May 29, 2019. On June 13, 2019, the Nasdaq Hearings Panel issued a decision
                                         granting our request for continued listing, subject to the condition that on or before
                                         October 15, 2019, we shall have issued public disclosure on Form 8-K that we have met
                                         the stockholders&rsquo; equity requirement and have demonstrated compliance with all
                                         other requirements for continued listing. We expect to utilize
                                         the proceeds from the Rights Offering (as defined below) and the RD Offering towards
                                         establishing compliance with such requirement; provided that we will need to raise additional
                                         capital to obtain compliance.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">On
                                         April 18, 2019, we filed a registration statement in connection with a proposed rights
                                         offering (the &ldquo;Rights Offering&rdquo;), which registration statement was last amended
                                         on June 10, 2019. In the Rights Offering, we are proposing to issue an aggregate of 1,860
                                         units, with each unit comprising of one share of Series C Convertible Preferred Stock
                                         with a stated value of $1,000 and 209 warrants to purchase common stock. The warrants
                                         have an exercise price of $3.10 per share, are immediately exercisable and have a term
                                         of exercise of five years. Assuming the Rights Offering is fully subscribed and subject
                                         to revocation rights, the gross proceeds from the Rights Offering, prior to deducting
                                         offering expenses and dealer-manager fees and expenses payable by us, are expected to
                                         be $1.86 million.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; text-align: left; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
                                         April 4, 2019, we announced the formation of a Scientific Advisory Board (&ldquo;SAB&rdquo;).
                                         Its inaugural members are Drs. Napoleone Ferrara and John de Groot. Dr. John de Groot,
                                         Chairman, ad interim of the Department of Neuro-Oncology at the MD Anderson Cancer Center
                                         is an expert in glioma biology and angiogenesis which is the key area of clinical development
                                         for VAL-083. Dr. Ferrara is a world-renowned molecular biologist whose pioneering work
                                         on the identification of VEGF, a signal protein produced by cells that stimulates the
                                         formation of blood vessels, led to the development of Genentech Inc.&rsquo;s Avastin<SUP>&reg;
                                         </SUP>for the treatment of certain types of cancer, including ovarian cancer and GBM.
                                         Dr. Ferrara is also a member of our Board of Directors and he will serve as the SAB&rsquo;s
                                         Chairman. The SAB will work closely with our management team to optimize the development
                                         of VAL-083.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; text-align: left; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
                                         of March 13, 2019, we have enrolled 47 of the planned 48 patients in our Phase 2, open-label
                                         clinical study of VAL-083 in bevacizumab (Avastin<SUP>&reg;</SUP>)-na&iuml;ve, recurrent
                                         glioblastoma multiforme (&ldquo;rGBM&rdquo;) patients with MGMT-unmethylated status.
                                         This study is being conducted at the MD Anderson Cancer Center (&ldquo;MDACC&rdquo;)
                                         in Houston, Texas. The study is designed to determine the impact of VAL-083 treatment
                                         on overall survival compared to historical reference control.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; text-align: left; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
                                         April 3, 2019, we announced that the MDACC Institutional Review Board (&ldquo;IRB&rdquo;)
                                         had approved the addition of up to 35 patients to our recurrent GBM study at a dose of
                                         30 mg/m<SUP>2</SUP>. As previously disclosed, we had lowered the dose in this study from
                                         40 mg/m<SUP>2</SUP> to 30 mg/m<SUP>2</SUP> to improve tolerance in this patient population
                                         and to maximize overall exposure to VAL-083 thereby increasing the number of cycles of
                                         drug patients are able to receive. Upon completion of the initial 48 patients in this
                                         study, 13&nbsp;will have had the 30 mg/m<SUP>2</SUP> dose and 35 will have had the 40
                                         mg/m<SUP>2</SUP>. Therefore, potentially adding an additional 35 patients at 30 mg/m<SUP>2
                                         </SUP>would result in a total of 48 patients receiving the 30 mg/m<SUP>2</SUP> dose.
                                         In addition, the MDACC IRB approved the addition of up to 24 patients in the pre-temozolomide
                                         (&ldquo;TMZ&rdquo;) maintenance setting. These patients will have had an initial cycle
                                         of temozolomide following radiation but will not have yet started subsequent cycles of
                                         temozolomide (i.e. maintenance stage TMZ patients). Subject to obtaining financing and
                                         all regulatory approvals, we are planning a new study arm that would potentially enroll
                                         up to 24 pre-TMZ maintenance stage, MGMT-unmethylated GBM patients.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; text-align: left; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
                                         of February 15, 2019, we have enrolled 15 of the planned up to 30 patients in our Phase
                                         2, open-label clinical study of VAL-083 in newly-diagnosed, MGMT-unmethylated GBM patients
                                         being conducted in Guangzhou, China. This study is a single-site study being conducted
                                         at Sun Yat-sen University Cancer Center (&ldquo;SYSUCC&rdquo;) on newly diagnosed MGMT-unmethylated
                                         GBM patients. Patients in this study are being treated with VAL-083 in combination with
                                         radiotherapy as a potential alternative to the current standard-of-care chemo-radiation
                                         regimen.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">At
the annual meeting of the AACR held March 29 to April 3, 2019, we presented clinical study updates on both of our Phase 2 studies
in MGMT-unmethylated GBM patients, as well as, preclinical presentations on VAL-083 in combination with Avastin<SUP>&reg;</SUP>
and on the potential to overcome major challenges in the treatment of DIPG.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Clinical
Updates Presented at 2019 American Society of Clinical Oncology</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 31, 2019, we presented clinical trial updates from our ongoing first- and second-line trials in patients with MGMT-unmethylated
glioblastoma multiforme (GBM) at a key opinion leader (KOL) presentation during the 2019 American Society of Clinical Oncology
(ASCO) annual meeting in Chicago, IL.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">At
the KOL presentation, we provided an update on the ongoing Phase 2 clinical study investigating the front-line treatment of VAL-083
with radiation therapy in newly diagnosed MGMT-unmethylated GBM. This trial is being conducted at the Sun Yat-sen University Cancer
Center (SYSUCC) in Guangzhou, China in collaboration with Guangxi Wuzhou Pharmaceutical Company. The trial is designed to enroll
up to 30 patients to determine if first-line therapy with VAL-083 treatment, in lieu of first-line temozolomide, improves progression
free survival (PFS).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

</DIV>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of May 17, 2019, eighteen patients have been enrolled in the trial. Of these patients, fifteen have received their post-cycle
3 MRI and investigator assessment, and ten have received their post-cycle 7 MRI and investigator assessment. Two patients have
not been on the study long enough to reach their first assessment, and one patient died before their first assessment. Assessments
are based on the trial investigator&rsquo;s clinical and radiologic assessment, according to the Response Assessment in NeuroOncology
(RANO) criteria. For the fifteen patients who have received at least one assessment, eight patients were assessed with a best
response of &ldquo;Complete Response&rdquo; (8/15, 53.3% CR) and seven patients were assessed with a best response of &ldquo;Stable
Disease&rdquo; (7/15, 46.7% SD). Fourteen of the eighteen patients were still alive at the data cut-off date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
also provided an update on the ongoing second-line Phase 2 clinical study of VAL-083 in patients with MGMT-unmethylated, Bevacizumab-na&iuml;ve
recurrent GBM. This study is being conducted in collaboration with The University of Texas MD Anderson Cancer Center (MDACC).
This biomarker-driven trial (testing for MGMT methylation status) has been amended to enroll up to 83 patients (35 with a starting
dose of 40 mg/m<SUP>2</SUP>; 48 with a starting dose of 30 mg/m<SUP>2</SUP>) to determine the potential of VAL-083 treatment to
improve overall survival compared to historical reference control of 7.2 months with lomustine.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">As
                                         of May 5, 2019, 51 patients have been enrolled, 35 patients at a starting dose of 40
                                         mg/m<SUP>2</SUP>, and 16&nbsp;patients at a starting dose of 30 mg/m<SUP>2</SUP><B>.</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">For
                                         the 47 patients who have been on study long enough to be assessed at the post-cycle 2
                                         MRI:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">9/35
                                         (25.7%) patients initially receiving 40 mg/m<SUP>2</SUP> exhibited &ldquo;Stable Disease&rdquo;
                                         per investigator assessment at the end of cycle 2</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">4/12
                                         (33.3%) patients initially receiving 30 mg/m<SUP>2</SUP> exhibited &ldquo;Stable Disease&rdquo;
                                         per investigator assessment at the end of cycle 2</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Additionally,
the study protocol has been amended to include enrollment of up to 24 newly-diagnosed GBM patients who have completed chemoradiation
treatment with TMZ and received no subsequent TMZ maintenance therapy but will receive VAL-083 instead (Group 2). This Group has
been included to explore whether earlier intervention with VAL-083 instead of TMZ maintenance therapy offers clinical benefit
and extends the time to recurrence as compared to TMZ maintenance therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consistent
with prior studies, myelosuppression (primarily thrombocytopenia and neutropenia) is the most common adverse event in both ongoing
clinical trials.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Risks
Affecting Us</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
business is subject to numerous risks described in the section entitled &ldquo;Risk Factors&rdquo; and elsewhere in this prospectus.
You should carefully consider these risks before making an investment. Some of these risks include:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">We
                                         have expressed substantial doubt about our ability to continue as a going concern;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">We
                                         have a limited operating history and a history of operating losses and expect to incur
                                         significant additional operating losses;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">We
                                         will need to raise additional capital;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">We
                                         are an early-stage company and may never achieve commercialization of our candidate products
                                         or profitability;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">We
                                         are currently focused on the development of a single product candidate;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Clinical
                                         trials for our product candidate are expensive and time consuming, and their outcome
                                         is uncertain; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">We
                                         may not receive regulatory approvals for our product candidate or there may be a delay
                                         in obtaining such approvals.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Company
Information</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are a Nevada corporation formed on June 24, 2009 under the name Berry Only Inc. On January 25, 2013, we entered into and closed
an exchange agreement (the &ldquo;Exchange Agreement&rdquo;), with Del Mar Pharmaceuticals (BC) Ltd. (&ldquo;Del Mar (BC)&rdquo;),
0959454 B.C. Ltd. (&ldquo;Callco&rdquo;), and 0959456 B.C. Ltd. (&ldquo;Exchangeco&rdquo;) and the security holders of Del Mar
(BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of ours (the &ldquo;Reverse Acquisition&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010, which is a clinical
stage company with a focus on the development of drugs for the treatment of cancer. We are also the parent company to Callco and
Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
principal executive offices are located at Suite 720-999 West Broadway, Vancouver, British Columbia, Canada V5Z 1K5 and our telephone
number is (604) 629-5989. We maintain an internet website at <I>www.delmarpharma.com</I>. We do not incorporate the information
on our website into this prospectus and you should not consider it part of this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

</DIV>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<DIV STYLE="padding: 5; border: Black 1.5pt solid; width: 98%">

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; text-transform: uppercase"><B><A NAME="a_002"></A>the
Offering</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif; text-transform: uppercase"><B>&nbsp;</B></FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; border-collapse: collapse">
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 45%; padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Securities
    to be Offered by the Selling Stockholders</FONT></TD>
    <TD STYLE="width: 55%; padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Up to 760,500
    shares of common stock issuable upon exercise of outstanding warrants.</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use of Proceeds</FONT></TD>
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
    proceeds from the sale of the shares of common stock under this prospectus will be for the account of the selling stockholders.
    We will not receive any proceeds from the sale of our shares of common stock offered pursuant to this prospectus. Any net
    proceeds received by us from the exercise of the warrants will be used for our clinical trials and for general corporate purposes,
    which may include working capital, capital expenditures, research and development and other commercial expenditures. In addition,
    we may use the net proceeds from this offering for investments in businesses, products or technologies that are complementary
    to our business. Pending these uses, we intend to invest the funds in short-term, investment grade, interest-bearing securities.
    It is possible that, pending their use, we may invest the net proceeds in a way that does not yield a favorable, or any, return
    for us. See the section entitled &ldquo;Use of Proceeds&rdquo; in this prospectus.</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Risk Factors</FONT></TD>
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">You should read the
    section entitled &ldquo;Risk Factors&rdquo; in this prospectus for a discussion of the factors to consider carefully before
    deciding to invest in shares of our common stock.</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nasdaq Capital Market
    Symbol</FONT></TD>
    <TD STYLE="padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DMPI</FONT></TD></TR>
</TABLE>
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</DIV>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_003"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>RISK
FACTORS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Investing
in our securities involves a high degree of risk. In determining whether to purchase our common stock, an investor should carefully
consider all of the material risks described below, together with the other information contained in this report before making
a decision to purchase our securities. An investor should only purchase our securities if he or she can afford to suffer the loss
of his or her entire investment.</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Risks
Related to Our Business</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
have expressed substantial doubt about our ability to continue as a going concern.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
discussed in Note 1 to the consolidated financial statements for the year ended June 30, 2018, our audited financial statements
for the fiscal year ended June 30, 2018, include an explanatory paragraph that such financial statements were prepared assuming
that we will continue as a going concern. A going concern basis assumes that we will continue our operations for the foreseeable
future and contemplates the realization of assets and the settlement of liabilities in the normal course of business.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the year ended June 30, 2018 and the nine months ended March 31, 2019, we reported a loss of $11,138,312 and $5,465,486, respectively,
and a negative cash flow from operations of $9,850,850 and $4,514,674, respectively. We had an accumulated deficit of $57,988,567
as at March 31, 2019. As at March 31, 2019, we had cash and cash equivalents on hand of $2,152,233. We are in the development
stage and have not generated any revenues to date. We do not have the prospect of achieving revenues until such time that our
product candidate is commercialized, or partnered, which may not ever occur. In the near future, we will require additional funding
to maintain our clinical studies, research and development projects, and for general operations. These circumstances indicate
substantial doubt exists about our ability to continue as a going concern.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consequently,
management is pursuing various financing alternatives to fund our operations so it can continue as a going concern. Management
plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership arrangements.
We may tailor our drug candidate development program based on the amount of funding we are able to raise in the future. Nevertheless,
there is no assurance that these initiatives will be successful.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should we be unable to continue as a going concern. Such adjustments could be material.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
have a limited operating history and a history of operating losses and expect to incur significant additional operating losses.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are an early stage company and there is limited historical financial information upon which to base an evaluation of our performance.
Our prospects must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered by companies
in their early stages of operations. We expect to incur substantial additional net expenses over the next several years as our
research, development and commercial activities increase. The amount of future losses and when, if ever, we will achieve profitability
are uncertain. Our ability to generate revenue and achieve profitability will depend on, among other things, successful completion
of the preclinical and clinical development of our product candidate; obtaining necessary regulatory approvals from the FDA and
international regulatory agencies; successful manufacturing, sales and marketing arrangements; and raising sufficient funds to
finance our activities. If we are unsuccessful at some or all of these undertakings, our business, prospects and results of operations
may be materially adversely affected.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
will need to raise additional capital, which may cause dilution to our stockholders, restrict our operations or require us to
relinquish rights to technologies or product candidates.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Until
such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination
of public or private equity offerings, debt financings and/or license and development agreements with collaboration partners.
As of March 31, 2019, we had cash and cash equivalents to fund operations into the middle of calendar 2019. We expect the net
proceeds from the Right Offering to be $1.2&nbsp;million assuming all of the securities are sold and subject to revocation rights,
which, together with the net proceeds from the RD Offering of approximately $3.2 million, we expect to fund our operations until
into the first quarter of calendar 2020. We will also need to raise additional capital to fund our operations. We do not have
any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible
debt securities, then-existing stockholders&rsquo; interests may be materially diluted, and the terms of such securities could
include liquidation or other preferences that adversely affect their rights as common stockholders. Debt financing and preferred
equity financing, if available, may involve agreements that include restrictive covenants that limit our ability to take specified
actions, such as incurring additional debt, making capital expenditures or declaring dividends. In addition, debt financing would
result in fixed payment obligations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, we have retained Oppenheimer &amp; Co. Inc. as a financial advisor to assist us in our evaluation of a broad range of
strategic alternatives to enhance stockholder value, including additional capital raising transactions, an acquisition, merger,
business combination, licensing and/or other strategic transaction involving us. There is no assurance that the review of strategic
alternatives will result in us changing our business plan, pursuing any particular transaction, or, if we pursue any such transaction,
that it will be completed. We do not expect to make further public comment regarding the strategic review until our Board of Directors
has approved a specific transaction or otherwise deems disclosure of significant developments is appropriate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">If
we raise funds through collaborations, strategic partnerships or marketing, distribution or licensing arrangements with third
parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates
or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt
financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization
efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.</FONT></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Our
inability to obtain additional financing could adversely affect our ability to meet our obligations under our planned clinical
studies and could negatively impact the timing of our clinical results.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
ability to meet our obligations and continue the research and development of our product candidate is dependent on our ability
to continue to raise adequate financing. We may not be successful in obtaining such additional financing in the amount required
at any time, or for any period, or, if available, that it can be obtained on terms satisfactory to us. In the event that we are
unable to obtain such additional financing, we may be unable to meet our obligations under our planned clinical studies and we
may have to tailor our drug candidate development programs based on the amount of funding we raise which could negatively impact
the timing of our clinical results. In addition, we could be required to cease our operations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Our
exploration and pursuit of strategic alternatives may not be successful.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
September 2018, we announced that we had retained Oppenheimer &amp; Co. Inc. as a financial advisor to assist us in our evaluation
of a broad range of strategic alternatives. Potential strategic alternatives that may be explored or evaluated as part of this
process include the potential for capital raising transactions, an acquisition, merger, business combination, licensing and/or
other strategic transaction involving us. Despite devoting efforts to identify and evaluate potential strategic transactions,
the process may not result in any definitive offer to consummate a strategic transaction, or, if we receive such a definitive
offer, the terms may not be as favorable as anticipated or may not result in the execution or approval of a definitive agreement.
Even if we enter into a definitive agreement, we may not be successful in completing a transaction or, if we complete such a transaction,
it may not enhance stockholder value or deliver expected benefits.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we fail to regain compliance with the stockholders&rsquo; equity requirements of The Nasdaq Capital Market LLC (&ldquo;Nasdaq&rdquo;)
or other requirements for continued listing, our common stock may be delisted and the price of our common stock and our ability
to access the capital markets could be negatively impacted.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
common stock is listed for trading on The Nasdaq Capital Market. On May 22, 2019 and May 23, 2019, we received written notices
(collectively, the &ldquo;Notice&rdquo;) from the Listing Qualifications Department of The Nasdaq Stock Market LLC (&ldquo;The
Nasdaq Stock Market&rdquo;) indicating that, in light of our having reported stockholders&rsquo; equity of $1,259,161 as of March
31, 2019 in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, we were not in compliance with the $2,500,000
minimum stockholders&rsquo; equity requirement set forth in Nasdaq Listing Rule 5550(b)(1) for continued listing on Nasdaq (the
&ldquo;Stockholders&rsquo; Equity Requirement&rdquo;), or with any alternative standard under the Nasdaq Listing Rules. The Notice
requested that we present a plan to regain compliance with the above-mentioned deficiency by written submission no later than
May 29, 2019, which plan was submitted on such date, in order to be considered by the Nasdaq Hearings Panel that was, until May
23, 2019, considering our continued listing due to our previous deficiency with respect to the $1.00 per share bid price requirement,
as described below. On June 13, 2019, the Nasdaq Hearings Panel issued a decision granting our request for continued listing,
subject to the condition that on or before October 15, 2019, we shall have issued public disclosure on Form 8-K that we have met
the Stockholders&rsquo; Equity Requirement and have demonstrated compliance with all other requirements for continued listing. We expect to utilize the proceeds from the Rights Offering and the RD Offering towards establishing
compliance with such requirement; provided that we will need to raise additional capital to obtain compliance.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
previously disclosed, on June 28, 2018, the Staff of the Listing Qualifications Department of The Nasdaq Stock Market (the &ldquo;Nasdaq
Staff&rdquo;) notified the Company that it did not comply with the minimum $1.00 per share bid price requirement for continued
listing, as set forth in Nasdaq Listing Rule 5550(a)(2) (the &ldquo;Bid Price Requirement&rdquo;), and we were therefore granted
180 calendar days, through December 26, 2018, to regain compliance. On December 27, 2018, the Nasdaq Staff notified us that we
had not regained compliance with the Bid Price Requirement, that our stockholders&rsquo; equity as reported in our Quarterly Report
on Form 10-Q for the quarter ended September 30, 2018 did not qualify us for an additional 180 calendar day extension period for
compliance and that we would therefore be subject to delisting unless we requested a hearing before a Nasdaq Hearings Panel. Accordingly,
we requested a hearing, which was held on January 31, 2019, at which we presented our plan of compliance. On February 4, 2019,
the Nasdaq Hearings Panel issued a decision granting our request for continued listing of our common stock on The Nasdaq Capital
Market pursuant to an extension through June 25, 2019, subject to the condition that we shall have demonstrated a closing bid
price of $1.00 per share or more for a minimum of ten consecutive business days by June 25, 2019. As a result of our previously
disclosed one-for-ten reverse stock split effected on May 8, 2019, on May 23, 2019, we received written notice from Nasdaq that
the Company has regained compliance with the Bid Price Requirement.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Subject
to our issuance of public disclosure on Form 8-K that we have meet the Stockholders&rsquo; Equity Requirement and our demonstrating
compliance for continued listing, our common stock will continue to be listed on Nasdaq, and our common
stock will continue to trade under the symbol &ldquo;DMPI.&rdquo; Our receipt of the Notice does not affect our business, operations
or reporting requirements with the SEC.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Notwithstanding,
there can be no assurance that we will be able to regain compliance, and if we are unable to regain compliance with the Stockholders&rsquo;
Equity Requirement, or if we fail to meet any of the other continued listing requirements, our securities may be delisted from
Nasdaq, which could reduce the liquidity of our common stock materially and result in a corresponding material reduction in the
price of our common stock. In addition, delisting could harm our ability to raise capital through alternative financing sources
on terms acceptable to us, or at all, and may result in the potential loss of confidence by investors, employees and business
development opportunities. Such a delisting likely would impair your ability to sell or purchase our common stock when you wish
to do so. Further, if we were to be delisted from Nasdaq, our common stock may no longer be recognized as a &ldquo;covered security&rdquo;
and we would be subject to regulation in each state in which we offer our securities. Thus, delisting from Nasdaq could adversely
affect our ability to raise additional financing through the public or private sale of equity securities, would significantly
impact the ability of investors to trade our securities and would negatively impact the value and liquidity of our common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we are unable to effectively implement or maintain a system of internal control over financial reporting, we may not be able to
accurately or timely report our financial results and our stock price could be adversely affected.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Section
404 of the Sarbanes-Oxley Act of 2002 and related regulations require us to evaluate the effectiveness of our internal control
over financial reporting as of the end of each fiscal year, and to include a management report assessing the effectiveness of
our internal control over financial reporting in our Annual Report on Form 10-K for that fiscal year. Management determined that
as of June 30, 2018 and in past periods, our disclosure controls and procedures and internal control over financial reporting
were not effective due to material weaknesses in our internal control over financial reporting related to our limited number of
employees in our accounting department and inadequate segregation of duties over authorization, review and recording of transactions,
as well as the financial reporting of such transactions. Any failure to implement new or improved controls necessary to remedy
the material weaknesses described above, or difficulties encountered in the implementation or operation of these controls, could
harm our operations, decrease the reliability of our financial reporting, and cause us to fail to meet our financial reporting
obligations, which could adversely affect our business and reduce our stock price.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
are an early-stage company and may never achieve commercialization of our candidate products or profitability.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are at an early stage of development and commercialization of our technologies and product candidate. We have not yet begun to
market any products and, accordingly, have not begun or generate revenues from the commercialization of our product. Our product
will require significant additional clinical testing and investment prior to commercialization. A commitment of substantial resources
by ourselves and, potentially, our partners to conduct time-consuming research and clinical studies will be required if we are
to complete the development of our product candidate. There can be no assurance that our product candidate will meet applicable
regulatory standards, obtain required regulatory approvals, be capable of being produced in commercial quantities at reasonable
costs or be successfully marketed. Our product candidate is not expected to be commercially available for several years, if at
all.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
are currently focused on the development of a single product candidate.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
product development efforts are currently focused on a single product, VAL-083, for which we are researching multiple indications.
If VAL-083 fails to achieve clinical endpoints or exhibits unanticipated toxicity or if a superior product is developed by a competitor,
our prospects for obtaining regulatory approval and commercialization may be negatively impacted. In the long-term, we hope to
establish a pipeline of product candidates, and we have identified additional product candidates that we may be able to acquire
or license in the future. However, at this time we do not have any formal agreements granting us any rights to such additional
product candidates.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Even
if we are able to commercialize any product candidate that we develop, the product may become subject to unfavorable pricing regulations,
third-party payor reimbursement practices or healthcare reform initiatives that could harm our business.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
commercial success of our current or future product candidates will depend substantially, both domestically and abroad, on the
extent to which the costs of our product candidate will be paid by health maintenance, managed care, pharmacy benefit and similar
healthcare management organizations, or reimbursed by government health administration authorities (such as Medicare and Medicaid),
private health coverage insurers and other third-party payors. If reimbursement is not available, or is available only to limited
levels, we may not be able to successfully commercialize our products. Even if coverage is provided, the approved reimbursement
amount may not be high enough to allow us to establish and maintain pricing sufficient to realize a meaningful return on our investment.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
is significant uncertainty related to third-party payor coverage and reimbursement of newly approved drugs. Marketing approvals,
pricing and reimbursement for new drug products vary widely from country to country. Some countries require approval of the sale
price of a drug before it can be marketed. In many countries, the pricing review period begins after marketing or product licensing
approval is granted. In some non-U.S. markets, prescription pharmaceutical pricing remains subject to continuing governmental
control even after initial approval is granted. As a result, we might obtain marketing approval for a product in a particular
country, but then be subject to price regulations that delay commercial launch of the product, possibly for lengthy time periods,
which may negatively impact the revenues we are able to generate from the sale of the product in that country. Adverse pricing
limitations may hinder our ability to recoup our investment in one or more product candidates, even if our product candidates
obtain marketing approval.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
ability to commercialize VAL-083 or any other product candidates will depend in part on the extent to which coverage and reimbursement
for these products and related treatments will be available from government health administration authorities, private health
insurers and other organizations. Government authorities and third-party payors, such as private health insurers and health maintenance
organizations, decide which medications they will cover and establish reimbursement levels. The healthcare industry is acutely
focused on cost containment, both in the United States and elsewhere. Government authorities and third-party payors have attempted
to control costs by limiting coverage and the amount of reimbursement for particular medications, which could affect our ability
to sell our product candidate profitably. These payors may not view our products, if any, as cost-effective, and coverage and
reimbursement may not be available to our customers, or may not be sufficient to allow our products, if any, to be marketed on
a competitive basis. Cost-control initiatives could cause us to decrease the price we might establish for products, which could
result in lower than anticipated product revenues. If the prices for our products, if any, decrease or if governmental and other
third-party payors do not provide adequate coverage or reimbursement, our prospects for revenue and profitability will suffer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
may also be delays in obtaining coverage and reimbursement for newly approved drugs, and coverage may be more limited than the
indications for which the drug is approved by the FDA or comparable non-U.S. regulatory authorities. Moreover, eligibility for
reimbursement does not imply that any drug will be paid for in all cases or at a rate that covers our costs, including research,
development, manufacture, sale and distribution. Reimbursement rates may vary, by way of example, according to the use of the
drug and the clinical setting in which it is used. Reimbursement rates may also be based on reimbursement levels already set for
lower cost drugs or may be incorporated into existing payments for other services.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, increasingly, third-party payors are requiring higher levels of evidence of the benefits and clinical outcomes of new
technologies and are challenging the prices charged. We cannot be sure that coverage will be available for any product candidate
that we, or they, commercialize and, if available, that the reimbursement rates will be adequate. Further, the net reimbursement
for drug products may be subject to additional reductions if there are changes to laws that presently restrict imports of drugs
from countries where they may be sold at lower prices than in the United States. An inability to promptly obtain coverage and
adequate payment rates from both government-funded and private payors for any of our product candidates for which we obtain marketing
approval could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize products
and our overall financial condition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
are dependent on obtaining certain patents and protecting our proprietary rights.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
success will depend, in part, on our ability to obtain patents, maintain trade secret protection and operate without infringing
on the proprietary rights of third parties or having third parties circumvent our rights. We have filed and are actively pursuing
patent applications for our products. The patent positions of biotechnology, biopharmaceutical and pharmaceutical companies can
be highly uncertain and involve complex legal and factual questions. Thus, there can be no assurance that any of our patent applications
will result in the issuance of patents, that we will develop additional proprietary products that are patentable, that any patents
issued to us or those that already have been issued will provide us with any competitive advantages or will not be challenged
by any third parties, that the patents of others will not impede our ability to do business or that third parties will not be
able to circumvent our patents. Furthermore, there can be no assurance that others will not independently develop similar products,
duplicate any of our products not under patent protection, or, if patents are issued to us, design around the patented products
we developed or will develop.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
may be required to obtain licenses from third parties to avoid infringing patents or other proprietary rights. No assurance can
be given that any licenses required under any such patents or proprietary rights would be made available, if at all, on terms
we find acceptable. If we do not obtain such licenses, we could encounter delays in the introduction of products or could find
that the development, manufacture or sale of products requiring such licenses could be prohibited.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
number of pharmaceutical, biopharmaceutical and biotechnology companies and research and academic institutions have developed
technologies, filed patent applications or received patents on various technologies that may be related to or affect our business.
Some of these technologies, applications or patents may conflict with our technologies or patent applications. Such conflict could
limit the scope of the patents, if any, that we may be able to obtain or result in the denial of our patent applications. In addition,
if patents that cover our activities are issued to other companies, there can be no assurance that we would be able to obtain
licenses to these patents at a reasonable cost or be able to develop or obtain alternative technology. If we do not obtain such
licenses, we could encounter delays in the introduction of products, or could find that the development, manufacture or sale of
products requiring such licenses could be prohibited. In addition, we could incur substantial costs in defending ourselves in
suits brought against us on patents it might infringe or in filing suits against others to have such patents declared invalid.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Patent
applications in the U.S. are maintained in secrecy and not published if either: i) the application is a provisional application
or ii) the application is filed and we request no publication, and certify that the invention disclosed &ldquo;has not and will
not&rdquo; be the subject of a published foreign application. Otherwise, U.S. applications or foreign counterparts, if any, publish
18 months after the priority application has been filed. Since publication of discoveries in the scientific or patent literature
often lag behind actual discoveries, we cannot be certain that we or any licensor were the first creator of inventions covered
by pending patent applications or that we or such licensor was the first to file patent applications for such inventions. Moreover,
we might have to participate in interference proceedings declared by the U.S. Patent and Trademark Office to determine priority
of invention, which could result in substantial cost to us, even if the eventual outcome were favorable to us. There can be no
assurance that our patents, if issued, would be held valid or enforceable by a court or that a competitor&rsquo;s technology or
product would be found to infringe such patents.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Moreover,
we may be subject to third-party preissuance submissions of prior art to the USPTO, or become involved in opposition, derivation,
reexamination, <I>inter partes</I> review, post-grant review or interference proceedings challenging our patent rights or the
patent rights of others. An adverse determination in any such submission, proceeding or litigation could reduce the scope of,
or invalidate, our patent rights, allow third parties to commercialize our technology or products and compete directly with us,
without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent
rights.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Even
if our patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection,
prevent competitors from competing with us, or otherwise provide us with any competitive advantage. Our competitors may be able
to circumvent our patents by developing similar or alternative technologies or products in a non-infringing manner.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our patents may be challenged
in courts or patent offices in the United States and abroad. Such challenges may result in loss of exclusivity or freedom to operate,
or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop
others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection
of our technology and products. Given the amount of time required for the development, testing and regulatory review of new product
candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result,
our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products
similar or identical to ours.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, the protection of intellectual property rights in China (where our clinical product candidate, VAL-083, is manufactured
pursuant to a collaboration agreement with the only manufacturer presently licensed by the CFDA to manufacture VAL-083 for the
China market, and where VAL-083 is approved for the treatment of CML and lung cancer) is relatively weak compared to the United
States, which may negatively affect our ability to generate royalty revenue from sales of VAL-083 in China.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Much
of our know-how and technology may not be patentable. To protect our rights, we require employees, consultants, advisors and collaborators
to enter into confidentiality agreements. There can be no assurance, however, that these agreements will provide meaningful protection
for our trade secrets, know-how or other proprietary information in the event of any unauthorized use or disclosure. Further,
our business may be adversely affected by competitors who independently develop competing technologies, especially if we obtain
no, or only narrow, patent protection.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may be unable to protect our patents and proprietary rights</I></B><I>.</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
future success will depend to a significant extent on our ability to:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">obtain
                                         and keep patent protection for our products and technologies on an international basis;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">enforce
                                         our patents to prevent others from using our inventions;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">maintain and prevent others from
                                    using our trade secrets; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">operate and commercialize products
                                    without infringing on the patents or proprietary rights of others.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
can provide no assurance that our patent rights will afford any competitive advantages and these rights may be challenged or circumvented
by third parties. Further, patents may not be issued on any of our pending patent applications in the U.S. or abroad. Because
of the extensive time required for development, testing and regulatory review of a product candidate, it is possible that before
a product candidate can be commercialized, any related patent may expire, or remain in existence for only a short period following
commercialization, reducing or eliminating any advantage of the patent.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">If
we sue others for infringing our patents, a court may determine that such patents are invalid or unenforceable. Even if the validity
of our patent rights is upheld by a court, a court may not prevent the alleged infringement of our patent rights on the grounds
that such activity is not covered by our patent claims.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, third parties may sue us for infringing their patents. In the event of a successful claim of infringement against us,
we may be required to:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">defend litigation or administrative
                                    proceedings;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">pay substantial damages;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">stop using our technologies and
                                    methods;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">stop certain research and development
                             efforts;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">develop non-infringing products or methods;
                             and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">obtain
                                         one or more licenses from third parties.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">If
required, we can provide no assurance that we will be able to obtain such licenses on acceptable terms, or at all. If we are sued
for infringement, we could encounter substantial delays in development, manufacture and commercialization of our product candidates.
Any litigation, whether to enforce our patent rights or to defend against allegations that we infringe third-party rights, will
be costly, time consuming, and may distract management from other important tasks.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
is commonplace in the biotechnology and pharmaceutical industry, we employ individuals who were previously employed at other biotechnology
or pharmaceutical companies, including our competitors or potential competitors. To the extent our employees are involved in research
areas which are similar to those areas in which they were involved at their former employers, we may be subject to claims that
such employees and/or we have inadvertently or otherwise used or disclosed the alleged trade secrets or other proprietary information
of the former employers. Litigation may be necessary to defend against such claims, which could result in substantial costs and
be a distraction to management and which may have a material adverse effect on us, even if we are successful in defending such
claims.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
are subject to various government regulations.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
manufacture and sale of human therapeutic and diagnostic products in the U.S., Canada and foreign jurisdictions are governed by
a variety of statutes and regulations. These laws require approval of manufacturing facilities, controlled research and testing
of products and government review and approval of a submission containing manufacturing, preclinical and clinical data in order
to obtain marketing approval based on establishing the safety and efficacy of the product for each use sought, including adherence
to current cGMP during production and storage, and control of marketing activities, including advertising and labeling.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">VAL-083
and any other products we may develop will require significant development, preclinical and clinical testing and investment of
substantial funds prior to its commercialization. The process of obtaining required approvals can be costly and time-consuming,
and there can be no assurance that we will successfully develop any future products that will prove to be safe and effective in
clinical studies or receive applicable regulatory approvals. Markets other than the U.S. and Canada have similar restrictions.
Potential investors and shareholders should be aware of the risks, problems, delays, expenses and difficulties which we may encounter
in view of the extensive regulatory environment which controls our business.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may request priority review for our product candidate in the future. The FDA may not grant priority review for our product candidate.
Moreover, even if the FDA designated such product for priority review, that designation may not lead to a faster regulatory review
or approval process and, in any event, would not assure FDA approval.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
may be eligible for priority review designation for our product candidate if the FDA determines such product candidate offers
major advances in treatment or provides a treatment where no adequate therapy exists. A priority review designation means that
the goal for the FDA to review an application is six months, rather than the standard review period of ten months. The FDA has
broad discretion with respect to whether or not to grant priority review status to a product candidate, so even if we believe
a particular product candidate is eligible for such designation or status, the FDA may decide not to grant it. Thus, while the
FDA has granted priority review to other oncology disease products, our product candidate, should we determine to seek priority
review, may not receive similar designation. Moreover, even if our product candidate is designated for priority review, such a
designation does not necessarily mean a faster regulatory review process or necessarily confer any advantage with respect to approval
compared to conventional FDA procedures. Receiving priority review from the FDA does not guarantee approval within an accelerated
timeline or thereafter.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
believe we may in some instances be able to secure approval from the FDA or comparable non-U.S. regulatory authorities to use
accelerated development pathways. If we are unable to obtain such approval, we may be required to conduct additional preclinical
studies or clinical studies beyond those that we contemplate, which could increase the expense of obtaining, and delay the receipt
of, necessary marketing approvals.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
anticipate that we may seek an accelerated approval pathway for our product candidate. Under the accelerated approval provisions
in the Federal Food, Drug, and Cosmetic Act, or FDCA, and the FDA&rsquo;s implementing regulations, the FDA may grant accelerated
approval to a product designed to treat a serious or life-threatening condition that provides meaningful therapeutic benefit over
available therapies upon a determination that the product has an effect on a surrogate endpoint or intermediate clinical endpoint
that is reasonably likely to predict clinical benefit. The FDA considers a clinical benefit to be a positive therapeutic effect
that is clinically meaningful in the context of a given disease, such as irreversible morbidity or mortality. For the purposes
of accelerated approval, a surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign,
or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. An intermediate
clinical endpoint is a clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality that
is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit. The accelerated approval
pathway may be used in cases in which the advantage of a new drug over available therapy may not be a direct therapeutic advantage,
but is a clinically important improvement from a patient and public health perspective. If granted, accelerated approval is usually
contingent on the sponsor&rsquo;s agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to
verify and describe the drug&rsquo;s clinical benefit. If such post-approval studies fail to confirm the drug&rsquo;s clinical
benefit, the FDA may withdraw its approval of the drug.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Prior
to seeking such accelerated approval, we will seek feedback from the FDA and will otherwise evaluate our ability to seek and receive
such accelerated approval. There can also be no assurance that after our evaluation of the feedback and other factors we will
decide to pursue or submit a New Drug Application (&ldquo;NDA&rdquo;), for accelerated approval or any other form of expedited
development, review or approval. Similarly, there can be no assurance that after subsequent FDA feedback that we will continue
to pursue or apply for accelerated approval or any other form of expedited development, review or approval, even if we initially
decide to do so. Furthermore, if we decide to submit an application for accelerated approval or under another expedited regulatory
designation (e.g., breakthrough therapy designation), there can be no assurance that such submission or application will be accepted
or that any expedited development, review or approval will be granted on a timely basis, or at all. The FDA or other non-U.S.
authorities could also require us to conduct further studies prior to considering our application or granting approval of any
type. A failure to obtain accelerated approval or any other form of expedited development, review or approval for any of our product
candidates that we determine to seek accelerated approval for would result in a longer time period to commercialization of such
product candidate, could increase the cost of development of such product candidate and could harm our competitive position in
the marketplace.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
have conducted, and may in the future conduct, clinical studies for certain of our product candidates at sites outside the United
States, and the FDA may not accept data from studies conducted in such locations.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have conducted and may in the future choose to conduct one or more of our clinical studies outside the United States. Although
the FDA may accept data from clinical studies conducted outside the United States, acceptance of this data is subject to certain
conditions imposed by the FDA. For example, the clinical study must be well designed and conducted and performed by qualified
investigators in accordance with ethical principles. The study population must also adequately represent the U.S. population,
and the data must be applicable to the U.S. population and U.S. medical practice in ways that the FDA deems clinically meaningful.
Generally, the patient population for any clinical studies conducted outside of the United States must be representative of the
population for whom we intend to seek approval in the United States. In addition, while these clinical studies are subject to
the applicable local laws, FDA acceptance of the data will be dependent upon its determination that the studies also complied
with all applicable U.S. laws and regulations. There can be no assurance that the FDA will accept data from studies conducted
outside of the United States. If the FDA does not accept the data from any of our clinical studies that we determine to conduct
outside the United States, it would likely result in the need for additional studies, which would be costly and time-consuming
and delay or permanently halt our development of the product candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, the conduct of clinical studies outside the United States could have a significant impact on us. Risks inherent in conducting
international clinical studies include:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left">&#9679;</TD><TD>foreign regulatory requirements that could restrict or
limit our ability to conduct our clinical studies;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left">&#9679;</TD><TD>administrative burdens of conducting clinical studies under
multiple foreign regulatory schema;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left">&#9679;</TD><TD>foreign exchange fluctuations; and</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left">&#9679;</TD><TD>diminished protection of intellectual property in some
countries.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
our clinical studies fail to demonstrate safety and efficacy to the satisfaction of the FDA and comparable non-U.S. regulators,
we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization
of our product candidate.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are not permitted to commercialize, market, promote or sell any product candidate in the United States without obtaining marketing
approval from the FDA. Comparable non-U.S. regulatory authorities, such as the EMA, impose similar restrictions. We may never
receive such approvals. We must complete extensive preclinical development and clinical studies to demonstrate the safety and
efficacy of our product candidate in humans before we will be able to obtain these approvals.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Clinical
testing is expensive, difficult to design and implement, can take many years to complete and is inherently uncertain as to outcome.
We have not previously submitted an NDA to the FDA or similar drug approval filings to comparable non-U.S. regulatory authorities
for any product candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Any
inability to successfully complete preclinical and clinical development could result in additional costs to us and impair our
ability to generate revenues from product sales, regulatory and commercialization milestones and royalties. In addition, if (1)
we are required to conduct additional clinical studies or other testing of our product candidate beyond the studies and testing
that we contemplate, (2) we are unable to successfully complete clinical studies of our product candidate or other testing, (3)
the results of these studies or tests are unfavorable, uncertain or are only modestly favorable, or (4) there are unacceptable
safety concerns associated with our product candidate, we, in addition to incurring additional costs, may:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">be
delayed in obtaining marketing approval for our product candidates;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">not
obtain marketing approval at all;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">obtain
approval for indications or patient populations that are not as broad as we intended or desired;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">obtain
approval with labeling that includes significant use or distribution restrictions or significant safety warnings, including boxed
warnings;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">be
subject to additional post-marketing testing or other requirements; or</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">be
required to remove the product from the market after obtaining marketing approval.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we experience any of a number of possible unforeseen events in connection with clinical studies of our product candidates, potential
marketing approval or commercialization of our product candidates could be delayed or prevented.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
may experience numerous unforeseen events during, or as a result of, clinical studies that could delay or prevent marketing approval
of our product candidate, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">clinical studies of our product
                                    candidate may produce unfavorable or inconclusive results;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may decide, or regulators may require
                             us, to conduct additional clinical studies or abandon product development programs;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the number of patients required
                                    for clinical studies of our product candidate may be larger than we anticipate, patient enrollment
                                    in these clinical studies may be slower than we anticipate or participants may drop out of
                                    these clinical studies at a higher rate than we anticipate;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">data safety monitoring committees may
                             recommend suspension, termination or a clinical hold for various reasons, including concerns about
                             patient safety;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">regulators or IRBs may suspend
                                    or terminate the study or impose a clinical hold for various reasons, including noncompliance
                                    with regulatory requirements or concerns about patient safety;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">patients with serious, life-threatening
                             diseases included in our clinical studies may die or suffer other adverse medical events for reasons
                             that may not be related to our product candidate;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">participating patients may be
                                    subject to unacceptable health risks;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">patients may not complete clinical studies
                             due to safety issues, side effects, or other reasons;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">changes in regulatory requirements and
                             guidance may occur, which require us to amend clinical study protocols to reflect these changes;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our third-party contractors, including
                             those manufacturing our product candidate or components or ingredients thereof or conducting clinical
                             studies on our behalf, may fail to comply with regulatory requirements or meet their contractual
                             obligations to us in a timely manner or at all;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">regulators or institutional review boards,
                             or IRBs may not authorize us or our investigators to commence a clinical study or conduct a clinical
                             study at a prospective study site;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may experience delays in reaching
                             or fail to reach agreement on acceptable clinical study contracts or clinical study protocols with
                             prospective study sites;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">patients who enroll in a clinical
                                    study may misrepresent their eligibility to do so or may otherwise not comply with the clinical
                                    study protocol, resulting in the need to drop the patients from the clinical study, increase
                                    the needed enrollment size for the clinical study or extend the clinical study&rsquo;s duration;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may have to suspend or terminate
                             clinical studies of our product candidate for various reasons, including a finding that the participants
                             are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics
                             of a product candidate;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">regulators or IRBs may require that
                             we or our investigators suspend or terminate clinical research for various reasons, including noncompliance
                             with regulatory requirements or their respective standards of conduct, a finding that the participants
                             are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics
                             of the product candidate or findings of undesirable effects caused by a chemically or mechanistically
                             similar drug or drug candidate;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the FDA or comparable non-U.S. regulatory
                             authorities may fail to approve or subsequently find fault with the manufacturing processes or facilities
                             of third-party manufacturers with which we enter into agreements for clinical and commercial supplies;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the FDA or comparable non-U.S.
                                    regulatory authorities may disagree with our clinical study design or our interpretation of
                                    data from preclinical studies and clinical studies;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the supply or quality of raw materials
                             or manufactured product candidate or other materials necessary to conduct clinical studies of our
                             product candidate may be insufficient, inadequate, delayed, or not available at an acceptable cost,
                             or we may experience interruptions in supply; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the approval policies or regulations
                                    of the FDA or comparable non-U.S. regulatory authorities may significantly change in a manner
                                    rendering our clinical data insufficient to obtain marketing approval.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Product
development costs for us will increase if we experience delays in testing or pursuing marketing approvals and we may be required
to obtain additional funds to complete clinical studies and prepare for possible commercialization of our product candidate. We
do not know whether any preclinical tests or clinical studies will begin as planned, will need to be restructured or will be completed
on schedule, or at all. Significant preclinical or clinical study delays also could shorten any periods during which we may have
the exclusive right to commercialize our product candidate or allow our competitors to bring products to market before we do and
impair our ability to successfully commercialize our product candidate and may harm our business and results of operations. In
addition, many of the factors that cause, or lead to, clinical study delays may ultimately lead to the denial of marketing approval
of our product candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we experience delays or difficulties in the enrollment of patients in clinical studies, we may not achieve our clinical development
on our anticipated timeline, or at all, and our receipt of necessary regulatory approvals could be delayed or prevented.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
may not be able to initiate or continue clinical studies for VAL-083 or any other product candidate if we are unable to locate
and enroll a sufficient number of eligible patients to participate in clinical studies. Patient enrollment is a significant factor
in the timing of clinical studies, and is affected by many factors, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the size and nature of the patient population;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the
                                         severity of the disease under investigation;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the proximity of patients to clinical
                             sites;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the eligibility criteria for the study;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the design of the clinical study;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">efforts to facilitate timely
                                    enrollment;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">competing clinical studies; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">clinicians&rsquo; and patients&rsquo;
                                    perceptions as to the potential advantages and risks of the drug being studied in relation
                                    to other available therapies, including any new drugs that may be approved for the indications
                                    we are investigating.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
inability to enroll a sufficient number of patients for our clinical studies could result in significant delays or may require
us to abandon one or more clinical studies altogether. Enrollment delays in our clinical studies may result in increased development
costs for our product candidate, delay or halt the development of and approval processes for our product candidate and jeopardize
our ability to achieve our clinical development timeline and goals, including the dates by which we will commence, complete and
receive results from clinical studies. Enrollment delays may also delay or jeopardize our ability to commence sales and generate
revenues from our product candidate. Any of the foregoing could cause our value to decline and limit our ability to obtain additional
financing, if needed.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Positive
results in previous clinical studies of VAL-083 may not be replicated in future clinical studies, which could result in development
delays or a failure to obtain marketing approval.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Positive
results in previous clinical studies of VAL-083 may not be predictive of similar results in future clinical studies. Also, interim
results during a clinical study do not necessarily predict final results. A number of companies in the pharmaceutical and biotechnology
industries have suffered significant setbacks in late-stage clinical studies even after achieving promising results in early-stage
development. Accordingly, the results from the completed preclinical studies and clinical studies for VAL-083 may not be predictive
of the results we may obtain in later stage studies. Our clinical studies may produce negative or inconclusive results, and we
may decide, or regulators may require us, to conduct additional clinical studies. Moreover, clinical data are often susceptible
to varying interpretations and analyses, and many companies that believed their product candidates performed satisfactorily in
preclinical studies and clinical studies have nonetheless failed to obtain FDA or EMA, or other regulatory agency, approval for
their products.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>FDA
approval of VAL-083 or future product candidates may be denied.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
can be no assurance that the FDA will ultimately approve our NDA. The FDA may deny approval of VAL-083 for many reasons, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may be unable to demonstrate
                                    to the satisfaction of the FDA that our products are safe and effective for its intended uses;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the FDA may disagree with our
                                    interpretation of data from the clinical studies;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may be unable to demonstrate that
                             any clinical or other benefits our products outweigh any safety or other perceived risks; or</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may not be able to successfully
                                    address any other issues raised by the FDA.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">If
VAL-083 fails to receive FDA approval, our business and prospects will be materially adversely impacted.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
expect to rely on orphan drug status to develop and commercialize our product candidate, but our orphan drug designations may
not confer marketing exclusivity or other expected commercial benefits as anticipated.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Market
exclusivity afforded by orphan drug designation is generally offered as an incentive to drug developers to invest in developing
and commercializing products for unique diseases that impact a limited number of patients. The FDA may grant orphan drug designation
to drugs intended to treat a rare disease or condition, which is generally a disease or condition that affects fewer than 200,000
individuals in the United States. Qualification to maintain orphan drug status is generally monitored by the regulatory authorities
during the orphan drug exclusivity period, currently seven years from the date of approval in the United States.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have been granted orphan drug designation in the United States for GBM, ovarian cancer, and medulloblastoma, and in Europe for
GBM. We expect to rely on orphan drug exclusivity for our product candidate. It is possible that the incidence and prevalence
numbers for GBM could change. Should the incidence and prevalence of GBM patients materially increase, it is possible that the
orphan drug designation, and related market exclusivity, in the United States could be lost. Further, while we have been granted
this orphan designation, the FDA can still approve different drugs for use in treating the same indication or disease, which would
create a more competitive market for us and our revenues will be diminished.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Further,
it is possible that another company also holding orphan drug designation for the same product candidate will receive marketing
approval for the same indication before we do. If that were to happen, our applications for that indication may not be approved
until the competing company&rsquo;s period of exclusivity expires. Even if we are the first to obtain marketing authorization
for an orphan drug indication, there are circumstances under which a competing product may be approved for the same indication
during the seven-year period of marketing exclusivity, such as if the later product is shown to be clinically superior to the
orphan product, or if the later product is deemed a different product than ours. Further, the seven-year marketing exclusivity
would not prevent competitors from obtaining approval of the same product candidate as ours for indications other than those in
which we have been granted orphan drug designation, or for the use of other types of products in the same indications as our orphan
product.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
the market opportunities for our product candidate are smaller than we believe they are, our revenues may be adversely affected
and our business may suffer. Because the target patient populations of our product candidate are small, we must be able to successfully
identify patients and capture a significant market share to achieve and maintain profitability.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
focus our research and product development on treatments for orphan cancer indications. Our projections of both the number of
people who have failed other therapies or have limited medical options, are based on estimates. These estimates may prove to be
incorrect and new studies may change the estimated incidence or prevalence. The number of patients in the United States, Europe
and elsewhere may turn out to be lower than expected or may not be otherwise amenable to treatment with our products, or new patients
may become increasingly difficult to identify or gain access to, all of which would adversely affect our results of operations
and our business. Additionally, because our target patient populations are small, we will be required to capture a significant
market share to achieve and maintain profitability.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may be required to suspend or discontinue clinical studies due to unexpected side effects or other safety risks that could preclude
approval of our products.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
clinical studies may be suspended at any time for a number of reasons. For example, we may voluntarily suspend or terminate our
clinical studies if at any time we believe that they present an unacceptable risk to the clinical study patients. In addition,
the FDA or other regulatory agencies may order the temporary or permanent discontinuation of our clinical studies at any time
if they believe that the clinical studies are not being conducted in accordance with applicable regulatory requirements or that
they present an unacceptable safety risk to the clinical study patients.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Administering
any product candidate to humans may produce undesirable side effects. These side effects could interrupt, delay or halt clinical
studies of our product candidates and could result in the FDA or other regulatory authorities denying further development or approval
of our product candidates for any or all targeted indications. Ultimately, some or all of our product candidates may prove to
be unsafe for human use. Moreover, we could be subject to significant liability if any volunteer or patient suffers, or appears
to suffer, adverse health effects or even death as a result of participating in our clinical studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may not receive regulatory approvals for our product candidate or there may be a delay in obtaining such approvals.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
product and our ongoing development activities are subject to regulation by regulatory authorities in the countries in which we
or our collaborators and distributors wish to test, manufacture or market our products. For instance, the FDA will regulate the
product in the U.S. and equivalent authorities, such as the EMA, will regulate in Europe. Regulatory approval by these authorities
will be subject to the evaluation of data relating to the quality, efficacy and safety of the product for its proposed use, and
there can be no assurance that the regulatory authorities will find our data sufficient to support product approval of VAL-083
or any future product candidates.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
time required to obtain regulatory approval varies between countries. The FDA is required to facilitate the development and expedite
the review of drugs and biologics that are intended for the treatment of a serious or life-threatening disease or condition and
which demonstrate the potential to address unmet medical needs for the condition. Filling an unmet medical need is defined as
providing a therapy where none exists or providing a therapy that may be potentially better than available therapy. Under the
fast track program, the sponsor of a new drug or biologic candidate may request the FDA to designate the product for a specific
indication as a fast track product concurrent with or after the filing of the IND for the product candidate. The FDA must determine
if the product candidate qualifies for fast track designation within 60 days after receipt of the sponsor&rsquo;s request. In
the U.S., for products without &ldquo;Fast Track&rdquo; status, it can take over eighteen (18) months after submission of an application
for product approval to receive the FDA&rsquo;s decision. Even with Fast Track status, FDA review and decision can take over twelve
(12) months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
December 2017, the FDA granted Fast Track designation for VAL-083 in rGBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Different
regulators may impose their own requirements and may refuse to grant, or may require additional data before granting, an approval,
notwithstanding that regulatory approval may have been granted by other regulators. Regulatory approval may be delayed, limited
or denied for a number of reasons, including insufficient clinical data, the product not meeting safety or efficacy requirements
or any relevant manufacturing processes or facilities not meeting applicable requirements as well as case load at the regulatory
agency at the time.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may fail to comply with regulatory requirements.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
success will be dependent upon our ability, and our collaborative partners&rsquo; abilities, to maintain compliance with regulatory
requirements, including cGMP, and safety reporting obligations. The failure to comply with applicable regulatory requirements
can result in, among other things, fines, injunctions, civil penalties, total or partial suspension of regulatory approvals, refusal
to approve pending applications, recalls or seizures of products, operating and production restrictions and criminal prosecutions.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Even
if our product candidate receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients,
third-party payors and others in the medical community necessary for commercial success and the market opportunity for the product
candidate may be smaller than we estimate.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have never commercialized a product. Even if VAL-083 or any other product candidate is approved by the appropriate regulatory
authorities for marketing and sale, it may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party
payors and others in the medical community. For example, physicians are often reluctant to switch their patients from existing
therapies even when new and potentially more effective or convenient treatments enter the market. Further, patients often acclimate
to the therapy that they are currently taking and do not want to switch unless their physicians recommend switching products or
they are required to switch therapies due to lack of reimbursement for existing therapies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Efforts
to educate the medical community and third-party payors on the benefits of our product candidate may require significant resources
and may not be successful. If our product candidate is approved but does not achieve an adequate level of market acceptance, we
may not generate significant revenues and we may not become profitable. The degree of market acceptance of VAL-083 or any other
product candidate, if approved for commercial sale, will depend on a number of factors, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the efficacy and safety of the
                                    product;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the potential advantages of the product
                             compared to alternative treatments;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the prevalence and severity of any side
                             effects;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the clinical indications for
                                    which the product is approved;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">whether the product is designated
                                    under physician treatment guidelines as a first-line therapy or as a second- or third-line
                                    therapy;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">limitations or warnings, including distribution
                             or use restrictions, contained in the product&rsquo;s approved labeling;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to offer the product for
                             sale at competitive prices;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to establish and maintain
                             pricing sufficient to realize a meaningful return on our investment;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the product&rsquo;s convenience
                                    and ease of administration compared to alternative treatments;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the willingness of the target
                                    patient population to try, and of physicians to prescribe, the product;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the strength of sales, marketing and
                             distribution support;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the approval of other new products
                                    for the same indications;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">changes in the standard of care for
                             the targeted indications for the product;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the
                                         timing of market introduction of our approved products as well as competitive products
                                         and other therapies;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">availability and amount of reimbursement
                             from government payors, managed care plans and other third-party payors;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">adverse publicity about the product
                                    or favorable publicity about competitive products; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">potential product liability claims.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
potential market opportunities for our product candidate are difficult to estimate precisely. Our estimates of the potential market
opportunities are predicated on many assumptions, including industry knowledge and publications, third-party research reports
and other surveys. While we believe that our internal assumptions are reasonable, these assumptions involve the exercise of significant
judgment on the part of our management, are inherently uncertain and the reasonableness of these assumptions has not been assessed
by an independent source. If any of the assumptions proves to be inaccurate, the actual markets for our product candidate could
be smaller than our estimates of the potential market opportunities.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
our product candidate receives marketing approval and we, or others, later discover that the drug is less effective than previously
believed or causes undesirable side effects that were not previously identified, our ability to market the drug could be compromised.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Clinical
studies of our product candidate are conducted in carefully defined subsets of patients who have agreed to enter into clinical
studies. Consequently, it is possible that our clinical studies may indicate an apparent positive effect of a product candidate
that is greater than the actual positive effect, if any, or alternatively fail to identify undesirable side effects. If, following
approval of our product candidate, we, or others, discover that the drug is less effective than previously believed or causes
undesirable side effects that were not previously identified, any of the following adverse events could occur:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">regulatory authorities may withdraw
                             their approval of the drug or seize the drug;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may be required to recall the drug
                             or change the way the drug is administered;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">additional restrictions may be
                                    imposed on the marketing of, or the manufacturing processes for, the particular drug;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may be subject to fines, injunctions
                             or the imposition of civil or criminal penalties;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">regulatory authorities may require
                                    the addition of labeling statements, such as a &ldquo;black box&rdquo; warning or a contraindication;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we may be required to create a Medication
                             Guide outlining the risks of the previously unidentified side effects for distribution to patients;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">we could be sued and held liable
                                    for harm caused to patients;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the drug may become less competitive;
                             and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our reputation may suffer.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Any
of these events could have a material and adverse effect on our operations and business and could adversely impact our stock price.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT>&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Any
product candidate for which we obtain marketing approval, along with the manufacturing processes, qualification testing, post-approval
clinical data, labeling and promotional activities for such product, will be subject to continual and additional requirements
of the FDA and other regulatory authorities.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">These
requirements include submissions of safety and other post-marketing information, reports, registration and listing requirements,
good manufacturing practices, or GMP requirements relating to quality control, quality assurance and corresponding maintenance
of records and documents, and recordkeeping. Even if marketing approval of our product candidate is granted, the approval may
be subject to limitations on the indicated uses for which the product may be marketed or to conditions of approval, or contain
requirements for costly post-marketing testing and surveillance to monitor the safety or efficacy of the product. The FDA closely
regulates the post-approval marketing and promotion of pharmaceutical products to ensure such products are marketed only for the
approved indications and in accordance with the provisions of the approved labeling.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, later discovery of previously unknown problems with our products, manufacturing processes, or failure to comply with
regulatory requirements, may lead to various adverse results, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">restrictions on such products,
                                    manufacturers or manufacturing processes;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">restrictions on the labeling or marketing
                             of a product;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">restrictions on product distribution
                             or use;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">requirements to conduct post-marketing
                             clinical studies;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">requirements to institute a risk evaluation
                             mitigation strategy, or REMS, to monitor safety of the product post-approval;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">warning letters issued by the FDA or
                             other regulatory authorities;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">withdrawal of the products from the
                             market;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">refusal to approve pending applications
                             or supplements to approved applications that we submit;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">recall of products, fines, restitution
                                    or disgorgement of profits or revenue;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">suspension, revocation or withdrawal
                                    of marketing approvals;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">refusal to permit the import
                                    or export of our products; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">injunctions or the imposition of civil
                             or criminal penalties.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we are unable to establish sales, marketing and distribution capabilities or enter into acceptable sales, marketing and distribution
arrangements with third parties, we may not be successful in commercializing any product candidates that we develop, if and when
those product candidates are approved.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
do not have a sales, marketing or distribution infrastructure and have limited experience in the sale, marketing or distribution
of pharmaceutical products. To achieve commercial success for any approved product, we must either develop a sales and marketing
organization, outsource these functions to third parties, or license our product candidates to others. If approved, we may seek
to license VAL-083 to a large pharmaceutical company with greater resources and experience than us. We may not be able license
the VAL-083 on reasonable terms, if at all. The development of sales, marketing and distribution capabilities will require substantial
resources, will be time-consuming and could delay any product launch. We expect that we will commence the development of these
capabilities prior to receiving approval of our product candidate. If the commercial launch of a product candidate for which we
recruit a sales force and establish marketing and distribution capabilities is delayed or does not occur for any reason, we could
have prematurely or unnecessarily incurred these commercialization costs. Such a delay may be costly, and our investment could
be lost if we cannot retain or reposition our sales and marketing personnel. In addition, we may not be able to hire or retain
a sales force in the United States that is sufficient in size or has adequate expertise in the medical markets that we plan to
target. If we are unable to establish or retain a sales force and marketing and distribution capabilities, our operating results
may be adversely affected. If a potential partner has development or commercialization expertise that we believe is particularly
relevant to our product candidate, then we may seek to collaborate with that potential partner even if we believe we could otherwise
develop and commercialize the product independently.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
expect to seek one or more strategic partners for commercialization of our product candidate outside the United States. As a result
of entering into arrangements with third parties to perform sales, marketing and distribution services, our product revenues or
the profitability of these product revenues may be lower, perhaps substantially lower, than if we were to directly market and
sell products in those markets. Furthermore, we may be unsuccessful in entering into the necessary arrangements with third parties
or may be unable to do so on terms that are favorable to us. In addition, we may have little or no control over such third parties,
and any of them may fail to devote the necessary resources and attention to sell and market our products effectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">If
we do not establish sales and marketing capabilities, either on our own or in collaboration with third parties, we will not be
successful in commercializing our product candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
face substantial competition from other pharmaceutical and biotechnology companies and our operating results may suffer if we
fail to compete effectively.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
development and commercialization of new drug products is highly competitive. We expect that we will face significant competition
from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide with respect to
VAL-083 and any other product candidates that we may seek to develop or commercialize in the future. Specifically, due to the
large unmet medical need, global demographics and relatively attractive reimbursement dynamics, the oncology market is fiercely
competitive and there are a number of large pharmaceutical and biotechnology companies that currently market and sell products
or are pursuing the development of product candidates for the treatment of cancer. Our competitors may succeed in developing,
acquiring or licensing technologies and drug products that are more effective, have fewer or more tolerable side effects or are
less costly than any product candidates that we are currently developing or that we may develop, which could render our product
candidates obsolete and noncompetitive.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
of the top ten global pharmaceutical companies and many of the mid-size pharmaceutical companies have a strong research and development
and commercial presence in oncology. Smaller companies also focus on oncology, including companies such as ARIAD Pharmaceuticals,
Inc., Agios Pharmaceuticals, Inc., BIND Therapeutics, Inc., Clovis Oncology, Inc., Endocyte, Inc., Epizyme, Inc., ImmunoGen, Inc.,
Incyte Corporation, Infinity Pharmaceuticals, Inc., MacroGenics, Inc., Merrimack Pharmaceuticals, Inc., OncoMed Pharmaceuticals,
Inc., Onconova Therapeutics, Inc., Pharmacyclics, Inc., Puma Biotechnology, Inc., Seattle Genetics, Inc. and TESARO, Inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Several
companies are marketing and developing oncology immunotherapy products. Companies with approved marketed oncology products for
GBM are Merck (Temodar<SUP>&reg;</SUP>) and Genentech (Avastin<SUP>&reg;</SUP>). Companies with oncology immunotherapy product
candidates in clinical development include, but are not limited to, Northwest Biotherapeutics (DCVax-L), Celldex Therapeutics
(Rindopepimut (CDX-110)) and ImmunoCellular Therapeutics (ICT-107).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more
effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
Our competitors also may obtain FDA or other marketing approval for their products before we are able to obtain approval for ours,
which could result in our competitors establishing a strong market position before we are able to enter the market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Many
of our existing and potential future competitors have significantly greater financial resources and expertise in research and
development, manufacturing, preclinical testing, conducting clinical studies, obtaining marketing approvals and marketing approved
products than we do. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources
being concentrated among a smaller number of our competitors. Smaller or early stage companies may also prove to be significant
competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete
with us in recruiting and retaining qualified scientific and management personnel and establishing clinical study sites and patient
registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our programs.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we are unable to or delayed in obtaining state regulatory licenses for the distribution of our product, we would not be able to
sell our product candidate.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
majority of states require manufacturer and/or wholesaler licenses for the sale and distribution of drugs into that state. The
application process is complicated, time consuming and requires dedicated personnel or a third-party to oversee and manage. If
we are delayed in obtaining these state licenses, or denied the licenses, even with FDA approval, we would not be able to sell
or ship product into that state which would adversely affect our sales and revenues.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
rely on key personnel and, if we are unable to retain or motivate key personnel or hire qualified personnel, we may not be able
to grow effectively.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are dependent on certain members of our management, scientific and drug development staff and consultants, the loss of services
of one or more of whom could materially adversely affect us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
currently have two full-time employees, and retain the services of approximately 15 persons on an independent contractor/consultant
and contract-employment basis. Our ability to manage growth effectively will require us to continue to implement and improve our
management systems and to recruit and train new employees. Although we have done so in the past and expect to do so in the future,
there can be no assurance that we will be able to successfully attract and retain skilled and experienced personnel.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
success depends in large part upon our ability to attract and retain highly qualified personnel. We compete in our hiring efforts
with other pharmaceutical and biotechnology companies, as well as universities and nonprofit research organizations, and we may
have to pay higher salaries to attract and retain personnel, which would be very costly.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may be subject to foreign exchange fluctuation.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
functional and reporting currency is the United States dollar. We maintain bank accounts in United States and Canadian dollars.
A portion of our expenditures are in foreign currencies, most notably in Canadian dollars, and therefore we are subject to foreign
currency fluctuations, which may, from time to time, impact our financial position and results. We may enter into hedging arrangements
under specific circumstances, typically through the use of forward or futures currency contracts, to minimize the impact of increases
in the value of the Canadian dollar. In order to minimize our exposure to foreign exchange fluctuations we may hold sufficient
Canadian dollars to cover our expected Canadian dollar expenditures.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Product
liability lawsuits against us could divert our resources, cause us to incur substantial liabilities and limit commercialization
of any products that we may develop.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
face an inherent risk of product liability claims as a result of the clinical testing of our product candidate despite obtaining
appropriate informed consents from our clinical study participants. We will face an even greater risk if we commercially sell
any product that we may develop. For example, we may be sued if any product we develop allegedly causes injury or is found to
be otherwise unsuitable during clinical testing, manufacturing, marketing or sale. Any such product liability claims may include
allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, negligence,
strict liability or a breach of warranties. Claims could also be asserted under state consumer protection acts. If we cannot successfully
defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization
of our product candidate. Regardless of the merits or eventual outcome, liability claims may result in:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">decreased demand for our product candidate
                             or products that we may develop;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">injury to our reputation and
                                    significant negative media attention;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">withdrawal of clinical study
                                    participants;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">significant costs to defend resulting
                                    litigation;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">substantial monetary awards to study
                             participants or patients;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">loss of revenue;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">reduced resources of our management
                             to pursue our business strategy; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the inability to commercialize
                                    any products that we may develop.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Although
we maintain general liability insurance, this insurance may not fully cover potential liabilities that we may incur. The cost
of any product liability litigation or other proceeding, even if resolved in our favor, could be substantial. We will need to
increase our insurance coverage if and when we begin selling any product candidate that receives marketing approval. In addition,
insurance coverage is becoming increasingly expensive. If we are unable to obtain or maintain sufficient insurance coverage at
an acceptable cost or to otherwise protect against potential product liability claims, it could prevent or inhibit the development
and commercial production and sale of our product candidate, which could adversely affect our business, financial condition, results
of operations and prospects.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Risks
Related to Our Dependence on Third Parties</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
rely on third parties to conduct clinical studies for our product candidate. Any failure by a third-party to meet its obligations
with respect to the clinical development of our product candidate may delay or impair our ability to obtain regulatory approval
for our product candidate.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
rely on academic institutions and private oncology centers to conduct our clinical studies. Our reliance on third parties to conduct
clinical studies could, depending on the actions of such third parties, jeopardize the validity of the clinical data generated
and adversely affect our ability to obtain marketing approval from the FDA or other applicable regulatory authorities.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Such
clinical study arrangements provide us with information rights with respect to the clinical data, including access to and the
ability to use and reference the data, including for our own regulatory filings, resulting from the clinical studies. If investigators
or institutions breach their obligations with respect to the clinical studies of our product candidate, or if the data proves
to be inadequate, then our ability to design and conduct any future clinical studies may be adversely affected.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
rely, and expect to continue to rely, on third parties to conduct our clinical studies, and those third parties may not perform
satisfactorily, including failing to meet deadlines for the completion of such studies.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
currently rely on third-party clinical research organizations, or CROs, to conduct our clinical studies. We expect to continue
to rely on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators,
to conduct our clinical studies. Our agreements with these third parties generally allow the third-party to terminate the agreement
at any time. If we are required to enter into alternative arrangements because of any such termination the introduction of our
product candidates to market could be delayed.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
reliance on these third parties for research and development activities will reduce our control over these activities but will
not relieve us of our responsibilities. For example, we design our clinical studies and will remain responsible for ensuring that
each of our clinical studies are conducted in accordance with the general investigational plan and protocols for the study. Moreover,
the FDA requires us to comply with standards, commonly referred to as good clinical practices, or GCPs, for conducting, recording
and reporting the results of clinical studies to assure that data and reported results are credible and accurate and that the
rights, integrity and confidentiality of study participants are protected. Our reliance on third parties that we do not control
does not relieve us of these responsibilities and requirements. We also are required to register ongoing clinical studies and
post the results of completed clinical studies on a government-sponsored database, ClinicalTrials.gov, within specified timeframes.
Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Furthermore,
these third parties may also have relationships with other entities, some of which may be our competitors. If these third parties
do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical studies in accordance
with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, marketing
approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully commercialize
our product candidates.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
also expect to rely on other third parties to store and distribute drug supplies for our clinical studies. Any performance failure
on the part of our distributors could delay clinical development or marketing approval of our product candidate or commercialization
of our products, producing additional losses and depriving us of potential product revenue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may seek to enter into collaborations with third parties for the development and commercialization of our product candidate. If
we fail to enter into such collaborations, or such collaborations are not successful, we may not be able to capitalize on the
market potential of our product candidate.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
may seek third-party collaborators for development and commercialization of our product candidate. Our likely collaborators for
any marketing, distribution, development, licensing or broader collaboration arrangements include large and mid-size pharmaceutical
companies, regional and national pharmaceutical companies, non-profit organizations, government agencies, and biotechnology companies.
We are currently party to a limited number of such arrangements and have limited control over the amount and timing of resources
that our collaborators dedicate to the development or commercialization of our product candidate. Our ability to generate revenues
from these arrangements will depend on our collaborators&rsquo; abilities to successfully perform the functions assigned to them
in these arrangements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Collaborations
involving our product candidate currently pose, and will continue to pose, the following risks to us:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators have significant
                                    discretion in determining the efforts and resources that they will apply to these collaborations;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators may not pursue development
                             and commercialization of our product candidate or may elect not to continue or renew development
                             or commercialization programs based on preclinical or clinical study results, changes in the collaborators&rsquo;
                             strategic focus or available funding, or external factors such as an acquisition that diverts resources
                             or creates competing priorities;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators may delay clinical studies,
                             provide insufficient funding for a clinical study program, stop a clinical study or abandon a product
                             candidate, repeat or conduct new clinical studies or require a new formulation of a product candidate
                             for clinical testing;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators could independently
                                    develop, or develop with third parties, products that compete directly or indirectly with
                                    our product candidate if the collaborators believe that competitive products are more likely
                                    to be successfully developed or can be commercialized under terms that are more economically
                                    attractive than ours;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators with marketing
                                    and distribution rights to one or more products may not commit sufficient resources to the
                                    marketing and distribution of such product or products;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators may not properly maintain
                             or defend our intellectual property rights or may use our proprietary information in such a way as
                             to invite litigation that could jeopardize or invalidate our intellectual property or proprietary
                             information or expose us to potential litigation;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborators may infringe the intellectual
                             property rights of third parties, which may expose us to litigation and potential liability;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">disputes may arise between the collaborators
                             and us that result in the delay or termination of the research, development or commercialization
                             of our product candidate or that result in costly litigation or arbitration that diverts management
                             attention and resources; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">collaborations may be terminated and,
                             if terminated, may result in a need for additional capital to pursue further development or commercialization
                             of the applicable product candidates.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Collaboration
agreements may not lead to development or commercialization of our product candidate in the most efficient manner or at all. If
a collaborator of ours were to be involved in a business combination, the continued pursuit and emphasis on our product development
or commercialization program could be delayed, diminished or terminated.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>If
we are not able to establish collaborations, we may have to alter our development and commercialization plans.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
drug development programs and the potential commercialization of our product candidate will require substantial additional cash
to fund expenses. We may decide to collaborate with pharmaceutical and biotechnology companies for the development and potential
commercialization of our product candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
face significant competition in seeking appropriate collaborators. Whether we reach a definitive agreement for a collaboration
will depend, among other things, upon our assessment of the collaborator&rsquo;s resources and expertise, the terms and conditions
of the proposed collaboration and the proposed collaborator&rsquo;s evaluation of a number of factors. Those factors may include
the design or results of preclinical studies or clinical studies, the likelihood of approval by the FDA or similar regulatory
authorities outside the United States, the potential market for the subject product candidate, the costs and complexities of manufacturing
and delivering such product candidate to patients, the potential of competing products, the existence of uncertainty with respect
to our ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of the
challenge and industry and market conditions generally. The collaborator may also consider alternative product candidates or technologies
for similar indications that may be available to collaborate on and whether such a collaboration could be more attractive than
the one with us for our product candidate. We may also be restricted under future license agreements from entering into agreements
on certain terms with potential collaborators. Collaborations are complex and time-consuming to negotiate and document. In addition,
there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in
a reduced number of potential future collaborators.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
may not be able to negotiate collaborations on a timely basis, on acceptable terms, or at all. If we are unable to do so, we may
have to curtail the development of our product candidate, reduce or delay its development program, delay its potential commercialization
or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization
activities at our own expense. If we elect to increase our expenditures to fund development or commercialization activities on
our own, we may need to obtain additional capital, which may not be available to us on acceptable terms or at all. If we do not
have sufficient funds, we may not be able to further develop our product candidate or bring it to market and generate product
revenue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
currently manufacture our clinical supplies at a single location. Any disruption at this facility could adversely affect our business
and results of operations.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have engaged a single manufacturer to produce GMP active pharmaceutical ingredient and a single manufacturer to produce drug product
for our clinical studies. In addition, we have relied on our manufacturing partner, Guangxi Wuzhou Pharmaceutical Company, for
the manufacture of clinical supply of VAL-083 for our preclinical and Phase 2 clinical studies to-date. If our manufacturer&rsquo;s
facility were damaged or destroyed, or otherwise subject to disruption, it would require substantial lead-time to replace our
clinical supply. In such event, we would be forced to rely entirely on other third-party contract manufacturers for an indefinite
period of time. We do not currently have established relationships with any back-up manufacturers. At this time no drug product
has been manufactured by a third-party back-up manufacturer. Any disruptions or delays by our third-party manufacturers or Guangxi
Wuzhou Pharmaceutical Company or their failure to meet regulatory compliance could impair our ability to develop VAL-083, which
would adversely affect our business and results of operations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
rely on these third-party manufacturers to provide drug product supply for our clinical studies. There is no assurance that such
a supplier will be able to meet our needs from a technical, timing, or cost-effective manner. Our failure to enter into appropriate
agreements with such a third-party manufacturer would delay, or halt, our clinical studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
may become subject to liabilities related to risks inherent in working with hazardous materials.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
discovery and development processes involve the controlled use of hazardous and radioactive materials. We are subject to federal,
provincial and local laws and regulations governing the use, manufacture, storage, handling and disposal of such materials and
certain waste products. Although we believe that our safety procedures for handling and disposing of such materials comply with
the standards prescribed by such laws and regulations, the risk of accidental contamination or injury from these materials cannot
be completely eliminated. In the event of such an accident, we could be held liable for any damages that result and any such liability
could exceed our resources. We are not specifically insured with respect to this liability. Although we believe that we are in
compliance in all material respects with applicable environmental laws and regulations and currently do not expect to make material
capital expenditures for environmental control facilities in the near-term, there can be no assurance that we will not be required
to incur significant costs to comply with environmental laws and regulations in the future, or that our operations, business or
assets will not be materially adversely affected by current or future environmental laws or regulations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Risks
Related to Our Common Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>The
market price of our common stock is, and is likely to continue to be, highly volatile and subject to wide fluctuations.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
market price of our common stock is highly volatile and could be subject to wide fluctuations in response to a number of factors
that are beyond our control, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">variations in our quarterly operating
                             results;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">announcements that our revenue or income
                             are below analysts&rsquo; expectations;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">general economic slowdowns;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">sales of large blocks of our
                                    common stock; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">announcements by us or our competitors
                             of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Because
we became public by means of a reverse acquisition, we may not be able to attract, or maintain, the attention of brokerage firms.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Because
we became public through a &ldquo;reverse acquisition&rdquo;, securities analysts of brokerage firms may not provide or continue
to provide coverage of us since there is little incentive to brokerage firms to recommend the purchase of our common stock. No
assurance can be given that brokerage firms will want to conduct any follow-on offerings on behalf of us in the future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Voting
power of our shareholders is highly concentrated by insiders.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
officers, directors, and 5% shareholders control, either directly or indirectly, a substantial portion of our voting securities.
Therefore, our management may significantly affect the outcome of all corporate actions and decisions for an indefinite period
of time including election of directors, amendment of charter documents and approval of mergers and other significant corporate
transactions.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>We
do not intend to pay dividends on our common stock for the foreseeable future.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have paid no dividends on our common stock to date and we do not anticipate paying any dividends to holders of our common stock
in the foreseeable future. While our future dividend policy will be based on the operating results and capital needs of the business,
we currently anticipate that any earnings will be retained to finance our future expansion and for the implementation of our business
plan. Investors should take note of the fact that a lack of a dividend can further affect the market value of our common stock,
and could significantly affect the value of any investment in us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Our
articles of incorporation allow for our board to create new series of preferred stock without further approval by our stockholders,
which could adversely affect the rights of the holders of our common stock.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board of Directors has the authority to fix and determine the relative rights and preferences of preferred stock. Our Board of
Directors has the authority to issue up to 5,000,000 shares of our preferred stock (of which 1 share has been designated Special
Voting Preferred Stock and is issued and outstanding, 278,530 shares have been designated Series A Preferred Stock and are issued
and outstanding, and 1,000,000 shares have been designated as Series B Preferred Stock, of which 673,613 shares are issued and
outstanding, as of June 6, 2019) without further stockholder approval. As a result, our Board of Directors could authorize the
issuance of additional series of preferred stock that would grant to holders the preferred right to our assets upon liquidation,
the right to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption
of the shares, together with a premium, prior to the redemption of our common stock. In addition, our Board of Directors could
authorize the issuance of a series of preferred stock that has greater voting power than our common stock or that is convertible
into our common stock, which could decrease the relative voting power of our common stock or result in dilution to our existing
stockholders. Although we have no present intention to issue any additional shares of preferred stock or to create any additional
series of preferred stock, we may issue such shares in the future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Our
issuance of common stock upon exercise of warrants, Performance Share Units, or options, exchange of Exchangeable Shares, or conversion
of Series B Preferred Stock may depress the price of our common stock.</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of June 15, 2019, we had 3,827,259 shares of common stock issued and outstanding, 7,813 shares of common stock issuable upon exchange
of the Exchangeable Shares of Exchangeco (which entitle the holder to require Exchangeco to redeem (or, at the option of us or
Callco, to have us or Callco purchase) the Exchangeable Shares, and upon such redemption or purchase to receive an equal number
of shares of our common stock) (the Exchangeable Shares are recognized on an as-exchanged for common stock basis for financial
statement purposes), outstanding warrants to purchase 1,669,803 shares of common stock, outstanding Series B convertible preferred
shares that are convertible into 168,427 shares of common stock and outstanding options to purchase 292,683 shares of common stock.
All Exchangeable Shares, warrants, and options are convertible or exercisable into one share of common stock. Each share of Series
B preferred stock is convertible into 0.25 shares of common stock. The issuance of shares of common stock upon exercise of outstanding
warrants or options or exchange of Exchangeable Shares could result in substantial dilution to our stockholders, which may have
a negative effect on the price of our common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_004"></A>FORWARD-LOOKING
STATEMENTS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">This
prospectus and the documents incorporated herein by reference contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are based on our management&rsquo;s current beliefs, expectations and
assumptions about future events, conditions and results and on information currently available to us. Discussions containing these
forward-looking statements may be found, among other places, in the Sections entitled &ldquo;Business,&rdquo; &ldquo;Risk Factors&rdquo;
and &ldquo;Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations&rdquo;.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
statements, other than statements of historical fact, included regarding our strategy, future operations, financial position,
future revenues, projected costs, plans, prospects and objectives are forward-looking statements. Words such as &ldquo;expect,&rdquo;
&ldquo;anticipate,&rdquo; &ldquo;intend,&rdquo; &ldquo;plan,&rdquo; &ldquo;believe,&rdquo; &ldquo;seek,&rdquo; &ldquo;estimate,&rdquo;
&ldquo;think,&rdquo; &ldquo;may,&rdquo; &ldquo;could,&rdquo; &ldquo;will,&rdquo; &ldquo;would,&rdquo; &ldquo;should,&rdquo; &ldquo;continue,&rdquo;
&ldquo;potential,&rdquo; &ldquo;likely,&rdquo; &ldquo;opportunity&rdquo; and similar expressions or variations of such words are
intended to identify forward-looking statements but are not the exclusive means of identifying forward-looking statements. Examples
of our forward-looking statements include:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to raise funds for
                                    general corporate purposes and operations, including our research activities and clinical
                                    trials;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to recruit qualified
                                    management and technical personnel;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the success of our clinical trials;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to expand our international
                                    business;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to obtain and maintain required
                             regulatory approvals for our products;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our expectations regarding the
                                    use of our existing cash and the expected net proceeds of this offering;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">our ability to obtain or maintain patents
                             or other appropriate protection for the intellectual property utilized in our current and planned
                             products; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the other factors discussed in
                                    the &ldquo;Risk Factors&rdquo; section and elsewhere in this prospectus.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Because
forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified
and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events.
The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could
differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New
risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors
and uncertainties. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements
contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">This
prospectus and the documents incorporated herein by reference also refer to estimates and other statistical data made by independent
parties and by us relating to market size and growth and other data about our industry. This data involves a number of assumptions
and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates
of our future performance and the future performance of the markets in which we operate are necessarily subject to a high degree
of uncertainty and risk.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_005"></A>USE
OF PROCEEDS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
will not receive any proceeds from the sale of the shares of our common stock previously issued and issuable upon exercise of
the warrants to purchase shares of our common stock by the selling stockholders from time to time pursuant to this prospectus.
The proceeds from the offering are solely for the account of the selling stockholders. See &ldquo;Selling Stockholders.&rdquo;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
will, however, receive proceeds from any cash exercise of the warrants. If the warrants were exercised in cash with respect to
all of the 760,500 shares of common stock offered hereby, we would receive gross proceeds of approximately $2.36 million, subject
to certain anti-dilution provisions. We cannot predict when or if the warrants will be exercised, and it is possible that the
warrants may expire and never be exercised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Any
net proceeds received by us from the exercise of the warrants will be used for our clinical trials and for general corporate purposes,
which may include working capital, capital expenditures, research and development and other commercial expenditures. In addition,
we may use the net proceeds from the exercise of the warrants for investments in businesses, products or technologies that are
complementary to our business, although we have no present commitments or agreements to make any such investments as of the date
of this prospectus. Pending these uses, we intend to invest the funds in short-term, investment grade, interest-bearing securities.
It is possible that, pending their use, we may invest the net proceeds in a way that does not yield a favorable, or any, return
for us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
management will have broad discretion as to the allocation of the net proceeds from the exercise of the warrants, if any, and
could use them for purposes other than those contemplated at the time of commencement of this offering.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_006"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>MANAGEMENT&rsquo;S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND<BR>
RESULTS OF OPERATIONS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">This
Management&rsquo;s Discussion and Analysis (&ldquo;MD&amp;A&rdquo;) contains &ldquo;forward-looking statements&rdquo;, within
the meaning of the Private Securities Litigation Reform Act of 1995, which represent our projections, estimates, expectations,
or beliefs concerning, among other things, financial items that relate to management&rsquo;s future plans or objectives or to
our future economic and financial performance. In some cases, you can identify these statements by terminology such as &ldquo;may&rdquo;,
&ldquo;should&rdquo;, &ldquo;plans&rdquo;, &ldquo;believe&rdquo;, &ldquo;will&rdquo;, &ldquo;anticipate&rdquo;, &ldquo;estimate&rdquo;,
&ldquo;expect&rdquo; &ldquo;project&rdquo;, or &ldquo;intend&rdquo;, including their opposites or similar phrases or expressions.
You should be aware that these statements are projections or estimates as to future events and are subject to a number of factors
that may tend to influence the accuracy of the statements. These forward-looking statements should not be regarded as a representation
by us or any other person that our events or plans will be achieved. You should not unduly rely on these forward-looking statements,
which speak only as of the date of this report. Except as may be required under applicable securities laws, we undertake no obligation
to publicly revise any forward-looking statement to reflect circumstances or events after the date of this report or to reflect
the occurrence of unanticipated events.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">You
should review the factors and risks we describe under &ldquo;Risk Factors&rdquo; and &ldquo;Forward-Looking Statements&rdquo;
included elsewhere in this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Overview</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. Our
mission is to benefit patients, by developing and commercializing anti-cancer therapies for patients whose tumors exhibit features
that make them resistant to, or unlikely to respond to, currently available therapies, particularly for orphan cancer indications
where patients have failed, or are unlikely to respond to, currently available therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are developing VAL-083, a novel, validated, DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma
multiforme (&ldquo;GBM&rdquo;) and potentially other solid tumors, including ovarian cancer. VAL-083 is a first-in-class, small-molecule,
DNA-targeting chemotherapeutic that demonstrated activity against a range of tumor types in prior Phase 1 and Phase 2 clinical
studies sponsored by the US National Cancer Institute (&ldquo;NCI&rdquo;). As part of our business strategy, we leverage and build
upon these prior NCI investments and data from more than 40 NCI- Phase 1 and Phase 2 clinical studies with our own research to
identify and target unmet medical needs in modern cancer care. DNA-targeting agents are among the most successful and widely used
treatments for cancer. Their efficacy is based on the ability to bind with a cancer cell&rsquo;s DNA and interfere with the process
of protein production required for growth and survival of cancer cells. &ldquo;First-in-class&rdquo; means that VAL-083 embodies
a unique molecular structure which is not an analogue or derivative of any approved product, or product under development, for
the treatment of cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Corporate
History</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. (&ldquo;Berry&rsquo;). Prior to a reverse acquisition
undertaken on January 25, 2013 Berry did not have any significant assets or operations. We are the parent company of Del Mar Pharmaceuticals
(BC) Ltd. (&ldquo;Del Mar (BC)&rdquo;), a British Columbia, Canada corporation incorporated on April 6, 2010, that is focused
on the development of drugs for the treatment of cancer. We are also the parent company to 0959454 B.C. Ltd., a British Columbia
corporation (&ldquo;Callco&rdquo;), and 0959456 B.C. Ltd., a British Columbia corporation (&ldquo;Exchangeco&rdquo;). Callco and
Exchangeco were formed to facilitate the reverse acquisition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Results
of Operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Comparison
of the nine months ended March 31, 2019 and March 31, 2018</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months ended</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31, <BR> 2019<BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31, <BR> 2018<BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change<BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change<BR> %</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-align: left; text-indent: -10pt; padding-left: 10pt">Research and development</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,702,213</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,856,197</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(3,153,984</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(54</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">General and administrative</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,796,884</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,911,538</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(114,654</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Change in fair value of derivative liability</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(852</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(57,839</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">56,987</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(99</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Foreign exchange loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">16,754</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">57,406</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(40,652</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(71</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Interest income</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(49,513</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(6,241</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(43,272</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: right">693</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net loss and comprehensive loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,465,486</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,761,061</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,295,575</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Research
and Development</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Research
and development expenses decreased to $2,702,213 for the nine months ended March 31, 2019 from $5,856,197 for the nine months
ended March 31, 2018. The decrease was largely attributable to a decrease in clinical development costs, personnel, preclinical
research, intellectual property and travel costs during the nine months ended March 31, 2019 compared to the nine months ended
March 31, 2018. For the nine months ended March 31, 2019 and 2018 non-cash, share-based compensation expense of $74,735 and $135,367
respectively, related to stock option expense and shares issued for services. During the nine months ended March 31, 2018, we
entered into a separation agreement with our former President and Chief Operating Officer that required the accelerated vesting
of certain stock options. The full expense of the accelerated vesting was recognized during the nine months ended March 31, 2018
resulting in a higher non-cash, share-based compensation expense for the nine months ended March 31, 2018 compared to the nine
months ended March 31, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Excluding
the impact of non-cash, share-based compensation expense, research and development expenses decreased to $2,627,478 during the
current period from $5,720,830 for the prior period. The decrease in clinical development costs for the nine months ended March
31, 2019 compared to the nine months ended March 31, 2018 was primarily due to the parking of our STAR-3, Phase 3 study which
was announced in February 2018. During the nine months ended March 31, 2018, we incurred significant study start-up costs. In
addition, clinical development costs were higher in the prior period compared to the current period due to the timing of certain
manufacturing activities for the production of GMP material and related stability studies. Clinical development costs can vary
significantly due to the timing of patient enrollment, how a patient reacts to treatment, and the number of treatment cycles a
patient receives.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Personnel
costs decreased during the nine months ended March 31, 2019 compared to the nine months ended March 31, 2018 primarily due to
amounts recognized pursuant to the settlement agreement with our former President and Chief Operating Officer. Preclinical research
decreased largely due to a decrease in the ongoing mechanism of action research that we have undertaken in the prior period. Intellectual
property costs decreased in the nine months ended March 31, 2019 compared to the nine months ended March 31, 2018 as we have refined
our patent portfolio by focusing on our most important patent claims in the most important jurisdictions. Patent costs can vary
considerably depending on the filing of new patents, conversion of the provisional applications to PCT applications, foreign office
actions, and actual filing costs. Travel costs have decreased in the nine months ended March 31, 2019 compared to the nine months
ended March 31, 2018 as we have focused on reducing all travel expenses.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>General
and Administrative</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">General
and administrative expenses were $2,796,884 for the nine months ended March 31, 2019 compared to $2,911,538 for the nine months
ended March 31, 2018. The decrease was largely due to lower professional fees and travel partially offset by higher personnel
and non-cash, share-based compensation expense in the current period compared to the prior period. In relation to general and
administrative expenses during the nine months ended March 31, 2019, we incurred non-cash, share-based compensation expense of
$510,661 relating to performance share units, warrants issued for services, and stock option expense while during the nine months
ended March 31, 2018, we incurred non-cash, share-based compensation expense of $455,331 relating to warrants issued for services
and stock option expense. The performance stock units were issued in April 2018 so no expense for these equity instruments were
recognized during the nine months ended March 31, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Excluding
the impact of non-cash, share-based compensation expense, general and administrative expenses decreased in the nine months ended
March 31, 2019 to $2,286,223 from $2,456,207 for the nine months ended March 31, 2018. The decrease was primarily due to decreased
professional fees and travel costs partially offset by higher personnel costs. Professional fees decreased as a result of certain
costs incurred in the prior period that have not been incurred in the current period. Legal fees have decreased in the nine months
ended March 31, 2019 compared to nine months ended March 31, 2018 in part due to the timing of our annual meeting of stockholders.
In the current period, we have not yet incurred costs for this matter while a portion of these costs was incurred in the prior
period. Overall, costs for regulatory filings and corporate governance matters have been lower in the current nine months compared
to the prior nine months. Partially offsetting lower legal fees are increased public relations and business development costs
due to our efforts to expand our outreach to investors while accounting support has increased due to the complexity of the valuation,
and accounting for, our equity instruments. Travel costs have decreased in the nine months ended March 31, 2019 compared to the
nine months ended March 31, 2018 as we have focused on reducing all travel expenses. Personnel costs have increased during the
nine months ended March 31, 2019 compared to the nine months ended March 31, 2018 primarily due to the appointment of our President
and Chief Executive Officer in May 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Change
in fair value of derivative liability</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on the terms of certain warrants issued by us, we have determined that the warrants were a derivative liability which is recognized
at fair value at the date of the transaction and re-measured at fair value every reporting period with gains or losses on the
changes in fair value recorded in the consolidated condensed statement of loss and comprehensive loss. The balances recognized
during the nine months ended March 31, 2019 and 2018 were primarily due to changes in our common stock price between the date
the warrants were last valued on June 30, 2018 and 2017 respectively. These are the previous valuation dates used for the nine
months ended March 31.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
recognized gains of $852 and $57,839 from the change in fair value of the derivative liability for the nine months ended March
31, 2019 and 2018, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Foreign
Exchange</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
functional currency at June 30, 2018 and March 31, 2019 is the US$ but we incur a portion of our expenses in CA$. The foreign
exchange gains and losses are reported in other loss (income) in the consolidated condensed interim statement of loss and comprehensive
loss. We have recognized foreign exchange losses of $16,754 and $57,406 for the nine-month periods ended March 31, 2019 and 2018,
respectively. The losses were due to changes in the exchange rate between the CA$ and the US$ and to varying levels of CA$ cash
and accounts payable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Preferred
Share Dividends</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
each of the nine-month periods ended March 31, 2019 and 2018 we recorded $6,267 related to the dividend payable to Valent on the
Series A preferred stock. The dividend has been recorded as a direct increase in accumulated deficit for both periods.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the nine months ended March 31, 2019, we issued 14,430 (2018 &mdash; 14,881) shares of common stock as a dividend on the Series
B Preferred stock and recognized $75,477 (2018 &mdash; $142,358) as a direct increase in accumulated deficit.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Comparison
of the years ended June 30, 2018 and June 30, 2017</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Years ended</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30,<BR> 2018 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30,<BR> 2017 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change <BR> %</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-align: left; text-indent: -10pt; padding-left: 10pt">Research and development</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">7,132,952</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,003,640</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,129,312</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">43</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">General and administrative</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,041,711</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,317,189</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">724,522</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Change in fair value of stock option and derivative liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(60,111</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(245,963</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">185,852</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(76</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Foreign exchange loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">57,003</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,355</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49,648</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">675</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Interest income</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(33,243</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(457</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(32,786</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: right">7,174</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net loss and comprehensive loss</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,138,312</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,081,764</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,056,548</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Research
and Development</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Research
and development expenses increased to $7,132,952 for the year ended June 30, 2018 from $5,003,640 for the year ended June 30,
2017. The increase was largely attributable to an increase in clinical development, personnel, and preclinical research partially
offset by lower travel costs. Non-cash, share-based compensation expense for the year ended June 30, 2018 was $149,452 related
to stock option expense and shares issued for services while non-cash, share-based compensation expense for the year ended June
30, 2017 was $102,828 for stock option expense and warrants issued for services.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Excluding
the impact of non-cash, share-based compensation expense, research and development expenses increased to $6,983,500 during the
current year from $4,900,812 for the prior year. The increase in clinical development costs for the year ended June 30, 2018 compared
to the year ended June 30, 2017 was partially due to manufacturing costs for GMP material as well as ongoing trial costs for our
two Phase 2, biomarker-driven, MGMT-unmethylated, GBM studies. At June 30, 2017, our Phase 2 study in Avastin-na&iuml;ve unmethylated
GBM patients being conducted at the MD Anderson Cancer Center had commenced in February 2017 so patient enrollment had just begun.
Also, in the prior year, enrollment in our Phase 2 study in newly diagnosed unmethylated GBM patients in China had not yet started
enrollment.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the year ended June 30, 2018, we undertook site initiation and enrollment for its now-parked STAR-3, Phase 3 study in GBM. During
the year ended June 30, 2018, we recognized certain costs relating to the parking of the trial. As our two Phase 2, biomarker-driven
studies are partially supported through collaboration arrangements, the ongoing clinical costs for these two studies will be lower
than the overall clinical costs incurred by us for the year ended June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Personnel
costs increased during the current year compared to the prior year primarily due to amounts recognized for payments made to our
former President and Chief Operating Officer pursuant to a settlement agreement between us and such individual. Preclinical research
increased in the year ended June 30, 2018 compared to the year ended June 30, 2017 largely due our research agreement with Duke
University which commenced in April 2017 as well as due to an increase in the ongoing mechanism of action research that we have
undertaken in the current year. Travel costs have decreased in the year ended June 30, 2018 compared to the year ended June 30,
2017 as we have focused on reducing all but essential travel.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>General
and Administrative</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">General
and administrative expenses were $4,041,711 for the year ended June 30, 2018 compared to $3,317,189 for the year ended June 30,
2017. The increase was primarily due to an increase in professional fees and personnel costs. In relation to general and administrative
expenses during the year ended June 30, 2018, we incurred non-cash, share-based compensation expense of $596,079 relating to warrants
issued for services, stock option expense, and the PSUs while during the year ended June 30, 2017, we incurred non-cash, share-based
compensation expense of $667,521 relating to shares and warrants issued for services, and stock option expense.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Excluding
the impact of non-cash, share-based compensation expense, general and administrative expenses increased in the year ended June
30, 2018 to $3,445,632 from $2,649,668 for the year ended June 30, 2017. Professional fees incurred during the year ended June
30, 2018 relate to various matters including preparation for our first annual meeting of stockholders which was held April 11,
2018, completing our 2017 Omnibus Incentive Plan, regulatory filings, and corporate governance matters. In the year ended June
30, 2017, the costs were incurred related to preparing for our uplisting of its common stock on the Nasdaq Stock Market as well
as fees associated with one-time listing activities, and the filing of three registration statements with the SEC that were all
declared effective in September 2016. Personnel costs increased during the current year compared to the prior year primarily due
to amounts recognized for payments made to our former President and Chief Operating Officer pursuant to the settlement agreement.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Change
in fair value of stock option and derivative liabilities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on the terms of certain warrants issued by us, we determined that such warrants were a derivative liability which is recognized
at fair value at the date of the transaction and re-measured at fair value every reporting period with gains or losses on the
changes in fair value recorded in the consolidated statement of operations and comprehensive loss. The gains recognized during
the years ended June 30, 2018 and 2017 were primarily due to changes in our common stock price between June 30, 2017 and 2016,
respectively, and June 30, 2018 and 2017, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
recognized a gain of $60,111 from the change in fair value of the derivative liability for the year ended June 30, 2018 and a
gain of $331,057 for the year ended June 30, 2017.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Changes
in our common stock price can result in significant volatility in our reported net loss due to its impact on the fair value of
the derivative liability. As a result of revaluation gains and losses, we expect that our reported net income or loss will continue
to fluctuate significantly.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Certain
of our stock options have been issued in $CA. Of these, a portion were classified as a stock option liability which is revalued
at each reporting date. During the year ended June 30, 2017, we amended 4,375 of these stock options held by five optionees such
that the exercise price of the options was adjusted to be denominated in $USD. No other terms of the stock options were amended.
As a result of the amendment, we recognized $85,094 in stock option liability expense and $260,969 was reclassified to equity
during the year ended June 30, 2017.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Foreign
Exchange</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
functional currency at June 30, 2018 was the US$, but we incur a portion of its expenses in CA$. The foreign exchange gains and
losses are reported in other loss (income) in the consolidated statement of operations and comprehensive loss.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
recognized foreign exchange losses of $57,003 and $7,355 for the years ended June 30, 2018 and 2017, respectively. The losses
were due to changes in the exchange rate between the CA$ and the US$ and to varying levels of CA$ cash and accounts payable.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Preferred
Share Dividends</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
each of the years ended June 30, 2018 and 2017, we recognized $8,356 related to the dividend payable to Valent on the Series A
preferred stock. The dividend has been recorded as a direct increase in accumulated deficit for both periods.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
issued 19,841 (2017 &mdash; 20,045) shares of common stock on June 30, 2018 as a dividend on the Series B Preferred stock and
recognized $176,236 (2017 &mdash; $790,454) as a direct increase in accumulated deficit.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Liquidity
and Capital Resources</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Nine
months ended March 31, 2019 compared to the nine months ended March 31, 2018</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31,<BR> 2019<BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31,<BR> 2018<BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change<BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change<BR> %</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-align: left">Cash flows from operating activities</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(4,514,674</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(7,318,012</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,803,338</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(38</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Cash flows from investing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,649</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,649</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(100</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Cash flows from financing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">694,912</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,251,569</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8,556,657</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(92</TD><TD STYLE="text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Operating
Activities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Net
cash used in operating activities decreased to $4,514,674 for the nine months ended March 31, 2019 from $7,318,012 for the nine
months ended March 31, 2018. During the nine months ended March 31, 2019 and 2018, we reported net losses of $5,465,486 and $8,761,061,
respectively. During the nine months ended March 31, 2019, we recorded a gain from the revaluation of the derivative liability
of $852 compared to a gain of $57,839 for the nine months ended March 31, 2018. Excluding the impact of changes in the fair value
of the derivative liability, non-cash items relating to amortization of intangible assets, shares and warrants issued for services,
stock option expense, and performance share unit expense totaled $598,944 for the nine months ended March 31, 2019. Non-cash items
relating to amortization of intangible assets, warrants issued for services, and stock option expense totaled $608,567 for the
nine months ended March 31, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
most significant changes in non-cash working capital for the nine months ended March 31, 2019 was an increase in cash from a decrease
in prepaid expenses and deposits of $794,859 due to a partial refund of our clinical trial deposit related to our now-parked STAR-3
Phase 3 study. The other significant change in on-cash working capital in the current period was a decrease in cash from a reduction
in accounts payable and accrued liabilities of $425,383. The most significant changes in non-cash working capital for the nine
months ended March 31, 2018 was cash from an increase of accounts payable and accrued liabilities of $708,634 and cash from a
decrease in prepaid expense and deposits of $135,293.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Investing
activities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the nine months ended March 31, 2018, we incurred $12,649 in relation to the development of our website. There were no cash flows
from investing activities during the nine months ended March 31, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Financing
Activities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the nine months ended March 31, 2019, we received $726,179 in net proceeds from the exercise of warrants pursuant to the Warrant
Exercise Agreements. During the nine months ended March 31, 2018, we received $8,945,336 in net proceeds from the completion of
a registered direct offering by us of common stock and common stock purchase warrants. In addition, we recorded $6,267 related
to the dividend payable to Valent during each of the nine months ended March 31, 2019 and 2018 respectively. During the nine months
ended March 31, 2019, we also recognized $25,000 in deferred costs related to our pending financing.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Comparison
of the years ended June 30, 2018 and June 30, 2017</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2017 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Change <BR> %</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from operating activities</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(9,850,850</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(8,019,071</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(1,831,779</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">23</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from investing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,649</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(20,956</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,307</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(40</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from financing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,249,480</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,468,777</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">780,703</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Operating
activities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Net
cash used in operating activities increased to $9,850,850 for the year ended June 30, 2018 from $8,019,071 for the year
ended June 30, 2017. During the year ended June 30, 2018 and 2017, we reported net losses of $11,138,312 and $8,081,764,
respectively. During the year ended June 30, 2018, we recorded a gain from the revaluation of the derivative and stock option
liabilities of $60,111 compared to a gain of $245,963 for the year ended June 30, 2017. Excluding the impact of changes in
the fair value of the derivative and stock option liabilities, non-cash items relating to amortization of intangible assets,
shares and warrants issued for services, and PSU and stock option expense totaled $770,059 for the year ended June 30, 2018.
Non-cash items relating to amortization of intangible assets, shares and warrants issued for services, and stock option
expense totaled $787,032 for the year ended June 30, 2017. The most significant changes in non-cash working capital for the
year ended June 30, 2018 was from an inflow due to increase in accounts payable and accrued liabilities of $295,774 and from
an inflow due to a decrease in prepaid expenses and deposits of $173,192. The most significant changes in non-cash working
capital for the year ended June 30, 2017 was from an outflow from an increase in prepaid expenses and deposits of $1,063,991
and from an inflow due to an increase in accounts payable and accrued liabilities of $598,310.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of June 30, 2018, we had cash and cash equivalents to fund operations into the middle of calendar 2019. We will need to raise
additional capital in the near future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Investing
activities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the years ended June 30, 2018 and 2017, we incurred $12,649 and $20,956, respectively, in relation to the development of our website.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Financing
activities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the year ended June 30, 2018, we received $8,945,336 in net proceeds from the completion of a registered direct offering by us
of common stock and common stock purchase warrants. During the year ended June 30, 2017, we received $7,932,107 in net proceeds
from a public offering of its common stock and common stock purchase warrants.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the years ended June 30, 2018 and 2017, we received $312,500 and $545,026, respectively, from the exercise of warrants. In addition,
we recognized $8,356 related to the dividend payable to Valent during each of the years ended June 30, 2018 and 2017, respectively.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Going
Concern and Capital Expenditure Requirements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Registered
Direct Offering and Private Placement</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
June 5, 2019, we completed a registered direct offering (the &ldquo;RD Offering&rdquo;) of an aggregate of 1,170,000 shares of
common stock and warrants to purchase 760,500 shares of common stock in a concurrent private placement, at a combined purchase
price of $3.10 per share and related warrant. The warrants have an exercise price of $3.10 per share, are immediately exercisable
and have a term of exercise of five years. The gross proceeds from the offering, prior to deducting offering expenses and placement
agent fees and expenses payable by us, were $3.6 million.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Going
Concern</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(See
note 1 to the consolidated condensed interim financial statements)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
consolidated condensed interim financial statements have been prepared on a going concern basis which assumes that we will continue
our operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the
normal course of business.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the nine months ended March 31, 2019, we reported a loss of $5,465,486 and negative cash flow from operations of $4,514,674. As
of March 31, 2019, we had an accumulated deficit of $57,988,567 and cash and cash equivalents on hand of $2,152,233. We are in
the development stage and have not generated any revenues to date. We do not have the prospect of achieving revenues until such
time that our product candidate is commercialized, or partnered, which may not ever occur. In the near future, we will require
additional funding to maintain our clinical trials, research and development projects, and for general operations. These circumstances
indicate substantial doubt exists about our ability to continue as a going concern.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consequently,
management is pursuing various financing alternatives to fund our operations so we can continue as a going concern. Management
plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership arrangements.
We may tailor our drug candidate development program based on the amount of funding we are able to raise in the future. Nevertheless,
there is no assurance that these initiatives will be successful.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should we be unable to continue as a going concern. Such adjustments could be material.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
future funding requirements will depend on many factors, including but not limited to:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the rate of progress and cost of our
                             clinical trials, preclinical studies and other discovery and research and development activities;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the costs associated with establishing
                                    manufacturing and commercialization capabilities;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the costs of acquiring or investing
                             in businesses, product candidates and technologies;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the costs of filing, prosecuting, defending
                             and enforcing any patent claims and other intellectual property rights;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the costs and timing of seeking
                                    and obtaining FDA and other regulatory approvals;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the effect of competing technological
                             and market developments;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the economic and other terms and timing
                             of any collaboration, licensing or other arrangements into which we may enter; and.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">the impact of us being a public
                                    entity.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
September 2018, we announced that we had engaged Oppenheimer &amp; Co. Inc. as our strategic advisor to help manage the exploration
and evaluation of a wide range of strategic opportunities. Until we can generate a sufficient amount of product revenue to finance
our cash requirements, which we may never do, we expect to finance future cash needs primarily through public or private equity
offerings or strategic collaborations. The sale of equity and convertible debt securities may result in dilution to our stockholders
and certain of those securities may have rights senior to those of our shares of capital stock. If we raise additional funds through
the issuance of preferred stock, convertible debt securities or other debt financing, these securities or other debt could contain
covenants that would restrict our operations. Any other third-party funding arrangement could require us to relinquish valuable
rights. Economic conditions may affect the availability of funds and activity in equity markets. We do not know whether additional
funding will be available on acceptable terms, or at all. If we are not able to secure additional funding when needed, we may
have to delay, reduce the scope of or eliminate one or more of our clinical trials or research and development programs or make
changes to our operating plan. In addition, we may have to seek a partner for one or more of our product candidate programs at
an earlier stage of development, which would lower the economic value of those programs to us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Critical
Accounting Policies</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
preparation of financial statements, in conformity with generally accepted accounting principles in the United States, requires
companies to establish accounting policies and to make estimates that affect both the amount and timing of the recording of assets,
liabilities, revenues and expenses. Some of these estimates require judgments about matters that are inherently uncertain and
therefore actual results may differ from those estimates.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
detailed presentation of all of our significant accounting policies and the estimates derived therefrom is included in Note 2
to our consolidated financial statements for the year ended June 30, 2018 contained elsewhere in this prospectus. While all of
the significant accounting policies are important to our consolidated condensed financial statements, the following accounting
policies and the estimates derived therefrom are critical:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Warrants
                                         and shares issued for services</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Stock
                                         options</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Performance stock units</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Derivative liability</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Clinical trial accruals</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Warrants
and shares issued for services</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have issued equity instruments for services provided by employees and nonemployees. The equity instruments are valued at the fair
value of the instrument granted.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Stock
options</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
account for these awards under Accounting Standards Codification (&ldquo;ASC&rdquo;) 718, &ldquo;Compensation &mdash; Stock Compensation&rdquo;
(&ldquo;ASC 718&rdquo;). ASC 718 requires measurement of compensation cost for all stock-based awards at fair value on the date
of grant and recognition of compensation over the requisite service period for awards expected to vest. Compensation expense for
unvested options to non-employees is revalued at each period end and is being amortized over the vesting period of the options.
The determination of grant-date fair value for stock option awards is estimated using the Black-Scholes model, which includes
variables such as the expected volatility of our share price, the anticipated exercise behavior of its grantee, interest rates,
and dividend yields. These variables are projected based on our historical data, experience, and other factors. Changes in any
of these variables could result in material adjustments to the expense recognized for share-based payments. Such value is recognized
as expense over the requisite service period, net of actual forfeitures, using the accelerated attribution method. We recognize
forfeitures as they occur. The estimation of stock awards that will ultimately vest requires judgment, and to the extent actual
results, or updated estimates, differ from current estimates, such amounts are recorded as a cumulative adjustment in the period
estimates are revised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Performance
stock units</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
also account for performance stock units (PSU&rsquo;s) under ASC 718. ASC 718 requires measurement of compensation cost for all
stock-based awards at fair value on the date of grant and recognition of compensation over the requisite service period for awards
expected to vest. As vesting of the PSU&rsquo;s is based on a number of factors, the determination of the grant-date fair value
for PSU&rsquo;s has been estimated using a Monte Carlo simulation approach which includes variables such as the expected volatility
of our share price and interest rates to generate potential future outcomes. These variables are projected based on our historical
data, experience, and other factors. Changes in any of these variables could result in material adjustments to the expense recognized
for the PSUs. Such value is recognized as expense over the derived service period using the accelerated attribution method. The
estimation of PSUs that will ultimately vest requires judgment, and to the extent actual results, or updated estimates, differ
from current estimates, such amounts are recorded as a cumulative adjustment in the period estimates are revised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Derivative
liability</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
account for certain warrants under the authoritative guidance on accounting for derivative financial instruments indexed to, and
potentially settled in, a company&rsquo;s own stock, on the understanding that in compliance with applicable securities laws,
the warrants require the issuance of securities upon exercise and do not sufficiently preclude an implied right to net cash settlement.
We classify these warrants on our balance sheet as a derivative liability which is fair valued at each reporting period subsequent
to the initial issuance. We have used a binomial model as well as a Black-Scholes Option Pricing Model (based on a closed-form
model that uses a fixed equation) to estimate the fair value of the share warrants. Determining the appropriate fair-value model
and calculating the fair value of warrants requires considerable judgment. Any change in the estimates (specifically probabilities
and volatility) used may cause the value to be higher or lower than that reported. The estimated volatility of our common stock
at the date of issuance, and at each subsequent reporting period, is based on our historical volatility. The risk-free interest
rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the warrants
at the valuation date. The expected life of the warrants is assumed to be equivalent to their remaining contractual term.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Clinical
trial accruals</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Clinical
trial expenses are a component of research and development costs and include fees paid to contract research organizations, investigators
and other service providers who conduct specific research for development activities on our behalf. The amount of clinical trial
expenses recognized in a period related to service agreements is based on estimates of the work performed on an accrual basis.
These estimates are based on patient enrollment, services provided and goods delivered, contractual terms and experience with
similar contracts. We monitor these factors by maintaining regular communication with the service providers. Differences between
actual expenses and estimated expenses recorded are adjusted for in the period in which they become known. Prepaid expenses or
accrued liabilities are adjusted if payments to service providers differ from estimates of the amount of service completed in
a given period.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Off-Balance
                                         Sheet Arrangements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
do not have any off-balance sheet arrangements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_007"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>BUSINESS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Background</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. Our
mission is to benefit patients by developing and commercializing anti-cancer therapies for patients whose tumors exhibit features
that make them resistant to, or unlikely to respond to, currently available therapies, particularly for orphan cancer indications
where patients have failed, or are unlikely to respond to, currently available therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of December 31, 2018, we have spent approximately $37.3 million of shareholder capital in developing VAL-083, a novel, validated,
DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma multiforme (&ldquo;GBM&rdquo;) and
potentially other solid tumors, including ovarian cancer, non-small cell lung cancer (&ldquo;NSCLC&rdquo;), and diffuse intrinsic
pontine glioma (&ldquo;DIPG&rdquo;). VAL-083 is a first-in-class, small-molecule, DNA-targeting chemotherapeutic that demonstrated
activity against a range of tumor types in prior Phase 1 and Phase 2 clinical studies sponsored by the US National Cancer Institute
(&ldquo;NCI&rdquo;). As part of our business strategy, we leverage and build upon these prior NCI investments and data from more
than 40 NCI- Phase 1 and Phase 2 clinical studies, which includes an estimated 1,000 patient safety database, with our own research
to identify and target unmet medical needs in modern cancer care. DNA-targeting agents are among the most successful and widely
used treatments for cancer. Their efficacy is based on the ability to bind with a cancer cell&rsquo;s DNA and interfere with the
process of protein production required for growth and survival of cancer cells. &ldquo;First-in-class&rdquo; means that VAL-083
embodies a unique molecular structure which is not an analogue or derivative of any approved product, or product under development,
for the treatment of cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
recent research has highlighted the opportunities afforded by VAL-083&rsquo;s unique mechanism of action and its potential to
address unmet medical needs by focusing our development efforts on patients whose tumors exhibit biological features that make
them resistant to, or unlikely to respond to, currently available therapies. For example, our research demonstrating VAL-083&rsquo;s
activity in GBM independent of the O6-methyl guanine methyltransferase (&ldquo;MGMT&rdquo;) methylation status allows us to focus
patient selection based on this important biomarker.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are conducting two open-label, biomarker driven Phase 2 studies in MGMT-unmethylated GBM. MGMT is a DNA-repair enzyme that is
associated with resistance to temozolomide, the current standard-of-care chemotherapy used in the treatment of GBM. Greater than
60% of GBM patients have MGMT-unmethylated tumors and exhibit a high expression of MGMT, which is correlated with temozolomide
treatment failure and poor patient outcomes. Our research demonstrates that VAL-083&rsquo;s anti-tumor activity is independent
of MGMT expression. In our Phase 2 studies we are using MGMT as a biomarker to identify patients for treatment with VAL-083 in
the newly-diagnosed, maintenance-stage (adjuvant) and recurrent treatment settings. If successful, the result of these studies
could position VAL-083 for advancement to pivotal clinical studies as a potential replacement for temozolomide in MGMT-unmethylated
GBM. We anticipate presenting data from these studies at peer reviewed scientific meetings during calendar 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">With
respect to our STAR-3, Phase 3 study, we have finalized the decision to discontinue this clinical study due to competitive landscape,
patient enrollment rates, and potential risk of success assessment, and to allow us to focus on enrolling GBM patients in our
two biomarker-driven Phase 2 studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have received notice to proceed from the US Food and Drug Administration (&ldquo;FDA&rdquo;) for a phase 1/2, open-label, multicenter
study of VAL-083 in patients with <B><U>Re</U></B>current <B><U>P</U></B>latinum <B><U>R</U></B>esistant <B><U>Ov</U></B>arian
Cancer (&ldquo;REPROVe&rdquo;). Platinum-based chemotherapy is the standard-of-care in the treatment of ovarian cancer. Nearly
all ovarian cancer patients eventually become resistant to platinum (&ldquo;Pt&rdquo;) based chemotherapy leading to treatment
failure and poor patient outcomes. We have demonstrated that VAL-083 is active against Pt-resistant ovarian cancer <I>in vitro.
</I>However, based on ongoing evaluation and input from our ovarian cancer advisory board, we are reassessing the development
of VAL-083 for the treatment of ovarian cancer. We are in the process of evaluating the best path forward in ovarian cancer and
are evaluating strategic options, including the potential combination of VAL-083 with PARP inhibitors. At the American Association
for Cancer Research (&ldquo;AACR&rdquo;) Annual Meeting in 2018 we presented preclinical data showing that VAL-083 can synergize
PARP inhibitors in both a BRACA-proficient and -deficient setting.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to our clinical development activities in the United States, pursuant to our collaboration with Guangxi Wuzhou Pharmaceutical
(Group) Co. Ltd. (&ldquo;Guangxi Wuzhou Pharmaceutical Company&rdquo;), we have provided Guangxi Wuzhou Pharmaceutical Company
certain commercial rights to VAL-083 in China where it is approved as a chemotherapy for the treatment of chronic myelogenous
leukemia (&ldquo;CML&rdquo;) and lung cancer. Guangxi Wuzhou Pharmaceutical Company is the only manufacturer presently licensed
by the China Food and Drug Administration (&ldquo;CFDA&rdquo;) to produce the product for the China market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have a broad patent portfolio to protect our intellectual property. Our patent applications claim composition of matter and methods
of use of VAL-083 and related compounds, synthetic methods, and quality controls for the manufacturing process of VAL-083. We
believe that our portfolio of intellectual property rights provides a defensible market position for the commercialization of
VAL-083. In addition, VAL-083 has been granted protection under the Orphan Drug Act by the FDA and the European Medicines Agency
(&ldquo;EMA&rdquo;) for the treatment of gliomas, including GBM. The FDA has also granted Orphan Drug protection to VAL-083 for
the treatment of medulloblastoma and ovarian cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
corporate development strategy is to advance our drug candidate into multiple clinical studies and then to consider licensing,
or acquiring additional product candidates, in order to establish a product pipeline and to position us for long-term sustainability
and growth of shareholder value. We believe the experience of our clinical development team will position us to efficiently develop
drug candidates that we may acquire, or license, in the future.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
intend to continue to evaluate options for our strategic direction. These options may include raising additional capital, the
acquisition of another company and/or complementary assets, our sale, or another type of strategic partnership.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Registered
Direct Offering and Private Placement</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
June 3, 2019, we entered into a securities purchase agreement with the selling stockholders for the issuance and sale of an aggregate
of 1,170,000 shares of common stock in a registered direct offering (the &ldquo;RD Offering&rdquo;) and, in a concurrent private
placement, warrants to purchase 760,500 shares of common stock at a combined purchase price of $3.10 per share and related warrant.
The warrants have an exercise price of $3.10 per share, are immediately exercisable and have a term of exercise of five years.
The closing of the issuance and sale of these securities was consummated on June 5, 2019. The gross proceeds from the offering,
prior to deducting offering expenses and placement agent fees and expenses payable by us, were $3.6 million.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Subject
to certain ownership limitations, the warrants are exercisable commencing on the issuance date at an exercise price equal to $3.10
per share of common stock, subject to adjustments as provided under the terms of the warrants. Subject to certain exceptions set
forth in the warrants, if, on or prior to June 28, 2019, we sell or grant any option to purchase or sell or grant any right to
reprice, or otherwise dispose of or issue, any common stock or securities convertible into or exercisable for common stock at
an effective price per share that is lower than the exercise price of the warrants then in effect, then the exercise price of
the Warrants will be reduced to equal the higher of&thinsp; (A) such lower price or (B) $2.25.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Clinical
Updates Presented at 2019 American Society of Clinical Oncology</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 31, 2019, the Company presented clinical trial updates from the Company&rsquo;s ongoing first- and second-line trials in patients
with MGMT-unmethylated glioblastoma multiforme (GBM) at a key opinion leader (KOL) presentation during the 2019 American Society
of Clinical Oncology (ASCO) annual meeting in Chicago, IL.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">At
the KOL presentation, the Company provided an update on the ongoing Phase 2 clinical study investigating the front-line treatment
of VAL-083 with radiation therapy in newly diagnosed MGMT-unmethylated GBM. This trial is being conducted at the Sun Yat-sen University
Cancer Center (SYSUCC) in Guangzhou, China in collaboration with Guangxi Wuzhou Pharmaceutical Company. The trial is designed
to enroll up to 30 patients to determine if first-line therapy with VAL-083 treatment, in lieu of first-line temozolomide, improves
progression free survival (PFS).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of May 17, 2019, eighteen patients have been enrolled in the trial. Of these patients, fifteen have received their post-cycle
3 MRI and investigator assessment, and ten have received their post-cycle 7 MRI and investigator assessment. Two patients have
not been on the study long enough to reach their first assessment, and one patient died before their first assessment. Assessments
are based on the trial investigator&rsquo;s clinical and radiologic assessment, according to the Response Assessment in NeuroOncology
(RANO) criteria. For the fifteen patients who have received at least one assessment, eight patients were assessed with a best
response of &ldquo;Complete Response&rdquo; (8/15, 53.3% CR) and seven patients were assessed with a best response of &ldquo;Stable
Disease&rdquo; (7/15, 46.7% SD). Fourteen of the eighteen patients were still alive at the data cut-off date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company also provided an update on the ongoing second-line Phase 2 clinical study of VAL-083 in patients with MGMT-unmethylated,
Bevacizumab-na&iuml;ve recurrent GBM. This study is being conducted in collaboration with The University of Texas MD Anderson
Cancer Center (MDACC). This biomarker-driven trial (testing for MGMT methylation status) has been amended to enroll up to 83 patients
(35 with a starting dose of 40 mg/m2; 48 with a starting dose of 30 mg/m<SUP>2</SUP>) to determine the potential of VAL-083 treatment
to improve overall survival compared to historical reference control of 7.2 months with lomustine.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">As of May 5, 2019, 51 patients have
                             been enrolled, 35 patients at a starting dose of 40 mg/m2, and 16 patients at a starting dose of
                             30 mg/m<SUP>2</SUP>.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">For the 47 patients who have been on
                             study long enough to be assessed at the post-cycle 2 MRI:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">9/35 (25.7%) patients initially
                                    receiving 40 mg/m<SUP>2</SUP> exhibited &ldquo;Stable Disease&rdquo; per investigator assessment
                                    at the end of cycle 2</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">4/12 (33.3%) patients initially receiving
                             30 mg/m<SUP>2</SUP> exhibited &ldquo;Stable Disease&rdquo; per investigator assessment at the end
                             of cycle 2</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Additionally,
the study protocol has been amended to include enrollment of up to 24 newly-diagnosed GBM patients who have completed chemoradiation
treatment with TMZ and received no subsequent TMZ maintenance therapy but will receive VAL-083 instead (Group 2). This Group has
been included to explore whether earlier intervention with VAL-083 instead of TMZ maintenance therapy offers clinical benefit
and extends the time to recurrence as compared to TMZ maintenance therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consistent
with prior studies, myelosuppression (primarily thrombocytopenia and neutropenia) is the most common adverse event in both ongoing
clinical trials.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
Clinical Studies</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are currently developing VAL-083, a novel DNA-targeting agent for the treatment of GBM and potentially other solid tumors, including
ovarian cancer. Our recent research has highlighted the opportunities afforded by VAL-083&rsquo;s unique mechanism of action and
its potential to address unmet medical needs by focusing our development efforts on patients whose tumors exhibit biological features
that make them resistant to, or unlikely to respond to, currently available therapies. For example, our research demonstrating
VAL-083&rsquo;s activity in GBM is independent of the MGMT methylation status allows us to focus patient selection based on this
important biomarker.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
evaluation of MGMT promotor methylation status has increasingly become common practice in the diagnostic assessment of GBM. In
September 2017, the National Comprehensive Cancer Network (&ldquo;NCCN&rdquo;) updated guidelines for the standard treatment of
GBM based on MGMT methylation status. We believe these recently published guidelines provide for enhanced opportunities for us
to capitalize on VAL-083&rsquo;s unique mechanism of action by utilizing MGMT methylation as a biomarker to optimize patient selection
for our novel DNA-targeting agent to target the majority of GBM patients who are diagnosed with MGMT-unmethylated tumors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
current priority is to leverage this research and VAL-083&rsquo;s unique mechanism of action to efficiently advance our drug candidate
for the most promising indications, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">MGMT-unmethylated GBM, currently
                                    comprising two ongoing separate Phase 2 clinical studies for:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">rGBM patients (ongoing study at MDACC);
                             and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Newly diagnosed GBM patients
                                    (ongoing study at Sun Yat-sen University); and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 1in; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Based on published data from
                                    our Phase 2 studies being conducted at MDACC and in China, we have identified an additional
                                    opportunity in pre-temozolomide maintenance GBM patients, and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Potential future indications
                                    include ovarian cancer, non-small cell lung cancer (&ldquo;NSCLC&rdquo;), and other solid
                                    tumor indications.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>MGMT-unmethylated
GBM</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">GBM
is the most common and the most lethal form of glioma. According to the Central Brain Tumor Registry of the United States, GBM
occurs with an incidence of 3.20 per 100,000 person-years. Approximately 13,000 new cases of GBM were diagnosed in the United
States and 16,000 in Europe during 2017. Within the GBM patient population, approximately two-thirds of patients are unmethylated
with respect to their MGMT status.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Measurement
of MGMT (O6-methyl guanine methyltransferase) methylation status has become routine in clinical practice as a biomarker that correlates
with resistance to the standard-of-care chemotherapy with temozolomide (Temodar<SUP>&reg;</SUP> &ldquo;TMZ&rdquo;), and patient
outcomes in GBM. Greater than 60% of GBM patients&rsquo; tumors are characterized as &ldquo;MGMT-unmethylated&rdquo; and exhibit
a high expression of MGMT, a naturally occurring DNA-repair enzyme, the activity of which nullifies the chemotherapeutic activity
of TMZ. The development of new therapies for MGMT-unmethylated GBM is a significant unmet medical need. Importantly, the most
recent update to NCCN guidelines states that the treatment benefit of TMZ is likely to be lower in GBM patients with an unmethylated
MGMT promoter, and therefore, allows for withholding of TMZ in the treatment of newly diagnosed GBM patients with MGMT-unmethylated
tumors due to lack of efficacy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have demonstrated that VAL-083&rsquo;s anti-tumor mechanism is active independent from the MGMT status <I>in vitro</I>. We believe
this suggests the potential of VAL-083 as a replacement for the current standard-of-care chemotherapy, temozolomide, in MGMT-unmethylated
GBM. We are therefore utilizing MGMT-methylation status to identify GBM patients who are unlikely to respond to temozolomide and
instead treat them with VAL-083.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
believe that our research, in the context of the recent amendment to NCCN guidelines, highlights this unmet need and the opportunity
for VAL-083 as a potential new standard-of-care in the treatment of MGMT-unmethylated GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I><U>Phase
2 Study in MGMT-unmethylated rGBM in Collaboration with University of Texas MD Anderson Cancer&nbsp;Center</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
February 2017, we initiated a biomarker driven, open-label, single-arm Phase 2 study in collaboration with MDACC. This study will
enroll up to 48 MGMT-unmethylated GBM patients whose tumors have recurred following treatment with temozolomide. These patients
will not have been treated previously with Avastin<SUP>&reg;</SUP>. The primary endpoint of the study is overall survival. The
historical comparison survival data for this study is lomustine based on a median overall survival of 7.2 months in unmethylated
patients. Safety data from this study will become part of the overall safety dossier to support future filings with the FDA and
other regulatory agencies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of March 13, 2019, 47 patients had been enrolled in this Phase 2 study. The original starting dose of 40 mg/m<SUP>2</SUP> of VAL-083
on days 1, 2 and 3, of a 21-day cycle, which was based on the results from our previous Phase 1/2 safety study of VAL-083 in patients
with recurrent glioma (clinicaltrials.gov identifier: NCT01478178), has continued to demonstrate myelosuppression as the principal
side effect of VAL-083, as per prior clinical experience. The safety profile has been well within the existing safety monitoring
guidelines described in the present study protocol. However, in consultation with the principal investigator at MDACC, we have
amended the protocol for this clinical study to modify the starting dose of VAL-083 to 30 mg/m<SUP>2</SUP> on days 1, 2 and 3,
of a 21-day cycle for this specific population previously treated with temozolomide. This modification may improve tolerance in
this patient population and maximize overall exposure to VAL-083 thereby increasing the number of cycles of drug patients are
able to receive. We have modified the patient screening platelet count, from 100,000/&micro;L to 125,000/&micro;L, for the same
reasons.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">At
the AACR&rsquo;s annual meeting in April 2019, we reported that per investigator assessment at the end of cycle 2:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">9/35
                                         (25.7%) patients initially receiving 40 mg/m<SUP>2</SUP> exhibited Stable Disease</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">4/10
                                         (40.0%) patients initially receiving 30 mg/m<SUP>2</SUP> exhibited Stable Disease</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Two patients have not yet reached the
                             end of cycle 2</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
April 3, 2019, we announced that MDACC approved the adding of up to 35 patients to the recurrent GBM study at a dose of 30 mg/m<SUP>2</SUP>.
We had previously lowered the dose in this study from 40 mg/m<SUP>2</SUP> to 30 mg/m<SUP>2</SUP> to improve tolerance in this
patient population and maximize overall exposure to VAL-083 thereby increasing the number of cycles of drug patients are able
to receive. Upon completion of original 48 patients in this study, 13 will have had the 30 mg/m<SUP>2</SUP> dose and 35 will have
had the 40 mg/m<SUP>2</SUP>. Therefore, potentially adding an additional 35 patients at 30 mg/m<SUP>2</SUP> would result in a
total of 48 patients receiving the 30 mg/m<SUP>2 </SUP>dose. We are still determining how many, if any, additional patients will
be added at the 30 mg/m<SUP>2 </SUP>dose.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">It
is important for this GBM patient population, which has been heavily pre-treated with temozolomide, to be able to be treated with
multiple cycles of VAL-083 without significant hematological toxicities. We believe the modified dose of VAL-083, in addition
to the change in patient eligibility platelet counts, should help provide for enhanced patient safety. We believe a positive outcome
from this study can establish a position for VAL-083 in the treatment of MGMT-unmethylated rGBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on current enrollment rates, we are forecasting full enrollment in the second calendar quarter of 2019. Data from this study will
be used to help develop potential future clinical study designs with VAL-083 in MGMT-unmethylated rGBM. A detailed description
of this study can be found at clinicatrials.gov, Identifier Number: NCT02717962.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
noted above, patients in our current MDACC clinical study have been heavily pre-treated with temozolomide. Based on published
data from our MDACC and SYSUCC clinical studies, we believe there is a significant opportunity to treat GBM patients in the pre-temozolomide
maintenance stage. At the AACR&rsquo;s annual meeting in April 2019, we reported that myelosuppression (thrombocytopenia and neutropenia)
is the most common adverse event associated with VAL-083. The higher potential for myelosuppression with the 40 mg/m<SUP>2</SUP>/day
of VAL-083 in this study appears to be correlated with the number of cycles of prior TMZ maintenance therapy (&gt;&nbsp;5 cycles).
These patients will have had an initial cycle of temozolomide following radiation but will not have yet started subsequent cycles
of temozolomide (i.e. maintenance stage TMZ patients). The MDACC IRB has approved the addition of up to 24 patients to the pre-TMZ
maintenance setting. These patients will have had an initial cycle of temozolomide following radiation but will not have yet started
subsequent cycles of temozolomide (i.e. maintenance stage TMZ patients). Subject to obtaining financing and all regulatory approvals,
we are planning a new Phase 2 study that would potentially enroll up to 24 pre-TMZ maintenance stage, MGMT-unmethylated GBM patients.
The comparison survival data for this study is survival data from Tanguturi et al (2017 Nero-Oncology) for MGMT-unmethylated patients
of 6.9 months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I><U>Phase
2 Study in Newly Diagnosed MGMT-unmethylated GBM</U></I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
September 2017, we initiated a single arm, biomarker driven, open-label Phase 2 study in newly diagnosed MGMT-unmethylated GBM
patients at Sun Yat-sen University Cancer Center (SYSUCC) in Guangzhou, China. The study is being conducted under our collaboration
agreement with Guangxi Wuzhou Pharmaceutical Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
this Phase 2 study, VAL-083 is being combined with radiotherapy as a potential replacement for standard-of-care chemoradiation
with temozolomide in patients with MGMT-unmethylated GBM. One goal of the study will be to confirm the safety of the three-day
VAL-083 dosing regimen in combination with radiotherapy and to investigate outcomes of the combination of VAL-083 and radiotherapy
in MGMT-unmethylated GBM patients.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
plan to enroll up to 30 newly-diagnosed, MGMT-unmethylated GBM patients in this study. The efficacy endpoints of the study include
tumor response, as assessed by the Response Assessment in NeuroOncology (&ldquo;RANO&rdquo;), and progression-free survival (&ldquo;PFS&rdquo;),
progression-free survival at six months (&ldquo;PFS6&rdquo;), and overall survival (&ldquo;OS&rdquo;), compared to historical
results in the target population. The study is being conducted in two parts: (1) Dose-confirmation: VAL-083 in cohorts (20, 30
and 40 mg/m2/day IV daily x 3 every 21 days) to assess safety and activity when administered concurrently with x-ray therapy (&ldquo;XRT&rdquo;)
to confirm the maximum tolerated dose (&ldquo;MTD&rdquo;), and (2) Expansion: VAL-083 will be studied in up to 20 additional patients
at the target dose, as determined by the dose-confirmation part of the study, administered concurrently with XRT. Assessments
of safety and tolerability will be used to support further clinical development of VAL-083 in combination with radiotherapy. Pharmacokinetic
assessments of VAL-083 in plasma and cerebral spinal fluid (&ldquo;CSF&rdquo;) will be used to correlate drug exposure in the
central nervous system with patient outcomes.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dose
confirming cohorts studying 20, 30, and 40 mg/m<SUP>2</SUP>/day x three every 21 days have been completed. Based on the dose confirmation
phase of the study, we have selected 30 mg/m<SUP>2</SUP> for combination with irradiation for the treatment of newly-diagnosed
MGMT-unmethylated GBM patients.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of February 15, 2019, 15 patients have been enrolled in this study. The Company is pleased to report that for the 15 patients
enrolled to February 15, 2019, 11 have completed their prospectively planned Magnetic Resonance Imaging (MRI) scans and have had
their initial assessment for tumor progression. Tumor progression is based on the study investigator&rsquo;s clinical and radiologic
assessment, according to the RANO criteria. Of these 11 patients, five were assessed by the Principal Investigator as having a
&ldquo;Complete Response&rdquo;, three of whom were based on significant tumor shrinkage, and two of whom were based on their
tumors continuing to remain &ldquo;below measurable level&rdquo; from post-surgery baseline MRI to post-cycle 3 MRI. Additionally,
six patients were assessed as having &ldquo;Stable Disease.&rdquo; Of the remaining four patients, one died prior to their post-cycle
3 MRI and three have not been on study long enough to reach their planned post-cycle 3 MRI. As of the February 15, 2019 data cutoff,
12 of the 15 enrolled patients are still alive. Similar to prior experience, myelosuppression has been the most common adverse
event observed. Two dose-limiting toxicities have been reported (thrombocytopenia) &mdash; one at the 40 mg/m<SUP>2</SUP>/day
dose and one at the 30 mg/m<SUP>2</SUP>/day dose.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Through
our research, and that of the NCI, we have previously demonstrated that VAL-083 crosses the blood brain barrier. New preliminary
data from the SYSUCC study indicate that the concentration of VAL-083 is generally higher in CSF than in plasma at two hours post-infusion.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Concentration
of VAL-083 &mdash; Two Hours Post Dose</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><IMG SRC="img_002.jpg" ALT="" STYLE="width: 619px; height: 132px"></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By
comparison, temozolomide is typically 80% lower in the CSF than the plasma (Schreck et al. 2018, Oncology (Williston Park)). The
reason this is important is that accumulation of VAL-083 in the CSF further validates that VAL-083 crosses the blood-brain-barrier
and demonstrates that therapeutic drug concentrations in the CSF are achievable for extended periods of time.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Ovarian
Cancer</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
April 2016, the FDA granted orphan drug designation for the use of VAL-083 in the treatment of ovarian cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
September 2017, we filed an IND for the use of VAL-083 in ovarian cancer, along with a protocol for a Phase&nbsp;1/2, open-label,
multicenter, study of VAL-083 in patients with <B><U>Re</U></B>current <B><U>P</U></B>latinum <B><U>R</U></B>esistant <B><U>Ov</U></B>arian
Cancer (the REPROVe study).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
FDA has allowed this study to begin enrolling patients, but based on ongoing evaluation and input from our ovarian advisory board,
we are reassessing the ovarian cancer program. We are in the process of evaluating the best path forward in ovarian cancer and
are looking at various strategic options including combination with PARP inhibitors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Fast
Track Designation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
December 2017, the FDA granted Fast Track designation for VAL-083 in rGBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Fast
Track designation is designed to expedite the review of drugs that show promise in treating life-threatening diseases and address
unmet medical needs, with the goal of getting new treatments to patients earlier. Fast Track designation provides sponsors with
an opportunity for increased frequency for communication with the FDA to ensure an optimal development plan and to collect appropriate
data needed to support drug approval. Additional benefits of the Fast Track designation may include an Accelerated Approval, a
Priority Review, and a Rolling Review. Accelerated Approval is granted to drugs that demonstrate an effect on a surrogate, or
intermediate endpoints, reasonably likely to predict clinical benefit. Priority Review shortens the FDA review process for a new
drug from ten months to six months and is appropriate for drugs that demonstrate significant improvements in both safety and efficacy
of an existing therapy. Rolling Review provides a drug company the opportunity to submit completed sections of its New Drug Application
(&ldquo;NDA&rdquo;) for review by the FDA. Typically, NDA reviews do not commence until the drug company has submitted the entire
application to the FDA. Through the Fast Track designation, the FDA attempts to ensure that questions raised during the drug development
process are resolved quickly, often leading to earlier approval and increased access for patients.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Current
Treatments for Gliomas and Glioblastoma Multiforme</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Gliomas
are a type of Central Nervous System (&ldquo;CNS&rdquo;) tumor that arises from glial cells in the brain or spine. Glial cells
are the cells surrounding nerves. Their primary function is to provide support and protection for neurons in the CNS.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">GBM
is the most common and the most lethal form of glioma. According to the Central Brain Tumor Registry of The United States, GBM
occurs with an incidence of 3.20 per 100,000 person-years. Approximately 13,000 new cases of GBM were diagnosed in the United
States and 16,000 in Europe during 2017.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Common
symptoms of GBM include headaches, seizures, nausea, weakness, paralysis and personality or cognitive changes such as loss of
speech or difficulty in thinking clearly. GBM progresses quickly and patients&rsquo; conditions deteriorate rapidly progressing
to death. The outlook for GBM patients is generally poor. The overall median survival in newly diagnosed GBM patients with best
available treatments is less than 15 months, and two-year and five-year survival rates are approximately 30% and 10%, respectively.
Median overall survival in newly-diagnosed, unmethylated GBM patients is 12.2 months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
September 2017, the National Comprehensive Cancer Network (&ldquo;NCCN&rdquo;), updated treatment guidelines for GBM. The recommended
treatment regimen for GBM includes surgical resection to remove as much of the tumor as possible (&ldquo;debulking&rdquo;) followed
by radiotherapy with concomitant and adjuvant chemotherapy with temozolomide with or without tumor treating fields (&ldquo;TTF&rdquo;).
GBM patients whose tumors exhibit an unmethylated promotor for the gene encoding the DNA repair enzyme MGMT, a biomarker correlated
with resistance to temozolomide, may be treated with radiation alone following surgery.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Patients
with an unmethylated MGMT promotor have high levels of MGMT, a naturally-occurring DNA repair enzyme that repairs tumor-fighting
lesions induced by TMZ thus allowing a patient&rsquo;s tumor to continue to grow despite treatment which leads to poor outcomes.
Measurement of MGMT methylation status has become routine in clinical practice as biomarker that correlates with response to TMZ
and patient outcomes in GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Probability
of GBM Patient Survival Correlated to Expression of MGMT Enzyme<BR>
(Unmethylated promoter = High MGMT Expression and Significantly Shorter Survival)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; color: Red"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red"><IMG SRC="img_003.jpg" ALT=""></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">TTF
(Optune<SUP>&reg;</SUP>) is a non-invasive technique for adults with GBM. TTF uses alternating electrical fields to disrupt tumor
cell division, or cause cell death, thereby preventing the tumor from growing or spreading as quickly. A clinical study reported
that GBM patients treated with TTF combined with TMZ experienced longer survival than those treated with TMZ alone.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
majority of GBM patients&rsquo; tumors recur within 6 &ndash; 12 months of initial treatment. Experimental therapy through clinical
studies is recommended under NCCN guidelines for eligible patients. NCCN guidelines also recommend treatment with systemic chemotherapy,
such as lomustine (&ldquo;CCNU&rdquo;). For patients who are eligible for additional surgical debulking, local chemotherapy with
carmustine (&ldquo;BCNU&rdquo;) wafers may be employed. CCNU and BCNU target the same DNA-site as TMZ and are also subject to
MGMT-related resistance.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Avastin
(Avastin<SUP>&reg;</SUP>, an anti-VEGF antibody) recently received full approval in the US, Canada, Australia, and Japan as a
single agent for patients with recurrent GBM following prior therapy. Avastin carries an FDA &ldquo;black-box warning&rdquo; related
to severe, sometimes fatal, side effects such as gastrointestinal perforations, wound healing complications and hemorrhage. There
are no data demonstrating an improvement in disease-related symptoms or increased survival for GBM patients treated with Avastin.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Recurrent
GBM patients, especially those whose tumors progress following treatment with Avastin, have limited or no treatment options and
a very poor prognosis. According to published literature, the median survival for GBM patients whose tumors progress following
Avastin is less than five months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
Mechanism of Action and the Opportunity in the Treatment of Cancer</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chemotherapy
forms the basis of treatment in nearly all cancers. We believe that VAL-083 may be effective in treating tumors exhibiting biological
features that cause resistance to currently available chemotherapy, particularly for patients who have failed, or become resistant
to, other treatment regimens.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on published research and our own data, the cytotoxic functional groups, and the mechanism of action of VAL-083 are functionally
different from alkylating agents commonly used in the treatment of cancer. VAL-083 has previously demonstrated activity in cell-lines
that are resistant to other types of chemotherapy. No evidence of cross-resistance has been reported in published clinical studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
research suggests that VAL-083 attacks cancer cells via a unique mechanism of action which is distinct from other chemotherapies
used in the treatment of cancer. Our data indicate that VAL-083 forms inter-strand crosslinks at the N<SUP>7</SUP> position of
guanine on the DNA of cancer cells. Our data also indicate that this crosslink forms rapidly and is not easily repaired by the
cancer cell resulting in cell-cycle arrest and lethal double-strand DNA breaks in cancer cells. VAL-083 readily crosses the blood
brain barrier. Published preclinical and clinical research demonstrate that VAL-083 is absorbed more readily in tumor cells than
in normal cells.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>In
vitro</I>, our data also demonstrate that VAL-083&rsquo;s distinct mechanism may be able to overcome drug resistance against a
range of cancers. For example, VAL-083 is active against MGMT-unmethylated GBM cells which are resistant to treatment with temozolomide
and nitrosoureas. VAL-083 also retains a high level of activity in p53 mutated non-small cell lung cancer (&ldquo;NSCLC&rdquo;),
ovarian cancer and medulloblastoma cell lines that are resistant to platinum-based chemotherapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Importantly,
clinical activity against each of the tumors mentioned above was established in prior NCI-sponsored Phase 2 clinical studies.
We believe that these historical clinical data and our own research support the development of VAL-083 as a potential new treatment
for multiple types of cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
main dose-limiting toxicity (&ldquo;DLT&rdquo;) related to the administration of VAL-083 in previous NCI-sponsored clinical studies
and our own clinical studies is myelosuppression, particularly thrombocytopenia. Myelosuppression, including thrombocytopenia,
is a common side effect of chemotherapy. Myelosuppression is the decrease in cells responsible for providing immunity, carrying
oxygen, and causing normal blood clotting. Thrombocytopenia is a reduction in platelet counts which assist in blood clotting.
Modern medicine allows for better management of myelosuppressive side effects. We believe this offers the potential opportunity
to improve upon the drug&rsquo;s already established efficacy profile by substantially increasing the dose of VAL-083 that can
be safely administered to cancer patients.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
is no evidence of lung, liver, or kidney toxicity even with prolonged treatment by VAL-083. Data from the Chinese market where
the drug has been approved for more than 15 years supports the safety findings of the NCI studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
Historical Data</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">VAL-083
is first-in-class DNA targeting agent that readily crosses the blood-brain-barrier. Data from prior NCI-sponsored clinical studies
with VAL-083 demonstrate activity against GBM and other CNS tumors. In general, historical NCI-sponsored studies demonstrate that
tumor regression in brain cancer was achieved in 40% of patients treated and stabilization was achieved in an additional 20% to
30% of brain tumor patients following treatment with VAL-083. In these studies, VAL-083 demonstrated statistically significant
improvement in the median survival of high-grade glioma brain tumors, including GBM when combined with radiation versus radiation
alone (p &lt; 0.05) with results similar, or superior to, other chemotherapies approved for the treatment of GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>A
Summary of Published Data adapted from Separate Sources Comparing the Efficacy of VAL-083<BR>
and Other Therapies in the Treatment of GBM</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Comparative Therapy</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; padding-bottom: 1.5pt">Median Survival Benefit <BR> vs.</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 25%; font-weight: bold; text-align: center; padding-bottom: 1.5pt; border-bottom: Black 1.5pt solid">Chemotherapy</TD><TD STYLE="width: 1%; font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 24%; font-weight: bold; text-align: center; padding-bottom: 1.5pt; border-bottom: Black 1.5pt solid">Radiation (XRT) Alone</TD><TD STYLE="width: 1%; font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 24%; font-weight: bold; text-align: center; padding-bottom: 1.5pt; border-bottom: Black 1.5pt solid">Radiation + Chemotherapy</TD><TD STYLE="width: 1%; font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 24%; font-weight: bold; text-align: center; padding-bottom: 1.5pt; border-bottom: Black 1.5pt solid">XRT alone</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; font-style: italic; text-align: center">VAL-083 <BR> (Eagan 1979)</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center">8.4 months</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center">16.8 months</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center">8.4 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-style: italic; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Temozolomide (Temodar<SUP>&reg;</SUP>) </I><BR> <I>(Stupp 2005)</I></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">12.1 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">14.6 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2.5 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lomustine (CCNU) <BR> <I>(Walker 1976)</I></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">11.8 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">13 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">1.2 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Carmustine (BCNU) <BR> <I>(Reagan 1976)</I></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">10 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">12.5 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2.5 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Semustine (ACNU) <BR> <I>(Takakura 1986)</I></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">12 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">14 months</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2.0 months</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>VAL-083
is Active Independent of MGMT</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have presented data at several peer reviewed meetings demonstrating that VAL-083 is active independent of MGMT resistance in GBM
cell lines and other CNS tumor cells. Our research, along with that of others, demonstrates that VAL-083&rsquo;s unique cytotoxic
mechanism forms DNA cross-links at the N<SUP>7</SUP> position of guanine and retains cytotoxic activity independent of MGMT expression
<I>in vitro</I>. Our studies demonstrate that VAL-083 has more potent activity against brain tumor cells in comparison to TMZ
and overcomes resistance associated with MGMT, suggesting the potential to surpass the current standard-of-care in the treatment
of GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>A
Summary of Our Data Demonstrating that VAL-083&rsquo;s Anti-Tumor Mechanism is<BR>
Distinct from, and can Overcome, MGMT-Related Chemo resistance in the Treatment of GBM</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><IMG SRC="img_004.jpg" ALT="" STYLE="width: 450px; height: 228px"></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; color: Red"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, historical NCI clinical study data and our own research support the activity of VAL-083 as a potentiator of radiotherapy.
Radiotherapy in combination with temozolomide is the current standard of care in the treatment of newly diagnosed GBM. Our research
demonstrates that temozolomide and radiotherapy are ineffective against GBM cells exhibiting a high expression of MGMT, whereas
VAL-083 potentiates the tumor-killing effect of radiation independent of MGMT expression. Furthermore, the combination of VAL-083
and radiation has been demonstrated to be active against GBM cancer stem cells (&ldquo;CSCs&rdquo;) in vitro. CSCs are often resistant
to chemotherapy and form the basis for tumor recurrence and metastasis. GBM CSCs display strong resistance to TMZ, even where
MGMT expression is low. However, our data demonstrates that GBM CSCs are susceptible to VAL-083 independent of MGMT expression.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>A
Summary of Our Data Demonstrating that VAL-083 Maintains Activity in Both Temozolomide-resistant GBM Cell Lines and Matched Cancer
Stem Cells and Potentiates Radiotherapy</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;<IMG SRC="img_005.jpg" ALT="" STYLE="width: 580px; height: 229px"></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
believe that VAL-083&rsquo;s more potent activity against brain tumor cells in comparison to TMZ, VAL-083&rsquo;s ability to overcome
MGMT-mediated resistance, and its activity against GBM CSCs suggests the potential of VAL-083 to surpass the current standard-of-care
in the treatment of GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Phase
1 &ndash; 2 Clinical Study Overview and Summary of Results</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
an open-label, single arm dose-escalation study designed to evaluate the safety, tolerability, pharmacokinetics, and anti-cancer
activity of VAL-083, we enrolled forty-eight GBM patients whose disease progressed following prior treatment with temozolomide
and Avastin. The study was conducted at five centers in the United States: the Mayo Clinic in Rochester, Minnesota; the Brain
Tumor Center at University of California, San Francisco; the Sarah Cannon Cancer Research Center in Nashville, Tennessee and Denver,
Colorado; and the SCRI affiliate site at the Florida Cancer Specialist Research Institute in Sarasota, Florida.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Patients
received VAL-083 on days 1, 2 and 3 on a 21-day treatment cycle. The Phase 1 portion of the study involved dose escalation cohorts
until a maximum tolerated dose (&ldquo;MTD&rdquo;) was established at 40mg/m<SUP>2</SUP>. A further 14-patient, Phase 2 expansion
was then enrolled at the MTD to gather further safety data at our chosen therapeutic dose and to further explore the outcomes
in this patient population.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
May 2016, we held an end of Phase 2 meeting with the FDA in which we discussed with the FDA the design of a Phase 3, registration-directed
clinical program for VAL-083 in refractory GBM. Based on the input we received from the FDA, the agency confirmed that it would
consider the totality of data available, including data obtained from our other planned clinical studies in related GBM populations,
when assessing the NDA. The FDA also noted that we may be able to rely on prior NCI studies and historical literature to support
nonclinical data required for an NDA filing under a 505(b)(2) strategy which allows a sponsor to rely on already established safety
and efficacy data in support of an NDA.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
summary, the data from our previous Phase 1/2 study are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>Safety
and Tolerability</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
the Phase 1 dose escalation regimen, no serious adverse events (&ldquo;SAE&rdquo;) related to VAL-083 were encountered at doses
up to 40 mg/m<SUP>2</SUP>/day.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Increasing
frequency of, and higher grade, hematologic toxicities were observed at doses above 40 mg/m<SUP>2</SUP>/day. Consistent with the
published literature, the observed dose limiting toxicity for VAL-083 is primarily thrombocytopenia (low platelets). Observed
platelet nadir occurred at approximately day 18, and recovery was rapid and spontaneous following treatment.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on Phase 1 observations, fourteen additional patients were enrolled in a Phase 2 expansion cohort at 40mg/m<SUP>2</SUP>, which
was established as the MTD. Consistent with Phase 1, the dose of VAL-083 of 40 mg/m<SUP>2</SUP> on days 1, 2 and 3 of a 21-day
cycle was generally well tolerated in Phase 2. At this dose, one subject previously treated with CCNU, a nitrosourea agent, reported
severe (Grade 4) thrombocytopenia. As a result of this observation, the protocol inclusion criterion for platelet count was increased
from 100,000/&mu;L to 150,000/&mu;L for patients receiving prior nitrosoureas within 12 weeks preceding enrollment. No other dose
limiting toxicities were observed.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
Safety Observations from Phase 1/2 Clinical Study</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">Hematologic parameter and CTCAE grade</TD><TD STYLE="font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">dose</TD><TD STYLE="padding: 0; font-weight: bold; text-indent: 0">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&le;30 mg/m<SUP>2</SUP></B></FONT></TD><TD STYLE="padding: 0; font-weight: bold; text-indent: 0">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>40 mg/m<SUP>2</SUP></B></FONT></TD><TD STYLE="padding: 0; font-weight: bold; text-indent: 0">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>45 mg/m<SUP>2</SUP></B></FONT></TD><TD STYLE="padding: 0; font-weight: bold; text-indent: 0">&nbsp;</TD><TD STYLE="font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>50 mg/m<SUP>2</SUP></B></FONT></TD><TD STYLE="padding: 0; font-weight: bold; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">n =</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">20</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">17</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">4</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">7</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 0; padding: 0; width: 14.5%">Anemia</TD><TD STYLE="width: 0.5%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&le;G2</FONT></TD><TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 0.5%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; text-align: right; padding: 0; text-indent: 0">11</TD><TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 0.5%; font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; font-style: italic; text-align: right; padding: 0; text-indent: 0">55</TD><TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="width: 0.5%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; text-align: right; padding: 0; text-indent: 0">2</TD><TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 0.5%; font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; font-style: italic; text-align: right; padding: 0; text-indent: 0">12</TD><TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="width: 0.5%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; text-align: right; padding: 0; text-indent: 0">2</TD><TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 0.5%; font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; font-style: italic; text-align: right; padding: 0; text-indent: 0">50</TD><TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="width: 0.5%; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; text-align: right; padding: 0; text-indent: 0">6</TD><TD STYLE="width: 0.5%; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 0.5%; font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="width: 8%; font-style: italic; text-align: right; padding: 0; text-indent: 0">86</TD><TD STYLE="width: 0.5%; font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G3</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">2</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">10</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G4</FONT></TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 0; padding: 0">Leukopenia</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&le;G2</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">5</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">25</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">2</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">12</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">5</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">71</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G3</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">1</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">5</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">3</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">43</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G4</FONT></TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">2</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">50</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 0; padding: 0">Neutropenia</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&le;G2</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">4</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">20</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G3</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">3</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">43</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G4</FONT></TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">2</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">50</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">1</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">14</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 0; padding: 0">Thrombocytopenia</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&le;G2</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">9</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">45</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">3</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">18</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">3</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">43</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G3</FONT></TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&mdash;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">0</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">1</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">25</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">3</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right; padding: 0; text-indent: 0">43</TD><TD STYLE="font-style: italic; text-align: left; padding: 0; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">G4</FONT></TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">&mdash;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">0</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">1</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">6</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">2</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">50</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">1</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="font-style: italic; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; font-style: italic; text-align: right; text-indent: 0">14</TD><TD STYLE="padding: 0; font-style: italic; text-align: left; text-indent: 0">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: right; padding: 0; text-indent: 0">&nbsp;</TD><TD STYLE="text-align: left; padding: 0; text-indent: 0">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding: 0; text-indent: 0">DLT Observed</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: right; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">nil</FONT></TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: right; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">1</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: right; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">2</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: right; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; padding: 0; text-align: right; text-indent: 0">2</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: right; text-indent: 0">&nbsp;</TD><TD STYLE="padding: 0; text-align: left; text-indent: 0">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>Doses
Achieved</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
the results of our Phase 1/2 study, we confirmed that we achieved doses of VAL-083 that are higher than were utilized in the original
published NCI-sponsored clinical studies. A summary in comparison to the NCI&rsquo;s historical regimen is as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 20%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">Dosing Regimen &amp; Study</TD><TD STYLE="width: 1%; font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 19%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">Single Dose</TD><TD STYLE="width: 1%; font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 19%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">Acute Regimen <BR> (single cycle)</TD><TD STYLE="width: 1%; font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 19%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">Comparative <BR> Cumulative Dose <BR> (@ 35 days)</TD><TD STYLE="width: 1%; font-weight: bold; padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="width: 19%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid; padding: 0; text-indent: 0">Dose Intensity <BR> (dose per week)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">NCI GBM historical regimen <BR> <I>(Eagan et al)</I> <BR> daily x 5 q 5wks <BR> (cycle = 35 days)</FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">25&nbsp;mg/m<SUP>2</SUP></FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">x5&nbsp;days&nbsp;=&nbsp;125&nbsp;mg/m<SUP>2</SUP></FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">125&nbsp;mg/m<SUP>2</SUP></FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">25&nbsp;mg/m<SUP>2</SUP>/wk.</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center; padding: 0; text-indent: 0">DelMar VAL-083 achieved <BR> regimen daily x 3 q 3wks <BR> (cycle = 21 days)</TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">40&nbsp;mg/m<SUP>2</SUP></FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">x&nbsp;3&nbsp;days&nbsp;=&nbsp;120&nbsp;mg/m<SUP>2</SUP></FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">240&nbsp;mg/m&nbsp;<SUP>2</SUP></FONT></TD><TD STYLE="padding: 0; text-indent: 0">&nbsp;</TD>
    <TD STYLE="text-align: center; padding: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">40&nbsp;mg/m<SUP>2</SUP>/wk.</FONT></TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Daily
x 5 q 5wks refers to a dosing regimen of once per day for five consecutive days every five weeks (35-day cycle); while daily x
3 q 3wks refers to a dosing regimen of once per day for three consecutive days every three weeks (21-day cycle).</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
achieved dosing regimen increased the amount of VAL-083 delivered to the CNS over historical regimens without increased toxicity.
Thus, our regimen achieved both a higher maximum concentration and higher overall exposure, which we believe may increase the
likelihood of successful treatment outcomes in glioblastoma and other brain tumors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on our ongoing Phase 2 study at MDACC, we believe that the safety profile of the 40 mg/m<SUP>2</SUP> is within the existing safety
monitoring guidelines described in the present study protocol. However, in consultation with the principal investigator at MDACC,
we have amended the protocol for the study to modify the starting dose of VAL-083 to 30 mg/m<SUP>2</SUP> on days 1, 2 and 3, of
a 21-day cycle for this specific study population which has been previously treated with temozolomide. We believe this modification
may improve tolerance in this patient population and maximize overall exposure to VAL-083 thereby increasing the number of cycles
of drug patients are able to receive. The 30 mg/m<SUP>2 </SUP>dosing regimen is 20% over the historical regimen.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>Pharmacokinetics</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pharmacokinetic
(&ldquo;PK&rdquo;) analyses showed dose-dependent linear systemic exposure with a short (1-2h) plasma terminal half-life; average
Cmax at 40 mg/m<SUP>2</SUP>/day was 781 ng/mL (5.3&micro;M). The observed PK profile is comparable to published literature. Prior
NCI-sponsored studies demonstrated that VAL-083 readily crosses the blood brain barrier and has a long (&gt;20 hour) half-life
in the CNS.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
believe that this PK profile is optimal for the treatment of brain tumors: A long CNS half-life is expected to maximize exposure
of the drug in the brain increasing the likelihood of successful treatment outcomes, while a short plasma half-life is desirable
to minimize systemic side effects.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Observed
pharmacokinetics from VAL-083 Phase 1 clinical study dose vs. AUC</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red">&nbsp;<IMG SRC="img_006.jpg" ALT="" STYLE="width: 312px; height: 246px"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; color: Red"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on observed and previously published pharmacokinetics, we believe that therapeutic doses equal to, or above, 20 mg/m<SUP>2 </SUP>daily
on days 1, 2 and 3 of a 21-day cycle should deliver sufficient levels of VAL-083 to brain tumors to achieve a therapeutic benefit.
We are currently using a dose of 30 mg/m<SUP>2 </SUP>daily on days 1, 2 and 3 of a 21-day cycle in our two Phase 2 studies that
are currently ongoing.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>MGMT
&amp; IDH1</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">High
expression of MGMT and wild-type form of the enzyme isocitrate dehydrogenase (&ldquo;IDH1&rdquo;) have been previously shown to
be diagnostic markers that correlate with resistance to currently available chemotherapies (e.g. temozolomide or nitrosourea)
in the treatment of GBM and poor patient outcomes. Measurement of these biomarkers has become routine in clinical practice.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Notably,
we have previously demonstrated that VAL-083&rsquo;s anti-tumor mechanism is active independent from the MGMT status <I>in vitro</I>.
We believe we will ultimately be able to use such biomarkers in a prognostic fashion to select the patients most likely to respond
to treatment as we expand the clinical development of VAL-083.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Biomarker</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Observation in <BR> Phase 1/2 <BR> clinical study</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 88%; text-align: left; text-indent: -10pt; padding-left: 10pt">High MGMT (n=19)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">84</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">IDH-WT (n=11)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">90</TD><TD STYLE="text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I><U>Tumor
Response and Outcomes</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">GBM
patients in our Phase 1/2 clinical study were not re-resected prior to treatment with VAL-083 and therefore had a growing recurrent
GBM tumor at the time of enrollment. Patients were monitored for tumor response by MRI.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consistent
with un-resected GBM, median progression free survival (&ldquo;PFS&rdquo;) was short at 1.2 months (range: 0.2 &ndash; 20.1 months).
Five GBM patients treated with VAL-083 were reported to have stable disease as their best response following treatment; the remainder
reported progressive disease.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Disease
progression is typical in a refractory GBM population with non-resected tumors. However, we believe that slowed progression may
provide meaningful clinical benefit in this patient population through prolonged overall survival and improved quality of life.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">According
to published literature, GBM patients failing Avastin have a poor prognosis with expected survival under five months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Analysis
of twenty-two patients receiving an assumed therapeutic dose of VAL-083 (&ge;20mg/m<SUP>2</SUP>) demonstrated median survival
of 8.35 months following Avastin failure.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
compared to published literature</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 1%; padding-bottom: 1.5pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 31%; border-bottom: Black 1.5pt solid; font-weight: bold; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Reference</B></FONT></TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 33%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Post Avastin Salvage Therapy</TD><TD STYLE="width: 1%; font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 32%; font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Median Survival following <BR> Avastin Failure</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Shih (2016)</B></FONT></TD><TD STYLE="font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center">VAL-083</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center">8.35 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Rahman (2014)</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">nitrosourea</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4.3 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Mikkelson (2011)</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">TMZ + irinotecan</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4.5 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lu (2011)</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">dasatinib</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2.6 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Reardon (2011)</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">etoposide</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4.7 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Reardon (2011)</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">TMZ</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">2.9 months</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Iwomoto (2009)</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">various</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5.1 months</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">While
recognizing these data are representative of a relatively small, non-controlled Phase 1/2 clinical study, we believe these outcomes
support the potential of VAL-083 to offer meaningful clinical benefit to GBM patients who have failed Avastin, compared to currently
available therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>VAL-083
Historical Data and Our Research in Ovarian Cancer</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Ovarian
cancer is the fifth most common cancer in women and is the leading cause of death among women diagnosed with gynecological malignancies.
In 2016, approximately 22,300 women in the US were diagnosed with ovarian cancer and 14,300 died from their disease.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Without
treatment, ovarian cancer spreads within the pelvic region and metastasizes to distant sites such as the lungs, liver, spleen
and, rarely, the brain. The initial symptoms of ovarian cancer such as abdominal bloating, indigestion, pelvic pain, or nausea
are often attributed to symptoms caused by a less serious condition. Therefore, in most cases, ovarian cancer is not diagnosed
until it has progressed to an advanced stage when it is no longer possible to surgically remove all tumor tissue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">When
diagnosed at an advanced stage the 5-year survival rate is less than 40%. Women with ovarian cancer receive chemotherapy following
surgery to treat residual disease.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">VAL-083&rsquo;s
activity against ovarian epithelial adenocarcinoma (&ldquo;OEA&rdquo;) and squamous cell carcinoma of the cervix (&ldquo;SCC&rdquo;)
was reported in prior NCI-sponsored clinical studies. Importantly, NCI-researchers recommended VAL-083 for further advanced studies
in the treatment of ovarian cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pt-based
chemotherapy is employed in the treatment of nearly 50% of all cancer patients and is employed in the treatment regimen of nearly
all advanced-stage ovarian cancer patients. Ovarian cancer patients whose tumors are sensitive to Pt-based chemotherapy have the
most favorable outcome. Recently, the approval of PARP inhibitors in the treatment of ovarian cancer patients demonstrated improved
outcomes, particularly patients whose tumors remain sensitive to Pt-based treatments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pt-based
chemotherapies function by causing extensive damage to a cancer cell&rsquo;s DNA. Cancer cells are adept at overcoming DNA damage
or employing mechanisms to repair DNA damage induced by Pt-based chemotherapy. One of the most common obstacles to DNA-damaging
chemotherapy is mutations to a gene called p53. Cellular processes governed by the p53 gene are critical in assessing DNA damage
and determining if a cell should cease from dividing or self-destruct. When p53 does not function properly, cancer cells continue
to divide despite the treatment with DNA-damaging chemotherapy, making these drugs ineffective and leading to treatment resistance.
This occurs in nearly all cases of the most difficult ovarian cancer to treat &mdash; high grade serous ovarian cancer (HGSOC)
&mdash; which accounts for up to 70% of ovarian cancer cases and approximately 90% of ovarian cancer deaths. P53 mutations are
associated with resistance to Pt-based chemotherapy, which leads to treatment failure and increased mortality. Solving this problem
is a major goal in the development of new treatments for ovarian&nbsp;cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Unfortunately,
the development of resistance to Pt-based agents is nearly inevitable, leading to disease recurrence and increased mortality.
Ultimately, most women with advanced ovarian cancer develop recurrent disease with progressively shorter disease-free intervals.
Those whose tumors recur within 6 months of Pt-based therapy are considered Pt-resistant/refractory and have a very poor prognosis.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
response rate to second line therapy for Pt-resistant ovarian cancer patients is in the 10-15% range and overall survival is approximately
12 months. The development of new chemotherapies and targeted agents to overcome Pt resistance in ovarian cancer is a significant
unmet medical need.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have presented data demonstrating that VAL-083&rsquo;s distinct mechanism of action allows activity in tumors that are resistant
to other therapies. We have shown that cytotoxicity of VAL-083 against ovarian cancer is independent of sensitivity to cisplatin
or p53 status <I>in vitro.</I> We have demonstrated that VAL-083 is active in Pt-resistant ovarian cells harboring a range of
p53-mutations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
research has demonstrated that VAL-083 not only overcomes Pt resistance, but the combination of VAL-083 with Pt-based chemotherapy
displays synergy in multiple models <I>in vitro </I>and <I>in vivo.</I> This further suggests a distinct mechanism of action and
potential use as part of a VAL-083/Pt-combination therapy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><IMG SRC="img_007.jpg" ALT="" STYLE="width: 306px; height: 273px"></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; color: Red"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
combination of VAL-083 with either cisplatin <B>(A)</B> or oxaliplatin <B>(B)</B> in the human H460 (WT p53) NSCLC model demonstrated
significant super additivity (p&le;0.05) and/or synergism (CI&lt;1) for both combinations. This cytotoxic effect of VAL-083 in
combination with either platinum drug was observed also in A549 (WT p53) and H1975 (mutant p53) NSCLC cells, independently of
p53 status (not shown). Data, where applicable, are shown as mean &plusmn; SE; N=7.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif"><IMG SRC="img_008.jpg" ALT="" STYLE="width: 415px; height: 229px"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">While
Pt-based chemotherapy is the standard treatment for ovarian cancer, PARP inhibitors have recently provided a new treatment option
for a subset of patients with platinum-sensitive recurrent ovarian cancer. VAL-083 also demonstrates synergistic activity with
certain PARP inhibitors, including olaparib (Lynparza) and talazoparib <I>in vitro</I>, suggesting VAL-083 may have utility in
the treatment of ovarian cancer in combination with PARP inhibitors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center; color: Red"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><IMG SRC="img_009.jpg" ALT="" STYLE="width: 495px; height: 185px"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
believe that these data demonstrate the potential of VAL-083 to treat platinum-resistant ovarian cancers as a single-agent against
platinum-resistant tumors in combination with platinum-based chemotherapeutic regimens or in combination with PARP inhibitors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Other
Indications for VAL-083 &mdash; Potential Future Opportunities</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>VAL-083
in Lung Cancer</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lung
cancer is a leading cause of cancer death around the world and effective treatment for lung cancer remains a significant global
unmet need despite advances in therapy. Incidence of lung cancer in the United States is approximately 47 per 100,000 with the
majority (85%) being NSCLC, the most common type of lung cancer. Globally, the market for lung cancer treatment may exceed $24
billion by 2033 according to a report published by Evaluate Pharma.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
activity of VAL-083 against solid tumors, including lung cancer, has been established in both preclinical and human clinical studies
conducted by the NCI. DelMar has developed new nonclinical data to support the utility of VAL-083 in the modern treatment of lung
cancer. In an established murine xenograft model of NSCLC, the activity of VAL-083 was compared to standard platinum-based therapy
with cisplatin against human NSCLC cell lines A549 (TKI-sensitive) and H1975 (TKI-resistant). In the study, VAL-083 demonstrated
superior efficacy and safety in the treatment of TKI-susceptible (A549) tumors and in TKI-resistant (H1975) tumors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>Central
Nervous System Metastases of Solid Tumors</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
successful management of systemic tumors by modern targeted therapies has led to increased incidence of mortality due to CNS metastases
of lung cancer and other solid tumors. In June 2013, we split our Phase 1/2 clinical study protocol into two separate studies:
one focusing solely on refractory GBM and the other focusing on secondary brain cancers caused by other tumors that have spread
to the brain.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Based
on historical clinical activity and our own research, we believe that VAL-083 may be suitable for the treatment of patients with
CNS metastases who currently have limited treatment options. Subject to the availability of financial and operating resources,
we plan to develop a separate protocol for the continued exploration of VAL-083 in patients with secondary brain cancer caused
by a solid tumor spreading to the brain.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I><U>Pediatric
Brain Tumors</U></I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Tumors
of the brain and spine make up approximately 20 percent of all childhood cancers and they are the second most common form of childhood
cancer after leukemia.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
activity of VAL-083 against childhood and adolescent brain tumors has been established in both preclinical and human clinical
studies conducted by the NCI. We have presented data indicating that VAL-083 offers potential therapeutic alternatives for the
treatment of pediatric brain tumors including SHH-p53 mutated medulloblastoma. In March 2016, the FDA granted orphan drug designation
for the use of VAL-083 in the treatment of medulloblastoma. Subject to the availability of resources, we intend to collaborate
with leading academic researchers for the continued exploration of VAL-083 as a potential treatment of childhood brain tumors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Additional
Indications for VAL-083</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
historical studies sponsored by the NCI in the United States, VAL-083 exhibited clinical activity against a range of tumor types
including central nervous system tumors, solid tumors, and hematologic malignancies. We have established new nonclinical data
supporting the activity of VAL-083 in different types of cancer that are resistant to modern targeted therapies and we believe
that the unique cytotoxic mechanism of VAL-083 may provide benefit to patients in a range of indications. We intend to continue
to research these opportunities, and if appropriate, expand our clinical development efforts to include additional indications.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
Target Markets</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DNA-targeting
agents such as alkylating agents or platinum-based chemotherapy form the mainstay of chemotherapy treatments used in the treatment
of cancers. For example, TMZ had peak annual sales of $1.1 billion in 2010, while bendamustine, had peak annual sales of $0.8
billion in 2014.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
product candidate, VAL-083, is a first-in-class DNA targeting agent with a novel mechanism of action. VAL-083&rsquo;s anti-cancer
activity was established in a range of tumor types in prior NCI-sponsored clinical studies. Based on this novel mechanism, we
have demonstrated that the anti-cancer activity is maintained against tumor cells that are resistant to other DNA-targeting agents.
We believe this positions VAL-083 as a potential chemotherapy-of-choice for patients whose tumors are resistant to current standard-of-care
chemotherapy in orphan and major cancer indications.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
ongoing research and development activities are focused on indications where VAL-083 demonstrated promising activity in prior
NCI-sponsored studies and where our research suggests an opportunity to address significant unmet medical needs due to the failure
of existing treatments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt">VAL-083 target markets</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: center"><B>2024
                                         Estimated <BR> Global Sales</B></TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 83%; text-align: left; text-indent: -10pt; padding-left: 10pt">Glioblastoma multiforme (GBM)</TD><TD STYLE="width: 1%; font-style: italic">&nbsp;</TD>
    <TD STYLE="width: 1%; font-style: italic">&nbsp;</TD>
    <TD STYLE="width: 1%; font-style: italic; text-align: left">$</TD><TD STYLE="width: 13%; font-style: italic; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>1.5 B</I></FONT></TD><TD STYLE="width: 1%; font-style: italic; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Ovarian Cancer</TD><TD STYLE="font-style: italic">&nbsp;</TD>
    <TD STYLE="font-style: italic">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left">$</TD><TD STYLE="font-style: italic; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>4.2 B</I></FONT></TD><TD STYLE="font-style: italic; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Non-small cell lung cancer (NSCLC)</TD><TD STYLE="font-style: italic">&nbsp;</TD>
    <TD STYLE="font-style: italic">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left">$</TD><TD STYLE="font-style: italic; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>32.6 B</I></FONT></TD><TD STYLE="font-style: italic; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">&nbsp;</TD><TD STYLE="font-style: italic">&nbsp;</TD>
    <TD STYLE="font-style: italic">&nbsp;</TD>
    <TD STYLE="font-style: italic; text-align: left">&nbsp;</TD><TD STYLE="font-style: italic; text-align: right">&nbsp;</TD><TD STYLE="font-style: italic; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-style: italic; text-align: left; text-indent: -10pt; padding-left: 10pt">Source: Evaluate Pharma</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><U>Glioblastoma
Multiforme</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">GBM
is the most common and the most lethal form of glioma. According to the Central Brain Tumor Registry of The United States, GBM
occurs with an incidence of 3.20 per 100,000 person-years. Approximately 13,000 new cases of GBM were diagnosed in the United
States and 16,000 in Europe during 2017.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Newly
diagnosed patients suffering from GBM are initially treated through invasive brain surgery, although disease progression following
surgical resection is nearly 100%. Temozolomide (Temodar<SUP>&reg;</SUP>) in combination with radiation is the front-line therapy
for GBM following surgery. Global revenues of branded Temodar reached $1.1 billion in 2010. Approximately 60% of GBM patients
treated with Temodar<SUP>&reg;</SUP> experience tumor progression within one year. Median overall survival in newly-diagnosed,
unmethylated GBM patients is 12.2 months.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Bevacizumab
(Avastin<SUP>&reg;</SUP>) has been approved for the treatment of GBM in patients failing Temodar<SUP>&reg;</SUP>. In clinical
studies, approximately 20% of patients failing Temodar<SUP>&reg;</SUP> respond to Avastin<SUP>&reg;</SUP> therapy and no improvement
in median survival was reported.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
market for refractory (Avastin-failed) GBM is limited to those jurisdictions where Avastin is approved for the treatment of GBM.
The United States, Canada, Australia, Japan and Switzerland represent the major markets where Avastin is used in the treatment
of GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Ovarian
Cancer</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
American Cancer Society estimates that approximately 22,000 women will receive a new diagnosis of ovarian cancer and approximately
14,000 women will die from ovarian cancer in the United States each year. Ovarian cancer ranks fifth in cancer deaths among women,
accounting for more deaths than any other cancer of the female reproductive system.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
potential of VAL-083 in the treatment of ovarian cancer has been established in prior NCI-sponsored clinical studies and by our
recent research. The FDA has granted orphan drug status to VAL-083 as a potential treatment for ovarian cancer and we have recently
received notice of allowance for our IND to initiate a Phase 1-2 clinical study to investigate the safety and effectiveness of
VAL-083 in patients with recurrent platinum resistant ovarian cancer (VAL-083 REPROVe study).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Ovarian
cancers are commonly treated with a platinum-based chemotherapy regimen. Initial tumor response rates are relatively high. However,
the development of resistance to Pt-based chemotherapy in ovarian cancer patients is nearly inevitable. Our research suggests
that VAL-083 may offer a potential treatment option for ovarian cancer patients who are resistant to platinum-based chemotherapy
and as a potential combination therapy with other agents. We believe the profile of VAL-083 offers the potential to capture meaningful
market share in the multi-billion ovarian cancer market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Lung
Cancer</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lung
cancer is the most common cancer in the world with 1.8 million cases in 2012, representing 13% of all cancers. According to the
American Lung Association, lung cancer is the leading cancer killer in both men and women in the U.S. During 2018, an estimated
234,030 new cases of lung cancer were expected to be diagnosed.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
potential of VAL-083 in the treatment of NSLSC has been established in both human clinical studies conducted by the NCI and by
the drug&rsquo;s commercial approval in China. We believe the profile of VAL-083 offers the potential to capture meaningful market
share in the multi-billion NSCLC market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>VAL-083
Manufacturing</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">VAL-083
is a small-molecule chemotherapeutic. Chemical synthesis of the active pharmaceutical ingredient (&ldquo;API&rdquo;) was initially
established by the NCI. We have made improvements to this process and have obtained patents on these improvements. The current
manufacturing process involves fewer than five synthetic steps.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">VAL-083
drug product is a lyophilized (freeze-dried) formulation that is reconstituted for intravenous injection. We anticipate that overall
cost of goods for an eventual commercial product will be similar to other injectable, small-molecule pharmaceuticals.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Until
recently, supply of VAL-083 for our clinical studies has been provided through our collaboration with Guangxi Wuzhou Pharmaceutical
Company. Guangxi Wuzhou Pharmaceutical Company as a manufacturer has established a commercial-scale manufacturing process based
on the North American process originally developed for the NCI that has been licensed by the CFDA for commercial supply of VAL-083
in China. However, to-date, they have not achieved the quality of systems necessary to meet FDA manufacturing standards.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
address the need to meet FDA standards, we have engaged third-party contract manufacturers with the capabilities to establish
the processes, procedures and quality systems necessary to meet U.S., Canadian, E.U. and other international manufacturing requirements
in accordance with Good Manufacturing Practice (&ldquo;cGMP&rdquo;) regulations. We have now received drug supply manufactured
under full cGMP conditions. We intend to use this drug supply for all future clinical studies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have developed and patented certain intellectual property related to quality controls that are used in the release of VAL-083
for our clinical studies in the United States. This intellectual property is also required for product release under CFDA guidelines
and we have granted access to our intellectual property for this purpose.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Research
&amp; Development Collaborations</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Guangxi
Wuzhou Pharmaceutical Company</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to a memorandum of understanding and collaboration agreement, dated October 25, 2012, we have established a strategic collaboration
with Guangxi Wuzhou Pharmaceutical Company, a subsidiary of publicly traded Guangxi Wuzhou Zhongheng Group Co., Ltd. (SHG: 600252)
(the &ldquo;Guangxi Agreement&rdquo;). VAL-083 is approved for the treatment of chronic myelogenous leukemia (&ldquo;CML&rdquo;)
and lung cancer in China and Guangxi Wuzhou Pharmaceutical Company is the only manufacturer licensed by the CFDA to produce the
product for the China market. Through the Guangxi Agreement, we have been provided drug product at the production price for our
VAL-083 clinical studies in the United States and China and we have also secured certain commercial rights in China.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the Guangxi Agreement, we granted to Guangxi Wuzhou Pharmaceutical Company a royalty-free license to certain of our intellectual
property, as it relates to quality control and drug production methods for VAL-083, and we agreed that Guangxi Wuzhou Pharmaceutical
Company will be our exclusive supplier of VAL-083 for clinical studies and commercial sales, subject to Guangxi Wuzhou Pharmaceutical
Company obtaining and maintaining cGMP certification by the FDA, EMA or other applicable regulatory agencies, and Guangxi Wuzhou
Pharmaceutical Company being able to meet volumes ordered by us. We will continue to work with Guangxi Wuzhou Pharmaceutical Company
to achieve US FDA compliance in order to potentially have them as our future supplier for global sales of VAL-083.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">This
Guangxi Agreement also provides us with certain exclusive commercial rights related to drug supply. Specifically, the Guangxi
Agreement establishes an exclusive supply relationship between us and Guangxi Wuzhou Pharmaceutical Company for the Chinese market
and all markets outside China. Guangxi Wuzhou Pharmaceutical Company agreed that it may not sell VAL-083 for markets outside of
China to any other purchaser other than us, provided that, during the first three years following regulatory clearance for marketing
of VAL-083 in a particular country or region, we meet proposed sales volumes set by Guangxi Wuzhou Pharmaceutical Company for
the country or region. In addition, Guangxi Wuzhou Pharmaceutical Company granted us a pre-emptive right in China (subject to
our acceptance of proposed sales volume and prices) to purchase VAL-083 produced by Guangxi Wuzhou Pharmaceutical Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
term of the Guangxi Agreement (except as it relates to the exclusive rights in the China market) is indefinite, subject to termination
upon written agreement of all parties, or if either party breaches any material term and fails to remedy such breach within 30
days of receipt of notice of the breach, or if any action to be taken thereunder is not agreed to by both parties, provided that
such matter is referred to the chief executive officer of both parties, and they are unable to resolve such matter within 90 days.
No payments have been made to date under the Guangxi Agreement.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Duke
University Collaboration</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
April 2017, we entered into a three-year collaboration with Duke University to evaluate VAL-083 as a front-line treatment for
newly diagnosed patients with GBM. Under the terms of the collaboration, we will fund a series of preclinical studies to be conducted
by Duke University&rsquo;s Glioblastoma Drug Discovery Group to identify molecular characteristics of GBM tumors that are more
likely to respond to VAL-083, and not the standard of care, temozolomide, as a front-line treatment or through combination therapies.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patents
and Proprietary Rights</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
success will depend in part on our ability to protect our existing product candidate and the products we acquire or license by
obtaining and maintaining a strong proprietary position. To develop and maintain our position, we intend to continue relying upon
patent protection, orphan drug status, Hatch-Waxman exclusivity, trade secrets, know-how, continuing technological innovations
and licensing opportunities.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have filed patent applications claiming the use of, and improvements related to VAL-083. Our patent filings also include proposed
treatment regimens, improvements to the manufacturing process, formulation and composition of the active pharmaceutical ingredient,
and finished dosage forms of VAL-083. We are prosecuting our patent applications in the United States and other jurisdictions
which we deem important for the potential commercial success of VAL-083.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
patents and patent applications can be summarized in fourteen series as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series I is generally directed
                                    to synthesis of VAL-083.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 8,563,758</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 8,921,585</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,085,544</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,630,938</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2011/048032</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol. National phase applications pending and granted in various
    countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2031</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         II is generally directed to use of VAL-083 to treat a range of diseases and conditions,
                                         including but not limited to malignancies.</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,066,918</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Compositions
    And Methods To Improve The Therapeutic Benefit Of Suboptimally Administered Chemical Compounds Including Substituted Hexitols
    Such As Dianhydrogalactitol And Diacetyldianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,901,563</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Compositions
    And Methods To Improve The Therapeutic Benefit Of Suboptimally Administered Chemical Compounds Including Substituted Hexitols
    Such As Dianhydrogalactitol And Diacetyldianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2011/048031</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Compositions
    And Methods To Improve The Therapeutic Benefit Of Suboptimally Administered Chemical Compounds Including Substituted Hexitols
    Such As Dianhydrogalactitol And Diacetyldianhydrogalactitol. National phase applications pending.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2031</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         III is generally directed to analytical methods for VAL-083.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; border-top: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,759,698</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 10,145,824</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,029,164</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/IB2013/000793</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol. National phase applications pending and
    granted in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2033</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; border-top: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2014/066087</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol. National phase applications pending in
    various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2034</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         IV is generally directed to the use of VAL-083 to treat GBM or medulloblastoma.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 5pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 16/242,752</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,687,466</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 10,201,521</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2013/022505</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma. National phase applications pending in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2033</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         V is generally directed to the veterinary use of VAL-083.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent No. 9,814,693</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Veterinary
    Use Of Dianhydrogalactitol, Diacetyldianhydrogalactitol, And Dibromodulcitol To Treat Malignancies</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         VI is generally directed to the use of VAL-083 to treat tyrosine-kinase-inhibitor-resistant
                                         malignancies.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 14/409,909</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Methods
    For Treating Tyrosine-Kinase-Inhibitor-Resistant Malignancies In Patients With Genetic Polymorphisms Or Ahi1 Dysregulations
    Or Mutations Employing Dianhydrogalactitol, Diacetyldianhydrogalactitol, Dibromodulcitol, Or Analogs Or Derivatives Thereof</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2013/047320</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Methods
    For Treating Tyrosine-Kinase-Inhibitor-Resistant Malignancies In Patients With Genetic Polymorphisms Or Ahi1 Dysregulations
    Or Mutations Employing Dianhydrogalactitol, Diacetyldianhydrogalactitol, Dibromodulcitol, Or Analogs Or Derivatives Thereof.
    National phase applications pending in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2033</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series VII is generally directed
                                    to the use of VAL-083 to treat recurrent malignant glioma and progressive secondary brain
                                    tumor.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No.&nbsp;14/682,226</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    Of Dianhydrogalactitol And Analogs And Derivatives Thereof To Treat Recurrent Malignant Glioma Or Progressive Secondary Brain
    Tumor</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Application Serial No. <BR>
    PCT/US2014/040461</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    Of Dianhydrogalactitol And Analogs And Derivatives Thereof To Treat Recurrent Malignant Glioma Or Progressive Secondary Brain
    Tumor. National phase applications pending and granted in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2034</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series VIII is generally directed to
                             the use of VAL-083 to treat non-small-cell lung cancer.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.25pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.25pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 14/710,240</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    of Dianhydrogalactitol and Analogs or Derivatives Thereof in Combination With Platinum-Containing Antineoplastic Agents to
    Treat Non Small-Cell Carcinoma of the Lung and Brain Metastases</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2015/024462</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    of Dianhydrogalactitol and Analogs or Derivatives Thereof to Treat Non-Small Cell Carcinoma of the Lung and Ovarian Cancer.
    National phase applications pending in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2035</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2016/032120</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Combination
    of Analogs or Derivatives of Dianhydrogalactitol with Platinum-Containing Antineoplastic Agents to Treat Cancer. National
    phase applications pending in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2035</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;
Series IX is generally directed to the use of VAL-083 and radiation to treat NSCLC and GBM.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 15/525,933</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dianhydrogalactitol
    Together with Radiation to Treat Non-Small-Cell Carcinoma of the Lung and Glioblastoma Multiforme.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2015/059814</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dianhydrogalactitol
    Together with Radiation to Treat Non-Small-Cell Carcinoma of the Lung and Glioblastoma Multiforme. National phase applications
    pending in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2035</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         X is generally directed to the use of VAL-083 in NSCLC and ovarian cancer:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 15/759,104</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    of Dianhydrogalactitol And Derivatives Thereof in the Treatment of Glioblastoma, Lung Cancer and Ovarian Cancer.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         XI is generally directed to the use of VAL-083 in the treatment of CNS malignancies:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 15/624,200</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    of Dianhydrogalactitol or Derivatives and Analogs Thereof for Treatment of Pediatric Central Nervous System Malignancies.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 15/771,631</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    of Dianhydrogalactitol or Derivatives and Analogs Thereof for Treatment of Pediatric Central Nervous System Malignancies.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series XII is generally directed
                                    to the analysis and resolution of VAL-083 preparations:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">United
    States Patent Application Serial No. 15/778,546</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Methods
    for analysis and Resolution of Preparations of Dianhydrogalactitol and Derivatives and Analogs Thereof.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. <BR>
    PCT/US2016/063362</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Methods
    for analysis and Resolution of Preparations of Dianhydrogalactitol and Derivatives and Analogs Thereof. National phase applications
    pending in various countries.</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-top: 4pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2036</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         XIII is generally directed to combinations:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">PCT
    Patent Application Serial No. PCT/US2018/020314</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Use
    of Dianhydrogalactitol and Analogs and Derivatives in Combination with a P53 Modulator or a PARP Inhibitor</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2038</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Series
                                         XIV &mdash; PCT</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif; padding-right: 3pt; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Patent
    or Patent Application No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 47%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">One
    PCT is currently pending</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">One
of the inventors listed in our Series IX applications is an employee of the University of California, San Francisco. If a patent
issues from a patent application in this series with a claim that the University of California employee conceived of, in whole
or in part, then the Regents of the University of California will share ownership of any such patent with us. Our research agreements
with the University of California address this issue by providing us with an exclusive option, for a limited period of time, to
negotiate a royalty-bearing exclusive license for commercialization of the invention covered by that patent.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to patent protection, we may also seek orphan drug status whenever it is available. If a product which has an orphan
drug designation subsequently receives the first regulatory approval for the indication for which it has such designation, the
product is entitled to orphan exclusivity, meaning that the applicable regulatory authority may not approve any other applications
to market the same drug for the same indication, except in very limited circumstances, for a period of seven years in the U.S.
and Canada, and 10 years in the E.U. Orphan drug designation does not prevent competitors from developing or marketing different
drugs for the same indication or the same drug for a different clinical indication.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">VAL-083
has been granted protection under the Orphan Drug Act by the FDA and the European Medicines Agency for the treatment of gliomas,
including GBM. The FDA has also granted Orphan Drug protection to VAL-083 for the treatment of medulloblastoma and ovarian cancer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
February 2012, the FDA granted orphan drug status to VAL-083 for the treatment of glioma. In January 2013, the EMA also granted
orphan drug protection to VAL-083 for the treatment of glioma. In the spring of 2016, the FDA Office of Orphan Products Development
granted orphan drug designations to VAL-083 for the treatment of ovarian cancer and medulloblastoma.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to our patents and orphan drug protection, we intend to rely on the Hatch-Waxman Amendments for five years of data exclusivity
for VAL-083.Under the Hatch-Waxman Amendments, newly approved drugs and indications benefit from a statutory period of non-patent
marketing exclusivity. These amendments provide five-year data exclusivity to the first applicant to gain approval of an NDA for
a new chemical entity, meaning that the FDA has not previously approved any other new drug containing the same active ingredient.
The Hatch-Waxman Amendments prohibit the approval of an abbreviated new drug application, also known as an ANDA or generic drug
application, during the five-year exclusive period if no patent is listed. If there is a patent listed and the ANDA applicant
certifies that the NDA holder&rsquo;s listed patent for the product is invalid or will not be infringed, the ANDA can be submitted
four years after NDA approval. Protection under the Hatch-Waxman Amendments will not prevent the filing or approval of another
full NDA; however, the applicant would be required to conduct its own pre-clinical studies and adequate and well-controlled clinical
studies to demonstrate safety and effectiveness. The Hatch-Waxman Amendments also provide three years of data exclusivity for
the approval of NDAs with new clinical studies for previously approved drugs and supplemental NDAs, for example, for new indications,
dosages or strengths of an existing drug, if new clinical investigations were conducted by or on behalf of the sponsor and were
essential to the approval of the application. This three-year exclusivity covers only the new changes associated with the supplemental
NDA and does not prohibit the FDA from approving ANDAs for drugs containing the original active ingredient.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
also rely on trade secret protection for our confidential and proprietary information. We believe that the substantial costs and
resources required to develop technological innovations, such as the manufacturing processes associated with VAL-083, will help
us to protect the competitive advantage of our product candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
protection of intellectual property rights in China (where our clinical product candidate, VAL-083, is manufactured pursuant to
a collaboration agreement with the only manufacturer presently licensed by the CFDA to produce the product for the China market,
and where VAL-03 is approved for the treatment of CML and lung cancer) is relatively weak compared to the United States, which
may negatively affect our ability to generate revenue from VAL-083 in China.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
policy is to require 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. These agreements provide
that all confidential information developed or made known to the individual during the course of the individual&rsquo;s relationship
with us is to be kept confidential and not disclosed to third parties except in specific circumstances. In the case of employees
and consultants, the agreements provide that all inventions conceived by the individual shall be our exclusive property.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Government
Regulation and Product Approval</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Regulation
by governmental authorities in the U.S. and other countries is a significant factor, affecting the cost and time of our research
and product development activities, and will be a significant factor in the manufacture and marketing of any approved products.
Our product candidates will require regulatory approval by governmental agencies prior to commercialization. In particular, our
products are subject to rigorous preclinical and clinical testing and other approval requirements by the FDA and similar regulatory
authorities in other countries. Various statutes and regulations also govern or influence the manufacturing, safety, reporting,
labeling, transport and storage, record keeping and marketing of our products. The lengthy process of seeking these approvals,
and the subsequent compliance with applicable statutes and regulations, require the expenditure of substantial resources. Any
failure by us to obtain, or any delay in obtaining, the necessary regulatory approvals could harm our business.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
regulatory requirements relating to the testing, manufacturing and marketing of our products may change from time to time and
this may impact our ability to conduct clinical studies and the ability of independent investigators to conduct their own research
with support from us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
clinical development, manufacturing and marketing of our products are subject to regulation by various authorities in the U.S.,
the E.U. and other countries, including, in the U.S., the FDA, in Canada, Health Canada, and, in the E.U., the EMA. The Federal
Food, Drug, and Cosmetic Act, the Public Health Service Act in the U.S. and numerous directives, regulations, local laws and guidelines
in Canada and the E.U. govern the testing, manufacture, safety, efficacy, labeling, storage, record keeping, approval, advertising
and promotion of our products. Product development and approval within these regulatory frameworks takes a number of years and
involves the expenditure of substantial resources.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Regulatory
approval will be required in all the major markets in which we seek to develop our products. At a minimum, approval requires the
generation and evaluation of data relating to the quality, safety, and efficacy of an investigational product for its proposed
use. The specific types of data required and the regulations relating to this data will differ depending on the territory, the
drug involved, the proposed indication and the stage of development.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
general, new chemical entities are tested in animals until adequate evidence of safety is established to support the proposed
clinical study protocol designs. Clinical studies for new products are typically conducted in three sequential phases that may
overlap. In Phase 1, the initial introduction of the pharmaceutical into either healthy human volunteers or patients with the
disease (20 to 50 subjects), the emphasis is on testing for safety (adverse effects), dosage tolerance, metabolism, distribution,
excretion and clinical pharmacology. Phase 2 involves studies in a limited patient population (50 to 200 patients) to determine
the initial efficacy of the pharmaceutical for specific targeted indications, to determine dosage tolerance and optimal dosage
and to identify possible adverse side effects and safety risks. Once a compound shows preliminary evidence of some effectiveness
and is found to have an acceptable safety profile in Phase 2 evaluations, Phase 3 studies are undertaken to more fully evaluate
clinical outcomes in a larger patient population in adequate and well-controlled studies designed to yield statistically sufficient
clinical data to demonstrate efficacy and safety.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
the U.S., specific preclinical data, manufacturing and chemical data, as described above, need to be submitted to the FDA as part
of an IND application, which, unless the FDA objects, will become effective 30 days following receipt by the FDA. Phase 1 studies
in human volunteers may commence only after the application becomes effective. Prior regulatory approval for human healthy volunteer
studies is also required in member states of the E.U. Currently, in each member state of the E.U., following successful completion
of Phase 1 studies, data are submitted in summarized format to the applicable regulatory authority in the member state in respect
of applications for the conduct of later Phase 2 studies. The regulatory authorities in the E.U. typically have between one and
three months in which to raise any objections to the proposed study, and they often have the right to extend this review period
at their discretion. In the U.S., following completion of Phase 1 studies, further submissions to regulatory authorities are necessary
in relation to Phase 2 and 3 studies to update the existing IND.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Authorities
may require additional data before allowing the studies to commence and could demand that the studies be discontinued at any time
if there are significant safety issues. In addition to the regulatory review, studies involving human subjects must be approved
by an independent body. The exact composition and responsibilities of this body will differ from country to country. In the U.S.,
for example, each study will be conducted under the auspices of an independent institutional review board (IRB) at each institution
at which the study is conducted. The IRB considers among other things, the design of the study, ethical factors, the privacy of
protected health information as defined under the Health Insurance Portability and Accountability Act, the safety of the human
subjects and the possible liability risk for the institution. Equivalent rules to protect subjects&rsquo; rights and welfare apply
in each member state of the E.U. where one or more independent ethics committees, which typically operate similarly to an IRB,
will review the ethics of conducting the proposed research. Other regulatory authorities around the rest of the world have slightly
differing requirements involving both the execution of clinical studies and the import/export of pharmaceutical products. It is
our responsibility to ensure we conduct our business in accordance with the regulations of each relevant territory.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
order to gain marketing approval, we must submit a dossier to the relevant authority for review, which is known in the U.S. as
a new drug application (NDA) and in the E.U. as a marketing authorization application (MAA). The format is usually specific and
laid out by each authority, although in general it will include information on the quality of the chemistry, manufacturing and
pharmaceutical aspects of the product as well as the nonclinical and clinical data. Once the submitted NDA is accepted for filing
by the FDA, it undertakes the review process that currently takes on average 10 months, unless an expedited priority review is
granted which takes six months to complete. Approval can take several months to several years, if multiple 10-month review cycles
are needed before final approval is obtained, if at all.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
approval process can be affected by a number of factors. The NDA may require additional preclinical, manufacturing data or clinical
studies which may be requested at the end of the 10-month NDA review cycle, thereby delaying approval until additional data are
submitted and may involve substantial unbudgeted costs.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to obtaining approval for each product, in many cases each drug manufacturing facility must be approved. The regulatory
authorities usually will conduct an inspection of relevant manufacturing facilities, and review manufacturing procedures, operating
systems and personnel qualifications. Further inspections may occur over the life of the product. An inspection of the clinical
investigation sites by a competent authority may be required as part of the regulatory approval procedure. As a condition of marketing
approval, the regulatory agency may require post-marketing surveillance to monitor for adverse effects or other additional studies
as deemed appropriate. After approval for the initial indication, further clinical studies may be necessary to gain approval for
any additional indications. The terms of any approval, including labeling content, may be more restrictive than expected and could
affect the marketability of a product.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
FDA offers a number of regulatory mechanisms that provide expedited or accelerated approval procedures for selected drugs in the
indications on which we are focusing our efforts. These include accelerated approval under Subpart H of the agency&rsquo;s NDA
approval regulations, fast track drug development procedures, breakthrough drug designation and priority review. At this time,
we have not determined whether any of these approval procedures will apply to our current drug candidate.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By
leveraging existing preclinical and clinical safety and efficacy data, we seek to build upon an existing knowledge base to accelerate
our research. In addition, through our focus on end-stage population which has no current treatment options, regulatory approval
for commercialization may sometimes be achieved in an accelerated manner. Accelerated approval by the FDA in this category may
be granted on objective response rates and duration of responses rather than demonstration of survival benefit. As a result, studies
of drugs to treat end-stage refractory cancer indications have historically involved fewer patients and generally have been faster
to complete than studies of drugs for other indications. We are aware that the FDA and other similar agencies are regularly reviewing
the use of objective endpoints for commercial approval and that policy changes may impact the size of studies required for approval,
timelines and expenditures significantly.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
U.S., E.U. and other jurisdictions may grant orphan drug designation to drugs intended to treat a &ldquo;rare disease or condition,&rdquo;
which, in the U.S., is generally a disease or condition that affects no more than 200,000 individuals. In the E.U., orphan drug
designation can be granted if: the disease is life threatening or chronically debilitating and affects no more than 50 in 100,000
persons in the E.U.; without incentive, it is unlikely that the drug would generate sufficient return to justify the necessary
investment; and no satisfactory method of treatment for the condition exists or, if it does, the new drug will provide a significant
benefit to those affected by the condition. If a product that has an orphan drug designation subsequently receives the first regulatory
approval for the indication for which it has such designation, the product is entitled to orphan exclusivity, meaning that the
applicable regulatory authority may not approve any other applications to market the same drug for the same indication, except
in very limited circumstances, for a period of seven years in the U.S. and 10 years in the E.U. Orphan drug designation does not
prevent competitors from developing or marketing different drugs for the same indication or the same drug for different indications.
Orphan drug designation must be requested before submitting an NDA or MAA. After orphan drug designation is granted, the identity
of the therapeutic agent and its potential orphan use are publicly disclosed. Orphan drug designation does not convey an advantage
in, or shorten the duration of, the review and approval process. However, this designation provides an exemption from marketing
and authorization fees charged to NDA sponsors under the Prescription Drug Act (PDUFA Fees).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Maintaining
substantial compliance with appropriate federal, state and local statutes and regulations requires the expenditure of substantial
time and financial resources. Drug manufacturers are required to register their establishments with the FDA and certain state
agencies, and after approval, the FDA and these state agencies conduct periodic unannounced inspections to ensure continued compliance
with ongoing regulatory requirements, including cGMPs. In addition, after approval, some types of changes to the approved product,
such as adding new indications, manufacturing changes and additional labeling claims, are subject to further FDA review and approval.
The FDA may require post-approval testing and surveillance programs to monitor safety and the effectiveness of approved products
that have been commercialized. Any drug products manufactured or distributed by us pursuant to FDA approvals are subject to continuing
regulation by the FDA, including:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left">&#9679;</TD><TD>record-keeping requirements;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">reporting of adverse experiences with
                             the drug;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">providing the FDA with updated
                                    safety and efficacy information;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">reporting on advertisements and promotional
                             labeling;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">drug sampling and distribution
                                    requirements; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">complying with electronic record and
                             signature requirements.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, the FDA strictly regulates labeling, advertising, promotion and other types of information on products that are placed
on the market. There are numerous regulations and policies that govern various means for disseminating information to health-care
professionals as well as consumers, including to industry sponsored scientific and educational activities, information provided
to the media and information provided over the Internet. Drugs may be promoted only for the approved indications and in accordance
with the provisions of the approved label.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
FDA has very broad enforcement authority and the failure to comply with applicable regulatory requirements can result in administrative
or judicial sanctions being imposed on us or on the manufacturers and distributors of our approved products, including warning
letters, refusals of government contracts, clinical holds, civil penalties, injunctions, restitution and disgorgement of profits,
recall or seizure of products, total or partial suspension of production or distribution, withdrawal of approvals, refusal to
approve pending applications, and criminal prosecution resulting in fines and incarceration. The FDA and other agencies actively
enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted
off-label uses may be subject to significant liability. In addition, even after regulatory approval is obtained, later discovery
of previously unknown problems with a product may result in restrictions on the product or even complete withdrawal of the product
from the market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Sales
of our product candidates, if approved, will depend, in part, on the extent to which such products will be covered by third-party
payors, such as government health care programs, commercial insurance and managed healthcare organizations. These third-party
payors are increasingly limiting coverage or reducing reimbursements for medical products and services. In addition, the U.S.
government, state legislatures and foreign governments have continued implementing cost-containment programs, including price
controls, restrictions on reimbursement and requirements for substitution of generic products. Third-party payors decide which
therapies they will pay for and establish reimbursement levels. Third-party payors often rely upon Medicare coverage policy and
payment limitations in setting their own coverage and reimbursement policies. However, decisions regarding the extent of coverage
and amount of reimbursement to be provided for any drug candidates that we develop will be made on a payor-by-payor basis. Each
payor determines whether or not it will provide coverage for a therapy, what amount it will pay the manufacturer for the therapy,
and on what tier of its formulary it will be placed. The position on a payor&rsquo;s list of covered drugs, or formulary, generally
determines the co-payment that a patient will need to make to obtain the therapy and can strongly influence the adoption of such
therapy by patients and physicians. 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. Decreases in third-party
reimbursement for our product candidates or a decision by a third-party payor to not cover our product candidates could reduce
physician usage of our product candidates, once approved, and have a material adverse effect on our sales, results of operations
and financial condition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Because
of our current and future arrangements with healthcare professionals, principal investigators, consultants, customers and third-party
payors, we will also be subject to healthcare regulation and enforcement by the federal government and the states and foreign
governments in which we will conduct our business, including our clinical research, proposed sales, marketing and educational
programs. Failure to comply with these laws, where applicable, can result in the imposition of significant civil penalties, criminal
penalties, or both. The U.S. laws that may affect our ability to operate, among others, include: the federal Health Insurance
Portability and Accountability Act of 1996, or HIPAA, as amended by the Health Information Technology for Economic and Clinical
Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected
health information; certain state laws governing the privacy and security of health information in certain circumstances, some
of which are more stringent than HIPAA and many of which differ from each other in significant ways and may not have the same
effect, thus complicating compliance efforts; the federal healthcare programs&rsquo; Anti-Kickback Statute, which prohibits, among
other things, persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly,
in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or
service for which payment may be made under federal healthcare programs such as the Medicare and Medicaid programs; federal false
claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented,
claims for payment from Medicare, Medicaid, or other third-party payors that are false or fraudulent; federal criminal laws that
prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters;
the Physician Payments Sunshine Act, which requires manufacturers of drugs, devices, biologics, and medical supplies to report
annually to the U.S. Department of Health and Human Services information related to payments and other transfers of value to physicians
(defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and ownership and
investment interests held by physicians and their immediate family members; and state law equivalents of each of the above federal
laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payor, including
commercial insurers.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, many states have similar laws and regulations, such as anti-kickback and false claims laws that may be broader in scope
and may apply regardless of payor, in addition to items and services reimbursed under Medicaid and other state programs. Additionally,
to the extent that our product is sold in a foreign country, we may be subject to similar foreign laws.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are also subject to numerous environmental and safety laws and regulations, including those governing the use and disposal of
hazardous materials. The cost of compliance with and any violation of these regulations could have a material adverse effect on
our business and results of operations. Although we believe that our safety procedures for handling and disposing of these materials
comply with the standards prescribed by state and federal regulations, accidental contamination or injury from these materials
may occur. Compliance with laws and regulations relating to the protection of the environment has not had a material effect on
our capital expenditures or our competitive position. However, we are not able to predict the extent of government regulation,
and the cost and effect thereof on our competitive position, which might result from any legislative or administrative action
pertaining to environmental or safety matters.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Competition</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
development and commercialization of new drug products is highly competitive. We expect that we will face significant competition
from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide with respect to
VAL-083 and any other product candidates that we may seek to develop or commercialize in the future. Specifically, due to the
large unmet medical need, global demographics and relatively attractive reimbursement dynamics, the oncology market is fiercely
competitive and there are a number of large pharmaceutical and biotechnology companies that currently market and sell products
or are pursuing the development of product candidates for the treatment of cancer. Our competitors may succeed in developing,
acquiring or licensing technologies and drug products that are more effective, have fewer or more tolerable side effects or are
less costly than any product candidates that we are currently developing or that we may develop, which could render our product
candidates obsolete and noncompetitive.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
of the top ten global pharmaceutical companies and many of the mid-size pharmaceutical companies have a strong research and development
and commercial presence in oncology. Smaller companies also focus on oncology, including companies such as ARIAD Pharmaceuticals,
Inc., Agios Pharmaceuticals, Inc., BIND Therapeutics, Inc., Clovis Oncology, Inc., Endocyte, Inc., Epizyme, Inc., ImmunoGen, Inc.,
Incyte Corporation, Infinity Pharmaceuticals, Inc., MacroGenics, Inc., Merrimack Pharmaceuticals, Inc., OncoMed Pharmaceuticals,
Inc., Onconova Therapeutics, Inc., Pharmacyclics, Inc., Puma Biotechnology, Inc., Seattle Genetics, Inc. and TESARO, Inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Several
companies are marketing and developing oncology immunotherapy products. Companies with approved marketed oncology products for
GBM are Merck (Temodar<SUP>&reg;</SUP>) and Genentech (Avastin<SUP>&reg;</SUP>). Companies with oncology immunotherapy product
candidates in clinical development include, but are not limited to, Northwest Biotherapeutics (DCVax-L), Celldex Therapeutics
(Rindopepimut (CDX-110)) and ImmunoCellular Therapeutics (ICT-107).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more
effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
Our competitors also may obtain FDA or other marketing approval for their products before we are able to obtain approval for ours,
which could result in our competitors establishing a strong market position before we are able to enter the market.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Many
of our existing and potential future competitors have significantly greater financial resources and expertise in research and
development, manufacturing, preclinical testing, conducting clinical studies, obtaining marketing approvals and marketing approved
products than we do. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources
being concentrated among a smaller number of our competitors. Smaller or early stage companies may also prove to be significant
competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete
with us in recruiting and retaining qualified scientific and management personnel and establishing clinical study sites and patient
registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our programs.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
expect that our ability to compete effectively will depend upon our ability to:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">successfully and rapidly complete adequate
                             and well-controlled clinical studies that demonstrate statistically significant safety and efficacy
                             and to obtain all requisite regulatory approvals in a cost-effective manner;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">maintain a proprietary position for
                             our manufacturing processes and other technology;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">produce our products in accordance
                                    with FDA and international regulatory guidelines;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">attract and retain key personnel;
                                    and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">build or access an adequate sales
                                    and marketing infrastructure for any approved products.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Failure
to do one or more of these activities could have an adverse effect on our business, financial condition or results of operations.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Corporate
History</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. (&ldquo;Berry&rdquo;). On January 25, 2013, we
entered into and closed an exchange agreement (the &ldquo;Exchange Agreement&rdquo;), with Del Mar Pharmaceuticals (BC) Ltd. (&ldquo;Del
Mar (BC)&rdquo;), 0959454 B.C. Ltd. (&ldquo;Callco&rdquo;), and 0959456 B.C. Ltd. (&ldquo;Exchangeco&rdquo;) and the security
holders of Del Mar (BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of ours (the
&ldquo;Reverse Acquisition&rdquo;). Prior to the Reverse Acquisition undertaken on January 25, 2013, Berry did not have any significant
assets or operations.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010, that is focused
on the development of drugs for the treatment of cancer. We are also the parent company to Callco and Exchangeco which are British
Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 20, 2016, we effected a one-for-four reverse split of our common stock. All share amounts in this report give effect to the
reverse split unless otherwise indicated.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 8, 2019, we effected a one-for-ten reverse stock split (the &ldquo;Reverse Stock Split&rdquo;) of our issued and outstanding
and authorized common stock. All per share amounts and number of shares of common stock in this prospectus reflect the Reverse
Stock Split. The Reverse Stock Split does not affect the our authorized preferred stock of 5,000,000 shares; except that, pursuant
to the terms of the Certificate of Designations of Series B Convertible Preferred Stock for the issued and outstanding shares
of our Series B Convertible Preferred Stock, par value $0.001 per share (the &ldquo;Series B Preferred Stock&rdquo;), the conversion
price at which shares of Series B Preferred Stock may be converted into shares of common stock will be proportionately adjusted
to reflect the Reverse Stock Split.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Research
and Development</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the nine-month periods ended March 31, 2019 and 2018, we recognized $2,702,213 and $5,856,197, respectively, in research and development
expenses. During the years ended June 30, 2018 and 2017, we recognized $7,132,952 and $5,003,640, respectively, in research and
development expenses.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Employees</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have two full-time employees and retain the services of approximately 15 persons on an independent contractor/consultant and contract-employment
basis. As such, we currently operate in a &ldquo;virtual&rdquo; corporate structure in order to minimize fixed personnel costs.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Legal
Proceedings</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
are no legal proceedings to which we are a party or any of our property is the subject.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Facilities</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
corporate headquarters are located at Suite 720-999 West Broadway, Vancouver, British Columbia, Canada, V5Z 1K5. Our clinical
operations are managed at 3475 Edison Way, Suite R, Menlo Park, California, 94025. Our current monthly base rent for our corporate
headquarters is $4,022 (CDN $5,375) on a month-to-month basis. In addition, Valent Technologies, LLC (&ldquo;Valent&rdquo;), which
is owned by Dr. Dennis Brown, our Chief Scientific Officer, leases facilities in California and we have access to such facilities
pursuant to an informal unwritten arrangement with Valent. Our leased premises, academic relationships, and access to the Valent
facility are sufficient to meet the immediate needs of our business, research and operations.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_008"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>MANAGEMENT</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Executive
Officers and Directors of DelMar</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth information concerning the DelMar directors and executive officers, including their ages as of June
15, 2019. There are no family relationships among any of the DelMar directors or executive officers.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 34%; font: 10pt Times New Roman, Times, Serif; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Name</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 6%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Age</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 58%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Position</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert E. Hoffman</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">53</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chairman of the Board</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Saiid Zarrabian</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">66</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">President, Chief Executive Officer and Director</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dennis Brown, PhD</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">70</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Scientific Officer</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Scott Praill, CPA</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">53</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">John K. Bell, FCPA, CPA</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">72</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lynda&nbsp;Cranston,&nbsp;BScN,&nbsp;MScN,&nbsp;ICD.D</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">72</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Napoleone Ferrara, MD</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">62</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert J. Toth, Jr., MBA</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">56</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following biographical descriptions set forth certain information with respect to the DelMar directors and executive officers,
based on information furnished to the Company by each individual.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Robert
E. Hoffman </B>has served as our director since April 11, 2018 and as our Chairman since June 2, 2018. He has served as a member
of Kura Oncology, Inc.&rsquo;s Board of Directors since March 2015. Mr. Hoffman has served as Senior Vice President and Chief
Financial Officer of Heron Therapeutics, Inc., a publicly-held pharmaceutical company since April 2017. Prior to joining Heron
Therapeutics, Inc., Mr. Hoffman served as Executive Vice President and Chief Financial Officer of Innovus Pharmaceuticals, Inc.,
a publicly-held pharmaceutical company, from September 2016 to April 2017. From July 2015 to September 2016, Mr. Hoffman served
as Chief Financial Officer of AnaptysBio, Inc., a publicly-held biotechnology company. From June 2012 to July 2015, Mr. Hoffman
served as the Senior Vice President, Finance and Chief Financial Officer of Arena Pharmaceuticals, Inc., or Arena, a publicly-held
biopharmaceutical company. From August 2011 to June 2012 and previously from December 2005 to March 2011, he served as Arena&rsquo;s
Vice President, Finance and Chief Financial Officer and in a number of various roles of increasing responsibility from 1997 to
December 2005. From March 2011 to August 2011, Mr. Hoffman served as Chief Financial Officer for Polaris Group, a biopharmaceutical
drug company. Mr. Hoffman formerly served as a member of the Board of Directors of CombiMatrix Corporation, a molecular diagnostics
company, and MabVax Therapeutics Holdings, Inc., a biopharmaceutical company. Mr. Hoffman serves as a member of the Financial
Accounting Standards Board&rsquo;s Small Business Advisory Committee and the steering committee of the Association of Bioscience
Financial Officers. Mr. Hoffman formerly served as a director and President, of the San Diego Chapter of Financial Executives
International. Mr. Hoffman holds a B.B.A. from St. Bonaventure University, and is licensed as a C.P.A. (inactive) in the State
of California. Mr. Hoffman&rsquo;s financial and executive business experience qualifies him to serve on our Board of Directors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Saiid
Zarrabian</B> has served as our director since July 7, 2017, Chief Executive Officer since November 3, 2017, and President since
January 1, 2018. From 2014 to 2015 he operated a private personal business. Since October 2016, Mr. Zarrabian has served as an
advisor to Redline Capital Partners, S.A., a Luxembourg based investment firm. From 2012 to 2014 he served as Chairman and member
of the Board of La Jolla Pharmaceutical Company during which time the company transitioned from an OTC listed company to a NASDAQ
listed company. From 2012 to 2013 he served as President of the Protein Production Division of Intrexon Corporation, a synthetic
biology company. He has also previously served as CEO and member of the Board of Cyntellect, Inc., a stem cell processing and
visualization Instrumentation company until its sale in 2012, as President and COO of Senomyx, Inc., a company focused on discovery
and commercialization of new flavor ingredients, and as COO of Pharmacopeia, Inc., a former publicly-traded provider of combinatorial
chemistry discovery services and compounds, where he also served as President &amp; COO of its MSI Division. In addition, Mr.
Zarrabian has served on numerous private and public company boards, including at Immune Therapeutics, Inc., Exemplar Pharma, LLC,
Ambit Biosciences Corporation, eMolecules, Inc., and Penwest Pharmaceuticals CO. His other experience includes COO at Molecular
Simulations, COO of Symbolics, Inc., and as R&amp;D Director at Computervision, Inc. Mr. Zarrabian&rsquo;s business executive
knowledge and experience qualify him to serve on our Board of Directors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Dennis
Brown, PhD, </B>has been our chief scientific officer since January 25, 2013. He also served as our director from February 11,
2013 to April 11, 2018. Dr. Brown is one of our founders and has served as Chief Scientific Officer and director of Del Mar (BC)
since inception. Dr. Brown has more than thirty years of drug discovery and development experience. He has served as Chairman
of Mountain View Pharmaceutical&rsquo;s Board of Directors since 2000 and is the President of Valent. In 1999 he founded ChemGenex
Therapeutics, which merged with a publicly traded Australian company in 2004 to become ChemGenex Pharmaceuticals (ASX: CXS/NASDAQ:
CXSP), of which he served as President and a Director until 2009. He was previously a co-founder of Matrix Pharmaceutical, Inc.,
where he served as Vice President (VP) of Scientific Affairs from 1985-1995 and as VP, Discovery Research, from 1995-1999. He
also previously served as an Assistant Professor of Radiology at Harvard University Medical School and as a Research Associate
in Radiology at Stanford University Medical School. He received his B.A. in Biology and Chemistry (1971), M.S. in Cell Biology
(1975) and Ph.D. in Radiation and Cancer Biology (1979), all from New York University. Dr. Brown is an inventor of many issued
U.S. patents and applications, many with foreign counterparts.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Scott
Praill, CPA, BSc. </B>has been our chief financial officer since January 29, 2013 and previously served as a consultant to Del
Mar (BC). From 2004 to 2012 Mr. Praill was an independent consultant providing accounting and administrative services to companies
in the resource industry. Mr. Praill served as CFO of Strata Oil&nbsp;&amp;&nbsp;Gas, Inc. from June 2007 to September 2008. From
November 1999 to October 2003 Mr. Praill was Director of Finance at Inflazyme Pharmaceuticals Inc. Mr. Praill completed his articling
at Price Waterhouse (now PricewaterhouseCoopers LLP) and obtained his Chartered Professional Accountant designation in 1996. Mr.
Praill obtained his Certified Public Accountant (Illinois) designation in 2001. Mr. Praill received a Financial Management Diploma
(Honors), from British Columbia Institute of Technology in 1993, and a Bachelor of Science from Simon Fraser University in 1989.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>John
K. Bell, FCPA, FCA, ICD.D </B>has served as our director since February 11, 2013 and serves as the Chair of the Audit Committee.
Mr. Bell is Chairman of Onbelay Capital Inc., a Canadian based private equity company. Prior to that, from 1996 to 2005, Mr. Bell
was CEO and owner of Polymer Technologies Inc., an automotive parts manufacturer. Prior to that, from 1977 to 1995, Mr. Bell was
founder and owner of Shred-Tech Limited a global manufacturer and supplier of industrial shredders and mobile document shredders.
Mr. Bell served as interim CEO and director of ATS Automation Tooling Systems (TSX-ATA) in 2007. Mr. Bell was a director of Strongco
Corporation (TSX-SQP) from 2008 to 2019 and the Royal Canadian Mint (TSX-MNT) from 2009 to 2018. Mr. Bell is a director of Canopy
Growth Corp. (TSX-WEED) and Canopy Rivers Inc. (TSX-RIV) and Mr. Bell also serves as a member of the audit committee of Canopy
Rivers Inc. Mr. Bell is the past National secretary and board member of The Crohns and Colitis Foundation of Canada. Mr. Bell
is also the past Chairman of Waterloo Regional Police, Cambridge Memorial Hospital, Canada&rsquo;s Technology Triangle accelerator
network and The Region of Waterloo prosperity counsel. Mr. Bell is a graduate of Western University Ivey School of Business, a
Fellow of the institute of Chartered Accountants of Ontario, a graduate of the Institute of Directors Program of Canada and the
owner&rsquo;s president program at Harvard and International marketing program at Oxford. Mr. Bell&rsquo;s financial and executive
business experience qualifies him to serve on our Board of Directors.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Lynda
Cranston BScN, MScN, ICD.D </B>has served as our director since February 5, 2015 and serves as the Chair of our Nominating and
Corporate Governance Committee. Mrs. Cranston comes to the Board with over 20 years of experience at the CEO level in healthcare.
She is presently Chair of the British Columbia Rapid Transit Company. She previously was, from 2014 to 2016, the National Chair
of the Gastrointestinal Association of Canada. In 2013 she retired from the healthcare industry and her last appointment prior
to her retirement was as the first CEO of the British Columbia Provincial Health Services Authority (2002 to 2013). From 1998-2001,
Mrs. Cranston had been the first CEO of the Canadian Blood Services in Ottawa, ON. Before moving to Ottawa, Mrs. Cranston, as
the CEO of B.C. Women&rsquo;s Hospital and Healthcare Centre had merged the organization with the BC Children&rsquo;s Hospital
and the Sunny Hill Health Centre for Children to become the Children&rsquo;s and Women&rsquo;s Healthcare Centre of BC. Following
the merger Mrs. Cranston became the first CEO. In 2013, Mrs. Cranston was identified as a member of Diversity 50 by the Canadian
Board Diversity Council as being one of Canada&rsquo;s most board ready candidates. Mrs. Cranston was awarded the Board Chair
Award of Excellence by the HealthCare Leaders; Association of British Columbia in 2008. In 2007, she was inducted into Canada&rsquo;s
Most Powerful Women Top 100 Hall of Fame after having been identified in &lsquo;04, &lsquo;05 &amp; &lsquo;06 as one of Canada&rsquo;s
Most Powerful Women Top 100. Mrs. Cranston is a recipient of the YWCA Women of Distinction Award, the 125<SUP>th</SUP> Anniversary
of the Confederation of Canada Commemorative Medal for community contributions, and the Queen&rsquo;s Golden Jubilee Medal for
contribution to Canada and community. Mrs.&nbsp;Cranston is a graduate of the University of Ottawa and the University of Western
Ontario. Mrs. Cranston&rsquo;s healthcare industry and executive knowledge and experience qualify her to serve on our Board of
Directors.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Napoleone
Ferrara, MD,</B> has served as our director since June 22, 2018. Since January 2013 he has served as a professor of pathology
and since July 2014 as an adjunct professor of ophthalmology and pharmacology at the University of California, San Diego. Previously,
Dr. Ferrara held increasingly senior positions at Genentech, Inc., over a 24-year period, including fellow, staff scientist and
senior scientist. He is a pioneer in the study of angiogenesis biology and identification of its regulators. Dr. Ferrara&rsquo;s
lab is responsible for discovering the isolation and cDNA cloning of VEGF and demonstrated that VEGF was a major mediator of tumor
angiogenesis leading to the development of Avastin<SUP>&reg;</SUP> (bevacizumab). Additionally, his lab&rsquo;s studies led to
the clinical development of an anti-VEGF antibody fragment, Lucentis<SUP>&reg;</SUP> (ranibizumab), as a highly effective therapy
preventing vision loss in intraocular neovascular disorders. Dr. Ferrara has been the recipient of over 60 awards/honors, given
more than 300 presentations, authored over 70 patents, and written more than 300 articles, reviews/editorials and published book
chapters. He received his fellowship training and postdoctoral research from the University of California, San Francisco, his
M.D. (cum laude) and residency training from the University of Catania Medical School, and his Maturita&rsquo; Classica from Liceo
Classico Mario Cutelli. Dr. Ferrara&rsquo;s scientific knowledge and experience qualify him to serve on our Board of Directors.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Robert
J. Toth, Jr., MBA</B> has served as our director since August 20, 2013 and serves as Chair of our Compensation Committee. Since
2005, Mr. Toth has primarily been managing his personal investment portfolio. From 2004-2005, Mr. Toth served as a consulting
analyst to Narragansett Asset Management, a New York-based healthcare-focused hedge fund, where he advised the firm on biotechnology
investments. From 2001-2003, he was the Senior Portfolio Manager for San Francisco-based EGM Capital&rsquo;s Medical Technology
hedge fund, where he was responsible for managing and maintaining a dedicated medical technology portfolio. Mr. Toth began his
Wall Street career in 1996 as an Equity Research Associate for Vector Securities International, a healthcare-focused brokerage
firm. From 1997-1999 he served as Senior Biotechnology Analyst. He joined Prudential Securities as Senior Vice President and Biotechnology
Analyst where he served from 1999-2001 following Prudential&rsquo;s acquisition of Vector. His responsibilities included the analysis
of commercial, clinical and scientific fundamentals of oncology and genomics-based biotechnology companies on behalf of institutional
investors. Mr. Toth was named to the Wall Street Journal&rsquo;s Allstar List for stock picking in 1999. Mr. Toth received an
MBA from the University of Washington and Bachelor of Science degrees in Biological Sciences and Biochemistry from California
Polytechnic State University, San Luis Obispo. Mr. Toth&rsquo;s financial and biotechnology industry knowledge and experience
quality him to serve on our Board of Directors.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>The
Board of Directors and Its Committees</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Board
of Directors Operations and Meetings</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board currently consists of six members. Our directors hold office until their successors have been elected and qualified or until
the earlier of their resignation or removal.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have no formal policy regarding board diversity. Our priority in selection of board members is identification of members who will
further the interests of our stockholders through their established record of professional accomplishment, the ability to contribute
positively to the collaborative culture among board members, knowledge of our business and understanding of the competitive landscape.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board met 27 times in fiscal 2018. Each of the directors attended at least 75% of the aggregate of (i) the total number of meetings
of our Board (held during the period for which such directors served on the Board), and (ii) the total number of meetings of all
committees of our Board on which the director served (during the periods for which the director served on such committee or committees).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Board oversees our business and monitors the performance of our management. In accordance with our corporate governance procedures,
the Board does not involve itself in the day-to-day operations of DelMar. Our executive officers and management oversee our day-to-day
operations. Our directors fulfill their duties and responsibilities by attending meetings of the Board, which are usually held
on at least a quarterly basis. Our directors also discuss business and other matters with other key executives and our principal
external advisers (legal counsel, auditors, financial advisors and other consultants).</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Independent
Directors</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board has determined that Robert Hoffman, John Bell, Lynda Cranston, Napoleone Ferrara and Robert Toth are qualified to serve
as independent directors. Prior to being appointed Chief Executive Officer, Saiid Zarrabian was also determined by our Board to
be independent. The standards relied on by the Board in affirmatively determining whether a director is &ldquo;independent,&rdquo;
in compliance with Nasdaq&rsquo;s rules, are comprised of those objective standards set forth in the rules promulgated by Nasdaq.
The Board is responsible for ensuring that independent directors do not have a relationship that, in the opinion of the Board,
would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nasdaq&rsquo;s
rules, as well as SEC rules, impose additional independence requirements for all members of the Audit Committee. Specifically,
in addition to the &ldquo;independence&rdquo; requirements discussed above, &ldquo;independent&rdquo; audit committee members
must: (1) not accept, directly or indirectly, any consulting, advisory, or other compensatory fees from DelMar or any subsidiary
of DelMar other than in the member&rsquo;s capacity as a member of the Board and any Board committee; (2) not be an affiliated
person of DelMar or any subsidiary of DelMar; and (3) not have participated in the preparation of the financial statements of
DelMar or any current subsidiary of DelMar at any time during the past three years. In addition, Nasdaq&rsquo;s rules require
that all audit committee members be able to read and understand fundamental financial statements, including DelMar&rsquo;s balance
sheet, income statement, and cash flow statement. The Board believes that the current members of the Audit Committee meet these
additional standards.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Furthermore,
at least one member of the Audit Committee must be financially sophisticated, in that he or she has past employment experience
in finance or accounting, requisite professional certification in accounting, or any other comparable experience or background
which results in the individual&rsquo;s financial sophistication, including but not limited to being or having been a chief executive
officer, chief financial officer, other senior officer with financial oversight responsibilities. Additionally, the SEC requires
that DelMar disclose whether the Audit Committee has, and will continue to have, at least one member who is a &ldquo;financial
expert.&rdquo; The Board has determined that John Bell meets the SEC&rsquo;s definition of an audit committee financial expert.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Audit
Committee</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Board has formed an Audit Committee, which currently consists of John K. Bell, Chair, Robert E. Hoffman, and Robert Toth, all
of whom are independent (as that term is defined under the Nasdaq Marketplace Rules) and financially literate (as such qualification
is interpreted by the Board in its business judgment). We are relying upon the exemption in section 6.1 of Canadian National Instrument
52-110 &mdash; Audit Committees from Parts 3 and 5 thereof. In addition, our Board has determined that Mr. Bell qualifies as an
audit committee financial expert within the meaning of SEC regulations and The NASDAQ Marketplace Rules.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Audit Committee oversees and monitors our financial reporting process and internal control system, reviews and evaluates the audit
performed by our registered independent public accountants and reports to our Board any substantive issues found during the audit.
The Audit Committee will be directly responsible for the appointment, compensation and oversight of the work of our registered
independent public accountants. The Audit Committee reviews and approves all transactions with affiliated parties. The Board has
adopted a written charter for the Audit Committee.</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
copy of the Audit Committee Charter is posted under the &ldquo;Investors&rdquo; tab on our website, which is located at <I>www.delmarpharma.com</I>.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Compensation
Committee</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Board has formed a Compensation Committee which consists of Robert Toth, Chair, Napoleone Ferrara, and Robert E. Hoffman, all
of whom are independent (as that term is defined under the Nasdaq Marketplace Rules). The Compensation Committee assists the Board
in fulfilling its oversight responsibilities relating to (i) corporate governance practices and policies and (ii) compensation
matters, including compensation of the directors and senior management of the Company and the administration of compensation plans
of the Company. The Board has adopted a written charter for the Compensation Committee. A copy of the Compensation Committee Charter
is posted under the &ldquo;Investors&rdquo; tab on our website, which is located at <I>www.delmarpharma.com</I>.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Compensation Committee has engaged Marsh &amp; McLennan Agency LLC as its independent compensation consultant. In 2018, Marsh
&amp; McLennan Agency LLC reviewed both executive and director compensation and did not provide us any other services. Marsh &amp;
McLennan Agency LLC reported directly to the Compensation Committee and provided guidance on trends in executive and non-employee
director compensation, the development of specific executive compensation programs, the composition of our compensation peer group
and other matters as directed by the Compensation Committee. In 2017, Marsh &amp; McLennan Agency LLC did not provide any services
to us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
2017, the Compensation Committee engaged Hugessen Consulting to provide certain director compensation services, including with
respect to benchmarking, compensation trends and retention practices and Global Advisors to provide advisory services in connection
with the development of our 2017 Omnibus Equity Incentive Plan. In 2017, Hugessen Consulting and Global Advisors did not provide
us any other services.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Nominating
and Corporate Governance Committee</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Board has formed a Nominating and Corporate Governance Committee, which currently consists of Lynda Cranston, Chair, John Bell,
and Napoleone Ferrara, all of whom are independent (as that term is defined under the Nasdaq Marketplace Rules). The Board has
adopted a written charter for the Nominating and Corporate Governance Committee. A copy of the Nominating and Corporate Governance
Committee Charter is posted under the &ldquo;Investors&rdquo; tab on our website, which is located at <I>www.delmarpharma.com.</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Nomination
of Directors</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Nominating and Corporate Governance Committee of the Board of Directors assesses potential candidates to fill perceived needs
on the Board of Directors for required skills, expertise, independence and other factors. A director candidate recommended by
our stockholders will be considered in the same manner as a nominee recommended by a Board member, management or other sources.
Stockholders wishing to recommend a candidate for nomination should contact our Secretary in writing at the Secretary of DelMar
at Suite 720-999 West Broadway Vancouver, British Columbia, Canada V5Z 1K5. Our Nominating and Corporate Governance Committee
has discretion to decide which individuals to recommend for nomination as directors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Board
Leadership Structure and Role in Risk Oversight</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert
E. Hoffman serves as the chairman of our Board of Directors. Saiid Zarrabian serves as our Chief Executive Officer and President.
We have not adopted a formal policy on whether the Chief Executive Officer and Chairman positions should be separated.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board of Directors is primarily responsible for overseeing our risk management processes. The Board of Directors receives and
reviews periodic reports from management, auditors, legal counsel, and others, as considered appropriate regarding our assessment
of risks. The Board of Directors focuses on the most significant risks facing us and our general risk management strategy, and
also ensures that risks undertaken by us are consistent with the board&rsquo;s appetite for risk. While the Board of Directors
oversees our risk management, management is responsible for the day-to-day risk management processes. We believe this division
of responsibilities is the most effective approach for addressing the risks we face and that our board leadership structure supports
this approach.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Code
of Ethics</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have adopted a Code of Ethics and Business Conduct that applies to all of our executive officers, financial and accounting officers,
our directors, our financial managers and all of our employees. The Board of Directors is committed to a high standard of corporate
governance practices and, through its oversight role, encourages and promotes a culture of ethical business conduct. A copy of
our Code of Ethics and Business Conduct is posted under the &ldquo;Investors&rdquo; tab under Corporate Governance on our website,
which is located at <I>www.delmarpharma.com</I>.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholder
Communication with the Board of Directors and Attendance at Annual Meetings</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Board maintains a process for stockholders to communicate with the Board and its committees. Stockholders of DelMar and other
interested persons may communicate with the Board or the chair of the Audit Committee, Compensation Committee, and the Nominating
and Corporate Governance Committee by writing to the Secretary of DelMar at Suite 720-999 West Broadway Vancouver, British Columbia,
Canada V5Z 1K5. All communications that relate to matters that are within the scope of the responsibilities of the Board will
be presented to the Board no later than the next regularly scheduled meeting. Communications that relate to matters that are within
the responsibility of one of the Board committees will be forwarded to the chair of the appropriate committee. Communications
that relate to ordinary business matters that are not within the scope of the Board&rsquo;s responsibilities will be forwarded
to the appropriate officer. Solicitations, junk mail and obviously frivolous or inappropriate communications will not be forwarded,
but will be made available to any director who wishes to review them.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_009"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>EXECUTIVE
COMPENSATION</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Board of Directors has formed a Compensation Committee. The Compensation Committee is responsible for reviewing and approving
management compensation, including salaries, bonuses, and equity compensation. We seek to provide competitive compensation arrangements
that attract and retain key talent necessary to achieve our business objectives.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Summary
Compensation Table</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table presents information regarding the total compensation awarded to, earned by, or paid to our Chief Executive Officer
and the two most highly-compensated executive officers (other than the Chief Executive Officer) who were serving as executive
officers as of June 30, 2018 and June 30, 2017 for services rendered in all capacities to us for the years ended June 30, 2018
and June 30, 2017, reflecting our one-for-ten reverse stock split occurring on May 8, 2019. These individuals are our Named Executive
Officers for 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">SUMMARY
COMPENSATION TABLE</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Name and Principal Position</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Period</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Salary <BR> (US$)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold"><SUP>&nbsp;</SUP></TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Bonus <BR> Awards <BR> (US$)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Equity <BR> Awards <BR> (US$)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Total <BR> (US$)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%; text-align: left; text-indent: -10pt; padding-left: 10pt">Saiid Zarrabian, <BR> President and CEO</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 16%; text-align: center">Year Ended <BR> June 30, 2018</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">237,412</TD><TD STYLE="width: 1%; text-align: left"><SUP>(1)</SUP></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">85,631</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">615,992</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">939,035</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Jeffrey Bacha, <BR> Former President and CEO</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">537,579</TD><TD STYLE="text-align: left"><SUP>(2)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">122,338</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">659,917</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">305,000</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">56,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">249,257</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">610,507</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Dennis Brown, PhD, <BR> Chief Scientific Officer</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,000</TD><TD STYLE="text-align: left"><SUP>(3)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">175,000</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">249,257</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">464,257</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Scott Praill, <BR> Chief Financial Officer</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,000</TD><TD STYLE="text-align: left"><SUP>(4)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">210,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Year Ended <BR> June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">240,000</TD><TD STYLE="text-align: left"><SUP>&nbsp;</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">99,596</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">379,596</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left">(1<FONT STYLE="font-family: Times New Roman, Times, Serif">)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">On July 7, 2017 Mr. Zarrabian was elected to
                      the Board of Directors. Upon his appointment Mr. Zarrabian was granted 3,600 stock options that are exercisable
                      at $21.10 until July 7, 2027 for total compensation expense of $40,752. He was also issued 20,000 PSUs for
                      total compensation expense of $98,428. The PSUs were cancelled effective April 30, 2019. For serving as
                      an independent director from July 7, 2017 until November 3, 2017 he was paid $8,750.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(2)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">On February 9, 2017, we entered into an employment
                      agreement with Jeffrey Bacha, our former president and chief executive officer. We paid Mr. Bacha an annual
                      base salary of $250,000 and Mr. Bacha will also be eligible to participate in any bonus plan and long-term
                      incentive plan established by us for senior executives. On December 22, 2017, we entered into a settlement
                      agreement with Mr. Bacha pursuant to which, effective January 1, 2018, he would no longer serve as our officer.
                      In addition, Mr. Bacha did not stand for re-election to the Board of Directors at our 2018 annual meeting
                      of stockholders held on April 11, 2018. Pursuant to the terms of the settlement agreement and consistent
                      with the terms of the employment agreement between Mr. Bacha and us dated February 9, 2017, as amended,
                      Mr. Bacha was entitled to (i) accrued and unpaid base salary through January 1, 2018, (ii) payment for his
                      accrued and unused vacation through January 1, 2018, (iii) severance in an amount equal to 13 months of
                      Mr. Bacha&rsquo;s base salary, or $270,833, (iv) payment in an amount equal to 12 months&rsquo; of coverage
                      under our benefits plans, or $9,600 and (v) reimbursement for any properly incurred business expenses submitted
                      with appropriate documentation in accordance with our expense reimbursement policies through December 31,
                      2017. In addition, all of Mr. Bacha&rsquo;s unvested stock options were deemed vested as of January 1, 2018
                      and will remain exercisable for three years and any unexercised options will expire on December 31, 2020.
                      In addition, effective January 1, 2018, Mr. Bacha will provide consulting services to us through April 30,
                      2018 for a consulting fee of $20,833 per month and subsequent to April 30, 2018 on an hourly basis. The
                      separation agreement and the employment agreement contain customary post-termination restrictive covenants
                      in favor of us including confidentiality, non-competition and non-solicitation covenants. As a result of
                      modifying Mr. Bacha&rsquo;s stock options, a total of $122,338 has been recognized.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(3)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">On January 1, 2015 we entered into a consulting
                      agreement with Dr. Dennis Brown, our chief scientific officer. Subsequent to this agreement, it has been
                      amended and is now renewed on an annual basis. Under the most recent renewal, Dr. Brown will continue to
                      serve as our chief scientific officer until December 31, 2018, which period may be extended in accordance
                      with the terms of the agreement. We will pay Dr. Brown an annual consulting fee of $200,000 during calendar
                      year 2018. We may also pay to Dr. Brown a bonus and incentive compensation as determined at the discretion
                      of the Board of Directors. The consulting agreement with Dr. Brown does not specify the amount of time Dr.
                      Brown is required to devote to us, but does require that Dr. Brown provide us with the full benefit of his
                      knowledge, expertise and ingenuity, and prohibits Dr. Brown from engaging in any business, enterprise or
                      activity contrary to or that would detract from our business.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(4)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">On February 9, 2017, we entered into an employment
                      agreement with Scott Praill, our chief financial officer. Pursuant to the employment agreement, Mr. Praill
                      will continue to serve as our chief financial officer for an indefinite period until termination of the
                      employment agreement in accordance with its terms. We will pay Mr. Praill an annual base salary of $200,000
                      (which may be adjusted on an annual basis in the discretion of the Board of Directors) and Mr. Praill will
                      also be eligible to participate in any bonus plan and long-term incentive plan established by us for senior
                      executives. The employment agreement may be terminated by us with or without cause (as defined therein).
                      In the event we terminate the employment agreement without cause, we will be required to pay Mr. Praill,
                      any accrued and unpaid base salary, plus an amount equal to 12 months of Mr. Praill&rsquo;s base salary
                      plus one additional month&rsquo;s base salary for each completed year of service, up to 18 months&rsquo;
                      base salary.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
November 3, 2017 Mr. Zarrabian was appointed interim chief executive officer and on January 1, 2018 he was also appointed interim
president. On November 3, 2017 we entered an agreement with Mr. Zarrabian pursuant to which he will receive an annualized fee
of $280,000 and be eligible to receive a bonus targeted up to 30% of the $280,000 annual fee which may be adjusted by the Board
based on his individual performance and our performance as a whole, with such performance targets to be established by the Board.
Upon execution of the agreement, we paid Mr. Zarrabian an advance of $45,000 of the annual fee. With the $45,000 advance, Mr.
Zarrabian purchased shares of our common stock on the market. For the period from November 3, 2017 to May 20, 2018 we paid Mr.
Zarrabian a total of $243,510 under the consulting agreement which includes the $45,000 advance, $130,134 in consulting fees,
and $68,376 in bonus. Upon his appointment as interim chief executive officer he was granted 12,000 stock options that are exercisable
at $8.70 until November 3, 2027 for total compensation expense of $53,567.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 21, 2018, we entered into an employment agreement with Mr. Zarrabian pursuant to which Mr. Zarrabian was appointed as our
permanent president and chief executive officer. Under the Agreement, Mr. Zarrabian will receive an annual base salary of $470,000
and will be eligible to receive a fiscal year target bonus of up to 50% of base salary (which may be adjusted by the Board to
up to 60% of base salary based on overachievement of bonus targets or other performance criteria). Any bonus earned for a fiscal
year will be payable in cash, but the Board may pay up to 50% of the bonus, as well as any bonus in excess of 50% of base salary,
in the form of stock options granted under our 2017 Omnibus Equity Incentive Plan (or any successor plan). The bonus for our fiscal
year ending June 30, 2019 will be based on the period from the effective date of the agreement (May 21, 2018) through June 30,
2019. The employment agreement may be terminated by us with or without cause (as defined therein). In the event we terminate the
employment agreement without cause, we will be required to pay Mr. Zarrabian continued payment of his base salary for 12 months,
a prorated bonus for the year of termination based on performance through the date of termination, an additional six months of
vesting credit for any outstanding options, and continued health coverage during the severance period. In the event that an involuntary
termination occurs during a period beginning sixty days before a definitive corporate transaction agreement is entered into that
would result in a change in control, or within twelve months following a change in control, the severance period will increase
to eighteen months&rsquo; severance, Mr. Zarrabian will receive 100% of his target bonus, and his options will be fully vested.
During the period from May 21, 2018 to June 30, 2018 Mr. Zarrabian was paid $53,528 under the employment agreement. We have also
recorded a pro-rated bonus of $17,255. Upon his appointment as full-time president and chief executive officer Mr. Zarrabian was
granted 83,647 stock options that are exercisable at $9.80 until May 21, 2028 for total compensation expense of $423,245.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Outstanding
Equity Awards at Fiscal Year-End</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth outstanding equity awards to our named executive officers as of June 30, 2018, reflecting our one-for-ten
reverse stock split occurring on May 8, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="17" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Option awards</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Stock awards</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Name</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> securities <BR> underlying <BR> unexercised <BR> options (#) <BR> Exercisable</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> securities <BR> underlying <BR> unexercised <BR> options (#) <BR> unexercisable</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Equity <BR> incentive &nbsp;&nbsp;plan <BR> awards: <BR> number of <BR> securities <BR> underlying <BR> unexercised <BR> unearned <BR> options <BR> (#)</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Option <BR> exercise <BR> price <BR> (US$)</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Option <BR> expiration <BR> date</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Equity <BR> incentive&nbsp;plan <BR> awards: <BR> Number of <BR> unearned <BR> shares, units&nbsp;or <BR> other rights <BR> that have not <BR> vested <BR> (#)</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Equity <BR> incentive&nbsp;plan <BR> awards: Market <BR> or payout&nbsp;value <BR> of unearned <BR> shares, units&nbsp;or <BR> other rights <BR> that have not <BR> vested <BR> ($)</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; text-align: left; text-indent: -10pt; padding-left: 10pt">Saiid Zarrabian</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">1,200</TD><TD STYLE="width: 1%; text-align: left"><SUP>(1)</SUP></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">2,400</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">21.10</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 14%; text-align: center">July 7, 2027</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">20,000</TD><TD STYLE="width: 1%; text-align: left"><SUP>(5)</SUP></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,000</TD><TD STYLE="text-align: left"><SUP>(2)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Nov 3, 2027</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left"><SUP>(3)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">83,647</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.80</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">May 21, 2028</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Jeffrey Bacha</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,750</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20.00</TD><TD STYLE="text-align: left"><SUP>(6)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Dec 31, 2020</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,750</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">42.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Dec 31, 2020</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,360</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Dec 31, 2020</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Dennis Brown, PhD</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,750</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20.00</TD><TD STYLE="text-align: left"><SUP>(6)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Feb 1, 2022</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,750</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">42.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Aug 15, 2023</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,160</TD><TD STYLE="text-align: left"><SUP>(4)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,200</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Feb 17, 2027</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Scott Praill</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20.00</TD><TD STYLE="text-align: left"><SUP>(6)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Feb 1, 2022</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,750</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">42.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Aug 15, 2023</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,662</TD><TD STYLE="text-align: left"><SUP>(4)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,078</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Feb 17, 2027</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-align: left; text-indent: -24pt"></P>

<!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 0; margin-bottom: 0"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid; width: 25%">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-align: left; text-indent: -24pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(1)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Stock options vest as to 1,200 on June 30,
                         2018, and 300 options vest each three months thereafter starting September&nbsp;30, 2018.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(2)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Stock options vest pro rata monthly
                               until full vesting on November 3, 2018.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(3)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Stock options vest as to 1/6<SUP>th</SUP> on
                      November 21, 2018 with the remaining shares vesting in equal monthly installments over a period of 30 months
                      commencing on December 21, 2018.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(4)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Stock options vest pro rata monthly until fully
                      vesting on February 17, 2020.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(5)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Each Performance Stock Unit (&ldquo;PSU&rdquo;)
                      represents the right to receive one share of common stock upon vesting of the unit based on our fully diluted
                      market capitalization. See additional information in Securities Authorized for Issuance Under Equity Compensation
                      Plans located elsewhere in this prospectus.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(6)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Original exercise price was CDN $20.00. Price
                      was amended to USD $20.00 on June 30, 2016. All other terms of the option grants remain unchanged.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Director
Compensation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director
compensation is intended to provide an appropriate level of remuneration considering the responsibilities, time requirements and
accountability of the Directors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth director compensation for the fiscal year ended June 30, 2018 (excluding compensation to our executive
officers set forth in the summary compensation table above) paid by us, reflecting our one-for-ten reverse stock split occurring
on May 8, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Name</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Fees <BR> Earned or <BR> Paid in <BR> Cash <BR> ($)<SUP>(1)</SUP></B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stock <BR> Awards <BR> ($)<SUP>(3)</SUP></B></FONT></TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Option <BR> Awards <BR> ($)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Non-Equity <BR> Incentive Plan <BR> Compensation <BR> ($)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nonqualified <BR> Deferred <BR> Compensation <BR> Earnings <BR> ($)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">All Other <BR> Compensation <BR> ($)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Total <BR> ($)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 30%; text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert E. Hoffman<SUP>(4)</SUP></FONT></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">10,833</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">120,106</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">20,142</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 7%; text-align: right">151,081</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">John K. Bell<SUP>(2)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">98,428</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,752</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">179,180</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lynda Cranston<SUP>(2)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">98,428</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,752</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">179,180</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Napoleone Ferrara, MD<SUP>(5)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">863</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">60,947</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19,643</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">81,453</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Erich Mohr, MD<SUP>(6)(2)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">55,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">98,428</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,752</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">84,833</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert J, Toth, Jr.<SUP>(2)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">37,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">98,428</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,752</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">179,180</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 0; margin-bottom: 0"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid; width: 25%">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(1)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;Effective July 1, 2017, directors are paid a
              $35,000 annual retainer, an additional $5,000 annual retainer for chairing a committee, and the chairman of the
              Board will be paid an additional annual retainer of $25,000.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(2)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">On July 7, 2017, independent directors were
                      granted 3,600 stock options at an exercise price of $21.10. The options have a ten-year term and vest as
                      to one-third on June 30, 2018 and 300 on a quarterly basis commencing September 30, 2018.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(3)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">A total of 140,000 PSUs were issued
                             under the 2017 Plan to our independent directors, such units were cancelled effective as of April
                             30, 2019. Dr. Mohr forfeited 20,000 upon his resignation leaving a net outstanding as of June 30,
                             2018 of 120,000. The awards represent the right to receive an aggregate of 120,000 shares of our
                             common stock upon vesting of the PSUs. Vesting is based on targets approved by our Board of Directors
                             related to our fully diluted market capitalization. The PSUs vest at various fully diluted market
                             capitalizations but will vest in full upon us achieving a fully diluted market capitalization of
                             at least $500 million for five consecutive business days. The PSUs expire on July 7, 2022.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(4)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Mr. Hoffman was appointed to the
                                Board of Directors on April 11, 2018 and was appointed Chairman on June 2, 2018. He has been granted
                                3,600 stock options at an exercise price of $10.60. The options have a ten-year term and vest
                                as to one-third on March 31, 2019 and 300 on a quarterly basis commencing June 30, 2019.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(5)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Dr. Ferrara was appointed to the Board
                             of Directors on June 22, 2018. He has been granted 5,451 stock options at an exercise price of $7.00.
                             The options have a ten-year term and vest as to one-third on May 31, 2019 and 454 on a quarterly
                             basis commencing August 31, 2019.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(6)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Dr. Mohr resigned as Chairman of the
                             Board and as a director on June 2, 2018. Upon his resignation, a total of 1,500 options had their
                             vesting accelerated such that they became fully vested on June 2, 2018 and a total of 4,500 options
                             were modified such that their remaining exercise period was increased from 90 days to one year.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT>&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Risk
Management</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
do not believe risks arising from its compensation policies and practices for its employees are reasonably likely to have a material
adverse effect on us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_010"></A>CERTAIN
RELATIONSHIPS AND RELATED PERSON TRANSACTIONS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
describe below transactions and series of similar transactions that we were or will be a party to in which (i) an executive officer,
director, nominee for election as a director, beneficial owner of more than 5% of any class of our common stock or any member
of the immediate family of any of the foregoing persons and (ii) the amount involved exceeds $120,000 or one percent of the average
of our total assets at year-end for the last two completed fiscal years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Other
than as described below, there has not been, nor is there any currently proposed, transactions or series of similar transactions
to which we have been or will be a party.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
September 12, 2010, Del Mar (BC) entered into a Patent Assignment Agreement (the &ldquo;Assignment&rdquo;) with Valent Technologies
LLC pursuant to which Valent assigned to Del Mar (BC) its rights to patent applications and the prototype drug product related
to VAL-083. In accordance with the Assignment the consideration paid by Del Mar (BC) was $250,000 to acquire the prototype drug
product. In accordance with the terms of the Assignment, Valent is entitled to receive a future royalty (in the single digits)
on certain revenues derived from the development and commercialization of VAL-083. In the event that Del Mar (BC) terminates the
agreement, Del Mar (BC) may be entitled to receive royalties from Valent&rsquo;s subsequent development of VAL-083 depending on
the development milestones Del Mar (BC) has achieved prior to the termination of the Assignment. The Assignment has a term (on
a country-by-country basis), of the later of ten years or until patent rights covered by the Assignment no longer exist, subject
to earlier termination in the event Del Mar (BC) breaches its payment obligations and fails to remedy such breach within 60 days,
or if either party materially beaches any of its obligations and does not cure such breach within 30 days after receipt of notice
thereof.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pursuant
to a loan agreement dated February 3, 2011, between Del Mar (BC) and Valent, Valent loaned Del Mar $250,000 for the purchase of
the prototype drug product under the Assignment. The loan is unsecured, bears interest at 3% per year, and is payable on demand.
Effective September 30, 2014, we entered into and closed an agreement with Valent to exchange its loan, including accrued interest
to September 30, 2014, with Valent for 278,530 shares of our Series A preferred stock. The Series A preferred stock has an annual
3% dividend.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">One
of our officers, Dr. Dennis Brown, is a principal of Valent and as result Valent is a related party to us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_011"></A>PRINCIPAL
STOCKHOLDERS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth certain information, as of June 15, 2019, with respect to the beneficial ownership of the outstanding
common stock, reflecting our one-for-ten reverse stock split occurring on May 8, 2019, by (i) any holder of more than five (5%)
percent; (ii) each of our executive officers and directors; and (iii) our directors and executive officers as a group. Except
as otherwise indicated, each of the stockholders listed below has sole voting and investment power over the shares beneficially
owned.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Name of Beneficial Owner<SUP>(1)</SUP></B></FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Common Stock <BR> Beneficially <BR> Owned</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Percentage of <BR> Common <BR> Stock<SUP>(2)</SUP></B></FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold">Directors and Officers:</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Saiid Zarrabian</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">50,019</TD><TD STYLE="width: 1%; text-align: left"><SUP>(3)</SUP></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1.29</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Dennis Brown, PhD</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">90,091</TD><TD STYLE="text-align: left"><SUP>(4)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2.34</TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Scott Praill</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,064</TD><TD STYLE="text-align: left"><SUP>(5)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Robert E. Hoffman</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left"><SUP>(6)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">John K. Bell</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20,571</TD><TD STYLE="text-align: left"><SUP>(7)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Robert J. Toth, Jr.</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,899</TD><TD STYLE="text-align: left"><SUP>(8)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Lynda Cranston</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,004</TD><TD STYLE="text-align: left"><SUP>(9)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Napoleone Ferrara, MD</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,817</TD><TD STYLE="text-align: left"><SUP>(10)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Jeffrey Bacha</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">104,063</TD><TD STYLE="text-align: left"><SUP>(11)</SUP></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2.7</TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">All officers and directors as a group (9 persons)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">318,028</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.3</TD><TD STYLE="text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">*
                          </FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Less than 1%</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(1)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Except
                                         as otherwise indicated, the address of each beneficial owner is c/o DelMar Pharmaceuticals,
                                         Inc., Suite 720 &ndash; 999 West Broadway, Vancouver, British Columbia, Canada V5Z 1K5.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(2)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Applicable
                                         percentage ownership is based on 3,827,259 shares of common stock outstanding as of June
                                         15, 2019, together with securities exercisable or convertible into shares of common stock
                                         within 60 days of June 15, 2019 for each stockholder. Beneficial ownership is determined
                                         in accordance with the rules of the SEC and generally includes voting or investment power
                                         with respect to securities. Shares of common stock that are currently exercisable or
                                         exercisable within 60 days of June 15, 2019 are deemed to be beneficially owned by the
                                         person holding such securities for the purpose of computing the percentage of ownership
                                         of such person, but are not treated as outstanding for the purpose of computing the percentage
                                         ownership of any other person.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(3)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes
                                         43,929 shares issuable upon the exercise of vested stock options.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(4)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes
                                         53,750 shares held by Valent Technologies, LLC, 20,040 shares issuable upon exercise
                                         of vested stock options, 2,125 shares issuable upon exercise of warrants held by Dr.
                                         Brown, and 750 shares issuable upon the conversion of Series B Preferred Stock.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(5)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes
                                         15,513 shares issuable upon exercise of vested stock options, 1,250 shares issuable upon
                                         exercise of warrants and 938 shares upon the conversion of Series B Preferred Stock.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(6)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes
                                         4,500 shares issuable upon exercise of vested stock options.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(7)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes
                                         9,671 shares owned by Onbelay Capital, Inc., 1,250 shares issuable upon exercise of warrants
                                         held by Onbelay Capital, Inc., 8,400 shares issuable upon exercise of vested stock options,
                                         and 1,250 shares issuable upon the conversion of Series B Preferred Stock held by Onbelay
                                         Capital, Inc.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(8)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes
                                         8,400 shares issuable upon exercise of vested stock options and 325 shares issuable upon
                                         the conversion of Series B Preferred Stock.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(9)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes 8,400 shares issuable upon exercise
                      of vested options and 313 shares issuable upon the conversion of Series B Preferred Stock.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(10)</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes 4,817 shares issuable upon exercise
                      of vested stock options.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">(11)&nbsp;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Includes 625 shares issuable upon exchange
                      of Exchangeable Shares held in trust, 21,860 shares issuable upon exercise of vested stock options, 1,500
                      shares issuable upon exercise of warrants, and 781 shares issuable upon the conversion of Series B Preferred
                      Stock.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_012"></A>MARKET
PRICE OF OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
common stock is listed on The Nasdaq Capital Market, under the symbol &ldquo;DMPI&rdquo;. On June 21, 2019, the closing price
for our common stock as reported on The Nasdaq Capital Market was $1.54 per share. As of May 2, 2019, we had 322 record holders
of our common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_013"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DIVIDEND
POLICY</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have never declared or paid any dividends on our common stock and do not anticipate paying any in the foreseeable future. Any
future determination relating to our dividend policy will be made at the discretion of our board of directors and will depend
on a number of factors, including future earnings, capital requirements, financial conditions, future prospects, contractual restrictions
and covenants and other factors that our board of directors may deem relevant.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_014"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>SELLING
STOCKHOLDERS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">This
prospectus covers an aggregate of up to 760,500 shares of our common stock that may be sold or otherwise disposed of by the selling
stockholders identified herein. Such shares are issuable to the selling stockholders upon the exercise of certain outstanding
common stock purchase warrants (the &ldquo;Investment Warrants&rdquo;) we issued and sold to the selling stockholders in a private
placement transaction, as described above under &ldquo;Prospectus Summary &ndash; Registered Direct Offering and Private Placement.&rdquo;
Under the terms of the Investment Warrant, no selling stockholder may exercise an Investment Warrant to the extent the selling
stockholder or any of its affiliates would beneficially own a number of shares of our common stock which would exceed 4.99%.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
table below sets forth information concerning the resale of our shares by the selling stockholders. The total number of common
shares sold under this prospectus may be adjusted to reflect adjustments due to stock dividends, stock distributions, splits,
combinations or recapitalizations with regard to the common stock. Unless otherwise stated below in the footnotes, to our knowledge,
no selling stockholder, nor any affiliate of such stockholder: (i) has held any position or office with us during the three years
prior to the date of this prospectus; or (ii) is a broker-dealer, or an affiliate of a broker-dealer.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Set
forth below is the name of each selling stockholder and the amount and percentage of common stock owned by each (including shares
which a stockholder has the right to acquire within 60 days, including upon exercise of options or warrants) prior to the offering,
the shares to be sold in the offering, and the amount and percentage of common stock to be owned by each (including shares which
a stockholder has the right to acquire within 60 days, including upon exercise of options or warrants) after the offering assuming
all shares are sold. The footnotes provide information about persons who have voting and dispositive power with respect to shares
held by the selling stockholders.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table is based on information provided to us by the selling stockholders and is as of June 15, 2019. The selling stockholders
may sell all or some of the shares of common stock they are offering, and may sell, unless indicated otherwise in the footnotes
below, shares of our common stock otherwise than pursuant to this prospectus. The tables below assume that each selling stockholder
sells all of the shares offered by it in offerings pursuant to this prospectus, and does not acquire any additional shares. We
are unable to determine the exact number of shares that will actually be sold or when or if these sales will occur.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Shares of Common<BR>
 Stock<BR>
 Beneficially Owned Prior<BR>
 to Offering</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Number
of<BR> Shares of<BR> Common<BR> Stock&nbsp;Being </B></FONT></TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Shares of Common<BR>
 Stock&nbsp;to<BR>
 be Beneficially Owned&nbsp;After<BR>
 Offering</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Name of Selling Securityholder</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Percentage</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; padding-bottom: 1.5pt; border-bottom: Black 1.5pt solid"><B>Offered<SUP>(1)</SUP></B></TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Percentage</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-size: 10pt">Anson Investments Master Fund LP<SUP>(2)</SUP></FONT></TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">201,322</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">4.99</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">190,125</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">202,822</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">4.99</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Empery Asset Master, Ltd<SUP>(3)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">120,749</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.07</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">111,487</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,262</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Empery Tax Efficient, LP<SUP>(4)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,575</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,458</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,117</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Empery Tax Efficient II, LP<SUP>(5)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">70,595</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.81</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">65,180</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,415</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Hudson Bay Master Fund Ltd.<SUP>(6)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">190,125</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.73</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">190,125</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left"><FONT STYLE="font-size: 10pt">Intracoastal Capital, LLC<SUP>(7)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">200,744</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.99</TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">190,125</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">49,100</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.25</TD><TD STYLE="text-align: left">%</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 0pt; margin-bottom: 0pt"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid; width: 25%"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">*</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif">Less
                                         than 1%</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>
<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(1)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Applicable
                                         percentage ownership is based on 3,827,259 shares of common stock outstanding as of June
                                         15, 2019, together with securities exercisable or convertible into shares of common stock
                                         within 60 days of June 15, 2019 for each stockholder. Beneficial ownership is determined
                                         in accordance with the rules of the SEC and generally includes voting or investment power
                                         with respect to securities. Shares of common stock that are currently exercisable or
                                         exercisable within 60 days of June 15, 2019 are deemed to be beneficially owned by the
                                         person holding such securities for the purpose of computing the percentage of ownership
                                         of such person, but are not treated as outstanding for the purpose of computing the percentage
                                         ownership of any other person.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;</FONT></P>

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<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(2)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consists
                                         of (i) 162,822 shares of common stock, (ii) 2,500 shares of common stock receivable upon
                                         conversion of convertible preferred shares and (iii) 36,000 shares of common stock underlying
                                         warrants issued in our 2018 registered direct offering (the &ldquo;2018 Warrants&rdquo;)
                                         in column 2 and 37,500 shares of common stock underlying the 2018 Warrants in column
                                         4. The foregoing excludes (i) 64,000 shares of common stock underlying the 2018 Warrants
                                         in column 2 and 62,500 shares of common stock underlying the 2018 Warrants in column
                                         4, (ii) 190,125 shares of common stock underlying Investment Warrants and (iii) 522,500
                                         shares of common stock underlying warrants receivable upon exercise of rights to obtain
                                         additional common warrants (the &ldquo;Warrant Rights&rdquo; and, collectively with the
                                         Investment Warrants and the 2018 Warrants, the &ldquo;Anson Warrants&rdquo;) because
                                         the Anson Warrants are subject to a 4.99% beneficial ownership blocker. Voting and investment
                                         power over the shares held by Anson Investments Master Fund LP (&ldquo;Anson&rdquo;)
                                         is exercised by the co-investment advisors to Anson. The co-investment advisors of Anson
                                         consist of Anson Advisors Inc. and Anson Funds Management LP. Mr. Moez Kassam and Mr.
                                         Amin Nathoo are directors of Anson Advisors Inc. Mr. Bruce R. Winson is the managing
                                         member of Anson Management GP LLC, which is the general partner of Anson Funds Management
                                         LP.&nbsp; &nbsp;Each of Mr. Kassam, Mr. Nathoo, and Mr. Winson disclaim beneficial ownership
                                         of the shares of our common stock held by Anson, except to the extent of their pecuniary
                                         interests therein.&nbsp;&nbsp; The principal business address of each of Mr. Kassam.
                                         Mr. Nathoo and Anson Advisors Inc. is 155 University Ave, Suite 207, Toronto, Ontario
                                         M5H 3B7, and the principal business address of each of Mr. Winson, Anson Management GP
                                         LLC, and Anson Funds Management LP is 5950 Berkshire Lane, Suite 210, Dallas, Texas 75225.
                                         The principal business address for Anson is 190 Elgin Avenue; George Town, Grand Cayman.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(3)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consists
                                         of 9,262 shares of common stock and 111,487 shares of common stock underlying Investment
                                         Warrants. The exercise of the Investment Warrants held by Empery Asset Master Ltd (&ldquo;EAM&rdquo;)
                                         are subject to a 4.99% beneficial ownership blocker. Empery Asset Management LP, the
                                         authorized agent of EAM, has discretionary authority to vote and dispose of the shares
                                         held by EAM and may be deemed to be the beneficial owner of these shares. Martin Hoe
                                         and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP,
                                         may also be deemed to have investment discretion and voting power over the shares held
                                         by EAM. EAM, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of these shares.
                                         The principal business address for EAM is c/o Empery Asset Management, LP, 1 Rockefeller
                                         Plaza, Suite 1205, New York, NY 10020.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(4)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consists
                                         of 1,117 shares of common stock and 13,458 shares of common stock underlying Investment
                                         Warrants. The exercise of the Investment Warrants held by Empery Tax Efficient, LP (&ldquo;ETE&rdquo;)
                                         are subject to a 4.99% beneficial ownership blocker. Empery Asset Management LP, the
                                         authorized agent of ETE, has discretionary authority to vote and dispose of the shares
                                         held by ETE and may be deemed to be the beneficial owner of these shares. Martin Hoe
                                         and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP,
                                         may also be deemed to have investment discretion and voting power over the shares held
                                         by ETE. ETE, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of these shares.
                                         The principal business address for ETE is c/o Empery Asset Management, LP, 1 Rockefeller
                                         Plaza, Suite 1205, New York, NY 10020.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(5)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consists
                                         of 5,415 shares of common stock and 65,180 shares of common stock underlying Investment
                                         Warrants. The exercise of the Investment Warrants held by Empery Tax Efficient II, LP
                                         (&ldquo;ETE II&rdquo;) are subject to a 4.99% beneficial ownership blocker. Empery Asset
                                         Management LP, the authorized agent of ETE II, has discretionary authority to vote and
                                         dispose of the shares held by ETE II and may be deemed to be the beneficial owner of
                                         these shares. Martin Hoe and Ryan Lane, in their capacity as investment managers of Empery
                                         Asset Management LP, may also be deemed to have investment discretion and voting power
                                         over the shares held by ETE II. ETE II, Mr. Hoe and Mr. Lane each disclaim any beneficial
                                         ownership of these shares. The principal business address for ETE II is c/o Empery Asset
                                         Management, LP, 1 Rockefeller Plaza, Suite 1205, New York, NY 10020.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(6)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consists
                                         of 190,125 shares of common stock underlying Investment Warrants. The exercise of the
                                         Investment Warrants held by Hudson Bay Master Fund Ltd. (&ldquo;Hudson Bay&rdquo;) are
                                         subject to a 4.99% beneficial ownership blocker. Hudson Bay Capital Management LP, the
                                         investment manager of Hudson Bay, has voting and investment power over these securities.
                                         Sander Gerber is the managing member of Hudson Bay Capital GP LLC, which is the general
                                         partner of Hudson Bay Capital Management LP. Each of Hudson Bay Master Fund Ltd. and
                                         Sander Gerber disclaims beneficial ownership over these shares. The principal business
                                         address of Hudson Bay is c/o Hudson Bay Capital Management LP, 777 Third Avenue, 30th
                                         Floor, New York, NY 10017.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top; font: 10pt Times New Roman, Times, Serif">
<TD STYLE="width: 0%; font: 10pt Times New Roman, Times, Serif"></TD><TD STYLE="width: 0.25in; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(7)</FONT></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consists
                                         of 49,100 shares of common stock and 151,644 shares of common stock underlying the Investment
                                         Warrants. The foregoing excludes 38,481 shares of common stock issuable upon exercise
                                         of the Investment Warrants because the Investment Warrants are subject to a 4.99% beneficial
                                         ownership blocker. Mitchell P. Kopin (&ldquo;Mr. Kopin&rdquo;) and Daniel B. Asher (&ldquo;Mr.
                                         Asher&rdquo;), each of whom are managers of Intracoastal Capital, LLC (&ldquo;Intracoastal&rdquo;),
                                         have shared voting control and investment discretion over the securities reported herein
                                         that are held by Intracoastal. As a result, each of Mr. Kopin and Mr. Asher may be deemed
                                         to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange
                                         Act of 1934, as amended (the &ldquo;Exchange Act&rdquo;)) of the securities reported
                                         herein that are held by Intracoastal. The corporate address of Intracoastal is 245 Palm
                                         Trail, Delray Beach, FL 33483.</FONT></TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-indent: -0.5in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_015"></A>DESCRIPTION
OF SECURITIES</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>General</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
are authorized to issue up to 12,000,000 shares of capital stock, including 7,000,000 shares of common stock, par value $0.001
per share, and 5,000,000 shares of preferred stock, par value $0.001 per share. As of June 15, 2019, we had 3,827,259 shares of
common stock, 278,530 shares of Series A Preferred Stock (as defined below), 673,613 shares of Series B Preferred Stock (as defined
below), and one share of Special Voting Preferred Stock (as defined below) issued and outstanding and 7,813 shares of common stock
issuable upon exchange of Exchangeable Shares of 0959456 B.C. Ltd., a British Columbia corporation (&ldquo;Exchangeco&rdquo;)
(which shares are recognized on an as-exchanged for common stock basis for financial statement purposes).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
additional shares of our authorized stock available for issuance may be issued at times and under circumstances so as to have
a dilutive effect on earnings per share and on the equity ownership of the holders of our common stock. The ability of our board
of directors to issue additional shares of stock could enhance the board&rsquo;s ability to negotiate on behalf of the stockholders
in a takeover situation but could also be used by the board to make a change-in-control more difficult, thereby denying stockholders
the potential to sell their shares at a premium and entrenching current management. The following description is a summary of
the material provisions of our capital stock. You should refer to our articles of incorporation, as amended and bylaws, both of
which are on file with the SEC as exhibits to previous SEC filings, for additional information. The summary below is qualified
by provisions of applicable law.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Common
Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Each
outstanding share of common stock entitles the holder to one vote, either in person or by proxy, on all matters submitted to a
vote of stockholders, including the election of directors. There is no cumulative voting in the election of directors. All actions
required or permitted to be taken by stockholders at an annual or special meeting of the stockholders must be effected at a duly
called meeting, with a quorum present of a majority in voting power of the shares entitled to vote thereon. Special meetings of
the stockholders may only be called by our Board of Directors acting pursuant to a resolution approved by the affirmative majority
of the entire Board of Directors. Stockholders may not take action by written consent. A vote by the holders of a majority of
our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment
to our articles of incorporation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Subject
to preferences which may be applicable to any outstanding shares of preferred stock from time to time, holders of our common stock
have equal ratable rights to such dividends as may be declared from time to time by our Board of Directors out of funds legally
available therefor. In the event of any liquidation, dissolution or winding-up of our affairs, holders of common stock will be
entitled to share ratably in our remaining assets after provision for payment of amounts owed to creditors and preferences applicable
to any outstanding shares of preferred stock. All outstanding shares of common stock are fully paid and nonassessable. Holders
of common stock do not have preemptive rights.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
rights, preferences and privileges of holders of common stock are subject to the rights of the holders of any outstanding shares
of preferred stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Preferred
Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board of Directors is authorized to issue up to 5,000,000 shares of preferred stock, par value $0.001 per share, in one or more
series, 3,721,469 of which shares are undesignated.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board of Directors previously established a series of preferred stock designated as the Special Voting Preferred Stock (&ldquo;Special
Voting Preferred Stock&rdquo;), comprising of one share of Preferred Stock, which remains outstanding as of June 15, 2019. The
Special Voting Preferred Stock is not entitled to receive any dividends declared. In the event of liquidation, the Special Voting
Preferred Stock is not entitled to receive any assets of the Company available for distribution. The Special Voting Preferred
Stock is entitled to cast the number of votes equal to the number of exchangeable shares (&ldquo;Exchangeable Shares&rdquo;) of
0959456 B.C. Ltd. (&ldquo;Exchangeco&rdquo;) outstanding (i) that are not owned by the Company or any affiliated companies and
(ii) as to which the holder of the Special Voting Preferred Stock has received voting instructions from the holders of such Exchangeable
Shares in accordance with the Voting and Exchange Trust Agreement entered into by and among the Company, 0959454 B.C. Ltd., or
Callco, Exchangeco and Computershare Trust Company of Canada. The Special Voting Preferred Stock is entitled to vote as a single
class with the common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board of Directors previously established a series of preferred stock designated as Series A Preferred Stock (&ldquo;Series A
Preferred Stock&rdquo;), comprising 278,530 shares of preferred stock, of which all shares remain outstanding as of June 15, 2019.
Subject to superior rights of any other outstanding preferred stock from time to time, each outstanding share of Series A Preferred
Stock is entitled to receive, in preference to the common stock, cumulative dividends, payable quarterly in arrears, at an annual
rate of 3% of $1.00 per share of Series A Preferred Stock (the &ldquo;Series A Stated Value&rdquo;). Series A Preferred Stock
does not have any voting rights. In the event of liquidation, each share of Series A Preferred Stock is entitled to receive, in
preference to the common stock, a liquidation payment equal to the Series A Stated Value (as adjusted for stock splits, stock
dividends, combinations or other recapitalizations of the Series A Preferred Stock), plus any accrued and unpaid dividends. If
there are insufficient funds to permit full payment, the assets legally available for distribution will be distributed pro rata
among the holders of the Series A Preferred Stock. The Series A Preferred Stock cannot be transferred without the prior written
consent of the Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
Board of Directors previously established a series of preferred stock designated as Series B Preferred Stock (&ldquo;Series B
Preferred Stock&rdquo;), comprising 1,000,000 shares of preferred stock, of which 673,613 shares remain outstanding as of June
15, 2019. Subject to superior rights of any other outstanding preferred stock from time to time, each outstanding share of Series
B Preferred Stock is entitled to receive, in preference to the common stock and pari passu with the Series A Preferred Stock,
annual cumulative dividends equal to 9% of $8.00 per share (the &ldquo;Series B Stated Value&rdquo;), accruing quarterly on the
date of issue and payable quarterly in arrears on December 31, March 31, June 30 and September 30 of each year. At the time shares
of Series B Preferred Stock are converted into common stock, accrued and unpaid dividends will be paid in cash or with shares
of common stock. In the event we elect to declare any dividends on the common stock, the Series B is entitled on an as-converted
basis. Series B Preferred Stock is entitled to vote with common stock, on an as-converted basis, as a single class with common
stock. In the event of liquidation, each share of Series B Preferred Stock is entitled to receive, in preference to the common
stock and pari passu with the Series A Preferred Stock, a liquidation payment equal to the Series B Stated Value plus any accrued
and unpaid dividends. If there are insufficient funds to permit full payment, the assets legally available for distribution will
be distributed pro rata among the holders of the Series B Preferred Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Each
share of Series B Preferred Stock may be converted into 0.25 fully paid shares of common stock at the option of a holder as long
as we have sufficient authorized and unissued shares of common stock available. The conversion rate may be adjusted in the event
of a reverse stock split, merger or reorganization. The Series B Preferred Stock will automatically convert into common stock
on the earlier of (i) five years from April 29, 2016, or (ii) upon the approval of the our VAL-083 by the U.S. Food and Drug Administration
or the European Medicines Agency so long as the closing bid price of our stock at the time of such approval is at least $80.00
per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Preferred
Stock Included in Units Issuable in the Rights Offering</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
will authorize the Series C Convertible Preferred Stock (the &ldquo;Series C Preferred Stock&rdquo;) by filing a certificate of
designation with the Secretary of State of Nevada. The certificate of designation may be authorized by our Board without approval
by our stockholders.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt; background-color: white">Holders
of Series C Preferred Stock will be entitled to receive dividends (on an as-if-converted-to-common-stock basis) in the same form
as dividends actually paid on shares of the common stock when, as and if such dividends are paid on shares of common stock. Except
as otherwise provided in the certificate of designation or as otherwise required by law, the Series C Preferred Stock has no voting
rights. We are not obligated to redeem or repurchase any shares of Series C Preferred Stock. Shares of Series C Preferred Stock
are not otherwise entitled to any redemption rights, or mandatory sinking fund or analogous provisions. In the event of liquidation,
holders of Series</FONT> <FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">C Preferred Stock will be entitled
to receive out of our assets, whether capital or surplus, the same amount that a holder of common stock would receive if the Series
C Preferred Stock were fully converted (disregarding for such purpose any conversion limitations under the certificate of designation)
to common stock, which amounts shall be paid pari passu with all holders of common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
the event we effect certain mergers, consolidations, sales of substantially all of our assets, tender or exchange offers, reclassifications
or share exchanges in which our common stock is effectively converted into or exchanged for other securities, cash or property,
we consummate a business combination in which another person acquires 50% of the outstanding shares of our common stock, or any
person or group becomes the beneficial owner of 50% of the aggregate ordinary voting power represented by our issued and outstanding
common stock, then, upon any subsequent conversion of the Series C Preferred Stock, the holders of the Series C Preferred Stock
will have the right to receive any shares of the acquiring corporation or other consideration it would have been entitled to receive
if it had been a holder of the number of shares of common stock then issuable upon conversion in full of the Series C Preferred
Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Each
share of Series C Preferred Stock will be convertible at our option at any time on or after the first anniversary of the expiration
of the Rights Offering or at the option of the holder at any time, into the number of shares of our common stock determined by
dividing the $1,000 stated value per share of the Series C Preferred Stock by a conversion price of $3.10 per share. In addition,
the conversion price per share is subject to adjustment for stock dividends, distributions, subdivisions, combinations or reclassifications.
Subject to limited exceptions, a holder of the Series C Preferred Stock will not have the right to convert any portion of the
Series C Preferred Stock to the extent that, after giving effect to the conversion, the holder, together with its affiliates,
would beneficially own in excess of 4.99% of the number of shares of our common stock outstanding immediately after giving effect
to its conversion. A holder of the Series C Preferred Stock, upon notice to the Company, may increase or decrease the beneficial
ownership limitation provisions of such holder&rsquo;s Series C Preferred Stock, provided that in no event shall the limitation
exceed 9.99% of the number of shares of our common stock outstanding immediately after giving effect to its conversion.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Anti-takeover
Effects of Nevada Law and our Articles of Incorporation, as amended and Bylaws</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Our
articles of incorporation and bylaws contain a number of provisions that could make our acquisition by means of a tender or exchange
offer, a proxy contest or otherwise more difficult. Certain of these provisions are summarized below.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Special
Meetings</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Special
meetings of the stockholders may only be called by our Board of Directors or such person or person authorized by the Board of
Directors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Business
Combinations Act</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Business Combinations Act, Sections 78.411 to 78.444 of the NRS, restricts the ability of a Nevada &ldquo;resident domestic corporation&rdquo;
having at least 200 stockholders of record to engage in any &ldquo;combination&rdquo; with an &ldquo;interested stockholder&rdquo;
for two (2) years after the date that the person first became an interested stockholder, unless the combination meets all of the
requirements of the articles of incorporation of the resident domestic corporation and (i) the purchase of shares by the interested
stockholder is approved by the board of directors before that date or (ii) the combination is approved by the board of directors
of the resident domestic corporation and, at or after that time, the combination is approved at an annual or special meeting of
the stockholders of the resident domestic corporation, and not by written consent, by the affirmative vote of the holders of stock
representing at least sixty percent (60%) of the outstanding voting power of the resident domestic corporation not beneficially
owned by the interested stockholder or the affiliates or associates of the interested stockholder.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">If
this approval is not obtained, then after the expiration of the two (2) year period, the business combination may still not be
consummated unless it is a combination meeting all of the requirements of the articles of incorporation of the resident domestic
corporation and either the &ldquo;fair price&rdquo; requirements specified in NRS 78.441 to 78.444, inclusive are satisfied or
the combination is (a) a combination or transaction by which the person first became an interested stockholder is approved by
the board of directors of the resident domestic corporation before the person first became an interested stockholder, or (b) a
combination approved by a majority of the outstanding voting power of the resident domestic corporation not beneficially owned
by the interested stockholder, or any affiliate or associate of the interested stockholder.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&ldquo;Interested
stockholder&rdquo; means any person, other than the resident domestic corporation or its subsidiaries, who is (a) the beneficial
owner, directly or indirectly, of 10% or more of the voting power of the outstanding voting shares of the resident domestic corporation
or (b) an affiliate or associate of the resident domestic corporation and at any time within two years immediately before the
date in question was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then outstanding
shares of the resident domestic corporation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
&ldquo;combination&rdquo; is broadly defined and includes, for example, any merger or consolidation of a corporation or any of
its subsidiaries with (i) an interested stockholder or (ii) any other entity that after and as a result of the merger or consolidation
would be an affiliate or associate of the interested stockholder; or any sale, lease, exchange, pledge, transfer or other disposition
of assets of the corporation, in one transaction or a series of transactions, to or with an interested stockholder having: (x)
an aggregate market value equal to more than 5% of the aggregate market value of the assets of a corporation, (y) an aggregate
market value equal to more than 5% of the aggregate market value of all outstanding voting shares of a corporation, or (z) representing
more than 10% of the earning power or net income of a corporation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
provisions of Nevada law, our articles of incorporation and our bylaws could have the effect of discouraging others from attempting
hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock
that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes
in our management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders
may otherwise deem to be in their best interests.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Control
Shares</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Nevada
law also seeks to impede &ldquo;unfriendly&rdquo; corporate takeovers by providing in Sections 78.378 to 78.3793 of the NRS that
an &ldquo;acquiring person&rdquo; shall only obtain voting rights in the &ldquo;control shares&rdquo; purchased by such person
to the extent approved by the other shareholders at a meeting. With certain exceptions, an acquiring person is one who acquires
or offers to acquire a &ldquo;controlling interest&rdquo; in the corporation, defined as one-fifth or more of the voting power.
Control shares include not only shares acquired or offered to be acquired in connection with the acquisition of a controlling
interest, but also all shares acquired by the acquiring person within the preceding 90 days. The statute covers not only the acquiring
person but also any persons acting in association with the acquiring person.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
Nevada corporation may elect to opt out of the provisions of Sections 78.378 to 78.3793 of the NRS. We have no provision in our
articles of incorporation pursuant to which we have elected to opt out of Sections 78.378 to 78.3793; therefore, these sections
do apply to us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Warrants</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of June 15, 2019, we had outstanding warrants issued between January 25 &ndash; March 6, 2013, between July&nbsp;16 &ndash; 31,
2015, between August 1, 2015 to February 1, 2016, May 12, 2016, February 27, 2017, April 19, 2017, September 22, 2017, January
25, 2018, February 27, 2018, September 15, 2018, October 11, 2018, November 25, 2018 and June 5, 2019 to purchase up to 1,669,803
shares of common stock, exercisable at prices ranging from $3.10 per share to $59.30 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stock
Options</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of June 15, 2019, we had issued and outstanding options to purchase up to 292,683 shares of common stock, exercisable at prices
ranging from $6.10 per share to $92.00 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Performance
Stock Units</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
of March 31, 2019, we had issued and outstanding performance stock units to acquire up to 120,000 shares of common stock, which
units were cancelled effective as of April 30, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Potential
Effects of Authorized but Unissued Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have shares of common stock and preferred stock available for future issuance without stockholder approval. We may utilize these
additional shares for a variety of corporate purposes, including future public offerings to raise additional capital, to facilitate
corporate acquisitions or payment as a dividend on the capital stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
existence of unissued and unreserved common stock and preferred stock may enable our board of directors to issue shares to persons
friendly to current management or to issue preferred stock with terms that could render more difficult or discourage a third-party
attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise, thereby protecting the continuity
of our management. In addition, the board of directors has the discretion to determine designations, rights, preferences, privileges
and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences
of each series of preferred stock, all to the fullest extent permissible under the Nevada Revised Statute and subject to any limitations
set forth in our articles of incorporation. The purpose of authorizing the board of directors to issue preferred stock and to
determine the rights and preferences applicable to such preferred stock is to eliminate delays associated with a stockholder vote
on specific issuances. The issuance of preferred stock, while providing desirable flexibility in connection with possible financings,
acquisitions and other corporate purposes, could have the effect of making it more difficult for a third-party to acquire, or
could discourage a third-party from acquiring, a majority of our outstanding voting stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Transfer
Agent and Warrant Agent</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
transfer agent and registrar for our common stock, preferred stock and the warrant agent for the warrants is Mountain Share Transfer,
Inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_016"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>PLAN
OF DISTRIBUTION</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
selling stockholders, which for this purpose includes donees, pledgees, transferees or other successors-in-interest selling shares
of common stock or interests in shares of common stock received after the date of this prospectus from a selling stockholder as
a gift, pledge, dividend, distribution or other transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on any stock exchange, market or trading facility on
which the shares are traded, or in private transactions. These sales or other dispositions may be at fixed prices, at prevailing
market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time
of sale, or at negotiated prices.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
selling stockholders may use any one or more of the following methods when selling our shares or interests in our shares:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">ordinary brokerage
                             transactions and transactions in which the broker-dealer solicits purchasers; </FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">block trades
                                    in which the broker-dealer will attempt to sell the shares as agent but may position and resell
                                    a portion of the block as principal to facilitate the transaction; </FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">purchases by
                                    a broker-dealer as principal and resale by the broker-dealer for its account; </FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">on any national securities
                             exchange or quotation service on which the shares may be listed or quoted at the time of sale; </FONT></TD>
</TR></TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 0in; text-indent: 0in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">privately
                                         negotiated transactions;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 0in; text-indent: 0in"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 0in; text-indent: 0in"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; margin-left: 0in; text-indent: 0in"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">short sales effected
                             after the date of the registration of which this prospectus is a part is declared effective by the
                             SEC;</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">through the
                                    writing or settlement of options or other hedging transactions, whether through an option
                                    exchange or otherwise;</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">broker-dealers
                                    may agree with the selling stockholders to sell a specified number of such shares at a stipulated
                                    price per share;</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">a combination of any
                             such methods of sale; and</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif">&#9679;</FONT></TD><TD><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">any
                                         other method pursuant to applicable law</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif">&nbsp;</FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
selling stockholders may, from time to time, pledge or grant a security interest in some or all of our shares owned by them and,
if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares
of common stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other
applicable provision of the Securities Act, amending the list of selling stockholders to include the pledgee, transferee or other
successors in interest as selling stockholders under this prospectus. The selling stockholders may also transfer our shares in
other circumstances, in which case the transferees, pledgees or other successors will be the selling beneficial owners for purposes
of this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
connection with the sale of our common shares or interests therein, the selling stockholders may enter into hedging transactions
with broker-dealers or other financial institutions, which may in turn engage in short sales of our shares in the course of hedging
the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities
to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities.
The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions
or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution
of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
aggregate proceeds to the selling stockholders from the sale of the common stock offered by them will be the purchase price of
the common stock less discounts or commissions, if any. Each of the selling stockholders reserves the right to accept and, together
with their agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly
or through agents. We will not receive any of the proceeds from sales of shares by the selling stockholders.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
selling stockholders may also resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under
the Securities Act, provided that they meet the criteria and conform to the requirements of that rule, or under Section 4(a)(1)
of the Securities Act, if available, rather than by means of this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
connection with the sale of shares of common stock covered by this prospectus, broker-dealers may receive commissions or other
compensation from a selling stockholder in the form of commissions, discounts or concessions. Broker-dealers may also receive
compensation from purchasers of the shares of common stock for whom they act as agents or to whom they sell as principals or both.
Compensation as to a particular broker-dealer may be in excess of customary commissions or in amounts to be negotiated. In connection
with any underwritten offering, underwriters may receive compensation in the form of discounts, concessions or commissions from
a selling stockholder or from purchasers of the shares for whom they act as agents. Underwriters may sell the shares of common
stock to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as agents. Any underwriters, broker-dealers, agents
or other persons acting on behalf of a selling stockholder that participate in the distribution of the shares of common stock
may be deemed to be &ldquo;underwriters&rdquo; within the meaning of the Securities Act, and any profit on the sale of the shares
of common stock by them and any discounts, commissions or concessions received by any of those underwriters, broker-dealers, agents
or other persons may be deemed to be underwriting discounts and commissions under the Securities Act. The aggregate amount of
compensation in the form of underwriting discounts, concessions, commissions or fees and any profit on the resale of shares by
the selling stockholders that may be deemed to be underwriting compensation pursuant to Financial Industry Regulatory Authority,
Inc., rules and regulations will not exceed applicable limits.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
selling stockholders and any underwriters, broker-dealers or agents that participate in the sale of the common stock or interests
therein may be &ldquo;underwriters&rdquo; within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions,
concessions or profit they earn on any resale of the shares may be underwriting discounts and commissions under the Securities
Act. Selling stockholders who are &ldquo;underwriters&rdquo; within the meaning of Section 2(a)(11) of the Securities Act will
be subject to the prospectus delivery requirements of the Securities Act and may be subject to certain statutory liabilities,
including but not limited to, Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under the Exchange Act.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
the extent required, the shares of our common stock to be sold, the names of the selling stockholders, the respective purchase
prices and public offering prices, the names of any agent, dealer or underwriter, and any applicable commissions or discounts
with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
order to comply with the securities laws of some states, if applicable, the common stock may be sold in these jurisdictions only
through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has
been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied
with.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales
of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, to the extent applicable,
we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling stockholders
for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling stockholders may indemnify
any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities
arising under the Securities Act. All of the foregoing may affect the marketability of the common stock and the ability of any
person or entity to engage in market-making activities with respect to our common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
will pay all expenses of the registration of the common stock for resale by the selling stockholders, including, without limitation,
filing fees and expenses of compliance with state securities or &ldquo;blue sky&rdquo; laws; provided, however, that each selling
stockholder will pay all underwriting discounts and selling commissions, if any, and any related legal expenses incurred by it.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><A NAME="a_017"></A>LEGAL
MATTERS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
validity of the securities offered hereby will be passed upon for us by Fennemore Craig, P.C, Reno, Nevada. Certain other matters
are being passed upon for us by Lowenstein Sandler LLP.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_018"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>EXPERTS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
consolidated financial statements of DelMar Pharmaceuticals, Inc. at June 30, 2018 and 2017, and for the years then ended, appearing
in this Prospectus and Registration Statement have been audited by Ernst &amp; Young LLP, independent registered public accounting
firm, as set forth in their report thereon (which contains an explanatory paragraph describing conditions that raise substantial
doubt about the Company&rsquo;s ability to continue as a going concern as described in Note 1 to the consolidated financial statements)
appearing elsewhere herein, and are included in reliance upon such report given on the authority of such firm as experts in accounting
and auditing.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="a_019"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>WHERE
YOU CAN FIND MORE INFORMATION</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
have filed a registration statement on Form S-1 with the SEC under the Securities Act of 1933, as amended. This prospectus is
part of the registration statement, but the registration statement includes additional information and exhibits. We file annual,
quarterly and current reports, proxy statements and other information with the SEC. The SEC maintains a web site that contains
reports, proxy and information statements and other information regarding companies, such as ours, that file documents electronically
with the SEC. The website address is <I>www.sec.gov.</I> The information on the SEC&rsquo;s website is not part of this prospectus,
and any references to this website or any other website are inactive textual references only. Additionally, you may access our
filings with the SEC through our website at <I>http://www.delmarpharma.com</I>. The information on our website is not part of
this prospectus.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="margin: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0; font: 10pt Times New Roman, Times, Serif"><A NAME="a_020"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
Pharmaceuticals, Inc.</B></FONT></P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>INDEX
TO FINANCIAL STATEMENTS</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Contents</U></B></FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 90%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 10%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Page</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Unaudited
    Consolidated Condensed Interim Financial Statements &ndash; March 31, 2019:</B></FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_001"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Condensed Interim Balance Sheets as of March 31, 2019 and June&nbsp;30, 2018</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-2</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_002"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Condensed Interim Statements of Loss and Comprehensive Loss for the three and nine months ended March 31, 2019 and 2018</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-3</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_003"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Condensed Interim Statements of Cash Flows for the nine months ended March 31, 2019 and 2018</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-4</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_004"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Notes to Consolidated Condensed Interim Financial Statements</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-5 &ndash; F-19</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Consolidated
    Financial Statements &ndash; June 30, 2018 and 2017:</B></FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_005"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Report of Independent-Public Registered Accounting Firm</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-20</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_006"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Balance Sheets as of June 30, 2018 and 2017</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-21</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_007"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Statements of Operations and Comprehensive Loss for the years ended June 30, 2018 and 2017</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-22</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_008"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Statements of Changes in Stockholders&rsquo; Equity for the years ended June 30, 2018 and 2017</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-23</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_009"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated Statements of Cash Flows for the years ended June 30, 2018 and 2017</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-24</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 20pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><A HREF="#Fin_010"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Notes to the Consolidated Financial Statements</FONT></A></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">F-25 &ndash; F-47</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.25pt; border-bottom: Black 1.5pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>
                                                                                                                              <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="Fin_001"></A><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>DelMar
                                         Pharmaceuticals, Inc.</B></FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated
        Condensed Interim Balance Sheets (Unaudited)</FONT></P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Note</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31, <BR> 2019 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Assets</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Current assets</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash and cash equivalents</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,152,233</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,971,995</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Prepaid expenses and deposits</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">240,071</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,034,930</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Interest, taxes and other receivables</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9,086</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">39,519</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Deferred financing costs</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">7,8</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">40,873</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,442,263</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,046,444</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Intangible assets &ndash; net</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">14,863</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">28,411</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,457,126</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,074,855</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Liabilities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Current liabilities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Accounts payable and accrued liabilities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,084,460</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,478,086</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Related party payables</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">113,240</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">160,429</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,197,700</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,638,515</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Derivative liability</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">4</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">265</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,117</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,197,965</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,639,632</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Stockholders&rsquo; equity</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Preferred stock</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Authorized</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">5,000,000 shares, $0.001 par value</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued and outstanding</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">278,530 Series A shares at March 31, 2019 (June 30, 2018 &ndash; 278,530)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3,5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">278,530</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">278,530</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">841,113 Series B shares at March 31, 2019 (June 30, 2018 &ndash; 881,113)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,867,829</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,146,880</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">1 special voting share at March 31, 2019 (June 30, 2018 &ndash; 1)</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Common stock</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Authorized</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">7,000,000 shares (June 30, 2018 &ndash; 7,000,000), $0.001 par value</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">2,620,033 issued at March 31, 2019 (June 30, 2018 &ndash; <BR> 2,296,667)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,620</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,297</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">47,022,252</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">43,198,193</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,055,319</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,229,482</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Accumulated deficit</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(57,988,567</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(52,441,337</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Accumulated other comprehensive income</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">21,178</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">21,178</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,259,161</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">5,435,223</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,457,126</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,074,855</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Going
concern, nature of operations, and corporate history </B>(note 1)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Subsequent
events </B>(note 8)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying notes are an integral part of these consolidated condensed interim financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><A NAME="Fin_002"></A><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT> <FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>DelMar Pharmaceuticals, Inc.</B></FONT> <FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consolidated Condensed Interim Statements of Loss and Comprehensive Loss (Unaudited)</FONT></P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 0; margin-bottom: 0"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid; width: 100%">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Note</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Three months ended <BR> March 31, <BR> 2019 <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Three months ended <BR> March 31, <BR> 2018 <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months ended <BR> March 31, <BR> 2019 <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months <BR> ended <BR> March 31, <BR> 2018 <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold">Expenses</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 42%; text-align: left; text-indent: -10pt; padding-left: 10pt">Research and development</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: center">5</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">735,844</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,779,609</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,702,213</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,856,197</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">General and administrative</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">5</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">935,530</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,155,038</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,796,884</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,911,538</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,671,374</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,934,647</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">5,499,097</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">8,767,735</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Other loss (income)</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Change in fair value of derivative liability</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">189</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,160</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(852</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(57,839</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Foreign exchange loss</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,819</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,420</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">16,754</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">57,406</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Interest income</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(13,397</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(5,850</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(49,513</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(6,241</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(7,389</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(1,590</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(33,611</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(6,674</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Net and comprehensive loss for the period</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,663,985</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,933,057</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">5,465,486</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">8,761,061</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Computation of basic loss per share</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net and comprehensive loss for the period</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,663,985</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,933,057</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,465,486</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,761,061</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Series B Preferred stock dividend</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">23,202</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">46,626</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">75,477</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">142,358</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 20pt">Net and comprehensive loss available to common stockholders</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,687,187</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,979,683</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">5,540,963</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">8,903,419</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Basic and fully diluted loss per share</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">0.67</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1.31</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2.27</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">4.41</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Basic weighted average number of shares</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,518,452</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,283,245</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,444,065</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,017,977</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these consolidated condensed interim financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 2.25pt"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="Fin_003"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
                                         Pharmaceuticals, Inc.</B></FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consolidated
        Condensed Interim Statements of Cash Flows (Unaudited)</FONT></P><!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 0; margin-bottom: 0"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid; width: 100%">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->
</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months ended <BR> March 31,</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Note</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from operating activities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; text-indent: -10pt; padding-left: 10pt">Loss for the period</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(5,465,486</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(8,761,061</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Items not affecting cash</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Amortization of intangible assets</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,548</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,869</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Change in fair value of derivative liability</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(852</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(57,839</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,269</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,821</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,534</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">155,204</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">355,388</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">430,673</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Performance stock unit expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">183,205</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Changes in non-cash working capital</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Interest, taxes and other receivables</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,433</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,578</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Prepaid expenses and deposits</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">794,859</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">135,293</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Accounts payable and accrued liabilities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(425,383</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">708,634</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 20pt">Related party payables</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(47,189</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">33,816</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(4,514,674</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(7,318,012</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from investing activities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Intangible assets &ndash; website development costs</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(12,649</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(12,649</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from financing activities</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net proceeds from the issuance of shares and warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,945,336</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net proceeds from the exercise and exchange of warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5,7</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">726,179</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">312,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A preferred cash dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,267</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,267</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Deferred financing costs</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">7,8</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(25,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">694,912</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">9,251,569</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">(Decrease) increase in cash and cash equivalents</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(3,819,762</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,920,908</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Cash and cash equivalents &ndash; beginning of period</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">5,971,995</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">6,586,014</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Cash and cash equivalents &ndash; end of period</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,152,233</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">8,506,922</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supplementary
information </B>(note 7)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these consolidated condensed interim financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; padding: 0; text-indent: 0"><A NAME="Fin_004"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited) <BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>1</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Going
concern, nature of operations, and corporate history</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Going
concern</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">These
consolidated condensed interim financial statements have been prepared on a going concern basis which assumes that DelMar Pharmaceuticals,
Inc. (the &ldquo;Company&rdquo;) will continue its operations for the foreseeable future and contemplates the realization of assets
and the settlement of liabilities in the normal course of business.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the nine months ended March 31, 2019, the Company reported a loss of $5,465,486, and a negative cash flow from operations of $4,514,674.
The Company had an accumulated deficit of $57,988,567 as of March 31, 2019. As of March 31, 2019, the Company had cash and cash
equivalents on hand of $2,152,233. The Company is in the development stage and has not generated any revenues to date. The Company
does not have the prospect of achieving revenues until such time that its product candidate is commercialized, or partnered, which
may not ever occur. In the near future, the Company will require additional funding to maintain its clinical trials, research
and development projects, and for general operations. These circumstances indicate substantial doubt exists about the Company&rsquo;s
ability to continue as a going concern.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consequently,
management is pursuing various financing alternatives to fund the Company&rsquo;s operations so it can continue as a going concern.
Management plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership
arrangements. The Company may tailor its drug candidate development program based on the amount of funding the Company is able
to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">These
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Nature
of operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company is a clinical stage drug development company with a focus on the treatment of cancer that is conducting clinical trials
in the United States and China with our product candidate, VAL-083, as a potential new treatment for glioblastoma multiforme,
the most common and aggressive form of brain cancer. The Company has also acquired certain commercial rights to VAL-083 in China
where it is approved as a chemotherapy for the treatment of chronic myelogenous leukemia and lung cancer. In order to accelerate
the Company&rsquo;s development timelines, the Company leverages existing clinical and commercial data from a wide range of sources.
The Company may seek marketing partnerships in order to potentially generate future royalty revenue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
address of the Company&rsquo;s administrative offices is Suite 720 - 999 West Broadway, Vancouver, British Columbia, Canada, V5Z
1K5 with clinical operations located at 3485 Edison Way, Suite R, Menlo Park, California, 94025.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Corporate
history</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company is a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. On January 25, 2013, the Company entered
into and closed an exchange agreement (the &ldquo;Exchange Agreement&rdquo;), with Del Mar Pharmaceuticals (BC) Ltd. (&ldquo;Del
Mar (BC)&rdquo;), 0959454 B.C. Ltd. (&ldquo;Callco&rdquo;), and 0959456 B.C. Ltd. (&ldquo;Exchangeco&rdquo;) and the security
holders of Del Mar (BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of the Company
(the &ldquo;Reverse Acquisition&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; padding: 0; font: 10pt Times New Roman, Times, Serif; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>1</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Going
concern, nature of operations, and corporate history </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DelMar
Pharmaceuticals, Inc. is the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010,
which is a clinical stage company with a focus on the development of drugs for the treatment of cancer. The Company is also the
parent company to Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to
facilitate the Reverse Acquisition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">References
to the Company refer to the Company and its wholly-owned subsidiaries, Del Mar (BC), Callco and Exchangeco.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Basis
of presentation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
consolidated condensed interim financial statements of the Company have been prepared in accordance with United States Generally
Accepted Accounting Principles (&ldquo;U.S. GAAP&rdquo;) and are presented in United States dollars. The functional currency of
the Company and each of its subsidiaries is the United States dollar.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying consolidated condensed interim financial statements include the accounts of the Company and its wholly-owned subsidiaries,
Del Mar (BC), Callco, and Exchangeco. All intercompany balances and transactions have been eliminated in consolidation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
principal accounting policies applied in the preparation of these consolidated condensed interim financial statements are set
out below and have been consistently applied to all periods presented.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Unaudited
interim financial data</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying unaudited consolidated condensed interim financial statements have been prepared in accordance with the rules and
regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all
of the information and the notes required by U.S. GAAP for complete financial statements. These unaudited consolidated condensed
interim financial statements should be read in conjunction with the audited financial statements of the Company as at June 30,
2018 included in our Form 10-K. In the opinion of management, the unaudited consolidated condensed interim financial statements
reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation. The results for three
and nine months ended March 31, 2019 are not necessarily indicative of the results to be expected for the fiscal year ending June
30, 2019 or for any other future annual or interim period.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Use
of estimates</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions about future
events that affect the reported amounts of assets, liabilities, expenses, contingent assets and contingent liabilities as at the
end of, or during, the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring
management to make estimates include the derivative liability, the valuation of equity instruments issued for services, and clinical
trial accruals. Further details of the nature of these assumptions and conditions may be found in the relevant notes to these
consolidated condensed interim financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Loss
per share</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Income
or loss per share is calculated based on the weighted average number of common shares outstanding. For the three- and nine-month
periods ended March 31, 2019 and 2018, diluted loss per share does not differ from basic loss per share since the effect of the
Company&rsquo;s warrants, stock options, performance stock units, and
convertible preferred shares is anti-dilutive. As of March 31, 2019, potential shares of common stock of 862,502 (2018 &ndash;
1,428,128) related to outstanding warrants, 292,683 (2018 &ndash; 172,085) relating to stock options, 120,000 (2018 &ndash; 0)
relating to performance stock units, and 210,279 (2018 &ndash; 220,279) relating to outstanding Series B convertible preferred
shares were excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; font: 10pt Times New Roman, Times, Serif; padding-top: 0; padding-right: 0; padding-left: 0; text-indent: 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Recent
accounting pronouncements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">From
time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (&ldquo;FASB&rdquo;) or other
standard setting bodies that are adopted by the Company as of the specified effective date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Recently
adopted</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Accounting
Standards Board (&ldquo;ASU&rdquo;) 2017-09 &mdash; Compensation &mdash; Stock Compensation (Topic 718): Scope of</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Modification
Accounting</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update provide guidance about which changes to the terms, or conditions of a stock-based payment award, require
an entity to apply modification accounting in Topic 718. The amendments in ASU 2017-09 are effective for all entities for annual
periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including
adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not
yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available
for issuance. The adoption of ASU 2017-09 did not have a material impact on our results of operations or financial position.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2016-01 &mdash; Financial Instruments &mdash; Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial
Liabilities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
updated guidance enhances the reporting model for financial instruments and requires entities to use the exit price notion when
measuring the fair value of financial instruments for disclosure purposes, and the separate presentation of financial assets and
financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance
sheet or the accompanying notes to the financial statements. The guidance is effective for annual reporting periods beginning
after December 15, 2017. The adoption of ASU 2016-01 did not have a material impact on our results of operations or financial
position.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Not
yet adopted</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2017-11 &mdash; I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral
for Mandatorily Redeemable Financial Instruments of Certain Non-public Entities and Certain Mandatorily Redeemable Noncontrolling
Interests with a Scope Exception</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update are intended to reduce the complexity associated with the accounting for certain financial instruments
with characteristics of liabilities and equity. Specifically, a down round feature would no longer cause a freestanding equity-linked
financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes
in fair value recognized in current earnings. In addition, the indefinite deferral of certain provisions of Topic 480 have been
re-characterized to a scope exception. The re-characterization has no accounting effect. ASU 2017-11 is effective for public business
entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is
permitted. The Company is currently evaluating the potential impact of the adoption of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2016-02 &mdash; Leases (Topic 842)</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
new standard establishes a right-of-use (&ldquo;ROU&rdquo;) model that requires a lessee to record a ROU asset and a lease liability
on the consolidated balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance
or operating, with classification affecting the pattern of expense recognition in the consolidated income statement. ASU 2016-02
is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods, with
early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases
existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with
certain practical expedients available. The Company is currently evaluating the potential impact of the adoption of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2018-07 &mdash; Stock Compensation (Topic 718) Improvements to Nonemployee Shares-based Payment Accounting</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update are intended to the reduce cost and complexity and to improve financial reporting for share-based payments
issued to nonemployees. The ASU expands the scope of Topic 718, Compensation &mdash;Stock Compensation, which currently only includes
share-based payments issued to employees, to also include share-based payments issued to nonemployees for goods and services.
The existing guidance on nonemployee share-based payments is significantly different from current guidance for employee share-based
payments. This ASU expands the scope of the employee share-based payments guidance to include share-based payments issued to nonemployees.
By doing so, the FASB improves the accounting of nonemployee share-based payments issued to acquire goods and services used in
its own operations. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15,
2018, including interim periods within that fiscal year. The Company is currently evaluating the potential impact of the adoption
of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>3</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Valent
Technologies, LLC</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
September 30, 2014, the Company entered into an exchange agreement (the &ldquo;Valent Exchange Agreement&rdquo;) with Valent Technologies,
LLC (&ldquo;Valent&rdquo;), an entity owned by Dr. Dennis Brown, the Company&rsquo;s Chief Scientific Officer, and Del Mar (BC).
Pursuant to the Valent Exchange Agreement, Valent exchanged its loan payable in the outstanding amount of $278,530 (including
aggregate accrued interest to September 30, 2014 of $28,530), issued to Valent by Del Mar (BC), for 278,530 shares of the Company&rsquo;s
Series A Preferred Stock. The Series A Preferred Stock has a stated value of $1.00 per share (the &ldquo;Series A Stated Value&rdquo;)
and is not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3%
of the Series A Stated Value per year, payable quarterly in arrears.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the three months ended March 31, 2019 and 2018 respectively, the Company recorded $2,089 related to the dividend payable to Valent.
For the nine months ended March 31, 2019 and 2018 respectively, the Company recorded $6,267 related to the dividend payable to
Valent. The dividends have been recorded as a direct increase in accumulated deficit.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>4</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Derivative
liability</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has issued common stock purchase warrants. Based on the terms of certain of these warrants the Company determined that
the warrants were a derivative liability which is recognized at fair value at the date of the transaction and re-measured at fair
value each reporting period with the changes in fair value recorded in the consolidated condensed interim statement of loss and
comprehensive loss.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>4</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Derivative
liability </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company&rsquo;s derivative liability is summarized as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Three months ended<BR> March 31,</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Opening balance</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">76</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,549</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Change in fair value of warrants</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">189</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(2,160</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Closing balance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">265</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,389</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Less current portion</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(5</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Long term portion</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">265</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">3,384</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months ended<BR> March 31,</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Opening balance</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,117</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">61,228</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Change in fair value of warrants</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(852</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(57,839</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Closing balance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">265</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,389</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Less current portion</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(5</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Long term portion</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">265</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">3,384</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
derivative liability consists of the following warrants:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31, <BR> 2019</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> warrants</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">2015 Agent Warrants</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">2,177</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">265</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Closing balance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,177</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">265</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Less current portion</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Long-term portion</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,177</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">265</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Preferred
stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U STYLE="text-decoration: none">&nbsp;</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><U>Series
B Preferred Shares</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the year ended June 30, 2016, the Company issued an aggregate of 902,238 shares of Series B Preferred Stock at a purchase
price of at $8.00 per share. Each share of Series B Preferred Stock is convertible into 0.25 shares of common stock equating
to a conversion price of $32.00 (the &ldquo;Conversion Price&rdquo;) and will automatically convert to common stock at the
earlier of 24 hours following regulatory approval of VAL-083 with a minimum closing bid price of $80.00 or five years from
the final closing date. The holders of the Series B Preferred Stock are entitled to an annual cumulative, in arrears,
dividend at the rate of 9% payable quarterly. The 9% dividend accrues quarterly commencing on the date of issue and is
payable quarterly on June 30, September 30, March 31, and March 31 of each year commencing on June 30, 2016. Dividends are payable solely by delivery of shares of common
stock, in an amount for each holder equal to the aggregate dividend payable to such holder with respect to the shares of Series
B Preferred Stock held by such holder divided by the Conversion Price. The Series B Preferred Stock does not contain any repricing
features. Each share of Series B Preferred Stock entitles its holder to vote with the common stock on an as-converted basis.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, the Company and the holders entered into a royalty agreement, pursuant to which the Company will pay the holders of
the Series B Preferred Stock, in aggregate, a low, single-digit royalty based on their pro rata ownership of the Series B Preferred
Stock on products sold directly by the Company or sold pursuant to a licensing or partnering arrangement (the &ldquo;Royalty Agreement&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Upon
conversion of a holder&rsquo;s Series B Preferred Stock to common stock, such holder shall no longer receive ongoing royalty payments
under the Royalty Agreement but will be entitled to receive any residual royalty payments that have vested. Rights to the royalties
shall vest during the first three years following the applicable closing date, in equal thirds to holders of the Series B Preferred
Stock on each of the three vesting dates, upon which vesting dates such royalty amounts shall become vested royalties.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the Series B Preferred Stock dividend, during the three months ended March 31, 2019, the Company issued 4,735 (2018 &ndash;
4,960) shares of common stock and recognized $23,202 (2018 &ndash; $46,626). During the nine months ended March 31, 2019, the
Company issued 14,430 (2018 &ndash; 14,881) shares of common stock and recognized $75,477 (2018 &ndash; $142,358). These dividends
have been recognized as a direct increase in accumulated deficit.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the nine months ended March 31, 2019, 40,000 Series B Preferred shares were converted to 10,000 shares of common stock. There
were no conversions during the three months ended March 31, 2019 and 2018 or for the nine months ended March 31, 2018. A total
of 841,113 (2018 &ndash; 881,113) shares of Series B Preferred Stock are outstanding as of March 31, 2019, such that a total of
210,279 (2018 &ndash; 220,279) shares of common stock are issuable upon conversion of the Series B Preferred Stock as at March
31, 2019. Converted shares are rounded up to the nearest whole share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Series
A Preferred Shares</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Effective
September 30, 2014 pursuant to the Company&rsquo;s Valent Exchange Agreement (note 3), the Company filed a Certificate of Designation
of Series A Preferred Stock (the &ldquo;Series A Certificate of Designation&rdquo;) with the Secretary of State of Nevada. Pursuant
to the Series A Certificate of Designation, the Company designated 278,530 shares of preferred stock as Series A Preferred Stock.
The shares of Series A Preferred Stock have a stated value of $1.00 per share (the &ldquo;Series A Stated Value&rdquo;) and are
not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3% of the
Series A Stated Value per year, payable quarterly in arrears. Upon any liquidation of the Company, the holder of the Series A
Preferred Stock will be entitled to be paid, out of any assets of the Company available for distribution to stockholders, the
Series A Stated Value of the shares of Series A Preferred Stock held by such holder, plus any accrued but unpaid dividends thereon,
prior to any payments being made with respect to the common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Common
stock</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Shares of common stock outstanding</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Common stock</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Additional paid-in capital</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Warrants</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Accumulated deficit</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD><TD>&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold">Nine&nbsp;months&nbsp;ended&nbsp;March&nbsp;31,&nbsp;2019</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,296,667</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">2,297</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">43,198,193</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">8,229,482</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(52,441,337</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Exercise and exchange of warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">296,667</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">297</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,920,695</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,210,697</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,534</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Conversion of Series B preferred stock to common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">279,041</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B Preferred stock dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,430</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">75,463</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(75,477</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,269</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,267</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">355,388</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Performance stock unit expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">183,205</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A Preferred cash dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,267</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Loss for the period</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(5,465,486</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; March 31, 2019</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,620,033</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,620</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">47,022,252</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,055,319</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">(57,988,567</TD><TD STYLE="padding-bottom: 4pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Three&nbsp;months&nbsp;ended&nbsp;March&nbsp;31,&nbsp;2019</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; December 31, 2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,614,342</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,614</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">46,851,817</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,046,587</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(56,299,291</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Exercise and exchange of warrants &ndash; issue costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(16,186</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,732</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B Preferred stock dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,735</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,197</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(23,202</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">956</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,512</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">99,735</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Performance stock unit expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">60,177</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A Preferred cash dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,089</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Loss for the period</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(1,663,985</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; March 31, 2019</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,620,033</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,620</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">47,022,252</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,055,319</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">(57,988,567</TD><TD STYLE="padding-bottom: 4pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Shares of common stock outstanding</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Common stock</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Additional paid-in capital</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Warrants</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Accumulated deficit</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold">Nine&nbsp;months&nbsp;ended&nbsp;March&nbsp;31,&nbsp;2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2017</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,450,963</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,451</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">36,678,344</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">4,570,574</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(41,118,433</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Issuance of shares and warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">800,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">800</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,191,785</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,752,751</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants exercised for cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">312,475</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">155,204</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B Preferred stock dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,881</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">142,343</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(142,358</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">407</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,821</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">430,673</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A Preferred cash dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(6,267</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Loss for the period</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,761,061</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; March 31, 2018</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,291,251</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,291</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">43,760,441</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,478,529</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">(50,028,119</TD><TD STYLE="padding-bottom: 4pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Three months ended March 31, 2018</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; December 31, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,260,884</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,261</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">43,259,228</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,321,844</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(47,046,347</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants exercised for cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">312,475</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">156,685</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B Preferred stock dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,960</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">46,621</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(46,626</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">407</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,821</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">137,296</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A Preferred cash dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,089</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Loss for the period</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(2,933,057</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; March 31, 2018</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,291,251</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,291</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">43,760,441</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,478,529</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">(50,028,119</TD><TD STYLE="padding-bottom: 4pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
issued and outstanding common shares at March 31, 2019 include 9,063 (June 30, 2018 &ndash; 91,276) shares of common stock on
an as-exchanged basis with respect to the shares of Exchangeco that can be exchanged for shares of common stock of the Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Nine
months ended March 31, 2018</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
September 22, 2017, the Company completed a registered direct offering (the &ldquo;2018 Registered Offering&rdquo;) of an aggregate
of 800,000 shares of common stock and warrants to purchase an additional 800,000 shares of common stock at a price of $12.50 per
share and related warrant for gross proceeds of $10.0 million. The warrants have an exercise price of $12.50 per share, are immediately
exercisable and have a term of exercise of five years (the &ldquo;2018 Investor Warrants&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company engaged a placement agent for the 2018 Registered Offering. Under the Company&rsquo;s engagement agreement with the placement
agent, the Company paid $800,000 in cash commission and other fees to the placement agent and issued warrants to purchase 40,000
shares of common stock to the placement agent (the &ldquo;2018 Agent Warrants&rdquo;). The 2018 Agent Warrants are exercisable
at a per share price of $12.50 and have a term of exercise of five years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to the cash commission and other placement agent fees, the Company also incurred additional cash issue costs of $254,664
resulting in net cash proceeds of $8,945,336.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2017
Omnibus Incentive Plan</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
approved by the Company&rsquo;s stockholders at the annual meeting of stockholders held on April 11, 2018, on July 7, 2017, as
amended on February 1, 2018, the Company&rsquo;s board of directors approved adoption of the Company&rsquo;s 2017 Omnibus Equity
Incentive Plan (the &ldquo;2017 Plan&rdquo;). The board of directors also approved a form of Performance Stock Unit Award Agreement
to be used in connection with grants of performance stock units (&ldquo;PSUs&rdquo;) under the 2017 Plan. Under the 2017 Plan,
780,000 shares of Company common stock are reserved for issuance, less the number of shares of common stock issued under the Del
Mar (BC) 2013 Amended and Restated Stock Option Plan (the &ldquo;Legacy Plan&rdquo;) or that are subject to grants of stock options
made, or that may be made, under the Legacy Plan. A total of 169,985 shares of common stock have been issued under the Legacy
Plan and/or are subject to outstanding stock options granted under the Legacy Plan, and a total of 122,698 shares of common stock
have been issued under the 2017 Plan and/or are subject to outstanding stock options granted under the 2017 Plan. In addition,
120,000 PSU&rsquo;s have been issued under the 2017 Plan leaving a potential 367,317 shares of common stock available for issuance
under the 2017 Plan if all such options under the Legacy Plan were exercised and no new grants are made under the Legacy Plan.
The maximum number of shares of Company common stock with respect to which any one participant may be granted awards during any
calendar year is 8% of the Company&rsquo;s fully diluted shares of common stock on the date of grant (excluding the number of
shares of common stock issued under the 2017 Plan and/or the Legacy Plan or subject to outstanding awards granted under the 2017
Plan and/or the Legacy Plan). No award will be granted under the 2017 Plan on or after July 7, 2027, but awards granted prior
to that date may extend beyond that date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Performance
stock units</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company&rsquo;s board of directors has granted PSUs under the 2017 Plan to the Company&rsquo;s directors. The awards represent
the right to receive shares of the Company&rsquo;s common stock upon vesting of the PSU based on targets approved by the Company&rsquo;s
board of directors related to the Company&rsquo;s fully diluted market capitalization. The PSUs vest at various fully diluted
market capitalization levels with full vesting occurring upon the later of one year from the grant date and the Company achieving
a fully diluted market capitalization of at least $500 million for five consecutive business days. The PSUs expire on July 7,
2022. There are 120,000 PSUs outstanding as of March 31, 2019 and June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has recognized $60,177 (2018 - $0) and $183,205 (2018 - $0) in expense related to the PSUs during the three and nine months
ended March 31, 2019, respectively, with all of it being recognized as general and administrative expense. As at March 31, 2019
there was $342,936 (2018 - $0) in unrecognized compensation expense that will be recognized over the next 2.47 years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
PSUs have been valued using the following assumptions:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 84%; text-align: left; text-indent: -10pt; padding-left: 10pt">Dividend rate</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 15%; text-align: right">0%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Volatility</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right">79.0 to 82.5%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Risk-free rate</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right">2.56% to 2.71%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Term <B>&ndash;</B> years</FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1.67 to 3.24</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stock
Options</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth the stock options outstanding under all plans as of March 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> stock options <BR> outstanding</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted <BR> average <BR> exercise <BR> price</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">262,683</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">24.27</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Granted</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">30,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">6.10</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; March 31, 2019</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">292,683</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">22.40</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table summarizes stock options currently outstanding and exercisable at March 31, 2019 under all plans:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Exercise price <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number <BR> Outstanding</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><P STYLE="margin-top: 0; margin-bottom: 0">Weighted average</P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0">remaining<BR> contractual life <BR> (years)</P></TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number <BR> exercisable</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: center">&nbsp;</TD><TD STYLE="width: 23%; text-align: center">6.10</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; text-align: right">30,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; text-align: right">9.60</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; text-align: right">6,666</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">7.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,451</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.23</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">8.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.59</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">9.83</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">83,647</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.14</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,235</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">10.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,600</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.03</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,200</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">11.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.91</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">14.98</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">20.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,125</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2.52</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,125</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">21.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,900</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.51</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,700</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">29.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5.84</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">32.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.17</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">37.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.86</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">40.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,250</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">41.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.61</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,111</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">42.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.81</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41,250</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">44.80</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.86</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">49.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,460</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5.31</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">18,458</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">53.20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,555</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">61.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: center">92.00</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">3,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: right">4.17</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">3,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 4pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">292,683</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">188,550</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Included
in the number of stock options outstanding are 2,500 stock options granted at an exercise price of CA $20.00. The exercise prices
shown in the above table have been converted to US $14.98 using the period ending closing exchange rate. Certain stock options
have been granted to non-employees and will be revalued at each reporting date until they have fully vested. The stock options
granted, and those being re-valued, have been valued using a Black-Scholes pricing model using the following assumptions:</FONT></P>

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<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 84%; font: 10pt Times New Roman, Times, Serif; padding-top: 10pt; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-top: 10pt; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 15%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>March
    31, <BR>
    2019</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Dividend
    rate</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">0%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Volatility</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">70.6% to 79.1%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Risk-free
    rate</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2.1% to 3.2%</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Term
    - years</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">0.1 to 3.0</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company has recognized the following amounts as stock option expense for the periods noted:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Three months ended <BR> March 31,</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months ended <BR> March 31,</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 52%; text-align: left; text-indent: -10pt; padding-left: 10pt">Research and development</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">12,889</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">9,145</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">64,466</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">130,546</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">General and administrative</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">86,846</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">128,151</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">290,922</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">300,127</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">99,735</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">137,296</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">355,388</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">430,673</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
of the stock option expense for the periods ended March 31, 2019 and 2018 has been recognized as additional paid in capital. The
aggregate intrinsic value of stock options outstanding at March 31, 2019 was $0 (2018 &ndash; $8,400) and the aggregate intrinsic
value of stock options exercisable at March 31, 2019 was $0 (2018 &ndash; $2,800). As of March 31, 2019, there was $234,974 in
unrecognized compensation expense that will be recognized over the next 2.61 years. No stock options granted under any plan have
been exercised to March 31, 2019. Upon the exercise of stock options new shares will be issued.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
summary of the Company&rsquo;s unvested stock options under all plans is presented below:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of Options</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted average <BR> exercise price <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted average <BR> grant date <BR> fair value <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Unvested at June 30, 2018</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">138,160</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">14.39</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">7.63</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2.56</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Vested</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(64,027</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">14.82</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">7.88</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Unvested at March 31, 2019</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">104,133</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">11.62</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">5.95</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Warrants</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Certain
of the Company&rsquo;s warrants have been recognized as a derivative liability (note 4). The following table summarizes changes
in the Company&rsquo;s outstanding warrants as of March 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Description</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 88%; font-weight: bold">Balance &ndash; June 30, 2018</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,428,128</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Exercised for cash (i)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(197,500</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Cashless exchange (i)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(297,500</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left">Issued for services (ii)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left">Forfeited (iii)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(2,400</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt">Expired (iv)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(82,225</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 1.5pt">Balance - March 31, 2019</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; font-weight: bold; text-align: right">862,503</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">i)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
November 25, 2018, the Company entered into Warrant Exercise and Exchange Agreements (the &ldquo;Warrant Exercise Agreements&rdquo;)
with certain holders (the &ldquo;Exercising Holders&rdquo;) of the 2018 Investor Warrants. Pursuant to the Warrant Exercise Agreements,
in order to induce the Exercising Holders to exercise the 2018 Investor Warrants for cash, the Company agreed to reduce the exercise
price from $12.50 to $4.00 per share. Pursuant to the Warrant Exercise Agreements, the Exercising Holders exercised their 2018
Investor Warrants with respect to an aggregate of 197,500 shares of common stock underlying such 2018 Investor Warrants (the &ldquo;Exercised
Shares&rdquo;). The Company received net proceeds of $726,481, comprising aggregate gross proceeds of $790,000 net of expenses
of $63,519, from the exercise of the 2018 Investor Warrants.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; margin-left: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">In addition, in order to further induce the Exercising Holders to exercise the 2018 Investor Warrants, the Warrant Exercise Agreements also provided for the issuance of one share of common stock to the Exercising Holders in exchange for every three shares of common stock underlying the 2018 Investor Warrants held by the Exercising Holders that are not being exercised for cash pursuant to the Warrant Exercise Agreements, if any. On November 26, 2018, the Company issued an aggregate of 99,167 shares of common stock in exchange for 297,500 2018 Investor Warrants, resulting in a 198,333 reduction in the Company&rsquo;s total shares of common stock outstanding on a fully-diluted basis.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">ii)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
of the warrants issued for services are exercisable at $9.00 with 12,000 expiring on September 15, 2023 and 2,000 expiring on
October 11, 2021. Of the total, 12,000 vest pro rata monthly over twelve months commencing September 15, 2018 and 2,000 are fully
vested as of November 11, 2018.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">iii)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Warrants
issued for services exercisable at $11.70 were forfeited upon termination of the underlying agreement.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">iv)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Warrants
issued for services exercisable at $70.40 expired September 12, 2018. In addition, warrants exercisable at $31.40 expired March
31, 2019.</FONT></TD>
</TR></TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table summarizes the Company&rsquo;s outstanding warrants as of March 31, 2019:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 40%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Description</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 11%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Number</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 11%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Exercise
    price <BR>
    $</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 35%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Expiry
    date</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2018
    Investor</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">280,000</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">12.50</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">September 22, 2022</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2017
    Investor</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">207,693</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">35.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">April 19, 2022</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2015
    Investor</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">97,900</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">30.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">July 31, 2020</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2013
    Placement Agent</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">126,250</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">31.40</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June 30, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
    for services</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">26,500</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">30.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">July 1, 2020 to February
    1, 2021</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
    for services</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">6,000</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">17.80</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">January 25, 2023</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
    for services</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">33,600</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">11.70</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">February 27, 2023</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
    for services</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">12,000</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">9.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">September 15, 2023</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
    for services</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">4,140</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">59.30</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">February 27, 2020</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
    for services</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2,000</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">9.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">October 11, 2021</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2018
    Agent</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">40,000</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">12.50</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">September 20, 2022</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2017
    Agent</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">13,846</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">40.60</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">April 12, 2022</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2016
    Agent</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">10,396</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">40.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">May 12, 2021</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2015
    Agent</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2,178</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">30.00</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">July 15, 2020</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 2.25pt double; font: 10pt Times New Roman, Times, Serif; text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>862,503</B></FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">24.80</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>6</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Financial
instruments</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has financial instruments that are measured at fair value. To determine the fair value, we use the fair value hierarchy
for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs
by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use
to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are
inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels of
inputs that may be used to measure fair value are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level
one &mdash; inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level
two &mdash; inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either
directly or indirectly such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted
intervals; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level
three &mdash; unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect
those assumptions that a market participant would use.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Assets
and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes
in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value
hierarchy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company&rsquo;s financial instruments consist of cash and cash equivalents, other receivables, accounts payable, related party
payables and derivative liability. The carrying values of cash and cash equivalents, other receivables, accounts payable and related
party payables approximate their fair values due to the immediate or short-term maturity of these financial instruments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;&nbsp;&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>6</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Financial
instruments </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Derivative
liability</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company accounts for certain warrants under the authoritative guidance on accounting for derivative financial instruments indexed
to, and potentially settled in, a company&rsquo;s own stock, on the understanding that in compliance with applicable securities
laws, the warrants require the issuance of securities upon exercise and do not sufficiently preclude an implied right to net cash
settlement. The Company classifies these warrants on its balance sheet as a derivative liability which is fair valued at each
reporting period subsequent to the initial issuance. The Company has used a Black-Scholes Option Pricing Model (based on a closed-form
model that uses a fixed equation) to estimate the fair value of the share warrants. Determining the appropriate fair-value model
and calculating the fair value of warrants requires considerable judgment. Any change in the estimates (specifically probabilities
and volatility) used may cause the value to be higher or lower than that reported. The estimated volatility of the Company&rsquo;s
common stock at the date of issuance, and at each subsequent reporting period, is based on the historical volatility of the Company.
The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining
life of the warrants at the valuation date. The expected life of the warrants is assumed to be equivalent to their remaining contractual
term.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">a)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Fair
value of derivative liability</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
derivative is not traded in an active market and the fair value is determined using valuation techniques. The Company uses judgment
to select a variety of methods to make assumptions that are based on specific management plans and market conditions at the end
of each reporting period. The Company uses a fair value estimate to determine the fair value of the derivative liability. The
carrying value of the derivative liability would be higher, or lower, as management estimates around specific probabilities change.
The estimates may be significantly different from those amounts ultimately recorded in the consolidated financial statements because
of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an
active market. All changes in the fair value are recorded in the consolidated statement of operations and comprehensive loss each
reporting period. This is considered to be a Level 3 financial instrument as volatility is considered a Level 3 input.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has the following liabilities under the fair value hierarchy:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">March 31, 2019</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Liability</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 1</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 2</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 3</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Derivative liability</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">265</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Liability</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 1</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 2</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 3</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; padding-bottom: 1.5pt">Derivative liability</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1.5pt solid; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 1.5pt solid; text-align: right">1,117</TD><TD STYLE="width: 1%; padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc</B>.<BR>
    Notes to Consolidated Condensed Interim Financial Statements<BR>
    (Unaudited)<BR>
    <B>March 31, 2019</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(expressed
in US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>7</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supplementary
statement of cash flows information</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Nine months ended<BR> March 31,</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2019<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Series B Preferred share common stock dividend (note 5)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">75,477</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">142,358</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B Preferred shares converted to common stock (note 5)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">279,051</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Share issuance costs accrued through accounts payable and accrued liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,884</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Deferred financing costs accrued through accounts payable and accrued liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,873</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Income taxes paid</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Interest paid</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>8</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Subsequent
events</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Reverse
Stock Split</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
May 7, 2019, the Company filed a Certificate of Change with the Secretary of State of Nevada that effected a 1-for-10 (1:10) reverse
stock split of its common stock, par value $0.001 per share, which became effective on May 8, 2019. Pursuant to the Certificate
of Change, the Company&rsquo;s authorized common stock was decreased in the same proportion as the split resulting in a decrease
from 70,000,000 authorized shares of common stock to 7,000,000 shares authorized. The par value of its common stock was unchanged
at $0.001 per share, post-split. All common shares, warrants, stock options, conversion ratios, and per share information in these
consolidated condensed interim financial statements give retroactive effect to the 1-for-10 reverse stock split. The Company&rsquo;s
authorized and issued preferred stock was not affected by the split.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Rights
Offering</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Subsequent
to March 31, 2019, the Company filed a registration statement relating to a rights offering for a maximum gross proceeds of $8.0
million. For every common share of stock owned (including each share of common stock issuable upon exercise of certain outstanding
warrants) as of the record date, the stockholder will receive one basic subscription right, which gives the stockholder the opportunity
to purchase one unit, consisting of one share of the Company&rsquo;s Series C Preferred Stock and 0.50 warrants, for a price of
$1,000 per Unit. The raising of any funds will not be assured until the closing of the offering which is expected to be in the
first week of June 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Performance
Stock Units</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
April 30, 2019, the Company&rsquo;s Board of Directors approved the cancellation of all 120,000 PSU&rsquo;s outstanding at March
31, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2017
Omnibus Plan</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
April 30, 2019, the Company&rsquo;s Board of Directors also approved a temporary reduction in the reserve under the Company&rsquo;s
2017 Plan. As a result, the 367,317 shares of common stock available for issuance under the 2017 Plan as of March 31, 2019 was
reduced to 14,217. If the Company&rsquo;s authorized common shares are increased at the 2019 annual meeting of stockholders, the
reserve will be increased back to 367,317.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><A NAME="Fin_005"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Report
of Independent Registered Public Accounting Firm</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">To
the Board of Directors of DelMar Pharmaceuticals, Inc.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Opinion
on the Consolidated Financial Statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have audited the accompanying consolidated balance sheets of DelMar Pharmaceuticals, Inc. (the &ldquo;Company&rdquo;) as of June
30, 2018 and 2017, the related consolidated statements of operations and comprehensive loss, change in stockholders&rsquo; equity
and cash flows for the years then ended, and the related notes (collectively referred to as the &ldquo;consolidated financial
statements&rdquo;). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated
financial position of the Company as of June 30, 2018 and 2017, and the results of its consolidated operations and its consolidated
cash flows for the years then ended in conformity with U.S. generally accepted accounting principles.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>The
Company&rsquo;s Ability to Continue as a Going Concern</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.
As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has stated that
substantial doubt exists about the Company&rsquo;s ability to continue as a going concern. Management&rsquo;s evaluation of the
events and conditions and management&rsquo;s plans regarding these matters are also described in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of this uncertainty.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Basis
for Opinion</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">These
consolidated financial statements are the responsibility of the Company&rsquo;s management. Our responsibility is to express an
opinion on the Company&rsquo;s consolidated financial statements based on our audits. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the US federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">We
conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether
due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated
financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include
examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated 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 consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/
Ernst &amp; Young LLP</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">We
have served as the Company&rsquo;s auditor since 2016.<BR>
Vancouver, Canada<BR>
September 21, 2018</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">except
for Note 11, as to which the date is</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">May
8, 2019</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><A NAME="Fin_006"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Consolidated Balance Sheets</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; text-decoration: none">&nbsp;</TD><TD STYLE="font-weight: bold; text-decoration: none; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-decoration: none; text-align: center; border-bottom: Black 1.5pt solid">Note</TD><TD STYLE="font-weight: bold; text-decoration: none; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-decoration: none; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold; text-decoration: none">&nbsp;</TD><TD STYLE="font-weight: bold; text-decoration: none; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-decoration: none; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2017 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold; text-decoration: none">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Current assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash and cash equivalents</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%; text-align: center">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,971,995</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">6,586,014</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Prepaid expenses and deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,034,930</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,208,122</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Interest, taxes and other receivables</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">39,519</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">76,595</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,046,444</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,870,731</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Intangible assets &ndash; net</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">28,411</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">40,290</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,074,855</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,911,021</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Current liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Accounts payable and accrued liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,478,086</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,182,312</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Related party payables</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">6</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">160,429</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">88,957</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Current portion of derivative liability</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">4</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">33,091</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,638,515</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,304,360</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Derivative liability</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">4</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,117</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">28,137</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,639,632</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,332,497</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Stockholders&rsquo; equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Preferred stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Authorized</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">5,000,000 shares, $0.001 par value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued and outstanding</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">278,530 Series A shares at June 30, 2018 (June 30, 2017 &ndash; 278,530)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">3,5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">278,530</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">278,530</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">881,113 Series B shares at June 30, 2018 (June 30, 2017 &ndash; 881,113)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,146,880</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,146,880</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">1 special voting share at June 30, 2018 (June 30, 2017 &ndash; 1)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Authorized</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">7,000,000 shares (June 30, 2017 &ndash; 5,000,000), $0.001 par value</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 20pt">2,296,667 issued at June 30, 2018 (June 30, 2017 &ndash; 1,450,963)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,297</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,451</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Additional paid-in capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">43,198,193</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,678,344</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,229,482</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,570,574</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Accumulated deficit</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(52,441,337</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(41,118,433</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Accumulated other comprehensive income</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">21,178</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">21,178</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">5,435,223</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">6,578,524</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,074,855</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7,911,021</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Going
concern, nature of operations, and corporate history </B>(note 1)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Subsequent
events</B> (note 11)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><A NAME="Fin_007"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Consolidated Statements of Operations and Comprehensive Loss</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Note</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Year ended <BR> June 30, <BR> 2018 <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Year ended <BR> June 30, <BR> 2017 <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Expenses</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; text-indent: -10pt; padding-left: 10pt">Research and development</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 11%; text-align: center">6</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">7,132,952</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">5,003,640</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">General and administrative</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">6</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">4,041,711</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">3,317,189</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">11,174,663</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">8,320,829</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Other loss (income)</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Change in fair value of stock option and derivative liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4,5</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(60,111</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(245,963</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Foreign exchange loss</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">57,003</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,355</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Interest income</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(33,243</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(457</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(36,351</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(239,065</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Net and comprehensive loss for the year</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">11,138,312</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">8,081,764</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Computation of basic loss per share</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net and comprehensive loss for the year</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11,138,312</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,081,764</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Series B Preferred stock dividend</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">5</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">176,236</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">790,454</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">11,314,548</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">8,872,218</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Basic and fully diluted loss per share</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">5.42</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">7.36</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Basic weighted average number of shares</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,086,142</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,204,708</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><A NAME="Fin_008"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Consolidated Statements of Changes in Stockholders&rsquo; Equity</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> shares</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Common <BR> stock <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Additional <BR> paid-in <BR> capital <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Accumulated <BR> other <BR> comprehensive <BR> income <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Preferred <BR> stock <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Warrants <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Accumulated <BR> deficit <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Stockholders&rsquo; <BR> equity <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 20%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2016</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,118,702</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">1,119</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">28,843,173</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">21,178</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">6,572,785</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,658,382</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(32,237,859</TD><TD STYLE="width: 0.5%; text-align: left">)</TD><TD STYLE="width: 0.5%">&nbsp;</TD>
    <TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD><TD STYLE="width: 8%; text-align: right">4,858,778</TD><TD STYLE="width: 0.5%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issuance of shares and warrants &ndash; net of issue costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">276,923</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">277</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,981,093</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,950,737</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,932,107</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">563,994</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">564,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">81,602</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">81,602</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Reclassification of stock option liability</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">260,969</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">260,969</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants exercised for cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">23,953</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">908,399</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(120,147</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">788,276</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Cashless exercise of warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">59</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,159</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,159</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Amendment of warrants (note 4)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">53,006</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">53,006</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">124,747</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">124,747</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Conversion of Series B preferred stock to common stock</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,281</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">147,370</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(147,375</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A preferred cash dividend (note&nbsp;3)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8,356</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8,356</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B preferred stock dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20,045</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">790,434</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(790,454</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Loss for the year</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,081,764</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,081,764</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2017</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,450,963</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,451</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">36,678,344</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">21,178</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,425,410</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">4,570,574</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">(41,118,433</TD><TD STYLE="padding-bottom: 4pt; text-align: left">)</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,578,524</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issuance of shares and warrants &ndash; net of issue costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">800,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">800</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,371,693</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,572,843</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,945,336</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">863</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,581</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,582</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">192,400</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">192,400</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants exercised for cash (note&nbsp;5)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">418,810</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(106,335</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">312,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">495,925</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">495,925</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Performance stock unit expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">48,624</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">48,624</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series A preferred cash dividend (note&nbsp;3)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8,356</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(8,356</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Series B preferred stock dividend</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">19,841</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">176,216</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(176,236</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Loss for the year</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(11,138,312</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(11,138,312</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,296,667</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">2,297</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">43,198,193</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">21,178</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,425,410</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">8,229,482</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">(52,441,337</TD><TD STYLE="padding-bottom: 4pt; text-align: left">)</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">5,435,223</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; padding-top: 0pt"><A NAME="Fin_009"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Consolidated Statements of Cash Flows</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Years ended June 30,</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Note</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2017<BR>
$</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from operating activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 65%; text-align: left; text-indent: -10pt; padding-left: 10pt">Loss for the year</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 9%; text-align: center">&nbsp;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(11,138,312</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(8,081,764</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Items not affecting cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Amortization of intangible assets</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">24,528</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">16,683</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Change in fair value of stock option and derivative liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">4,5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(60,111</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(245,963</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Shares issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,582</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">564,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">192,400</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">81,602</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Stock option expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">495,925</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">124,747</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 30pt">Performance stock unit expense</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">48,624</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Changes in non-cash working capital</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Prepaid expenses and deposits</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">8</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">173,192</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(1,063,991</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Interest, taxes and other receivables</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">37,076</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(58,208</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 20pt">Accounts payable and accrued liabilities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">295,774</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">598,310</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 20pt">Related party payables</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">6</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">71,472</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">45,513</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(9,850,850</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,019,071</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from investing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Intangible assets &ndash; website development costs</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(12,649</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(20,956</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(12,649</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(20,956</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Cash flows from financing activities</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Net proceeds from the issuance of shares and warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,945,336</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,932,107</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Proceeds from the exercise of warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">5</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">312,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">545,026</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Series A preferred stock dividend</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">5</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,356</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,356</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">9,249,480</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">8,468,777</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">(Decrease) increase in cash and cash equivalents</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(614,019</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">428,750</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Cash and cash equivalents &ndash; beginning of year</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">6,586,014</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">6,157,264</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Cash and cash equivalents &ndash; end of year</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">5,971,995</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,586,014</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supplementary
information (note 9)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
accompanying notes are an integral part of these consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><A NAME="Fin_010"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>1</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Going
concern, nature of operations, and corporate history</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Going
concern</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">These
consolidated financial statements have been prepared on a going concern basis which assumes that DelMar Pharmaceuticals, Inc.
(the &ldquo;Company&rdquo;) will continue its operations for the foreseeable future and contemplates the realization of assets
and the settlement of liabilities in the normal course of business.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">For
the year ended June 30, 2018, the Company reported a loss of $11,138,312, and a negative cash flow from operations of $9,850,850.
The Company had an accumulated deficit of $52,441,337 as of June 30, 2018. As of June 30, 2018, the Company has cash and cash
equivalents on hand of $5,971,995. The Company is in the development stage and has not generated any revenues to date. The Company
does not have the prospect of achieving revenues until such time that its product candidate is commercialized, or partnered, which
may not ever occur. In the near future, the Company will require additional funding to maintain its clinical trials, research
and development projects, and for general operations. These circumstances indicate substantial doubt exists about the Company&rsquo;s
ability to continue as a going concern.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Consequently,
management is pursuing various financing alternatives to fund the Company&rsquo;s operations so it can continue as a going concern.
Management plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership
arrangements. The Company may tailor its drug candidate development program based on the amount of funding the Company is able
to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">These
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Nature
of operations</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company is a clinical-stage drug development company with a focus on the treatment of cancer that is conducting clinical trials
in the United States with its product candidate, VAL-083, as a potential new treatment for glioblastoma multiforme, the most common
and aggressive form of brain cancer. The Company has also acquired certain commercial rights to VAL-083 in China where it is approved
as a chemotherapy for the treatment of chronic myelogenous leukemia and lung cancer. In order to accelerate the Company&rsquo;s
development timelines, the Company leverages existing clinical and commercial data from a wide range of sources. The Company may
seek marketing partnerships in order to generate future royalty revenue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
address of the Company&rsquo;s administrative offices is Suite 720 &ndash; 999 West Broadway, Vancouver, British Columbia, V5Z
1K5 with clinical operations located at 3485 Edison Way, Suite R, Menlo Park, California, 94025.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Corporate
history</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company is a Nevada corporation formed on June 24, 2009 under the name Berry Only Inc. On January 25, 2013 (the
&ldquo;Reverse Acquisition Closing Date&rdquo;), the Company entered into and closed an exchange agreement (the
&ldquo;Exchange Agreement&rdquo;), with Del Mar Pharmaceuticals (BC) Ltd. (&ldquo;Del Mar (BC)&rdquo;), 0959454 B.C. Ltd.
(&ldquo;Callco&rdquo;), and 0959456 B.C. Ltd. (&ldquo;Exchangeco&rdquo;) and the security holders of Del Mar (BC). Upon
completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of the Company (the &ldquo;Reverse
Acquisition&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DelMar
Pharmaceuticals, Inc. is the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6,
2010, which is a clinical stage company with a focus on the development of drugs for the treatment of cancer. The Company is
also the parent company to Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were
formed to facilitate the Reverse Acquisition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">References to the Company refer to the Company and its wholly-owned
subsidiaries, Del Mar (BC), Callco and Exchangeco.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Reverse
Stock Split</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 16, 2016, the Company filed a Certificate of Change with the Secretary of State of Nevada that effected a 1-for-4 (1:4) reverse
stock split of its common stock, par value $0.001 per share. The reverse split became effective on May 20, 2016. Pursuant to the
Certificate of Change, the Company&rsquo;s authorized common stock was decreased in the same proportion as the split resulting
in a decrease from 20,000,000 authorized shares of common stock to 5,000,000 shares authorized. The par value of its common stock
was unchanged at $0.001 per share, post-split. All common shares, warrants, stock options, conversion ratios, and per share information
in these consolidated financial statements give retroactive effect to the 1-for-4 reverse stock split. The Company&rsquo;s authorized
and issued preferred stock was not affected by the split.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Basis
of presentation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting
principles (&ldquo;US GAAP&rdquo;) and are presented in United States dollars. The Company&rsquo;s functional currency is the
United States dollar.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
principal accounting policies applied in the preparation of these consolidated financial statements are set out below and have
been consistently applied to all years presented.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Consolidation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
consolidated financial statements of the Company include the accounts of Del Mar (BC), Callco, and Exchangeco as at and for the
years ended June 30, 2018 and 2017. Intercompany balances and transactions have been eliminated in consolidation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Use
of estimates</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions about future
events that affect the reported amounts of assets, liabilities, expenses, contingent assets and contingent liabilities as at the
end of, or during, the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring
management to make estimates include the derivative liability, the valuation of equity instruments issued for services, and clinical
trial accruals. Further details of the nature of these assumptions and conditions may be found in the relevant notes to these
consolidated financial statements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Cash
and cash equivalents</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Cash
and cash equivalents consist of cash and highly liquid investments with original maturities from the purchase date of three months
or less that can be readily convertible into known amounts of cash. Cash and cash equivalents are held at recognized Canadian
and United States financial institutions. Interest earned is recognized in the consolidated statement of operations and comprehensive
loss.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Foreign
currency translation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
functional currency of the Company at June 30, 2018 and 2017 is the United States dollar. Transactions that are denominated in
a foreign currency are remeasured into the functional currency at the current exchange rate on the date of the transaction. Any
foreign-currency denominated monetary assets and liabilities are subsequently remeasured at current exchange rates, with gains
or losses recognized as foreign exchange losses or gains in the consolidated statement of operations and comprehensive loss. Non-monetary
assets and liabilities are translated at historical exchange rates. Expenses are translated at average exchange rates during the
period. Exchange gains and losses are included in consolidated statement of operations and comprehensive loss for the period.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Current
and deferred income taxes</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company follows the liability method of accounting for income taxes. Under this method, current income taxes are recognized for
the estimated income taxes payable for the current period. Income taxes are accounted for using the asset and liability method
of accounting. Deferred income taxes are recognized for the future income tax consequences attributable to differences between
the carrying values of assets and liabilities and their respective income tax bases and for loss carry-forwards. Deferred income
tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which
temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change
in tax laws, or rates, is included in earnings in the period that includes the enactment date. When realization of deferred income
tax assets does not meet the more-likely-than-not criterion for recognition, a valuation allowance is provided.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Financial
instruments</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has financial instruments that are measured at fair value. To determine the fair value, the Company uses the fair value
hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable
inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would
use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs
are inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels
of inputs that may be used to measure fair value are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level
one &mdash; inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level
two &mdash; inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either
directly or indirectly such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted
intervals; and</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&#9679;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Level
three &mdash; unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect
those assumptions that a market participant would use.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Assets
and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes
in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value
hierarchy.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company&rsquo;s financial instruments consist of cash and cash equivalents, taxes and other receivables, accounts payable and
accrued liabilities, related party payables and derivative liability. The carrying values of cash and cash equivalents, taxes
and other receivables, accounts payable and accrued liabilities, and related party payables approximate their fair values due
to the immediate, or short-term, maturity of these financial instruments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Derivative
liability</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company accounts for certain warrants under the authoritative guidance on accounting for derivative financial instruments indexed
to, and potentially settled in, a company&rsquo;s own stock, on the understanding that in compliance with applicable securities
laws, the warrants require the issuance of securities upon exercise and do not sufficiently preclude an implied right to net cash
settlement. The Company classifies these warrants on its balance sheet as a derivative liability which is fair valued at each
reporting period subsequent to the initial issuance. The Company has used a binomial model as well as a Black-Scholes Option Pricing
Model (based on a closed-form model that uses a fixed equation) to estimate the fair value of the share warrants. Determining
the appropriate fair-value model and calculating the fair value of warrants requires considerable judgment. Any change in the
estimates (specifically probabilities and volatility) used may cause the value to be higher or lower than that reported. The estimated
volatility of the Company&rsquo;s common stock at the date of issuance, and at each subsequent reporting period, is based on the
historical volatility of the Company. The risk-free interest rate is based on rates published by the government for bonds with
a maturity similar to the expected remaining life of the warrants at the valuation date. The expected life of the warrants is
assumed to be equivalent to their remaining contractual term.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">a)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Fair
value of derivative liability</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
derivative is not traded in an active market and the fair value is determined using valuation techniques. The Company uses judgment
to select a variety of methods to make assumptions that are based on specific management plans and market conditions at the end
of each reporting period. The Company uses a fair value estimate to determine the fair value of the derivative liability. The
carrying value of the derivative liability would be higher, or lower, as management estimates around specific probabilities change.
The estimates may be significantly different from those amounts ultimately recorded in the consolidated financial statements because
of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an
active market. All changes in the fair value are recorded in the consolidated statement of operations and comprehensive loss each
reporting period. This is considered to be a Level 3 financial instrument as volatility is considered a Level 3 input.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has the following liabilities under the fair value hierarchy:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Liability</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 1</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 2</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 3</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Derivative liability</TD><TD STYLE="width: 1%; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 4pt double; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 4pt double; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 4pt double; text-align: right">1,117</TD><TD STYLE="width: 1%; padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="10" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, 2017</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Liability</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 1</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 2</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Level 3</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Derivative liability</TD><TD STYLE="width: 1%; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 4pt double; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 4pt double; text-align: right">&mdash;</TD><TD STYLE="width: 1%; padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="width: 9%; border-bottom: Black 4pt double; text-align: right">61,228</TD><TD STYLE="width: 1%; padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Intangible
assets</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Website
development costs</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Website
development costs are stated at cost less accumulated amortization. The Company capitalizes website development costs associated
with graphics design and development of the website application and infrastructure. Costs related to planning, content input,
and website operations are expensed as incurred. The Company amortizes website development costs on a straight-line basis over
three years. At June 30, 2018, the total capitalized cost was $79,910 (2017 &ndash; $67,261) and the Company has recognized $24,528
and $16,683, respectively, in amortization expense during the years ended June 30, 2018 and 2017.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Patents</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Expenditures
associated with the filing, or maintenance of patents, licensing or technology agreements are expensed as incurred. Costs previously
recognized as an expense are not recognized as an asset in subsequent periods. Once the Company has achieved regulatory approval,
patent costs will be deferred and amortized over the remaining life of the related patent.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Research
and development costs (including clinical trial expenses and accruals)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Research
and development expenses include payroll, employee benefits, stock-based compensation expense, and other headcount-related expenses
associated with research and development. Research and development expenses also include third-party development and clinical
trial expenses noted bel0w. Such costs related to research and development are included in research and development expense until
the point that technological feasibility is reached which, for the Company&rsquo;s drug candidate, is generally shortly before
the drug is approved by the relevant food and drug administration. Once technological feasibility is reached, such costs will
be capitalized and amortized to cost of revenue over the estimated life of the product.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Clinical
trial expenses are a component of research and development costs and include fees paid to contract research organizations, investigators
and other service providers who conduct specific research for development activities on behalf of the Company. The amount of clinical
trial expenses recognized in a period related to service agreements is based on estimates of the work performed on an accrual
basis. These estimates are based on patient enrollment, services provided and goods delivered, contractual terms and experience
with similar contracts. The Company monitors these factors by maintaining regular communication with the service providers. Differences
between actual expenses and estimated expenses recorded are adjusted for in the period in which they become known. Prepaid expenses
or accrued liabilities are adjusted if payments to service providers differ from estimates of the amount of service completed
in a given period.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Research
and development costs are expensed in the period incurred. As at June 30, 2018 and 2017, all research and development costs have
been expensed.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Shares
for services</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has issued equity instruments for services provided by employees and non-employees. The equity instruments are valued
at the fair value of the instrument granted.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Stock
options</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company accounts for these awards under Accounting Standards Codification (&ldquo;ASC&rdquo;) 718, &ldquo;Compensation &mdash;
Stock Compensation&rdquo; (&ldquo;ASC 718&rdquo;). ASC 718 requires measurement of compensation cost for all stock-based awards
at fair value on the date of grant and recognition of compensation over the requisite service period for awards expected to vest.
Compensation expense for unvested options to non-employees is revalued at each period end and is being amortized over the vesting
period of the options. The determination of grant-date fair value for stock option awards is estimated using the Black-Scholes
model, which includes variables such as the expected volatility of the Company&rsquo;s share price, the anticipated exercise behavior
of its grantee, interest rates, and dividend yields. These variables are projected based on the Company&rsquo;s historical data,
experience, and other factors. Changes in any of these variables could result in material adjustments to the expense recognized
for share-based payments. Such value is recognized as expense over the requisite service period, net of actual forfeitures, using
the accelerated attribution method. The Company recognizes forfeitures as they occur. The estimation of stock awards that will
ultimately vest requires judgment, and to the extent actual results, or updated estimates, differ from current estimates, such
amounts are recorded as a cumulative adjustment in the period estimates are revised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Performance
stock units</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company also accounts for performance stock units (PSU&rsquo;s) under ASC 718. ASC 718 requires measurement of compensation cost
for all stock-based awards at fair value on the date of grant and recognition of compensation over the requisite service period
for awards expected to vest. As vesting of the PSU&rsquo;s is based on a number of factors, the determination of the grant-date
fair value for PSU&rsquo;s has been estimated using a Monte Carlo simulation approach which includes variables such as the expected
volatility of the Company&rsquo;s share price and interest rates to generate potential future outcomes. These variables are projected
based on the Company&rsquo;s historical data, experience, and other factors. Changes in any of these variables could result in
material adjustments to the expense recognized for the PSUs. Such value is recognized as expense over the derived service period
using the accelerated attribution method. The estimation of PSUs that will ultimately vest requires judgment, and to the extent
actual results, or updated estimates, differ from current estimates, such amounts are recorded as a cumulative adjustment in the
period estimates are revised.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Comprehensive
income</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
accordance with ASC 220, &ldquo;Comprehensive Income&rdquo; (&ldquo;ASC 220&rdquo;), all components of comprehensive income, including
net loss, are reported in the financial statements in the period in which they are recognized. Comprehensive income is defined
as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net loss
and other comprehensive (income) loss, including foreign currency translation adjustments, are reported, net of any related tax
effect, to arrive at comprehensive income. No taxes were recorded on items of other comprehensive income.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Loss
per share</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Income
or loss per share is calculated based on the weighted average number of common shares outstanding. For the years ended June 30,
2018 and 2017 diluted loss per share does not differ from basic loss per share since the effect of the Company&rsquo;s warrants,
stock options, performance stock units, and convertible preferred shares is anti-dilutive. As at June 30, 2018, potential common
shares of 1,690,810 (2017 &ndash; 774,976) related to outstanding warrants and stock options, 120,000 (2017 &ndash; 0) relating
to performance stock units, and 220,279 (2017 &ndash; 220,279) relating to outstanding Series B convertible preferred shares were
excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Segment
information</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company identifies its operating segments based on business activities, management responsibility and geographical location. The
Company operates within a single operating segment being the research and development of cancer indications, and operates primarily
in one geographic area, being North America. The Company is conducting one clinical trial in China but the planned expenses to
be incurred over the course of the study are not expected to be significant. All of the Company&rsquo;s assets are located in
either Canada or the United States.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Recent
accounting pronouncements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">From
time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board (&ldquo;FASB&rdquo;) or other
standard setting bodies that are adopted by the Company as of the specified effective date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Recently
adopted</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Accounting
Standards Board (&ldquo;ASU&rdquo;) 2016-09 &mdash; Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment
Accounting</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update change existing guidance related to accounting for employee share-based payments affecting the income
tax consequences of awards, classification of awards as equity or liabilities, and classification on the statement of cash flows.
ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those
annual periods, with early adoption permitted. The adoption of ASU 2016-09 did not have a material impact on our results of operations
or financial condition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Not
yet adopted</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2016-01 &mdash; Financial Instruments &mdash; Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial
Liabilities</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
updated guidance enhances the reporting model for financial instruments and requires entities to use the exit price</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">notion when
measuring the fair value of financial instruments for disclosure purposes, and the separate presentation of financial assets and
financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance
sheet or the accompanying notes to the financial statements. The guidance is effective for annual reporting periods beginning
after December 15, 2017. The adoption of ASU 2016-01 is not expected to have a material impact on our results of operations or
financial condition.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2017-09 &mdash; Compensation &mdash; Stock Compensation (Topic 718): Scope of Modification Accounting</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update provide guidance about which changes to the terms, or conditions of a stock-based payment award, require
an entity to apply modification accounting in Topic 718. The amendments in ASU 2017-09 are effective for all entities for annual
periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including
adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not
yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available
for issuance. The Company is currently evaluating the potential impact of the adoption of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2017-11 &mdash; I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral
for Mandatorily Redeemable Financial Instruments of Certain Non-public Entities and Certain Mandatorily Redeemable Noncontrolling
Interests with a Scope Exception</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update are intended to reduce the complexity associated with the accounting for certain financial instruments
with characteristics of liabilities and equity. Specifically, a down round feature would no longer cause a freestanding equity-linked
financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes
in fair value recognized in current earnings. In addition, the indefinite deferral of certain provisions of Topic 480 have been
re-characterized to a scope exception. The re-characterization has no accounting effect. ASU 2017-11 is effective for public business
entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.Early adoption is
permitted. The Company is currently evaluating the potential impact of the adoption of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>2</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Significant
accounting policies </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2016-02 &mdash; Leases (Topic 842)</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
new standard establishes a right-of-use (&ldquo;ROU&rdquo;) model that requires a lessee to record a ROU asset and a lease liability
on the consolidated balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance
or operating, with classification affecting the pattern of expense recognition in the consolidated income statement. ASU 2016-02
is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods, with
early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases
existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with
certain practical expedients available. The Company is currently evaluating the potential impact of the adoption of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>ASU
2018-07 &mdash; Stock Compensation (Topic 718) Improvements to Nonemployee Shares-based payment Accounting</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
amendments in this update are intended to the reduce cost and complexity and to improve financial reporting for share-based payments
issued to nonemployees. The ASU expands the scope of Topic 718, Compensation &mdash; Stock Compensation, which currently only
includes share-based payments issued to employees, to also include share-based payments issued to nonemployees for goods and services.
The existing guidance on nonemployee share-based payments is significantly different from current guidance for employee share-based
payments. This ASU expands the scope of the employee share-based payments guidance to include share-based payments issued to nonemployees.
By doing so, the FASB improves the accounting of nonemployee share-based payments issued to acquire goods and services used in
its own operations. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15,
2018, including interim periods within that fiscal year. The Company is currently evaluating the potential impact of the adoption
of this standard.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>3</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Valent
Technologies LLC agreements</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">One
of the Company&rsquo;s officers is a principal of Valent Technologies, LLC (&ldquo;Valent&rdquo;) and as result Valent is a related
party to the Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
September 12, 2010, the Company entered into a Patent Assignment Agreement (the &ldquo;Valent Assignment Agreement&rdquo;) with
Valent pursuant to which Valent transferred to the Company all of its rights, title and interest in and to the patents for VAL-083
owned by Valent. The Company now owns all rights and title to VAL-083 and is responsible for the drug&rsquo;s further development
and commercialization. In accordance with the terms of the Valent Assignment Agreement, Valent is entitled to receive a future
royalty on all revenues derived from the development and commercialization of VAL-083. In the event that the Company terminates
the agreement, the Company may be entitled to receive royalties from Valent&rsquo;s subsequent development of VAL-083 depending
on the development milestones the Company has achieved prior to the termination of the Valent Assignment Agreement.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
September 30, 2014, the Company entered into an exchange agreement (the &ldquo;Valent Exchange Agreement&rdquo;) with Valent and
Del Mar (BC). Pursuant to the Valent Exchange Agreement, Valent exchanged its loan payable in the outstanding amount of $278,530
(including aggregate accrued interest to September 30, 2014 of $28,530), issued to Valent by Del Mar (BC), for 278,530 shares
of the Company&rsquo;s Series A Preferred Stock. The Series A Preferred Stock has a stated value of $1.00 per share (the &ldquo;Series
A Stated Value&rdquo;) and is not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends
at the rate of 3% of the Series A Stated Value per year, payable quarterly in arrears. For each of the years ended June 30, 2018
and 2017 the Company recorded $8,356 related to the dividend paid to Valent. The dividends have been recorded as a direct increase
in accumulated deficit.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the year ended June 30, 2017, Valent exercised 12,500 common stock purchase warrants that had been issued to Valent pursuant to
the Valent Assignment Agreement. The exercised warrants represented all warrants that had been issued to Valent. The warrants
were exercised at $15.40 per share (CA $20.00) for total proceeds of $192,075.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>4</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Derivative
liability</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company has issued common stock purchase warrants. Based on the terms of certain of these warrants the Company determined that
the warrants were a derivative liability which is recognized at fair value at the date of the transaction and remeasured at fair
value each reporting period with the changes in fair value recorded in the consolidated statement of operations and comprehensive
loss.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>&nbsp;</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><I>2013
Investor Warrants</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the quarter ended March 31, 2013 the Company issued an aggregate of 328,125 units at a purchase price of $32.00 per unit, for
aggregate gross proceeds of $10,500,000. Each unit consisted of one share of common stock and one five-year warrant (the &ldquo;2013
Investor Warrants&rdquo;) to purchase one share of common stock at an initial exercise price of $32.00. The exercise price of
the 2013 Investor Warrants is subject to adjustment in the event that the Company issues common stock at a price lower than the
exercise price, subject to certain exceptions. The 2013 Investor Warrants are redeemable by the Company at a price of $0.04 per
2013 Investor Warrant at any time subject to the conditions that (i) the Company&rsquo;s common stock has traded for twenty (20)
consecutive trading days with a closing price of at least $64.00 per share with an average trading volume of 50,000 shares per
day, and (ii) the underlying shares of common stock are registered for resale.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
a result of the financing completed by the Company during the three months ended September 30, 2015, the exercise price of all
of the 2013 Investor Warrants was reduced from $32.00 to $31.40. As a result of the financing completed by the Company during
the three months ended September 30, 2017, the exercise price of certain of the 2013 Investor Warrants was further reduced from
$31.40 to $26.80. The change in exercise price did not result in a material change in the fair value of the derivative liability.
All of the 2013 Investor Warrants giving rise to their respective portion of the derivative liability have expired as of June
30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>2013
Investor Warrant exercises</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the year ended June 30, 2017, 6,010 of the 2013 Investor Warrants were exercised at an exercise price of $31.40 per share. Also,
500 of the previously amended 2013 Investor Warrants were exercised. The Company received proceeds of $204,659 from these exercises.
The warrants that have been exercised were revalued at their respective exercise dates and then the reclassification to equity
was recorded resulting in $238,474 of the derivative liability being reclassified to equity.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
were no exercises of 2013 Investor Warrants during the year ended June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U STYLE="text-decoration: none">&nbsp;</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><U>2013
Investor Warrant amendments</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the year ended June 30, 2017, 1,594 of the 2013 Investor Warrants were amended. As a result, the Company has reclassified $53,006
from the derivative liability to equity. The 2013 Investor Warrants were revalued to their respective amendment dates and were
then reclassified to equity.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
were no amendments of 2013 Investor Warrants during the year ended June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>2015
Agent Warrants</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
part of the Company&rsquo;s financing completed in a prior period, the Company issued warrants to purchase 2,348 shares of common
stock to certain placement agents (&ldquo;2015 Agent Warrants&rdquo;) and recognized them as a&nbsp;derivative
liability of $29,594 at the time of issuance. The 2015 Agent Warrants are exercisable at a per share price equal to $30.00 until
July 15, 2020. During the year ended June 30, 2017, 68 of the 2015 Agent Warrants were exercised for cash proceeds of $2,040 and
100 of the 2015 Agent Warrants were exercised on a cashless basis for 59 shares of common stock. The total reclassification to
equity subsequent to revaluation at the respective exercise dates was $9,935.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>4</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Derivative
liability </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">There
were no exercises of the 2015 Agent Warrants during the year ended June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company&rsquo;s derivative liability is summarized as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Years ended <BR> June 30,</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2017<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Opening balance</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">61,228</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">693,700</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Change in fair value of warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(60,111</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(331,057</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Reclassification to equity upon amendment of warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(53,006</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Reclassification to equity upon exercise of warrants</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(248,409</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Closing balance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,117</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">61,228</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Less current portion</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(33,091</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Long-term portion</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,117</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">28,137</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
derivative liability consists of the following warrants as at June 30, 2018 and 2017:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Year ended <BR> June 30, 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> warrants</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">4,375</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">2015 Agent warrants</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,177</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,117</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Closing balance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,552</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,117</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Less current portion</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Long-term portion</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,552</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">1,117</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD><B><U></U></B></TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt"><B><U STYLE="text-decoration: none">&nbsp;</U></B></TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid"><B><U STYLE="text-decoration: none">Year
    ended <BR> June 30, 2017</U></B></TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold"></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> warrants</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">2013 investor warrants</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">10,513</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">33,091</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,375</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,468</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">2015 Agent warrants</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,177</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">23,669</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-align: left; text-indent: -10pt; padding-left: 10pt">Closing balance</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,065</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">61,228</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Less current portion</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(10,513</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(33,091</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-align: left; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Long-term portion</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">6,552</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">28,137</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 12pt"><P STYLE="margin: 0pt">&nbsp;</P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency)</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Preferred
stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Authorized</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">5,000,000
preferred shares, $0.001 par value</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issued
and outstanding</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Special
voting shares &ndash; at June 30, 2018 and 2017 &ndash; 1</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Series
A shares &ndash; at June 30, 2018 &ndash; 278,530 (June 30, 2017 &ndash; 278,530)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Series
B shares &ndash; at June 30, 2018 &ndash; 881,113 (June 30, 2017 &ndash; 881,113)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Series
B Preferred Shares</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the year ended June 30, 2016, the Company issued an aggregate of 902,238 shares of Series B Preferred Stock at a purchase price
of at $8.00 per share. Each share of Series B Preferred Stock is convertible into 0.25 shares of common stock equating to a conversion
price of $32.00 (the &ldquo;Conversion Price&rdquo;) and will automatically convert to common stock at the earlier of 24 hours
following regulatory approval of VAL-083 with a minimum closing bid price of $80.00 or five years from the final closing date.
The holders of the Series B Preferred Stock are entitled to an annual cumulative, in arrears, dividend at the rate of 9% payable
quarterly. The 9% dividend accrues quarterly commencing on the date of issue and is payable quarterly on June 30, September 30,
December 31, and March 31 of each year commencing on June 30, 2016. Dividends are payable solely by delivery of shares of common
stock, in an amount for each holder equal to the aggregate dividend payable to such holder with respect to the shares of Series
B Preferred Stock held by such holder divided by the Conversion Price. The Series B Preferred Stock does not contain any repricing
features. Each share of Series B Preferred Stock entitles its holder to vote with the common stock on an as-converted basis.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition, the Company and the holders entered into a royalty agreement, pursuant to which the Company will pay the holders of
the Series B Preferred Stock, in aggregate, a low, single-digit royalty based on their pro rata ownership of the Series B Preferred
Stock on products sold directly by the Company or sold pursuant to a licensing or partnering arrangement (the &ldquo;Royalty Agreement&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Upon
conversion of a holder&rsquo;s Series B Preferred Stock to common stock, such holder shall no longer receive ongoing royalty payments
under the Royalty Agreement but will be entitled to receive any residual royalty payments that have vested. Rights to the royalties
shall vest during the first three years following the applicable closing date, in equal thirds to holders of the Series B Preferred
Stock on each of the three vesting dates, upon which vesting dates such royalty amounts shall become vested royalties.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the Series B Preferred Stock dividend, during the year ended June 30, 2018, the Company issued 19,841 (2017 &ndash; 20,045)
shares of common stock and recognized $176,236 (2017 &ndash; $790,454) as a direct increase in accumulated deficit. During the
year ended June 30, 2018, a total of 0 (2017 &ndash; 21,125) shares of Series B Preferred Stock were converted for an aggregate
0 (2017 &ndash; 5,281) shares of common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
total of 881,113 (2017 &ndash; 881,113) shares of Series B Preferred Stock are outstanding as of June 30, 2018, such that a total
of 220,279 (2017 &ndash; 220,279) shares of common stock are issuable upon conversion of the Series B Preferred Stock as at June
30, 2018. Converted shares are rounded up to the nearest whole share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Series
A Preferred Shares</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Effective
December 31, 2014 pursuant to the Company&rsquo;s Valent Exchange Agreement (note 3), the Company filed a Certificate of Designation
of Series A Preferred Stock (the &ldquo;Series A Certificate of Designation&rdquo;) with the Secretary of State of Nevada. Pursuant
to the Series A Certificate of Designation, the Company designated 278,530 shares of preferred stock as Series A Preferred Stock.
The shares of Series A Preferred Stock have a stated value of $1.00 per share (the &ldquo;Series A Stated Value&rdquo;) and are
not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3% of the
Series A Stated Value per year, payable quarterly in arrears. Upon any liquidation of the Company, the holder of the Series A
Preferred Stock will be entitled to be paid, out of any assets of the Company available for distribution to stockholders, the
Series A Stated Value of the shares of Series A Preferred Stock held by such holder, plus any accrued but unpaid dividends thereon,
prior to any payments being made with respect to the common stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Special
voting shares</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
connection with the Exchange Agreement (note 1), on the Reverse Acquisition Closing Date, the Company, Callco, Exchangeco and
Computershare Trust Company of Canada (the &ldquo;Trustee&rdquo;) entered into a voting and exchange trust agreement (the &ldquo;Trust
Agreement&rdquo;). Pursuant to the Trust Agreement, Company issued one share of Special Voting Preferred Stock (the &ldquo;Special
Voting Share&rdquo;) to the Trustee, and the parties created a trust for the Trustee to hold the Special Voting Share for the
benefit of the holders of the shares of Exchangeco acquired as part of the Reverse Acquisition (the &ldquo;Exchangeable Shares&rdquo;)
(other than the Company and any affiliated companies) (the &ldquo;Beneficiaries&rdquo;). Pursuant to the Trust Agreement, the
Beneficiaries will have voting rights in the Company equivalent to what they would have had they received shares of common stock
in the same amount as the Exchangeable Shares held by the Beneficiaries.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
connection with the Exchange Agreement and the Trust Agreement, on January 17, 2013, the Company filed a certificate of designation
of Special Voting Preferred Stock (the &ldquo;Special Voting Certificate of Designation&rdquo;) with the Secretary of State of
Nevada. Pursuant to the Special Voting Certificate of Designation, one share of the Company&rsquo;s blank check preferred stock
was designated as Special Voting Preferred Stock. The Special Voting Preferred Stock votes as a single class with the common stock
and is entitled to a number of votes equal to the number of Exchangeable Shares of Exchangeco outstanding as of the applicable
record date (i) that are not owned by the Company or any affiliated companies and (ii) as to which the holder has received voting
instructions from the holders of such Exchangeable Shares in accordance with the Trust Agreement.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Special Voting Preferred Stock is not entitled to receive any dividends or to receive any assets of the Company upon any liquidation,
and is not convertible into common stock of the Company.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
voting rights of the Special Voting Preferred Stock will terminate pursuant to and in accordance with the Trust Agreement. The
Special Voting Preferred Stock will be automatically cancelled at such time as the share of Special Voting Preferred Stock has
no votes attached to it.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Common
stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Authorized</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">7,000,000
as at June 30, 2018 (2017 &ndash; 5,000,000) common shares, $0.001 par value</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Issued
and outstanding at June 30, 2018 &ndash; 2,296,667 (2017 &ndash; 1,450,963). The issued and outstanding common shares at June
30, 2018 include 91,276 (2017 &ndash;98,276) shares of common stock on an as-exchanged basis with respect to the Exchangeable
Shares.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Public
offering financings</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Year
ended June 30, 2018</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
September 22, 2017 the Company completed a registered direct offering (the &ldquo;2018 Registered Offering&rdquo;) of an aggregate
of 800,000 shares of common stock and warrants to purchase an additional 800,000 shares of common stock at a price of $12.50 per
share and related warrant for gross proceeds of $10.0 million. The warrants have an exercise price of $12.50 per share, are immediately
exercisable and have a term of exercise of five years (the &ldquo;2018 Investor Warrants&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company engaged a placement agent for the 2018 Registered Offering. Under the Company&rsquo;s engagement agreement with the placement
agent, the Company paid $800,000 in cash commission and other fees to the placement agent and issued warrants to purchase 40,000
shares of common stock to the placement agent (the &ldquo;2018 Agent Warrants&rdquo;). The 2018 Agent Warrants are exercisable
at a per share price of $12.50 and have a term of exercise of five years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to the cash commission and other placement agent fees, the Company also incurred additional cash issue costs of $254,664
resulting in net cash proceeds of $8,945,336.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Year
ended June 30, 2017</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
April 12, 2017 the Company completed a registered public offering (the &ldquo;2017 Public Offering&rdquo;) of an aggregate of
276,923 shares of common stock and warrants to purchase an additional 207,692 shares of common stock at a price of $32.50 per
share and related warrant for gross proceeds of approximately $9.0 million. The related warrants have an exercise price of $35.00
per share, are immediately exercisable, and have a term of exercise of five years (the &ldquo;2017 Investor Warrants&rdquo;).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company engaged a placement agent for the 2017 Public Offering. Under the Company&rsquo;s engagement agreement with the placement
agent, the Company agreed to pay up to an 8% cash commission and issue warrants to purchase shares of common stock (the &ldquo;2017
Agent Warrants&rdquo;) up to the number of shares of common stock equal to 5% of the aggregate number of shares issued in the
2017 Public Offering. Pursuant to the placement agent agreement the Company issued 13,846 2017 Agent Warrants. The 2017 Agent
Warrants are exercisable at a per share price equal to $40.60 and have a term of exercise of five years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">In
addition to the cash commission the Company also incurred additional cash issue costs of $347,897 resulting in net cash proceeds
of $7,932,107. The 2017 Agent Warrants have been recognized as non-cash issue costs of $424,401. Including the fair value of the
2017 Agent Warrants, total issue costs were $1,492,298.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Shares
issued for services</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the year ended June 30, 2018, the Company issued 863 (2017 &ndash; 6,000) shares of common stock for services resulting in the
recognition of $8,582 (2017 &ndash; $564,000) in expense. All of the shares issued for services for the year ended June 30, 2018
have been recognized as general and administrative expense and all of the shares issued for services for the year ended June 30,
2017 have been recognized as research and development expense.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>2017
Omnibus Incentive Plan</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
approved by the Company&rsquo;s stockholders at the annual meeting of stockholders held on April 11, 2018, on July 7, 2017, as
amended on February 1, 2018, the Company&rsquo;s board of directors approved adoption of the Company&rsquo;s 2017 Omnibus Equity
Incentive Plan (the &ldquo;2017 Plan&rdquo;). The board of directors also approved a form of Performance Stock Unit Award Agreement
to be used in connection with grants of performance stock units (&ldquo;PSUs&rdquo;) under the 2017 Plan. Under the 2017 Plan,
780,000 shares of Company&nbsp;common stock are reserved for issuance, less the number of shares of common stock issued under
the Del Mar (BC) 2013 Amended and Restated Stock Option Plan (the &ldquo;Legacy Plan&rdquo;) or that are subject to grants of
stock options made, or that may be made, under the Legacy Plan. A total of 169,985 shares of common stock, net of forfeitures,
have been issued under the Legacy Plan and/or are subject to outstanding stock options granted under the Legacy Plan, and a total
of 92,698 shares of&nbsp;common
stock have been issued under the 2017 Plan and/or are subject to outstanding stock options granted under the 2017 Plan. In addition,
120,000 PSU&rsquo;s have been issued under the 2017 Plan leaving a potential 397,317 shares of common stock available for issuance
under the 2017 Plan if all such options under the Legacy Plan were exercised and no new grants are made under the Legacy Plan.
The maximum number of shares of Company common stock with respect to which any one participant may be granted awards during any
calendar year is 8% of the Company&rsquo;s fully diluted shares of common stock on the date of grant (excluding the number of
shares of common stock issued under the 2017 Plan and/or the Legacy Plan or subject to outstanding awards granted under the 2017
Plan and/or the Legacy Plan). No award will be granted under the 2017 Plan on or after July 7, 2027, but awards granted prior
to that date may extend beyond that date.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Performance
stock units</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company&rsquo;s board of directors has granted PSUs under the 2017 Plan to the Company&rsquo;s directors. The awards represent
the right to receive shares of the Company&rsquo;s common stock upon vesting of the PSU based on targets approved by the Company&rsquo;s
board of directors related to the Company&rsquo;s fully diluted market capitalization. The PSUs vest at various fully diluted
market capitalization levels with full vesting occurring upon the later of one year from the grant date and the Company achieving
a fully diluted market capitalization of at least $500 million for five consecutive business days. The PSUs expire on July 7,
2022.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth the PSUs outstanding under the 2017 Plan as of June 30, 2018:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number&nbsp;of <BR> PSUs <BR> outstanding</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2016 and 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 88%; text-indent: -10pt; padding-left: 10pt">Granted</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">140,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Forfeited</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(20,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">120,000</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has recognized $48,624 (2017 &ndash; $0) in expense related to the PSUs during the year ended June 30, 2018 with all of
it being recognized as general and administrative expense. As at June 30, 2018 there was $526,140 (2017 &ndash; $0) in unrecognized
compensation expense that will be recognized over the next 3.24&nbsp;years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
PSUs have been valued using the following assumptions:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 82%; text-align: left; text-indent: -10pt; padding-left: 10pt">Dividend rate</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Volatility</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">79.0 to 82.5</FONT></TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Risk-free rate</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">2.56% to 2.71</FONT></TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Term <B>&ndash;</B> years</FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1.67 to 3.24</FONT></TD><TD STYLE="text-align: left"></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stock
options</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table sets forth the aggregate stock options outstanding under all plans as of June 30, 2018:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> stock <BR> options <BR> outstanding</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted <BR> average <BR> exercise <BR> price</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2016</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">85,625</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">37.77</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Granted</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">26,460</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">48.22</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">112,085</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41.81</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">152,698</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11.35</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Forfeited</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(2,100</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">21.10</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">262,683</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">24.27</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table summarizes stock options currently outstanding and exercisable under all plans at June 30, 2018:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-weight: bold; border-bottom: Black 1.5pt solid; text-align: center">Exercise price <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number <BR> Outstanding at <BR> June 30, <BR> 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted <BR> average
    remaining <BR> contractual life <BR> (years)</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number <BR> exercisable at <BR> June 30, <BR> 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; text-align: center">&nbsp;</TD><TD STYLE="width: 23%; text-align: center">7.00</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; text-align: right">5,451</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; text-align: right">9.98</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 22%; text-align: right">&mdash;</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">8.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.34</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">9.80</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">83,647</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.89</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">10.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,600</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">9.79</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">11.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.66</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">15.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.92</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">20.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,125</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.27</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,125</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">21.10</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,900</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.26</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,300</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">29.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">32.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">0.92</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">37.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.61</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,499</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">40.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1.25</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,250</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">41.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8.36</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,111</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">42.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.56</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41,250</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">44.80</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.61</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,250</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">49.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">22,460</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.07</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,182</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">53.20</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7.85</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,556</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: center">&nbsp;</TD><TD STYLE="text-align: center">61.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4.75</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">1,500</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: center">92.00</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">3,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: right">4.92</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">3,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 4pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: center">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">262,683</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: right">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">124,523</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Included
in the number of stock options outstanding are 2,500 stock options granted at an exercise price of CA $20.00. The exercise prices
for these stock options shown in the above table have been converted to $15.50 US$ using the period ending closing exchange rate.
Certain stock options have been granted to non-employees and will be revalued at each reporting date until they have fully vested.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
stock options have been valued using a Black-Scholes pricing model using the following assumptions:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2017</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Dividend rate</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">%</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">0</TD><TD STYLE="width: 1%; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Volatility</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">72.4&nbsp;to&nbsp;87.1</FONT></TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">77.5%&nbsp;to&nbsp;88.7</FONT></TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Risk-free rate</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1.49%&nbsp;to&nbsp;2.86</FONT></TD><TD STYLE="text-align: left">%</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">1.00%&nbsp;to&nbsp;1.74</FONT></TD><TD STYLE="text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Term <B>&ndash;</B> years</FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">0.6&nbsp;to&nbsp;3.03</FONT></TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3.0</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company has recognized the following amounts as stock option expense for the periods noted:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Years ended June 30,</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2018<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">2017<BR>
$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Research and development</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">140,870</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">77,706</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">General and administrative</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">355,055</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">47,041</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">495,925</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">124,747</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">All
of the stock option expense of $495,925 (2017 <B>&ndash;</B> $124,747) for the years ended June 30, 2018 and 2017 has been recognized
as additional paid in capital. The aggregate intrinsic value of stock options outstanding at June 30, 2018 was $0 (2017 <B>&ndash;
</B>$56,783) and the aggregate intrinsic value of stock options exercisable at June 30, 2018 was $0 (2017 <B>&ndash;</B> $56,783).
As at June 30, 2018 there was $527,271 in unrecognized compensation expense that will be recognized over the next 2.9 years. No
stock options granted under the Plan have been exercised to June 30 2018. Upon the exercise of stock options new shares will be
issued.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">A
summary of the status of the Company&rsquo;s unvested stock options as at June 30, 2018 under all plans is presented below:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> options</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted <BR> average <BR> exercise <BR> price <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Weighted <BR> average <BR> grant date <BR> fair value <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 64%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Unvested at June 30, 2016</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">14,102</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">31.71</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">17.25</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">26,460</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">48.22</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">26.11</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Vested</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(8,759</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">46.81</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">24.83</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Unvested at June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">31,803</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">48.09</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25.74</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Granted</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">152,698</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11.35</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6.01</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Vested</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(44,241</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">27.81</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15.02</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Forfeited</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(2,100</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">21.10</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">11.32</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Unvested at June 30, 2018</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">138,160</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">14.39</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">7.63</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
aggregate intrinsic value of unvested stock options at June 30, 2018 was $0 (2017 <B>&ndash;</B> $0). The unvested stock options
have a remaining weighted average contractual term of 8.81 (2017 &ndash; 9.35) years.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Stock
option modifications</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the year ended June 30, 2018, certain stock options were modified pursuant to a separation agreement with the Company&rsquo;s
former President and Chief Operating Officer. A total of 6,760 options had their vesting accelerated such that they became fully
vested on December 22, 2017, resulting in additional stock option expense of $93,777. In addition, a total of 21,860 options were
modified such that their remaining exercise period was increased from one year to three years, resulting in additional stock option
expense of $28,561.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Also,
during the year ended June 30, 2018, certain stock options were modified pursuant to the resignation of the Company&rsquo;s former
Chairman. A total of 1,500 options had their vesting accelerated such that they became fully vested on June 2, 2018, resulting
in additional stock option expense of $679. In addition, a total of 4,500 (including the 1,500 whose vesting was accelerated)
options were modified such that their remaining exercise period was increased from 90 days to one year, resulting in additional
stock option expense of $2,182.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><U>Stock
option liability</U></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Certain
of the Company&rsquo;s stock options have been issued in CA$. Of these, a portion was classified as a stock option liability which
was revalued at each reporting date. During the year ended June 30, 2017, the Company amended 4,375 of these stock options held
by five optionees such that the exercise price of the options was adjusted to be denominated in US$. No other terms of the stock
options were amended. As a result of the amendment, the Company recognized $85,094 in stock option liability expense and $260,969
was reclassified to equity during the year ended June 30, 2017.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Warrants</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number of <BR> warrants</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Amount <BR> $</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2016</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">152,171</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">1,658,382</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issuance of 2017 Investor Warrants<SUP>(i)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">207,693</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">2,526,336</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issuance of 2017 Agent Warrants<SUP>(i)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,846</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">424,401</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Exercise of Valent Warrants<SUP>(ii)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(12,500</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(89,432</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Exercise of 2015 Investor Warrants<SUP>(iii)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(4,875</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(30,715</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Warrants issued for services<SUP>(iv)</SUP></FONT></TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">4,140</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">81,602</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2017</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">360,475</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,570,574</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Issuance of 2018 Investor and 2018 Agent Warrants<SUP>(v)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">840,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">3,572,843</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Exercise of 2018 Investor Warrants<SUP>(v)</SUP></FONT></TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(25,000</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(106,335</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Warrants issued for services<SUP>(iv)</SUP></FONT></TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">42,000</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">192,400</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-weight: bold; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">1,217,475</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">8,229,482</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">i)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
part of the financing completed by the Company on April 12, 2017, the Company issued the 2017 Investor Warrants and the 2017 Agent
Warrants. The 2017 Investor Warrants are exercisable at $35.00 until April 19, 2022 and the 2017 Agent Warrants are exercisable
at $40.60 until April 12, 2022.</FONT></TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">ii)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Valent warrants were exercised at $15.40 (CA$20.00) for proceeds of $192,075.</FONT></TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">iii)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
2015 Investor Warrants are exercisable at a price of $30.00. The warrants expire on July 31, 2020. During the year ended June
30, 2018, nil (2017 <B>&ndash;</B> 4,875) warrants were exercised for proceeds of $0 (2017 <B>&ndash;</B> $146,250).</FONT></TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">iv)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Warrants
issued for services are exercisable at various prices and expire at the various dates noted in the table below.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">v)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">As
part of the financing completed by the Company on September 22, 2017, the Company issued the 2018 Investor Warrants and the 2018
Agent Warrants. The 2018 Investor Warrants are exercisable at $12.50 until September 22, 2022 and the 2018 Agent Warrants are
exercisable at $12.50 until September 20, 2022.</FONT></TD>
</TR></TABLE>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>5</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Stockholders&rsquo;
equity (deficiency) </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Certain
of the Company&rsquo;s warrants have been recognized as a derivative liability (note 4).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following table summarizes the changes in the Company&rsquo;s outstanding warrants as of June 30, 2018:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Description</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 88%; font-weight: bold; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2017</TD><TD STYLE="width: 1%; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-weight: bold; text-align: right">662,891</TD><TD STYLE="width: 1%; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issuance of 2018 Investor Warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">800,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Exercise of 2018 Investor Warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(25,000</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issuance of 2018 Agent Warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Warrants issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">42,000</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Expiry of dividend warrants</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(81,250</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Expiry of 2013 Investor Warrants</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(10,513</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-weight: bold; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Balance &ndash; June 30, 2018</TD><TD STYLE="font-weight: bold; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; font-weight: bold; text-align: right">1,428,128</TD><TD STYLE="padding-bottom: 4pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following table summarizes the Company&rsquo;s outstanding warrants as of June 30, 2018:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Description</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Number</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Exercise <BR> price <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Expiry date</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 45%; text-indent: -10pt; padding-left: 10pt">2018 Investor</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">775,000</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">12.50</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 30%; text-align: center">September 22, 2022</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">2017 Investor</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">207,693</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">35.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">April 19, 2022</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">2015 Investor</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">97,900</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">July 31, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">2013 Investor &ndash; Amended</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">77,850</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">31.40</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">March 31, 2019</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">2013 Placement Agent</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">126,250</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">31.40</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">June 30, 2019</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">26,500</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">30.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">July 31, 2020 to February 1, 2021</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">6,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17.80</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">January 25, 2023</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">36,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">11.70</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">February 27, 2023</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,375</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">70.40</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">September 12, 2018</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Issued for services</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">4,140</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">59.30</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">February 27, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">2018 Agent</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40,000</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">12.50</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">September 20, 2022</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">2017 Agent</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">13,846</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40.60</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">April 12, 2022</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">2016 Agent</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,397</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">40.00</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: center">May 12, 2021 to June 8, 2021</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">2015 Agent</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,177</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: right">30.00</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="text-align: center; padding-bottom: 1.5pt">July 15, 2020</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 4pt double; font-weight: bold; text-align: right">1,428,128</TD><TD STYLE="padding-bottom: 4pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt; text-align: right">20.80</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="padding-bottom: 4pt">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>6</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Related
party transactions</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the year ended June 30, 2018, the Company recognized a total expense of $311,683 relating to the settlement agreement with the
Company&rsquo;s former President and Chief Operating Officer. Amounts owed to related parties, including to the Company&rsquo;s
former President and Chief Operating Officer, are non-interest bearing and payable on demand.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>7</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Current
and deferred income taxes</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">For
the years ended June 30, 2018, and 2017, the Company did not record a provision for income taxes due to a full valuation allowance
against our deferred tax assets.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Significant
components of the Company&rsquo;s future tax assets and deferred tax liabilities are shown below:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2017 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Deferred tax assets:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Non-capital losses carried forward</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">9,416,047</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">7,340,286</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Capital losses carried forward</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,925</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">17,925</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Financing costs</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,512</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">5,512</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Scientific research and development</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">396,758</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">350,435</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Scientific research and development &ndash; ITC</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">354,411</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">319,528</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,190,653</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">8,033,686</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Deferred tax liabilities:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Scientific research and development &ndash; ITC</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(61,230</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(53,841</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">10,129,423</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">7,979,845</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Valuation allowance</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(10,129,423</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">(7,979,845</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Net future tax assets</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
income tax benefit of these tax attributes has not been recorded in these consolidated financial statements because of the uncertainty
of their recovery. The Company&rsquo;s effective income tax rate differs from the statutory income tax rate of 21% (2017 <B>&ndash;
</B>34%).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
differences arise from the following items:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2017 <BR> $</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Tax recovery at statutory income tax rates</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(3,063,036</TD><TD STYLE="width: 1%; text-align: left">)</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">(2,747,800</TD><TD STYLE="width: 1%; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Permanent differences</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">290,722</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(15,342</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Effect of rate differentials between jurisdictions</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">76,364</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">464,938</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Impact of changes in income tax rates</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">138,516</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Scientific research and development &ndash; ITC</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(354,411</TD><TD STYLE="text-align: left">)</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&mdash;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Other</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">75,422</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">(62,962</TD><TD STYLE="text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Change in valuation allowance</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,836,423</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">2,361,166</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD>&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">&mdash;</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">As
of June 30, 2018, the Company had combined US and Canadian net operating loss carryforwards of $34.7 million that begin expiring
in 2029. In addition, the Company has non-refundable Canadian federal investment tax credits of $226,778 that expire between 2029
and 2038 and non-refundable British Columbia investment tax credits of $127,633 that expire between 2019 and 2028.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>7</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Current
and deferred income taxes </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Tax Cuts and Jobs Act (&ldquo;2017 Tax Act&rdquo;) was enacted in December 2017. The 2017 Tax Act, among other things, reduces
the U.S. federal corporate tax rate from 35% to 21%, effective January 1, 2018, requires companies to pay a one-time transition
tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign earnings.
The Company revalued our deferred tax assets as of June 30, 2018 based on a U.S. federal tax rate of 21%, which resulted in a
reduction to our deferred tax assets of $138,516 fully offset by a reduction to the valuation allowance. The Company is not required
to pay a one-time transition tax on earnings of our foreign subsidiary as the foreign subsidiary has an accumulated deficit.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>8</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Commitments
and contingencies</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has the following obligations over the next five fiscal years ending June 30, 2023:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>Clinical
development</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company has entered into contracts for drug manufacturing and clinical study management related to its Phase III clinical trial
for a total of $654,829. While this trial has now been parked, certain costs related to the parking of this trial as well as manufacturing
costs related to drug supply have been committed to by the Company. Pursuant to the commitment for clinical trial management,
the Company has paid a total of $921,027 in deposits related to study initiation and certain study costs. These deposits are available
to be applied against invoices received from the contract research organization but have not been netted against the Company&rsquo;s
commitments for the fiscal year ended June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Office
lease</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company currently rents its offices on a month-to-month basis at a rate of $4,708 (CA$6,200) per month. During the year ended
June 30, 2018, the Company recorded $58,434 as rent expense (2017 &ndash; $35,908).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>9</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Supplementary
statement of cash flows information</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 75%; font: 10pt Times New Roman, Times, Serif; padding-top: 10pt; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-top: 10pt; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 11%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Year
    ended <BR>
    June 30, <BR>
    2018</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif; padding-bottom: 1.5pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 12%; font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1.5pt solid"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Year
    ended <BR>
    June 30, <BR>
    2017</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Series
    B Preferred Stock common stock dividend (note 5)</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">176,236</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">790,454</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Non-cash
    issue costs (note 5)</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">148,087</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">424,401</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Reclassification
    of derivative liability to equity upon the exercise of warrants (note 4)</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">248,409</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Reclassification
    of derivative liability to equity upon the amendment of warrants&nbsp;(note 4)</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">53,006</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Reclassification
    of stock option liability to equity upon settlement (note 5)</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">260,969</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Conversion
    of Series B Preferred Stock to common stock (note 5)</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">147,375</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Income
    taxes paid</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="padding-left: 10pt; text-indent: -10pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Interest
    paid</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&mdash;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>10</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Financial
risk management</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Market
risk</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Market
risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the
Company&rsquo;s income or valuation of its financial instruments.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company is exposed to financial risk related to fluctuation of foreign exchange rates. Foreign currency risk is limited to the
portion of the Company&rsquo;s business transactions denominated in currencies other than the United Sates dollar, primarily general
and administrative expenses incurred in Canadian dollars. The Company believes that the results of operations, financial position
and cash flows would be affected by a sudden change in foreign exchange rates, but would not impair or enhance its ability to
pay its Canadian dollar accounts payable. The Company manages foreign exchange risk by converting its US$ to CA$ as needed. The
Company maintains the majority of its cash in US$. As at June 30, 2018, Canadian dollar denominated accounts payable and accrued
liabilities exposure in US$ totaled $106,132.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">a)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Foreign
exchange risk</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: 0">Foreign exchange risk is the risk that the fair value or future cash flows of a financial&nbsp;instrument will fluctuate
because of changes in foreign exchange rates. If foreign exchange rates were to fluctuate within +/-10% of the closing rate at
year-end, the maximum exposure is $6,788.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Balances
in foreign currencies at June 30, 2018 and 2017 are as follows:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2018 <BR> balances <BR> CA$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD><TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">June 30, <BR> 2017 <BR> balances <BR> CA$</TD><TD STYLE="padding-bottom: 1.5pt; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 76%; text-align: left; text-indent: -10pt; padding-left: 10pt">Trade payables</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">79,858</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; text-align: right">164,226</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-indent: -10pt; padding-left: 10pt">Cash</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">41,459</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">39,251</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Interest, taxes, and other receivables</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">14,618</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">99,397</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 24pt"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">b)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Interest
rate risk</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
Company is subject to interest rate risk on its cash and cash equivalents and believes that the results of operations, financial
position and cash flows would not be significantly affected by a sudden change in market interest rates relative to the investment
interest rates due to the short-term nature of the investments. As at June 30, 2018, cash and cash equivalents held in by the
Company was $5,971,995. The Company&rsquo;s cash balance currently earns interest at standard bank rates. If interest rates were
to fluctuate within +/-10% of the closing rate at year end the impact of the Company&rsquo;s interest-bearing accounts will be
not be significant due to the current low market interest rates.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
only financial instruments that expose the Company to interest rate risk are its cash and cash equivalents.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Liquidity
risk</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Liquidity
risk is the risk that the Company will encounter difficulty in raising funds to meet cash flow requirements associated with financial
instruments. The Company continues to manage its liquidity risk based on the outflows experienced for the period ended June 30,
2018 and is undertaking efforts to conserve cash resources wherever possible. The maximum exposure of the Company&rsquo;s liquidity
risk is $1,638,515 as at June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>10</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Financial
risk management </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Credit
risk</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Credit
risk arises from cash and cash equivalents, deposits with banks, financial institutions, and contractors as well as outstanding
receivables. The Company limits its exposure to credit risk, with respect to cash and cash equivalents, by placing them with high
quality credit financial institutions. The Company&rsquo;s cash equivalents consist primarily of operating funds with commercial
banks. Of the amounts with financial institutions on deposit, the following table summarizes the amounts at risk should the financial
institutions with which the deposits are held cease trading:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
maximum exposure of the Company&rsquo;s credit risk is $39,519 at June 30, 2018 relating to interest, taxes, and other receivables.
The credit risk related to uninsured cash and cash equivalents balances is $5,868,825 at June 30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 63%; padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 11%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Cash
    and <BR>
    cash <BR>
    equivalents <BR>
    $</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 11%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Insured
    <BR>
    amount <BR>
    $</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding-bottom: 1.5pt; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 12%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Non-insured
    <BR>
    amount <BR>
    $</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">5,971,995</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">103,170</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">5,868,825</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Concentration
of credit risk</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Financial
instruments that subject the Company to credit risk consist primarily of cash and cash equivalents.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
Company places its cash and cash equivalents in accredited financial institutions and therefore the Company&rsquo;s management
believes these funds are subject to minimal credit risk. The Company has no significant off-balance sheet concentrations of credit
risk such as foreign currency exchange contracts, option contracts or other hedging arrangements.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>11</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Subsequent
events</B></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Reverse
Stock Split</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 7, 2019, the Company filed a Certificate of Change with the Secretary of State of Nevada that effected a 1-for-10 (1:10) reverse
stock split of its common stock, par value $0.001 per share, which became effective on May 8, 2019. Pursuant to the Certificate
of Change, the Company&rsquo;s authorized common stock was decreased in the same proportion as the split resulting in a decrease
from 70,000,000 authorized shares of common stock to 7,000,000 shares authorized. The par value of its common stock was unchanged
at $0.001 per share, post-split. All common shares, warrants, stock options, conversion ratios, and per share information in these
consolidated financial statements give retroactive effect to the 1-for-10 reverse stock split. The Company&rsquo;s authorized
and issued preferred stock was not affected by the split.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U STYLE="text-decoration: none">&nbsp;</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B><U>Rights
Offering</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Subsequent
to June 30, 2018, the Company filed a registration statement relating to a rights offering for a maximum gross proceeds of $8.0
million. For every common share of stock owned (including each share of common stock issuable upon exercise of certain outstanding
warrants) as of the record date, the stockholder will receive one basic subscription right, which gives the stockholder the opportunity
to purchase one unit, consisting of one share of the Company&rsquo;s Series C Preferred Stock and 0.50 warrants, for a price of
$1,000 per Unit. The raising of any funds will not be assured until the closing of the offering which is expected to be in the
first week of June 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>DelMar
    Pharmaceuticals, Inc.<BR>
    </B>Notes to Consolidated Financial Statements<BR>
    <B>June 30, 2018</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(in
US dollars unless otherwise noted)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0%"></TD><TD STYLE="width: 24pt; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>11</B></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Subsequent
events </B>(cont.)</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>Performance
Stock Units</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">On
April 30, 2019 the Company&rsquo;s Board of Directors approved the cancellation of all 120,000 PSU&rsquo;s outstanding at June
30, 2018.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><U>2017
Omnibus Plan</U></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
April 30, 2019 the Company&rsquo;s Board of Directors also approved a temporary reduction in the reserve under the Company&rsquo;s
2017 Plan. As a result, the 367,317 shares of common stock available for issuance under the 2017 Plan as of March 31, 2019 was
reduced to 14,217. If the Company&rsquo;s authorized common shares are increased at the 2019 annual meeting of stockholders, the
reserve will be increased back to 367,317.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 14pt"><B>760,500
Shares of Common Stock</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 14pt"><B>Issuable
upon Exercise of Outstanding Warrants</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><IMG SRC="img_001.jpg" ALT="" STYLE="width: 272px; height: 71px"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: 24pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 14pt"><B>PROSPECTUS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 100%; padding-top: 0pt; text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;,
    2019</FONT></TD></TR>
</TABLE>

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<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>PART
II</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>INFORMATION
NOT REQUIRED IN PROSPECTUS</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Item
13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other Expenses of Issuance and Distribution</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">The
following is a statement of estimated expenses in connection with the issuance and distribution of the securities being registered.
All expenses incurred with respect to the registration of the common stock will be borne by us. All amounts are estimates except
the SEC registration fee.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-weight: bold; border-bottom: Black 1.5pt solid">Item</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-weight: bold; text-align: center; border-bottom: Black 1.5pt solid">Amount to be <BR> Paid</TD><TD STYLE="font-weight: bold; padding-bottom: 1.5pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 88%; text-align: left; text-indent: -10pt; padding-left: 10pt">SEC registration fee</TD><TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; text-align: left">$</TD><TD STYLE="width: 9%; text-align: right">141.95</TD><TD STYLE="width: 1%; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Legal fees and expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">25,000.00</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -10pt; padding-left: 10pt">Accounting fees and expenses</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">15,000.00</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="text-align: left; padding-bottom: 1.5pt; text-indent: -10pt; padding-left: 10pt">Miscellaneous expenses</TD><TD STYLE="padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1.5pt solid; text-align: right">858.05</TD><TD STYLE="padding-bottom: 1.5pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-style: italic; padding-bottom: 4pt; text-indent: -10pt; padding-left: 10pt">Total</TD><TD STYLE="padding-bottom: 4pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 4pt double; text-align: left">$</TD><TD STYLE="border-bottom: Black 4pt double; text-align: right">41,000.00</TD><TD STYLE="padding-bottom: 4pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Item
14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Indemnification of Directors and Officers</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Neither
our Articles of Incorporation or our Bylaws prevent us from indemnifying our officers, directors and agents to the extent permitted
under the Nevada Revised Statute (&ldquo;NRS&rdquo;). NRS Section 78.7502 provides that a corporation shall indemnify any director,
officer, employee or agent of a corporation against expenses, including attorneys&rsquo; fees, actually and reasonably incurred
by him in connection with any the defense to the extent that a director, officer, employee or agent of a corporation has been
successful on the merits or otherwise in defense of any action, suit or proceeding referred to Section 78.7502(1) or 78.7502(2),
or in defense of any claim, issue or matter therein.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">NRS
Section 78.7502(1) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys&rsquo; fees,
judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or
proceeding if he: (a) is not liable pursuant to NRS Section 78.138; or (b) acted in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">NRS
Section 78.7502(2) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor,
by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust
or other enterprise against expenses, including amounts paid in settlement and attorneys&rsquo; fees actually and reasonably incurred
by him in connection with the defense or settlement of the action or suit if he: (a) is not liable pursuant to NRS Section 78.138;
or (b) acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation.
Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals there from, to be liable to the corporation or for amounts paid in settlement to
the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent
jurisdiction determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably
entitled to indemnity for such expenses as the court deems proper.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">NRS
Section 78.747 provides that except as otherwise provided by specific statute, no stockholder, director or officer of a corporation
is individually liable for a debt or liability of the corporation, unless the director or officer acts as the alter ego of the
corporation. The court as a matter of law must determine the question of whether a director or officer acts as the alter ego of
a corporation.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Insofar
as indemnification for liabilities arising under the Securities Act of 1933, as amended (the &ldquo;Securities Act&rdquo;), may
be permitted to directors, officers or controlling persons of ours, pursuant to the foregoing provisions, or otherwise, we have
been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act
and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such a director, officer or controlling person in connection with the
securities being registered, 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 such indemnification by us is against public policy as expressed
hereby in the Securities Act and we will be governed by the final adjudication of such issue.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Item
15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Recent Sales of Unregistered Securities.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
May 8, 2019, we effected a one-for-ten reverse stock split (the &ldquo;Reverse Stock Split&rdquo;) of our issued and outstanding
and authorized common stock. All per share amounts and number of shares of common stock, in this Item 15 reflect the Reverse Stock
Split. The Reverse Stock Split does not affect the our authorized preferred stock of 5,000,000 shares; except that, pursuant to
the terms of the Certificate of Designations of Series B Convertible Preferred Stock for the issued and outstanding shares of
our Series B Convertible Preferred Stock, par value $0.001 per share (the &ldquo;Series B Preferred Stock&rdquo;), the conversion
price at which shares of Series B Preferred Stock may be converted into shares of common stock will be proportionately adjusted
to reflect the Reverse Stock Split.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Investment
Warrants</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
June 5, 2019, we completed a registered direct offering (the &ldquo;RD Offering&rdquo;) with certain institutional investors of
an aggregate of 1,170,000 shares of common stock and, in a concurrent private placement, warrants to purchase 760,500 shares of
common stock at a combined purchase price of $3.10 per share and related warrant. The warrants have an exercise price of $3.10
per share, are immediately exercisable and have a term of exercise of five years. The gross proceeds from the offering, prior
to deducting offering expenses and placement agent fees and expenses payable by us, were $3.6 million. We issued additional warrants
to purchase 46,800 shares of common stock at an exercise price of $3.875 pursuant a placement agency agreement by and among us,
Maxim Group LLC and Dawson James Securities, Inc. for services provided in connection with the RD Offering.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
November 25, 2018 we issued an aggregate of 99,167 shares of common stock in exchange for 297,500 exchanged warrants, pursuant
to Warrant Exercise and Exchange Agreements, dated as of November 25, 2018 with certain institutional investors.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
September 20, 2017, we issued warrants to purchase 800,000 shares of common stock at an exercise price equal to $12.50 per whole
share of common stock, pursuant to a securities purchase agreement with certain institutional investors, and we issued additional
warrants to purchase 40,000 shares of common stock at an exercise price equal to $12.50 pursuant an engagement letter by and between
us and H.C. Wainwright &amp; Co, LLC for services provided in connection with a securities offering of common stock and warrants.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">On
April 12, 2017, we issued warrants to purchase 207,692 shares of common stock at an exercise price equal to $35.00 per whole share
of common stock, pursuant to a securities purchase agreement with certain institutional investors, and we issued additional warrants
to purchase 13,846 shares of common stock at an exercise price equal to $40.60 per whole share of common stock pursuant to an
engagement letter by and between us and Rodman &amp; Renshaw, a unit of H.C. Wainwright &amp; Co, LLC for services provided in
connection with a securities offering of common stock and warrants.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Series
B Preferred and Dividends</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">From
April 29, 2016 through June 8, 2016, we issued a total of 902,238 shares of our Series B Preferred Shares which are convertible
into 225,560 for gross proceeds of $7,217,904.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the three-year period ended June 30, 2018, we issued 42,921 shares of common stock as dividends on our outstanding shares of Series
B Preferred Stock.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Exchangeable
Shares</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, 15,125 shares of common stock upon exchange of Exchangeable Shares of 0959456 B.C.
Ltd., a British Columbia corporation, and our subsidiary.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Warrant
Exercises</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the three-year period ended June 30, 2018, we issued 20,960 shares of common stock upon exercise of warrants at an exercise price
of $31.40.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, we issued 9,110 shares of common stock upon exercise of warrants at an exercise price
of $30.00.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the three-year period ended June 30, 2018, we issued 62 shares of common stock upon the cashless exercise of 103 warrants with
an exercise price of $30.00.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, we issued 12,500 shares of common stock upon exercise of warrants at an exercise price
of $15.40.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><I>Compensatory
Issuances</I></B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, we issued 9,613 shares of common stock in relation to services received by us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, we granted options pursuant to our 2017 Omnibus Incentive Plan to purchase 92,698 shares
of our common stock at an exercise price of $9.70 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">During
the three-year period ended June 30, 2018, we granted 140,000 performance stock units pursuant to our 2017 Omnibus</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Incentive Plan.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, we granted options pursuant to our Amended and Restated 2003 Employee Stock Option
Plan to purchase 230,448 shares of our common stock at an exercise price of $14.20 per share.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">During
the three-year period ended June 30, 2018, we issued warrants to purchase an aggregate of 72,640 shares of our common stock at
an exercise price of $21.60 for service to be rendered by consultants to us.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Except
as indicated above, in connection with the issuance of the above unregistered securities we relied on the exemption from registration
afforded by Section 4(a)(2) and Regulation D (Rule 506) of the Securities Act of 1933, as amended, based on representations to
the Company made by the Exercising Holders that they are &ldquo;accredited investors&rdquo; as such term is defined under Regulation
D of the Securities Act. Until registered, the Exchange Shares are restricted and may not be offered or sold in the United States
absent registration or availability of an applicable exemption from registration.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Item
16.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Exhibits and Financial Statement Schedules.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>&nbsp;</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><I>(a)
Exhibits</I></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
following exhibits are being filed with this Registration Statement:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">

<FONT STYLE="font: 10pt Times New Roman, Times, Serif"></FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 9%; border-bottom: black 1.5pt solid; padding-right: 3pt; padding-bottom: 1.5pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Exhibit&nbsp;No.</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; padding-bottom: 1.5pt">&nbsp;</TD>
    <TD STYLE="width: 90%; border-bottom: black 1.5pt solid; text-align: center"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>Description of Exhibit</B></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.1</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000112785510000330/berryonlyexh3_1.htm">Articles of Incorporation of the Company (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Registration Statement on Form S-1 filed with the SEC on August 17, 2010)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.2</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000116552713000095/ex3-1b.htm">Articles of Merger of the Company (incorporated by reference to Exhibit 3.1(b) of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 23, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.3</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000116552713000095/ex3-1a.htm">Certificate of Designation of Special Voting Preferred Stock of the Company (incorporated by reference to Exhibit 3.1(a) of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 23, 2013)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.4</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000112785510000330/berryonlyexh3_2.htm">Bylaws of the Company (incorporated by reference to Exhibit 3.2 of the Company&rsquo;s Registration Statement on Form S-1 filed with the SEC on August 17, 2010)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.5</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000238/ex31.htm">Amendment to Bylaws of the Company (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on February 14, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.6</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376214001148/ex31.htm">Certificate of Designation of Series A Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on October 3, 2014)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.7</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000116552713000025/ex3-1.txt">Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 7, 2013)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.8</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376216001629/f8k051616ex3i_delmarpharm.htm">Certificate of Change (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 20, 2016)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.9</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376216001547/f8k042916ex3i_delmapharm.htm">Certificate of Designation of Series B Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 5, 2016)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.10</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390018004436/f8k041118ex3-1_delmarpharm.htm">The Certificate of Amendment to the Articles of Incorporation, as amended, of DelMar Pharmaceuticals Inc., dated April 11, 2018 (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 13, 2018)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.11</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019010452/posam2019ex3-11_delmar.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Form of Certificate of Designation of Preference, Rights and Limitations of Series C Convertible Preferred Stock (incorporated by reference to Exhibit 3.11 of the Company&rsquo;s Post-Effective Amendment to the Registration Statement on Form S-1 filed with the SEC on June 10, 2019)</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.12</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019006573/f8k041719ex3-1_delmarpharma.htm">Certificate of Correction to the Company&rsquo;s articles of incorporation, filed with the Secretary of State of the State of Nevada on April 17, 2019 (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 17, 2019)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">3.13</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019007995/f8k050719ex3-1_delmar.htm">Certificate of Change of DelMar Pharmaceuticals, Inc., dated May 7, 2019 and effective May 8, 2019 (incorporated by reference to Exhibit 3.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 8, 2019)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.1</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000116552712000979/ex4.txt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Specimen Common Stock Certificate, $.001 par value (incorporated by reference to Exhibit 4 of the Company&rsquo;s Registration Statement on Form 8-A filed with the SEC on September 14, 2012) </FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.2</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215000701/fs12015a9ex4i_delmarpharma.htm">Form of Warrant (incorporated by reference to Exhibit 4.1 of the Company&rsquo;s Registration Statement on Form S-1/A filed with the SEC on July 9, 2015)</A> </FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.3</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000147/ex106.htm">Form of Investor Warrant (incorporated by reference to Exhibit 10.6 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 31, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.4</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000147/ex107.htm">Form of Dividend Warrant (incorporated by reference to Exhibit 10.7 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 31, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.5</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376214000690/ex991.htm">Form of Election to Exercise Warrants (incorporated by reference to Exhibit 99.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on June 9, 2014)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.6</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376214001287/f8k110614ex10i_delmarpharma.htm">Form of Investor Warrant Amendment (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on November 6, 2014)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.7</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376214001287/f8k110614ex10ii_delmarpharma.htm">Form of Dividend Warrant Amendment (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on November 6, 2014)</A></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="width: 9%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.8</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; width: 1%">&nbsp;</TD>
    <TD STYLE="width: 90%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215001212/f8k123015ex10i_delmarpharma.htm">Form of Placement Agent Warrant Amendment (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on December 31, 2015)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.9</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376216001547/f8k042916ex10iii_delmarpharm.htm">Form of Placement Agent Warrant (incorporated by reference to Exhibit 10.3 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 5, 2016)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.10</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017003720/f8k0417ex4i_delmarpharma.htm">Form of Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 13, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.11</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017009876/f8k0917ex4-1_delmarpharma.htm">Form of Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on September 21, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.20</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019009520/fs12019a2ex4-21_delmar.htm">Form of Warrant Agreement (incorporated by reference to Exhibit 4.21 of the Company&rsquo;s Registration Statement on Form S-1/A filed with the SEC on May 23, 2019)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.21</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019010452/posam2019ex4-21_delmar.htm">Form of Warrant Certificate (incorporated by reference to Exhibit 4.21 of the Company&rsquo;s Post-Effective Amendment to the Registration Statement on Form S-1 filed with the SEC on June 10, 2019)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">4.22</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019010452/posam2019ex4-22_delmar.htm">Form of Non-Transferable Subscription Rights Certificate (incorporated by reference to Exhibit 4.22 of the Company&rsquo;s Post-Effective Amendment to the Registration Statement on Form S-1 filed with the SEC on June 10, 2019)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">5.1*</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="fs12019ex5-1_delmar.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Legal opinion of Fennemore Craig, P.C.</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.1</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215000714/fs12015a10ex1i_delmarpharma.htm">Form of Placement Agent Agreement (incorporated by reference to Exhibit 1.1 of the Company&rsquo;s Registration Statement on Form S-1/A filed with the SEC on July 15, 2015)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.2</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000147/ex101.htm">Intercompany Funding Agreement, dated January 25, 2013, between the Company and Exchangeco (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 31, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.3</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000147/ex102.htm">Support Agreement, dated January 25, 2013, among the Company, Exchangeco and Callco (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 31, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.4</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000147/ex103.htm">Voting and Exchange Trust Agreement, dated January 25, 2013, among the Company, Callco, Exchangeco, and the Trustee (incorporated by reference to Exhibit 10.3 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 31, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.5&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000147/ex108.htm">Memorandum of Understanding and Collaboration Agreement between Guangxi Wuzhou Pharmaceutical (Group) Co. Ltd. and Del Mar (BC) (incorporated by reference to Exhibit 10.8 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 31, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.6&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000388/ex109.htm">Patent Assignment Agreement, dated September 12, 2010, between Del Mar (BC) and Valent (incorporated by reference to Exhibit 10.9 of the Company&rsquo;s Current Report on Form 8-K/A filed with the SEC on March 14, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.7&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000388/ex1010.htm">Amendment, dated January 21, 2013, to Patent Assignment Agreement, dated September 12, 2010, between Del Mar (BC) and Valent (incorporated by reference to Exhibit 10.10 of the Company&rsquo;s Current Report on Form 8-K/A filed with the SEC on March 14, 2013)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.8</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215000014/f8k123114ex10i_delmarpharma.htm">Form of Exchange Agreement (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on January 7, 2015)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.9&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215000333/fs12015ex10xvi_delmarpharma.htm">Consulting Agreement, effective January 1, 2015 between Del Mar (BC) and Jeffrey Bacha (incorporated by reference to Exhibit 10.16 of the Company&rsquo;s Registration Statement on Form S-1 filed with the SEC on April 10, 2015)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.10&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215000333/fs12015ex10xvii_delmarpharma.htm">Consulting Agreement, effective January 1, 2015 between Del Mar (BC) and Dennis Brown (incorporated by reference to Exhibit 10.17 of the Company&rsquo;s Registration Statement on Form S-1 filed with the SEC on April 10, 2015)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.11&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376215000333/fs12015ex10xviii_delmarpharm.htm">Consulting Agreement, effective January 1, 2015 between Del Mar (BC) and Scott Praill (incorporated by reference to Exhibit 10.18 of the Company&rsquo;s Registration Statement on Form S-1 filed with the SEC on April 10, 2015)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.12</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376216001547/f8k042916ex10i_delmarpharm.htm">Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 5, 2016)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.13</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376216001547/f8k042916ex10ii_delmarpharm.htm">Form of Royalty Agreement (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 5, 2016)</A></FONT></TD></TR>

<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.14</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017003720/f8k0417ex10i_delmarpharma.htm">Form of Securities Purchase Agreement, dated April 12, 2017 (incorporated by reference to Exhibit&nbsp;10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 13, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.15</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017003720/f8k0417ex10ii_delmarpharma.htm">Engagement Letter Agreement, dated January 24, 2017 between DelMar Pharmaceuticals, Inc. and H.C. Wainwright &amp; Co., LLC (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 13, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.16</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017003720/f8k0417ex10iii_delmarpharma.htm">Amendment No. 1 to letter agreement between DelMar Pharmaceuticals, Inc. H.C. Wainwright &amp; Co., LLC (incorporated by reference to Exhibit 10.3 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 13, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.17</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017003720/f8k0417ex10iv_delmarpharma.htm">Amendment No. 2 to letter agreement between DelMar Pharmaceuticals, Inc. H.C. Wainwright &amp; Co., LLC (incorporated by reference to Exhibit 10.4 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on April 13, 2017)</A></FONT></TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="width: 11%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.18&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt; width: 1%">&nbsp;</TD>
    <TD STYLE="width: 88%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017001208/f10q1216ex10i_delmarpharma.htm">Employment agreement among Delmar Pharmaceuticals Inc., Delmar Pharmaceuticals (BC) Ltd. and Jeffrey Bacha (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on February 10, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.19&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017001208/f10q1216ex10ii_delmarpharma.htm">Employment agreement among Delmar Pharmaceuticals Inc., Delmar Pharmaceuticals (BC) Ltd. and Scott Praill (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on February 10, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.20&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017001208/f10q1216ex10iii_delmarpharma.htm">Amendment to consulting agreement between Delmar Pharmaceuticals (BC) Ltd. and Dennis Brown (incorporated by reference to Exhibit 10.3 of the Company&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on February 10, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.21&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390018001883/f10q1217ex10-4_delmarpharma.htm">2017 Omnibus Equity Incentive Plan (As Amended and Restated Effective as of February 1, 2018) (incorporated by reference to Exhibit 10.4 of the Company&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on February 14, 2018)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.22</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017007484/f8k070717ex10ii_delmarpharma.htm">Form of Performance Share Unit Award Agreement (incorporated by reference to Exhibit 99.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on July 12, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.23</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017009876/f8k0917ex10-2_delmarpharma.htm">Engagement Letter Agreement, dated September 17, 2017 between DelMar Pharmaceuticals, Inc. and H.C. Wainwright &amp; Co., LLC (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on September 21, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.24</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390018001883/f10q1217ex10-3_delmarpharma.htm">Form of Securities Purchase Agreement, dated September 20, 2017 (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on September 21, 2017)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.25&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390018001883/f10q1217ex10-3_delmarpharma.htm">Settlement Agreement, dated January 1, 2018, between Delmar Pharmaceuticals, Inc. and Jeffrey Bacha (incorporated by reference to Exhibit 10.3 of the Company&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on February 14, 2018</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.26&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390017011595/f8k110317ex10-1_delmarpharma.htm">Agreement, effective as of November 3, 2017 between the Company and Mr. Zarrabian (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on November 8, 2017</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.27&dagger;</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390018006694/f8k0518ex10-1_delmar.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Employment agreement, effective as of May 21, 2018 between the Company and Mr. Zarrabian (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on May 22, 2018, 2017</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.28</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019009963/f8k060319a1ex10-1_delmar.htm">Placement Agency Agreement, dated June 3, 2019, among the Company, Maxim Group LLC and Dawson James Securities, Inc. (incorporated by reference to Exhibit 10.1 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on June 3, 2019)</A></FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.29</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000121390019009963/f8k060319a1ex10-2_delmar.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Form of Purchase Agreement, dated as of June 3, 2019 among the Company and the purchasers thereunder (incorporated by reference to Exhibit 10.2 of the Company&rsquo;s Current Report on Form 8-K filed with the SEC on June 3, 2019)</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">21.1</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/1498382/000101376213000818/ex21.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Subsidiaries (incorporated by reference to Exhibit 21 of the Company&rsquo;s Registration Statement on Form S-1 filed with the SEC on June 14, 2013)</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">23.1*</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="fs12019ex23-1_delmar.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consent of Ernst &amp; Young, LLP</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">23.2*</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="fs12019ex5-1_delmar.htm"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Consent of Fennemore Craig, P.C. (included in Exhibit 5.1)</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">24.1*</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><A HREF="#PA"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Power of Attorney (included on the signature page of this registration statement)</FONT></A></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">EX-101.INS</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">XBRL Instance Document*</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">EX-101.SCH</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">XBRL Taxonomy Extension Schema Document*</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">EX-101.CAL</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">XBRL Taxonomy Extension Calculation Linkbase*</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">EX-101.DEF</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">XBRL Taxonomy Extension Definition Linkbase*</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">EX-101.LAB</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">XBRL Taxonomy Extension Labels Linkbase*</FONT></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">EX-101.PRE</FONT></TD>
    <TD STYLE="white-space: nowrap; padding-bottom: 2.25pt">&nbsp;</TD>
    <TD><FONT STYLE="font: 10pt Times New Roman, Times, Serif">XBRL Taxonomy Extension Presentation Linkbase*</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>



<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"></P>

<!-- Field: Rule-Page --><DIV ALIGN="LEFT" STYLE="margin-top: 0; margin-bottom: 0"><DIV STYLE="font-size: 1pt; border-top: Black 1.5pt solid; width: 25%">&nbsp;</DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&dagger;</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Indicates
management contract or compensatory plan.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"></FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">*</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Filed
herewith.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>(b)</I></FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><I>Financial
Statement Schedules</I></FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">All
schedules have been omitted because either they are not required, are not applicable or the information is otherwise set forth
in the financial statements and related notes thereto.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -48pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -48pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Item
17.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Undertakings</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(a)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">The
undersigned registrant hereby undertakes:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(1)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(i)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(ii)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Security and Exchange Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the &ldquo;Calculation of Registration Fee&rdquo; table in the effective registration statement;
and</FONT></TD>
</TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(iii)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement.</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(2)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">That,
for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(3)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at
the termination of the offering.</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 24pt; text-indent: -24pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(4)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">That,
for the purpose of determining liability under the Securities Act of 1933 to any purchaser:</FONT></TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 48pt; text-indent: -24pt"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(A)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the
date the filed prospectus was deemed part of and included in the registration statement; and</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(B)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Each
prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in
a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to
a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration
statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date
of first use.</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0; width: 100%"><TR STYLE="vertical-align: top; text-align: left">
<TD STYLE="width: 0"></TD><TD STYLE="width: 0.25in; text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(5)</FONT></TD><TD STYLE="text-align: left"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to any charter provision, by law or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than
payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue.</FONT></TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>SIGNATURES</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the requirements of the Securities Act of 1933, has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Vancouver, British Columbia, Canada, as of June 25, 2019.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">DELMAR PHARMACEUTICALS, INC.</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 60%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 36%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">By:</FONT></TD>
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/ Scott
    Praill</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Scott Praill</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief Financial Officer</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>KNOW
ALL MEN BY THESE PRESENTS</B>, that each person whose signature appears below constitutes and appoints Saiid Zarrabian and Scott
Praill, and each of them, each with full power to act without the other, his true and lawful attorneys-in-fact&nbsp;and agents,
each with full power of substitution and resubstitution, for such person and in his name, place and stead, in any and all capacities,
to sign any amendments to this registration statement, and to sign any registration statement for the same offering covered by
this registration statement, including post-effective&nbsp;amendments or registration statements filed pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, hereby ratifying and confirming that each of said such attorneys-in-fact&nbsp;and
agents or his substitute or substitutes, may do or cause to be done by virtue hereof.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><A NAME="PA"></A><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</FONT></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="width: 37%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Signature</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 41%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Title</B></FONT></TD>
    <TD STYLE="white-space: nowrap; width: 1%; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 20%; border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B>Date</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Saiid Zarrabian</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief&nbsp;Executive&nbsp;Officer&nbsp;and&nbsp;Director</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Saiid Zarrabian</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(Principal&nbsp;Executive&nbsp;Officer)</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Scott Praill</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Chief&nbsp;Financial&nbsp;Officer</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Scott Praill</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">(Principal&nbsp;Financial&nbsp;and&nbsp;Accounting&nbsp;Officer)</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    John K. Bell</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">John K. Bell</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Lynda Cranston</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Lynda Cranston</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Napoleone Ferrara</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Napoleone Ferrara</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Robert E. Hoffman</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert E. Hoffman</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="border-bottom: Black 1.5pt solid; font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">/s/
    Robert J. Toth</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Director</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">June
    25, 2019</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; font: 10pt Times New Roman, Times, Serif">
    <TD STYLE="text-align: center; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">Robert J. Toth</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="white-space: nowrap; font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif"><FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt">&nbsp;</FONT></TD></TR>
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[{"type": "S-1", "sequence": "1", "filename": "fs12019_delmarpharmaceutical.htm", "description": "REGISTRATION STATEMENT", "secsgml_size_bytes": 1890177}]
{"company-data": {"conformed-name": "DelMar Pharmaceuticals, Inc.", "cik": "0001498382", "assigned-sic": "2834", "irs-number": "990360497", "state-of-incorporation": "NV", "fiscal-year-end": "0630"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-232332", "film-number": "19918694"}, "business-address": {"street1": "SUITE 720-999 WEST BROADWAY", "city": "VANCOUVER", "state": "A1", "zip": "V5Z 1K5", "phone": "(604) 629-5989"}, "mail-address": {"street1": "SUITE 720-999 WEST BROADWAY", "city": "VANCOUVER", "state": "A1", "zip": "V5Z 1K5"}, "former-company": {"former-conformed-name": "Berry Only Inc.", "date-changed": "20100805"}}
As filed with the Securities and Exchange
Commission on June 25, 2019
Registration No.
UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
DelMar
Pharmaceuticals, Inc.
(Exact
name of registrant as specified in its charter)
Nevada
2834
99-0360497
(State
    or other jurisdiction of
incorporation or organization)
(Primary
    Standard Industrial
Classification Code Number)
(I.R.S.
    Employer
Identification Number)
Suite
720-999 West Broadway
Vancouver, British Columbia, Canada V5Z 1K5
(604) 629-5989
(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)
Saiid
Zarrabian
President and Chief Executive Officer
DelMar Pharmaceuticals, Inc.
Suite 720-999 West Broadway
Vancouver, British Columbia, Canada V5Z 1K5
(604) 629-5989
(Name,
address, including zip code, and telephone number, including area code, of agent for service)
Copies
to:
Michael
J. Lerner, Esq.
Steven M. Skolnick, Esq.
Lowenstein Sandler LLP
1251 Avenue of the Americas
New York, New York 10020
Tel: (212) 262-6700
Approximate date of commencement of proposed sale to the
public
: As soon as practicable after this registration statement becomes effective.
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, check the following box. ☒
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the
same offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant 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," "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 company
☐
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 7(a)(2)(B) of the Securities Act.
☐
CALCULATION OF REGISTRATION FEE
Title of Each Class of Securities to be Registered
Amount to be Registered
(2)
Proposed Maximum Offering Price Per Share
(3)
Proposed
Maximum
Aggregate
Offering Price
Amount of
Registration Fee
Common Stock, par value $0.001 per share
(1)
760,500
$
1.54
$
1,171,170
$
$141.95
(1)
Represents the resale of shares of Common Stock issuable
upon the exercise of certain warrants issued in a private placement described herein.
(2)
In addition to the shares of Common Stock set forth in this table, pursuant to Rule 416 under the Securities Act, this registration
statement also registers such indeterminate number of shares of Common Stock as may become issuable upon exercise of these securities
as the same may be adjusted as a result of stock splits, stock dividends, recapitalizations or other similar transactions.
(3)
Estimated solely for the purpose of computing the amount of the registration fee for the shares of Common Stock issuable upon
exercise of warrants being registered in accordance with Rule 457(c) under the Securities Act based upon the average of the high
and low prices for a share of the registrant's common stock as reported on The Nasdaq Capital Market on June 21, 2019, which
date is within five business days of the filing of this registration statement.
The registrant hereby amends this registration statement
on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which
specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities
Act or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
The
information in this prospectus is not complete and may be changed. The selling stockholders named in this prospectus may not sell
these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the
offer or sale is not permitted.
PRELIMINARY
PROSPECTUS, SUBJECT TO COMPLETION, DATED JUNE 25, 2019
760,500 Shares of Common Stock
Issuable
upon Exercise of Outstanding Warrants
This
prospectus relates to the resale from time to time, by the selling stockholders identified in this prospectus under the caption
"Selling Stockholders," of up to 760,500 shares of our common stock, par value $0.001 per share, they may acquire
upon the exercise of outstanding warrants, which we refer to as the Warrants. We issued the Warrants to the selling stockholders
in a private placement concurrent with a registered direct offering of 1,170,000 shares of our common stock which was completed
on June 5, 2019.
The
selling stockholders may sell the shares of common stock being offered by this prospectus from time to time on terms to be determined
at the time of sale through ordinary brokerage transactions or through any other means described in this prospectus under "Plan
of Distribution." The prices at which the selling stockholders may sell the shares will be determined by the prevailing
market price for the shares or in negotiated transactions. We will not receive any proceeds from the sale of the shares by the
selling stockholders. However, we will receive the proceeds from the exercise of the Warrants by the selling stockholders, if
any, to the extent that the Warrants are not exercised on a cashless basis. See the section entitled "Use of Proceeds"
on page 25 of this prospectus.
I
nvesting
in our securities involves a high degree of risk. See "Risk Factors" beginning on page 6 of this prospectus.
You should carefully consider these risk factors, as well as the information contained in this prospectus, before you invest.
Our
common stock is listed on The Nasdaq Capital Market, or Nasdaq, under the symbol "DMPI." On June 21, 2019, the last
reported sale price of our common stock was $1.54 per share. On May 8, 2019, we effected a one-for-ten reverse stock split of
our issued and outstanding and authorized Common Stock.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The
date of this Prospectus is           , 2019
TABLE
OF CONTENTS
Page
PROSPECTUS SUMMARY
1
THE OFFERING
5
RISK FACTORS
6
FORWARD-LOOKING STATEMENTS
24
USE OF PROCEEDS
25
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
26
BUSINESS
34
MANAGEMENT
57
EXECUTIVE COMPENSATION
61
CERTAIN RELATIONSHIPS AND RELATED PERSON TRANSACTIONS
65
PRINCIPAL STOCKHOLDERS
66
MARKET PRICE OF OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS
67
DIVIDEND POLICY
67
SELLING STOCKHOLDERS
67
DESCRIPTION OF SECURITIES
69
PLAN OF DISTRIBUTION
72
LEGAL MATTERS
74
EXPERTS
74
WHERE YOU CAN FIND MORE INFORMATION
74
INDEX TO FINANCIAL STATEMENTS
F-1
i
ABOUT
THIS PROSPECTUS
The
registration statement of which this prospectus forms a part that we have filed with the Securities and Exchange Commission, or
SEC, includes exhibits that provide more detail of the matters discussed in this prospectus. You should read this prospectus and
the related exhibits filed with the SEC, together with the additional information described under the heading "Where You
Can Find More Information" before making your investment decision.
You
should rely only on the information provided in this prospectus or in a prospectus supplement or any free writing prospectuses
or amendments thereto. We have not authorized anyone else to provide you with different information. If anyone provides you with
different or inconsistent information, you should not rely on it. You should assume that the information in this prospectus is
accurate only as of the date hereof. Our business, financial condition, results of operations and prospects may have changed since
that date.
We
are not selling any shares of our common stock under this prospectus, and we will not receive any proceeds from the sale of shares
of common stock offered hereby by the selling stockholders. This prospectus may only be used where it is legal to offer and sell
our securities. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities
in any jurisdiction where the offer or sale is not permitted.
DelMar
Pharmaceuticals, Inc. and its consolidated subsidiaries are referred to herein as "DelMar," "the Company,"
"we," "us" and "our," unless the context indicates otherwise. Solely for convenience, trademarks
and tradenames referred to in this prospectus may appear without the ® or ™ symbols, but such references are not intended
to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights, or that the applicable
owner will not assert its rights, to these trademarks and tradenames.
ii
PROSPECTUS
SUMMARY
This
summary contains basic information about us and this offering. Because it is a summary, it does not contain all of the information
that you should consider before investing. To understand this offering fully, you should read this entire prospectus carefully,
including the section entitled "Risk Factors" and any information incorporated by reference herein.
On
May 8, 2019, we effected a one-for-ten reverse stock split (the "Reverse Stock Split") of our issued and outstanding
and authorized common stock. All per share amounts and number of shares of common stock in this prospectus reflect the Reverse
Stock Split. The Reverse Stock Split does not affect our authorized preferred stock of 5,000,000 shares; except that, pursuant
to the terms of the Certificate of Designations of Series B Convertible Preferred Stock for the issued and outstanding shares
of our Series B Convertible Preferred Stock, par value $0.001 per share (the "Series B Preferred Stock"), the conversion
price at which shares of Series B Preferred Stock may be converted into shares of common stock will be proportionately adjusted
to reflect the Reverse Stock Split.
Our
Business
Background
We
are a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. Our
mission is to benefit patients by developing and commercializing anti-cancer therapies for patients whose tumors exhibit features
that make them resistant to, or unlikely to respond to, currently available therapies, particularly for orphan cancer indications
where patients have failed, or are unlikely to respond to, currently available therapy.
As
of December 31, 2018, we have spent approximately $37.3 million of shareholder capital in developing VAL-083, a novel, validated,
DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma multiforme ("GBM") and
potentially other solid tumors, including ovarian cancer, non-small cell lung cancer ("NSCLC"), and diffuse intrinsic
pontine glioma ("DIPG"). VAL-083 is a first-in-class, small-molecule, DNA-targeting chemotherapeutic that demonstrated
activity against a range of tumor types in prior Phase 1 and Phase 2 clinical studies sponsored by the US National Cancer Institute
("NCI"). As part of our business strategy, we leverage and build upon these prior NCI investments and data from more
than 40 NCI- Phase 1 and Phase 2 clinical studies, which includes an estimated 1,000 patient safety database, with our own research
to identify and target unmet medical needs in modern cancer care. DNA-targeting agents are among the most successful and widely
used treatments for cancer. Their efficacy is based on the ability to bind with a cancer cell's DNA and interfere with the
process of protein production required for growth and survival of cancer cells. "First-in-class" means that VAL-083
embodies a unique molecular structure which is not an analogue or derivative of any approved product, or product under development,
for the treatment of cancer.
1
Our
recent research has highlighted the opportunities afforded by VAL-083's unique mechanism of action and its potential to
address unmet medical needs by focusing our development efforts on patients whose tumors exhibit biological features that make
them resistant to, or unlikely to respond to, currently available therapies. For example, our research demonstrating VAL-083's
activity in GBM independent of the O6-methyl guanine methyltransferase ("MGMT") methylation status allows us to focus
patient selection based on this important biomarker.
We
are conducting two open-label, biomarker driven Phase 2 studies in MGMT-unmethylated GBM. MGMT is a DNA-repair enzyme that is
associated with resistance to temozolomide, the current standard-of-care chemotherapy used in the treatment of GBM. Greater than
60% of GBM patients have MGMT-unmethylated tumors and exhibit a high expression of MGMT, which is correlated with temozolomide
treatment failure and poor patient outcomes. Our research demonstrates that VAL-083's anti-tumor activity is independent
of MGMT expression. In our Phase 2 studies we are using MGMT as a biomarker to identify patients for treatment with VAL-083 in
the newly-diagnosed, maintenance-stage (adjuvant) and recurrent treatment settings. If successful, the result of these studies
could position VAL-083 for advancement to pivotal clinical studies as a potential replacement for temozolomide in MGMT-unmethylated
GBM. We anticipate presenting data from these studies at peer reviewed scientific meetings during calendar 2019.
With
respect to our STAR-3, Phase 3 study, we have finalized the decision to discontinue this clinical study due to the competitive
landscape, patient enrollment rates, and potential risk of success assessment, and to allow us to focus on enrolling GBM patients
in our two biomarker-driven Phase 2 studies.
We
have received notice to proceed from the US Food and Drug Administration ("FDA") for a phase 1/2, open-label, multicenter
study of VAL-083 in patients with
Re
current
P
latinum
R
esistant
Ov
arian
Cancer ("REPROVe"). Platinum-based chemotherapy is the standard-of-care in the treatment of ovarian cancer. Nearly
all ovarian cancer patients eventually become resistant to platinum ("Pt") based chemotherapy leading to treatment
failure and poor patient outcomes. We have demonstrated that VAL-083 is active against Pt-resistant ovarian cancer
in vitro.
However, based on ongoing evaluation and input from our ovarian cancer advisory board, we are reassessing the development
of VAL-083 for the treatment of ovarian cancer. We are in the process of evaluating the best path forward in ovarian cancer and
are evaluating strategic options, including the potential combination of VAL-083 with PARP inhibitors. At the American Association
for Cancer Research ("AACR") Annual Meeting in 2018 we presented preclinical data showing that VAL-083 can synergize
PARP inhibitors in both a BRACA-proficient and -deficient setting.
In
addition to our clinical development activities in the United States, pursuant to our collaboration with Guangxi Wuzhou Pharmaceutical
(Group) Co. Ltd. ("Guangxi Wuzhou Pharmaceutical Company"), we have provided Guangxi Wuzhou Pharmaceutical Company
certain commercial rights to VAL-083 in China where it is approved as a chemotherapy for the treatment of chronic myelogenous
leukemia ("CML") and lung cancer. Guangxi Wuzhou Pharmaceutical Company is the only manufacturer presently licensed
by the China Food and Drug Administration ("CFDA") to produce the product for the China market.
We
have a broad patent portfolio to protect our intellectual property. Our patent applications claim composition of matter and methods
of use of VAL-083 and related compounds, synthetic methods, and quality controls for the manufacturing process of VAL-083. We
believe that our portfolio of intellectual property rights provides a defensible market position for the commercialization of
VAL-083. In addition, VAL-083 has been granted protection under the Orphan Drug Act by the FDA and the European Medicines Agency
("EMA") for the treatment of gliomas, including GBM. The FDA has also granted Orphan Drug protection to VAL-083 for
the treatment of medulloblastoma and ovarian cancer.
Our
corporate development strategy is to advance our drug candidate into multiple clinical studies and then to consider licensing,
or acquiring additional product candidates, in order to establish a product pipeline and to position us for long-term sustainability
and growth of shareholder value. We believe the experience of our clinical development team will position us to efficiently develop
drug candidates that we may acquire, or license, in the future.
We
intend to continue to evaluate options for our strategic direction. These options may include raising additional capital, the
acquisition of another company and/or complementary assets, our sale, or another type of strategic partnership.
Registered
Direct Offering and Private Placement
On
June 3, 2019, we entered into a securities purchase agreement with the selling stockholders for the issuance and sale of an aggregate
of 1,170,000 shares of common stock in a registered direct offering (the "RD Offering") and warrants to purchase 760,500
shares of common stock in a concurrent private placement, at a combined purchase price of $3.10 per share and related warrant.
The warrants have an exercise price of $3.10 per share, are immediately exercisable and have a term of exercise of five years.
The closing of the issuance and sale of these securities was consummated on June 5, 2019. The gross proceeds from the offering,
prior to deducting offering expenses and placement agent fees and expenses payable by us, were $3.6 million.
Subject
to certain ownership limitations, the warrants are exercisable commencing on the issuance date at an exercise price equal to $3.10
per share of common stock, subject to adjustments as provided under the terms of the warrants. Subject to certain exceptions set
forth in the warrants, if, on or prior to June 28, 2019, we sell or grant any option to purchase or sell or grant any right to
reprice, or otherwise dispose of or issue, any common stock or securities convertible into or exercisable for common stock at
an effective price per share that is lower than the exercise price of the warrants then in effect, then the exercise price of
the Warrants will be reduced to equal the higher of  (A) such lower price or (B) $2.25. Pursuant to the terms of the securities
purchase agreement, we agreed to register for resale the shares of common stock underlying the warrants sold in the private placement.
Under the terms of the warrants, no selling stockholder may exercise a warrant to the extent the selling stockholder or any of
its affiliates would beneficially own a number of shares of our common stock which would exceed 4.99%.
2
Recent
Highlights
●
On
                                         May 22, 2019, the Nasdaq Staff notified us that we did not meet the stockholders'
                                         equity requirements as of March 31, 2019. We submitted a plan to regain compliance with
                                         Nasdaq on May 29, 2019. On June 13, 2019, the Nasdaq Hearings Panel issued a decision
                                         granting our request for continued listing, subject to the condition that on or before
                                         October 15, 2019, we shall have issued public disclosure on Form 8-K that we have met
                                         the stockholders' equity requirement and have demonstrated compliance with all
                                         other requirements for continued listing. We expect to utilize
                                         the proceeds from the Rights Offering (as defined below) and the RD Offering towards
                                         establishing compliance with such requirement; provided that we will need to raise additional
                                         capital to obtain compliance.
●
On
                                         April 18, 2019, we filed a registration statement in connection with a proposed rights
                                         offering (the "Rights Offering"), which registration statement was last amended
                                         on June 10, 2019. In the Rights Offering, we are proposing to issue an aggregate of 1,860
                                         units, with each unit comprising of one share of Series C Convertible Preferred Stock
                                         with a stated value of $1,000 and 209 warrants to purchase common stock. The warrants
                                         have an exercise price of $3.10 per share, are immediately exercisable and have a term
                                         of exercise of five years. Assuming the Rights Offering is fully subscribed and subject
                                         to revocation rights, the gross proceeds from the Rights Offering, prior to deducting
                                         offering expenses and dealer-manager fees and expenses payable by us, are expected to
                                         be $1.86 million.
●
On
                                         April 4, 2019, we announced the formation of a Scientific Advisory Board ("SAB").
                                         Its inaugural members are Drs. Napoleone Ferrara and John de Groot. Dr. John de Groot,
                                         Chairman, ad interim of the Department of Neuro-Oncology at the MD Anderson Cancer Center
                                         is an expert in glioma biology and angiogenesis which is the key area of clinical development
                                         for VAL-083. Dr. Ferrara is a world-renowned molecular biologist whose pioneering work
                                         on the identification of VEGF, a signal protein produced by cells that stimulates the
                                         formation of blood vessels, led to the development of Genentech Inc.'s Avastin
®
for the treatment of certain types of cancer, including ovarian cancer and GBM.
                                         Dr. Ferrara is also a member of our Board of Directors and he will serve as the SAB's
                                         Chairman. The SAB will work closely with our management team to optimize the development
                                         of VAL-083.
●
As
                                         of March 13, 2019, we have enrolled 47 of the planned 48 patients in our Phase 2, open-label
                                         clinical study of VAL-083 in bevacizumab (Avastin
®
)-naïve, recurrent
                                         glioblastoma multiforme ("rGBM") patients with MGMT-unmethylated status.
                                         This study is being conducted at the MD Anderson Cancer Center ("MDACC")
                                         in Houston, Texas. The study is designed to determine the impact of VAL-083 treatment
                                         on overall survival compared to historical reference control.
●
On
                                         April 3, 2019, we announced that the MDACC Institutional Review Board ("IRB")
                                         had approved the addition of up to 35 patients to our recurrent GBM study at a dose of
                                         30 mg/m
2
. As previously disclosed, we had lowered the dose in this study from
                                         40 mg/m
2
to 30 mg/m
2
to improve tolerance in this patient population
                                         and to maximize overall exposure to VAL-083 thereby increasing the number of cycles of
                                         drug patients are able to receive. Upon completion of the initial 48 patients in this
                                         study, 13 will have had the 30 mg/m
2
dose and 35 will have had the 40
                                         mg/m
2
. Therefore, potentially adding an additional 35 patients at 30 mg/m
2
would result in a total of 48 patients receiving the 30 mg/m
2
dose.
                                         In addition, the MDACC IRB approved the addition of up to 24 patients in the pre-temozolomide
                                         ("TMZ") maintenance setting. These patients will have had an initial cycle
                                         of temozolomide following radiation but will not have yet started subsequent cycles of
                                         temozolomide (i.e. maintenance stage TMZ patients). Subject to obtaining financing and
                                         all regulatory approvals, we are planning a new study arm that would potentially enroll
                                         up to 24 pre-TMZ maintenance stage, MGMT-unmethylated GBM patients.
●
As
                                         of February 15, 2019, we have enrolled 15 of the planned up to 30 patients in our Phase
                                         2, open-label clinical study of VAL-083 in newly-diagnosed, MGMT-unmethylated GBM patients
                                         being conducted in Guangzhou, China. This study is a single-site study being conducted
                                         at Sun Yat-sen University Cancer Center ("SYSUCC") on newly diagnosed MGMT-unmethylated
                                         GBM patients. Patients in this study are being treated with VAL-083 in combination with
                                         radiotherapy as a potential alternative to the current standard-of-care chemo-radiation
                                         regimen.
●
At
the annual meeting of the AACR held March 29 to April 3, 2019, we presented clinical study updates on both of our Phase 2 studies
in MGMT-unmethylated GBM patients, as well as, preclinical presentations on VAL-083 in combination with Avastin
®
and on the potential to overcome major challenges in the treatment of DIPG.
Clinical
Updates Presented at 2019 American Society of Clinical Oncology
On
May 31, 2019, we presented clinical trial updates from our ongoing first- and second-line trials in patients with MGMT-unmethylated
glioblastoma multiforme (GBM) at a key opinion leader (KOL) presentation during the 2019 American Society of Clinical Oncology
(ASCO) annual meeting in Chicago, IL.
At
the KOL presentation, we provided an update on the ongoing Phase 2 clinical study investigating the front-line treatment of VAL-083
with radiation therapy in newly diagnosed MGMT-unmethylated GBM. This trial is being conducted at the Sun Yat-sen University Cancer
Center (SYSUCC) in Guangzhou, China in collaboration with Guangxi Wuzhou Pharmaceutical Company. The trial is designed to enroll
up to 30 patients to determine if first-line therapy with VAL-083 treatment, in lieu of first-line temozolomide, improves progression
free survival (PFS).
3
As
of May 17, 2019, eighteen patients have been enrolled in the trial. Of these patients, fifteen have received their post-cycle
3 MRI and investigator assessment, and ten have received their post-cycle 7 MRI and investigator assessment. Two patients have
not been on the study long enough to reach their first assessment, and one patient died before their first assessment. Assessments
are based on the trial investigator's clinical and radiologic assessment, according to the Response Assessment in NeuroOncology
(RANO) criteria. For the fifteen patients who have received at least one assessment, eight patients were assessed with a best
response of "Complete Response" (8/15, 53.3% CR) and seven patients were assessed with a best response of "Stable
Disease" (7/15, 46.7% SD). Fourteen of the eighteen patients were still alive at the data cut-off date.
We
also provided an update on the ongoing second-line Phase 2 clinical study of VAL-083 in patients with MGMT-unmethylated, Bevacizumab-naïve
recurrent GBM. This study is being conducted in collaboration with The University of Texas MD Anderson Cancer Center (MDACC).
This biomarker-driven trial (testing for MGMT methylation status) has been amended to enroll up to 83 patients (35 with a starting
dose of 40 mg/m
2
; 48 with a starting dose of 30 mg/m
2
) to determine the potential of VAL-083 treatment to
improve overall survival compared to historical reference control of 7.2 months with lomustine.
●
As
                                         of May 5, 2019, 51 patients have been enrolled, 35 patients at a starting dose of 40
                                         mg/m
2
, and 16 patients at a starting dose of 30 mg/m
2
.
●
For
                                         the 47 patients who have been on study long enough to be assessed at the post-cycle 2
                                         MRI:
●
9/35
                                         (25.7%) patients initially receiving 40 mg/m
2
exhibited "Stable Disease"
                                         per investigator assessment at the end of cycle 2
●
4/12
                                         (33.3%) patients initially receiving 30 mg/m
2
exhibited "Stable Disease"
                                         per investigator assessment at the end of cycle 2
Additionally,
the study protocol has been amended to include enrollment of up to 24 newly-diagnosed GBM patients who have completed chemoradiation
treatment with TMZ and received no subsequent TMZ maintenance therapy but will receive VAL-083 instead (Group 2). This Group has
been included to explore whether earlier intervention with VAL-083 instead of TMZ maintenance therapy offers clinical benefit
and extends the time to recurrence as compared to TMZ maintenance therapy.
Consistent
with prior studies, myelosuppression (primarily thrombocytopenia and neutropenia) is the most common adverse event in both ongoing
clinical trials.
Risks
Affecting Us
Our
business is subject to numerous risks described in the section entitled "Risk Factors" and elsewhere in this prospectus.
You should carefully consider these risks before making an investment. Some of these risks include:
●
We
                                         have expressed substantial doubt about our ability to continue as a going concern;
●
We
                                         have a limited operating history and a history of operating losses and expect to incur
                                         significant additional operating losses;
●
We
                                         will need to raise additional capital;
●
We
                                         are an early-stage company and may never achieve commercialization of our candidate products
                                         or profitability;
●
We
                                         are currently focused on the development of a single product candidate;
●
Clinical
                                         trials for our product candidate are expensive and time consuming, and their outcome
                                         is uncertain; and
●
We
                                         may not receive regulatory approvals for our product candidate or there may be a delay
                                         in obtaining such approvals.
Company
Information
We
are a Nevada corporation formed on June 24, 2009 under the name Berry Only Inc. On January 25, 2013, we entered into and closed
an exchange agreement (the "Exchange Agreement"), with Del Mar Pharmaceuticals (BC) Ltd. ("Del Mar (BC)"),
0959454 B.C. Ltd. ("Callco"), and 0959456 B.C. Ltd. ("Exchangeco") and the security holders of Del Mar
(BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of ours (the "Reverse Acquisition").
We
are the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010, which is a clinical
stage company with a focus on the development of drugs for the treatment of cancer. We are also the parent company to Callco and
Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition.
Our
principal executive offices are located at Suite 720-999 West Broadway, Vancouver, British Columbia, Canada V5Z 1K5 and our telephone
number is (604) 629-5989. We maintain an internet website at
www.delmarpharma.com
. We do not incorporate the information
on our website into this prospectus and you should not consider it part of this prospectus.
4
the
Offering
Securities
    to be Offered by the Selling Stockholders
Up to 760,500
    shares of common stock issuable upon exercise of outstanding warrants.
Use of Proceeds
All
    proceeds from the sale of the shares of common stock under this prospectus will be for the account of the selling stockholders.
    We will not receive any proceeds from the sale of our shares of common stock offered pursuant to this prospectus. Any net
    proceeds received by us from the exercise of the warrants will be used for our clinical trials and for general corporate purposes,
    which may include working capital, capital expenditures, research and development and other commercial expenditures. In addition,
    we may use the net proceeds from this offering for investments in businesses, products or technologies that are complementary
    to our business. Pending these uses, we intend to invest the funds in short-term, investment grade, interest-bearing securities.
    It is possible that, pending their use, we may invest the net proceeds in a way that does not yield a favorable, or any, return
    for us. See the section entitled "Use of Proceeds" in this prospectus.
Risk Factors
You should read the
    section entitled "Risk Factors" in this prospectus for a discussion of the factors to consider carefully before
    deciding to invest in shares of our common stock.
Nasdaq Capital Market
    Symbol
DMPI
5
RISK
FACTORS
Investing
in our securities involves a high degree of risk. In determining whether to purchase our common stock, an investor should carefully
consider all of the material risks described below, together with the other information contained in this report before making
a decision to purchase our securities. An investor should only purchase our securities if he or she can afford to suffer the loss
of his or her entire investment.
Risks
Related to Our Business
We
have expressed substantial doubt about our ability to continue as a going concern.
As
discussed in Note 1 to the consolidated financial statements for the year ended June 30, 2018, our audited financial statements
for the fiscal year ended June 30, 2018, include an explanatory paragraph that such financial statements were prepared assuming
that we will continue as a going concern. A going concern basis assumes that we will continue our operations for the foreseeable
future and contemplates the realization of assets and the settlement of liabilities in the normal course of business.
For
the year ended June 30, 2018 and the nine months ended March 31, 2019, we reported a loss of $11,138,312 and $5,465,486, respectively,
and a negative cash flow from operations of $9,850,850 and $4,514,674, respectively. We had an accumulated deficit of $57,988,567
as at March 31, 2019. As at March 31, 2019, we had cash and cash equivalents on hand of $2,152,233. We are in the development
stage and have not generated any revenues to date. We do not have the prospect of achieving revenues until such time that our
product candidate is commercialized, or partnered, which may not ever occur. In the near future, we will require additional funding
to maintain our clinical studies, research and development projects, and for general operations. These circumstances indicate
substantial doubt exists about our ability to continue as a going concern.
Consequently,
management is pursuing various financing alternatives to fund our operations so it can continue as a going concern. Management
plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership arrangements.
We may tailor our drug candidate development program based on the amount of funding we are able to raise in the future. Nevertheless,
there is no assurance that these initiatives will be successful.
The
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should we be unable to continue as a going concern. Such adjustments could be material.
We
have a limited operating history and a history of operating losses and expect to incur significant additional operating losses.
We
are an early stage company and there is limited historical financial information upon which to base an evaluation of our performance.
Our prospects must be considered in light of the uncertainties, risks, expenses, and difficulties frequently encountered by companies
in their early stages of operations. We expect to incur substantial additional net expenses over the next several years as our
research, development and commercial activities increase. The amount of future losses and when, if ever, we will achieve profitability
are uncertain. Our ability to generate revenue and achieve profitability will depend on, among other things, successful completion
of the preclinical and clinical development of our product candidate; obtaining necessary regulatory approvals from the FDA and
international regulatory agencies; successful manufacturing, sales and marketing arrangements; and raising sufficient funds to
finance our activities. If we are unsuccessful at some or all of these undertakings, our business, prospects and results of operations
may be materially adversely affected.
We
will need to raise additional capital, which may cause dilution to our stockholders, restrict our operations or require us to
relinquish rights to technologies or product candidates.
Until
such time, if ever, as we can generate substantial product revenues, we expect to finance our cash needs through a combination
of public or private equity offerings, debt financings and/or license and development agreements with collaboration partners.
As of March 31, 2019, we had cash and cash equivalents to fund operations into the middle of calendar 2019. We expect the net
proceeds from the Right Offering to be $1.2 million assuming all of the securities are sold and subject to revocation rights,
which, together with the net proceeds from the RD Offering of approximately $3.2 million, we expect to fund our operations until
into the first quarter of calendar 2020. We will also need to raise additional capital to fund our operations. We do not have
any committed external source of funds. To the extent that we raise additional capital through the sale of equity or convertible
debt securities, then-existing stockholders' interests may be materially diluted, and the terms of such securities could
include liquidation or other preferences that adversely affect their rights as common stockholders. Debt financing and preferred
equity financing, if available, may involve agreements that include restrictive covenants that limit our ability to take specified
actions, such as incurring additional debt, making capital expenditures or declaring dividends. In addition, debt financing would
result in fixed payment obligations.
In
addition, we have retained Oppenheimer & Co. Inc. as a financial advisor to assist us in our evaluation of a broad range of
strategic alternatives to enhance stockholder value, including additional capital raising transactions, an acquisition, merger,
business combination, licensing and/or other strategic transaction involving us. There is no assurance that the review of strategic
alternatives will result in us changing our business plan, pursuing any particular transaction, or, if we pursue any such transaction,
that it will be completed. We do not expect to make further public comment regarding the strategic review until our Board of Directors
has approved a specific transaction or otherwise deems disclosure of significant developments is appropriate.
If
we raise funds through collaborations, strategic partnerships or marketing, distribution or licensing arrangements with third
parties, we may have to relinquish valuable rights to our technologies, future revenue streams, research programs or product candidates
or grant licenses on terms that may not be favorable to us. If we are unable to raise additional funds through equity or debt
financings when needed, we may be required to delay, limit, reduce or terminate our product development or future commercialization
efforts or grant rights to develop and market product candidates that we would otherwise prefer to develop and market ourselves.
6
Our
inability to obtain additional financing could adversely affect our ability to meet our obligations under our planned clinical
studies and could negatively impact the timing of our clinical results.
Our
ability to meet our obligations and continue the research and development of our product candidate is dependent on our ability
to continue to raise adequate financing. We may not be successful in obtaining such additional financing in the amount required
at any time, or for any period, or, if available, that it can be obtained on terms satisfactory to us. In the event that we are
unable to obtain such additional financing, we may be unable to meet our obligations under our planned clinical studies and we
may have to tailor our drug candidate development programs based on the amount of funding we raise which could negatively impact
the timing of our clinical results. In addition, we could be required to cease our operations.
Our
exploration and pursuit of strategic alternatives may not be successful.
In
September 2018, we announced that we had retained Oppenheimer & Co. Inc. as a financial advisor to assist us in our evaluation
of a broad range of strategic alternatives. Potential strategic alternatives that may be explored or evaluated as part of this
process include the potential for capital raising transactions, an acquisition, merger, business combination, licensing and/or
other strategic transaction involving us. Despite devoting efforts to identify and evaluate potential strategic transactions,
the process may not result in any definitive offer to consummate a strategic transaction, or, if we receive such a definitive
offer, the terms may not be as favorable as anticipated or may not result in the execution or approval of a definitive agreement.
Even if we enter into a definitive agreement, we may not be successful in completing a transaction or, if we complete such a transaction,
it may not enhance stockholder value or deliver expected benefits.
If
we fail to regain compliance with the stockholders' equity requirements of The Nasdaq Capital Market LLC ("Nasdaq")
or other requirements for continued listing, our common stock may be delisted and the price of our common stock and our ability
to access the capital markets could be negatively impacted.
Our
common stock is listed for trading on The Nasdaq Capital Market. On May 22, 2019 and May 23, 2019, we received written notices
(collectively, the "Notice") from the Listing Qualifications Department of The Nasdaq Stock Market LLC ("The
Nasdaq Stock Market") indicating that, in light of our having reported stockholders' equity of $1,259,161 as of March
31, 2019 in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2019, we were not in compliance with the $2,500,000
minimum stockholders' equity requirement set forth in Nasdaq Listing Rule 5550(b)(1) for continued listing on Nasdaq (the
"Stockholders' Equity Requirement"), or with any alternative standard under the Nasdaq Listing Rules. The Notice
requested that we present a plan to regain compliance with the above-mentioned deficiency by written submission no later than
May 29, 2019, which plan was submitted on such date, in order to be considered by the Nasdaq Hearings Panel that was, until May
23, 2019, considering our continued listing due to our previous deficiency with respect to the $1.00 per share bid price requirement,
as described below. On June 13, 2019, the Nasdaq Hearings Panel issued a decision granting our request for continued listing,
subject to the condition that on or before October 15, 2019, we shall have issued public disclosure on Form 8-K that we have met
the Stockholders' Equity Requirement and have demonstrated compliance with all other requirements for continued listing. We expect to utilize the proceeds from the Rights Offering and the RD Offering towards establishing
compliance with such requirement; provided that we will need to raise additional capital to obtain compliance.
As
previously disclosed, on June 28, 2018, the Staff of the Listing Qualifications Department of The Nasdaq Stock Market (the "Nasdaq
Staff") notified the Company that it did not comply with the minimum $1.00 per share bid price requirement for continued
listing, as set forth in Nasdaq Listing Rule 5550(a)(2) (the "Bid Price Requirement"), and we were therefore granted
180 calendar days, through December 26, 2018, to regain compliance. On December 27, 2018, the Nasdaq Staff notified us that we
had not regained compliance with the Bid Price Requirement, that our stockholders' equity as reported in our Quarterly Report
on Form 10-Q for the quarter ended September 30, 2018 did not qualify us for an additional 180 calendar day extension period for
compliance and that we would therefore be subject to delisting unless we requested a hearing before a Nasdaq Hearings Panel. Accordingly,
we requested a hearing, which was held on January 31, 2019, at which we presented our plan of compliance. On February 4, 2019,
the Nasdaq Hearings Panel issued a decision granting our request for continued listing of our common stock on The Nasdaq Capital
Market pursuant to an extension through June 25, 2019, subject to the condition that we shall have demonstrated a closing bid
price of $1.00 per share or more for a minimum of ten consecutive business days by June 25, 2019. As a result of our previously
disclosed one-for-ten reverse stock split effected on May 8, 2019, on May 23, 2019, we received written notice from Nasdaq that
the Company has regained compliance with the Bid Price Requirement.
Subject
to our issuance of public disclosure on Form 8-K that we have meet the Stockholders' Equity Requirement and our demonstrating
compliance for continued listing, our common stock will continue to be listed on Nasdaq, and our common
stock will continue to trade under the symbol "DMPI." Our receipt of the Notice does not affect our business, operations
or reporting requirements with the SEC.
Notwithstanding,
there can be no assurance that we will be able to regain compliance, and if we are unable to regain compliance with the Stockholders'
Equity Requirement, or if we fail to meet any of the other continued listing requirements, our securities may be delisted from
Nasdaq, which could reduce the liquidity of our common stock materially and result in a corresponding material reduction in the
price of our common stock. In addition, delisting could harm our ability to raise capital through alternative financing sources
on terms acceptable to us, or at all, and may result in the potential loss of confidence by investors, employees and business
development opportunities. Such a delisting likely would impair your ability to sell or purchase our common stock when you wish
to do so. Further, if we were to be delisted from Nasdaq, our common stock may no longer be recognized as a "covered security"
and we would be subject to regulation in each state in which we offer our securities. Thus, delisting from Nasdaq could adversely
affect our ability to raise additional financing through the public or private sale of equity securities, would significantly
impact the ability of investors to trade our securities and would negatively impact the value and liquidity of our common stock.
7
If
we are unable to effectively implement or maintain a system of internal control over financial reporting, we may not be able to
accurately or timely report our financial results and our stock price could be adversely affected.
Section
404 of the Sarbanes-Oxley Act of 2002 and related regulations require us to evaluate the effectiveness of our internal control
over financial reporting as of the end of each fiscal year, and to include a management report assessing the effectiveness of
our internal control over financial reporting in our Annual Report on Form 10-K for that fiscal year. Management determined that
as of June 30, 2018 and in past periods, our disclosure controls and procedures and internal control over financial reporting
were not effective due to material weaknesses in our internal control over financial reporting related to our limited number of
employees in our accounting department and inadequate segregation of duties over authorization, review and recording of transactions,
as well as the financial reporting of such transactions. Any failure to implement new or improved controls necessary to remedy
the material weaknesses described above, or difficulties encountered in the implementation or operation of these controls, could
harm our operations, decrease the reliability of our financial reporting, and cause us to fail to meet our financial reporting
obligations, which could adversely affect our business and reduce our stock price.
We
are an early-stage company and may never achieve commercialization of our candidate products or profitability.
We
are at an early stage of development and commercialization of our technologies and product candidate. We have not yet begun to
market any products and, accordingly, have not begun or generate revenues from the commercialization of our product. Our product
will require significant additional clinical testing and investment prior to commercialization. A commitment of substantial resources
by ourselves and, potentially, our partners to conduct time-consuming research and clinical studies will be required if we are
to complete the development of our product candidate. There can be no assurance that our product candidate will meet applicable
regulatory standards, obtain required regulatory approvals, be capable of being produced in commercial quantities at reasonable
costs or be successfully marketed. Our product candidate is not expected to be commercially available for several years, if at
all.
We
are currently focused on the development of a single product candidate.
Our
product development efforts are currently focused on a single product, VAL-083, for which we are researching multiple indications.
If VAL-083 fails to achieve clinical endpoints or exhibits unanticipated toxicity or if a superior product is developed by a competitor,
our prospects for obtaining regulatory approval and commercialization may be negatively impacted. In the long-term, we hope to
establish a pipeline of product candidates, and we have identified additional product candidates that we may be able to acquire
or license in the future. However, at this time we do not have any formal agreements granting us any rights to such additional
product candidates.
Even
if we are able to commercialize any product candidate that we develop, the product may become subject to unfavorable pricing regulations,
third-party payor reimbursement practices or healthcare reform initiatives that could harm our business.
The
commercial success of our current or future product candidates will depend substantially, both domestically and abroad, on the
extent to which the costs of our product candidate will be paid by health maintenance, managed care, pharmacy benefit and similar
healthcare management organizations, or reimbursed by government health administration authorities (such as Medicare and Medicaid),
private health coverage insurers and other third-party payors. If reimbursement is not available, or is available only to limited
levels, we may not be able to successfully commercialize our products. Even if coverage is provided, the approved reimbursement
amount may not be high enough to allow us to establish and maintain pricing sufficient to realize a meaningful return on our investment.
There
is significant uncertainty related to third-party payor coverage and reimbursement of newly approved drugs. Marketing approvals,
pricing and reimbursement for new drug products vary widely from country to country. Some countries require approval of the sale
price of a drug before it can be marketed. In many countries, the pricing review period begins after marketing or product licensing
approval is granted. In some non-U.S. markets, prescription pharmaceutical pricing remains subject to continuing governmental
control even after initial approval is granted. As a result, we might obtain marketing approval for a product in a particular
country, but then be subject to price regulations that delay commercial launch of the product, possibly for lengthy time periods,
which may negatively impact the revenues we are able to generate from the sale of the product in that country. Adverse pricing
limitations may hinder our ability to recoup our investment in one or more product candidates, even if our product candidates
obtain marketing approval.
Our
ability to commercialize VAL-083 or any other product candidates will depend in part on the extent to which coverage and reimbursement
for these products and related treatments will be available from government health administration authorities, private health
insurers and other organizations. Government authorities and third-party payors, such as private health insurers and health maintenance
organizations, decide which medications they will cover and establish reimbursement levels. The healthcare industry is acutely
focused on cost containment, both in the United States and elsewhere. Government authorities and third-party payors have attempted
to control costs by limiting coverage and the amount of reimbursement for particular medications, which could affect our ability
to sell our product candidate profitably. These payors may not view our products, if any, as cost-effective, and coverage and
reimbursement may not be available to our customers, or may not be sufficient to allow our products, if any, to be marketed on
a competitive basis. Cost-control initiatives could cause us to decrease the price we might establish for products, which could
result in lower than anticipated product revenues. If the prices for our products, if any, decrease or if governmental and other
third-party payors do not provide adequate coverage or reimbursement, our prospects for revenue and profitability will suffer.
8
There
may also be delays in obtaining coverage and reimbursement for newly approved drugs, and coverage may be more limited than the
indications for which the drug is approved by the FDA or comparable non-U.S. regulatory authorities. Moreover, eligibility for
reimbursement does not imply that any drug will be paid for in all cases or at a rate that covers our costs, including research,
development, manufacture, sale and distribution. Reimbursement rates may vary, by way of example, according to the use of the
drug and the clinical setting in which it is used. Reimbursement rates may also be based on reimbursement levels already set for
lower cost drugs or may be incorporated into existing payments for other services.
In
addition, increasingly, third-party payors are requiring higher levels of evidence of the benefits and clinical outcomes of new
technologies and are challenging the prices charged. We cannot be sure that coverage will be available for any product candidate
that we, or they, commercialize and, if available, that the reimbursement rates will be adequate. Further, the net reimbursement
for drug products may be subject to additional reductions if there are changes to laws that presently restrict imports of drugs
from countries where they may be sold at lower prices than in the United States. An inability to promptly obtain coverage and
adequate payment rates from both government-funded and private payors for any of our product candidates for which we obtain marketing
approval could have a material adverse effect on our operating results, our ability to raise capital needed to commercialize products
and our overall financial condition.
We
are dependent on obtaining certain patents and protecting our proprietary rights.
Our
success will depend, in part, on our ability to obtain patents, maintain trade secret protection and operate without infringing
on the proprietary rights of third parties or having third parties circumvent our rights. We have filed and are actively pursuing
patent applications for our products. The patent positions of biotechnology, biopharmaceutical and pharmaceutical companies can
be highly uncertain and involve complex legal and factual questions. Thus, there can be no assurance that any of our patent applications
will result in the issuance of patents, that we will develop additional proprietary products that are patentable, that any patents
issued to us or those that already have been issued will provide us with any competitive advantages or will not be challenged
by any third parties, that the patents of others will not impede our ability to do business or that third parties will not be
able to circumvent our patents. Furthermore, there can be no assurance that others will not independently develop similar products,
duplicate any of our products not under patent protection, or, if patents are issued to us, design around the patented products
we developed or will develop.
We
may be required to obtain licenses from third parties to avoid infringing patents or other proprietary rights. No assurance can
be given that any licenses required under any such patents or proprietary rights would be made available, if at all, on terms
we find acceptable. If we do not obtain such licenses, we could encounter delays in the introduction of products or could find
that the development, manufacture or sale of products requiring such licenses could be prohibited.
A
number of pharmaceutical, biopharmaceutical and biotechnology companies and research and academic institutions have developed
technologies, filed patent applications or received patents on various technologies that may be related to or affect our business.
Some of these technologies, applications or patents may conflict with our technologies or patent applications. Such conflict could
limit the scope of the patents, if any, that we may be able to obtain or result in the denial of our patent applications. In addition,
if patents that cover our activities are issued to other companies, there can be no assurance that we would be able to obtain
licenses to these patents at a reasonable cost or be able to develop or obtain alternative technology. If we do not obtain such
licenses, we could encounter delays in the introduction of products, or could find that the development, manufacture or sale of
products requiring such licenses could be prohibited. In addition, we could incur substantial costs in defending ourselves in
suits brought against us on patents it might infringe or in filing suits against others to have such patents declared invalid.
Patent
applications in the U.S. are maintained in secrecy and not published if either: i) the application is a provisional application
or ii) the application is filed and we request no publication, and certify that the invention disclosed "has not and will
not" be the subject of a published foreign application. Otherwise, U.S. applications or foreign counterparts, if any, publish
18 months after the priority application has been filed. Since publication of discoveries in the scientific or patent literature
often lag behind actual discoveries, we cannot be certain that we or any licensor were the first creator of inventions covered
by pending patent applications or that we or such licensor was the first to file patent applications for such inventions. Moreover,
we might have to participate in interference proceedings declared by the U.S. Patent and Trademark Office to determine priority
of invention, which could result in substantial cost to us, even if the eventual outcome were favorable to us. There can be no
assurance that our patents, if issued, would be held valid or enforceable by a court or that a competitor's technology or
product would be found to infringe such patents.
Moreover,
we may be subject to third-party preissuance submissions of prior art to the USPTO, or become involved in opposition, derivation,
reexamination,
inter partes
review, post-grant review or interference proceedings challenging our patent rights or the
patent rights of others. An adverse determination in any such submission, proceeding or litigation could reduce the scope of,
or invalidate, our patent rights, allow third parties to commercialize our technology or products and compete directly with us,
without payment to us, or result in our inability to manufacture or commercialize products without infringing third-party patent
rights.
9
Even
if our patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection,
prevent competitors from competing with us, or otherwise provide us with any competitive advantage. Our competitors may be able
to circumvent our patents by developing similar or alternative technologies or products in a non-infringing manner.
The
issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability, and our patents may be challenged
in courts or patent offices in the United States and abroad. Such challenges may result in loss of exclusivity or freedom to operate,
or in patent claims being narrowed, invalidated or held unenforceable, in whole or in part, which could limit our ability to stop
others from using or commercializing similar or identical technology and products, or limit the duration of the patent protection
of our technology and products. Given the amount of time required for the development, testing and regulatory review of new product
candidates, patents protecting such candidates might expire before or shortly after such candidates are commercialized. As a result,
our owned and licensed patent portfolio may not provide us with sufficient rights to exclude others from commercializing products
similar or identical to ours.
In
addition, the protection of intellectual property rights in China (where our clinical product candidate, VAL-083, is manufactured
pursuant to a collaboration agreement with the only manufacturer presently licensed by the CFDA to manufacture VAL-083 for the
China market, and where VAL-083 is approved for the treatment of CML and lung cancer) is relatively weak compared to the United
States, which may negatively affect our ability to generate royalty revenue from sales of VAL-083 in China.
Much
of our know-how and technology may not be patentable. To protect our rights, we require employees, consultants, advisors and collaborators
to enter into confidentiality agreements. There can be no assurance, however, that these agreements will provide meaningful protection
for our trade secrets, know-how or other proprietary information in the event of any unauthorized use or disclosure. Further,
our business may be adversely affected by competitors who independently develop competing technologies, especially if we obtain
no, or only narrow, patent protection.
We
may be unable to protect our patents and proprietary rights
.
Our
future success will depend to a significant extent on our ability to:
●
obtain
                                         and keep patent protection for our products and technologies on an international basis;
●
enforce
                                         our patents to prevent others from using our inventions;
●
maintain and prevent others from
                                    using our trade secrets; and
●
operate and commercialize products
                                    without infringing on the patents or proprietary rights of others.
We
can provide no assurance that our patent rights will afford any competitive advantages and these rights may be challenged or circumvented
by third parties. Further, patents may not be issued on any of our pending patent applications in the U.S. or abroad. Because
of the extensive time required for development, testing and regulatory review of a product candidate, it is possible that before
a product candidate can be commercialized, any related patent may expire, or remain in existence for only a short period following
commercialization, reducing or eliminating any advantage of the patent.
If
we sue others for infringing our patents, a court may determine that such patents are invalid or unenforceable. Even if the validity
of our patent rights is upheld by a court, a court may not prevent the alleged infringement of our patent rights on the grounds
that such activity is not covered by our patent claims.
In
addition, third parties may sue us for infringing their patents. In the event of a successful claim of infringement against us,
we may be required to:
●
defend litigation or administrative
                                    proceedings;
●
pay substantial damages;
●
stop using our technologies and
                                    methods;
●
stop certain research and development
                             efforts;
●
develop non-infringing products or methods;
                             and
●
obtain
                                         one or more licenses from third parties.
If
required, we can provide no assurance that we will be able to obtain such licenses on acceptable terms, or at all. If we are sued
for infringement, we could encounter substantial delays in development, manufacture and commercialization of our product candidates.
Any litigation, whether to enforce our patent rights or to defend against allegations that we infringe third-party rights, will
be costly, time consuming, and may distract management from other important tasks.
10
As
is commonplace in the biotechnology and pharmaceutical industry, we employ individuals who were previously employed at other biotechnology
or pharmaceutical companies, including our competitors or potential competitors. To the extent our employees are involved in research
areas which are similar to those areas in which they were involved at their former employers, we may be subject to claims that
such employees and/or we have inadvertently or otherwise used or disclosed the alleged trade secrets or other proprietary information
of the former employers. Litigation may be necessary to defend against such claims, which could result in substantial costs and
be a distraction to management and which may have a material adverse effect on us, even if we are successful in defending such
claims.
We
are subject to various government regulations.
The
manufacture and sale of human therapeutic and diagnostic products in the U.S., Canada and foreign jurisdictions are governed by
a variety of statutes and regulations. These laws require approval of manufacturing facilities, controlled research and testing
of products and government review and approval of a submission containing manufacturing, preclinical and clinical data in order
to obtain marketing approval based on establishing the safety and efficacy of the product for each use sought, including adherence
to current cGMP during production and storage, and control of marketing activities, including advertising and labeling.
VAL-083
and any other products we may develop will require significant development, preclinical and clinical testing and investment of
substantial funds prior to its commercialization. The process of obtaining required approvals can be costly and time-consuming,
and there can be no assurance that we will successfully develop any future products that will prove to be safe and effective in
clinical studies or receive applicable regulatory approvals. Markets other than the U.S. and Canada have similar restrictions.
Potential investors and shareholders should be aware of the risks, problems, delays, expenses and difficulties which we may encounter
in view of the extensive regulatory environment which controls our business.
We
may request priority review for our product candidate in the future. The FDA may not grant priority review for our product candidate.
Moreover, even if the FDA designated such product for priority review, that designation may not lead to a faster regulatory review
or approval process and, in any event, would not assure FDA approval.
We
may be eligible for priority review designation for our product candidate if the FDA determines such product candidate offers
major advances in treatment or provides a treatment where no adequate therapy exists. A priority review designation means that
the goal for the FDA to review an application is six months, rather than the standard review period of ten months. The FDA has
broad discretion with respect to whether or not to grant priority review status to a product candidate, so even if we believe
a particular product candidate is eligible for such designation or status, the FDA may decide not to grant it. Thus, while the
FDA has granted priority review to other oncology disease products, our product candidate, should we determine to seek priority
review, may not receive similar designation. Moreover, even if our product candidate is designated for priority review, such a
designation does not necessarily mean a faster regulatory review process or necessarily confer any advantage with respect to approval
compared to conventional FDA procedures. Receiving priority review from the FDA does not guarantee approval within an accelerated
timeline or thereafter.
We
believe we may in some instances be able to secure approval from the FDA or comparable non-U.S. regulatory authorities to use
accelerated development pathways. If we are unable to obtain such approval, we may be required to conduct additional preclinical
studies or clinical studies beyond those that we contemplate, which could increase the expense of obtaining, and delay the receipt
of, necessary marketing approvals.
We
anticipate that we may seek an accelerated approval pathway for our product candidate. Under the accelerated approval provisions
in the Federal Food, Drug, and Cosmetic Act, or FDCA, and the FDA's implementing regulations, the FDA may grant accelerated
approval to a product designed to treat a serious or life-threatening condition that provides meaningful therapeutic benefit over
available therapies upon a determination that the product has an effect on a surrogate endpoint or intermediate clinical endpoint
that is reasonably likely to predict clinical benefit. The FDA considers a clinical benefit to be a positive therapeutic effect
that is clinically meaningful in the context of a given disease, such as irreversible morbidity or mortality. For the purposes
of accelerated approval, a surrogate endpoint is a marker, such as a laboratory measurement, radiographic image, physical sign,
or other measure that is thought to predict clinical benefit, but is not itself a measure of clinical benefit. An intermediate
clinical endpoint is a clinical endpoint that can be measured earlier than an effect on irreversible morbidity or mortality that
is reasonably likely to predict an effect on irreversible morbidity or mortality or other clinical benefit. The accelerated approval
pathway may be used in cases in which the advantage of a new drug over available therapy may not be a direct therapeutic advantage,
but is a clinically important improvement from a patient and public health perspective. If granted, accelerated approval is usually
contingent on the sponsor's agreement to conduct, in a diligent manner, additional post-approval confirmatory studies to
verify and describe the drug's clinical benefit. If such post-approval studies fail to confirm the drug's clinical
benefit, the FDA may withdraw its approval of the drug.
Prior
to seeking such accelerated approval, we will seek feedback from the FDA and will otherwise evaluate our ability to seek and receive
such accelerated approval. There can also be no assurance that after our evaluation of the feedback and other factors we will
decide to pursue or submit a New Drug Application ("NDA"), for accelerated approval or any other form of expedited
development, review or approval. Similarly, there can be no assurance that after subsequent FDA feedback that we will continue
to pursue or apply for accelerated approval or any other form of expedited development, review or approval, even if we initially
decide to do so. Furthermore, if we decide to submit an application for accelerated approval or under another expedited regulatory
designation (e.g., breakthrough therapy designation), there can be no assurance that such submission or application will be accepted
or that any expedited development, review or approval will be granted on a timely basis, or at all. The FDA or other non-U.S.
authorities could also require us to conduct further studies prior to considering our application or granting approval of any
type. A failure to obtain accelerated approval or any other form of expedited development, review or approval for any of our product
candidates that we determine to seek accelerated approval for would result in a longer time period to commercialization of such
product candidate, could increase the cost of development of such product candidate and could harm our competitive position in
the marketplace.
11
We
have conducted, and may in the future conduct, clinical studies for certain of our product candidates at sites outside the United
States, and the FDA may not accept data from studies conducted in such locations.
We
have conducted and may in the future choose to conduct one or more of our clinical studies outside the United States. Although
the FDA may accept data from clinical studies conducted outside the United States, acceptance of this data is subject to certain
conditions imposed by the FDA. For example, the clinical study must be well designed and conducted and performed by qualified
investigators in accordance with ethical principles. The study population must also adequately represent the U.S. population,
and the data must be applicable to the U.S. population and U.S. medical practice in ways that the FDA deems clinically meaningful.
Generally, the patient population for any clinical studies conducted outside of the United States must be representative of the
population for whom we intend to seek approval in the United States. In addition, while these clinical studies are subject to
the applicable local laws, FDA acceptance of the data will be dependent upon its determination that the studies also complied
with all applicable U.S. laws and regulations. There can be no assurance that the FDA will accept data from studies conducted
outside of the United States. If the FDA does not accept the data from any of our clinical studies that we determine to conduct
outside the United States, it would likely result in the need for additional studies, which would be costly and time-consuming
and delay or permanently halt our development of the product candidate.
In
addition, the conduct of clinical studies outside the United States could have a significant impact on us. Risks inherent in conducting
international clinical studies include:
●
foreign regulatory requirements that could restrict or
limit our ability to conduct our clinical studies;
●
administrative burdens of conducting clinical studies under
multiple foreign regulatory schema;
●
foreign exchange fluctuations; and
●
diminished protection of intellectual property in some
countries.
If
our clinical studies fail to demonstrate safety and efficacy to the satisfaction of the FDA and comparable non-U.S. regulators,
we may incur additional costs or experience delays in completing, or ultimately be unable to complete, the development and commercialization
of our product candidate.
We
are not permitted to commercialize, market, promote or sell any product candidate in the United States without obtaining marketing
approval from the FDA. Comparable non-U.S. regulatory authorities, such as the EMA, impose similar restrictions. We may never
receive such approvals. We must complete extensive preclinical development and clinical studies to demonstrate the safety and
efficacy of our product candidate 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 have not previously submitted an NDA to the FDA or similar drug approval filings to comparable non-U.S. regulatory authorities
for any product candidate.
Any
inability to successfully complete preclinical and clinical development could result in additional costs to us and impair our
ability to generate revenues from product sales, regulatory and commercialization milestones and royalties. In addition, if (1)
we are required to conduct additional clinical studies or other testing of our product candidate beyond the studies and testing
that we contemplate, (2) we are unable to successfully complete clinical studies of our product candidate or other testing, (3)
the results of these studies or tests are unfavorable, uncertain or are only modestly favorable, or (4) there are unacceptable
safety concerns associated with our product candidate, we, in addition to incurring additional costs, may:
●
be
delayed in obtaining marketing approval for our product candidates;
●
not
obtain marketing approval at all;
●
obtain
approval for indications or patient populations that are not as broad as we intended or desired;
●
obtain
approval with labeling that includes significant use or distribution restrictions or significant safety warnings, including boxed
warnings;
●
be
subject to additional post-marketing testing or other requirements; or
●
be
required to remove the product from the market after obtaining marketing approval.
If
we experience any of a number of possible unforeseen events in connection with clinical studies of our product candidates, potential
marketing approval or commercialization of our product candidates could be delayed or prevented.
We
may experience numerous unforeseen events during, or as a result of, clinical studies that could delay or prevent marketing approval
of our product candidate, including:
●
clinical studies of our product
                                    candidate may produce unfavorable or inconclusive results;
12
●
we may decide, or regulators may require
                             us, to conduct additional clinical studies or abandon product development programs;
●
the number of patients required
                                    for clinical studies of our product candidate may be larger than we anticipate, patient enrollment
                                    in these clinical studies may be slower than we anticipate or participants may drop out of
                                    these clinical studies at a higher rate than we anticipate;
●
data safety monitoring committees may
                             recommend suspension, termination or a clinical hold for various reasons, including concerns about
                             patient safety;
●
regulators or IRBs may suspend
                                    or terminate the study or impose a clinical hold for various reasons, including noncompliance
                                    with regulatory requirements or concerns about patient safety;
●
patients with serious, life-threatening
                             diseases included in our clinical studies may die or suffer other adverse medical events for reasons
                             that may not be related to our product candidate;
●
participating patients may be
                                    subject to unacceptable health risks;
●
patients may not complete clinical studies
                             due to safety issues, side effects, or other reasons;
●
changes in regulatory requirements and
                             guidance may occur, which require us to amend clinical study protocols to reflect these changes;
●
our third-party contractors, including
                             those manufacturing our product candidate or components or ingredients thereof or conducting clinical
                             studies on our behalf, may fail to comply with regulatory requirements or meet their contractual
                             obligations to us in a timely manner or at all;
●
regulators or institutional review boards,
                             or IRBs may not authorize us or our investigators to commence a clinical study or conduct a clinical
                             study at a prospective study site;
●
we may experience delays in reaching
                             or fail to reach agreement on acceptable clinical study contracts or clinical study protocols with
                             prospective study sites;
●
patients who enroll in a clinical
                                    study may misrepresent their eligibility to do so or may otherwise not comply with the clinical
                                    study protocol, resulting in the need to drop the patients from the clinical study, increase
                                    the needed enrollment size for the clinical study or extend the clinical study's duration;
●
we may have to suspend or terminate
                             clinical studies of our product candidate for various reasons, including a finding that the participants
                             are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics
                             of a product candidate;
●
regulators or IRBs may require that
                             we or our investigators suspend or terminate clinical research for various reasons, including noncompliance
                             with regulatory requirements or their respective standards of conduct, a finding that the participants
                             are being exposed to unacceptable health risks, undesirable side effects or other unexpected characteristics
                             of the product candidate or findings of undesirable effects caused by a chemically or mechanistically
                             similar drug or drug candidate;
●
the FDA or comparable non-U.S. regulatory
                             authorities may fail to approve or subsequently find fault with the manufacturing processes or facilities
                             of third-party manufacturers with which we enter into agreements for clinical and commercial supplies;
●
the FDA or comparable non-U.S.
                                    regulatory authorities may disagree with our clinical study design or our interpretation of
                                    data from preclinical studies and clinical studies;
●
the supply or quality of raw materials
                             or manufactured product candidate or other materials necessary to conduct clinical studies of our
                             product candidate may be insufficient, inadequate, delayed, or not available at an acceptable cost,
                             or we may experience interruptions in supply; and
●
the approval policies or regulations
                                    of the FDA or comparable non-U.S. regulatory authorities may significantly change in a manner
                                    rendering our clinical data insufficient to obtain marketing approval.
Product
development costs for us will increase if we experience delays in testing or pursuing marketing approvals and we may be required
to obtain additional funds to complete clinical studies and prepare for possible commercialization of our product candidate. We
do not know whether any preclinical tests or clinical studies will begin as planned, will need to be restructured or will be completed
on schedule, or at all. Significant preclinical or clinical study delays also could shorten any periods during which we may have
the exclusive right to commercialize our product candidate or allow our competitors to bring products to market before we do and
impair our ability to successfully commercialize our product candidate and may harm our business and results of operations. In
addition, many of the factors that cause, or lead to, clinical study delays may ultimately lead to the denial of marketing approval
of our product candidate.
13
If
we experience delays or difficulties in the enrollment of patients in clinical studies, we may not achieve our clinical development
on our anticipated timeline, or at all, and our receipt of necessary regulatory approvals could be delayed or prevented.
We
may not be able to initiate or continue clinical studies for VAL-083 or any other product candidate if we are unable to locate
and enroll a sufficient number of eligible patients to participate in clinical studies. Patient enrollment is a significant factor
in the timing of clinical studies, and is affected by many factors, including:
●
the size and nature of the patient population;
●
the
                                         severity of the disease under investigation;
●
the proximity of patients to clinical
                             sites;
●
the eligibility criteria for the study;
●
the design of the clinical study;
●
efforts to facilitate timely
                                    enrollment;
●
competing clinical studies; and
●
clinicians' and patients'
                                    perceptions as to the potential advantages and risks of the drug being studied in relation
                                    to other available therapies, including any new drugs that may be approved for the indications
                                    we are investigating.
Our
inability to enroll a sufficient number of patients for our clinical studies could result in significant delays or may require
us to abandon one or more clinical studies altogether. Enrollment delays in our clinical studies may result in increased development
costs for our product candidate, delay or halt the development of and approval processes for our product candidate and jeopardize
our ability to achieve our clinical development timeline and goals, including the dates by which we will commence, complete and
receive results from clinical studies. Enrollment delays may also delay or jeopardize our ability to commence sales and generate
revenues from our product candidate. Any of the foregoing could cause our value to decline and limit our ability to obtain additional
financing, if needed.
Positive
results in previous clinical studies of VAL-083 may not be replicated in future clinical studies, which could result in development
delays or a failure to obtain marketing approval.
Positive
results in previous clinical studies of VAL-083 may not be predictive of similar results in future clinical studies. Also, interim
results during a clinical study do not necessarily predict final results. A number of companies in the pharmaceutical and biotechnology
industries have suffered significant setbacks in late-stage clinical studies even after achieving promising results in early-stage
development. Accordingly, the results from the completed preclinical studies and clinical studies for VAL-083 may not be predictive
of the results we may obtain in later stage studies. Our clinical studies may produce negative or inconclusive results, and we
may decide, or regulators may require us, to conduct additional clinical studies. Moreover, clinical data are often susceptible
to varying interpretations and analyses, and many companies that believed their product candidates performed satisfactorily in
preclinical studies and clinical studies have nonetheless failed to obtain FDA or EMA, or other regulatory agency, approval for
their products.
FDA
approval of VAL-083 or future product candidates may be denied.
There
can be no assurance that the FDA will ultimately approve our NDA. The FDA may deny approval of VAL-083 for many reasons, including:
●
we may be unable to demonstrate
                                    to the satisfaction of the FDA that our products are safe and effective for its intended uses;
●
the FDA may disagree with our
                                    interpretation of data from the clinical studies;
●
we may be unable to demonstrate that
                             any clinical or other benefits our products outweigh any safety or other perceived risks; or
●
we may not be able to successfully
                                    address any other issues raised by the FDA.
If
VAL-083 fails to receive FDA approval, our business and prospects will be materially adversely impacted.
We
expect to rely on orphan drug status to develop and commercialize our product candidate, but our orphan drug designations may
not confer marketing exclusivity or other expected commercial benefits as anticipated.
Market
exclusivity afforded by orphan drug designation is generally offered as an incentive to drug developers to invest in developing
and commercializing products for unique diseases that impact a limited number of patients. The FDA may grant orphan drug designation
to drugs intended to treat a rare disease or condition, which is generally a disease or condition that affects fewer than 200,000
individuals in the United States. Qualification to maintain orphan drug status is generally monitored by the regulatory authorities
during the orphan drug exclusivity period, currently seven years from the date of approval in the United States.
14
We
have been granted orphan drug designation in the United States for GBM, ovarian cancer, and medulloblastoma, and in Europe for
GBM. We expect to rely on orphan drug exclusivity for our product candidate. It is possible that the incidence and prevalence
numbers for GBM could change. Should the incidence and prevalence of GBM patients materially increase, it is possible that the
orphan drug designation, and related market exclusivity, in the United States could be lost. Further, while we have been granted
this orphan designation, the FDA can still approve different drugs for use in treating the same indication or disease, which would
create a more competitive market for us and our revenues will be diminished.
Further,
it is possible that another company also holding orphan drug designation for the same product candidate will receive marketing
approval for the same indication before we do. If that were to happen, our applications for that indication may not be approved
until the competing company's period of exclusivity expires. Even if we are the first to obtain marketing authorization
for an orphan drug indication, there are circumstances under which a competing product may be approved for the same indication
during the seven-year period of marketing exclusivity, such as if the later product is shown to be clinically superior to the
orphan product, or if the later product is deemed a different product than ours. Further, the seven-year marketing exclusivity
would not prevent competitors from obtaining approval of the same product candidate as ours for indications other than those in
which we have been granted orphan drug designation, or for the use of other types of products in the same indications as our orphan
product.
If
the market opportunities for our product candidate are smaller than we believe they are, our revenues may be adversely affected
and our business may suffer. Because the target patient populations of our product candidate are small, we must be able to successfully
identify patients and capture a significant market share to achieve and maintain profitability.
We
focus our research and product development on treatments for orphan cancer indications. Our projections of both the number of
people who have failed other therapies or have limited medical options, are based on estimates. These estimates may prove to be
incorrect and new studies may change the estimated incidence or prevalence. The number of patients in the United States, Europe
and elsewhere may turn out to be lower than expected or may not be otherwise amenable to treatment with our products, or new patients
may become increasingly difficult to identify or gain access to, all of which would adversely affect our results of operations
and our business. Additionally, because our target patient populations are small, we will be required to capture a significant
market share to achieve and maintain profitability.
We
may be required to suspend or discontinue clinical studies due to unexpected side effects or other safety risks that could preclude
approval of our products.
Our
clinical studies may be suspended at any time for a number of reasons. For example, we may voluntarily suspend or terminate our
clinical studies if at any time we believe that they present an unacceptable risk to the clinical study patients. In addition,
the FDA or other regulatory agencies may order the temporary or permanent discontinuation of our clinical studies at any time
if they believe that the clinical studies are not being conducted in accordance with applicable regulatory requirements or that
they present an unacceptable safety risk to the clinical study patients.
Administering
any product candidate to humans may produce undesirable side effects. These side effects could interrupt, delay or halt clinical
studies of our product candidates and could result in the FDA or other regulatory authorities denying further development or approval
of our product candidates for any or all targeted indications. Ultimately, some or all of our product candidates may prove to
be unsafe for human use. Moreover, we could be subject to significant liability if any volunteer or patient suffers, or appears
to suffer, adverse health effects or even death as a result of participating in our clinical studies.
We
may not receive regulatory approvals for our product candidate or there may be a delay in obtaining such approvals.
Our
product and our ongoing development activities are subject to regulation by regulatory authorities in the countries in which we
or our collaborators and distributors wish to test, manufacture or market our products. For instance, the FDA will regulate the
product in the U.S. and equivalent authorities, such as the EMA, will regulate in Europe. Regulatory approval by these authorities
will be subject to the evaluation of data relating to the quality, efficacy and safety of the product for its proposed use, and
there can be no assurance that the regulatory authorities will find our data sufficient to support product approval of VAL-083
or any future product candidates.
The
time required to obtain regulatory approval varies between countries. The FDA is required to facilitate the development and expedite
the review of drugs and biologics that are intended for the treatment of a serious or life-threatening disease or condition and
which demonstrate the potential to address unmet medical needs for the condition. Filling an unmet medical need is defined as
providing a therapy where none exists or providing a therapy that may be potentially better than available therapy. Under the
fast track program, the sponsor of a new drug or biologic candidate may request the FDA to designate the product for a specific
indication as a fast track product concurrent with or after the filing of the IND for the product candidate. The FDA must determine
if the product candidate qualifies for fast track designation within 60 days after receipt of the sponsor's request. In
the U.S., for products without "Fast Track" status, it can take over eighteen (18) months after submission of an application
for product approval to receive the FDA's decision. Even with Fast Track status, FDA review and decision can take over twelve
(12) months.
In
December 2017, the FDA granted Fast Track designation for VAL-083 in rGBM.
Different
regulators may impose their own requirements and may refuse to grant, or may require additional data before granting, an approval,
notwithstanding that regulatory approval may have been granted by other regulators. Regulatory approval may be delayed, limited
or denied for a number of reasons, including insufficient clinical data, the product not meeting safety or efficacy requirements
or any relevant manufacturing processes or facilities not meeting applicable requirements as well as case load at the regulatory
agency at the time.
15
We
may fail to comply with regulatory requirements.
Our
success will be dependent upon our ability, and our collaborative partners' abilities, to maintain compliance with regulatory
requirements, including cGMP, and safety reporting obligations. The failure to comply with applicable regulatory requirements
can result in, among other things, fines, injunctions, civil penalties, total or partial suspension of regulatory approvals, refusal
to approve pending applications, recalls or seizures of products, operating and production restrictions and criminal prosecutions.
Even
if our product candidate receives marketing approval, it may fail to achieve the degree of market acceptance by physicians, patients,
third-party payors and others in the medical community necessary for commercial success and the market opportunity for the product
candidate may be smaller than we estimate.
We
have never commercialized a product. Even if VAL-083 or any other product candidate is approved by the appropriate regulatory
authorities for marketing and sale, it may nonetheless fail to gain sufficient market acceptance by physicians, patients, third-party
payors and others in the medical community. For example, physicians are often reluctant to switch their patients from existing
therapies even when new and potentially more effective or convenient treatments enter the market. Further, patients often acclimate
to the therapy that they are currently taking and do not want to switch unless their physicians recommend switching products or
they are required to switch therapies due to lack of reimbursement for existing therapies.
Efforts
to educate the medical community and third-party payors on the benefits of our product candidate may require significant resources
and may not be successful. If our product candidate is approved but does not achieve an adequate level of market acceptance, we
may not generate significant revenues and we may not become profitable. The degree of market acceptance of VAL-083 or any other
product candidate, if approved for commercial sale, will depend on a number of factors, including:
●
the efficacy and safety of the
                                    product;
●
the potential advantages of the product
                             compared to alternative treatments;
●
the prevalence and severity of any side
                             effects;
●
the clinical indications for
                                    which the product is approved;
●
whether the product is designated
                                    under physician treatment guidelines as a first-line therapy or as a second- or third-line
                                    therapy;
●
limitations or warnings, including distribution
                             or use restrictions, contained in the product's approved labeling;
●
our ability to offer the product for
                             sale at competitive prices;
●
our ability to establish and maintain
                             pricing sufficient to realize a meaningful return on our investment;
●
the product's convenience
                                    and ease of administration compared to alternative treatments;
●
the willingness of the target
                                    patient population to try, and of physicians to prescribe, the product;
●
the strength of sales, marketing and
                             distribution support;
●
the approval of other new products
                                    for the same indications;
●
changes in the standard of care for
                             the targeted indications for the product;
●
the
                                         timing of market introduction of our approved products as well as competitive products
                                         and other therapies;
●
availability and amount of reimbursement
                             from government payors, managed care plans and other third-party payors;
●
adverse publicity about the product
                                    or favorable publicity about competitive products; and
●
potential product liability claims.
16
The
potential market opportunities for our product candidate are difficult to estimate precisely. Our estimates of the potential market
opportunities are predicated on many assumptions, including industry knowledge and publications, third-party research reports
and other surveys. While we believe that our internal assumptions are reasonable, these assumptions involve the exercise of significant
judgment on the part of our management, are inherently uncertain and the reasonableness of these assumptions has not been assessed
by an independent source. If any of the assumptions proves to be inaccurate, the actual markets for our product candidate could
be smaller than our estimates of the potential market opportunities.
If
our product candidate receives marketing approval and we, or others, later discover that the drug is less effective than previously
believed or causes undesirable side effects that were not previously identified, our ability to market the drug could be compromised.
Clinical
studies of our product candidate are conducted in carefully defined subsets of patients who have agreed to enter into clinical
studies. Consequently, it is possible that our clinical studies may indicate an apparent positive effect of a product candidate
that is greater than the actual positive effect, if any, or alternatively fail to identify undesirable side effects. If, following
approval of our product candidate, we, or others, discover that the drug is less effective than previously believed or causes
undesirable side effects that were not previously identified, any of the following adverse events could occur:
●
regulatory authorities may withdraw
                             their approval of the drug or seize the drug;
●
we may be required to recall the drug
                             or change the way the drug is administered;
●
additional restrictions may be
                                    imposed on the marketing of, or the manufacturing processes for, the particular drug;
●
we may be subject to fines, injunctions
                             or the imposition of civil or criminal penalties;
●
regulatory authorities may require
                                    the addition of labeling statements, such as a "black box" warning or a contraindication;
●
we may be required to create a Medication
                             Guide outlining the risks of the previously unidentified side effects for distribution to patients;
●
we could be sued and held liable
                                    for harm caused to patients;
●
the drug may become less competitive;
                             and
●
our reputation may suffer.
Any
of these events could have a material and adverse effect on our operations and business and could adversely impact our stock price.
17
Any
product candidate for which we obtain marketing approval, along with the manufacturing processes, qualification testing, post-approval
clinical data, labeling and promotional activities for such product, will be subject to continual and additional requirements
of the FDA and other regulatory authorities.
These
requirements include submissions of safety and other post-marketing information, reports, registration and listing requirements,
good manufacturing practices, or GMP requirements relating to quality control, quality assurance and corresponding maintenance
of records and documents, and recordkeeping. Even if marketing approval of our product candidate is granted, the approval may
be subject to limitations on the indicated uses for which the product may be marketed or to conditions of approval, or contain
requirements for costly post-marketing testing and surveillance to monitor the safety or efficacy of the product. The FDA closely
regulates the post-approval marketing and promotion of pharmaceutical products to ensure such products are marketed only for the
approved indications and in accordance with the provisions of the approved labeling.
In
addition, later discovery of previously unknown problems with our products, manufacturing processes, or failure to comply with
regulatory requirements, may lead to various adverse results, including:
●
restrictions on such products,
                                    manufacturers or manufacturing processes;
●
restrictions on the labeling or marketing
                             of a product;
●
restrictions on product distribution
                             or use;
●
requirements to conduct post-marketing
                             clinical studies;
●
requirements to institute a risk evaluation
                             mitigation strategy, or REMS, to monitor safety of the product post-approval;
●
warning letters issued by the FDA or
                             other regulatory authorities;
●
withdrawal of the products from the
                             market;
●
refusal to approve pending applications
                             or supplements to approved applications that we submit;
●
recall of products, fines, restitution
                                    or disgorgement of profits or revenue;
●
suspension, revocation or withdrawal
                                    of marketing approvals;
●
refusal to permit the import
                                    or export of our products; and
●
injunctions or the imposition of civil
                             or criminal penalties.
If
we are unable to establish sales, marketing and distribution capabilities or enter into acceptable sales, marketing and distribution
arrangements with third parties, we may not be successful in commercializing any product candidates that we develop, if and when
those product candidates are approved.
We
do not have a sales, marketing or distribution infrastructure and have limited experience in the sale, marketing or distribution
of pharmaceutical products. To achieve commercial success for any approved product, we must either develop a sales and marketing
organization, outsource these functions to third parties, or license our product candidates to others. If approved, we may seek
to license VAL-083 to a large pharmaceutical company with greater resources and experience than us. We may not be able license
the VAL-083 on reasonable terms, if at all. The development of sales, marketing and distribution capabilities will require substantial
resources, will be time-consuming and could delay any product launch. We expect that we will commence the development of these
capabilities prior to receiving approval of our product candidate. If the commercial launch of a product candidate for which we
recruit a sales force and establish marketing and distribution capabilities is delayed or does not occur for any reason, we could
have prematurely or unnecessarily incurred these commercialization costs. Such a delay may be costly, and our investment could
be lost if we cannot retain or reposition our sales and marketing personnel. In addition, we may not be able to hire or retain
a sales force in the United States that is sufficient in size or has adequate expertise in the medical markets that we plan to
target. If we are unable to establish or retain a sales force and marketing and distribution capabilities, our operating results
may be adversely affected. If a potential partner has development or commercialization expertise that we believe is particularly
relevant to our product candidate, then we may seek to collaborate with that potential partner even if we believe we could otherwise
develop and commercialize the product independently.
18
We
expect to seek one or more strategic partners for commercialization of our product candidate outside the United States. As a result
of entering into arrangements with third parties to perform sales, marketing and distribution services, our product revenues or
the profitability of these product revenues may be lower, perhaps substantially lower, than if we were to directly market and
sell products in those markets. Furthermore, we may be unsuccessful in entering into the necessary arrangements with third parties
or may be unable to do so on terms that are favorable to us. In addition, we may have little or no control over such third parties,
and any of them may fail to devote the necessary resources and attention to sell and market our products effectively.
If
we do not establish sales and marketing capabilities, either on our own or in collaboration with third parties, we will not be
successful in commercializing our product candidate.
We
face substantial competition from other pharmaceutical and biotechnology companies and our operating results may suffer if we
fail to compete effectively.
The
development and commercialization of new drug products is highly competitive. We expect that we will face significant competition
from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide with respect to
VAL-083 and any other product candidates that we may seek to develop or commercialize in the future. Specifically, due to the
large unmet medical need, global demographics and relatively attractive reimbursement dynamics, the oncology market is fiercely
competitive and there are a number of large pharmaceutical and biotechnology companies that currently market and sell products
or are pursuing the development of product candidates for the treatment of cancer. Our competitors may succeed in developing,
acquiring or licensing technologies and drug products that are more effective, have fewer or more tolerable side effects or are
less costly than any product candidates that we are currently developing or that we may develop, which could render our product
candidates obsolete and noncompetitive.
All
of the top ten global pharmaceutical companies and many of the mid-size pharmaceutical companies have a strong research and development
and commercial presence in oncology. Smaller companies also focus on oncology, including companies such as ARIAD Pharmaceuticals,
Inc., Agios Pharmaceuticals, Inc., BIND Therapeutics, Inc., Clovis Oncology, Inc., Endocyte, Inc., Epizyme, Inc., ImmunoGen, Inc.,
Incyte Corporation, Infinity Pharmaceuticals, Inc., MacroGenics, Inc., Merrimack Pharmaceuticals, Inc., OncoMed Pharmaceuticals,
Inc., Onconova Therapeutics, Inc., Pharmacyclics, Inc., Puma Biotechnology, Inc., Seattle Genetics, Inc. and TESARO, Inc.
Several
companies are marketing and developing oncology immunotherapy products. Companies with approved marketed oncology products for
GBM are Merck (Temodar
®
) and Genentech (Avastin
®
). Companies with oncology immunotherapy product
candidates in clinical development include, but are not limited to, Northwest Biotherapeutics (DCVax-L), Celldex Therapeutics
(Rindopepimut (CDX-110)) and ImmunoCellular Therapeutics (ICT-107).
Our
commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more
effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
Our competitors also may obtain FDA or other marketing approval for their products before we are able to obtain approval for ours,
which could result in our competitors establishing a strong market position before we are able to enter the market.
Many
of our existing and potential future competitors have significantly greater financial resources and expertise in research and
development, manufacturing, preclinical testing, conducting clinical studies, obtaining marketing approvals and marketing approved
products than we do. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources
being concentrated among a smaller number of our competitors. Smaller or early stage companies may also prove to be significant
competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete
with us in recruiting and retaining qualified scientific and management personnel and establishing clinical study sites and patient
registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our programs.
If
we are unable to or delayed in obtaining state regulatory licenses for the distribution of our product, we would not be able to
sell our product candidate.
The
majority of states require manufacturer and/or wholesaler licenses for the sale and distribution of drugs into that state. The
application process is complicated, time consuming and requires dedicated personnel or a third-party to oversee and manage. If
we are delayed in obtaining these state licenses, or denied the licenses, even with FDA approval, we would not be able to sell
or ship product into that state which would adversely affect our sales and revenues.
19
We
rely on key personnel and, if we are unable to retain or motivate key personnel or hire qualified personnel, we may not be able
to grow effectively.
We
are dependent on certain members of our management, scientific and drug development staff and consultants, the loss of services
of one or more of whom could materially adversely affect us.
We
currently have two full-time employees, and retain the services of approximately 15 persons on an independent contractor/consultant
and contract-employment basis. Our ability to manage growth effectively will require us to continue to implement and improve our
management systems and to recruit and train new employees. Although we have done so in the past and expect to do so in the future,
there can be no assurance that we will be able to successfully attract and retain skilled and experienced personnel.
Our
success depends in large part upon our ability to attract and retain highly qualified personnel. We compete in our hiring efforts
with other pharmaceutical and biotechnology companies, as well as universities and nonprofit research organizations, and we may
have to pay higher salaries to attract and retain personnel, which would be very costly.
We
may be subject to foreign exchange fluctuation.
Our
functional and reporting currency is the United States dollar. We maintain bank accounts in United States and Canadian dollars.
A portion of our expenditures are in foreign currencies, most notably in Canadian dollars, and therefore we are subject to foreign
currency fluctuations, which may, from time to time, impact our financial position and results. We may enter into hedging arrangements
under specific circumstances, typically through the use of forward or futures currency contracts, to minimize the impact of increases
in the value of the Canadian dollar. In order to minimize our exposure to foreign exchange fluctuations we may hold sufficient
Canadian dollars to cover our expected Canadian dollar expenditures.
Product
liability lawsuits against us could divert our resources, cause us to incur substantial liabilities and limit commercialization
of any products that we may develop.
We
face an inherent risk of product liability claims as a result of the clinical testing of our product candidate despite obtaining
appropriate informed consents from our clinical study participants. We will face an even greater risk if we commercially sell
any product that we may develop. For example, we may be sued if any product we develop allegedly causes injury or is found to
be otherwise unsuitable during clinical testing, manufacturing, marketing or sale. Any such product liability claims may include
allegations of defects in manufacturing, defects in design, a failure to warn of dangers inherent in the product, negligence,
strict liability or a breach of warranties. Claims could also be asserted under state consumer protection acts. If we cannot successfully
defend ourselves against product liability claims, we may incur substantial liabilities or be required to limit commercialization
of our product candidate. Regardless of the merits or eventual outcome, liability claims may result in:
●
decreased demand for our product candidate
                             or products that we may develop;
●
injury to our reputation and
                                    significant negative media attention;
●
withdrawal of clinical study
                                    participants;
●
significant costs to defend resulting
                                    litigation;
●
substantial monetary awards to study
                             participants or patients;
●
loss of revenue;
●
reduced resources of our management
                             to pursue our business strategy; and
●
the inability to commercialize
                                    any products that we may develop.
Although
we maintain general liability insurance, this insurance may not fully cover potential liabilities that we may incur. The cost
of any product liability litigation or other proceeding, even if resolved in our favor, could be substantial. We will need to
increase our insurance coverage if and when we begin selling any product candidate that receives marketing approval. In addition,
insurance coverage is becoming increasingly expensive. If we are unable to obtain or maintain sufficient insurance coverage at
an acceptable cost or to otherwise protect against potential product liability claims, it could prevent or inhibit the development
and commercial production and sale of our product candidate, which could adversely affect our business, financial condition, results
of operations and prospects.
Risks
Related to Our Dependence on Third Parties
We
rely on third parties to conduct clinical studies for our product candidate. Any failure by a third-party to meet its obligations
with respect to the clinical development of our product candidate may delay or impair our ability to obtain regulatory approval
for our product candidate.
We
rely on academic institutions and private oncology centers to conduct our clinical studies. Our reliance on third parties to conduct
clinical studies could, depending on the actions of such third parties, jeopardize the validity of the clinical data generated
and adversely affect our ability to obtain marketing approval from the FDA or other applicable regulatory authorities.
20
Such
clinical study arrangements provide us with information rights with respect to the clinical data, including access to and the
ability to use and reference the data, including for our own regulatory filings, resulting from the clinical studies. If investigators
or institutions breach their obligations with respect to the clinical studies of our product candidate, or if the data proves
to be inadequate, then our ability to design and conduct any future clinical studies may be adversely affected.
We
rely, and expect to continue to rely, on third parties to conduct our clinical studies, and those third parties may not perform
satisfactorily, including failing to meet deadlines for the completion of such studies.
We
currently rely on third-party clinical research organizations, or CROs, to conduct our clinical studies. We expect to continue
to rely on third parties, such as CROs, clinical data management organizations, medical institutions and clinical investigators,
to conduct our clinical studies. Our agreements with these third parties generally allow the third-party to terminate the agreement
at any time. If we are required to enter into alternative arrangements because of any such termination the introduction of our
product candidates to market could be delayed.
Our
reliance on these third parties for research and development activities will reduce our control over these activities but will
not relieve us of our responsibilities. For example, we design our clinical studies and will remain responsible for ensuring that
each of our clinical studies are conducted in accordance with the general investigational plan and protocols for the study. Moreover,
the FDA requires us to comply with standards, commonly referred to as good clinical practices, or GCPs, for conducting, recording
and reporting the results of clinical studies to assure that data and reported results are credible and accurate and that the
rights, integrity and confidentiality of study participants are protected. Our reliance on third parties that we do not control
does not relieve us of these responsibilities and requirements. We also are required to register ongoing clinical studies and
post the results of completed clinical studies on a government-sponsored database, ClinicalTrials.gov, within specified timeframes.
Failure to do so can result in fines, adverse publicity and civil and criminal sanctions.
Furthermore,
these third parties may also have relationships with other entities, some of which may be our competitors. If these third parties
do not successfully carry out their contractual duties, meet expected deadlines or conduct our clinical studies in accordance
with regulatory requirements or our stated protocols, we will not be able to obtain, or may be delayed in obtaining, marketing
approvals for our product candidates and will not be able to, or may be delayed in our efforts to, successfully commercialize
our product candidates.
We
also expect to rely on other third parties to store and distribute drug supplies for our clinical studies. Any performance failure
on the part of our distributors could delay clinical development or marketing approval of our product candidate or commercialization
of our products, producing additional losses and depriving us of potential product revenue.
We
may seek to enter into collaborations with third parties for the development and commercialization of our product candidate. If
we fail to enter into such collaborations, or such collaborations are not successful, we may not be able to capitalize on the
market potential of our product candidate.
We
may seek third-party collaborators for development and commercialization of our product candidate. Our likely collaborators for
any marketing, distribution, development, licensing or broader collaboration arrangements include large and mid-size pharmaceutical
companies, regional and national pharmaceutical companies, non-profit organizations, government agencies, and biotechnology companies.
We are currently party to a limited number of such arrangements and have limited control over the amount and timing of resources
that our collaborators dedicate to the development or commercialization of our product candidate. Our ability to generate revenues
from these arrangements will depend on our collaborators' abilities to successfully perform the functions assigned to them
in these arrangements.
Collaborations
involving our product candidate currently pose, and will continue to pose, the following risks to us:
●
collaborators have significant
                                    discretion in determining the efforts and resources that they will apply to these collaborations;
●
collaborators may not pursue development
                             and commercialization of our product candidate or may elect not to continue or renew development
                             or commercialization programs based on preclinical or clinical study results, changes in the collaborators'
                             strategic focus or available funding, or external factors such as an acquisition that diverts resources
                             or creates competing priorities;
●
collaborators may delay clinical studies,
                             provide insufficient funding for a clinical study program, stop a clinical study or abandon a product
                             candidate, repeat or conduct new clinical studies or require a new formulation of a product candidate
                             for clinical testing;
●
collaborators could independently
                                    develop, or develop with third parties, products that compete directly or indirectly with
                                    our product candidate if the collaborators believe that competitive products are more likely
                                    to be successfully developed or can be commercialized under terms that are more economically
                                    attractive than ours;
●
collaborators with marketing
                                    and distribution rights to one or more products may not commit sufficient resources to the
                                    marketing and distribution of such product or products;
●
collaborators may not properly maintain
                             or defend our intellectual property rights or may use our proprietary information in such a way as
                             to invite litigation that could jeopardize or invalidate our intellectual property or proprietary
                             information or expose us to potential litigation;
21
●
collaborators may infringe the intellectual
                             property rights of third parties, which may expose us to litigation and potential liability;
●
disputes may arise between the collaborators
                             and us that result in the delay or termination of the research, development or commercialization
                             of our product candidate or that result in costly litigation or arbitration that diverts management
                             attention and resources; and
●
collaborations may be terminated and,
                             if terminated, may result in a need for additional capital to pursue further development or commercialization
                             of the applicable product candidates.
Collaboration
agreements may not lead to development or commercialization of our product candidate in the most efficient manner or at all. If
a collaborator of ours were to be involved in a business combination, the continued pursuit and emphasis on our product development
or commercialization program could be delayed, diminished or terminated.
If
we are not able to establish collaborations, we may have to alter our development and commercialization plans.
Our
drug development programs and the potential commercialization of our product candidate will require substantial additional cash
to fund expenses. We may decide to collaborate with pharmaceutical and biotechnology companies for the development and potential
commercialization of our product candidate.
We
face significant competition in seeking appropriate collaborators. Whether we reach a definitive agreement for a collaboration
will depend, among other things, upon our assessment of the collaborator's resources and expertise, the terms and conditions
of the proposed collaboration and the proposed collaborator's evaluation of a number of factors. Those factors may include
the design or results of preclinical studies or clinical studies, the likelihood of approval by the FDA or similar regulatory
authorities outside the United States, the potential market for the subject product candidate, the costs and complexities of manufacturing
and delivering such product candidate to patients, the potential of competing products, the existence of uncertainty with respect
to our ownership of technology, which can exist if there is a challenge to such ownership without regard to the merits of the
challenge and industry and market conditions generally. The collaborator may also consider alternative product candidates or technologies
for similar indications that may be available to collaborate on and whether such a collaboration could be more attractive than
the one with us for our product candidate. We may also be restricted under future license agreements from entering into agreements
on certain terms with potential collaborators. Collaborations are complex and time-consuming to negotiate and document. In addition,
there have been a significant number of recent business combinations among large pharmaceutical companies that have resulted in
a reduced number of potential future collaborators.
We
may not be able to negotiate collaborations on a timely basis, on acceptable terms, or at all. If we are unable to do so, we may
have to curtail the development of our product candidate, reduce or delay its development program, delay its potential commercialization
or reduce the scope of any sales or marketing activities, or increase our expenditures and undertake development or commercialization
activities at our own expense. If we elect to increase our expenditures to fund development or commercialization activities on
our own, we may need to obtain additional capital, which may not be available to us on acceptable terms or at all. If we do not
have sufficient funds, we may not be able to further develop our product candidate or bring it to market and generate product
revenue.
We
currently manufacture our clinical supplies at a single location. Any disruption at this facility could adversely affect our business
and results of operations.
We
have engaged a single manufacturer to produce GMP active pharmaceutical ingredient and a single manufacturer to produce drug product
for our clinical studies. In addition, we have relied on our manufacturing partner, Guangxi Wuzhou Pharmaceutical Company, for
the manufacture of clinical supply of VAL-083 for our preclinical and Phase 2 clinical studies to-date. If our manufacturer's
facility were damaged or destroyed, or otherwise subject to disruption, it would require substantial lead-time to replace our
clinical supply. In such event, we would be forced to rely entirely on other third-party contract manufacturers for an indefinite
period of time. We do not currently have established relationships with any back-up manufacturers. At this time no drug product
has been manufactured by a third-party back-up manufacturer. Any disruptions or delays by our third-party manufacturers or Guangxi
Wuzhou Pharmaceutical Company or their failure to meet regulatory compliance could impair our ability to develop VAL-083, which
would adversely affect our business and results of operations.
We
rely on these third-party manufacturers to provide drug product supply for our clinical studies. There is no assurance that such
a supplier will be able to meet our needs from a technical, timing, or cost-effective manner. Our failure to enter into appropriate
agreements with such a third-party manufacturer would delay, or halt, our clinical studies.
We
may become subject to liabilities related to risks inherent in working with hazardous materials.
Our
discovery and development processes involve the controlled use of hazardous and radioactive materials. We are subject to federal,
provincial and local laws and regulations governing the use, manufacture, storage, handling and disposal of such materials and
certain waste products. Although we believe that our safety procedures for handling and disposing of such materials comply with
the standards prescribed by such laws and regulations, the risk of accidental contamination or injury from these materials cannot
be completely eliminated. In the event of such an accident, we could be held liable for any damages that result and any such liability
could exceed our resources. We are not specifically insured with respect to this liability. Although we believe that we are in
compliance in all material respects with applicable environmental laws and regulations and currently do not expect to make material
capital expenditures for environmental control facilities in the near-term, there can be no assurance that we will not be required
to incur significant costs to comply with environmental laws and regulations in the future, or that our operations, business or
assets will not be materially adversely affected by current or future environmental laws or regulations.
22
Risks
Related to Our Common Stock
The
market price of our common stock is, and is likely to continue to be, highly volatile and subject to wide fluctuations.
The
market price of our common stock is highly volatile and could be subject to wide fluctuations in response to a number of factors
that are beyond our control, including:
●
variations in our quarterly operating
                             results;
●
announcements that our revenue or income
                             are below analysts' expectations;
●
general economic slowdowns;
●
sales of large blocks of our
                                    common stock; and
●
announcements by us or our competitors
                             of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments.
Because
we became public by means of a reverse acquisition, we may not be able to attract, or maintain, the attention of brokerage firms.
Because
we became public through a "reverse acquisition", securities analysts of brokerage firms may not provide or continue
to provide coverage of us since there is little incentive to brokerage firms to recommend the purchase of our common stock. No
assurance can be given that brokerage firms will want to conduct any follow-on offerings on behalf of us in the future.
Voting
power of our shareholders is highly concentrated by insiders.
Our
officers, directors, and 5% shareholders control, either directly or indirectly, a substantial portion of our voting securities.
Therefore, our management may significantly affect the outcome of all corporate actions and decisions for an indefinite period
of time including election of directors, amendment of charter documents and approval of mergers and other significant corporate
transactions.
We
do not intend to pay dividends on our common stock for the foreseeable future.
We
have paid no dividends on our common stock to date and we do not anticipate paying any dividends to holders of our common stock
in the foreseeable future. While our future dividend policy will be based on the operating results and capital needs of the business,
we currently anticipate that any earnings will be retained to finance our future expansion and for the implementation of our business
plan. Investors should take note of the fact that a lack of a dividend can further affect the market value of our common stock,
and could significantly affect the value of any investment in us.
Our
articles of incorporation allow for our board to create new series of preferred stock without further approval by our stockholders,
which could adversely affect the rights of the holders of our common stock.
Our
Board of Directors has the authority to fix and determine the relative rights and preferences of preferred stock. Our Board of
Directors has the authority to issue up to 5,000,000 shares of our preferred stock (of which 1 share has been designated Special
Voting Preferred Stock and is issued and outstanding, 278,530 shares have been designated Series A Preferred Stock and are issued
and outstanding, and 1,000,000 shares have been designated as Series B Preferred Stock, of which 673,613 shares are issued and
outstanding, as of June 6, 2019) without further stockholder approval. As a result, our Board of Directors could authorize the
issuance of additional series of preferred stock that would grant to holders the preferred right to our assets upon liquidation,
the right to receive dividend payments before dividends are distributed to the holders of common stock and the right to the redemption
of the shares, together with a premium, prior to the redemption of our common stock. In addition, our Board of Directors could
authorize the issuance of a series of preferred stock that has greater voting power than our common stock or that is convertible
into our common stock, which could decrease the relative voting power of our common stock or result in dilution to our existing
stockholders. Although we have no present intention to issue any additional shares of preferred stock or to create any additional
series of preferred stock, we may issue such shares in the future.
Our
issuance of common stock upon exercise of warrants, Performance Share Units, or options, exchange of Exchangeable Shares, or conversion
of Series B Preferred Stock may depress the price of our common stock.
As
of June 15, 2019, we had 3,827,259 shares of common stock issued and outstanding, 7,813 shares of common stock issuable upon exchange
of the Exchangeable Shares of Exchangeco (which entitle the holder to require Exchangeco to redeem (or, at the option of us or
Callco, to have us or Callco purchase) the Exchangeable Shares, and upon such redemption or purchase to receive an equal number
of shares of our common stock) (the Exchangeable Shares are recognized on an as-exchanged for common stock basis for financial
statement purposes), outstanding warrants to purchase 1,669,803 shares of common stock, outstanding Series B convertible preferred
shares that are convertible into 168,427 shares of common stock and outstanding options to purchase 292,683 shares of common stock.
All Exchangeable Shares, warrants, and options are convertible or exercisable into one share of common stock. Each share of Series
B preferred stock is convertible into 0.25 shares of common stock. The issuance of shares of common stock upon exercise of outstanding
warrants or options or exchange of Exchangeable Shares could result in substantial dilution to our stockholders, which may have
a negative effect on the price of our common stock.
23
FORWARD-LOOKING
STATEMENTS
This
prospectus and the documents incorporated herein by reference contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are based on our management's current beliefs, expectations and
assumptions about future events, conditions and results and on information currently available to us. Discussions containing these
forward-looking statements may be found, among other places, in the Sections entitled "Business," "Risk Factors"
and "Management's Discussion and Analysis of Financial Condition and Results of Operations".
All
statements, other than statements of historical fact, included regarding our strategy, future operations, financial position,
future revenues, projected costs, plans, prospects and objectives are forward-looking statements. Words such as "expect,"
"anticipate," "intend," "plan," "believe," "seek," "estimate,"
"think," "may," "could," "will," "would," "should," "continue,"
"potential," "likely," "opportunity" and similar expressions or variations of such words are
intended to identify forward-looking statements but are not the exclusive means of identifying forward-looking statements. Examples
of our forward-looking statements include:
●
our ability to raise funds for
                                    general corporate purposes and operations, including our research activities and clinical
                                    trials;
●
our ability to recruit qualified
                                    management and technical personnel;
●
the success of our clinical trials;
●
our ability to expand our international
                                    business;
●
our ability to obtain and maintain required
                             regulatory approvals for our products;
●
our expectations regarding the
                                    use of our existing cash and the expected net proceeds of this offering;
●
our ability to obtain or maintain patents
                             or other appropriate protection for the intellectual property utilized in our current and planned
                             products; and
●
the other factors discussed in
                                    the "Risk Factors" section and elsewhere in this prospectus.
Because
forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified
and some of which are beyond our control, you should not rely on these forward-looking statements as predictions of future events.
The events and circumstances reflected in our forward-looking statements may not be achieved or occur and actual results could
differ materially from those projected in the forward-looking statements. Moreover, we operate in an evolving environment. New
risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors
and uncertainties. Except as required by applicable law, we do not plan to publicly update or revise any forward-looking statements
contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.
This
prospectus and the documents incorporated herein by reference also refer to estimates and other statistical data made by independent
parties and by us relating to market size and growth and other data about our industry. This data involves a number of assumptions
and limitations, and you are cautioned not to give undue weight to such estimates. In addition, projections, assumptions and estimates
of our future performance and the future performance of the markets in which we operate are necessarily subject to a high degree
of uncertainty and risk.
24
USE
OF PROCEEDS
We
will not receive any proceeds from the sale of the shares of our common stock previously issued and issuable upon exercise of
the warrants to purchase shares of our common stock by the selling stockholders from time to time pursuant to this prospectus.
The proceeds from the offering are solely for the account of the selling stockholders. See "Selling Stockholders."
We
will, however, receive proceeds from any cash exercise of the warrants. If the warrants were exercised in cash with respect to
all of the 760,500 shares of common stock offered hereby, we would receive gross proceeds of approximately $2.36 million, subject
to certain anti-dilution provisions. We cannot predict when or if the warrants will be exercised, and it is possible that the
warrants may expire and never be exercised.
Any
net proceeds received by us from the exercise of the warrants will be used for our clinical trials and for general corporate purposes,
which may include working capital, capital expenditures, research and development and other commercial expenditures. In addition,
we may use the net proceeds from the exercise of the warrants for investments in businesses, products or technologies that are
complementary to our business, although we have no present commitments or agreements to make any such investments as of the date
of this prospectus. Pending these uses, we intend to invest the funds in short-term, investment grade, interest-bearing securities.
It is possible that, pending their use, we may invest the net proceeds in a way that does not yield a favorable, or any, return
for us.
Our
management will have broad discretion as to the allocation of the net proceeds from the exercise of the warrants, if any, and
could use them for purposes other than those contemplated at the time of commencement of this offering.
25
MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This
Management's Discussion and Analysis ("MD&A") contains "forward-looking statements", within
the meaning of the Private Securities Litigation Reform Act of 1995, which represent our projections, estimates, expectations,
or beliefs concerning, among other things, financial items that relate to management's future plans or objectives or to
our future economic and financial performance. In some cases, you can identify these statements by terminology such as "may",
"should", "plans", "believe", "will", "anticipate", "estimate",
"expect" "project", or "intend", including their opposites or similar phrases or expressions.
You should be aware that these statements are projections or estimates as to future events and are subject to a number of factors
that may tend to influence the accuracy of the statements. These forward-looking statements should not be regarded as a representation
by us or any other person that our events or plans will be achieved. You should not unduly rely on these forward-looking statements,
which speak only as of the date of this report. Except as may be required under applicable securities laws, we undertake no obligation
to publicly revise any forward-looking statement to reflect circumstances or events after the date of this report or to reflect
the occurrence of unanticipated events.
You
should review the factors and risks we describe under "Risk Factors" and "Forward-Looking Statements"
included elsewhere in this prospectus.
Overview
We
are a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. Our
mission is to benefit patients, by developing and commercializing anti-cancer therapies for patients whose tumors exhibit features
that make them resistant to, or unlikely to respond to, currently available therapies, particularly for orphan cancer indications
where patients have failed, or are unlikely to respond to, currently available therapy.
We
are developing VAL-083, a novel, validated, DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma
multiforme ("GBM") and potentially other solid tumors, including ovarian cancer. VAL-083 is a first-in-class, small-molecule,
DNA-targeting chemotherapeutic that demonstrated activity against a range of tumor types in prior Phase 1 and Phase 2 clinical
studies sponsored by the US National Cancer Institute ("NCI"). As part of our business strategy, we leverage and build
upon these prior NCI investments and data from more than 40 NCI- Phase 1 and Phase 2 clinical studies with our own research to
identify and target unmet medical needs in modern cancer care. DNA-targeting agents are among the most successful and widely used
treatments for cancer. Their efficacy is based on the ability to bind with a cancer cell's DNA and interfere with the process
of protein production required for growth and survival of cancer cells. "First-in-class" means that VAL-083 embodies
a unique molecular structure which is not an analogue or derivative of any approved product, or product under development, for
the treatment of cancer.
Corporate
History
We
are a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. ("Berry'). Prior to a reverse acquisition
undertaken on January 25, 2013 Berry did not have any significant assets or operations. We are the parent company of Del Mar Pharmaceuticals
(BC) Ltd. ("Del Mar (BC)"), a British Columbia, Canada corporation incorporated on April 6, 2010, that is focused
on the development of drugs for the treatment of cancer. We are also the parent company to 0959454 B.C. Ltd., a British Columbia
corporation ("Callco"), and 0959456 B.C. Ltd., a British Columbia corporation ("Exchangeco"). Callco and
Exchangeco were formed to facilitate the reverse acquisition.
Results
of Operations
Comparison
of the nine months ended March 31, 2019 and March 31, 2018
Nine months ended
March 31,
2019
$
March 31,
2018
$
Change
$
Change
%
Research and development
2,702,213
5,856,197
(3,153,984
)
(54
)
General and administrative
2,796,884
2,911,538
(114,654
)
(4
)
Change in fair value of derivative liability
(852
)
(57,839
)
56,987
(99
)
Foreign exchange loss
16,754
57,406
(40,652
)
(71
)
Interest income
(49,513
)
(6,241
)
(43,272
)
693
Net loss and comprehensive loss
5,465,486
8,761,061
(3,295,575
)
Research
and Development
Research
and development expenses decreased to $2,702,213 for the nine months ended March 31, 2019 from $5,856,197 for the nine months
ended March 31, 2018. The decrease was largely attributable to a decrease in clinical development costs, personnel, preclinical
research, intellectual property and travel costs during the nine months ended March 31, 2019 compared to the nine months ended
March 31, 2018. For the nine months ended March 31, 2019 and 2018 non-cash, share-based compensation expense of $74,735 and $135,367
respectively, related to stock option expense and shares issued for services. During the nine months ended March 31, 2018, we
entered into a separation agreement with our former President and Chief Operating Officer that required the accelerated vesting
of certain stock options. The full expense of the accelerated vesting was recognized during the nine months ended March 31, 2018
resulting in a higher non-cash, share-based compensation expense for the nine months ended March 31, 2018 compared to the nine
months ended March 31, 2019.
26
Excluding
the impact of non-cash, share-based compensation expense, research and development expenses decreased to $2,627,478 during the
current period from $5,720,830 for the prior period. The decrease in clinical development costs for the nine months ended March
31, 2019 compared to the nine months ended March 31, 2018 was primarily due to the parking of our STAR-3, Phase 3 study which
was announced in February 2018. During the nine months ended March 31, 2018, we incurred significant study start-up costs. In
addition, clinical development costs were higher in the prior period compared to the current period due to the timing of certain
manufacturing activities for the production of GMP material and related stability studies. Clinical development costs can vary
significantly due to the timing of patient enrollment, how a patient reacts to treatment, and the number of treatment cycles a
patient receives.
Personnel
costs decreased during the nine months ended March 31, 2019 compared to the nine months ended March 31, 2018 primarily due to
amounts recognized pursuant to the settlement agreement with our former President and Chief Operating Officer. Preclinical research
decreased largely due to a decrease in the ongoing mechanism of action research that we have undertaken in the prior period. Intellectual
property costs decreased in the nine months ended March 31, 2019 compared to the nine months ended March 31, 2018 as we have refined
our patent portfolio by focusing on our most important patent claims in the most important jurisdictions. Patent costs can vary
considerably depending on the filing of new patents, conversion of the provisional applications to PCT applications, foreign office
actions, and actual filing costs. Travel costs have decreased in the nine months ended March 31, 2019 compared to the nine months
ended March 31, 2018 as we have focused on reducing all travel expenses.
General
and Administrative
General
and administrative expenses were $2,796,884 for the nine months ended March 31, 2019 compared to $2,911,538 for the nine months
ended March 31, 2018. The decrease was largely due to lower professional fees and travel partially offset by higher personnel
and non-cash, share-based compensation expense in the current period compared to the prior period. In relation to general and
administrative expenses during the nine months ended March 31, 2019, we incurred non-cash, share-based compensation expense of
$510,661 relating to performance share units, warrants issued for services, and stock option expense while during the nine months
ended March 31, 2018, we incurred non-cash, share-based compensation expense of $455,331 relating to warrants issued for services
and stock option expense. The performance stock units were issued in April 2018 so no expense for these equity instruments were
recognized during the nine months ended March 31, 2018.
Excluding
the impact of non-cash, share-based compensation expense, general and administrative expenses decreased in the nine months ended
March 31, 2019 to $2,286,223 from $2,456,207 for the nine months ended March 31, 2018. The decrease was primarily due to decreased
professional fees and travel costs partially offset by higher personnel costs. Professional fees decreased as a result of certain
costs incurred in the prior period that have not been incurred in the current period. Legal fees have decreased in the nine months
ended March 31, 2019 compared to nine months ended March 31, 2018 in part due to the timing of our annual meeting of stockholders.
In the current period, we have not yet incurred costs for this matter while a portion of these costs was incurred in the prior
period. Overall, costs for regulatory filings and corporate governance matters have been lower in the current nine months compared
to the prior nine months. Partially offsetting lower legal fees are increased public relations and business development costs
due to our efforts to expand our outreach to investors while accounting support has increased due to the complexity of the valuation,
and accounting for, our equity instruments. Travel costs have decreased in the nine months ended March 31, 2019 compared to the
nine months ended March 31, 2018 as we have focused on reducing all travel expenses. Personnel costs have increased during the
nine months ended March 31, 2019 compared to the nine months ended March 31, 2018 primarily due to the appointment of our President
and Chief Executive Officer in May 2018.
Change
in fair value of derivative liability
Based
on the terms of certain warrants issued by us, we have determined that the warrants were a derivative liability which is recognized
at fair value at the date of the transaction and re-measured at fair value every reporting period with gains or losses on the
changes in fair value recorded in the consolidated condensed statement of loss and comprehensive loss. The balances recognized
during the nine months ended March 31, 2019 and 2018 were primarily due to changes in our common stock price between the date
the warrants were last valued on June 30, 2018 and 2017 respectively. These are the previous valuation dates used for the nine
months ended March 31.
We
recognized gains of $852 and $57,839 from the change in fair value of the derivative liability for the nine months ended March
31, 2019 and 2018, respectively.
Foreign
Exchange
Our
functional currency at June 30, 2018 and March 31, 2019 is the US$ but we incur a portion of our expenses in CA$. The foreign
exchange gains and losses are reported in other loss (income) in the consolidated condensed interim statement of loss and comprehensive
loss. We have recognized foreign exchange losses of $16,754 and $57,406 for the nine-month periods ended March 31, 2019 and 2018,
respectively. The losses were due to changes in the exchange rate between the CA$ and the US$ and to varying levels of CA$ cash
and accounts payable.
27
Preferred
Share Dividends
For
each of the nine-month periods ended March 31, 2019 and 2018 we recorded $6,267 related to the dividend payable to Valent on the
Series A preferred stock. The dividend has been recorded as a direct increase in accumulated deficit for both periods.
During
the nine months ended March 31, 2019, we issued 14,430 (2018 — 14,881) shares of common stock as a dividend on the Series
B Preferred stock and recognized $75,477 (2018 — $142,358) as a direct increase in accumulated deficit.
Comparison
of the years ended June 30, 2018 and June 30, 2017
Years ended
June 30,
2018
$
June 30,
2017
$
Change
$
Change
%
Research and development
7,132,952
5,003,640
2,129,312
43
General and administrative
4,041,711
3,317,189
724,522
22
Change in fair value of stock option and derivative liabilities
(60,111
)
(245,963
)
185,852
(76
)
Foreign exchange loss
57,003
7,355
49,648
675
Interest income
(33,243
)
(457
)
(32,786
)
7,174
Net loss and comprehensive loss
11,138,312
8,081,764
3,056,548
Research
and Development
Research
and development expenses increased to $7,132,952 for the year ended June 30, 2018 from $5,003,640 for the year ended June 30,
2017. The increase was largely attributable to an increase in clinical development, personnel, and preclinical research partially
offset by lower travel costs. Non-cash, share-based compensation expense for the year ended June 30, 2018 was $149,452 related
to stock option expense and shares issued for services while non-cash, share-based compensation expense for the year ended June
30, 2017 was $102,828 for stock option expense and warrants issued for services.
Excluding
the impact of non-cash, share-based compensation expense, research and development expenses increased to $6,983,500 during the
current year from $4,900,812 for the prior year. The increase in clinical development costs for the year ended June 30, 2018 compared
to the year ended June 30, 2017 was partially due to manufacturing costs for GMP material as well as ongoing trial costs for our
two Phase 2, biomarker-driven, MGMT-unmethylated, GBM studies. At June 30, 2017, our Phase 2 study in Avastin-naïve unmethylated
GBM patients being conducted at the MD Anderson Cancer Center had commenced in February 2017 so patient enrollment had just begun.
Also, in the prior year, enrollment in our Phase 2 study in newly diagnosed unmethylated GBM patients in China had not yet started
enrollment.
During
the year ended June 30, 2018, we undertook site initiation and enrollment for its now-parked STAR-3, Phase 3 study in GBM. During
the year ended June 30, 2018, we recognized certain costs relating to the parking of the trial. As our two Phase 2, biomarker-driven
studies are partially supported through collaboration arrangements, the ongoing clinical costs for these two studies will be lower
than the overall clinical costs incurred by us for the year ended June 30, 2018.
Personnel
costs increased during the current year compared to the prior year primarily due to amounts recognized for payments made to our
former President and Chief Operating Officer pursuant to a settlement agreement between us and such individual. Preclinical research
increased in the year ended June 30, 2018 compared to the year ended June 30, 2017 largely due our research agreement with Duke
University which commenced in April 2017 as well as due to an increase in the ongoing mechanism of action research that we have
undertaken in the current year. Travel costs have decreased in the year ended June 30, 2018 compared to the year ended June 30,
2017 as we have focused on reducing all but essential travel.
General
and Administrative
General
and administrative expenses were $4,041,711 for the year ended June 30, 2018 compared to $3,317,189 for the year ended June 30,
2017. The increase was primarily due to an increase in professional fees and personnel costs. In relation to general and administrative
expenses during the year ended June 30, 2018, we incurred non-cash, share-based compensation expense of $596,079 relating to warrants
issued for services, stock option expense, and the PSUs while during the year ended June 30, 2017, we incurred non-cash, share-based
compensation expense of $667,521 relating to shares and warrants issued for services, and stock option expense.
Excluding
the impact of non-cash, share-based compensation expense, general and administrative expenses increased in the year ended June
30, 2018 to $3,445,632 from $2,649,668 for the year ended June 30, 2017. Professional fees incurred during the year ended June
30, 2018 relate to various matters including preparation for our first annual meeting of stockholders which was held April 11,
2018, completing our 2017 Omnibus Incentive Plan, regulatory filings, and corporate governance matters. In the year ended June
30, 2017, the costs were incurred related to preparing for our uplisting of its common stock on the Nasdaq Stock Market as well
as fees associated with one-time listing activities, and the filing of three registration statements with the SEC that were all
declared effective in September 2016. Personnel costs increased during the current year compared to the prior year primarily due
to amounts recognized for payments made to our former President and Chief Operating Officer pursuant to the settlement agreement.
28
Change
in fair value of stock option and derivative liabilities
Based
on the terms of certain warrants issued by us, we determined that such warrants were a derivative liability which is recognized
at fair value at the date of the transaction and re-measured at fair value every reporting period with gains or losses on the
changes in fair value recorded in the consolidated statement of operations and comprehensive loss. The gains recognized during
the years ended June 30, 2018 and 2017 were primarily due to changes in our common stock price between June 30, 2017 and 2016,
respectively, and June 30, 2018 and 2017, respectively.
We
recognized a gain of $60,111 from the change in fair value of the derivative liability for the year ended June 30, 2018 and a
gain of $331,057 for the year ended June 30, 2017.
Changes
in our common stock price can result in significant volatility in our reported net loss due to its impact on the fair value of
the derivative liability. As a result of revaluation gains and losses, we expect that our reported net income or loss will continue
to fluctuate significantly.
Certain
of our stock options have been issued in $CA. Of these, a portion were classified as a stock option liability which is revalued
at each reporting date. During the year ended June 30, 2017, we amended 4,375 of these stock options held by five optionees such
that the exercise price of the options was adjusted to be denominated in $USD. No other terms of the stock options were amended.
As a result of the amendment, we recognized $85,094 in stock option liability expense and $260,969 was reclassified to equity
during the year ended June 30, 2017.
Foreign
Exchange
Our
functional currency at June 30, 2018 was the US$, but we incur a portion of its expenses in CA$. The foreign exchange gains and
losses are reported in other loss (income) in the consolidated statement of operations and comprehensive loss.
We
recognized foreign exchange losses of $57,003 and $7,355 for the years ended June 30, 2018 and 2017, respectively. The losses
were due to changes in the exchange rate between the CA$ and the US$ and to varying levels of CA$ cash and accounts payable.
Preferred
Share Dividends
For
each of the years ended June 30, 2018 and 2017, we recognized $8,356 related to the dividend payable to Valent on the Series A
preferred stock. The dividend has been recorded as a direct increase in accumulated deficit for both periods.
We
issued 19,841 (2017 — 20,045) shares of common stock on June 30, 2018 as a dividend on the Series B Preferred stock and
recognized $176,236 (2017 — $790,454) as a direct increase in accumulated deficit.
Liquidity
and Capital Resources
Nine
months ended March 31, 2019 compared to the nine months ended March 31, 2018
March 31,
2019
$
March 31,
2018
$
Change
$
Change
%
Cash flows from operating activities
(4,514,674
)
(7,318,012
)
2,803,338
(38
)
Cash flows from investing activities
—
(12,649
)
12,649
(100
)
Cash flows from financing activities
694,912
9,251,569
(8,556,657
)
(92
)
Operating
Activities
Net
cash used in operating activities decreased to $4,514,674 for the nine months ended March 31, 2019 from $7,318,012 for the nine
months ended March 31, 2018. During the nine months ended March 31, 2019 and 2018, we reported net losses of $5,465,486 and $8,761,061,
respectively. During the nine months ended March 31, 2019, we recorded a gain from the revaluation of the derivative liability
of $852 compared to a gain of $57,839 for the nine months ended March 31, 2018. Excluding the impact of changes in the fair value
of the derivative liability, non-cash items relating to amortization of intangible assets, shares and warrants issued for services,
stock option expense, and performance share unit expense totaled $598,944 for the nine months ended March 31, 2019. Non-cash items
relating to amortization of intangible assets, warrants issued for services, and stock option expense totaled $608,567 for the
nine months ended March 31, 2018.
The
most significant changes in non-cash working capital for the nine months ended March 31, 2019 was an increase in cash from a decrease
in prepaid expenses and deposits of $794,859 due to a partial refund of our clinical trial deposit related to our now-parked STAR-3
Phase 3 study. The other significant change in on-cash working capital in the current period was a decrease in cash from a reduction
in accounts payable and accrued liabilities of $425,383. The most significant changes in non-cash working capital for the nine
months ended March 31, 2018 was cash from an increase of accounts payable and accrued liabilities of $708,634 and cash from a
decrease in prepaid expense and deposits of $135,293.
29
Investing
activities
During
the nine months ended March 31, 2018, we incurred $12,649 in relation to the development of our website. There were no cash flows
from investing activities during the nine months ended March 31, 2019.
Financing
Activities
During
the nine months ended March 31, 2019, we received $726,179 in net proceeds from the exercise of warrants pursuant to the Warrant
Exercise Agreements. During the nine months ended March 31, 2018, we received $8,945,336 in net proceeds from the completion of
a registered direct offering by us of common stock and common stock purchase warrants. In addition, we recorded $6,267 related
to the dividend payable to Valent during each of the nine months ended March 31, 2019 and 2018 respectively. During the nine months
ended March 31, 2019, we also recognized $25,000 in deferred costs related to our pending financing.
Comparison
of the years ended June 30, 2018 and June 30, 2017
June 30,
2018
$
June 30,
2017
$
Change
$
Change
%
Cash flows from operating activities
(9,850,850
)
(8,019,071
)
(1,831,779
)
23
Cash flows from investing activities
(12,649
)
(20,956
)
8,307
(40
)
Cash flows from financing activities
9,249,480
8,468,777
780,703
9
Operating
activities
Net
cash used in operating activities increased to $9,850,850 for the year ended June 30, 2018 from $8,019,071 for the year
ended June 30, 2017. During the year ended June 30, 2018 and 2017, we reported net losses of $11,138,312 and $8,081,764,
respectively. During the year ended June 30, 2018, we recorded a gain from the revaluation of the derivative and stock option
liabilities of $60,111 compared to a gain of $245,963 for the year ended June 30, 2017. Excluding the impact of changes in
the fair value of the derivative and stock option liabilities, non-cash items relating to amortization of intangible assets,
shares and warrants issued for services, and PSU and stock option expense totaled $770,059 for the year ended June 30, 2018.
Non-cash items relating to amortization of intangible assets, shares and warrants issued for services, and stock option
expense totaled $787,032 for the year ended June 30, 2017. The most significant changes in non-cash working capital for the
year ended June 30, 2018 was from an inflow due to increase in accounts payable and accrued liabilities of $295,774 and from
an inflow due to a decrease in prepaid expenses and deposits of $173,192. The most significant changes in non-cash working
capital for the year ended June 30, 2017 was from an outflow from an increase in prepaid expenses and deposits of $1,063,991
and from an inflow due to an increase in accounts payable and accrued liabilities of $598,310.
30
As
of June 30, 2018, we had cash and cash equivalents to fund operations into the middle of calendar 2019. We will need to raise
additional capital in the near future.
Investing
activities
During
the years ended June 30, 2018 and 2017, we incurred $12,649 and $20,956, respectively, in relation to the development of our website.
Financing
activities
During
the year ended June 30, 2018, we received $8,945,336 in net proceeds from the completion of a registered direct offering by us
of common stock and common stock purchase warrants. During the year ended June 30, 2017, we received $7,932,107 in net proceeds
from a public offering of its common stock and common stock purchase warrants.
During
the years ended June 30, 2018 and 2017, we received $312,500 and $545,026, respectively, from the exercise of warrants. In addition,
we recognized $8,356 related to the dividend payable to Valent during each of the years ended June 30, 2018 and 2017, respectively.
Going
Concern and Capital Expenditure Requirements
Registered
Direct Offering and Private Placement
On
June 5, 2019, we completed a registered direct offering (the "RD Offering") of an aggregate of 1,170,000 shares of
common stock and warrants to purchase 760,500 shares of common stock in a concurrent private placement, at a combined purchase
price of $3.10 per share and related warrant. The warrants have an exercise price of $3.10 per share, are immediately exercisable
and have a term of exercise of five years. The gross proceeds from the offering, prior to deducting offering expenses and placement
agent fees and expenses payable by us, were $3.6 million.
Going
Concern
(See
note 1 to the consolidated condensed interim financial statements)
The
consolidated condensed interim financial statements have been prepared on a going concern basis which assumes that we will continue
our operations for the foreseeable future and contemplates the realization of assets and the settlement of liabilities in the
normal course of business.
For
the nine months ended March 31, 2019, we reported a loss of $5,465,486 and negative cash flow from operations of $4,514,674. As
of March 31, 2019, we had an accumulated deficit of $57,988,567 and cash and cash equivalents on hand of $2,152,233. We are in
the development stage and have not generated any revenues to date. We do not have the prospect of achieving revenues until such
time that our product candidate is commercialized, or partnered, which may not ever occur. In the near future, we will require
additional funding to maintain our clinical trials, research and development projects, and for general operations. These circumstances
indicate substantial doubt exists about our ability to continue as a going concern.
Consequently,
management is pursuing various financing alternatives to fund our operations so we can continue as a going concern. Management
plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership arrangements.
We may tailor our drug candidate development program based on the amount of funding we are able to raise in the future. Nevertheless,
there is no assurance that these initiatives will be successful.
The
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should we be unable to continue as a going concern. Such adjustments could be material.
31
Our
future funding requirements will depend on many factors, including but not limited to:
●
the rate of progress and cost of our
                             clinical trials, preclinical studies and other discovery and research and development activities;
●
the costs associated with establishing
                                    manufacturing and commercialization capabilities;
●
the costs of acquiring or investing
                             in businesses, product candidates and technologies;
●
the costs of filing, prosecuting, defending
                             and enforcing any patent claims and other intellectual property rights;
●
the costs and timing of seeking
                                    and obtaining FDA and other regulatory approvals;
●
the effect of competing technological
                             and market developments;
●
the economic and other terms and timing
                             of any collaboration, licensing or other arrangements into which we may enter; and.
●
the impact of us being a public
                                    entity.
In
September 2018, we announced that we had engaged Oppenheimer & Co. Inc. as our strategic advisor to help manage the exploration
and evaluation of a wide range of strategic opportunities. Until we can generate a sufficient amount of product revenue to finance
our cash requirements, which we may never do, we expect to finance future cash needs primarily through public or private equity
offerings or strategic collaborations. The sale of equity and convertible debt securities may result in dilution to our stockholders
and certain of those securities may have rights senior to those of our shares of capital stock. If we raise additional funds through
the issuance of preferred stock, convertible debt securities or other debt financing, these securities or other debt could contain
covenants that would restrict our operations. Any other third-party funding arrangement could require us to relinquish valuable
rights. Economic conditions may affect the availability of funds and activity in equity markets. We do not know whether additional
funding will be available on acceptable terms, or at all. If we are not able to secure additional funding when needed, we may
have to delay, reduce the scope of or eliminate one or more of our clinical trials or research and development programs or make
changes to our operating plan. In addition, we may have to seek a partner for one or more of our product candidate programs at
an earlier stage of development, which would lower the economic value of those programs to us.
Critical
Accounting Policies
The
preparation of financial statements, in conformity with generally accepted accounting principles in the United States, requires
companies to establish accounting policies and to make estimates that affect both the amount and timing of the recording of assets,
liabilities, revenues and expenses. Some of these estimates require judgments about matters that are inherently uncertain and
therefore actual results may differ from those estimates.
A
detailed presentation of all of our significant accounting policies and the estimates derived therefrom is included in Note 2
to our consolidated financial statements for the year ended June 30, 2018 contained elsewhere in this prospectus. While all of
the significant accounting policies are important to our consolidated condensed financial statements, the following accounting
policies and the estimates derived therefrom are critical:
●
Warrants
                                         and shares issued for services
●
Stock
                                         options
32
●
Performance stock units
●
Derivative liability
●
Clinical trial accruals
Warrants
and shares issued for services
We
have issued equity instruments for services provided by employees and nonemployees. The equity instruments are valued at the fair
value of the instrument granted.
Stock
options
We
account for these awards under Accounting Standards Codification ("ASC") 718, "Compensation — Stock Compensation"
("ASC 718"). ASC 718 requires measurement of compensation cost for all stock-based awards at fair value on the date
of grant and recognition of compensation over the requisite service period for awards expected to vest. Compensation expense for
unvested options to non-employees is revalued at each period end and is being amortized over the vesting period of the options.
The determination of grant-date fair value for stock option awards is estimated using the Black-Scholes model, which includes
variables such as the expected volatility of our share price, the anticipated exercise behavior of its grantee, interest rates,
and dividend yields. These variables are projected based on our historical data, experience, and other factors. Changes in any
of these variables could result in material adjustments to the expense recognized for share-based payments. Such value is recognized
as expense over the requisite service period, net of actual forfeitures, using the accelerated attribution method. We recognize
forfeitures as they occur. The estimation of stock awards that will ultimately vest requires judgment, and to the extent actual
results, or updated estimates, differ from current estimates, such amounts are recorded as a cumulative adjustment in the period
estimates are revised.
Performance
stock units
We
also account for performance stock units (PSU's) under ASC 718. ASC 718 requires measurement of compensation cost for all
stock-based awards at fair value on the date of grant and recognition of compensation over the requisite service period for awards
expected to vest. As vesting of the PSU's is based on a number of factors, the determination of the grant-date fair value
for PSU's has been estimated using a Monte Carlo simulation approach which includes variables such as the expected volatility
of our share price and interest rates to generate potential future outcomes. These variables are projected based on our historical
data, experience, and other factors. Changes in any of these variables could result in material adjustments to the expense recognized
for the PSUs. Such value is recognized as expense over the derived service period using the accelerated attribution method. The
estimation of PSUs that will ultimately vest requires judgment, and to the extent actual results, or updated estimates, differ
from current estimates, such amounts are recorded as a cumulative adjustment in the period estimates are revised.
Derivative
liability
We
account for certain warrants under the authoritative guidance on accounting for derivative financial instruments indexed to, and
potentially settled in, a company's own stock, on the understanding that in compliance with applicable securities laws,
the warrants require the issuance of securities upon exercise and do not sufficiently preclude an implied right to net cash settlement.
We classify these warrants on our balance sheet as a derivative liability which is fair valued at each reporting period subsequent
to the initial issuance. We have used a binomial model as well as a Black-Scholes Option Pricing Model (based on a closed-form
model that uses a fixed equation) to estimate the fair value of the share warrants. Determining the appropriate fair-value model
and calculating the fair value of warrants requires considerable judgment. Any change in the estimates (specifically probabilities
and volatility) used may cause the value to be higher or lower than that reported. The estimated volatility of our common stock
at the date of issuance, and at each subsequent reporting period, is based on our historical volatility. The risk-free interest
rate is based on rates published by the government for bonds with a maturity similar to the expected remaining life of the warrants
at the valuation date. The expected life of the warrants is assumed to be equivalent to their remaining contractual term.
Clinical
trial accruals
Clinical
trial expenses are a component of research and development costs and include fees paid to contract research organizations, investigators
and other service providers who conduct specific research for development activities on our behalf. The amount of clinical trial
expenses recognized in a period related to service agreements is based on estimates of the work performed on an accrual basis.
These estimates are based on patient enrollment, services provided and goods delivered, contractual terms and experience with
similar contracts. We monitor these factors by maintaining regular communication with the service providers. Differences between
actual expenses and estimated expenses recorded are adjusted for in the period in which they become known. Prepaid expenses or
accrued liabilities are adjusted if payments to service providers differ from estimates of the amount of service completed in
a given period.
Off-Balance
                                         Sheet Arrangements
We
do not have any off-balance sheet arrangements.
33
BUSINESS
Background
We
are a clinical stage, biopharmaceutical company focused on the development and commercialization of new cancer therapies. Our
mission is to benefit patients by developing and commercializing anti-cancer therapies for patients whose tumors exhibit features
that make them resistant to, or unlikely to respond to, currently available therapies, particularly for orphan cancer indications
where patients have failed, or are unlikely to respond to, currently available therapy.
As
of December 31, 2018, we have spent approximately $37.3 million of shareholder capital in developing VAL-083, a novel, validated,
DNA-targeting agent, for the treatment of drug-resistant solid tumors such as glioblastoma multiforme ("GBM") and
potentially other solid tumors, including ovarian cancer, non-small cell lung cancer ("NSCLC"), and diffuse intrinsic
pontine glioma ("DIPG"). VAL-083 is a first-in-class, small-molecule, DNA-targeting chemotherapeutic that demonstrated
activity against a range of tumor types in prior Phase 1 and Phase 2 clinical studies sponsored by the US National Cancer Institute
("NCI"). As part of our business strategy, we leverage and build upon these prior NCI investments and data from more
than 40 NCI- Phase 1 and Phase 2 clinical studies, which includes an estimated 1,000 patient safety database, with our own research
to identify and target unmet medical needs in modern cancer care. DNA-targeting agents are among the most successful and widely
used treatments for cancer. Their efficacy is based on the ability to bind with a cancer cell's DNA and interfere with the
process of protein production required for growth and survival of cancer cells. "First-in-class" means that VAL-083
embodies a unique molecular structure which is not an analogue or derivative of any approved product, or product under development,
for the treatment of cancer.
Our
recent research has highlighted the opportunities afforded by VAL-083's unique mechanism of action and its potential to
address unmet medical needs by focusing our development efforts on patients whose tumors exhibit biological features that make
them resistant to, or unlikely to respond to, currently available therapies. For example, our research demonstrating VAL-083's
activity in GBM independent of the O6-methyl guanine methyltransferase ("MGMT") methylation status allows us to focus
patient selection based on this important biomarker.
We
are conducting two open-label, biomarker driven Phase 2 studies in MGMT-unmethylated GBM. MGMT is a DNA-repair enzyme that is
associated with resistance to temozolomide, the current standard-of-care chemotherapy used in the treatment of GBM. Greater than
60% of GBM patients have MGMT-unmethylated tumors and exhibit a high expression of MGMT, which is correlated with temozolomide
treatment failure and poor patient outcomes. Our research demonstrates that VAL-083's anti-tumor activity is independent
of MGMT expression. In our Phase 2 studies we are using MGMT as a biomarker to identify patients for treatment with VAL-083 in
the newly-diagnosed, maintenance-stage (adjuvant) and recurrent treatment settings. If successful, the result of these studies
could position VAL-083 for advancement to pivotal clinical studies as a potential replacement for temozolomide in MGMT-unmethylated
GBM. We anticipate presenting data from these studies at peer reviewed scientific meetings during calendar 2019.
With
respect to our STAR-3, Phase 3 study, we have finalized the decision to discontinue this clinical study due to competitive landscape,
patient enrollment rates, and potential risk of success assessment, and to allow us to focus on enrolling GBM patients in our
two biomarker-driven Phase 2 studies.
We
have received notice to proceed from the US Food and Drug Administration ("FDA") for a phase 1/2, open-label, multicenter
study of VAL-083 in patients with
Re
current
P
latinum
R
esistant
Ov
arian
Cancer ("REPROVe"). Platinum-based chemotherapy is the standard-of-care in the treatment of ovarian cancer. Nearly
all ovarian cancer patients eventually become resistant to platinum ("Pt") based chemotherapy leading to treatment
failure and poor patient outcomes. We have demonstrated that VAL-083 is active against Pt-resistant ovarian cancer
in vitro.
However, based on ongoing evaluation and input from our ovarian cancer advisory board, we are reassessing the development
of VAL-083 for the treatment of ovarian cancer. We are in the process of evaluating the best path forward in ovarian cancer and
are evaluating strategic options, including the potential combination of VAL-083 with PARP inhibitors. At the American Association
for Cancer Research ("AACR") Annual Meeting in 2018 we presented preclinical data showing that VAL-083 can synergize
PARP inhibitors in both a BRACA-proficient and -deficient setting.
In
addition to our clinical development activities in the United States, pursuant to our collaboration with Guangxi Wuzhou Pharmaceutical
(Group) Co. Ltd. ("Guangxi Wuzhou Pharmaceutical Company"), we have provided Guangxi Wuzhou Pharmaceutical Company
certain commercial rights to VAL-083 in China where it is approved as a chemotherapy for the treatment of chronic myelogenous
leukemia ("CML") and lung cancer. Guangxi Wuzhou Pharmaceutical Company is the only manufacturer presently licensed
by the China Food and Drug Administration ("CFDA") to produce the product for the China market.
We
have a broad patent portfolio to protect our intellectual property. Our patent applications claim composition of matter and methods
of use of VAL-083 and related compounds, synthetic methods, and quality controls for the manufacturing process of VAL-083. We
believe that our portfolio of intellectual property rights provides a defensible market position for the commercialization of
VAL-083. In addition, VAL-083 has been granted protection under the Orphan Drug Act by the FDA and the European Medicines Agency
("EMA") for the treatment of gliomas, including GBM. The FDA has also granted Orphan Drug protection to VAL-083 for
the treatment of medulloblastoma and ovarian cancer.
Our
corporate development strategy is to advance our drug candidate into multiple clinical studies and then to consider licensing,
or acquiring additional product candidates, in order to establish a product pipeline and to position us for long-term sustainability
and growth of shareholder value. We believe the experience of our clinical development team will position us to efficiently develop
drug candidates that we may acquire, or license, in the future.
We
intend to continue to evaluate options for our strategic direction. These options may include raising additional capital, the
acquisition of another company and/or complementary assets, our sale, or another type of strategic partnership.
34
Registered
Direct Offering and Private Placement
On
June 3, 2019, we entered into a securities purchase agreement with the selling stockholders for the issuance and sale of an aggregate
of 1,170,000 shares of common stock in a registered direct offering (the "RD Offering") and, in a concurrent private
placement, warrants to purchase 760,500 shares of common stock at a combined purchase price of $3.10 per share and related warrant.
The warrants have an exercise price of $3.10 per share, are immediately exercisable and have a term of exercise of five years.
The closing of the issuance and sale of these securities was consummated on June 5, 2019. The gross proceeds from the offering,
prior to deducting offering expenses and placement agent fees and expenses payable by us, were $3.6 million.
Subject
to certain ownership limitations, the warrants are exercisable commencing on the issuance date at an exercise price equal to $3.10
per share of common stock, subject to adjustments as provided under the terms of the warrants. Subject to certain exceptions set
forth in the warrants, if, on or prior to June 28, 2019, we sell or grant any option to purchase or sell or grant any right to
reprice, or otherwise dispose of or issue, any common stock or securities convertible into or exercisable for common stock at
an effective price per share that is lower than the exercise price of the warrants then in effect, then the exercise price of
the Warrants will be reduced to equal the higher of  (A) such lower price or (B) $2.25.
Clinical
Updates Presented at 2019 American Society of Clinical Oncology
On
May 31, 2019, the Company presented clinical trial updates from the Company's ongoing first- and second-line trials in patients
with MGMT-unmethylated glioblastoma multiforme (GBM) at a key opinion leader (KOL) presentation during the 2019 American Society
of Clinical Oncology (ASCO) annual meeting in Chicago, IL.
At
the KOL presentation, the Company provided an update on the ongoing Phase 2 clinical study investigating the front-line treatment
of VAL-083 with radiation therapy in newly diagnosed MGMT-unmethylated GBM. This trial is being conducted at the Sun Yat-sen University
Cancer Center (SYSUCC) in Guangzhou, China in collaboration with Guangxi Wuzhou Pharmaceutical Company. The trial is designed
to enroll up to 30 patients to determine if first-line therapy with VAL-083 treatment, in lieu of first-line temozolomide, improves
progression free survival (PFS).
As
of May 17, 2019, eighteen patients have been enrolled in the trial. Of these patients, fifteen have received their post-cycle
3 MRI and investigator assessment, and ten have received their post-cycle 7 MRI and investigator assessment. Two patients have
not been on the study long enough to reach their first assessment, and one patient died before their first assessment. Assessments
are based on the trial investigator's clinical and radiologic assessment, according to the Response Assessment in NeuroOncology
(RANO) criteria. For the fifteen patients who have received at least one assessment, eight patients were assessed with a best
response of "Complete Response" (8/15, 53.3% CR) and seven patients were assessed with a best response of "Stable
Disease" (7/15, 46.7% SD). Fourteen of the eighteen patients were still alive at the data cut-off date.
The
Company also provided an update on the ongoing second-line Phase 2 clinical study of VAL-083 in patients with MGMT-unmethylated,
Bevacizumab-naïve recurrent GBM. This study is being conducted in collaboration with The University of Texas MD Anderson
Cancer Center (MDACC). This biomarker-driven trial (testing for MGMT methylation status) has been amended to enroll up to 83 patients
(35 with a starting dose of 40 mg/m2; 48 with a starting dose of 30 mg/m
2
) to determine the potential of VAL-083 treatment
to improve overall survival compared to historical reference control of 7.2 months with lomustine.
●
As of May 5, 2019, 51 patients have
                             been enrolled, 35 patients at a starting dose of 40 mg/m2, and 16 patients at a starting dose of
                             30 mg/m
2
.
●
For the 47 patients who have been on
                             study long enough to be assessed at the post-cycle 2 MRI:
●
9/35 (25.7%) patients initially
                                    receiving 40 mg/m
2
exhibited "Stable Disease" per investigator assessment
                                    at the end of cycle 2
●
4/12 (33.3%) patients initially receiving
                             30 mg/m
2
exhibited "Stable Disease" per investigator assessment at the end
                             of cycle 2
Additionally,
the study protocol has been amended to include enrollment of up to 24 newly-diagnosed GBM patients who have completed chemoradiation
treatment with TMZ and received no subsequent TMZ maintenance therapy but will receive VAL-083 instead (Group 2). This Group has
been included to explore whether earlier intervention with VAL-083 instead of TMZ maintenance therapy offers clinical benefit
and extends the time to recurrence as compared to TMZ maintenance therapy.
Consistent
with prior studies, myelosuppression (primarily thrombocytopenia and neutropenia) is the most common adverse event in both ongoing
clinical trials.
VAL-083
Clinical Studies
We
are currently developing VAL-083, a novel DNA-targeting agent for the treatment of GBM and potentially other solid tumors, including
ovarian cancer. Our recent research has highlighted the opportunities afforded by VAL-083's unique mechanism of action and
its potential to address unmet medical needs by focusing our development efforts on patients whose tumors exhibit biological features
that make them resistant to, or unlikely to respond to, currently available therapies. For example, our research demonstrating
VAL-083's activity in GBM is independent of the MGMT methylation status allows us to focus patient selection based on this
important biomarker.
35
The
evaluation of MGMT promotor methylation status has increasingly become common practice in the diagnostic assessment of GBM. In
September 2017, the National Comprehensive Cancer Network ("NCCN") updated guidelines for the standard treatment of
GBM based on MGMT methylation status. We believe these recently published guidelines provide for enhanced opportunities for us
to capitalize on VAL-083's unique mechanism of action by utilizing MGMT methylation as a biomarker to optimize patient selection
for our novel DNA-targeting agent to target the majority of GBM patients who are diagnosed with MGMT-unmethylated tumors.
Our
current priority is to leverage this research and VAL-083's unique mechanism of action to efficiently advance our drug candidate
for the most promising indications, including:
●
MGMT-unmethylated GBM, currently
                                    comprising two ongoing separate Phase 2 clinical studies for:
●
rGBM patients (ongoing study at MDACC);
                             and
●
Newly diagnosed GBM patients
                                    (ongoing study at Sun Yat-sen University); and
●
Based on published data from
                                    our Phase 2 studies being conducted at MDACC and in China, we have identified an additional
                                    opportunity in pre-temozolomide maintenance GBM patients, and
●
Potential future indications
                                    include ovarian cancer, non-small cell lung cancer ("NSCLC"), and other solid
                                    tumor indications.
MGMT-unmethylated
GBM
GBM
is the most common and the most lethal form of glioma. According to the Central Brain Tumor Registry of the United States, GBM
occurs with an incidence of 3.20 per 100,000 person-years. Approximately 13,000 new cases of GBM were diagnosed in the United
States and 16,000 in Europe during 2017. Within the GBM patient population, approximately two-thirds of patients are unmethylated
with respect to their MGMT status.
Measurement
of MGMT (O6-methyl guanine methyltransferase) methylation status has become routine in clinical practice as a biomarker that correlates
with resistance to the standard-of-care chemotherapy with temozolomide (Temodar
®
"TMZ"), and patient
outcomes in GBM. Greater than 60% of GBM patients' tumors are characterized as "MGMT-unmethylated" and exhibit
a high expression of MGMT, a naturally occurring DNA-repair enzyme, the activity of which nullifies the chemotherapeutic activity
of TMZ. The development of new therapies for MGMT-unmethylated GBM is a significant unmet medical need. Importantly, the most
recent update to NCCN guidelines states that the treatment benefit of TMZ is likely to be lower in GBM patients with an unmethylated
MGMT promoter, and therefore, allows for withholding of TMZ in the treatment of newly diagnosed GBM patients with MGMT-unmethylated
tumors due to lack of efficacy.
We
have demonstrated that VAL-083's anti-tumor mechanism is active independent from the MGMT status
in vitro
. We believe
this suggests the potential of VAL-083 as a replacement for the current standard-of-care chemotherapy, temozolomide, in MGMT-unmethylated
GBM. We are therefore utilizing MGMT-methylation status to identify GBM patients who are unlikely to respond to temozolomide and
instead treat them with VAL-083.
We
believe that our research, in the context of the recent amendment to NCCN guidelines, highlights this unmet need and the opportunity
for VAL-083 as a potential new standard-of-care in the treatment of MGMT-unmethylated GBM.
Phase
2 Study in MGMT-unmethylated rGBM in Collaboration with University of Texas MD Anderson Cancer Center
In
February 2017, we initiated a biomarker driven, open-label, single-arm Phase 2 study in collaboration with MDACC. This study will
enroll up to 48 MGMT-unmethylated GBM patients whose tumors have recurred following treatment with temozolomide. These patients
will not have been treated previously with Avastin
®
. The primary endpoint of the study is overall survival. The
historical comparison survival data for this study is lomustine based on a median overall survival of 7.2 months in unmethylated
patients. Safety data from this study will become part of the overall safety dossier to support future filings with the FDA and
other regulatory agencies.
As
of March 13, 2019, 47 patients had been enrolled in this Phase 2 study. The original starting dose of 40 mg/m
2
of VAL-083
on days 1, 2 and 3, of a 21-day cycle, which was based on the results from our previous Phase 1/2 safety study of VAL-083 in patients
with recurrent glioma (clinicaltrials.gov identifier: NCT01478178), has continued to demonstrate myelosuppression as the principal
side effect of VAL-083, as per prior clinical experience. The safety profile has been well within the existing safety monitoring
guidelines described in the present study protocol. However, in consultation with the principal investigator at MDACC, we have
amended the protocol for this clinical study to modify the starting dose of VAL-083 to 30 mg/m
2
on days 1, 2 and 3,
of a 21-day cycle for this specific population previously treated with temozolomide. This modification may improve tolerance in
this patient population and maximize overall exposure to VAL-083 thereby increasing the number of cycles of drug patients are
able to receive. We have modified the patient screening platelet count, from 100,000/µL to 125,000/µL, for the same
reasons.
At
the AACR's annual meeting in April 2019, we reported that per investigator assessment at the end of cycle 2:
●
9/35
                                         (25.7%) patients initially receiving 40 mg/m
2
exhibited Stable Disease
●
4/10
                                         (40.0%) patients initially receiving 30 mg/m
2
exhibited Stable Disease
●
Two patients have not yet reached the
                             end of cycle 2
36
On
April 3, 2019, we announced that MDACC approved the adding of up to 35 patients to the recurrent GBM study at a dose of 30 mg/m
2
.
We had previously lowered the dose in this study from 40 mg/m
2
to 30 mg/m
2
to improve tolerance in this
patient population and maximize overall exposure to VAL-083 thereby increasing the number of cycles of drug patients are able
to receive. Upon completion of original 48 patients in this study, 13 will have had the 30 mg/m
2
dose and 35 will have
had the 40 mg/m
2
. Therefore, potentially adding an additional 35 patients at 30 mg/m
2
would result in a
total of 48 patients receiving the 30 mg/m
2
dose. We are still determining how many, if any, additional patients will
be added at the 30 mg/m
2
dose.
It
is important for this GBM patient population, which has been heavily pre-treated with temozolomide, to be able to be treated with
multiple cycles of VAL-083 without significant hematological toxicities. We believe the modified dose of VAL-083, in addition
to the change in patient eligibility platelet counts, should help provide for enhanced patient safety. We believe a positive outcome
from this study can establish a position for VAL-083 in the treatment of MGMT-unmethylated rGBM.
Based
on current enrollment rates, we are forecasting full enrollment in the second calendar quarter of 2019. Data from this study will
be used to help develop potential future clinical study designs with VAL-083 in MGMT-unmethylated rGBM. A detailed description
of this study can be found at clinicatrials.gov, Identifier Number: NCT02717962.
As
noted above, patients in our current MDACC clinical study have been heavily pre-treated with temozolomide. Based on published
data from our MDACC and SYSUCC clinical studies, we believe there is a significant opportunity to treat GBM patients in the pre-temozolomide
maintenance stage. At the AACR's annual meeting in April 2019, we reported that myelosuppression (thrombocytopenia and neutropenia)
is the most common adverse event associated with VAL-083. The higher potential for myelosuppression with the 40 mg/m
2
/day
of VAL-083 in this study appears to be correlated with the number of cycles of prior TMZ maintenance therapy (> 5 cycles).
These patients will have had an initial cycle of temozolomide following radiation but will not have yet started subsequent cycles
of temozolomide (i.e. maintenance stage TMZ patients). The MDACC IRB has approved the addition of up to 24 patients to the pre-TMZ
maintenance setting. These patients will have had an initial cycle of temozolomide following radiation but will not have yet started
subsequent cycles of temozolomide (i.e. maintenance stage TMZ patients). Subject to obtaining financing and all regulatory approvals,
we are planning a new Phase 2 study that would potentially enroll up to 24 pre-TMZ maintenance stage, MGMT-unmethylated GBM patients.
The comparison survival data for this study is survival data from Tanguturi et al (2017 Nero-Oncology) for MGMT-unmethylated patients
of 6.9 months.
Phase
2 Study in Newly Diagnosed MGMT-unmethylated GBM
In
September 2017, we initiated a single arm, biomarker driven, open-label Phase 2 study in newly diagnosed MGMT-unmethylated GBM
patients at Sun Yat-sen University Cancer Center (SYSUCC) in Guangzhou, China. The study is being conducted under our collaboration
agreement with Guangxi Wuzhou Pharmaceutical Company.
In
this Phase 2 study, VAL-083 is being combined with radiotherapy as a potential replacement for standard-of-care chemoradiation
with temozolomide in patients with MGMT-unmethylated GBM. One goal of the study will be to confirm the safety of the three-day
VAL-083 dosing regimen in combination with radiotherapy and to investigate outcomes of the combination of VAL-083 and radiotherapy
in MGMT-unmethylated GBM patients.
We
plan to enroll up to 30 newly-diagnosed, MGMT-unmethylated GBM patients in this study. The efficacy endpoints of the study include
tumor response, as assessed by the Response Assessment in NeuroOncology ("RANO"), and progression-free survival ("PFS"),
progression-free survival at six months ("PFS6"), and overall survival ("OS"), compared to historical
results in the target population. The study is being conducted in two parts: (1) Dose-confirmation: VAL-083 in cohorts (20, 30
and 40 mg/m2/day IV daily x 3 every 21 days) to assess safety and activity when administered concurrently with x-ray therapy ("XRT")
to confirm the maximum tolerated dose ("MTD"), and (2) Expansion: VAL-083 will be studied in up to 20 additional patients
at the target dose, as determined by the dose-confirmation part of the study, administered concurrently with XRT. Assessments
of safety and tolerability will be used to support further clinical development of VAL-083 in combination with radiotherapy. Pharmacokinetic
assessments of VAL-083 in plasma and cerebral spinal fluid ("CSF") will be used to correlate drug exposure in the
central nervous system with patient outcomes.
Dose
confirming cohorts studying 20, 30, and 40 mg/m
2
/day x three every 21 days have been completed. Based on the dose confirmation
phase of the study, we have selected 30 mg/m
2
for combination with irradiation for the treatment of newly-diagnosed
MGMT-unmethylated GBM patients.
As
of February 15, 2019, 15 patients have been enrolled in this study. The Company is pleased to report that for the 15 patients
enrolled to February 15, 2019, 11 have completed their prospectively planned Magnetic Resonance Imaging (MRI) scans and have had
their initial assessment for tumor progression. Tumor progression is based on the study investigator's clinical and radiologic
assessment, according to the RANO criteria. Of these 11 patients, five were assessed by the Principal Investigator as having a
"Complete Response", three of whom were based on significant tumor shrinkage, and two of whom were based on their
tumors continuing to remain "below measurable level" from post-surgery baseline MRI to post-cycle 3 MRI. Additionally,
six patients were assessed as having "Stable Disease." Of the remaining four patients, one died prior to their post-cycle
3 MRI and three have not been on study long enough to reach their planned post-cycle 3 MRI. As of the February 15, 2019 data cutoff,
12 of the 15 enrolled patients are still alive. Similar to prior experience, myelosuppression has been the most common adverse
event observed. Two dose-limiting toxicities have been reported (thrombocytopenia) — one at the 40 mg/m
2
/day
dose and one at the 30 mg/m
2
/day dose.
37
Through
our research, and that of the NCI, we have previously demonstrated that VAL-083 crosses the blood brain barrier. New preliminary
data from the SYSUCC study indicate that the concentration of VAL-083 is generally higher in CSF than in plasma at two hours post-infusion.
Concentration
of VAL-083 — Two Hours Post Dose
By
comparison, temozolomide is typically 80% lower in the CSF than the plasma (Schreck et al. 2018, Oncology (Williston Park)). The
reason this is important is that accumulation of VAL-083 in the CSF further validates that VAL-083 crosses the blood-brain-barrier
and demonstrates that therapeutic drug concentrations in the CSF are achievable for extended periods of time.
Ovarian
Cancer
In
April 2016, the FDA granted orphan drug designation for the use of VAL-083 in the treatment of ovarian cancer.
In
September 2017, we filed an IND for the use of VAL-083 in ovarian cancer, along with a protocol for a Phase 1/2, open-label,
multicenter, study of VAL-083 in patients with
Re
current
P
latinum
R
esistant
Ov
arian
Cancer (the REPROVe study).
The
FDA has allowed this study to begin enrolling patients, but based on ongoing evaluation and input from our ovarian advisory board,
we are reassessing the ovarian cancer program. We are in the process of evaluating the best path forward in ovarian cancer and
are looking at various strategic options including combination with PARP inhibitors.
Fast
Track Designation
In
December 2017, the FDA granted Fast Track designation for VAL-083 in rGBM.
Fast
Track designation is designed to expedite the review of drugs that show promise in treating life-threatening diseases and address
unmet medical needs, with the goal of getting new treatments to patients earlier. Fast Track designation provides sponsors with
an opportunity for increased frequency for communication with the FDA to ensure an optimal development plan and to collect appropriate
data needed to support drug approval. Additional benefits of the Fast Track designation may include an Accelerated Approval, a
Priority Review, and a Rolling Review. Accelerated Approval is granted to drugs that demonstrate an effect on a surrogate, or
intermediate endpoints, reasonably likely to predict clinical benefit. Priority Review shortens the FDA review process for a new
drug from ten months to six months and is appropriate for drugs that demonstrate significant improvements in both safety and efficacy
of an existing therapy. Rolling Review provides a drug company the opportunity to submit completed sections of its New Drug Application
("NDA") for review by the FDA. Typically, NDA reviews do not commence until the drug company has submitted the entire
application to the FDA. Through the Fast Track designation, the FDA attempts to ensure that questions raised during the drug development
process are resolved quickly, often leading to earlier approval and increased access for patients.
Current
Treatments for Gliomas and Glioblastoma Multiforme
Gliomas
are a type of Central Nervous System ("CNS") tumor that arises from glial cells in the brain or spine. Glial cells
are the cells surrounding nerves. Their primary function is to provide support and protection for neurons in the CNS.
GBM
is the most common and the most lethal form of glioma. According to the Central Brain Tumor Registry of The United States, GBM
occurs with an incidence of 3.20 per 100,000 person-years. Approximately 13,000 new cases of GBM were diagnosed in the United
States and 16,000 in Europe during 2017.
Common
symptoms of GBM include headaches, seizures, nausea, weakness, paralysis and personality or cognitive changes such as loss of
speech or difficulty in thinking clearly. GBM progresses quickly and patients' conditions deteriorate rapidly progressing
to death. The outlook for GBM patients is generally poor. The overall median survival in newly diagnosed GBM patients with best
available treatments is less than 15 months, and two-year and five-year survival rates are approximately 30% and 10%, respectively.
Median overall survival in newly-diagnosed, unmethylated GBM patients is 12.2 months.
In
September 2017, the National Comprehensive Cancer Network ("NCCN"), updated treatment guidelines for GBM. The recommended
treatment regimen for GBM includes surgical resection to remove as much of the tumor as possible ("debulking") followed
by radiotherapy with concomitant and adjuvant chemotherapy with temozolomide with or without tumor treating fields ("TTF").
GBM patients whose tumors exhibit an unmethylated promotor for the gene encoding the DNA repair enzyme MGMT, a biomarker correlated
with resistance to temozolomide, may be treated with radiation alone following surgery.
38
Patients
with an unmethylated MGMT promotor have high levels of MGMT, a naturally-occurring DNA repair enzyme that repairs tumor-fighting
lesions induced by TMZ thus allowing a patient's tumor to continue to grow despite treatment which leads to poor outcomes.
Measurement of MGMT methylation status has become routine in clinical practice as biomarker that correlates with response to TMZ
and patient outcomes in GBM.
Probability
of GBM Patient Survival Correlated to Expression of MGMT Enzyme
(Unmethylated promoter = High MGMT Expression and Significantly Shorter Survival)
TTF
(Optune
®
) is a non-invasive technique for adults with GBM. TTF uses alternating electrical fields to disrupt tumor
cell division, or cause cell death, thereby preventing the tumor from growing or spreading as quickly. A clinical study reported
that GBM patients treated with TTF combined with TMZ experienced longer survival than those treated with TMZ alone.
The
majority of GBM patients' tumors recur within 6 – 12 months of initial treatment. Experimental therapy through clinical
studies is recommended under NCCN guidelines for eligible patients. NCCN guidelines also recommend treatment with systemic chemotherapy,
such as lomustine ("CCNU"). For patients who are eligible for additional surgical debulking, local chemotherapy with
carmustine ("BCNU") wafers may be employed. CCNU and BCNU target the same DNA-site as TMZ and are also subject to
MGMT-related resistance.
Avastin
(Avastin
®
, an anti-VEGF antibody) recently received full approval in the US, Canada, Australia, and Japan as a
single agent for patients with recurrent GBM following prior therapy. Avastin carries an FDA "black-box warning" related
to severe, sometimes fatal, side effects such as gastrointestinal perforations, wound healing complications and hemorrhage. There
are no data demonstrating an improvement in disease-related symptoms or increased survival for GBM patients treated with Avastin.
Recurrent
GBM patients, especially those whose tumors progress following treatment with Avastin, have limited or no treatment options and
a very poor prognosis. According to published literature, the median survival for GBM patients whose tumors progress following
Avastin is less than five months.
VAL-083
Mechanism of Action and the Opportunity in the Treatment of Cancer
Chemotherapy
forms the basis of treatment in nearly all cancers. We believe that VAL-083 may be effective in treating tumors exhibiting biological
features that cause resistance to currently available chemotherapy, particularly for patients who have failed, or become resistant
to, other treatment regimens.
Based
on published research and our own data, the cytotoxic functional groups, and the mechanism of action of VAL-083 are functionally
different from alkylating agents commonly used in the treatment of cancer. VAL-083 has previously demonstrated activity in cell-lines
that are resistant to other types of chemotherapy. No evidence of cross-resistance has been reported in published clinical studies.
Our
research suggests that VAL-083 attacks cancer cells via a unique mechanism of action which is distinct from other chemotherapies
used in the treatment of cancer. Our data indicate that VAL-083 forms inter-strand crosslinks at the N
7
position of
guanine on the DNA of cancer cells. Our data also indicate that this crosslink forms rapidly and is not easily repaired by the
cancer cell resulting in cell-cycle arrest and lethal double-strand DNA breaks in cancer cells. VAL-083 readily crosses the blood
brain barrier. Published preclinical and clinical research demonstrate that VAL-083 is absorbed more readily in tumor cells than
in normal cells.
In
vitro
, our data also demonstrate that VAL-083's distinct mechanism may be able to overcome drug resistance against a
range of cancers. For example, VAL-083 is active against MGMT-unmethylated GBM cells which are resistant to treatment with temozolomide
and nitrosoureas. VAL-083 also retains a high level of activity in p53 mutated non-small cell lung cancer ("NSCLC"),
ovarian cancer and medulloblastoma cell lines that are resistant to platinum-based chemotherapy.
39
Importantly,
clinical activity against each of the tumors mentioned above was established in prior NCI-sponsored Phase 2 clinical studies.
We believe that these historical clinical data and our own research support the development of VAL-083 as a potential new treatment
for multiple types of cancer.
The
main dose-limiting toxicity ("DLT") related to the administration of VAL-083 in previous NCI-sponsored clinical studies
and our own clinical studies is myelosuppression, particularly thrombocytopenia. Myelosuppression, including thrombocytopenia,
is a common side effect of chemotherapy. Myelosuppression is the decrease in cells responsible for providing immunity, carrying
oxygen, and causing normal blood clotting. Thrombocytopenia is a reduction in platelet counts which assist in blood clotting.
Modern medicine allows for better management of myelosuppressive side effects. We believe this offers the potential opportunity
to improve upon the drug's already established efficacy profile by substantially increasing the dose of VAL-083 that can
be safely administered to cancer patients.
There
is no evidence of lung, liver, or kidney toxicity even with prolonged treatment by VAL-083. Data from the Chinese market where
the drug has been approved for more than 15 years supports the safety findings of the NCI studies.
VAL-083
Historical Data
VAL-083
is first-in-class DNA targeting agent that readily crosses the blood-brain-barrier. Data from prior NCI-sponsored clinical studies
with VAL-083 demonstrate activity against GBM and other CNS tumors. In general, historical NCI-sponsored studies demonstrate that
tumor regression in brain cancer was achieved in 40% of patients treated and stabilization was achieved in an additional 20% to
30% of brain tumor patients following treatment with VAL-083. In these studies, VAL-083 demonstrated statistically significant
improvement in the median survival of high-grade glioma brain tumors, including GBM when combined with radiation versus radiation
alone (p < 0.05) with results similar, or superior to, other chemotherapies approved for the treatment of GBM.
A
Summary of Published Data adapted from Separate Sources Comparing the Efficacy of VAL-083
and Other Therapies in the Treatment of GBM
Comparative Therapy
Median Survival Benefit
vs.
Chemotherapy
Radiation (XRT) Alone
Radiation + Chemotherapy
XRT alone
VAL-083
(Eagan 1979)
8.4 months
16.8 months
8.4 months
Temozolomide (Temodar
®
)
(Stupp 2005)
12.1 months
14.6 months
2.5 months
Lomustine (CCNU)
(Walker 1976)
11.8 months
13 months
1.2 months
Carmustine (BCNU)
(Reagan 1976)
10 months
12.5 months
2.5 months
Semustine (ACNU)
(Takakura 1986)
12 months
14 months
2.0 months
VAL-083
is Active Independent of MGMT
We
have presented data at several peer reviewed meetings demonstrating that VAL-083 is active independent of MGMT resistance in GBM
cell lines and other CNS tumor cells. Our research, along with that of others, demonstrates that VAL-083's unique cytotoxic
mechanism forms DNA cross-links at the N
7
position of guanine and retains cytotoxic activity independent of MGMT expression
in vitro
. Our studies demonstrate that VAL-083 has more potent activity against brain tumor cells in comparison to TMZ
and overcomes resistance associated with MGMT, suggesting the potential to surpass the current standard-of-care in the treatment
of GBM.
40
A
Summary of Our Data Demonstrating that VAL-083's Anti-Tumor Mechanism is
Distinct from, and can Overcome, MGMT-Related Chemo resistance in the Treatment of GBM
In
addition, historical NCI clinical study data and our own research support the activity of VAL-083 as a potentiator of radiotherapy.
Radiotherapy in combination with temozolomide is the current standard of care in the treatment of newly diagnosed GBM. Our research
demonstrates that temozolomide and radiotherapy are ineffective against GBM cells exhibiting a high expression of MGMT, whereas
VAL-083 potentiates the tumor-killing effect of radiation independent of MGMT expression. Furthermore, the combination of VAL-083
and radiation has been demonstrated to be active against GBM cancer stem cells ("CSCs") in vitro. CSCs are often resistant
to chemotherapy and form the basis for tumor recurrence and metastasis. GBM CSCs display strong resistance to TMZ, even where
MGMT expression is low. However, our data demonstrates that GBM CSCs are susceptible to VAL-083 independent of MGMT expression.
A
Summary of Our Data Demonstrating that VAL-083 Maintains Activity in Both Temozolomide-resistant GBM Cell Lines and Matched Cancer
Stem Cells and Potentiates Radiotherapy
We
believe that VAL-083's more potent activity against brain tumor cells in comparison to TMZ, VAL-083's ability to overcome
MGMT-mediated resistance, and its activity against GBM CSCs suggests the potential of VAL-083 to surpass the current standard-of-care
in the treatment of GBM.
Phase
1 – 2 Clinical Study Overview and Summary of Results
In
an open-label, single arm dose-escalation study designed to evaluate the safety, tolerability, pharmacokinetics, and anti-cancer
activity of VAL-083, we enrolled forty-eight GBM patients whose disease progressed following prior treatment with temozolomide
and Avastin. The study was conducted at five centers in the United States: the Mayo Clinic in Rochester, Minnesota; the Brain
Tumor Center at University of California, San Francisco; the Sarah Cannon Cancer Research Center in Nashville, Tennessee and Denver,
Colorado; and the SCRI affiliate site at the Florida Cancer Specialist Research Institute in Sarasota, Florida.
Patients
received VAL-083 on days 1, 2 and 3 on a 21-day treatment cycle. The Phase 1 portion of the study involved dose escalation cohorts
until a maximum tolerated dose ("MTD") was established at 40mg/m
2
. A further 14-patient, Phase 2 expansion
was then enrolled at the MTD to gather further safety data at our chosen therapeutic dose and to further explore the outcomes
in this patient population.
In
May 2016, we held an end of Phase 2 meeting with the FDA in which we discussed with the FDA the design of a Phase 3, registration-directed
clinical program for VAL-083 in refractory GBM. Based on the input we received from the FDA, the agency confirmed that it would
consider the totality of data available, including data obtained from our other planned clinical studies in related GBM populations,
when assessing the NDA. The FDA also noted that we may be able to rely on prior NCI studies and historical literature to support
nonclinical data required for an NDA filing under a 505(b)(2) strategy which allows a sponsor to rely on already established safety
and efficacy data in support of an NDA.
41
In
summary, the data from our previous Phase 1/2 study are as follows:
Safety
and Tolerability
In
the Phase 1 dose escalation regimen, no serious adverse events ("SAE") related to VAL-083 were encountered at doses
up to 40 mg/m
2
/day.
Increasing
frequency of, and higher grade, hematologic toxicities were observed at doses above 40 mg/m
2
/day. Consistent with the
published literature, the observed dose limiting toxicity for VAL-083 is primarily thrombocytopenia (low platelets). Observed
platelet nadir occurred at approximately day 18, and recovery was rapid and spontaneous following treatment.
Based
on Phase 1 observations, fourteen additional patients were enrolled in a Phase 2 expansion cohort at 40mg/m
2
, which
was established as the MTD. Consistent with Phase 1, the dose of VAL-083 of 40 mg/m
2
on days 1, 2 and 3 of a 21-day
cycle was generally well tolerated in Phase 2. At this dose, one subject previously treated with CCNU, a nitrosourea agent, reported
severe (Grade 4) thrombocytopenia. As a result of this observation, the protocol inclusion criterion for platelet count was increased
from 100,000/μL to 150,000/μL for patients receiving prior nitrosoureas within 12 weeks preceding enrollment. No other dose
limiting toxicities were observed.
VAL-083
Safety Observations from Phase 1/2 Clinical Study
Hematologic parameter and CTCAE grade
dose
≤30 mg/m
2
40 mg/m
2
45 mg/m
2
50 mg/m
2
n =
20
17
4
7
Anemia
≤G2
11
55
%
2
12
%
2
50
%
6
86
%
G3
2
10
%
—
0
%
—
0
%
—
0
%
G4
—
0
%
—
0
%
—
0
%
—
0
%
Leukopenia
≤G2
5
25
%
2
12
%
—
0
%
5
71
%
G3
1
5
%
—
0
%
—
0
%
3
43
%
G4
—
0
%
—
0
%
2
50
%
—
0
%
Neutropenia
≤G2
4
20
%
—
0
%
—
0
%
—
0
%
G3
—
0
%
—
0
%
—
0
%
3
43
%
G4
—
0
%
—
0
%
2
50
%
1
14
%
Thrombocytopenia
≤G2
9
45
%
3
18
%
—
0
%
3
43
%
G3
—
0
%
—
0
%
1
25
%
3
43
%
G4
—
0
%
1
6
%
2
50
%
1
14
%
DLT Observed
nil
1
2
2
Doses
Achieved
Based
the results of our Phase 1/2 study, we confirmed that we achieved doses of VAL-083 that are higher than were utilized in the original
published NCI-sponsored clinical studies. A summary in comparison to the NCI's historical regimen is as follows:
Dosing Regimen & Study
Single Dose
Acute Regimen
(single cycle)
Comparative
Cumulative Dose
(@ 35 days)
Dose Intensity
(dose per week)
NCI GBM historical regimen
(Eagan et al)
daily x 5 q 5wks
(cycle = 35 days)
25 mg/m
2
x5 days = 125 mg/m
2
125 mg/m
2
25 mg/m
2
/wk.
DelMar VAL-083 achieved
regimen daily x 3 q 3wks
(cycle = 21 days)
40 mg/m
2
x 3 days = 120 mg/m
2
240 mg/m
2
40 mg/m
2
/wk.
Daily
x 5 q 5wks refers to a dosing regimen of once per day for five consecutive days every five weeks (35-day cycle); while daily x
3 q 3wks refers to a dosing regimen of once per day for three consecutive days every three weeks (21-day cycle).
42
Our
achieved dosing regimen increased the amount of VAL-083 delivered to the CNS over historical regimens without increased toxicity.
Thus, our regimen achieved both a higher maximum concentration and higher overall exposure, which we believe may increase the
likelihood of successful treatment outcomes in glioblastoma and other brain tumors.
Based
on our ongoing Phase 2 study at MDACC, we believe that the safety profile of the 40 mg/m
2
is within the existing safety
monitoring guidelines described in the present study protocol. However, in consultation with the principal investigator at MDACC,
we have amended the protocol for the study to modify the starting dose of VAL-083 to 30 mg/m
2
on days 1, 2 and 3, of
a 21-day cycle for this specific study population which has been previously treated with temozolomide. We believe this modification
may improve tolerance in this patient population and maximize overall exposure to VAL-083 thereby increasing the number of cycles
of drug patients are able to receive. The 30 mg/m
2
dosing regimen is 20% over the historical regimen.
Pharmacokinetics
Pharmacokinetic
("PK") analyses showed dose-dependent linear systemic exposure with a short (1-2h) plasma terminal half-life; average
Cmax at 40 mg/m
2
/day was 781 ng/mL (5.3µM). The observed PK profile is comparable to published literature. Prior
NCI-sponsored studies demonstrated that VAL-083 readily crosses the blood brain barrier and has a long (>20 hour) half-life
in the CNS.
We
believe that this PK profile is optimal for the treatment of brain tumors: A long CNS half-life is expected to maximize exposure
of the drug in the brain increasing the likelihood of successful treatment outcomes, while a short plasma half-life is desirable
to minimize systemic side effects.
Observed
pharmacokinetics from VAL-083 Phase 1 clinical study dose vs. AUC
Based
on observed and previously published pharmacokinetics, we believe that therapeutic doses equal to, or above, 20 mg/m
2
daily
on days 1, 2 and 3 of a 21-day cycle should deliver sufficient levels of VAL-083 to brain tumors to achieve a therapeutic benefit.
We are currently using a dose of 30 mg/m
2
daily on days 1, 2 and 3 of a 21-day cycle in our two Phase 2 studies that
are currently ongoing.
MGMT
& IDH1
High
expression of MGMT and wild-type form of the enzyme isocitrate dehydrogenase ("IDH1") have been previously shown to
be diagnostic markers that correlate with resistance to currently available chemotherapies (e.g. temozolomide or nitrosourea)
in the treatment of GBM and poor patient outcomes. Measurement of these biomarkers has become routine in clinical practice.
Notably,
we have previously demonstrated that VAL-083's anti-tumor mechanism is active independent from the MGMT status
in vitro
.
We believe we will ultimately be able to use such biomarkers in a prognostic fashion to select the patients most likely to respond
to treatment as we expand the clinical development of VAL-083.
Biomarker
Observation in
Phase 1/2
clinical study
High MGMT (n=19)
84
%
IDH-WT (n=11)
90
%
Tumor
Response and Outcomes
GBM
patients in our Phase 1/2 clinical study were not re-resected prior to treatment with VAL-083 and therefore had a growing recurrent
GBM tumor at the time of enrollment. Patients were monitored for tumor response by MRI.
43
Consistent
with un-resected GBM, median progression free survival ("PFS") was short at 1.2 months (range: 0.2 – 20.1 months).
Five GBM patients treated with VAL-083 were reported to have stable disease as their best response following treatment; the remainder
reported progressive disease.
Disease
progression is typical in a refractory GBM population with non-resected tumors. However, we believe that slowed progression may
provide meaningful clinical benefit in this patient population through prolonged overall survival and improved quality of life.
According
to published literature, GBM patients failing Avastin have a poor prognosis with expected survival under five months.
Analysis
of twenty-two patients receiving an assumed therapeutic dose of VAL-083 (≥20mg/m
2
) demonstrated median survival
of 8.35 months following Avastin failure.
VAL-083
compared to published literature
Reference
Post Avastin Salvage Therapy
Median Survival following
Avastin Failure
Shih (2016)
VAL-083
8.35 months
Rahman (2014)
nitrosourea
4.3 months
Mikkelson (2011)
TMZ + irinotecan
4.5 months
Lu (2011)
dasatinib
2.6 months
Reardon (2011)
etoposide
4.7 months
Reardon (2011)
TMZ
2.9 months
Iwomoto (2009)
various
5.1 months
While
recognizing these data are representative of a relatively small, non-controlled Phase 1/2 clinical study, we believe these outcomes
support the potential of VAL-083 to offer meaningful clinical benefit to GBM patients who have failed Avastin, compared to currently
available therapy.
VAL-083
Historical Data and Our Research in Ovarian Cancer
Ovarian
cancer is the fifth most common cancer in women and is the leading cause of death among women diagnosed with gynecological malignancies.
In 2016, approximately 22,300 women in the US were diagnosed with ovarian cancer and 14,300 died from their disease.
Without
treatment, ovarian cancer spreads within the pelvic region and metastasizes to distant sites such as the lungs, liver, spleen
and, rarely, the brain. The initial symptoms of ovarian cancer such as abdominal bloating, indigestion, pelvic pain, or nausea
are often attributed to symptoms caused by a less serious condition. Therefore, in most cases, ovarian cancer is not diagnosed
until it has progressed to an advanced stage when it is no longer possible to surgically remove all tumor tissue.
When
diagnosed at an advanced stage the 5-year survival rate is less than 40%. Women with ovarian cancer receive chemotherapy following
surgery to treat residual disease.
VAL-083's
activity against ovarian epithelial adenocarcinoma ("OEA") and squamous cell carcinoma of the cervix ("SCC")
was reported in prior NCI-sponsored clinical studies. Importantly, NCI-researchers recommended VAL-083 for further advanced studies
in the treatment of ovarian cancer.
Pt-based
chemotherapy is employed in the treatment of nearly 50% of all cancer patients and is employed in the treatment regimen of nearly
all advanced-stage ovarian cancer patients. Ovarian cancer patients whose tumors are sensitive to Pt-based chemotherapy have the
most favorable outcome. Recently, the approval of PARP inhibitors in the treatment of ovarian cancer patients demonstrated improved
outcomes, particularly patients whose tumors remain sensitive to Pt-based treatments.
Pt-based
chemotherapies function by causing extensive damage to a cancer cell's DNA. Cancer cells are adept at overcoming DNA damage
or employing mechanisms to repair DNA damage induced by Pt-based chemotherapy. One of the most common obstacles to DNA-damaging
chemotherapy is mutations to a gene called p53. Cellular processes governed by the p53 gene are critical in assessing DNA damage
and determining if a cell should cease from dividing or self-destruct. When p53 does not function properly, cancer cells continue
to divide despite the treatment with DNA-damaging chemotherapy, making these drugs ineffective and leading to treatment resistance.
This occurs in nearly all cases of the most difficult ovarian cancer to treat — high grade serous ovarian cancer (HGSOC)
— which accounts for up to 70% of ovarian cancer cases and approximately 90% of ovarian cancer deaths. P53 mutations are
associated with resistance to Pt-based chemotherapy, which leads to treatment failure and increased mortality. Solving this problem
is a major goal in the development of new treatments for ovarian cancer.
Unfortunately,
the development of resistance to Pt-based agents is nearly inevitable, leading to disease recurrence and increased mortality.
Ultimately, most women with advanced ovarian cancer develop recurrent disease with progressively shorter disease-free intervals.
Those whose tumors recur within 6 months of Pt-based therapy are considered Pt-resistant/refractory and have a very poor prognosis.
The
response rate to second line therapy for Pt-resistant ovarian cancer patients is in the 10-15% range and overall survival is approximately
12 months. The development of new chemotherapies and targeted agents to overcome Pt resistance in ovarian cancer is a significant
unmet medical need.
We
have presented data demonstrating that VAL-083's distinct mechanism of action allows activity in tumors that are resistant
to other therapies. We have shown that cytotoxicity of VAL-083 against ovarian cancer is independent of sensitivity to cisplatin
or p53 status
in vitro.
We have demonstrated that VAL-083 is active in Pt-resistant ovarian cells harboring a range of
p53-mutations.
44
Our
research has demonstrated that VAL-083 not only overcomes Pt resistance, but the combination of VAL-083 with Pt-based chemotherapy
displays synergy in multiple models
in vitro
and
in vivo.
This further suggests a distinct mechanism of action and
potential use as part of a VAL-083/Pt-combination therapy.
The
combination of VAL-083 with either cisplatin
(A)
or oxaliplatin
(B)
in the human H460 (WT p53) NSCLC model demonstrated
significant super additivity (p≤0.05) and/or synergism (CI<1) for both combinations. This cytotoxic effect of VAL-083 in
combination with either platinum drug was observed also in A549 (WT p53) and H1975 (mutant p53) NSCLC cells, independently of
p53 status (not shown). Data, where applicable, are shown as mean ± SE; N=7.
While
Pt-based chemotherapy is the standard treatment for ovarian cancer, PARP inhibitors have recently provided a new treatment option
for a subset of patients with platinum-sensitive recurrent ovarian cancer. VAL-083 also demonstrates synergistic activity with
certain PARP inhibitors, including olaparib (Lynparza) and talazoparib
in vitro
, suggesting VAL-083 may have utility in
the treatment of ovarian cancer in combination with PARP inhibitors.
We
believe that these data demonstrate the potential of VAL-083 to treat platinum-resistant ovarian cancers as a single-agent against
platinum-resistant tumors in combination with platinum-based chemotherapeutic regimens or in combination with PARP inhibitors.
45
Other
Indications for VAL-083 — Potential Future Opportunities
VAL-083
in Lung Cancer
Lung
cancer is a leading cause of cancer death around the world and effective treatment for lung cancer remains a significant global
unmet need despite advances in therapy. Incidence of lung cancer in the United States is approximately 47 per 100,000 with the
majority (85%) being NSCLC, the most common type of lung cancer. Globally, the market for lung cancer treatment may exceed $24
billion by 2033 according to a report published by Evaluate Pharma.
The
activity of VAL-083 against solid tumors, including lung cancer, has been established in both preclinical and human clinical studies
conducted by the NCI. DelMar has developed new nonclinical data to support the utility of VAL-083 in the modern treatment of lung
cancer. In an established murine xenograft model of NSCLC, the activity of VAL-083 was compared to standard platinum-based therapy
with cisplatin against human NSCLC cell lines A549 (TKI-sensitive) and H1975 (TKI-resistant). In the study, VAL-083 demonstrated
superior efficacy and safety in the treatment of TKI-susceptible (A549) tumors and in TKI-resistant (H1975) tumors.
Central
Nervous System Metastases of Solid Tumors
The
successful management of systemic tumors by modern targeted therapies has led to increased incidence of mortality due to CNS metastases
of lung cancer and other solid tumors. In June 2013, we split our Phase 1/2 clinical study protocol into two separate studies:
one focusing solely on refractory GBM and the other focusing on secondary brain cancers caused by other tumors that have spread
to the brain.
Based
on historical clinical activity and our own research, we believe that VAL-083 may be suitable for the treatment of patients with
CNS metastases who currently have limited treatment options. Subject to the availability of financial and operating resources,
we plan to develop a separate protocol for the continued exploration of VAL-083 in patients with secondary brain cancer caused
by a solid tumor spreading to the brain.
Pediatric
Brain Tumors
Tumors
of the brain and spine make up approximately 20 percent of all childhood cancers and they are the second most common form of childhood
cancer after leukemia.
The
activity of VAL-083 against childhood and adolescent brain tumors has been established in both preclinical and human clinical
studies conducted by the NCI. We have presented data indicating that VAL-083 offers potential therapeutic alternatives for the
treatment of pediatric brain tumors including SHH-p53 mutated medulloblastoma. In March 2016, the FDA granted orphan drug designation
for the use of VAL-083 in the treatment of medulloblastoma. Subject to the availability of resources, we intend to collaborate
with leading academic researchers for the continued exploration of VAL-083 as a potential treatment of childhood brain tumors.
Additional
Indications for VAL-083
In
historical studies sponsored by the NCI in the United States, VAL-083 exhibited clinical activity against a range of tumor types
including central nervous system tumors, solid tumors, and hematologic malignancies. We have established new nonclinical data
supporting the activity of VAL-083 in different types of cancer that are resistant to modern targeted therapies and we believe
that the unique cytotoxic mechanism of VAL-083 may provide benefit to patients in a range of indications. We intend to continue
to research these opportunities, and if appropriate, expand our clinical development efforts to include additional indications.
VAL-083
Target Markets
DNA-targeting
agents such as alkylating agents or platinum-based chemotherapy form the mainstay of chemotherapy treatments used in the treatment
of cancers. For example, TMZ had peak annual sales of $1.1 billion in 2010, while bendamustine, had peak annual sales of $0.8
billion in 2014.
Our
product candidate, VAL-083, is a first-in-class DNA targeting agent with a novel mechanism of action. VAL-083's anti-cancer
activity was established in a range of tumor types in prior NCI-sponsored clinical studies. Based on this novel mechanism, we
have demonstrated that the anti-cancer activity is maintained against tumor cells that are resistant to other DNA-targeting agents.
We believe this positions VAL-083 as a potential chemotherapy-of-choice for patients whose tumors are resistant to current standard-of-care
chemotherapy in orphan and major cancer indications.
Our
ongoing research and development activities are focused on indications where VAL-083 demonstrated promising activity in prior
NCI-sponsored studies and where our research suggests an opportunity to address significant unmet medical needs due to the failure
of existing treatments.
VAL-083 target markets
2024
                                         Estimated
Global Sales
Glioblastoma multiforme (GBM)
$
1.5 B
Ovarian Cancer
$
4.2 B
Non-small cell lung cancer (NSCLC)
$
32.6 B
Source: Evaluate Pharma
46
Glioblastoma
Multiforme
GBM
is the most common and the most lethal form of glioma. According to the Central Brain Tumor Registry of The United States, GBM
occurs with an incidence of 3.20 per 100,000 person-years. Approximately 13,000 new cases of GBM were diagnosed in the United
States and 16,000 in Europe during 2017.
Newly
diagnosed patients suffering from GBM are initially treated through invasive brain surgery, although disease progression following
surgical resection is nearly 100%. Temozolomide (Temodar
®
) in combination with radiation is the front-line therapy
for GBM following surgery. Global revenues of branded Temodar reached $1.1 billion in 2010. Approximately 60% of GBM patients
treated with Temodar
®
experience tumor progression within one year. Median overall survival in newly-diagnosed,
unmethylated GBM patients is 12.2 months.
Bevacizumab
(Avastin
®
) has been approved for the treatment of GBM in patients failing Temodar
®
. In clinical
studies, approximately 20% of patients failing Temodar
®
respond to Avastin
®
therapy and no improvement
in median survival was reported.
The
market for refractory (Avastin-failed) GBM is limited to those jurisdictions where Avastin is approved for the treatment of GBM.
The United States, Canada, Australia, Japan and Switzerland represent the major markets where Avastin is used in the treatment
of GBM.
Ovarian
Cancer
The
American Cancer Society estimates that approximately 22,000 women will receive a new diagnosis of ovarian cancer and approximately
14,000 women will die from ovarian cancer in the United States each year. Ovarian cancer ranks fifth in cancer deaths among women,
accounting for more deaths than any other cancer of the female reproductive system.
The
potential of VAL-083 in the treatment of ovarian cancer has been established in prior NCI-sponsored clinical studies and by our
recent research. The FDA has granted orphan drug status to VAL-083 as a potential treatment for ovarian cancer and we have recently
received notice of allowance for our IND to initiate a Phase 1-2 clinical study to investigate the safety and effectiveness of
VAL-083 in patients with recurrent platinum resistant ovarian cancer (VAL-083 REPROVe study).
Ovarian
cancers are commonly treated with a platinum-based chemotherapy regimen. Initial tumor response rates are relatively high. However,
the development of resistance to Pt-based chemotherapy in ovarian cancer patients is nearly inevitable. Our research suggests
that VAL-083 may offer a potential treatment option for ovarian cancer patients who are resistant to platinum-based chemotherapy
and as a potential combination therapy with other agents. We believe the profile of VAL-083 offers the potential to capture meaningful
market share in the multi-billion ovarian cancer market.
Lung
Cancer
Lung
cancer is the most common cancer in the world with 1.8 million cases in 2012, representing 13% of all cancers. According to the
American Lung Association, lung cancer is the leading cancer killer in both men and women in the U.S. During 2018, an estimated
234,030 new cases of lung cancer were expected to be diagnosed.
The
potential of VAL-083 in the treatment of NSLSC has been established in both human clinical studies conducted by the NCI and by
the drug's commercial approval in China. We believe the profile of VAL-083 offers the potential to capture meaningful market
share in the multi-billion NSCLC market.
VAL-083
Manufacturing
VAL-083
is a small-molecule chemotherapeutic. Chemical synthesis of the active pharmaceutical ingredient ("API") was initially
established by the NCI. We have made improvements to this process and have obtained patents on these improvements. The current
manufacturing process involves fewer than five synthetic steps.
VAL-083
drug product is a lyophilized (freeze-dried) formulation that is reconstituted for intravenous injection. We anticipate that overall
cost of goods for an eventual commercial product will be similar to other injectable, small-molecule pharmaceuticals.
Until
recently, supply of VAL-083 for our clinical studies has been provided through our collaboration with Guangxi Wuzhou Pharmaceutical
Company. Guangxi Wuzhou Pharmaceutical Company as a manufacturer has established a commercial-scale manufacturing process based
on the North American process originally developed for the NCI that has been licensed by the CFDA for commercial supply of VAL-083
in China. However, to-date, they have not achieved the quality of systems necessary to meet FDA manufacturing standards.
To
address the need to meet FDA standards, we have engaged third-party contract manufacturers with the capabilities to establish
the processes, procedures and quality systems necessary to meet U.S., Canadian, E.U. and other international manufacturing requirements
in accordance with Good Manufacturing Practice ("cGMP") regulations. We have now received drug supply manufactured
under full cGMP conditions. We intend to use this drug supply for all future clinical studies.
47
We
have developed and patented certain intellectual property related to quality controls that are used in the release of VAL-083
for our clinical studies in the United States. This intellectual property is also required for product release under CFDA guidelines
and we have granted access to our intellectual property for this purpose.
Research
& Development Collaborations
Guangxi
Wuzhou Pharmaceutical Company
Pursuant
to a memorandum of understanding and collaboration agreement, dated October 25, 2012, we have established a strategic collaboration
with Guangxi Wuzhou Pharmaceutical Company, a subsidiary of publicly traded Guangxi Wuzhou Zhongheng Group Co., Ltd. (SHG: 600252)
(the "Guangxi Agreement"). VAL-083 is approved for the treatment of chronic myelogenous leukemia ("CML")
and lung cancer in China and Guangxi Wuzhou Pharmaceutical Company is the only manufacturer licensed by the CFDA to produce the
product for the China market. Through the Guangxi Agreement, we have been provided drug product at the production price for our
VAL-083 clinical studies in the United States and China and we have also secured certain commercial rights in China.
Pursuant
to the Guangxi Agreement, we granted to Guangxi Wuzhou Pharmaceutical Company a royalty-free license to certain of our intellectual
property, as it relates to quality control and drug production methods for VAL-083, and we agreed that Guangxi Wuzhou Pharmaceutical
Company will be our exclusive supplier of VAL-083 for clinical studies and commercial sales, subject to Guangxi Wuzhou Pharmaceutical
Company obtaining and maintaining cGMP certification by the FDA, EMA or other applicable regulatory agencies, and Guangxi Wuzhou
Pharmaceutical Company being able to meet volumes ordered by us. We will continue to work with Guangxi Wuzhou Pharmaceutical Company
to achieve US FDA compliance in order to potentially have them as our future supplier for global sales of VAL-083.
This
Guangxi Agreement also provides us with certain exclusive commercial rights related to drug supply. Specifically, the Guangxi
Agreement establishes an exclusive supply relationship between us and Guangxi Wuzhou Pharmaceutical Company for the Chinese market
and all markets outside China. Guangxi Wuzhou Pharmaceutical Company agreed that it may not sell VAL-083 for markets outside of
China to any other purchaser other than us, provided that, during the first three years following regulatory clearance for marketing
of VAL-083 in a particular country or region, we meet proposed sales volumes set by Guangxi Wuzhou Pharmaceutical Company for
the country or region. In addition, Guangxi Wuzhou Pharmaceutical Company granted us a pre-emptive right in China (subject to
our acceptance of proposed sales volume and prices) to purchase VAL-083 produced by Guangxi Wuzhou Pharmaceutical Company.
The
term of the Guangxi Agreement (except as it relates to the exclusive rights in the China market) is indefinite, subject to termination
upon written agreement of all parties, or if either party breaches any material term and fails to remedy such breach within 30
days of receipt of notice of the breach, or if any action to be taken thereunder is not agreed to by both parties, provided that
such matter is referred to the chief executive officer of both parties, and they are unable to resolve such matter within 90 days.
No payments have been made to date under the Guangxi Agreement.
Duke
University Collaboration
In
April 2017, we entered into a three-year collaboration with Duke University to evaluate VAL-083 as a front-line treatment for
newly diagnosed patients with GBM. Under the terms of the collaboration, we will fund a series of preclinical studies to be conducted
by Duke University's Glioblastoma Drug Discovery Group to identify molecular characteristics of GBM tumors that are more
likely to respond to VAL-083, and not the standard of care, temozolomide, as a front-line treatment or through combination therapies.
Patents
and Proprietary Rights
Our
success will depend in part on our ability to protect our existing product candidate and the products we acquire or license by
obtaining and maintaining a strong proprietary position. To develop and maintain our position, we intend to continue relying upon
patent protection, orphan drug status, Hatch-Waxman exclusivity, trade secrets, know-how, continuing technological innovations
and licensing opportunities.
We
have filed patent applications claiming the use of, and improvements related to VAL-083. Our patent filings also include proposed
treatment regimens, improvements to the manufacturing process, formulation and composition of the active pharmaceutical ingredient,
and finished dosage forms of VAL-083. We are prosecuting our patent applications in the United States and other jurisdictions
which we deem important for the potential commercial success of VAL-083.
48
Our
patents and patent applications can be summarized in fourteen series as follows:
●
Series I is generally directed
                                    to synthesis of VAL-083.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent No. 8,563,758
Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol
United
    States Patent No. 8,921,585
Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol
United
    States Patent No. 9,085,544
Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol
United
    States Patent No. 9,630,938
Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol
PCT
    Patent Application Serial No.
PCT/US2011/048032
Method
    Of Synthesis Of Substituted Hexitols Such As Dianhydrogalactitol. National phase applications pending and granted in various
    countries.
2031
●
Series
                                         II is generally directed to use of VAL-083 to treat a range of diseases and conditions,
                                         including but not limited to malignancies.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent No. 9,066,918
Compositions
    And Methods To Improve The Therapeutic Benefit Of Suboptimally Administered Chemical Compounds Including Substituted Hexitols
    Such As Dianhydrogalactitol And Diacetyldianhydrogalactitol
United
    States Patent No. 9,901,563
Compositions
    And Methods To Improve The Therapeutic Benefit Of Suboptimally Administered Chemical Compounds Including Substituted Hexitols
    Such As Dianhydrogalactitol And Diacetyldianhydrogalactitol
PCT
    Patent Application Serial No.
PCT/US2011/048031
Compositions
    And Methods To Improve The Therapeutic Benefit Of Suboptimally Administered Chemical Compounds Including Substituted Hexitols
    Such As Dianhydrogalactitol And Diacetyldianhydrogalactitol. National phase applications pending.
2031
●
Series
                                         III is generally directed to analytical methods for VAL-083.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent No. 9,759,698
Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol
United
    States Patent No. 10,145,824
Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol
United
    States Patent No. 9,029,164
Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol
PCT
    Patent Application Serial No.
PCT/IB2013/000793
Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol. National phase applications pending and
    granted in various countries.
2033
Patent
    or Patent Application No.
Title
Expiry
PCT
    Patent Application Serial No.
PCT/US2014/066087
Improved
    Analytical Methods For Analyzing And Determining Impurities In Dianhydrogalactitol. National phase applications pending in
    various countries.
2034
●
Series
                                         IV is generally directed to the use of VAL-083 to treat GBM or medulloblastoma.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 16/242,752
Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma
United
    States Patent No. 9,687,466
Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma
United
    States Patent No. 10,201,521
Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma
PCT
    Patent Application Serial No.
PCT/US2013/022505
Use
    Of Substituted Hexitols Including Dianhydrogalactitol And Analogs To Treat Neoplastic Disease And Cancer Stem Cells Including
    Glioblastoma Multiforme And Medulloblastoma. National phase applications pending in various countries.
2033
49
●
Series
                                         V is generally directed to the veterinary use of VAL-083.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent No. 9,814,693
Veterinary
    Use Of Dianhydrogalactitol, Diacetyldianhydrogalactitol, And Dibromodulcitol To Treat Malignancies
●
Series
                                         VI is generally directed to the use of VAL-083 to treat tyrosine-kinase-inhibitor-resistant
                                         malignancies.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 14/409,909
Methods
    For Treating Tyrosine-Kinase-Inhibitor-Resistant Malignancies In Patients With Genetic Polymorphisms Or Ahi1 Dysregulations
    Or Mutations Employing Dianhydrogalactitol, Diacetyldianhydrogalactitol, Dibromodulcitol, Or Analogs Or Derivatives Thereof
PCT
    Patent Application Serial No.
PCT/US2013/047320
Methods
    For Treating Tyrosine-Kinase-Inhibitor-Resistant Malignancies In Patients With Genetic Polymorphisms Or Ahi1 Dysregulations
    Or Mutations Employing Dianhydrogalactitol, Diacetyldianhydrogalactitol, Dibromodulcitol, Or Analogs Or Derivatives Thereof.
    National phase applications pending in various countries.
2033
●
Series VII is generally directed
                                    to the use of VAL-083 to treat recurrent malignant glioma and progressive secondary brain
                                    tumor.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 14/682,226
Use
    Of Dianhydrogalactitol And Analogs And Derivatives Thereof To Treat Recurrent Malignant Glioma Or Progressive Secondary Brain
    Tumor
PCT
    Application Serial No.
PCT/US2014/040461
Use
    Of Dianhydrogalactitol And Analogs And Derivatives Thereof To Treat Recurrent Malignant Glioma Or Progressive Secondary Brain
    Tumor. National phase applications pending and granted in various countries.
2034
●
Series VIII is generally directed to
                             the use of VAL-083 to treat non-small-cell lung cancer.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 14/710,240
Use
    of Dianhydrogalactitol and Analogs or Derivatives Thereof in Combination With Platinum-Containing Antineoplastic Agents to
    Treat Non Small-Cell Carcinoma of the Lung and Brain Metastases
PCT
    Patent Application Serial No.
PCT/US2015/024462
Use
    of Dianhydrogalactitol and Analogs or Derivatives Thereof to Treat Non-Small Cell Carcinoma of the Lung and Ovarian Cancer.
    National phase applications pending in various countries.
2035
PCT
    Patent Application Serial No.
PCT/US2016/032120
Combination
    of Analogs or Derivatives of Dianhydrogalactitol with Platinum-Containing Antineoplastic Agents to Treat Cancer. National
    phase applications pending in various countries.
2035
●
Series IX is generally directed to the use of VAL-083 and radiation to treat NSCLC and GBM.
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 15/525,933
Dianhydrogalactitol
    Together with Radiation to Treat Non-Small-Cell Carcinoma of the Lung and Glioblastoma Multiforme.
PCT
    Patent Application Serial No.
PCT/US2015/059814
Dianhydrogalactitol
    Together with Radiation to Treat Non-Small-Cell Carcinoma of the Lung and Glioblastoma Multiforme. National phase applications
    pending in various countries.
2035
50
●
Series
                                         X is generally directed to the use of VAL-083 in NSCLC and ovarian cancer:
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 15/759,104
Use
    of Dianhydrogalactitol And Derivatives Thereof in the Treatment of Glioblastoma, Lung Cancer and Ovarian Cancer.
●
Series
                                         XI is generally directed to the use of VAL-083 in the treatment of CNS malignancies:
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 15/624,200
Use
    of Dianhydrogalactitol or Derivatives and Analogs Thereof for Treatment of Pediatric Central Nervous System Malignancies.
United
    States Patent Application Serial No. 15/771,631
Use
    of Dianhydrogalactitol or Derivatives and Analogs Thereof for Treatment of Pediatric Central Nervous System Malignancies.
●
Series XII is generally directed
                                    to the analysis and resolution of VAL-083 preparations:
Patent
    or Patent Application No.
Title
Expiry
United
    States Patent Application Serial No. 15/778,546
Methods
    for analysis and Resolution of Preparations of Dianhydrogalactitol and Derivatives and Analogs Thereof.
PCT
    Patent Application Serial No.
PCT/US2016/063362
Methods
    for analysis and Resolution of Preparations of Dianhydrogalactitol and Derivatives and Analogs Thereof. National phase applications
    pending in various countries.
2036
●
Series
                                         XIII is generally directed to combinations:
Patent
    or Patent Application No.
Title
Expiry
PCT
    Patent Application Serial No. PCT/US2018/020314
Use
    of Dianhydrogalactitol and Analogs and Derivatives in Combination with a P53 Modulator or a PARP Inhibitor
2038
●
Series
                                         XIV — PCT
Patent
    or Patent Application No.
Title
Expiry
One
    PCT is currently pending
One
of the inventors listed in our Series IX applications is an employee of the University of California, San Francisco. If a patent
issues from a patent application in this series with a claim that the University of California employee conceived of, in whole
or in part, then the Regents of the University of California will share ownership of any such patent with us. Our research agreements
with the University of California address this issue by providing us with an exclusive option, for a limited period of time, to
negotiate a royalty-bearing exclusive license for commercialization of the invention covered by that patent.
In
addition to patent protection, we may also seek orphan drug status whenever it is available. If a product which has an orphan
drug designation subsequently receives the first regulatory approval for the indication for which it has such designation, the
product is entitled to orphan exclusivity, meaning that the applicable regulatory authority may not approve any other applications
to market the same drug for the same indication, except in very limited circumstances, for a period of seven years in the U.S.
and Canada, and 10 years in the E.U. Orphan drug designation does not prevent competitors from developing or marketing different
drugs for the same indication or the same drug for a different clinical indication.
VAL-083
has been granted protection under the Orphan Drug Act by the FDA and the European Medicines Agency for the treatment of gliomas,
including GBM. The FDA has also granted Orphan Drug protection to VAL-083 for the treatment of medulloblastoma and ovarian cancer.
In
February 2012, the FDA granted orphan drug status to VAL-083 for the treatment of glioma. In January 2013, the EMA also granted
orphan drug protection to VAL-083 for the treatment of glioma. In the spring of 2016, the FDA Office of Orphan Products Development
granted orphan drug designations to VAL-083 for the treatment of ovarian cancer and medulloblastoma.
In
addition to our patents and orphan drug protection, we intend to rely on the Hatch-Waxman Amendments for five years of data exclusivity
for VAL-083.Under the Hatch-Waxman Amendments, newly approved drugs and indications benefit from a statutory period of non-patent
marketing exclusivity. These amendments provide five-year data exclusivity to the first applicant to gain approval of an NDA for
a new chemical entity, meaning that the FDA has not previously approved any other new drug containing the same active ingredient.
The Hatch-Waxman Amendments prohibit the approval of an abbreviated new drug application, also known as an ANDA or generic drug
application, during the five-year exclusive period if no patent is listed. If there is a patent listed and the ANDA applicant
certifies that the NDA holder's listed patent for the product is invalid or will not be infringed, the ANDA can be submitted
four years after NDA approval. Protection under the Hatch-Waxman Amendments will not prevent the filing or approval of another
full NDA; however, the applicant would be required to conduct its own pre-clinical studies and adequate and well-controlled clinical
studies to demonstrate safety and effectiveness. The Hatch-Waxman Amendments also provide three years of data exclusivity for
the approval of NDAs with new clinical studies for previously approved drugs and supplemental NDAs, for example, for new indications,
dosages or strengths of an existing drug, if new clinical investigations were conducted by or on behalf of the sponsor and were
essential to the approval of the application. This three-year exclusivity covers only the new changes associated with the supplemental
NDA and does not prohibit the FDA from approving ANDAs for drugs containing the original active ingredient.
51
We
also rely on trade secret protection for our confidential and proprietary information. We believe that the substantial costs and
resources required to develop technological innovations, such as the manufacturing processes associated with VAL-083, will help
us to protect the competitive advantage of our product candidate.
The
protection of intellectual property rights in China (where our clinical product candidate, VAL-083, is manufactured pursuant to
a collaboration agreement with the only manufacturer presently licensed by the CFDA to produce the product for the China market,
and where VAL-03 is approved for the treatment of CML and lung cancer) is relatively weak compared to the United States, which
may negatively affect our ability to generate revenue from VAL-083 in China.
Our
policy is to require 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. These agreements provide
that all confidential information developed or made known to the individual during the course of the individual's relationship
with us is to be kept confidential and not disclosed to third parties except in specific circumstances. In the case of employees
and consultants, the agreements provide that all inventions conceived by the individual shall be our exclusive property.
Government
Regulation and Product Approval
Regulation
by governmental authorities in the U.S. and other countries is a significant factor, affecting the cost and time of our research
and product development activities, and will be a significant factor in the manufacture and marketing of any approved products.
Our product candidates will require regulatory approval by governmental agencies prior to commercialization. In particular, our
products are subject to rigorous preclinical and clinical testing and other approval requirements by the FDA and similar regulatory
authorities in other countries. Various statutes and regulations also govern or influence the manufacturing, safety, reporting,
labeling, transport and storage, record keeping and marketing of our products. The lengthy process of seeking these approvals,
and the subsequent compliance with applicable statutes and regulations, require the expenditure of substantial resources. Any
failure by us to obtain, or any delay in obtaining, the necessary regulatory approvals could harm our business.
The
regulatory requirements relating to the testing, manufacturing and marketing of our products may change from time to time and
this may impact our ability to conduct clinical studies and the ability of independent investigators to conduct their own research
with support from us.
The
clinical development, manufacturing and marketing of our products are subject to regulation by various authorities in the U.S.,
the E.U. and other countries, including, in the U.S., the FDA, in Canada, Health Canada, and, in the E.U., the EMA. The Federal
Food, Drug, and Cosmetic Act, the Public Health Service Act in the U.S. and numerous directives, regulations, local laws and guidelines
in Canada and the E.U. govern the testing, manufacture, safety, efficacy, labeling, storage, record keeping, approval, advertising
and promotion of our products. Product development and approval within these regulatory frameworks takes a number of years and
involves the expenditure of substantial resources.
Regulatory
approval will be required in all the major markets in which we seek to develop our products. At a minimum, approval requires the
generation and evaluation of data relating to the quality, safety, and efficacy of an investigational product for its proposed
use. The specific types of data required and the regulations relating to this data will differ depending on the territory, the
drug involved, the proposed indication and the stage of development.
In
general, new chemical entities are tested in animals until adequate evidence of safety is established to support the proposed
clinical study protocol designs. Clinical studies for new products are typically conducted in three sequential phases that may
overlap. In Phase 1, the initial introduction of the pharmaceutical into either healthy human volunteers or patients with the
disease (20 to 50 subjects), the emphasis is on testing for safety (adverse effects), dosage tolerance, metabolism, distribution,
excretion and clinical pharmacology. Phase 2 involves studies in a limited patient population (50 to 200 patients) to determine
the initial efficacy of the pharmaceutical for specific targeted indications, to determine dosage tolerance and optimal dosage
and to identify possible adverse side effects and safety risks. Once a compound shows preliminary evidence of some effectiveness
and is found to have an acceptable safety profile in Phase 2 evaluations, Phase 3 studies are undertaken to more fully evaluate
clinical outcomes in a larger patient population in adequate and well-controlled studies designed to yield statistically sufficient
clinical data to demonstrate efficacy and safety.
In
the U.S., specific preclinical data, manufacturing and chemical data, as described above, need to be submitted to the FDA as part
of an IND application, which, unless the FDA objects, will become effective 30 days following receipt by the FDA. Phase 1 studies
in human volunteers may commence only after the application becomes effective. Prior regulatory approval for human healthy volunteer
studies is also required in member states of the E.U. Currently, in each member state of the E.U., following successful completion
of Phase 1 studies, data are submitted in summarized format to the applicable regulatory authority in the member state in respect
of applications for the conduct of later Phase 2 studies. The regulatory authorities in the E.U. typically have between one and
three months in which to raise any objections to the proposed study, and they often have the right to extend this review period
at their discretion. In the U.S., following completion of Phase 1 studies, further submissions to regulatory authorities are necessary
in relation to Phase 2 and 3 studies to update the existing IND.
52
Authorities
may require additional data before allowing the studies to commence and could demand that the studies be discontinued at any time
if there are significant safety issues. In addition to the regulatory review, studies involving human subjects must be approved
by an independent body. The exact composition and responsibilities of this body will differ from country to country. In the U.S.,
for example, each study will be conducted under the auspices of an independent institutional review board (IRB) at each institution
at which the study is conducted. The IRB considers among other things, the design of the study, ethical factors, the privacy of
protected health information as defined under the Health Insurance Portability and Accountability Act, the safety of the human
subjects and the possible liability risk for the institution. Equivalent rules to protect subjects' rights and welfare apply
in each member state of the E.U. where one or more independent ethics committees, which typically operate similarly to an IRB,
will review the ethics of conducting the proposed research. Other regulatory authorities around the rest of the world have slightly
differing requirements involving both the execution of clinical studies and the import/export of pharmaceutical products. It is
our responsibility to ensure we conduct our business in accordance with the regulations of each relevant territory.
In
order to gain marketing approval, we must submit a dossier to the relevant authority for review, which is known in the U.S. as
a new drug application (NDA) and in the E.U. as a marketing authorization application (MAA). The format is usually specific and
laid out by each authority, although in general it will include information on the quality of the chemistry, manufacturing and
pharmaceutical aspects of the product as well as the nonclinical and clinical data. Once the submitted NDA is accepted for filing
by the FDA, it undertakes the review process that currently takes on average 10 months, unless an expedited priority review is
granted which takes six months to complete. Approval can take several months to several years, if multiple 10-month review cycles
are needed before final approval is obtained, if at all.
The
approval process can be affected by a number of factors. The NDA may require additional preclinical, manufacturing data or clinical
studies which may be requested at the end of the 10-month NDA review cycle, thereby delaying approval until additional data are
submitted and may involve substantial unbudgeted costs.
In
addition to obtaining approval for each product, in many cases each drug manufacturing facility must be approved. The regulatory
authorities usually will conduct an inspection of relevant manufacturing facilities, and review manufacturing procedures, operating
systems and personnel qualifications. Further inspections may occur over the life of the product. An inspection of the clinical
investigation sites by a competent authority may be required as part of the regulatory approval procedure. As a condition of marketing
approval, the regulatory agency may require post-marketing surveillance to monitor for adverse effects or other additional studies
as deemed appropriate. After approval for the initial indication, further clinical studies may be necessary to gain approval for
any additional indications. The terms of any approval, including labeling content, may be more restrictive than expected and could
affect the marketability of a product.
The
FDA offers a number of regulatory mechanisms that provide expedited or accelerated approval procedures for selected drugs in the
indications on which we are focusing our efforts. These include accelerated approval under Subpart H of the agency's NDA
approval regulations, fast track drug development procedures, breakthrough drug designation and priority review. At this time,
we have not determined whether any of these approval procedures will apply to our current drug candidate.
By
leveraging existing preclinical and clinical safety and efficacy data, we seek to build upon an existing knowledge base to accelerate
our research. In addition, through our focus on end-stage population which has no current treatment options, regulatory approval
for commercialization may sometimes be achieved in an accelerated manner. Accelerated approval by the FDA in this category may
be granted on objective response rates and duration of responses rather than demonstration of survival benefit. As a result, studies
of drugs to treat end-stage refractory cancer indications have historically involved fewer patients and generally have been faster
to complete than studies of drugs for other indications. We are aware that the FDA and other similar agencies are regularly reviewing
the use of objective endpoints for commercial approval and that policy changes may impact the size of studies required for approval,
timelines and expenditures significantly.
The
U.S., E.U. and other jurisdictions may grant orphan drug designation to drugs intended to treat a "rare disease or condition,"
which, in the U.S., is generally a disease or condition that affects no more than 200,000 individuals. In the E.U., orphan drug
designation can be granted if: the disease is life threatening or chronically debilitating and affects no more than 50 in 100,000
persons in the E.U.; without incentive, it is unlikely that the drug would generate sufficient return to justify the necessary
investment; and no satisfactory method of treatment for the condition exists or, if it does, the new drug will provide a significant
benefit to those affected by the condition. If a product that has an orphan drug designation subsequently receives the first regulatory
approval for the indication for which it has such designation, the product is entitled to orphan exclusivity, meaning that the
applicable regulatory authority may not approve any other applications to market the same drug for the same indication, except
in very limited circumstances, for a period of seven years in the U.S. and 10 years in the E.U. Orphan drug designation does not
prevent competitors from developing or marketing different drugs for the same indication or the same drug for different indications.
Orphan drug designation must be requested before submitting an NDA or MAA. After orphan drug designation is granted, the identity
of the therapeutic agent and its potential orphan use are publicly disclosed. Orphan drug designation does not convey an advantage
in, or shorten the duration of, the review and approval process. However, this designation provides an exemption from marketing
and authorization fees charged to NDA sponsors under the Prescription Drug Act (PDUFA Fees).
Maintaining
substantial compliance with appropriate federal, state and local statutes and regulations requires the expenditure of substantial
time and financial resources. Drug manufacturers are required to register their establishments with the FDA and certain state
agencies, and after approval, the FDA and these state agencies conduct periodic unannounced inspections to ensure continued compliance
with ongoing regulatory requirements, including cGMPs. In addition, after approval, some types of changes to the approved product,
such as adding new indications, manufacturing changes and additional labeling claims, are subject to further FDA review and approval.
The FDA may require post-approval testing and surveillance programs to monitor safety and the effectiveness of approved products
that have been commercialized. Any drug products manufactured or distributed by us pursuant to FDA approvals are subject to continuing
regulation by the FDA, including:
●
record-keeping requirements;
53
●
reporting of adverse experiences with
                             the drug;
●
providing the FDA with updated
                                    safety and efficacy information;
●
reporting on advertisements and promotional
                             labeling;
●
drug sampling and distribution
                                    requirements; and
●
complying with electronic record and
                             signature requirements.
In
addition, the FDA strictly regulates labeling, advertising, promotion and other types of information on products that are placed
on the market. There are numerous regulations and policies that govern various means for disseminating information to health-care
professionals as well as consumers, including to industry sponsored scientific and educational activities, information provided
to the media and information provided over the Internet. Drugs may be promoted only for the approved indications and in accordance
with the provisions of the approved label.
The
FDA has very broad enforcement authority and the failure to comply with applicable regulatory requirements can result in administrative
or judicial sanctions being imposed on us or on the manufacturers and distributors of our approved products, including warning
letters, refusals of government contracts, clinical holds, civil penalties, injunctions, restitution and disgorgement of profits,
recall or seizure of products, total or partial suspension of production or distribution, withdrawal of approvals, refusal to
approve pending applications, and criminal prosecution resulting in fines and incarceration. The FDA and other agencies actively
enforce the laws and regulations prohibiting the promotion of off-label uses, and a company that is found to have improperly promoted
off-label uses may be subject to significant liability. In addition, even after regulatory approval is obtained, later discovery
of previously unknown problems with a product may result in restrictions on the product or even complete withdrawal of the product
from the market.
Sales
of our product candidates, if approved, will depend, in part, on the extent to which such products will be covered by third-party
payors, such as government health care programs, commercial insurance and managed healthcare organizations. These third-party
payors are increasingly limiting coverage or reducing reimbursements for medical products and services. In addition, the U.S.
government, state legislatures and foreign governments have continued implementing cost-containment programs, including price
controls, restrictions on reimbursement and requirements for substitution of generic products. Third-party payors decide which
therapies they will pay for and establish reimbursement levels. Third-party payors often rely upon Medicare coverage policy and
payment limitations in setting their own coverage and reimbursement policies. However, decisions regarding the extent of coverage
and amount of reimbursement to be provided for any drug candidates that we develop will be made on a payor-by-payor basis. Each
payor determines whether or not it will provide coverage for a therapy, what amount it will pay the manufacturer for the therapy,
and on what tier of its formulary it will be placed. The position on a payor's list of covered drugs, or formulary, generally
determines the co-payment that a patient will need to make to obtain the therapy and can strongly influence the adoption of such
therapy by patients and physicians. 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. Decreases in third-party
reimbursement for our product candidates or a decision by a third-party payor to not cover our product candidates could reduce
physician usage of our product candidates, once approved, and have a material adverse effect on our sales, results of operations
and financial condition.
Because
of our current and future arrangements with healthcare professionals, principal investigators, consultants, customers and third-party
payors, we will also be subject to healthcare regulation and enforcement by the federal government and the states and foreign
governments in which we will conduct our business, including our clinical research, proposed sales, marketing and educational
programs. Failure to comply with these laws, where applicable, can result in the imposition of significant civil penalties, criminal
penalties, or both. The U.S. laws that may affect our ability to operate, among others, include: the federal Health Insurance
Portability and Accountability Act of 1996, or HIPAA, as amended by the Health Information Technology for Economic and Clinical
Health Act, which governs the conduct of certain electronic healthcare transactions and protects the security and privacy of protected
health information; certain state laws governing the privacy and security of health information in certain circumstances, some
of which are more stringent than HIPAA and many of which differ from each other in significant ways and may not have the same
effect, thus complicating compliance efforts; the federal healthcare programs' Anti-Kickback Statute, which prohibits, among
other things, persons from knowingly and willfully soliciting, receiving, offering or paying remuneration, directly or indirectly,
in exchange for or to induce either the referral of an individual for, or the purchase, order or recommendation of, any good or
service for which payment may be made under federal healthcare programs such as the Medicare and Medicaid programs; federal false
claims laws which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented,
claims for payment from Medicare, Medicaid, or other third-party payors that are false or fraudulent; federal criminal laws that
prohibit executing a scheme to defraud any healthcare benefit program or making false statements relating to healthcare matters;
the Physician Payments Sunshine Act, which requires manufacturers of drugs, devices, biologics, and medical supplies to report
annually to the U.S. Department of Health and Human Services information related to payments and other transfers of value to physicians
(defined to include doctors, dentists, optometrists, podiatrists and chiropractors) and teaching hospitals, and ownership and
investment interests held by physicians and their immediate family members; and state law equivalents of each of the above federal
laws, such as anti-kickback and false claims laws which may apply to items or services reimbursed by any third-party payor, including
commercial insurers.
54
In
addition, many states have similar laws and regulations, such as anti-kickback and false claims laws that may be broader in scope
and may apply regardless of payor, in addition to items and services reimbursed under Medicaid and other state programs. Additionally,
to the extent that our product is sold in a foreign country, we may be subject to similar foreign laws.
We
are also subject to numerous environmental and safety laws and regulations, including those governing the use and disposal of
hazardous materials. The cost of compliance with and any violation of these regulations could have a material adverse effect on
our business and results of operations. Although we believe that our safety procedures for handling and disposing of these materials
comply with the standards prescribed by state and federal regulations, accidental contamination or injury from these materials
may occur. Compliance with laws and regulations relating to the protection of the environment has not had a material effect on
our capital expenditures or our competitive position. However, we are not able to predict the extent of government regulation,
and the cost and effect thereof on our competitive position, which might result from any legislative or administrative action
pertaining to environmental or safety matters.
Competition
The
development and commercialization of new drug products is highly competitive. We expect that we will face significant competition
from major pharmaceutical companies, specialty pharmaceutical companies and biotechnology companies worldwide with respect to
VAL-083 and any other product candidates that we may seek to develop or commercialize in the future. Specifically, due to the
large unmet medical need, global demographics and relatively attractive reimbursement dynamics, the oncology market is fiercely
competitive and there are a number of large pharmaceutical and biotechnology companies that currently market and sell products
or are pursuing the development of product candidates for the treatment of cancer. Our competitors may succeed in developing,
acquiring or licensing technologies and drug products that are more effective, have fewer or more tolerable side effects or are
less costly than any product candidates that we are currently developing or that we may develop, which could render our product
candidates obsolete and noncompetitive.
All
of the top ten global pharmaceutical companies and many of the mid-size pharmaceutical companies have a strong research and development
and commercial presence in oncology. Smaller companies also focus on oncology, including companies such as ARIAD Pharmaceuticals,
Inc., Agios Pharmaceuticals, Inc., BIND Therapeutics, Inc., Clovis Oncology, Inc., Endocyte, Inc., Epizyme, Inc., ImmunoGen, Inc.,
Incyte Corporation, Infinity Pharmaceuticals, Inc., MacroGenics, Inc., Merrimack Pharmaceuticals, Inc., OncoMed Pharmaceuticals,
Inc., Onconova Therapeutics, Inc., Pharmacyclics, Inc., Puma Biotechnology, Inc., Seattle Genetics, Inc. and TESARO, Inc.
Several
companies are marketing and developing oncology immunotherapy products. Companies with approved marketed oncology products for
GBM are Merck (Temodar
®
) and Genentech (Avastin
®
). Companies with oncology immunotherapy product
candidates in clinical development include, but are not limited to, Northwest Biotherapeutics (DCVax-L), Celldex Therapeutics
(Rindopepimut (CDX-110)) and ImmunoCellular Therapeutics (ICT-107).
Our
commercial opportunity could be reduced or eliminated if our competitors develop and commercialize products that are safer, more
effective, have fewer or less severe side effects, are more convenient or are less expensive than any products that we may develop.
Our competitors also may obtain FDA or other marketing approval for their products before we are able to obtain approval for ours,
which could result in our competitors establishing a strong market position before we are able to enter the market.
Many
of our existing and potential future competitors have significantly greater financial resources and expertise in research and
development, manufacturing, preclinical testing, conducting clinical studies, obtaining marketing approvals and marketing approved
products than we do. Mergers and acquisitions in the pharmaceutical and biotechnology industries may result in even more resources
being concentrated among a smaller number of our competitors. Smaller or early stage companies may also prove to be significant
competitors, particularly through collaborative arrangements with large and established companies. These competitors also compete
with us in recruiting and retaining qualified scientific and management personnel and establishing clinical study sites and patient
registration for clinical studies, as well as in acquiring technologies complementary to, or necessary for, our programs.
We
expect that our ability to compete effectively will depend upon our ability to:
●
successfully and rapidly complete adequate
                             and well-controlled clinical studies that demonstrate statistically significant safety and efficacy
                             and to obtain all requisite regulatory approvals in a cost-effective manner;
●
maintain a proprietary position for
                             our manufacturing processes and other technology;
●
produce our products in accordance
                                    with FDA and international regulatory guidelines;
●
attract and retain key personnel;
                                    and
●
build or access an adequate sales
                                    and marketing infrastructure for any approved products.
Failure
to do one or more of these activities could have an adverse effect on our business, financial condition or results of operations.
55
Corporate
History
We
are a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. ("Berry"). On January 25, 2013, we
entered into and closed an exchange agreement (the "Exchange Agreement"), with Del Mar Pharmaceuticals (BC) Ltd. ("Del
Mar (BC)"), 0959454 B.C. Ltd. ("Callco"), and 0959456 B.C. Ltd. ("Exchangeco") and the security
holders of Del Mar (BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of ours (the
"Reverse Acquisition"). Prior to the Reverse Acquisition undertaken on January 25, 2013, Berry did not have any significant
assets or operations.
We
are the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010, that is focused
on the development of drugs for the treatment of cancer. We are also the parent company to Callco and Exchangeco which are British
Columbia, Canada corporations. Callco and Exchangeco were formed to facilitate the Reverse Acquisition.
On
May 20, 2016, we effected a one-for-four reverse split of our common stock. All share amounts in this report give effect to the
reverse split unless otherwise indicated.
On
May 8, 2019, we effected a one-for-ten reverse stock split (the "Reverse Stock Split") of our issued and outstanding
and authorized common stock. All per share amounts and number of shares of common stock in this prospectus reflect the Reverse
Stock Split. The Reverse Stock Split does not affect the our authorized preferred stock of 5,000,000 shares; except that, pursuant
to the terms of the Certificate of Designations of Series B Convertible Preferred Stock for the issued and outstanding shares
of our Series B Convertible Preferred Stock, par value $0.001 per share (the "Series B Preferred Stock"), the conversion
price at which shares of Series B Preferred Stock may be converted into shares of common stock will be proportionately adjusted
to reflect the Reverse Stock Split.
Research
and Development
During
the nine-month periods ended March 31, 2019 and 2018, we recognized $2,702,213 and $5,856,197, respectively, in research and development
expenses. During the years ended June 30, 2018 and 2017, we recognized $7,132,952 and $5,003,640, respectively, in research and
development expenses.
Employees
We
have two full-time employees and retain the services of approximately 15 persons on an independent contractor/consultant and contract-employment
basis. As such, we currently operate in a "virtual" corporate structure in order to minimize fixed personnel costs.
Legal
Proceedings
There
are no legal proceedings to which we are a party or any of our property is the subject.
Facilities
Our
corporate headquarters are located at Suite 720-999 West Broadway, Vancouver, British Columbia, Canada, V5Z 1K5. Our clinical
operations are managed at 3475 Edison Way, Suite R, Menlo Park, California, 94025. Our current monthly base rent for our corporate
headquarters is $4,022 (CDN $5,375) on a month-to-month basis. In addition, Valent Technologies, LLC ("Valent"), which
is owned by Dr. Dennis Brown, our Chief Scientific Officer, leases facilities in California and we have access to such facilities
pursuant to an informal unwritten arrangement with Valent. Our leased premises, academic relationships, and access to the Valent
facility are sufficient to meet the immediate needs of our business, research and operations.
56
MANAGEMENT
Executive
Officers and Directors of DelMar
The
following table sets forth information concerning the DelMar directors and executive officers, including their ages as of June
15, 2019. There are no family relationships among any of the DelMar directors or executive officers.
Name
Age
Position
Robert E. Hoffman
53
Chairman of the Board
Saiid Zarrabian
66
President, Chief Executive Officer and Director
Dennis Brown, PhD
70
Chief Scientific Officer
Scott Praill, CPA
53
Chief Financial Officer
John K. Bell, FCPA, CPA
72
Director
Lynda Cranston, BScN, MScN, ICD.D
72
Director
Napoleone Ferrara, MD
62
Director
Robert J. Toth, Jr., MBA
56
Director
The
following biographical descriptions set forth certain information with respect to the DelMar directors and executive officers,
based on information furnished to the Company by each individual.
Robert
E. Hoffman
has served as our director since April 11, 2018 and as our Chairman since June 2, 2018. He has served as a member
of Kura Oncology, Inc.'s Board of Directors since March 2015. Mr. Hoffman has served as Senior Vice President and Chief
Financial Officer of Heron Therapeutics, Inc., a publicly-held pharmaceutical company since April 2017. Prior to joining Heron
Therapeutics, Inc., Mr. Hoffman served as Executive Vice President and Chief Financial Officer of Innovus Pharmaceuticals, Inc.,
a publicly-held pharmaceutical company, from September 2016 to April 2017. From July 2015 to September 2016, Mr. Hoffman served
as Chief Financial Officer of AnaptysBio, Inc., a publicly-held biotechnology company. From June 2012 to July 2015, Mr. Hoffman
served as the Senior Vice President, Finance and Chief Financial Officer of Arena Pharmaceuticals, Inc., or Arena, a publicly-held
biopharmaceutical company. From August 2011 to June 2012 and previously from December 2005 to March 2011, he served as Arena's
Vice President, Finance and Chief Financial Officer and in a number of various roles of increasing responsibility from 1997 to
December 2005. From March 2011 to August 2011, Mr. Hoffman served as Chief Financial Officer for Polaris Group, a biopharmaceutical
drug company. Mr. Hoffman formerly served as a member of the Board of Directors of CombiMatrix Corporation, a molecular diagnostics
company, and MabVax Therapeutics Holdings, Inc., a biopharmaceutical company. Mr. Hoffman serves as a member of the Financial
Accounting Standards Board's Small Business Advisory Committee and the steering committee of the Association of Bioscience
Financial Officers. Mr. Hoffman formerly served as a director and President, of the San Diego Chapter of Financial Executives
International. Mr. Hoffman holds a B.B.A. from St. Bonaventure University, and is licensed as a C.P.A. (inactive) in the State
of California. Mr. Hoffman's financial and executive business experience qualifies him to serve on our Board of Directors.
Saiid
Zarrabian
has served as our director since July 7, 2017, Chief Executive Officer since November 3, 2017, and President since
January 1, 2018. From 2014 to 2015 he operated a private personal business. Since October 2016, Mr. Zarrabian has served as an
advisor to Redline Capital Partners, S.A., a Luxembourg based investment firm. From 2012 to 2014 he served as Chairman and member
of the Board of La Jolla Pharmaceutical Company during which time the company transitioned from an OTC listed company to a NASDAQ
listed company. From 2012 to 2013 he served as President of the Protein Production Division of Intrexon Corporation, a synthetic
biology company. He has also previously served as CEO and member of the Board of Cyntellect, Inc., a stem cell processing and
visualization Instrumentation company until its sale in 2012, as President and COO of Senomyx, Inc., a company focused on discovery
and commercialization of new flavor ingredients, and as COO of Pharmacopeia, Inc., a former publicly-traded provider of combinatorial
chemistry discovery services and compounds, where he also served as President & COO of its MSI Division. In addition, Mr.
Zarrabian has served on numerous private and public company boards, including at Immune Therapeutics, Inc., Exemplar Pharma, LLC,
Ambit Biosciences Corporation, eMolecules, Inc., and Penwest Pharmaceuticals CO. His other experience includes COO at Molecular
Simulations, COO of Symbolics, Inc., and as R&D Director at Computervision, Inc. Mr. Zarrabian's business executive
knowledge and experience qualify him to serve on our Board of Directors.
Dennis
Brown, PhD,
has been our chief scientific officer since January 25, 2013. He also served as our director from February 11,
2013 to April 11, 2018. Dr. Brown is one of our founders and has served as Chief Scientific Officer and director of Del Mar (BC)
since inception. Dr. Brown has more than thirty years of drug discovery and development experience. He has served as Chairman
of Mountain View Pharmaceutical's Board of Directors since 2000 and is the President of Valent. In 1999 he founded ChemGenex
Therapeutics, which merged with a publicly traded Australian company in 2004 to become ChemGenex Pharmaceuticals (ASX: CXS/NASDAQ:
CXSP), of which he served as President and a Director until 2009. He was previously a co-founder of Matrix Pharmaceutical, Inc.,
where he served as Vice President (VP) of Scientific Affairs from 1985-1995 and as VP, Discovery Research, from 1995-1999. He
also previously served as an Assistant Professor of Radiology at Harvard University Medical School and as a Research Associate
in Radiology at Stanford University Medical School. He received his B.A. in Biology and Chemistry (1971), M.S. in Cell Biology
(1975) and Ph.D. in Radiation and Cancer Biology (1979), all from New York University. Dr. Brown is an inventor of many issued
U.S. patents and applications, many with foreign counterparts.
57
Scott
Praill, CPA, BSc.
has been our chief financial officer since January 29, 2013 and previously served as a consultant to Del
Mar (BC). From 2004 to 2012 Mr. Praill was an independent consultant providing accounting and administrative services to companies
in the resource industry. Mr. Praill served as CFO of Strata Oil & Gas, Inc. from June 2007 to September 2008. From
November 1999 to October 2003 Mr. Praill was Director of Finance at Inflazyme Pharmaceuticals Inc. Mr. Praill completed his articling
at Price Waterhouse (now PricewaterhouseCoopers LLP) and obtained his Chartered Professional Accountant designation in 1996. Mr.
Praill obtained his Certified Public Accountant (Illinois) designation in 2001. Mr. Praill received a Financial Management Diploma
(Honors), from British Columbia Institute of Technology in 1993, and a Bachelor of Science from Simon Fraser University in 1989.
John
K. Bell, FCPA, FCA, ICD.D
has served as our director since February 11, 2013 and serves as the Chair of the Audit Committee.
Mr. Bell is Chairman of Onbelay Capital Inc., a Canadian based private equity company. Prior to that, from 1996 to 2005, Mr. Bell
was CEO and owner of Polymer Technologies Inc., an automotive parts manufacturer. Prior to that, from 1977 to 1995, Mr. Bell was
founder and owner of Shred-Tech Limited a global manufacturer and supplier of industrial shredders and mobile document shredders.
Mr. Bell served as interim CEO and director of ATS Automation Tooling Systems (TSX-ATA) in 2007. Mr. Bell was a director of Strongco
Corporation (TSX-SQP) from 2008 to 2019 and the Royal Canadian Mint (TSX-MNT) from 2009 to 2018. Mr. Bell is a director of Canopy
Growth Corp. (TSX-WEED) and Canopy Rivers Inc. (TSX-RIV) and Mr. Bell also serves as a member of the audit committee of Canopy
Rivers Inc. Mr. Bell is the past National secretary and board member of The Crohns and Colitis Foundation of Canada. Mr. Bell
is also the past Chairman of Waterloo Regional Police, Cambridge Memorial Hospital, Canada's Technology Triangle accelerator
network and The Region of Waterloo prosperity counsel. Mr. Bell is a graduate of Western University Ivey School of Business, a
Fellow of the institute of Chartered Accountants of Ontario, a graduate of the Institute of Directors Program of Canada and the
owner's president program at Harvard and International marketing program at Oxford. Mr. Bell's financial and executive
business experience qualifies him to serve on our Board of Directors.
Lynda
Cranston BScN, MScN, ICD.D
has served as our director since February 5, 2015 and serves as the Chair of our Nominating and
Corporate Governance Committee. Mrs. Cranston comes to the Board with over 20 years of experience at the CEO level in healthcare.
She is presently Chair of the British Columbia Rapid Transit Company. She previously was, from 2014 to 2016, the National Chair
of the Gastrointestinal Association of Canada. In 2013 she retired from the healthcare industry and her last appointment prior
to her retirement was as the first CEO of the British Columbia Provincial Health Services Authority (2002 to 2013). From 1998-2001,
Mrs. Cranston had been the first CEO of the Canadian Blood Services in Ottawa, ON. Before moving to Ottawa, Mrs. Cranston, as
the CEO of B.C. Women's Hospital and Healthcare Centre had merged the organization with the BC Children's Hospital
and the Sunny Hill Health Centre for Children to become the Children's and Women's Healthcare Centre of BC. Following
the merger Mrs. Cranston became the first CEO. In 2013, Mrs. Cranston was identified as a member of Diversity 50 by the Canadian
Board Diversity Council as being one of Canada's most board ready candidates. Mrs. Cranston was awarded the Board Chair
Award of Excellence by the HealthCare Leaders; Association of British Columbia in 2008. In 2007, she was inducted into Canada's
Most Powerful Women Top 100 Hall of Fame after having been identified in '04, '05 & '06 as one of Canada's
Most Powerful Women Top 100. Mrs. Cranston is a recipient of the YWCA Women of Distinction Award, the 125
th
Anniversary
of the Confederation of Canada Commemorative Medal for community contributions, and the Queen's Golden Jubilee Medal for
contribution to Canada and community. Mrs. Cranston is a graduate of the University of Ottawa and the University of Western
Ontario. Mrs. Cranston's healthcare industry and executive knowledge and experience qualify her to serve on our Board of
Directors.
Napoleone
Ferrara, MD,
has served as our director since June 22, 2018. Since January 2013 he has served as a professor of pathology
and since July 2014 as an adjunct professor of ophthalmology and pharmacology at the University of California, San Diego. Previously,
Dr. Ferrara held increasingly senior positions at Genentech, Inc., over a 24-year period, including fellow, staff scientist and
senior scientist. He is a pioneer in the study of angiogenesis biology and identification of its regulators. Dr. Ferrara's
lab is responsible for discovering the isolation and cDNA cloning of VEGF and demonstrated that VEGF was a major mediator of tumor
angiogenesis leading to the development of Avastin
®
(bevacizumab). Additionally, his lab's studies led to
the clinical development of an anti-VEGF antibody fragment, Lucentis
®
(ranibizumab), as a highly effective therapy
preventing vision loss in intraocular neovascular disorders. Dr. Ferrara has been the recipient of over 60 awards/honors, given
more than 300 presentations, authored over 70 patents, and written more than 300 articles, reviews/editorials and published book
chapters. He received his fellowship training and postdoctoral research from the University of California, San Francisco, his
M.D. (cum laude) and residency training from the University of Catania Medical School, and his Maturita' Classica from Liceo
Classico Mario Cutelli. Dr. Ferrara's scientific knowledge and experience qualify him to serve on our Board of Directors.
Robert
J. Toth, Jr., MBA
has served as our director since August 20, 2013 and serves as Chair of our Compensation Committee. Since
2005, Mr. Toth has primarily been managing his personal investment portfolio. From 2004-2005, Mr. Toth served as a consulting
analyst to Narragansett Asset Management, a New York-based healthcare-focused hedge fund, where he advised the firm on biotechnology
investments. From 2001-2003, he was the Senior Portfolio Manager for San Francisco-based EGM Capital's Medical Technology
hedge fund, where he was responsible for managing and maintaining a dedicated medical technology portfolio. Mr. Toth began his
Wall Street career in 1996 as an Equity Research Associate for Vector Securities International, a healthcare-focused brokerage
firm. From 1997-1999 he served as Senior Biotechnology Analyst. He joined Prudential Securities as Senior Vice President and Biotechnology
Analyst where he served from 1999-2001 following Prudential's acquisition of Vector. His responsibilities included the analysis
of commercial, clinical and scientific fundamentals of oncology and genomics-based biotechnology companies on behalf of institutional
investors. Mr. Toth was named to the Wall Street Journal's Allstar List for stock picking in 1999. Mr. Toth received an
MBA from the University of Washington and Bachelor of Science degrees in Biological Sciences and Biochemistry from California
Polytechnic State University, San Luis Obispo. Mr. Toth's financial and biotechnology industry knowledge and experience
quality him to serve on our Board of Directors.
58
The
Board of Directors and Its Committees
Board
of Directors Operations and Meetings
Our
Board currently consists of six members. Our directors hold office until their successors have been elected and qualified or until
the earlier of their resignation or removal.
We
have no formal policy regarding board diversity. Our priority in selection of board members is identification of members who will
further the interests of our stockholders through their established record of professional accomplishment, the ability to contribute
positively to the collaborative culture among board members, knowledge of our business and understanding of the competitive landscape.
Our
Board met 27 times in fiscal 2018. Each of the directors attended at least 75% of the aggregate of (i) the total number of meetings
of our Board (held during the period for which such directors served on the Board), and (ii) the total number of meetings of all
committees of our Board on which the director served (during the periods for which the director served on such committee or committees).
The
Board oversees our business and monitors the performance of our management. In accordance with our corporate governance procedures,
the Board does not involve itself in the day-to-day operations of DelMar. Our executive officers and management oversee our day-to-day
operations. Our directors fulfill their duties and responsibilities by attending meetings of the Board, which are usually held
on at least a quarterly basis. Our directors also discuss business and other matters with other key executives and our principal
external advisers (legal counsel, auditors, financial advisors and other consultants).
Independent
Directors
Our
Board has determined that Robert Hoffman, John Bell, Lynda Cranston, Napoleone Ferrara and Robert Toth are qualified to serve
as independent directors. Prior to being appointed Chief Executive Officer, Saiid Zarrabian was also determined by our Board to
be independent. The standards relied on by the Board in affirmatively determining whether a director is "independent,"
in compliance with Nasdaq's rules, are comprised of those objective standards set forth in the rules promulgated by Nasdaq.
The Board is responsible for ensuring that independent directors do not have a relationship that, in the opinion of the Board,
would interfere with the exercise of independent judgment in carrying out the responsibilities of a director.
Nasdaq's
rules, as well as SEC rules, impose additional independence requirements for all members of the Audit Committee. Specifically,
in addition to the "independence" requirements discussed above, "independent" audit committee members
must: (1) not accept, directly or indirectly, any consulting, advisory, or other compensatory fees from DelMar or any subsidiary
of DelMar other than in the member's capacity as a member of the Board and any Board committee; (2) not be an affiliated
person of DelMar or any subsidiary of DelMar; and (3) not have participated in the preparation of the financial statements of
DelMar or any current subsidiary of DelMar at any time during the past three years. In addition, Nasdaq's rules require
that all audit committee members be able to read and understand fundamental financial statements, including DelMar's balance
sheet, income statement, and cash flow statement. The Board believes that the current members of the Audit Committee meet these
additional standards.
Furthermore,
at least one member of the Audit Committee must be financially sophisticated, in that he or she has past employment experience
in finance or accounting, requisite professional certification in accounting, or any other comparable experience or background
which results in the individual's financial sophistication, including but not limited to being or having been a chief executive
officer, chief financial officer, other senior officer with financial oversight responsibilities. Additionally, the SEC requires
that DelMar disclose whether the Audit Committee has, and will continue to have, at least one member who is a "financial
expert." The Board has determined that John Bell meets the SEC's definition of an audit committee financial expert.
Audit
Committee
The
Board has formed an Audit Committee, which currently consists of John K. Bell, Chair, Robert E. Hoffman, and Robert Toth, all
of whom are independent (as that term is defined under the Nasdaq Marketplace Rules) and financially literate (as such qualification
is interpreted by the Board in its business judgment). We are relying upon the exemption in section 6.1 of Canadian National Instrument
52-110 — Audit Committees from Parts 3 and 5 thereof. In addition, our Board has determined that Mr. Bell qualifies as an
audit committee financial expert within the meaning of SEC regulations and The NASDAQ Marketplace Rules.
The
Audit Committee oversees and monitors our financial reporting process and internal control system, reviews and evaluates the audit
performed by our registered independent public accountants and reports to our Board any substantive issues found during the audit.
The Audit Committee will be directly responsible for the appointment, compensation and oversight of the work of our registered
independent public accountants. The Audit Committee reviews and approves all transactions with affiliated parties. The Board has
adopted a written charter for the Audit Committee.
A
copy of the Audit Committee Charter is posted under the "Investors" tab on our website, which is located at
www.delmarpharma.com
.
59
Compensation
Committee
The
Board has formed a Compensation Committee which consists of Robert Toth, Chair, Napoleone Ferrara, and Robert E. Hoffman, all
of whom are independent (as that term is defined under the Nasdaq Marketplace Rules). The Compensation Committee assists the Board
in fulfilling its oversight responsibilities relating to (i) corporate governance practices and policies and (ii) compensation
matters, including compensation of the directors and senior management of the Company and the administration of compensation plans
of the Company. The Board has adopted a written charter for the Compensation Committee. A copy of the Compensation Committee Charter
is posted under the "Investors" tab on our website, which is located at
www.delmarpharma.com
.
The
Compensation Committee has engaged Marsh & McLennan Agency LLC as its independent compensation consultant. In 2018, Marsh
& McLennan Agency LLC reviewed both executive and director compensation and did not provide us any other services. Marsh &
McLennan Agency LLC reported directly to the Compensation Committee and provided guidance on trends in executive and non-employee
director compensation, the development of specific executive compensation programs, the composition of our compensation peer group
and other matters as directed by the Compensation Committee. In 2017, Marsh & McLennan Agency LLC did not provide any services
to us.
In
2017, the Compensation Committee engaged Hugessen Consulting to provide certain director compensation services, including with
respect to benchmarking, compensation trends and retention practices and Global Advisors to provide advisory services in connection
with the development of our 2017 Omnibus Equity Incentive Plan. In 2017, Hugessen Consulting and Global Advisors did not provide
us any other services.
Nominating
and Corporate Governance Committee
The
Board has formed a Nominating and Corporate Governance Committee, which currently consists of Lynda Cranston, Chair, John Bell,
and Napoleone Ferrara, all of whom are independent (as that term is defined under the Nasdaq Marketplace Rules). The Board has
adopted a written charter for the Nominating and Corporate Governance Committee. A copy of the Nominating and Corporate Governance
Committee Charter is posted under the "Investors" tab on our website, which is located at
www.delmarpharma.com.
Nomination
of Directors
The
Nominating and Corporate Governance Committee of the Board of Directors assesses potential candidates to fill perceived needs
on the Board of Directors for required skills, expertise, independence and other factors. A director candidate recommended by
our stockholders will be considered in the same manner as a nominee recommended by a Board member, management or other sources.
Stockholders wishing to recommend a candidate for nomination should contact our Secretary in writing at the Secretary of DelMar
at Suite 720-999 West Broadway Vancouver, British Columbia, Canada V5Z 1K5. Our Nominating and Corporate Governance Committee
has discretion to decide which individuals to recommend for nomination as directors.
Board
Leadership Structure and Role in Risk Oversight
Robert
E. Hoffman serves as the chairman of our Board of Directors. Saiid Zarrabian serves as our Chief Executive Officer and President.
We have not adopted a formal policy on whether the Chief Executive Officer and Chairman positions should be separated.
Our
Board of Directors is primarily responsible for overseeing our risk management processes. The Board of Directors receives and
reviews periodic reports from management, auditors, legal counsel, and others, as considered appropriate regarding our assessment
of risks. The Board of Directors focuses on the most significant risks facing us and our general risk management strategy, and
also ensures that risks undertaken by us are consistent with the board's appetite for risk. While the Board of Directors
oversees our risk management, management is responsible for the day-to-day risk management processes. We believe this division
of responsibilities is the most effective approach for addressing the risks we face and that our board leadership structure supports
this approach.
Code
of Ethics
We
have adopted a Code of Ethics and Business Conduct that applies to all of our executive officers, financial and accounting officers,
our directors, our financial managers and all of our employees. The Board of Directors is committed to a high standard of corporate
governance practices and, through its oversight role, encourages and promotes a culture of ethical business conduct. A copy of
our Code of Ethics and Business Conduct is posted under the "Investors" tab under Corporate Governance on our website,
which is located at
www.delmarpharma.com
.
Stockholder
Communication with the Board of Directors and Attendance at Annual Meetings
The
Board maintains a process for stockholders to communicate with the Board and its committees. Stockholders of DelMar and other
interested persons may communicate with the Board or the chair of the Audit Committee, Compensation Committee, and the Nominating
and Corporate Governance Committee by writing to the Secretary of DelMar at Suite 720-999 West Broadway Vancouver, British Columbia,
Canada V5Z 1K5. All communications that relate to matters that are within the scope of the responsibilities of the Board will
be presented to the Board no later than the next regularly scheduled meeting. Communications that relate to matters that are within
the responsibility of one of the Board committees will be forwarded to the chair of the appropriate committee. Communications
that relate to ordinary business matters that are not within the scope of the Board's responsibilities will be forwarded
to the appropriate officer. Solicitations, junk mail and obviously frivolous or inappropriate communications will not be forwarded,
but will be made available to any director who wishes to review them.
60
EXECUTIVE
COMPENSATION
The
Board of Directors has formed a Compensation Committee. The Compensation Committee is responsible for reviewing and approving
management compensation, including salaries, bonuses, and equity compensation. We seek to provide competitive compensation arrangements
that attract and retain key talent necessary to achieve our business objectives.
Summary
Compensation Table
The
following table presents information regarding the total compensation awarded to, earned by, or paid to our Chief Executive Officer
and the two most highly-compensated executive officers (other than the Chief Executive Officer) who were serving as executive
officers as of June 30, 2018 and June 30, 2017 for services rendered in all capacities to us for the years ended June 30, 2018
and June 30, 2017, reflecting our one-for-ten reverse stock split occurring on May 8, 2019. These individuals are our Named Executive
Officers for 2018.
SUMMARY
COMPENSATION TABLE
Name and Principal Position
Period
Salary
(US$)
Bonus
Awards
(US$)
Equity
Awards
(US$)
Total
(US$)
Saiid Zarrabian,
President and CEO
Year Ended
June 30, 2018
237,412
(1)
85,631
615,992
939,035
Year Ended
June 30, 2017
—
—
—
—
Jeffrey Bacha,
Former President and CEO
Year Ended
June 30, 2018
537,579
(2)
—
122,338
659,917
Year Ended
June 30, 2017
305,000
56,250
249,257
610,507
Dennis Brown, PhD,
Chief Scientific Officer
Year Ended
June 30, 2018
200,000
(3)
—
—
200,000
Year Ended
June 30, 2017
175,000
40,000
249,257
464,257
Scott Praill,
Chief Financial Officer
Year Ended
June 30, 2018
200,000
(4)
10,000
—
210,000
Year Ended
June 30, 2017
240,000
40,000
99,596
379,596
(1
)
On July 7, 2017 Mr. Zarrabian was elected to
                      the Board of Directors. Upon his appointment Mr. Zarrabian was granted 3,600 stock options that are exercisable
                      at $21.10 until July 7, 2027 for total compensation expense of $40,752. He was also issued 20,000 PSUs for
                      total compensation expense of $98,428. The PSUs were cancelled effective April 30, 2019. For serving as
                      an independent director from July 7, 2017 until November 3, 2017 he was paid $8,750.
(2)
On February 9, 2017, we entered into an employment
                      agreement with Jeffrey Bacha, our former president and chief executive officer. We paid Mr. Bacha an annual
                      base salary of $250,000 and Mr. Bacha will also be eligible to participate in any bonus plan and long-term
                      incentive plan established by us for senior executives. On December 22, 2017, we entered into a settlement
                      agreement with Mr. Bacha pursuant to which, effective January 1, 2018, he would no longer serve as our officer.
                      In addition, Mr. Bacha did not stand for re-election to the Board of Directors at our 2018 annual meeting
                      of stockholders held on April 11, 2018. Pursuant to the terms of the settlement agreement and consistent
                      with the terms of the employment agreement between Mr. Bacha and us dated February 9, 2017, as amended,
                      Mr. Bacha was entitled to (i) accrued and unpaid base salary through January 1, 2018, (ii) payment for his
                      accrued and unused vacation through January 1, 2018, (iii) severance in an amount equal to 13 months of
                      Mr. Bacha's base salary, or $270,833, (iv) payment in an amount equal to 12 months' of coverage
                      under our benefits plans, or $9,600 and (v) reimbursement for any properly incurred business expenses submitted
                      with appropriate documentation in accordance with our expense reimbursement policies through December 31,
                      2017. In addition, all of Mr. Bacha's unvested stock options were deemed vested as of January 1, 2018
                      and will remain exercisable for three years and any unexercised options will expire on December 31, 2020.
                      In addition, effective January 1, 2018, Mr. Bacha will provide consulting services to us through April 30,
                      2018 for a consulting fee of $20,833 per month and subsequent to April 30, 2018 on an hourly basis. The
                      separation agreement and the employment agreement contain customary post-termination restrictive covenants
                      in favor of us including confidentiality, non-competition and non-solicitation covenants. As a result of
                      modifying Mr. Bacha's stock options, a total of $122,338 has been recognized.
(3)
On January 1, 2015 we entered into a consulting
                      agreement with Dr. Dennis Brown, our chief scientific officer. Subsequent to this agreement, it has been
                      amended and is now renewed on an annual basis. Under the most recent renewal, Dr. Brown will continue to
                      serve as our chief scientific officer until December 31, 2018, which period may be extended in accordance
                      with the terms of the agreement. We will pay Dr. Brown an annual consulting fee of $200,000 during calendar
                      year 2018. We may also pay to Dr. Brown a bonus and incentive compensation as determined at the discretion
                      of the Board of Directors. The consulting agreement with Dr. Brown does not specify the amount of time Dr.
                      Brown is required to devote to us, but does require that Dr. Brown provide us with the full benefit of his
                      knowledge, expertise and ingenuity, and prohibits Dr. Brown from engaging in any business, enterprise or
                      activity contrary to or that would detract from our business.
61
(4)
On February 9, 2017, we entered into an employment
                      agreement with Scott Praill, our chief financial officer. Pursuant to the employment agreement, Mr. Praill
                      will continue to serve as our chief financial officer for an indefinite period until termination of the
                      employment agreement in accordance with its terms. We will pay Mr. Praill an annual base salary of $200,000
                      (which may be adjusted on an annual basis in the discretion of the Board of Directors) and Mr. Praill will
                      also be eligible to participate in any bonus plan and long-term incentive plan established by us for senior
                      executives. The employment agreement may be terminated by us with or without cause (as defined therein).
                      In the event we terminate the employment agreement without cause, we will be required to pay Mr. Praill,
                      any accrued and unpaid base salary, plus an amount equal to 12 months of Mr. Praill's base salary
                      plus one additional month's base salary for each completed year of service, up to 18 months'
                      base salary.
On
November 3, 2017 Mr. Zarrabian was appointed interim chief executive officer and on January 1, 2018 he was also appointed interim
president. On November 3, 2017 we entered an agreement with Mr. Zarrabian pursuant to which he will receive an annualized fee
of $280,000 and be eligible to receive a bonus targeted up to 30% of the $280,000 annual fee which may be adjusted by the Board
based on his individual performance and our performance as a whole, with such performance targets to be established by the Board.
Upon execution of the agreement, we paid Mr. Zarrabian an advance of $45,000 of the annual fee. With the $45,000 advance, Mr.
Zarrabian purchased shares of our common stock on the market. For the period from November 3, 2017 to May 20, 2018 we paid Mr.
Zarrabian a total of $243,510 under the consulting agreement which includes the $45,000 advance, $130,134 in consulting fees,
and $68,376 in bonus. Upon his appointment as interim chief executive officer he was granted 12,000 stock options that are exercisable
at $8.70 until November 3, 2027 for total compensation expense of $53,567.
On
May 21, 2018, we entered into an employment agreement with Mr. Zarrabian pursuant to which Mr. Zarrabian was appointed as our
permanent president and chief executive officer. Under the Agreement, Mr. Zarrabian will receive an annual base salary of $470,000
and will be eligible to receive a fiscal year target bonus of up to 50% of base salary (which may be adjusted by the Board to
up to 60% of base salary based on overachievement of bonus targets or other performance criteria). Any bonus earned for a fiscal
year will be payable in cash, but the Board may pay up to 50% of the bonus, as well as any bonus in excess of 50% of base salary,
in the form of stock options granted under our 2017 Omnibus Equity Incentive Plan (or any successor plan). The bonus for our fiscal
year ending June 30, 2019 will be based on the period from the effective date of the agreement (May 21, 2018) through June 30,
2019. The employment agreement may be terminated by us with or without cause (as defined therein). In the event we terminate the
employment agreement without cause, we will be required to pay Mr. Zarrabian continued payment of his base salary for 12 months,
a prorated bonus for the year of termination based on performance through the date of termination, an additional six months of
vesting credit for any outstanding options, and continued health coverage during the severance period. In the event that an involuntary
termination occurs during a period beginning sixty days before a definitive corporate transaction agreement is entered into that
would result in a change in control, or within twelve months following a change in control, the severance period will increase
to eighteen months' severance, Mr. Zarrabian will receive 100% of his target bonus, and his options will be fully vested.
During the period from May 21, 2018 to June 30, 2018 Mr. Zarrabian was paid $53,528 under the employment agreement. We have also
recorded a pro-rated bonus of $17,255. Upon his appointment as full-time president and chief executive officer Mr. Zarrabian was
granted 83,647 stock options that are exercisable at $9.80 until May 21, 2028 for total compensation expense of $423,245.
62
Outstanding
Equity Awards at Fiscal Year-End
The
following table sets forth outstanding equity awards to our named executive officers as of June 30, 2018, reflecting our one-for-ten
reverse stock split occurring on May 8, 2019.
Option awards
Stock awards
Name
Number of
securities
underlying
unexercised
options (#)
Exercisable
Number of
securities
underlying
unexercised
options (#)
unexercisable
Equity
incentive   plan
awards:
number of
securities
underlying
unexercised
unearned
options
(#)
Option
exercise
price
(US$)
Option
expiration
date
Equity
incentive plan
awards:
Number of
unearned
shares, units or
other rights
that have not
vested
(#)
Equity
incentive plan
awards: Market
or payout value
of unearned
shares, units or
other rights
that have not
vested
($)
Saiid Zarrabian
1,200
(1)
2,400
—
21.10
July 7, 2027
20,000
(5)
—
7,000
(2)
5,000
—
8.70
Nov 3, 2027
—
(3)
83,647
—
9.80
May 21, 2028
Jeffrey Bacha
3,750
—
—
20.00
(6)
Dec 31, 2020
—
—
8,750
—
—
42.00
Dec 31, 2020
9,360
—
—
49.50
Dec 31, 2020
Dennis Brown, PhD
3,750
—
—
20.00
(6)
Feb 1, 2022
—
—
8,750
—
—
42.00
Aug 15, 2023
4,160
(4)
5,200
—
49.50
Feb 17, 2027
Scott Praill
1,250
—
—
20.00
(6)
Feb 1, 2022
—
—
8,750
—
—
42.00
Aug 15, 2023
1,662
(4)
2,078
—
49.50
Feb 17, 2027
(1)
Stock options vest as to 1,200 on June 30,
                         2018, and 300 options vest each three months thereafter starting September 30, 2018.
(2)
Stock options vest pro rata monthly
                               until full vesting on November 3, 2018.
(3)
Stock options vest as to 1/6
th
on
                      November 21, 2018 with the remaining shares vesting in equal monthly installments over a period of 30 months
                      commencing on December 21, 2018.
(4)
Stock options vest pro rata monthly until fully
                      vesting on February 17, 2020.
(5)
Each Performance Stock Unit ("PSU")
                      represents the right to receive one share of common stock upon vesting of the unit based on our fully diluted
                      market capitalization. See additional information in Securities Authorized for Issuance Under Equity Compensation
                      Plans located elsewhere in this prospectus.
(6)
Original exercise price was CDN $20.00. Price
                      was amended to USD $20.00 on June 30, 2016. All other terms of the option grants remain unchanged.
63
Director
Compensation
Director
compensation is intended to provide an appropriate level of remuneration considering the responsibilities, time requirements and
accountability of the Directors.
The
following table sets forth director compensation for the fiscal year ended June 30, 2018 (excluding compensation to our executive
officers set forth in the summary compensation table above) paid by us, reflecting our one-for-ten reverse stock split occurring
on May 8, 2019.
Name
Fees
Earned or
Paid in
Cash
($)
(1)
Stock
Awards
($)
(3)
Option
Awards
($)
Non-Equity
Incentive Plan
Compensation
($)
Nonqualified
Deferred
Compensation
Earnings
($)
All Other
Compensation
($)
Total
($)
Robert E. Hoffman
(4)
10,833
120,106
20,142
—
—
—
151,081
John K. Bell
(2)
40,000
98,428
40,752
—
—
—
179,180
Lynda Cranston
(2)
40,000
98,428
40,752
—
—
—
179,180
Napoleone Ferrara, MD
(5)
863
60,947
19,643
—
—
—
81,453
Erich Mohr, MD
(6)(2)
55,000
98,428
40,752
—
—
—
84,833
Robert J, Toth, Jr.
(2)
37,500
98,428
40,752
—
—
—
179,180
(1)
Effective July 1, 2017, directors are paid a
              $35,000 annual retainer, an additional $5,000 annual retainer for chairing a committee, and the chairman of the
              Board will be paid an additional annual retainer of $25,000.
(2)
On July 7, 2017, independent directors were
                      granted 3,600 stock options at an exercise price of $21.10. The options have a ten-year term and vest as
                      to one-third on June 30, 2018 and 300 on a quarterly basis commencing September 30, 2018.
(3)
A total of 140,000 PSUs were issued
                             under the 2017 Plan to our independent directors, such units were cancelled effective as of April
                             30, 2019. Dr. Mohr forfeited 20,000 upon his resignation leaving a net outstanding as of June 30,
                             2018 of 120,000. The awards represent the right to receive an aggregate of 120,000 shares of our
                             common stock upon vesting of the PSUs. Vesting is based on targets approved by our Board of Directors
                             related to our fully diluted market capitalization. The PSUs vest at various fully diluted market
                             capitalizations but will vest in full upon us achieving a fully diluted market capitalization of
                             at least $500 million for five consecutive business days. The PSUs expire on July 7, 2022.
(4)
Mr. Hoffman was appointed to the
                                Board of Directors on April 11, 2018 and was appointed Chairman on June 2, 2018. He has been granted
                                3,600 stock options at an exercise price of $10.60. The options have a ten-year term and vest
                                as to one-third on March 31, 2019 and 300 on a quarterly basis commencing June 30, 2019.
(5)
Dr. Ferrara was appointed to the Board
                             of Directors on June 22, 2018. He has been granted 5,451 stock options at an exercise price of $7.00.
                             The options have a ten-year term and vest as to one-third on May 31, 2019 and 454 on a quarterly
                             basis commencing August 31, 2019.
(6)
Dr. Mohr resigned as Chairman of the
                             Board and as a director on June 2, 2018. Upon his resignation, a total of 1,500 options had their
                             vesting accelerated such that they became fully vested on June 2, 2018 and a total of 4,500 options
                             were modified such that their remaining exercise period was increased from 90 days to one year.
64
Risk
Management
We
do not believe risks arising from its compensation policies and practices for its employees are reasonably likely to have a material
adverse effect on us.
CERTAIN
RELATIONSHIPS AND RELATED PERSON TRANSACTIONS
We
describe below transactions and series of similar transactions that we were or will be a party to in which (i) an executive officer,
director, nominee for election as a director, beneficial owner of more than 5% of any class of our common stock or any member
of the immediate family of any of the foregoing persons and (ii) the amount involved exceeds $120,000 or one percent of the average
of our total assets at year-end for the last two completed fiscal years.
Other
than as described below, there has not been, nor is there any currently proposed, transactions or series of similar transactions
to which we have been or will be a party.
On
September 12, 2010, Del Mar (BC) entered into a Patent Assignment Agreement (the "Assignment") with Valent Technologies
LLC pursuant to which Valent assigned to Del Mar (BC) its rights to patent applications and the prototype drug product related
to VAL-083. In accordance with the Assignment the consideration paid by Del Mar (BC) was $250,000 to acquire the prototype drug
product. In accordance with the terms of the Assignment, Valent is entitled to receive a future royalty (in the single digits)
on certain revenues derived from the development and commercialization of VAL-083. In the event that Del Mar (BC) terminates the
agreement, Del Mar (BC) may be entitled to receive royalties from Valent's subsequent development of VAL-083 depending on
the development milestones Del Mar (BC) has achieved prior to the termination of the Assignment. The Assignment has a term (on
a country-by-country basis), of the later of ten years or until patent rights covered by the Assignment no longer exist, subject
to earlier termination in the event Del Mar (BC) breaches its payment obligations and fails to remedy such breach within 60 days,
or if either party materially beaches any of its obligations and does not cure such breach within 30 days after receipt of notice
thereof.
Pursuant
to a loan agreement dated February 3, 2011, between Del Mar (BC) and Valent, Valent loaned Del Mar $250,000 for the purchase of
the prototype drug product under the Assignment. The loan is unsecured, bears interest at 3% per year, and is payable on demand.
Effective September 30, 2014, we entered into and closed an agreement with Valent to exchange its loan, including accrued interest
to September 30, 2014, with Valent for 278,530 shares of our Series A preferred stock. The Series A preferred stock has an annual
3% dividend.
One
of our officers, Dr. Dennis Brown, is a principal of Valent and as result Valent is a related party to us.
65
PRINCIPAL
STOCKHOLDERS
The
following table sets forth certain information, as of June 15, 2019, with respect to the beneficial ownership of the outstanding
common stock, reflecting our one-for-ten reverse stock split occurring on May 8, 2019, by (i) any holder of more than five (5%)
percent; (ii) each of our executive officers and directors; and (iii) our directors and executive officers as a group. Except
as otherwise indicated, each of the stockholders listed below has sole voting and investment power over the shares beneficially
owned.
Name of Beneficial Owner
(1)
Common Stock
Beneficially
Owned
Percentage of
Common
Stock
(2)
Directors and Officers:
Saiid Zarrabian
50,019
(3)
1.29
%
Dennis Brown, PhD
90,091
(4)
2.34
%
Scott Praill
25,064
(5)
*
Robert E. Hoffman
4,500
(6)
*
John K. Bell
20,571
(7)
*
Robert J. Toth, Jr.
9,899
(8)
*
Lynda Cranston
9,004
(9)
*
Napoleone Ferrara, MD
4,817
(10)
*
Jeffrey Bacha
104,063
(11)
2.7
%
All officers and directors as a group (9 persons)
318,028
8.3
%
*
Less than 1%
(1)
Except
                                         as otherwise indicated, the address of each beneficial owner is c/o DelMar Pharmaceuticals,
                                         Inc., Suite 720 – 999 West Broadway, Vancouver, British Columbia, Canada V5Z 1K5.
(2)
Applicable
                                         percentage ownership is based on 3,827,259 shares of common stock outstanding as of June
                                         15, 2019, together with securities exercisable or convertible into shares of common stock
                                         within 60 days of June 15, 2019 for each stockholder. Beneficial ownership is determined
                                         in accordance with the rules of the SEC and generally includes voting or investment power
                                         with respect to securities. Shares of common stock that are currently exercisable or
                                         exercisable within 60 days of June 15, 2019 are deemed to be beneficially owned by the
                                         person holding such securities for the purpose of computing the percentage of ownership
                                         of such person, but are not treated as outstanding for the purpose of computing the percentage
                                         ownership of any other person.
(3)
Includes
                                         43,929 shares issuable upon the exercise of vested stock options.
(4)
Includes
                                         53,750 shares held by Valent Technologies, LLC, 20,040 shares issuable upon exercise
                                         of vested stock options, 2,125 shares issuable upon exercise of warrants held by Dr.
                                         Brown, and 750 shares issuable upon the conversion of Series B Preferred Stock.
(5)
Includes
                                         15,513 shares issuable upon exercise of vested stock options, 1,250 shares issuable upon
                                         exercise of warrants and 938 shares upon the conversion of Series B Preferred Stock.
(6)
Includes
                                         4,500 shares issuable upon exercise of vested stock options.
(7)
Includes
                                         9,671 shares owned by Onbelay Capital, Inc., 1,250 shares issuable upon exercise of warrants
                                         held by Onbelay Capital, Inc., 8,400 shares issuable upon exercise of vested stock options,
                                         and 1,250 shares issuable upon the conversion of Series B Preferred Stock held by Onbelay
                                         Capital, Inc.
(8)
Includes
                                         8,400 shares issuable upon exercise of vested stock options and 325 shares issuable upon
                                         the conversion of Series B Preferred Stock.
(9)
Includes 8,400 shares issuable upon exercise
                      of vested options and 313 shares issuable upon the conversion of Series B Preferred Stock.
(10)
Includes 4,817 shares issuable upon exercise
                      of vested stock options.
(11)
Includes 625 shares issuable upon exchange
                      of Exchangeable Shares held in trust, 21,860 shares issuable upon exercise of vested stock options, 1,500
                      shares issuable upon exercise of warrants, and 781 shares issuable upon the conversion of Series B Preferred
                      Stock.
66
MARKET
PRICE OF OUR COMMON STOCK AND RELATED STOCKHOLDER MATTERS
Our
common stock is listed on The Nasdaq Capital Market, under the symbol "DMPI". On June 21, 2019, the closing price
for our common stock as reported on The Nasdaq Capital Market was $1.54 per share. As of May 2, 2019, we had 322 record holders
of our common stock.
DIVIDEND
POLICY
We
have never declared or paid any dividends on our common stock and do not anticipate paying any in the foreseeable future. Any
future determination relating to our dividend policy will be made at the discretion of our board of directors and will depend
on a number of factors, including future earnings, capital requirements, financial conditions, future prospects, contractual restrictions
and covenants and other factors that our board of directors may deem relevant.
SELLING
STOCKHOLDERS
This
prospectus covers an aggregate of up to 760,500 shares of our common stock that may be sold or otherwise disposed of by the selling
stockholders identified herein. Such shares are issuable to the selling stockholders upon the exercise of certain outstanding
common stock purchase warrants (the "Investment Warrants") we issued and sold to the selling stockholders in a private
placement transaction, as described above under "Prospectus Summary – Registered Direct Offering and Private Placement."
Under the terms of the Investment Warrant, no selling stockholder may exercise an Investment Warrant to the extent the selling
stockholder or any of its affiliates would beneficially own a number of shares of our common stock which would exceed 4.99%.
The
table below sets forth information concerning the resale of our shares by the selling stockholders. The total number of common
shares sold under this prospectus may be adjusted to reflect adjustments due to stock dividends, stock distributions, splits,
combinations or recapitalizations with regard to the common stock. Unless otherwise stated below in the footnotes, to our knowledge,
no selling stockholder, nor any affiliate of such stockholder: (i) has held any position or office with us during the three years
prior to the date of this prospectus; or (ii) is a broker-dealer, or an affiliate of a broker-dealer.
Set
forth below is the name of each selling stockholder and the amount and percentage of common stock owned by each (including shares
which a stockholder has the right to acquire within 60 days, including upon exercise of options or warrants) prior to the offering,
the shares to be sold in the offering, and the amount and percentage of common stock to be owned by each (including shares which
a stockholder has the right to acquire within 60 days, including upon exercise of options or warrants) after the offering assuming
all shares are sold. The footnotes provide information about persons who have voting and dispositive power with respect to shares
held by the selling stockholders.
The
following table is based on information provided to us by the selling stockholders and is as of June 15, 2019. The selling stockholders
may sell all or some of the shares of common stock they are offering, and may sell, unless indicated otherwise in the footnotes
below, shares of our common stock otherwise than pursuant to this prospectus. The tables below assume that each selling stockholder
sells all of the shares offered by it in offerings pursuant to this prospectus, and does not acquire any additional shares. We
are unable to determine the exact number of shares that will actually be sold or when or if these sales will occur.
Shares of Common
Stock
Beneficially Owned Prior
to Offering
Number
of
Shares of
Common
Stock Being
Shares of Common
Stock to
be Beneficially Owned After
Offering
Name of Selling Securityholder
Number
Percentage
Offered
(1)
Number
Percentage
Anson Investments Master Fund LP
(2)
201,322
4.99
%
190,125
202,822
4.99
%
Empery Asset Master, Ltd
(3)
120,749
3.07
%
111,487
9,262
*
Empery Tax Efficient, LP
(4)
14,575
*
13,458
1,117
*
Empery Tax Efficient II, LP
(5)
70,595
1.81
%
65,180
5,415
*
Hudson Bay Master Fund Ltd.
(6)
190,125
4.73
%
190,125
0
*
Intracoastal Capital, LLC
(7)
200,744
4.99
%
190,125
49,100
1.25
%
*
Less
                                         than 1%
(1)
Applicable
                                         percentage ownership is based on 3,827,259 shares of common stock outstanding as of June
                                         15, 2019, together with securities exercisable or convertible into shares of common stock
                                         within 60 days of June 15, 2019 for each stockholder. Beneficial ownership is determined
                                         in accordance with the rules of the SEC and generally includes voting or investment power
                                         with respect to securities. Shares of common stock that are currently exercisable or
                                         exercisable within 60 days of June 15, 2019 are deemed to be beneficially owned by the
                                         person holding such securities for the purpose of computing the percentage of ownership
                                         of such person, but are not treated as outstanding for the purpose of computing the percentage
                                         ownership of any other person.
67
(2)
Consists
                                         of (i) 162,822 shares of common stock, (ii) 2,500 shares of common stock receivable upon
                                         conversion of convertible preferred shares and (iii) 36,000 shares of common stock underlying
                                         warrants issued in our 2018 registered direct offering (the "2018 Warrants")
                                         in column 2 and 37,500 shares of common stock underlying the 2018 Warrants in column
                                         4. The foregoing excludes (i) 64,000 shares of common stock underlying the 2018 Warrants
                                         in column 2 and 62,500 shares of common stock underlying the 2018 Warrants in column
                                         4, (ii) 190,125 shares of common stock underlying Investment Warrants and (iii) 522,500
                                         shares of common stock underlying warrants receivable upon exercise of rights to obtain
                                         additional common warrants (the "Warrant Rights" and, collectively with the
                                         Investment Warrants and the 2018 Warrants, the "Anson Warrants") because
                                         the Anson Warrants are subject to a 4.99% beneficial ownership blocker. Voting and investment
                                         power over the shares held by Anson Investments Master Fund LP ("Anson")
                                         is exercised by the co-investment advisors to Anson. The co-investment advisors of Anson
                                         consist of Anson Advisors Inc. and Anson Funds Management LP. Mr. Moez Kassam and Mr.
                                         Amin Nathoo are directors of Anson Advisors Inc. Mr. Bruce R. Winson is the managing
                                         member of Anson Management GP LLC, which is the general partner of Anson Funds Management
                                         LP.   Each of Mr. Kassam, Mr. Nathoo, and Mr. Winson disclaim beneficial ownership
                                         of the shares of our common stock held by Anson, except to the extent of their pecuniary
                                         interests therein.   The principal business address of each of Mr. Kassam.
                                         Mr. Nathoo and Anson Advisors Inc. is 155 University Ave, Suite 207, Toronto, Ontario
                                         M5H 3B7, and the principal business address of each of Mr. Winson, Anson Management GP
                                         LLC, and Anson Funds Management LP is 5950 Berkshire Lane, Suite 210, Dallas, Texas 75225.
                                         The principal business address for Anson is 190 Elgin Avenue; George Town, Grand Cayman.
(3)
Consists
                                         of 9,262 shares of common stock and 111,487 shares of common stock underlying Investment
                                         Warrants. The exercise of the Investment Warrants held by Empery Asset Master Ltd ("EAM")
                                         are subject to a 4.99% beneficial ownership blocker. Empery Asset Management LP, the
                                         authorized agent of EAM, has discretionary authority to vote and dispose of the shares
                                         held by EAM and may be deemed to be the beneficial owner of these shares. Martin Hoe
                                         and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP,
                                         may also be deemed to have investment discretion and voting power over the shares held
                                         by EAM. EAM, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of these shares.
                                         The principal business address for EAM is c/o Empery Asset Management, LP, 1 Rockefeller
                                         Plaza, Suite 1205, New York, NY 10020.
(4)
Consists
                                         of 1,117 shares of common stock and 13,458 shares of common stock underlying Investment
                                         Warrants. The exercise of the Investment Warrants held by Empery Tax Efficient, LP ("ETE")
                                         are subject to a 4.99% beneficial ownership blocker. Empery Asset Management LP, the
                                         authorized agent of ETE, has discretionary authority to vote and dispose of the shares
                                         held by ETE and may be deemed to be the beneficial owner of these shares. Martin Hoe
                                         and Ryan Lane, in their capacity as investment managers of Empery Asset Management LP,
                                         may also be deemed to have investment discretion and voting power over the shares held
                                         by ETE. ETE, Mr. Hoe and Mr. Lane each disclaim any beneficial ownership of these shares.
                                         The principal business address for ETE is c/o Empery Asset Management, LP, 1 Rockefeller
                                         Plaza, Suite 1205, New York, NY 10020.
(5)
Consists
                                         of 5,415 shares of common stock and 65,180 shares of common stock underlying Investment
                                         Warrants. The exercise of the Investment Warrants held by Empery Tax Efficient II, LP
                                         ("ETE II") are subject to a 4.99% beneficial ownership blocker. Empery Asset
                                         Management LP, the authorized agent of ETE II, has discretionary authority to vote and
                                         dispose of the shares held by ETE II and may be deemed to be the beneficial owner of
                                         these shares. Martin Hoe and Ryan Lane, in their capacity as investment managers of Empery
                                         Asset Management LP, may also be deemed to have investment discretion and voting power
                                         over the shares held by ETE II. ETE II, Mr. Hoe and Mr. Lane each disclaim any beneficial
                                         ownership of these shares. The principal business address for ETE II is c/o Empery Asset
                                         Management, LP, 1 Rockefeller Plaza, Suite 1205, New York, NY 10020.
(6)
Consists
                                         of 190,125 shares of common stock underlying Investment Warrants. The exercise of the
                                         Investment Warrants held by Hudson Bay Master Fund Ltd. ("Hudson Bay") are
                                         subject to a 4.99% beneficial ownership blocker. Hudson Bay Capital Management LP, the
                                         investment manager of Hudson Bay, has voting and investment power over these securities.
                                         Sander Gerber is the managing member of Hudson Bay Capital GP LLC, which is the general
                                         partner of Hudson Bay Capital Management LP. Each of Hudson Bay Master Fund Ltd. and
                                         Sander Gerber disclaims beneficial ownership over these shares. The principal business
                                         address of Hudson Bay is c/o Hudson Bay Capital Management LP, 777 Third Avenue, 30th
                                         Floor, New York, NY 10017.
(7)
Consists
                                         of 49,100 shares of common stock and 151,644 shares of common stock underlying the Investment
                                         Warrants. The foregoing excludes 38,481 shares of common stock issuable upon exercise
                                         of the Investment Warrants because the Investment Warrants are subject to a 4.99% beneficial
                                         ownership blocker. Mitchell P. Kopin ("Mr. Kopin") and Daniel B. Asher ("Mr.
                                         Asher"), each of whom are managers of Intracoastal Capital, LLC ("Intracoastal"),
                                         have shared voting control and investment discretion over the securities reported herein
                                         that are held by Intracoastal. As a result, each of Mr. Kopin and Mr. Asher may be deemed
                                         to have beneficial ownership (as determined under Section 13(d) of the Securities Exchange
                                         Act of 1934, as amended (the "Exchange Act")) of the securities reported
                                         herein that are held by Intracoastal. The corporate address of Intracoastal is 245 Palm
                                         Trail, Delray Beach, FL 33483.
68
DESCRIPTION
OF SECURITIES
General
We
are authorized to issue up to 12,000,000 shares of capital stock, including 7,000,000 shares of common stock, par value $0.001
per share, and 5,000,000 shares of preferred stock, par value $0.001 per share. As of June 15, 2019, we had 3,827,259 shares of
common stock, 278,530 shares of Series A Preferred Stock (as defined below), 673,613 shares of Series B Preferred Stock (as defined
below), and one share of Special Voting Preferred Stock (as defined below) issued and outstanding and 7,813 shares of common stock
issuable upon exchange of Exchangeable Shares of 0959456 B.C. Ltd., a British Columbia corporation ("Exchangeco")
(which shares are recognized on an as-exchanged for common stock basis for financial statement purposes).
The
additional shares of our authorized stock available for issuance may be issued at times and under circumstances so as to have
a dilutive effect on earnings per share and on the equity ownership of the holders of our common stock. The ability of our board
of directors to issue additional shares of stock could enhance the board's ability to negotiate on behalf of the stockholders
in a takeover situation but could also be used by the board to make a change-in-control more difficult, thereby denying stockholders
the potential to sell their shares at a premium and entrenching current management. The following description is a summary of
the material provisions of our capital stock. You should refer to our articles of incorporation, as amended and bylaws, both of
which are on file with the SEC as exhibits to previous SEC filings, for additional information. The summary below is qualified
by provisions of applicable law.
Common
Stock
Each
outstanding share of common stock entitles the holder to one vote, either in person or by proxy, on all matters submitted to a
vote of stockholders, including the election of directors. There is no cumulative voting in the election of directors. All actions
required or permitted to be taken by stockholders at an annual or special meeting of the stockholders must be effected at a duly
called meeting, with a quorum present of a majority in voting power of the shares entitled to vote thereon. Special meetings of
the stockholders may only be called by our Board of Directors acting pursuant to a resolution approved by the affirmative majority
of the entire Board of Directors. Stockholders may not take action by written consent. A vote by the holders of a majority of
our outstanding shares is required to effectuate certain fundamental corporate changes such as liquidation, merger or an amendment
to our articles of incorporation.
Subject
to preferences which may be applicable to any outstanding shares of preferred stock from time to time, holders of our common stock
have equal ratable rights to such dividends as may be declared from time to time by our Board of Directors out of funds legally
available therefor. In the event of any liquidation, dissolution or winding-up of our affairs, holders of common stock will be
entitled to share ratably in our remaining assets after provision for payment of amounts owed to creditors and preferences applicable
to any outstanding shares of preferred stock. All outstanding shares of common stock are fully paid and nonassessable. Holders
of common stock do not have preemptive rights.
The
rights, preferences and privileges of holders of common stock are subject to the rights of the holders of any outstanding shares
of preferred stock.
Preferred
Stock
Our
Board of Directors is authorized to issue up to 5,000,000 shares of preferred stock, par value $0.001 per share, in one or more
series, 3,721,469 of which shares are undesignated.
Our
Board of Directors previously established a series of preferred stock designated as the Special Voting Preferred Stock ("Special
Voting Preferred Stock"), comprising of one share of Preferred Stock, which remains outstanding as of June 15, 2019. The
Special Voting Preferred Stock is not entitled to receive any dividends declared. In the event of liquidation, the Special Voting
Preferred Stock is not entitled to receive any assets of the Company available for distribution. The Special Voting Preferred
Stock is entitled to cast the number of votes equal to the number of exchangeable shares ("Exchangeable Shares") of
0959456 B.C. Ltd. ("Exchangeco") outstanding (i) that are not owned by the Company or any affiliated companies and
(ii) as to which the holder of the Special Voting Preferred Stock has received voting instructions from the holders of such Exchangeable
Shares in accordance with the Voting and Exchange Trust Agreement entered into by and among the Company, 0959454 B.C. Ltd., or
Callco, Exchangeco and Computershare Trust Company of Canada. The Special Voting Preferred Stock is entitled to vote as a single
class with the common stock.
Our
Board of Directors previously established a series of preferred stock designated as Series A Preferred Stock ("Series A
Preferred Stock"), comprising 278,530 shares of preferred stock, of which all shares remain outstanding as of June 15, 2019.
Subject to superior rights of any other outstanding preferred stock from time to time, each outstanding share of Series A Preferred
Stock is entitled to receive, in preference to the common stock, cumulative dividends, payable quarterly in arrears, at an annual
rate of 3% of $1.00 per share of Series A Preferred Stock (the "Series A Stated Value"). Series A Preferred Stock
does not have any voting rights. In the event of liquidation, each share of Series A Preferred Stock is entitled to receive, in
preference to the common stock, a liquidation payment equal to the Series A Stated Value (as adjusted for stock splits, stock
dividends, combinations or other recapitalizations of the Series A Preferred Stock), plus any accrued and unpaid dividends. If
there are insufficient funds to permit full payment, the assets legally available for distribution will be distributed pro rata
among the holders of the Series A Preferred Stock. The Series A Preferred Stock cannot be transferred without the prior written
consent of the Company.
69
Our
Board of Directors previously established a series of preferred stock designated as Series B Preferred Stock ("Series B
Preferred Stock"), comprising 1,000,000 shares of preferred stock, of which 673,613 shares remain outstanding as of June
15, 2019. Subject to superior rights of any other outstanding preferred stock from time to time, each outstanding share of Series
B Preferred Stock is entitled to receive, in preference to the common stock and pari passu with the Series A Preferred Stock,
annual cumulative dividends equal to 9% of $8.00 per share (the "Series B Stated Value"), accruing quarterly on the
date of issue and payable quarterly in arrears on December 31, March 31, June 30 and September 30 of each year. At the time shares
of Series B Preferred Stock are converted into common stock, accrued and unpaid dividends will be paid in cash or with shares
of common stock. In the event we elect to declare any dividends on the common stock, the Series B is entitled on an as-converted
basis. Series B Preferred Stock is entitled to vote with common stock, on an as-converted basis, as a single class with common
stock. In the event of liquidation, each share of Series B Preferred Stock is entitled to receive, in preference to the common
stock and pari passu with the Series A Preferred Stock, a liquidation payment equal to the Series B Stated Value plus any accrued
and unpaid dividends. If there are insufficient funds to permit full payment, the assets legally available for distribution will
be distributed pro rata among the holders of the Series B Preferred Stock.
Each
share of Series B Preferred Stock may be converted into 0.25 fully paid shares of common stock at the option of a holder as long
as we have sufficient authorized and unissued shares of common stock available. The conversion rate may be adjusted in the event
of a reverse stock split, merger or reorganization. The Series B Preferred Stock will automatically convert into common stock
on the earlier of (i) five years from April 29, 2016, or (ii) upon the approval of the our VAL-083 by the U.S. Food and Drug Administration
or the European Medicines Agency so long as the closing bid price of our stock at the time of such approval is at least $80.00
per share.
Preferred
Stock Included in Units Issuable in the Rights Offering
We
will authorize the Series C Convertible Preferred Stock (the "Series C Preferred Stock") by filing a certificate of
designation with the Secretary of State of Nevada. The certificate of designation may be authorized by our Board without approval
by our stockholders.
Holders
of Series C Preferred Stock will be entitled to receive dividends (on an as-if-converted-to-common-stock basis) in the same form
as dividends actually paid on shares of the common stock when, as and if such dividends are paid on shares of common stock. Except
as otherwise provided in the certificate of designation or as otherwise required by law, the Series C Preferred Stock has no voting
rights. We are not obligated to redeem or repurchase any shares of Series C Preferred Stock. Shares of Series C Preferred Stock
are not otherwise entitled to any redemption rights, or mandatory sinking fund or analogous provisions. In the event of liquidation,
holders of Series
C Preferred Stock will be entitled
to receive out of our assets, whether capital or surplus, the same amount that a holder of common stock would receive if the Series
C Preferred Stock were fully converted (disregarding for such purpose any conversion limitations under the certificate of designation)
to common stock, which amounts shall be paid pari passu with all holders of common stock.
In
the event we effect certain mergers, consolidations, sales of substantially all of our assets, tender or exchange offers, reclassifications
or share exchanges in which our common stock is effectively converted into or exchanged for other securities, cash or property,
we consummate a business combination in which another person acquires 50% of the outstanding shares of our common stock, or any
person or group becomes the beneficial owner of 50% of the aggregate ordinary voting power represented by our issued and outstanding
common stock, then, upon any subsequent conversion of the Series C Preferred Stock, the holders of the Series C Preferred Stock
will have the right to receive any shares of the acquiring corporation or other consideration it would have been entitled to receive
if it had been a holder of the number of shares of common stock then issuable upon conversion in full of the Series C Preferred
Stock.
Each
share of Series C Preferred Stock will be convertible at our option at any time on or after the first anniversary of the expiration
of the Rights Offering or at the option of the holder at any time, into the number of shares of our common stock determined by
dividing the $1,000 stated value per share of the Series C Preferred Stock by a conversion price of $3.10 per share. In addition,
the conversion price per share is subject to adjustment for stock dividends, distributions, subdivisions, combinations or reclassifications.
Subject to limited exceptions, a holder of the Series C Preferred Stock will not have the right to convert any portion of the
Series C Preferred Stock to the extent that, after giving effect to the conversion, the holder, together with its affiliates,
would beneficially own in excess of 4.99% of the number of shares of our common stock outstanding immediately after giving effect
to its conversion. A holder of the Series C Preferred Stock, upon notice to the Company, may increase or decrease the beneficial
ownership limitation provisions of such holder's Series C Preferred Stock, provided that in no event shall the limitation
exceed 9.99% of the number of shares of our common stock outstanding immediately after giving effect to its conversion.
Anti-takeover
Effects of Nevada Law and our Articles of Incorporation, as amended and Bylaws
Our
articles of incorporation and bylaws contain a number of provisions that could make our acquisition by means of a tender or exchange
offer, a proxy contest or otherwise more difficult. Certain of these provisions are summarized below.
Special
Meetings
Special
meetings of the stockholders may only be called by our Board of Directors or such person or person authorized by the Board of
Directors.
70
Business
Combinations Act
The
Business Combinations Act, Sections 78.411 to 78.444 of the NRS, restricts the ability of a Nevada "resident domestic corporation"
having at least 200 stockholders of record to engage in any "combination" with an "interested stockholder"
for two (2) years after the date that the person first became an interested stockholder, unless the combination meets all of the
requirements of the articles of incorporation of the resident domestic corporation and (i) the purchase of shares by the interested
stockholder is approved by the board of directors before that date or (ii) the combination is approved by the board of directors
of the resident domestic corporation and, at or after that time, the combination is approved at an annual or special meeting of
the stockholders of the resident domestic corporation, and not by written consent, by the affirmative vote of the holders of stock
representing at least sixty percent (60%) of the outstanding voting power of the resident domestic corporation not beneficially
owned by the interested stockholder or the affiliates or associates of the interested stockholder.
If
this approval is not obtained, then after the expiration of the two (2) year period, the business combination may still not be
consummated unless it is a combination meeting all of the requirements of the articles of incorporation of the resident domestic
corporation and either the "fair price" requirements specified in NRS 78.441 to 78.444, inclusive are satisfied or
the combination is (a) a combination or transaction by which the person first became an interested stockholder is approved by
the board of directors of the resident domestic corporation before the person first became an interested stockholder, or (b) a
combination approved by a majority of the outstanding voting power of the resident domestic corporation not beneficially owned
by the interested stockholder, or any affiliate or associate of the interested stockholder.
"Interested
stockholder" means any person, other than the resident domestic corporation or its subsidiaries, who is (a) the beneficial
owner, directly or indirectly, of 10% or more of the voting power of the outstanding voting shares of the resident domestic corporation
or (b) an affiliate or associate of the resident domestic corporation and at any time within two years immediately before the
date in question was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then outstanding
shares of the resident domestic corporation.
A
"combination" is broadly defined and includes, for example, any merger or consolidation of a corporation or any of
its subsidiaries with (i) an interested stockholder or (ii) any other entity that after and as a result of the merger or consolidation
would be an affiliate or associate of the interested stockholder; or any sale, lease, exchange, pledge, transfer or other disposition
of assets of the corporation, in one transaction or a series of transactions, to or with an interested stockholder having: (x)
an aggregate market value equal to more than 5% of the aggregate market value of the assets of a corporation, (y) an aggregate
market value equal to more than 5% of the aggregate market value of all outstanding voting shares of a corporation, or (z) representing
more than 10% of the earning power or net income of a corporation.
The
provisions of Nevada law, our articles of incorporation and our bylaws could have the effect of discouraging others from attempting
hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock
that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes
in our management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders
may otherwise deem to be in their best interests.
Control
Shares
Nevada
law also seeks to impede "unfriendly" corporate takeovers by providing in Sections 78.378 to 78.3793 of the NRS that
an "acquiring person" shall only obtain voting rights in the "control shares" purchased by such person
to the extent approved by the other shareholders at a meeting. With certain exceptions, an acquiring person is one who acquires
or offers to acquire a "controlling interest" in the corporation, defined as one-fifth or more of the voting power.
Control shares include not only shares acquired or offered to be acquired in connection with the acquisition of a controlling
interest, but also all shares acquired by the acquiring person within the preceding 90 days. The statute covers not only the acquiring
person but also any persons acting in association with the acquiring person.
A
Nevada corporation may elect to opt out of the provisions of Sections 78.378 to 78.3793 of the NRS. We have no provision in our
articles of incorporation pursuant to which we have elected to opt out of Sections 78.378 to 78.3793; therefore, these sections
do apply to us.
Warrants
As
of June 15, 2019, we had outstanding warrants issued between January 25 – March 6, 2013, between July 16 – 31,
2015, between August 1, 2015 to February 1, 2016, May 12, 2016, February 27, 2017, April 19, 2017, September 22, 2017, January
25, 2018, February 27, 2018, September 15, 2018, October 11, 2018, November 25, 2018 and June 5, 2019 to purchase up to 1,669,803
shares of common stock, exercisable at prices ranging from $3.10 per share to $59.30 per share.
Stock
Options
As
of June 15, 2019, we had issued and outstanding options to purchase up to 292,683 shares of common stock, exercisable at prices
ranging from $6.10 per share to $92.00 per share.
Performance
Stock Units
As
of March 31, 2019, we had issued and outstanding performance stock units to acquire up to 120,000 shares of common stock, which
units were cancelled effective as of April 30, 2019.
71
Potential
Effects of Authorized but Unissued Stock
We
have shares of common stock and preferred stock available for future issuance without stockholder approval. We may utilize these
additional shares for a variety of corporate purposes, including future public offerings to raise additional capital, to facilitate
corporate acquisitions or payment as a dividend on the capital stock.
The
existence of unissued and unreserved common stock and preferred stock may enable our board of directors to issue shares to persons
friendly to current management or to issue preferred stock with terms that could render more difficult or discourage a third-party
attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise, thereby protecting the continuity
of our management. In addition, the board of directors has the discretion to determine designations, rights, preferences, privileges
and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences
of each series of preferred stock, all to the fullest extent permissible under the Nevada Revised Statute and subject to any limitations
set forth in our articles of incorporation. The purpose of authorizing the board of directors to issue preferred stock and to
determine the rights and preferences applicable to such preferred stock is to eliminate delays associated with a stockholder vote
on specific issuances. The issuance of preferred stock, while providing desirable flexibility in connection with possible financings,
acquisitions and other corporate purposes, could have the effect of making it more difficult for a third-party to acquire, or
could discourage a third-party from acquiring, a majority of our outstanding voting stock.
Transfer
Agent and Warrant Agent
The
transfer agent and registrar for our common stock, preferred stock and the warrant agent for the warrants is Mountain Share Transfer,
Inc.
PLAN
OF DISTRIBUTION
The
selling stockholders, which for this purpose includes donees, pledgees, transferees or other successors-in-interest selling shares
of common stock or interests in shares of common stock received after the date of this prospectus from a selling stockholder as
a gift, pledge, dividend, distribution or other transfer, may, from time to time, sell, transfer or otherwise dispose of any or
all of their shares of common stock or interests in shares of common stock on any stock exchange, market or trading facility on
which the shares are traded, or in private transactions. These sales or other dispositions may be at fixed prices, at prevailing
market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time
of sale, or at negotiated prices.
The
selling stockholders may use any one or more of the following methods when selling our shares or interests in our shares:
●
ordinary brokerage
                             transactions and transactions in which the broker-dealer solicits purchasers;
●
block trades
                                    in which the broker-dealer will attempt to sell the shares as agent but may position and resell
                                    a portion of the block as principal to facilitate the transaction;
●
purchases by
                                    a broker-dealer as principal and resale by the broker-dealer for its account;
●
on any national securities
                             exchange or quotation service on which the shares may be listed or quoted at the time of sale;
●
privately
                                         negotiated transactions;
●
short sales effected
                             after the date of the registration of which this prospectus is a part is declared effective by the
                             SEC;
●
through the
                                    writing or settlement of options or other hedging transactions, whether through an option
                                    exchange or otherwise;
●
broker-dealers
                                    may agree with the selling stockholders to sell a specified number of such shares at a stipulated
                                    price per share;
●
a combination of any
                             such methods of sale; and
●
any
                                         other method pursuant to applicable law
The
selling stockholders may, from time to time, pledge or grant a security interest in some or all of our shares owned by them and,
if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares
of common stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other
applicable provision of the Securities Act, amending the list of selling stockholders to include the pledgee, transferee or other
successors in interest as selling stockholders under this prospectus. The selling stockholders may also transfer our shares in
other circumstances, in which case the transferees, pledgees or other successors will be the selling beneficial owners for purposes
of this prospectus.
In
connection with the sale of our common shares or interests therein, the selling stockholders may enter into hedging transactions
with broker-dealers or other financial institutions, which may in turn engage in short sales of our shares in the course of hedging
the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities
to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities.
The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions
or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution
of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this
prospectus (as supplemented or amended to reflect such transaction).
72
The
aggregate proceeds to the selling stockholders from the sale of the common stock offered by them will be the purchase price of
the common stock less discounts or commissions, if any. Each of the selling stockholders reserves the right to accept and, together
with their agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly
or through agents. We will not receive any of the proceeds from sales of shares by the selling stockholders.
The
selling stockholders may also resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under
the Securities Act, provided that they meet the criteria and conform to the requirements of that rule, or under Section 4(a)(1)
of the Securities Act, if available, rather than by means of this prospectus.
In
connection with the sale of shares of common stock covered by this prospectus, broker-dealers may receive commissions or other
compensation from a selling stockholder in the form of commissions, discounts or concessions. Broker-dealers may also receive
compensation from purchasers of the shares of common stock for whom they act as agents or to whom they sell as principals or both.
Compensation as to a particular broker-dealer may be in excess of customary commissions or in amounts to be negotiated. In connection
with any underwritten offering, underwriters may receive compensation in the form of discounts, concessions or commissions from
a selling stockholder or from purchasers of the shares for whom they act as agents. Underwriters may sell the shares of common
stock to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as agents. Any underwriters, broker-dealers, agents
or other persons acting on behalf of a selling stockholder that participate in the distribution of the shares of common stock
may be deemed to be "underwriters" within the meaning of the Securities Act, and any profit on the sale of the shares
of common stock by them and any discounts, commissions or concessions received by any of those underwriters, broker-dealers, agents
or other persons may be deemed to be underwriting discounts and commissions under the Securities Act. The aggregate amount of
compensation in the form of underwriting discounts, concessions, commissions or fees and any profit on the resale of shares by
the selling stockholders that may be deemed to be underwriting compensation pursuant to Financial Industry Regulatory Authority,
Inc., rules and regulations will not exceed applicable limits.
The
selling stockholders and any underwriters, broker-dealers or agents that participate in the sale of the common stock or interests
therein may be "underwriters" within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions,
concessions or profit they earn on any resale of the shares may be underwriting discounts and commissions under the Securities
Act. Selling stockholders who are "underwriters" within the meaning of Section 2(a)(11) of the Securities Act will
be subject to the prospectus delivery requirements of the Securities Act and may be subject to certain statutory liabilities,
including but not limited to, Sections 11, 12 and 17 of the Securities Act and Rule 10b-5 under the Exchange Act.
To
the extent required, the shares of our common stock to be sold, the names of the selling stockholders, the respective purchase
prices and public offering prices, the names of any agent, dealer or underwriter, and any applicable commissions or discounts
with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective
amendment to the registration statement that includes this prospectus.
In
order to comply with the securities laws of some states, if applicable, the common stock may be sold in these jurisdictions only
through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has
been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied
with.
We
have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales
of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, to the extent applicable,
we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling stockholders
for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling stockholders may indemnify
any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities
arising under the Securities Act. All of the foregoing may affect the marketability of the common stock and the ability of any
person or entity to engage in market-making activities with respect to our common stock.
We
will pay all expenses of the registration of the common stock for resale by the selling stockholders, including, without limitation,
filing fees and expenses of compliance with state securities or "blue sky" laws; provided, however, that each selling
stockholder will pay all underwriting discounts and selling commissions, if any, and any related legal expenses incurred by it.
73
LEGAL
MATTERS
The
validity of the securities offered hereby will be passed upon for us by Fennemore Craig, P.C, Reno, Nevada. Certain other matters
are being passed upon for us by Lowenstein Sandler LLP.
EXPERTS
The
consolidated financial statements of DelMar Pharmaceuticals, Inc. at June 30, 2018 and 2017, and for the years then ended, appearing
in this Prospectus and Registration Statement have been audited by Ernst & Young LLP, independent registered public accounting
firm, as set forth in their report thereon (which contains an explanatory paragraph describing conditions that raise substantial
doubt about the Company's ability to continue as a going concern as described in Note 1 to the consolidated financial statements)
appearing elsewhere herein, and are included in reliance upon such report given on the authority of such firm as experts in accounting
and auditing.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed a registration statement on Form S-1 with the SEC under the Securities Act of 1933, as amended. This prospectus is
part of the registration statement, but the registration statement includes additional information and exhibits. We file annual,
quarterly and current reports, proxy statements and other information with the SEC. The SEC maintains a web site that contains
reports, proxy and information statements and other information regarding companies, such as ours, that file documents electronically
with the SEC. The website address is
www.sec.gov.
The information on the SEC's website is not part of this prospectus,
and any references to this website or any other website are inactive textual references only. Additionally, you may access our
filings with the SEC through our website at
http://www.delmarpharma.com
. The information on our website is not part of
this prospectus.
74
DelMar
Pharmaceuticals, Inc.
INDEX
TO FINANCIAL STATEMENTS
Contents
Page
Unaudited
    Consolidated Condensed Interim Financial Statements – March 31, 2019:
Consolidated Condensed Interim Balance Sheets as of March 31, 2019 and June 30, 2018
F-2
Consolidated Condensed Interim Statements of Loss and Comprehensive Loss for the three and nine months ended March 31, 2019 and 2018
F-3
Consolidated Condensed Interim Statements of Cash Flows for the nine months ended March 31, 2019 and 2018
F-4
Notes to Consolidated Condensed Interim Financial Statements
F-5 – F-19
Consolidated
    Financial Statements – June 30, 2018 and 2017:
Report of Independent-Public Registered Accounting Firm
F-20
Consolidated Balance Sheets as of June 30, 2018 and 2017
F-21
Consolidated Statements of Operations and Comprehensive Loss for the years ended June 30, 2018 and 2017
F-22
Consolidated Statements of Changes in Stockholders' Equity for the years ended June 30, 2018 and 2017
F-23
Consolidated Statements of Cash Flows for the years ended June 30, 2018 and 2017
F-24
Notes to the Consolidated Financial Statements
F-25 – F-47
F-
1
DelMar
                                         Pharmaceuticals, Inc.
Consolidated
        Condensed Interim Balance Sheets (Unaudited)
(expressed
in US dollars unless otherwise noted)
Note
March 31,
2019
$
June 30,
2018
$
Assets
Current assets
Cash and cash equivalents
2,152,233
5,971,995
Prepaid expenses and deposits
240,071
1,034,930
Interest, taxes and other receivables
9,086
39,519
Deferred financing costs
7,8
40,873
—
2,442,263
7,046,444
Intangible assets – net
14,863
28,411
2,457,126
7,074,855
Liabilities
Current liabilities
Accounts payable and accrued liabilities
1,084,460
1,478,086
Related party payables
113,240
160,429
1,197,700
1,638,515
Derivative liability
4
265
1,117
1,197,965
1,639,632
Stockholders' equity
Preferred stock
Authorized
5,000,000 shares, $0.001 par value
Issued and outstanding
278,530 Series A shares at March 31, 2019 (June 30, 2018 – 278,530)
3,5
278,530
278,530
841,113 Series B shares at March 31, 2019 (June 30, 2018 – 881,113)
5
5,867,829
6,146,880
1 special voting share at March 31, 2019 (June 30, 2018 – 1)
—
—
Common stock
Authorized
7,000,000 shares (June 30, 2018 – 7,000,000), $0.001 par value
2,620,033 issued at March 31, 2019 (June 30, 2018 –
2,296,667)
5
2,620
2,297
Additional paid-in capital
5
47,022,252
43,198,193
Warrants
5
6,055,319
8,229,482
Accumulated deficit
(57,988,567
)
(52,441,337
)
Accumulated other comprehensive income
21,178
21,178
1,259,161
5,435,223
2,457,126
7,074,855
Going
concern, nature of operations, and corporate history
(note 1)
Subsequent
events
(note 8)
The
accompanying notes are an integral part of these consolidated condensed interim financial statements.
F-
2
DelMar Pharmaceuticals, Inc.
Consolidated Condensed Interim Statements of Loss and Comprehensive Loss (Unaudited)
(expressed
in US dollars unless otherwise noted)
Note
Three months ended
March 31,
2019
$
Three months ended
March 31,
2018
$
Nine months ended
March 31,
2019
$
Nine months
ended
March 31,
2018
$
Expenses
Research and development
5
735,844
1,779,609
2,702,213
5,856,197
General and administrative
5
935,530
1,155,038
2,796,884
2,911,538
1,671,374
2,934,647
5,499,097
8,767,735
Other loss (income)
Change in fair value of derivative liability
4
189
(2,160
)
(852
)
(57,839
)
Foreign exchange loss
5,819
6,420
16,754
57,406
Interest income
(13,397
)
(5,850
)
(49,513
)
(6,241
)
(7,389
)
(1,590
)
(33,611
)
(6,674
)
Net and comprehensive loss for the period
1,663,985
2,933,057
5,465,486
8,761,061
Computation of basic loss per share
Net and comprehensive loss for the period
1,663,985
2,933,057
5,465,486
8,761,061
Series B Preferred stock dividend
23,202
46,626
75,477
142,358
Net and comprehensive loss available to common stockholders
1,687,187
2,979,683
5,540,963
8,903,419
Basic and fully diluted loss per share
0.67
1.31
2.27
4.41
Basic weighted average number of shares
2,518,452
2,283,245
2,444,065
2,017,977
The
accompanying notes are an integral part of these consolidated condensed interim financial statements.
F-
3
DelMar
                                         Pharmaceuticals, Inc.
Consolidated
        Condensed Interim Statements of Cash Flows (Unaudited)
(expressed
in US dollars unless otherwise noted)
Nine months ended
March 31,
Note
2019
$
2018
$
Cash flows from operating activities
Loss for the period
(5,465,486
)
(8,761,061
)
Items not affecting cash
Amortization of intangible assets
13,548
17,869
Change in fair value of derivative liability
4
(852
)
(57,839
)
Shares issued for services
5
10,269
4,821
Warrants issued for services
5
36,534
155,204
Stock option expense
5
355,388
430,673
Performance stock unit expense
5
183,205
—
Changes in non-cash working capital
Interest, taxes and other receivables
30,433
14,578
Prepaid expenses and deposits
794,859
135,293
Accounts payable and accrued liabilities
(425,383
)
708,634
Related party payables
(47,189
)
33,816
(4,514,674
)
(7,318,012
)
Cash flows from investing activities
Intangible assets – website development costs
—
(12,649
)
—
(12,649
)
Cash flows from financing activities
Net proceeds from the issuance of shares and warrants
5
—
8,945,336
Net proceeds from the exercise and exchange of warrants
5,7
726,179
312,500
Series A preferred cash dividend
5
(6,267
)
(6,267
)
Deferred financing costs
7,8
(25,000
)
—
694,912
9,251,569
(Decrease) increase in cash and cash equivalents
(3,819,762
)
1,920,908
Cash and cash equivalents – beginning of period
5,971,995
6,586,014
Cash and cash equivalents – end of period
2,152,233
8,506,922
Supplementary
information
(note 7)
The
accompanying notes are an integral part of these consolidated condensed interim financial statements.
F-
4
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
1
Going
concern, nature of operations, and corporate history
Going
concern
These
consolidated condensed interim financial statements have been prepared on a going concern basis which assumes that DelMar Pharmaceuticals,
Inc. (the "Company") will continue its operations for the foreseeable future and contemplates the realization of assets
and the settlement of liabilities in the normal course of business.
For
the nine months ended March 31, 2019, the Company reported a loss of $5,465,486, and a negative cash flow from operations of $4,514,674.
The Company had an accumulated deficit of $57,988,567 as of March 31, 2019. As of March 31, 2019, the Company had cash and cash
equivalents on hand of $2,152,233. The Company is in the development stage and has not generated any revenues to date. The Company
does not have the prospect of achieving revenues until such time that its product candidate is commercialized, or partnered, which
may not ever occur. In the near future, the Company will require additional funding to maintain its clinical trials, research
and development projects, and for general operations. These circumstances indicate substantial doubt exists about the Company's
ability to continue as a going concern.
Consequently,
management is pursuing various financing alternatives to fund the Company's operations so it can continue as a going concern.
Management plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership
arrangements. The Company may tailor its drug candidate development program based on the amount of funding the Company is able
to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful.
These
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.
Nature
of operations
The
Company is a clinical stage drug development company with a focus on the treatment of cancer that is conducting clinical trials
in the United States and China with our product candidate, VAL-083, as a potential new treatment for glioblastoma multiforme,
the most common and aggressive form of brain cancer. The Company has also acquired certain commercial rights to VAL-083 in China
where it is approved as a chemotherapy for the treatment of chronic myelogenous leukemia and lung cancer. In order to accelerate
the Company's development timelines, the Company leverages existing clinical and commercial data from a wide range of sources.
The Company may seek marketing partnerships in order to potentially generate future royalty revenue.
The
address of the Company's administrative offices is Suite 720 - 999 West Broadway, Vancouver, British Columbia, Canada, V5Z
1K5 with clinical operations located at 3485 Edison Way, Suite R, Menlo Park, California, 94025.
Corporate
history
The
Company is a Nevada corporation formed on June 24, 2009 under the name Berry Only, Inc. On January 25, 2013, the Company entered
into and closed an exchange agreement (the "Exchange Agreement"), with Del Mar Pharmaceuticals (BC) Ltd. ("Del
Mar (BC)"), 0959454 B.C. Ltd. ("Callco"), and 0959456 B.C. Ltd. ("Exchangeco") and the security
holders of Del Mar (BC). Upon completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of the Company
(the "Reverse Acquisition").
F-
5
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
1
Going
concern, nature of operations, and corporate history
(cont.)
DelMar
Pharmaceuticals, Inc. is the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6, 2010,
which is a clinical stage company with a focus on the development of drugs for the treatment of cancer. The Company is also the
parent company to Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were formed to
facilitate the Reverse Acquisition.
References
to the Company refer to the Company and its wholly-owned subsidiaries, Del Mar (BC), Callco and Exchangeco.
2
Significant
accounting policies
Basis
of presentation
The
consolidated condensed interim financial statements of the Company have been prepared in accordance with United States Generally
Accepted Accounting Principles ("U.S. GAAP") and are presented in United States dollars. The functional currency of
the Company and each of its subsidiaries is the United States dollar.
The
accompanying consolidated condensed interim financial statements include the accounts of the Company and its wholly-owned subsidiaries,
Del Mar (BC), Callco, and Exchangeco. All intercompany balances and transactions have been eliminated in consolidation.
The
principal accounting policies applied in the preparation of these consolidated condensed interim financial statements are set
out below and have been consistently applied to all periods presented.
Unaudited
interim financial data
The
accompanying unaudited consolidated condensed interim financial statements have been prepared in accordance with the rules and
regulations of the Securities and Exchange Commission for interim financial information. Accordingly, they do not include all
of the information and the notes required by U.S. GAAP for complete financial statements. These unaudited consolidated condensed
interim financial statements should be read in conjunction with the audited financial statements of the Company as at June 30,
2018 included in our Form 10-K. In the opinion of management, the unaudited consolidated condensed interim financial statements
reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair presentation. The results for three
and nine months ended March 31, 2019 are not necessarily indicative of the results to be expected for the fiscal year ending June
30, 2019 or for any other future annual or interim period.
Use
of estimates
The
preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions about future
events that affect the reported amounts of assets, liabilities, expenses, contingent assets and contingent liabilities as at the
end of, or during, the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring
management to make estimates include the derivative liability, the valuation of equity instruments issued for services, and clinical
trial accruals. Further details of the nature of these assumptions and conditions may be found in the relevant notes to these
consolidated condensed interim financial statements.
Loss
per share
Income
or loss per share is calculated based on the weighted average number of common shares outstanding. For the three- and nine-month
periods ended March 31, 2019 and 2018, diluted loss per share does not differ from basic loss per share since the effect of the
Company's warrants, stock options, performance stock units, and
convertible preferred shares is anti-dilutive. As of March 31, 2019, potential shares of common stock of 862,502 (2018 –
1,428,128) related to outstanding warrants, 292,683 (2018 – 172,085) relating to stock options, 120,000 (2018 – 0)
relating to performance stock units, and 210,279 (2018 – 220,279) relating to outstanding Series B convertible preferred
shares were excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive.
F-
6
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
Recent
accounting pronouncements
From
time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other
standard setting bodies that are adopted by the Company as of the specified effective date.
Recently
adopted
Accounting
Standards Board ("ASU") 2017-09 — Compensation — Stock Compensation (Topic 718): Scope of
Modification
Accounting
The
amendments in this update provide guidance about which changes to the terms, or conditions of a stock-based payment award, require
an entity to apply modification accounting in Topic 718. The amendments in ASU 2017-09 are effective for all entities for annual
periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including
adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not
yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available
for issuance. The adoption of ASU 2017-09 did not have a material impact on our results of operations or financial position.
ASU
2016-01 — Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial
Liabilities
The
updated guidance enhances the reporting model for financial instruments and requires entities to use the exit price notion when
measuring the fair value of financial instruments for disclosure purposes, and the separate presentation of financial assets and
financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance
sheet or the accompanying notes to the financial statements. The guidance is effective for annual reporting periods beginning
after December 15, 2017. The adoption of ASU 2016-01 did not have a material impact on our results of operations or financial
position.
Not
yet adopted
ASU
2017-11 — I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral
for Mandatorily Redeemable Financial Instruments of Certain Non-public Entities and Certain Mandatorily Redeemable Noncontrolling
Interests with a Scope Exception
The
amendments in this update are intended to reduce the complexity associated with the accounting for certain financial instruments
with characteristics of liabilities and equity. Specifically, a down round feature would no longer cause a freestanding equity-linked
financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes
in fair value recognized in current earnings. In addition, the indefinite deferral of certain provisions of Topic 480 have been
re-characterized to a scope exception. The re-characterization has no accounting effect. ASU 2017-11 is effective for public business
entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is
permitted. The Company is currently evaluating the potential impact of the adoption of this standard.
F-
7
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
ASU
2016-02 — Leases (Topic 842)
The
new standard establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability
on the consolidated balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance
or operating, with classification affecting the pattern of expense recognition in the consolidated income statement. ASU 2016-02
is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods, with
early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases
existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with
certain practical expedients available. The Company is currently evaluating the potential impact of the adoption of this standard.
ASU
2018-07 — Stock Compensation (Topic 718) Improvements to Nonemployee Shares-based Payment Accounting
The
amendments in this update are intended to the reduce cost and complexity and to improve financial reporting for share-based payments
issued to nonemployees. The ASU expands the scope of Topic 718, Compensation —Stock Compensation, which currently only includes
share-based payments issued to employees, to also include share-based payments issued to nonemployees for goods and services.
The existing guidance on nonemployee share-based payments is significantly different from current guidance for employee share-based
payments. This ASU expands the scope of the employee share-based payments guidance to include share-based payments issued to nonemployees.
By doing so, the FASB improves the accounting of nonemployee share-based payments issued to acquire goods and services used in
its own operations. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15,
2018, including interim periods within that fiscal year. The Company is currently evaluating the potential impact of the adoption
of this standard.
3
Valent
Technologies, LLC
On
September 30, 2014, the Company entered into an exchange agreement (the "Valent Exchange Agreement") with Valent Technologies,
LLC ("Valent"), an entity owned by Dr. Dennis Brown, the Company's Chief Scientific Officer, and Del Mar (BC).
Pursuant to the Valent Exchange Agreement, Valent exchanged its loan payable in the outstanding amount of $278,530 (including
aggregate accrued interest to September 30, 2014 of $28,530), issued to Valent by Del Mar (BC), for 278,530 shares of the Company's
Series A Preferred Stock. The Series A Preferred Stock has a stated value of $1.00 per share (the "Series A Stated Value")
and is not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3%
of the Series A Stated Value per year, payable quarterly in arrears.
For
the three months ended March 31, 2019 and 2018 respectively, the Company recorded $2,089 related to the dividend payable to Valent.
For the nine months ended March 31, 2019 and 2018 respectively, the Company recorded $6,267 related to the dividend payable to
Valent. The dividends have been recorded as a direct increase in accumulated deficit.
4
Derivative
liability
The
Company has issued common stock purchase warrants. Based on the terms of certain of these warrants the Company determined that
the warrants were a derivative liability which is recognized at fair value at the date of the transaction and re-measured at fair
value each reporting period with the changes in fair value recorded in the consolidated condensed interim statement of loss and
comprehensive loss.
F-
8
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
4
Derivative
liability
(cont.)
The
Company's derivative liability is summarized as follows:
Three months ended
March 31,
2019
$
2018
$
Opening balance
76
5,549
Change in fair value of warrants
189
(2,160
)
Closing balance
265
3,389
Less current portion
—
(5
)
Long term portion
265
3,384
Nine months ended
March 31,
2019
$
2018
$
Opening balance
1,117
61,228
Change in fair value of warrants
(852
)
(57,839
)
Closing balance
265
3,389
Less current portion
—
(5
)
Long term portion
265
3,384
The
derivative liability consists of the following warrants:
March 31,
2019
Number of
warrants
$
2015 Agent Warrants
2,177
265
Closing balance
2,177
265
Less current portion
—
—
Long-term portion
2,177
265
5
Stockholders'
equity
Preferred
stock
Series
B Preferred Shares
During
the year ended June 30, 2016, the Company issued an aggregate of 902,238 shares of Series B Preferred Stock at a purchase
price of at $8.00 per share. Each share of Series B Preferred Stock is convertible into 0.25 shares of common stock equating
to a conversion price of $32.00 (the "Conversion Price") and will automatically convert to common stock at the
earlier of 24 hours following regulatory approval of VAL-083 with a minimum closing bid price of $80.00 or five years from
the final closing date. The holders of the Series B Preferred Stock are entitled to an annual cumulative, in arrears,
dividend at the rate of 9% payable quarterly. The 9% dividend accrues quarterly commencing on the date of issue and is
payable quarterly on June 30, September 30, March 31, and March 31 of each year commencing on June 30, 2016. Dividends are payable solely by delivery of shares of common
stock, in an amount for each holder equal to the aggregate dividend payable to such holder with respect to the shares of Series
B Preferred Stock held by such holder divided by the Conversion Price. The Series B Preferred Stock does not contain any repricing
features. Each share of Series B Preferred Stock entitles its holder to vote with the common stock on an as-converted basis.
F-
9
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
In
addition, the Company and the holders entered into a royalty agreement, pursuant to which the Company will pay the holders of
the Series B Preferred Stock, in aggregate, a low, single-digit royalty based on their pro rata ownership of the Series B Preferred
Stock on products sold directly by the Company or sold pursuant to a licensing or partnering arrangement (the "Royalty Agreement").
Upon
conversion of a holder's Series B Preferred Stock to common stock, such holder shall no longer receive ongoing royalty payments
under the Royalty Agreement but will be entitled to receive any residual royalty payments that have vested. Rights to the royalties
shall vest during the first three years following the applicable closing date, in equal thirds to holders of the Series B Preferred
Stock on each of the three vesting dates, upon which vesting dates such royalty amounts shall become vested royalties.
Pursuant
to the Series B Preferred Stock dividend, during the three months ended March 31, 2019, the Company issued 4,735 (2018 –
4,960) shares of common stock and recognized $23,202 (2018 – $46,626). During the nine months ended March 31, 2019, the
Company issued 14,430 (2018 – 14,881) shares of common stock and recognized $75,477 (2018 – $142,358). These dividends
have been recognized as a direct increase in accumulated deficit.
During
the nine months ended March 31, 2019, 40,000 Series B Preferred shares were converted to 10,000 shares of common stock. There
were no conversions during the three months ended March 31, 2019 and 2018 or for the nine months ended March 31, 2018. A total
of 841,113 (2018 – 881,113) shares of Series B Preferred Stock are outstanding as of March 31, 2019, such that a total of
210,279 (2018 – 220,279) shares of common stock are issuable upon conversion of the Series B Preferred Stock as at March
31, 2019. Converted shares are rounded up to the nearest whole share.
Series
A Preferred Shares
Effective
September 30, 2014 pursuant to the Company's Valent Exchange Agreement (note 3), the Company filed a Certificate of Designation
of Series A Preferred Stock (the "Series A Certificate of Designation") with the Secretary of State of Nevada. Pursuant
to the Series A Certificate of Designation, the Company designated 278,530 shares of preferred stock as Series A Preferred Stock.
The shares of Series A Preferred Stock have a stated value of $1.00 per share (the "Series A Stated Value") and are
not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3% of the
Series A Stated Value per year, payable quarterly in arrears. Upon any liquidation of the Company, the holder of the Series A
Preferred Stock will be entitled to be paid, out of any assets of the Company available for distribution to stockholders, the
Series A Stated Value of the shares of Series A Preferred Stock held by such holder, plus any accrued but unpaid dividends thereon,
prior to any payments being made with respect to the common stock.
F-
10
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
Common
stock
Shares of common stock outstanding
Common stock
Additional paid-in capital
Warrants
Accumulated deficit
$
$
$
$
Nine months ended March 31, 2019
Balance – June 30, 2018
2,296,667
2,297
43,198,193
8,229,482
(52,441,337
)
Exercise and exchange of warrants
296,667
297
2,920,695
(2,210,697
)
—
Warrants issued for services
—
—
—
36,534
—
Conversion of Series B preferred stock to common stock
10,000
10
279,041
—
—
Series B Preferred stock dividend
14,430
14
75,463
—
(75,477
)
Shares issued for services
2,269
2
10,267
—
—
Stock option expense
—
—
355,388
—
—
Performance stock unit expense
—
—
183,205
—
—
Series A Preferred cash dividend
—
—
—
—
(6,267
)
Loss for the period
—
—
—
—
(5,465,486
)
Balance – March 31, 2019
2,620,033
2,620
47,022,252
6,055,319
(57,988,567
)
Three months ended March 31, 2019
Balance – December 31, 2018
2,614,342
2,614
46,851,817
6,046,587
(56,299,291
)
Exercise and exchange of warrants – issue costs
—
—
(16,186
)
—
—
Warrants issued for services
—
—
—
8,732
—
Series B Preferred stock dividend
4,735
5
23,197
—
(23,202
)
Shares issued for services
956
1
3,512
—
—
Stock option expense
—
—
99,735
—
—
Performance stock unit expense
—
—
60,177
—
—
Series A Preferred cash dividend
—
—
—
—
(2,089
)
Loss for the period
—
—
—
—
(1,663,985
)
Balance – March 31, 2019
2,620,033
2,620
47,022,252
6,055,319
(57,988,567
)
F-
11
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
Shares of common stock outstanding
Common stock
Additional paid-in capital
Warrants
Accumulated deficit
$
$
$
$
Nine months ended March 31, 2018
Balance – June 30, 2017
1,450,963
1,451
36,678,344
4,570,574
(41,118,433
)
Issuance of shares and warrants
800,000
800
6,191,785
2,752,751
—
Warrants exercised for cash
25,000
25
312,475
—
—
Warrants issued for services
—
—
—
155,204
—
Series B Preferred stock dividend
14,881
15
142,343
—
(142,358
)
Shares issued for services
407
—
4,821
—
—
Stock option expense
—
—
430,673
—
—
Series A Preferred cash dividend
—
—
—
—
(6,267
)
Loss for the period
—
—
—
—
(8,761,061
)
Balance – March 31, 2018
2,291,251
2,291
43,760,441
7,478,529
(50,028,119
)
Three months ended March 31, 2018
Balance – December 31, 2017
2,260,884
2,261
43,259,228
7,321,844
(47,046,347
)
Warrants exercised for cash
25,000
25
312,475
—
—
Warrants issued for services
—
—
—
156,685
—
Series B Preferred stock dividend
4,960
5
46,621
—
(46,626
)
Shares issued for services
407
—
4,821
—
—
Stock option expense
—
—
137,296
—
—
Series A Preferred cash dividend
—
—
—
—
(2,089
)
Loss for the period
—
—
—
—
(2,933,057
)
Balance – March 31, 2018
2,291,251
2,291
43,760,441
7,478,529
(50,028,119
)
The
issued and outstanding common shares at March 31, 2019 include 9,063 (June 30, 2018 – 91,276) shares of common stock on
an as-exchanged basis with respect to the shares of Exchangeco that can be exchanged for shares of common stock of the Company.
Nine
months ended March 31, 2018
On
September 22, 2017, the Company completed a registered direct offering (the "2018 Registered Offering") of an aggregate
of 800,000 shares of common stock and warrants to purchase an additional 800,000 shares of common stock at a price of $12.50 per
share and related warrant for gross proceeds of $10.0 million. The warrants have an exercise price of $12.50 per share, are immediately
exercisable and have a term of exercise of five years (the "2018 Investor Warrants").
The
Company engaged a placement agent for the 2018 Registered Offering. Under the Company's engagement agreement with the placement
agent, the Company paid $800,000 in cash commission and other fees to the placement agent and issued warrants to purchase 40,000
shares of common stock to the placement agent (the "2018 Agent Warrants"). The 2018 Agent Warrants are exercisable
at a per share price of $12.50 and have a term of exercise of five years.
In
addition to the cash commission and other placement agent fees, the Company also incurred additional cash issue costs of $254,664
resulting in net cash proceeds of $8,945,336.
F-
12
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
2017
Omnibus Incentive Plan
As
approved by the Company's stockholders at the annual meeting of stockholders held on April 11, 2018, on July 7, 2017, as
amended on February 1, 2018, the Company's board of directors approved adoption of the Company's 2017 Omnibus Equity
Incentive Plan (the "2017 Plan"). The board of directors also approved a form of Performance Stock Unit Award Agreement
to be used in connection with grants of performance stock units ("PSUs") under the 2017 Plan. Under the 2017 Plan,
780,000 shares of Company common stock are reserved for issuance, less the number of shares of common stock issued under the Del
Mar (BC) 2013 Amended and Restated Stock Option Plan (the "Legacy Plan") or that are subject to grants of stock options
made, or that may be made, under the Legacy Plan. A total of 169,985 shares of common stock have been issued under the Legacy
Plan and/or are subject to outstanding stock options granted under the Legacy Plan, and a total of 122,698 shares of common stock
have been issued under the 2017 Plan and/or are subject to outstanding stock options granted under the 2017 Plan. In addition,
120,000 PSU's have been issued under the 2017 Plan leaving a potential 367,317 shares of common stock available for issuance
under the 2017 Plan if all such options under the Legacy Plan were exercised and no new grants are made under the Legacy Plan.
The maximum number of shares of Company common stock with respect to which any one participant may be granted awards during any
calendar year is 8% of the Company's fully diluted shares of common stock on the date of grant (excluding the number of
shares of common stock issued under the 2017 Plan and/or the Legacy Plan or subject to outstanding awards granted under the 2017
Plan and/or the Legacy Plan). No award will be granted under the 2017 Plan on or after July 7, 2027, but awards granted prior
to that date may extend beyond that date.
Performance
stock units
The
Company's board of directors has granted PSUs under the 2017 Plan to the Company's directors. The awards represent
the right to receive shares of the Company's common stock upon vesting of the PSU based on targets approved by the Company's
board of directors related to the Company's fully diluted market capitalization. The PSUs vest at various fully diluted
market capitalization levels with full vesting occurring upon the later of one year from the grant date and the Company achieving
a fully diluted market capitalization of at least $500 million for five consecutive business days. The PSUs expire on July 7,
2022. There are 120,000 PSUs outstanding as of March 31, 2019 and June 30, 2018.
The
Company has recognized $60,177 (2018 - $0) and $183,205 (2018 - $0) in expense related to the PSUs during the three and nine months
ended March 31, 2019, respectively, with all of it being recognized as general and administrative expense. As at March 31, 2019
there was $342,936 (2018 - $0) in unrecognized compensation expense that will be recognized over the next 2.47 years.
The
PSUs have been valued using the following assumptions:
Dividend rate
0%
Volatility
79.0 to 82.5%
Risk-free rate
2.56% to 2.71%
Term
–
years
1.67 to 3.24
F-
13
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
Stock
Options
The
following table sets forth the stock options outstanding under all plans as of March 31, 2019:
Number of
stock options
outstanding
Weighted
average
exercise
price
Balance – June 30, 2018
262,683
24.27
Granted
30,000
6.10
Balance – March 31, 2019
292,683
22.40
The
following table summarizes stock options currently outstanding and exercisable at March 31, 2019 under all plans:
Exercise price
$
Number
Outstanding
Weighted average
remaining
contractual life
(years)
Number
exercisable
6.10
30,000
9.60
6,666
7.00
5,451
9.23
—
8.70
12,000
8.59
12,000
9.83
83,647
9.14
23,235
10.60
3,600
9.03
1,200
11.70
30,000
3.91
30,000
14.98
2,500
3.17
2,500
20.00
13,125
2.52
13,125
21.10
15,900
7.51
8,700
29.60
4,500
5.84
4,500
32.00
3,000
0.17
3,000
37.60
4,500
6.86
4,500
40.00
1,250
0.50
1,250
41.00
4,000
7.61
3,111
42.00
41,250
3.81
41,250
44.80
3,000
6.86
3,000
49.50
22,460
5.31
18,458
53.20
8,000
7.10
7,555
61.60
1,500
4.00
1,500
92.00
3,000
4.17
3,000
292,683
188,550
F-
14
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
Included
in the number of stock options outstanding are 2,500 stock options granted at an exercise price of CA $20.00. The exercise prices
shown in the above table have been converted to US $14.98 using the period ending closing exchange rate. Certain stock options
have been granted to non-employees and will be revalued at each reporting date until they have fully vested. The stock options
granted, and those being re-valued, have been valued using a Black-Scholes pricing model using the following assumptions:
March
    31,
2019
Dividend
    rate
0%
Volatility
70.6% to 79.1%
Risk-free
    rate
2.1% to 3.2%
Term
    - years
0.1 to 3.0
The
Company has recognized the following amounts as stock option expense for the periods noted:
Three months ended
March 31,
Nine months ended
March 31,
2019
$
2018
$
2019
$
2018
$
Research and development
12,889
9,145
64,466
130,546
General and administrative
86,846
128,151
290,922
300,127
99,735
137,296
355,388
430,673
All
of the stock option expense for the periods ended March 31, 2019 and 2018 has been recognized as additional paid in capital. The
aggregate intrinsic value of stock options outstanding at March 31, 2019 was $0 (2018 – $8,400) and the aggregate intrinsic
value of stock options exercisable at March 31, 2019 was $0 (2018 – $2,800). As of March 31, 2019, there was $234,974 in
unrecognized compensation expense that will be recognized over the next 2.61 years. No stock options granted under any plan have
been exercised to March 31, 2019. Upon the exercise of stock options new shares will be issued.
A
summary of the Company's unvested stock options under all plans is presented below:
Number of Options
Weighted average
exercise price
$
Weighted average
grant date
fair value
$
Unvested at June 30, 2018
138,160
14.39
7.63
Granted
30,000
6.10
2.56
Vested
(64,027
)
14.82
7.88
Unvested at March 31, 2019
104,133
11.62
5.95
F-
15
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
Warrants
Certain
of the Company's warrants have been recognized as a derivative liability (note 4). The following table summarizes changes
in the Company's outstanding warrants as of March 31, 2019:
Description
Number
Balance – June 30, 2018
1,428,128
Exercised for cash (i)
(197,500
)
Cashless exchange (i)
(297,500
)
Issued for services (ii)
14,000
Forfeited (iii)
(2,400
)
Expired (iv)
(82,225
)
Balance - March 31, 2019
862,503
i)
On
November 25, 2018, the Company entered into Warrant Exercise and Exchange Agreements (the "Warrant Exercise Agreements")
with certain holders (the "Exercising Holders") of the 2018 Investor Warrants. Pursuant to the Warrant Exercise Agreements,
in order to induce the Exercising Holders to exercise the 2018 Investor Warrants for cash, the Company agreed to reduce the exercise
price from $12.50 to $4.00 per share. Pursuant to the Warrant Exercise Agreements, the Exercising Holders exercised their 2018
Investor Warrants with respect to an aggregate of 197,500 shares of common stock underlying such 2018 Investor Warrants (the "Exercised
Shares"). The Company received net proceeds of $726,481, comprising aggregate gross proceeds of $790,000 net of expenses
of $63,519, from the exercise of the 2018 Investor Warrants.
In addition, in order to further induce the Exercising Holders to exercise the 2018 Investor Warrants, the Warrant Exercise Agreements also provided for the issuance of one share of common stock to the Exercising Holders in exchange for every three shares of common stock underlying the 2018 Investor Warrants held by the Exercising Holders that are not being exercised for cash pursuant to the Warrant Exercise Agreements, if any. On November 26, 2018, the Company issued an aggregate of 99,167 shares of common stock in exchange for 297,500 2018 Investor Warrants, resulting in a 198,333 reduction in the Company's total shares of common stock outstanding on a fully-diluted basis.
ii)
All
of the warrants issued for services are exercisable at $9.00 with 12,000 expiring on September 15, 2023 and 2,000 expiring on
October 11, 2021. Of the total, 12,000 vest pro rata monthly over twelve months commencing September 15, 2018 and 2,000 are fully
vested as of November 11, 2018.
iii)
Warrants
issued for services exercisable at $11.70 were forfeited upon termination of the underlying agreement.
iv)
Warrants
issued for services exercisable at $70.40 expired September 12, 2018. In addition, warrants exercisable at $31.40 expired March
31, 2019.
F-
16
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
5
Stockholders'
equity
(cont.)
The
following table summarizes the Company's outstanding warrants as of March 31, 2019:
Description
Number
Exercise
    price
$
Expiry
    date
2018
    Investor
280,000
12.50
September 22, 2022
2017
    Investor
207,693
35.00
April 19, 2022
2015
    Investor
97,900
30.00
July 31, 2020
2013
    Placement Agent
126,250
31.40
June 30, 2019
Issued
    for services
26,500
30.00
July 1, 2020 to February
    1, 2021
Issued
    for services
6,000
17.80
January 25, 2023
Issued
    for services
33,600
11.70
February 27, 2023
Issued
    for services
12,000
9.00
September 15, 2023
Issued
    for services
4,140
59.30
February 27, 2020
Issued
    for services
2,000
9.00
October 11, 2021
2018
    Agent
40,000
12.50
September 20, 2022
2017
    Agent
13,846
40.60
April 12, 2022
2016
    Agent
10,396
40.00
May 12, 2021
2015
    Agent
2,178
30.00
July 15, 2020
862,503
24.80
6
Financial
instruments
The
Company has financial instruments that are measured at fair value. To determine the fair value, we use the fair value hierarchy
for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs
by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use
to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs are
inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels of
inputs that may be used to measure fair value are as follows:
●
Level
one — inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities;
●
Level
two — inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either
directly or indirectly such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted
intervals; and
●
Level
three — unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect
those assumptions that a market participant would use.
Assets
and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes
in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value
hierarchy.
The
Company's financial instruments consist of cash and cash equivalents, other receivables, accounts payable, related party
payables and derivative liability. The carrying values of cash and cash equivalents, other receivables, accounts payable and related
party payables approximate their fair values due to the immediate or short-term maturity of these financial instruments.
F-
17
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
6
Financial
instruments
(cont.)
Derivative
liability
The
Company accounts for certain warrants under the authoritative guidance on accounting for derivative financial instruments indexed
to, and potentially settled in, a company's own stock, on the understanding that in compliance with applicable securities
laws, the warrants require the issuance of securities upon exercise and do not sufficiently preclude an implied right to net cash
settlement. The Company classifies these warrants on its balance sheet as a derivative liability which is fair valued at each
reporting period subsequent to the initial issuance. The Company has used a Black-Scholes Option Pricing Model (based on a closed-form
model that uses a fixed equation) to estimate the fair value of the share warrants. Determining the appropriate fair-value model
and calculating the fair value of warrants requires considerable judgment. Any change in the estimates (specifically probabilities
and volatility) used may cause the value to be higher or lower than that reported. The estimated volatility of the Company's
common stock at the date of issuance, and at each subsequent reporting period, is based on the historical volatility of the Company.
The risk-free interest rate is based on rates published by the government for bonds with a maturity similar to the expected remaining
life of the warrants at the valuation date. The expected life of the warrants is assumed to be equivalent to their remaining contractual
term.
a)
Fair
value of derivative liability
The
derivative is not traded in an active market and the fair value is determined using valuation techniques. The Company uses judgment
to select a variety of methods to make assumptions that are based on specific management plans and market conditions at the end
of each reporting period. The Company uses a fair value estimate to determine the fair value of the derivative liability. The
carrying value of the derivative liability would be higher, or lower, as management estimates around specific probabilities change.
The estimates may be significantly different from those amounts ultimately recorded in the consolidated financial statements because
of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an
active market. All changes in the fair value are recorded in the consolidated statement of operations and comprehensive loss each
reporting period. This is considered to be a Level 3 financial instrument as volatility is considered a Level 3 input.
The
Company has the following liabilities under the fair value hierarchy:
March 31, 2019
Liability
Level 1
Level 2
Level 3
Derivative liability
$
—
$
—
$
265
June 30, 2018
Liability
Level 1
Level 2
Level 3
Derivative liability
$
—
$
—
$
1,117
F-
18
DelMar
    Pharmaceuticals, Inc
.
Notes to Consolidated Condensed Interim Financial Statements
(Unaudited)
March 31, 2019
(expressed
in US dollars unless otherwise noted)
7
Supplementary
statement of cash flows information
Nine months ended
March 31,
2019
$
2018
$
Series B Preferred share common stock dividend (note 5)
75,477
142,358
Series B Preferred shares converted to common stock (note 5)
279,051
—
Share issuance costs accrued through accounts payable and accrued liabilities
15,884
—
Deferred financing costs accrued through accounts payable and accrued liabilities
15,873
—
Income taxes paid
—
—
Interest paid
—
—
8
Subsequent
events
Reverse
Stock Split
On
May 7, 2019, the Company filed a Certificate of Change with the Secretary of State of Nevada that effected a 1-for-10 (1:10) reverse
stock split of its common stock, par value $0.001 per share, which became effective on May 8, 2019. Pursuant to the Certificate
of Change, the Company's authorized common stock was decreased in the same proportion as the split resulting in a decrease
from 70,000,000 authorized shares of common stock to 7,000,000 shares authorized. The par value of its common stock was unchanged
at $0.001 per share, post-split. All common shares, warrants, stock options, conversion ratios, and per share information in these
consolidated condensed interim financial statements give retroactive effect to the 1-for-10 reverse stock split. The Company's
authorized and issued preferred stock was not affected by the split.
Rights
Offering
Subsequent
to March 31, 2019, the Company filed a registration statement relating to a rights offering for a maximum gross proceeds of $8.0
million. For every common share of stock owned (including each share of common stock issuable upon exercise of certain outstanding
warrants) as of the record date, the stockholder will receive one basic subscription right, which gives the stockholder the opportunity
to purchase one unit, consisting of one share of the Company's Series C Preferred Stock and 0.50 warrants, for a price of
$1,000 per Unit. The raising of any funds will not be assured until the closing of the offering which is expected to be in the
first week of June 2019.
Performance
Stock Units
On
April 30, 2019, the Company's Board of Directors approved the cancellation of all 120,000 PSU's outstanding at March
31, 2019.
2017
Omnibus Plan
On
April 30, 2019, the Company's Board of Directors also approved a temporary reduction in the reserve under the Company's
2017 Plan. As a result, the 367,317 shares of common stock available for issuance under the 2017 Plan as of March 31, 2019 was
reduced to 14,217. If the Company's authorized common shares are increased at the 2019 annual meeting of stockholders, the
reserve will be increased back to 367,317.
F-
19
Report
of Independent Registered Public Accounting Firm
To
the Board of Directors of DelMar Pharmaceuticals, Inc.
Opinion
on the Consolidated Financial Statements
We
have audited the accompanying consolidated balance sheets of DelMar Pharmaceuticals, Inc. (the "Company") as of June
30, 2018 and 2017, the related consolidated statements of operations and comprehensive loss, change in stockholders' equity
and cash flows for the years then ended, and the related notes (collectively referred to as the "consolidated financial
statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated
financial position of the Company as of June 30, 2018 and 2017, and the results of its consolidated operations and its consolidated
cash flows for the years then ended in conformity with U.S. generally accepted accounting principles.
The
Company's Ability to Continue as a Going Concern
The
accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern.
As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has stated that
substantial doubt exists about the Company's ability to continue as a going concern. Management's evaluation of the
events and conditions and management's plans regarding these matters are also described in Note 1. The consolidated financial
statements do not include any adjustments that might result from the outcome of this uncertainty.
Basis
for Opinion
These
consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an
opinion on the Company's consolidated financial statements based on our audits. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the US 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 audit
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether
due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated
financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures include
examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated 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 consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.
/s/
Ernst & Young LLP
We
have served as the Company's auditor since 2016.
Vancouver, Canada
September 21, 2018
except
for Note 11, as to which the date is
May
8, 2019
F-
20
DelMar
    Pharmaceuticals, Inc.
Consolidated Balance Sheets
(in
US dollars unless otherwise noted)
Note
June 30,
2018
$
June 30,
2017
$
Assets
Current assets
Cash and cash equivalents
5,971,995
6,586,014
Prepaid expenses and deposits
8
1,034,930
1,208,122
Interest, taxes and other receivables
39,519
76,595
7,046,444
7,870,731
Intangible assets – net
28,411
40,290
7,074,855
7,911,021
Liabilities
Current liabilities
Accounts payable and accrued liabilities
1,478,086
1,182,312
Related party payables
6
160,429
88,957
Current portion of derivative liability
4
—
33,091
1,638,515
1,304,360
Derivative liability
4
1,117
28,137
1,639,632
1,332,497
Stockholders' equity
Preferred stock
Authorized
5,000,000 shares, $0.001 par value
Issued and outstanding
278,530 Series A shares at June 30, 2018 (June 30, 2017 – 278,530)
3,5
278,530
278,530
881,113 Series B shares at June 30, 2018 (June 30, 2017 – 881,113)
5
6,146,880
6,146,880
1 special voting share at June 30, 2018 (June 30, 2017 – 1)
—
—
Common stock
Authorized
7,000,000 shares (June 30, 2017 – 5,000,000), $0.001 par value
2,296,667 issued at June 30, 2018 (June 30, 2017 – 1,450,963)
5
2,297
1,451
Additional paid-in capital
5
43,198,193
36,678,344
Warrants
5
8,229,482
4,570,574
Accumulated deficit
(52,441,337
)
(41,118,433
)
Accumulated other comprehensive income
21,178
21,178
5,435,223
6,578,524
7,074,855
7,911,021
Going
concern, nature of operations, and corporate history
(note 1)
Subsequent
events
(note 11)
The
accompanying notes are an integral part of these consolidated financial statements.
F-
21
DelMar
    Pharmaceuticals, Inc.
Consolidated Statements of Operations and Comprehensive Loss
(in
US dollars unless otherwise noted)
Note
Year ended
June 30,
2018
$
Year ended
June 30,
2017
$
Expenses
Research and development
6
7,132,952
5,003,640
General and administrative
6
4,041,711
3,317,189
11,174,663
8,320,829
Other loss (income)
Change in fair value of stock option and derivative liabilities
4,5
(60,111
)
(245,963
)
Foreign exchange loss
57,003
7,355
Interest income
(33,243
)
(457
)
(36,351
)
(239,065
)
Net and comprehensive loss for the year
11,138,312
8,081,764
Computation of basic loss per share
Net and comprehensive loss for the year
11,138,312
8,081,764
Series B Preferred stock dividend
5
176,236
790,454
11,314,548
8,872,218
Basic and fully diluted loss per share
5.42
7.36
Basic weighted average number of shares
2,086,142
1,204,708
The
accompanying notes are an integral part of these consolidated financial statements.
F-
22
DelMar
    Pharmaceuticals, Inc.
Consolidated Statements of Changes in Stockholders' Equity
(in
US dollars unless otherwise noted)
Number of
shares
Common
stock
$
Additional
paid-in
capital
$
Accumulated
other
comprehensive
income
$
Preferred
stock
$
Warrants
$
Accumulated
deficit
$
Stockholders'
equity
$
Balance – June 30, 2016
1,118,702
1,119
28,843,173
21,178
6,572,785
1,658,382
(32,237,859
)
4,858,778
Issuance of shares and warrants – net of issue costs
276,923
277
4,981,093
—
—
2,950,737
—
7,932,107
Shares issued for services
6,000
6
563,994
—
—
—
—
564,000
Warrants issued for services
—
—
—
—
—
81,602
—
81,602
Reclassification of stock option liability
—
—
260,969
—
—
—
—
260,969
Warrants exercised for cash
23,953
24
908,399
—
—
(120,147
)
—
788,276
Cashless exercise of warrants
59
—
5,159
—
—
—
—
5,159
Amendment of warrants (note 4)
—
—
53,006
—
—
—
—
53,006
Stock option expense
—
—
124,747
—
—
—
—
124,747
Conversion of Series B preferred stock to common stock
5,281
5
147,370
—
(147,375
)
—
—
—
Series A preferred cash dividend (note 3)
—
—
—
—
—
—
(8,356
)
(8,356
)
Series B preferred stock dividend
20,045
20
790,434
—
—
—
(790,454
)
—
Loss for the year
—
—
—
—
—
—
(8,081,764
)
(8,081,764
)
Balance – June 30, 2017
1,450,963
1,451
36,678,344
21,178
6,425,410
4,570,574
(41,118,433
)
6,578,524
Issuance of shares and warrants – net of issue costs
800,000
800
5,371,693
—
—
3,572,843
—
8,945,336
Shares issued for services
863
1
8,581
—
—
—
—
8,582
Warrants issued for services
—
—
—
—
—
192,400
—
192,400
Warrants exercised for cash (note 5)
25,000
25
418,810
—
—
(106,335
)
—
312,500
Stock option expense
—
—
495,925
—
—
—
—
495,925
Performance stock unit expense
—
—
48,624
—
—
—
—
48,624
Series A preferred cash dividend (note 3)
—
—
—
—
—
—
(8,356
)
(8,356
)
Series B preferred stock dividend
19,841
20
176,216
—
—
—
(176,236
)
—
Loss for the year
—
—
—
—
—
—
(11,138,312
)
(11,138,312
)
Balance – June 30, 2018
2,296,667
2,297
43,198,193
21,178
6,425,410
8,229,482
(52,441,337
)
5,435,223
The
accompanying notes are an integral part of these consolidated financial statements.
F-
23
DelMar
    Pharmaceuticals, Inc.
Consolidated Statements of Cash Flows
(in
US dollars unless otherwise noted)
Years ended June 30,
Note
2018
$
2017
$
Cash flows from operating activities
Loss for the year
(11,138,312
)
(8,081,764
)
Items not affecting cash
Amortization of intangible assets
24,528
16,683
Change in fair value of stock option and derivative liabilities
4,5
(60,111
)
(245,963
)
Shares issued for services
5
8,582
564,000
Warrants issued for services
5
192,400
81,602
Stock option expense
5
495,925
124,747
Performance stock unit expense
5
48,624
—
Changes in non-cash working capital
Prepaid expenses and deposits
8
173,192
(1,063,991
)
Interest, taxes and other receivables
37,076
(58,208
)
Accounts payable and accrued liabilities
295,774
598,310
Related party payables
6
71,472
45,513
(9,850,850
)
(8,019,071
)
Cash flows from investing activities
Intangible assets – website development costs
(12,649
)
(20,956
)
(12,649
)
(20,956
)
Cash flows from financing activities
Net proceeds from the issuance of shares and warrants
5
8,945,336
7,932,107
Proceeds from the exercise of warrants
5
312,500
545,026
Series A preferred stock dividend
5
(8,356
)
(8,356
)
9,249,480
8,468,777
(Decrease) increase in cash and cash equivalents
(614,019
)
428,750
Cash and cash equivalents – beginning of year
6,586,014
6,157,264
Cash and cash equivalents – end of year
5,971,995
6,586,014
Supplementary
information (note 9)
The
accompanying notes are an integral part of these consolidated financial statements.
F-
24
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
1
Going
concern, nature of operations, and corporate history
Going
concern
These
consolidated financial statements have been prepared on a going concern basis which assumes that DelMar Pharmaceuticals, Inc.
(the "Company") will continue its operations for the foreseeable future and contemplates the realization of assets
and the settlement of liabilities in the normal course of business.
For
the year ended June 30, 2018, the Company reported a loss of $11,138,312, and a negative cash flow from operations of $9,850,850.
The Company had an accumulated deficit of $52,441,337 as of June 30, 2018. As of June 30, 2018, the Company has cash and cash
equivalents on hand of $5,971,995. The Company is in the development stage and has not generated any revenues to date. The Company
does not have the prospect of achieving revenues until such time that its product candidate is commercialized, or partnered, which
may not ever occur. In the near future, the Company will require additional funding to maintain its clinical trials, research
and development projects, and for general operations. These circumstances indicate substantial doubt exists about the Company's
ability to continue as a going concern.
Consequently,
management is pursuing various financing alternatives to fund the Company's operations so it can continue as a going concern.
Management plans to secure the necessary financing through the issue of new equity and/or the entering into of strategic partnership
arrangements. The Company may tailor its drug candidate development program based on the amount of funding the Company is able
to raise in the future. Nevertheless, there is no assurance that these initiatives will be successful.
These
financial statements do not give effect to any adjustments to the amounts and classification of assets and liabilities that may
be necessary should the Company be unable to continue as a going concern. Such adjustments could be material.
Nature
of operations
The
Company is a clinical-stage drug development company with a focus on the treatment of cancer that is conducting clinical trials
in the United States with its product candidate, VAL-083, as a potential new treatment for glioblastoma multiforme, the most common
and aggressive form of brain cancer. The Company has also acquired certain commercial rights to VAL-083 in China where it is approved
as a chemotherapy for the treatment of chronic myelogenous leukemia and lung cancer. In order to accelerate the Company's
development timelines, the Company leverages existing clinical and commercial data from a wide range of sources. The Company may
seek marketing partnerships in order to generate future royalty revenue.
The
address of the Company's administrative offices is Suite 720 – 999 West Broadway, Vancouver, British Columbia, V5Z
1K5 with clinical operations located at 3485 Edison Way, Suite R, Menlo Park, California, 94025.
Corporate
history
The
Company is a Nevada corporation formed on June 24, 2009 under the name Berry Only Inc. On January 25, 2013 (the
"Reverse Acquisition Closing Date"), the Company entered into and closed an exchange agreement (the
"Exchange Agreement"), with Del Mar Pharmaceuticals (BC) Ltd. ("Del Mar (BC)"), 0959454 B.C. Ltd.
("Callco"), and 0959456 B.C. Ltd. ("Exchangeco") and the security holders of Del Mar (BC). Upon
completion of the Exchange Agreement, Del Mar (BC) became a wholly-owned subsidiary of the Company (the "Reverse
Acquisition").
DelMar
Pharmaceuticals, Inc. is the parent company of Del Mar (BC), a British Columbia, Canada corporation incorporated on April 6,
2010, which is a clinical stage company with a focus on the development of drugs for the treatment of cancer. The Company is
also the parent company to Callco and Exchangeco which are British Columbia, Canada corporations. Callco and Exchangeco were
formed to facilitate the Reverse Acquisition.
References to the Company refer to the Company and its wholly-owned
subsidiaries, Del Mar (BC), Callco and Exchangeco.
F-
25
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
Reverse
Stock Split
On
May 16, 2016, the Company filed a Certificate of Change with the Secretary of State of Nevada that effected a 1-for-4 (1:4) reverse
stock split of its common stock, par value $0.001 per share. The reverse split became effective on May 20, 2016. Pursuant to the
Certificate of Change, the Company's authorized common stock was decreased in the same proportion as the split resulting
in a decrease from 20,000,000 authorized shares of common stock to 5,000,000 shares authorized. The par value of its common stock
was unchanged at $0.001 per share, post-split. All common shares, warrants, stock options, conversion ratios, and per share information
in these consolidated financial statements give retroactive effect to the 1-for-4 reverse stock split. The Company's authorized
and issued preferred stock was not affected by the split.
Basis
of presentation
The
consolidated financial statements of the Company have been prepared in accordance with United States generally accepted accounting
principles ("US GAAP") and are presented in United States dollars. The Company's functional currency is the
United States dollar.
The
principal accounting policies applied in the preparation of these consolidated financial statements are set out below and have
been consistently applied to all years presented.
Consolidation
The
consolidated financial statements of the Company include the accounts of Del Mar (BC), Callco, and Exchangeco as at and for the
years ended June 30, 2018 and 2017. Intercompany balances and transactions have been eliminated in consolidation.
Use
of estimates
The
preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions about future
events that affect the reported amounts of assets, liabilities, expenses, contingent assets and contingent liabilities as at the
end of, or during, the reporting period. Actual results could significantly differ from those estimates. Significant areas requiring
management to make estimates include the derivative liability, the valuation of equity instruments issued for services, and clinical
trial accruals. Further details of the nature of these assumptions and conditions may be found in the relevant notes to these
consolidated financial statements.
Cash
and cash equivalents
Cash
and cash equivalents consist of cash and highly liquid investments with original maturities from the purchase date of three months
or less that can be readily convertible into known amounts of cash. Cash and cash equivalents are held at recognized Canadian
and United States financial institutions. Interest earned is recognized in the consolidated statement of operations and comprehensive
loss.
F-
26
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
Foreign
currency translation
The
functional currency of the Company at June 30, 2018 and 2017 is the United States dollar. Transactions that are denominated in
a foreign currency are remeasured into the functional currency at the current exchange rate on the date of the transaction. Any
foreign-currency denominated monetary assets and liabilities are subsequently remeasured at current exchange rates, with gains
or losses recognized as foreign exchange losses or gains in the consolidated statement of operations and comprehensive loss. Non-monetary
assets and liabilities are translated at historical exchange rates. Expenses are translated at average exchange rates during the
period. Exchange gains and losses are included in consolidated statement of operations and comprehensive loss for the period.
Current
and deferred income taxes
The
Company follows the liability method of accounting for income taxes. Under this method, current income taxes are recognized for
the estimated income taxes payable for the current period. Income taxes are accounted for using the asset and liability method
of accounting. Deferred income taxes are recognized for the future income tax consequences attributable to differences between
the carrying values of assets and liabilities and their respective income tax bases and for loss carry-forwards. Deferred income
tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which
temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change
in tax laws, or rates, is included in earnings in the period that includes the enactment date. When realization of deferred income
tax assets does not meet the more-likely-than-not criterion for recognition, a valuation allowance is provided.
Financial
instruments
The
Company has financial instruments that are measured at fair value. To determine the fair value, the Company uses the fair value
hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable
inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would
use to value an asset or liability and are developed based on market data obtained from independent sources. Unobservable inputs
are inputs based on assumptions about the factors market participants would use to value an asset or liability. The three levels
of inputs that may be used to measure fair value are as follows:
●
Level
one — inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities;
●
Level
two — inputs are inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either
directly or indirectly such as interest rates, foreign exchange rates, and yield curves that are observable at commonly quoted
intervals; and
●
Level
three — unobservable inputs developed using estimates and assumptions, which are developed by the reporting entity and reflect
those assumptions that a market participant would use.
Assets
and liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Changes
in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value
hierarchy.
The
Company's financial instruments consist of cash and cash equivalents, taxes and other receivables, accounts payable and
accrued liabilities, related party payables and derivative liability. The carrying values of cash and cash equivalents, taxes
and other receivables, accounts payable and accrued liabilities, and related party payables approximate their fair values due
to the immediate, or short-term, maturity of these financial instruments.
F-
27
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
Derivative
liability
The
Company accounts for certain warrants under the authoritative guidance on accounting for derivative financial instruments indexed
to, and potentially settled in, a company's own stock, on the understanding that in compliance with applicable securities
laws, the warrants require the issuance of securities upon exercise and do not sufficiently preclude an implied right to net cash
settlement. The Company classifies these warrants on its balance sheet as a derivative liability which is fair valued at each
reporting period subsequent to the initial issuance. The Company has used a binomial model as well as a Black-Scholes Option Pricing
Model (based on a closed-form model that uses a fixed equation) to estimate the fair value of the share warrants. Determining
the appropriate fair-value model and calculating the fair value of warrants requires considerable judgment. Any change in the
estimates (specifically probabilities and volatility) used may cause the value to be higher or lower than that reported. The estimated
volatility of the Company's common stock at the date of issuance, and at each subsequent reporting period, is based on the
historical volatility of the Company. The risk-free interest rate is based on rates published by the government for bonds with
a maturity similar to the expected remaining life of the warrants at the valuation date. The expected life of the warrants is
assumed to be equivalent to their remaining contractual term.
a)
Fair
value of derivative liability
The
derivative is not traded in an active market and the fair value is determined using valuation techniques. The Company uses judgment
to select a variety of methods to make assumptions that are based on specific management plans and market conditions at the end
of each reporting period. The Company uses a fair value estimate to determine the fair value of the derivative liability. The
carrying value of the derivative liability would be higher, or lower, as management estimates around specific probabilities change.
The estimates may be significantly different from those amounts ultimately recorded in the consolidated financial statements because
of the use of judgment and the inherent uncertainty in estimating the fair value of these instruments that are not quoted in an
active market. All changes in the fair value are recorded in the consolidated statement of operations and comprehensive loss each
reporting period. This is considered to be a Level 3 financial instrument as volatility is considered a Level 3 input.
The
Company has the following liabilities under the fair value hierarchy:
June 30, 2018
Liability
Level 1
Level 2
Level 3
Derivative liability
$
—
$
—
$
1,117
June 30, 2017
Liability
Level 1
Level 2
Level 3
Derivative liability
$
—
$
—
$
61,228
Intangible
assets
Website
development costs
Website
development costs are stated at cost less accumulated amortization. The Company capitalizes website development costs associated
with graphics design and development of the website application and infrastructure. Costs related to planning, content input,
and website operations are expensed as incurred. The Company amortizes website development costs on a straight-line basis over
three years. At June 30, 2018, the total capitalized cost was $79,910 (2017 – $67,261) and the Company has recognized $24,528
and $16,683, respectively, in amortization expense during the years ended June 30, 2018 and 2017.
F-
28
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
Patents
Expenditures
associated with the filing, or maintenance of patents, licensing or technology agreements are expensed as incurred. Costs previously
recognized as an expense are not recognized as an asset in subsequent periods. Once the Company has achieved regulatory approval,
patent costs will be deferred and amortized over the remaining life of the related patent.
Research
and development costs (including clinical trial expenses and accruals)
Research
and development expenses include payroll, employee benefits, stock-based compensation expense, and other headcount-related expenses
associated with research and development. Research and development expenses also include third-party development and clinical
trial expenses noted bel0w. Such costs related to research and development are included in research and development expense until
the point that technological feasibility is reached which, for the Company's drug candidate, is generally shortly before
the drug is approved by the relevant food and drug administration. Once technological feasibility is reached, such costs will
be capitalized and amortized to cost of revenue over the estimated life of the product.
Clinical
trial expenses are a component of research and development costs and include fees paid to contract research organizations, investigators
and other service providers who conduct specific research for development activities on behalf of the Company. The amount of clinical
trial expenses recognized in a period related to service agreements is based on estimates of the work performed on an accrual
basis. These estimates are based on patient enrollment, services provided and goods delivered, contractual terms and experience
with similar contracts. The Company monitors these factors by maintaining regular communication with the service providers. Differences
between actual expenses and estimated expenses recorded are adjusted for in the period in which they become known. Prepaid expenses
or accrued liabilities are adjusted if payments to service providers differ from estimates of the amount of service completed
in a given period.
Research
and development costs are expensed in the period incurred. As at June 30, 2018 and 2017, all research and development costs have
been expensed.
Shares
for services
The
Company has issued equity instruments for services provided by employees and non-employees. The equity instruments are valued
at the fair value of the instrument granted.
Stock
options
The
Company accounts for these awards under Accounting Standards Codification ("ASC") 718, "Compensation —
Stock Compensation" ("ASC 718"). ASC 718 requires measurement of compensation cost for all stock-based awards
at fair value on the date of grant and recognition of compensation over the requisite service period for awards expected to vest.
Compensation expense for unvested options to non-employees is revalued at each period end and is being amortized over the vesting
period of the options. The determination of grant-date fair value for stock option awards is estimated using the Black-Scholes
model, which includes variables such as the expected volatility of the Company's share price, the anticipated exercise behavior
of its grantee, interest rates, and dividend yields. These variables are projected based on the Company's historical data,
experience, and other factors. Changes in any of these variables could result in material adjustments to the expense recognized
for share-based payments. Such value is recognized as expense over the requisite service period, net of actual forfeitures, using
the accelerated attribution method. The Company recognizes forfeitures as they occur. The estimation of stock awards that will
ultimately vest requires judgment, and to the extent actual results, or updated estimates, differ from current estimates, such
amounts are recorded as a cumulative adjustment in the period estimates are revised.
F-
29
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
Performance
stock units
The
Company also accounts for performance stock units (PSU's) under ASC 718. ASC 718 requires measurement of compensation cost
for all stock-based awards at fair value on the date of grant and recognition of compensation over the requisite service period
for awards expected to vest. As vesting of the PSU's is based on a number of factors, the determination of the grant-date
fair value for PSU's has been estimated using a Monte Carlo simulation approach which includes variables such as the expected
volatility of the Company's share price and interest rates to generate potential future outcomes. These variables are projected
based on the Company's historical data, experience, and other factors. Changes in any of these variables could result in
material adjustments to the expense recognized for the PSUs. Such value is recognized as expense over the derived service period
using the accelerated attribution method. The estimation of PSUs that will ultimately vest requires judgment, and to the extent
actual results, or updated estimates, differ from current estimates, such amounts are recorded as a cumulative adjustment in the
period estimates are revised.
Comprehensive
income
In
accordance with ASC 220, "Comprehensive Income" ("ASC 220"), all components of comprehensive income, including
net loss, are reported in the financial statements in the period in which they are recognized. Comprehensive income is defined
as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net loss
and other comprehensive (income) loss, including foreign currency translation adjustments, are reported, net of any related tax
effect, to arrive at comprehensive income. No taxes were recorded on items of other comprehensive income.
Loss
per share
Income
or loss per share is calculated based on the weighted average number of common shares outstanding. For the years ended June 30,
2018 and 2017 diluted loss per share does not differ from basic loss per share since the effect of the Company's warrants,
stock options, performance stock units, and convertible preferred shares is anti-dilutive. As at June 30, 2018, potential common
shares of 1,690,810 (2017 – 774,976) related to outstanding warrants and stock options, 120,000 (2017 – 0) relating
to performance stock units, and 220,279 (2017 – 220,279) relating to outstanding Series B convertible preferred shares were
excluded from the calculation of net loss per common share because their inclusion would be anti-dilutive.
Segment
information
The
Company identifies its operating segments based on business activities, management responsibility and geographical location. The
Company operates within a single operating segment being the research and development of cancer indications, and operates primarily
in one geographic area, being North America. The Company is conducting one clinical trial in China but the planned expenses to
be incurred over the course of the study are not expected to be significant. All of the Company's assets are located in
either Canada or the United States.
Recent
accounting pronouncements
From
time to time, new accounting pronouncements are issued by the Financial Accounting Standards Board ("FASB") or other
standard setting bodies that are adopted by the Company as of the specified effective date.
F-
30
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
Recently
adopted
Accounting
Standards Board ("ASU") 2016-09 — Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment
Accounting
The
amendments in this update change existing guidance related to accounting for employee share-based payments affecting the income
tax consequences of awards, classification of awards as equity or liabilities, and classification on the statement of cash flows.
ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those
annual periods, with early adoption permitted. The adoption of ASU 2016-09 did not have a material impact on our results of operations
or financial condition.
Not
yet adopted
ASU
2016-01 — Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial
Liabilities
The
updated guidance enhances the reporting model for financial instruments and requires entities to use the exit price
notion when
measuring the fair value of financial instruments for disclosure purposes, and the separate presentation of financial assets and
financial liabilities by measurement category and form of financial asset (i.e., securities or loans and receivables) on the balance
sheet or the accompanying notes to the financial statements. The guidance is effective for annual reporting periods beginning
after December 15, 2017. The adoption of ASU 2016-01 is not expected to have a material impact on our results of operations or
financial condition.
ASU
2017-09 — Compensation — Stock Compensation (Topic 718): Scope of Modification Accounting
The
amendments in this update provide guidance about which changes to the terms, or conditions of a stock-based payment award, require
an entity to apply modification accounting in Topic 718. The amendments in ASU 2017-09 are effective for all entities for annual
periods, and interim periods within those annual periods, beginning after December 15, 2017. Early adoption is permitted, including
adoption in any interim period, for (1) public business entities for reporting periods for which financial statements have not
yet been issued and (2) all other entities for reporting periods for which financial statements have not yet been made available
for issuance. The Company is currently evaluating the potential impact of the adoption of this standard.
ASU
2017-11 — I. Accounting for Certain Financial Instruments with Down Round Features, II. Replacement of the Indefinite Deferral
for Mandatorily Redeemable Financial Instruments of Certain Non-public Entities and Certain Mandatorily Redeemable Noncontrolling
Interests with a Scope Exception
The
amendments in this update are intended to reduce the complexity associated with the accounting for certain financial instruments
with characteristics of liabilities and equity. Specifically, a down round feature would no longer cause a freestanding equity-linked
financial instrument (or an embedded conversion option) to be accounted for as a derivative liability at fair value with changes
in fair value recognized in current earnings. In addition, the indefinite deferral of certain provisions of Topic 480 have been
re-characterized to a scope exception. The re-characterization has no accounting effect. ASU 2017-11 is effective for public business
entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.Early adoption is
permitted. The Company is currently evaluating the potential impact of the adoption of this standard.
F-
31
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
2
Significant
accounting policies
(cont.)
ASU
2016-02 — Leases (Topic 842)
The
new standard establishes a right-of-use ("ROU") model that requires a lessee to record a ROU asset and a lease liability
on the consolidated balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance
or operating, with classification affecting the pattern of expense recognition in the consolidated income statement. ASU 2016-02
is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods, with
early adoption permitted. A modified retrospective transition approach is required for lessees for capital and operating leases
existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with
certain practical expedients available. The Company is currently evaluating the potential impact of the adoption of this standard.
ASU
2018-07 — Stock Compensation (Topic 718) Improvements to Nonemployee Shares-based payment Accounting
The
amendments in this update are intended to the reduce cost and complexity and to improve financial reporting for share-based payments
issued to nonemployees. The ASU expands the scope of Topic 718, Compensation — Stock Compensation, which currently only
includes share-based payments issued to employees, to also include share-based payments issued to nonemployees for goods and services.
The existing guidance on nonemployee share-based payments is significantly different from current guidance for employee share-based
payments. This ASU expands the scope of the employee share-based payments guidance to include share-based payments issued to nonemployees.
By doing so, the FASB improves the accounting of nonemployee share-based payments issued to acquire goods and services used in
its own operations. The amendments in this ASU are effective for public companies for fiscal years beginning after December 15,
2018, including interim periods within that fiscal year. The Company is currently evaluating the potential impact of the adoption
of this standard.
3
Valent
Technologies LLC agreements
One
of the Company's officers is a principal of Valent Technologies, LLC ("Valent") and as result Valent is a related
party to the Company.
On
September 12, 2010, the Company entered into a Patent Assignment Agreement (the "Valent Assignment Agreement") with
Valent pursuant to which Valent transferred to the Company all of its rights, title and interest in and to the patents for VAL-083
owned by Valent. The Company now owns all rights and title to VAL-083 and is responsible for the drug's further development
and commercialization. In accordance with the terms of the Valent Assignment Agreement, Valent is entitled to receive a future
royalty on all revenues derived from the development and commercialization of VAL-083. In the event that the Company terminates
the agreement, the Company may be entitled to receive royalties from Valent's subsequent development of VAL-083 depending
on the development milestones the Company has achieved prior to the termination of the Valent Assignment Agreement.
On
September 30, 2014, the Company entered into an exchange agreement (the "Valent Exchange Agreement") with Valent and
Del Mar (BC). Pursuant to the Valent Exchange Agreement, Valent exchanged its loan payable in the outstanding amount of $278,530
(including aggregate accrued interest to September 30, 2014 of $28,530), issued to Valent by Del Mar (BC), for 278,530 shares
of the Company's Series A Preferred Stock. The Series A Preferred Stock has a stated value of $1.00 per share (the "Series
A Stated Value") and is not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends
at the rate of 3% of the Series A Stated Value per year, payable quarterly in arrears. For each of the years ended June 30, 2018
and 2017 the Company recorded $8,356 related to the dividend paid to Valent. The dividends have been recorded as a direct increase
in accumulated deficit.
During
the year ended June 30, 2017, Valent exercised 12,500 common stock purchase warrants that had been issued to Valent pursuant to
the Valent Assignment Agreement. The exercised warrants represented all warrants that had been issued to Valent. The warrants
were exercised at $15.40 per share (CA $20.00) for total proceeds of $192,075.
F-
32
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
4
Derivative
liability
The
Company has issued common stock purchase warrants. Based on the terms of certain of these warrants the Company determined that
the warrants were a derivative liability which is recognized at fair value at the date of the transaction and remeasured at fair
value each reporting period with the changes in fair value recorded in the consolidated statement of operations and comprehensive
loss.
2013
Investor Warrants
During
the quarter ended March 31, 2013 the Company issued an aggregate of 328,125 units at a purchase price of $32.00 per unit, for
aggregate gross proceeds of $10,500,000. Each unit consisted of one share of common stock and one five-year warrant (the "2013
Investor Warrants") to purchase one share of common stock at an initial exercise price of $32.00. The exercise price of
the 2013 Investor Warrants is subject to adjustment in the event that the Company issues common stock at a price lower than the
exercise price, subject to certain exceptions. The 2013 Investor Warrants are redeemable by the Company at a price of $0.04 per
2013 Investor Warrant at any time subject to the conditions that (i) the Company's common stock has traded for twenty (20)
consecutive trading days with a closing price of at least $64.00 per share with an average trading volume of 50,000 shares per
day, and (ii) the underlying shares of common stock are registered for resale.
As
a result of the financing completed by the Company during the three months ended September 30, 2015, the exercise price of all
of the 2013 Investor Warrants was reduced from $32.00 to $31.40. As a result of the financing completed by the Company during
the three months ended September 30, 2017, the exercise price of certain of the 2013 Investor Warrants was further reduced from
$31.40 to $26.80. The change in exercise price did not result in a material change in the fair value of the derivative liability.
All of the 2013 Investor Warrants giving rise to their respective portion of the derivative liability have expired as of June
30, 2018.
2013
Investor Warrant exercises
During
the year ended June 30, 2017, 6,010 of the 2013 Investor Warrants were exercised at an exercise price of $31.40 per share. Also,
500 of the previously amended 2013 Investor Warrants were exercised. The Company received proceeds of $204,659 from these exercises.
The warrants that have been exercised were revalued at their respective exercise dates and then the reclassification to equity
was recorded resulting in $238,474 of the derivative liability being reclassified to equity.
There
were no exercises of 2013 Investor Warrants during the year ended June 30, 2018.
2013
Investor Warrant amendments
During
the year ended June 30, 2017, 1,594 of the 2013 Investor Warrants were amended. As a result, the Company has reclassified $53,006
from the derivative liability to equity. The 2013 Investor Warrants were revalued to their respective amendment dates and were
then reclassified to equity.
There
were no amendments of 2013 Investor Warrants during the year ended June 30, 2018.
2015
Agent Warrants
As
part of the Company's financing completed in a prior period, the Company issued warrants to purchase 2,348 shares of common
stock to certain placement agents ("2015 Agent Warrants") and recognized them as a derivative
liability of $29,594 at the time of issuance. The 2015 Agent Warrants are exercisable at a per share price equal to $30.00 until
July 15, 2020. During the year ended June 30, 2017, 68 of the 2015 Agent Warrants were exercised for cash proceeds of $2,040 and
100 of the 2015 Agent Warrants were exercised on a cashless basis for 59 shares of common stock. The total reclassification to
equity subsequent to revaluation at the respective exercise dates was $9,935.
F-
33
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
4
Derivative
liability
(cont.)
There
were no exercises of the 2015 Agent Warrants during the year ended June 30, 2018.
The
Company's derivative liability is summarized as follows:
Years ended
June 30,
2018
$
2017
$
Opening balance
61,228
693,700
Change in fair value of warrants
(60,111
)
(331,057
)
Reclassification to equity upon amendment of warrants
—
(53,006
)
Reclassification to equity upon exercise of warrants
—
(248,409
)
Closing balance
1,117
61,228
Less current portion
—
(33,091
)
Long-term portion
1,117
28,137
The
derivative liability consists of the following warrants as at June 30, 2018 and 2017:
Year ended
June 30, 2018
Number of
warrants
$
Warrants issued for services
4,375
—
2015 Agent warrants
2,177
1,117
Closing balance
6,552
1,117
Less current portion
—
—
Long-term portion
6,552
1,117
Year
    ended
June 30, 2017
Number of
warrants
$
2013 investor warrants
10,513
33,091
Warrants issued for services
4,375
4,468
2015 Agent warrants
2,177
23,669
Closing balance
17,065
61,228
Less current portion
(10,513
)
(33,091
)
Long-term portion
6,552
28,137
F-
34
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
Preferred
stock
Authorized
5,000,000
preferred shares, $0.001 par value
Issued
and outstanding
Special
voting shares – at June 30, 2018 and 2017 – 1
Series
A shares – at June 30, 2018 – 278,530 (June 30, 2017 – 278,530)
Series
B shares – at June 30, 2018 – 881,113 (June 30, 2017 – 881,113)
Series
B Preferred Shares
During
the year ended June 30, 2016, the Company issued an aggregate of 902,238 shares of Series B Preferred Stock at a purchase price
of at $8.00 per share. Each share of Series B Preferred Stock is convertible into 0.25 shares of common stock equating to a conversion
price of $32.00 (the "Conversion Price") and will automatically convert to common stock at the earlier of 24 hours
following regulatory approval of VAL-083 with a minimum closing bid price of $80.00 or five years from the final closing date.
The holders of the Series B Preferred Stock are entitled to an annual cumulative, in arrears, dividend at the rate of 9% payable
quarterly. The 9% dividend accrues quarterly commencing on the date of issue and is payable quarterly on June 30, September 30,
December 31, and March 31 of each year commencing on June 30, 2016. Dividends are payable solely by delivery of shares of common
stock, in an amount for each holder equal to the aggregate dividend payable to such holder with respect to the shares of Series
B Preferred Stock held by such holder divided by the Conversion Price. The Series B Preferred Stock does not contain any repricing
features. Each share of Series B Preferred Stock entitles its holder to vote with the common stock on an as-converted basis.
In
addition, the Company and the holders entered into a royalty agreement, pursuant to which the Company will pay the holders of
the Series B Preferred Stock, in aggregate, a low, single-digit royalty based on their pro rata ownership of the Series B Preferred
Stock on products sold directly by the Company or sold pursuant to a licensing or partnering arrangement (the "Royalty Agreement").
Upon
conversion of a holder's Series B Preferred Stock to common stock, such holder shall no longer receive ongoing royalty payments
under the Royalty Agreement but will be entitled to receive any residual royalty payments that have vested. Rights to the royalties
shall vest during the first three years following the applicable closing date, in equal thirds to holders of the Series B Preferred
Stock on each of the three vesting dates, upon which vesting dates such royalty amounts shall become vested royalties.
Pursuant
to the Series B Preferred Stock dividend, during the year ended June 30, 2018, the Company issued 19,841 (2017 – 20,045)
shares of common stock and recognized $176,236 (2017 – $790,454) as a direct increase in accumulated deficit. During the
year ended June 30, 2018, a total of 0 (2017 – 21,125) shares of Series B Preferred Stock were converted for an aggregate
0 (2017 – 5,281) shares of common stock.
A
total of 881,113 (2017 – 881,113) shares of Series B Preferred Stock are outstanding as of June 30, 2018, such that a total
of 220,279 (2017 – 220,279) shares of common stock are issuable upon conversion of the Series B Preferred Stock as at June
30, 2018. Converted shares are rounded up to the nearest whole share.
Series
A Preferred Shares
Effective
December 31, 2014 pursuant to the Company's Valent Exchange Agreement (note 3), the Company filed a Certificate of Designation
of Series A Preferred Stock (the "Series A Certificate of Designation") with the Secretary of State of Nevada. Pursuant
to the Series A Certificate of Designation, the Company designated 278,530 shares of preferred stock as Series A Preferred Stock.
The shares of Series A Preferred Stock have a stated value of $1.00 per share (the "Series A Stated Value") and are
not convertible into common stock. The holder of the Series A Preferred Stock is entitled to dividends at the rate of 3% of the
Series A Stated Value per year, payable quarterly in arrears. Upon any liquidation of the Company, the holder of the Series A
Preferred Stock will be entitled to be paid, out of any assets of the Company available for distribution to stockholders, the
Series A Stated Value of the shares of Series A Preferred Stock held by such holder, plus any accrued but unpaid dividends thereon,
prior to any payments being made with respect to the common stock.
F-
35
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
Special
voting shares
In
connection with the Exchange Agreement (note 1), on the Reverse Acquisition Closing Date, the Company, Callco, Exchangeco and
Computershare Trust Company of Canada (the "Trustee") entered into a voting and exchange trust agreement (the "Trust
Agreement"). Pursuant to the Trust Agreement, Company issued one share of Special Voting Preferred Stock (the "Special
Voting Share") to the Trustee, and the parties created a trust for the Trustee to hold the Special Voting Share for the
benefit of the holders of the shares of Exchangeco acquired as part of the Reverse Acquisition (the "Exchangeable Shares")
(other than the Company and any affiliated companies) (the "Beneficiaries"). Pursuant to the Trust Agreement, the
Beneficiaries will have voting rights in the Company equivalent to what they would have had they received shares of common stock
in the same amount as the Exchangeable Shares held by the Beneficiaries.
In
connection with the Exchange Agreement and the Trust Agreement, on January 17, 2013, the Company filed a certificate of designation
of Special Voting Preferred Stock (the "Special Voting Certificate of Designation") with the Secretary of State of
Nevada. Pursuant to the Special Voting Certificate of Designation, one share of the Company's blank check preferred stock
was designated as Special Voting Preferred Stock. The Special Voting Preferred Stock votes as a single class with the common stock
and is entitled to a number of votes equal to the number of Exchangeable Shares of Exchangeco outstanding as of the applicable
record date (i) that are not owned by the Company or any affiliated companies and (ii) as to which the holder has received voting
instructions from the holders of such Exchangeable Shares in accordance with the Trust Agreement.
The
Special Voting Preferred Stock is not entitled to receive any dividends or to receive any assets of the Company upon any liquidation,
and is not convertible into common stock of the Company.
The
voting rights of the Special Voting Preferred Stock will terminate pursuant to and in accordance with the Trust Agreement. The
Special Voting Preferred Stock will be automatically cancelled at such time as the share of Special Voting Preferred Stock has
no votes attached to it.
Common
stock
Authorized
7,000,000
as at June 30, 2018 (2017 – 5,000,000) common shares, $0.001 par value
Issued
and outstanding at June 30, 2018 – 2,296,667 (2017 – 1,450,963). The issued and outstanding common shares at June
30, 2018 include 91,276 (2017 –98,276) shares of common stock on an as-exchanged basis with respect to the Exchangeable
Shares.
Public
offering financings
Year
ended June 30, 2018
On
September 22, 2017 the Company completed a registered direct offering (the "2018 Registered Offering") of an aggregate
of 800,000 shares of common stock and warrants to purchase an additional 800,000 shares of common stock at a price of $12.50 per
share and related warrant for gross proceeds of $10.0 million. The warrants have an exercise price of $12.50 per share, are immediately
exercisable and have a term of exercise of five years (the "2018 Investor Warrants").
F-
36
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
The
Company engaged a placement agent for the 2018 Registered Offering. Under the Company's engagement agreement with the placement
agent, the Company paid $800,000 in cash commission and other fees to the placement agent and issued warrants to purchase 40,000
shares of common stock to the placement agent (the "2018 Agent Warrants"). The 2018 Agent Warrants are exercisable
at a per share price of $12.50 and have a term of exercise of five years.
In
addition to the cash commission and other placement agent fees, the Company also incurred additional cash issue costs of $254,664
resulting in net cash proceeds of $8,945,336.
Year
ended June 30, 2017
On
April 12, 2017 the Company completed a registered public offering (the "2017 Public Offering") of an aggregate of
276,923 shares of common stock and warrants to purchase an additional 207,692 shares of common stock at a price of $32.50 per
share and related warrant for gross proceeds of approximately $9.0 million. The related warrants have an exercise price of $35.00
per share, are immediately exercisable, and have a term of exercise of five years (the "2017 Investor Warrants").
The
Company engaged a placement agent for the 2017 Public Offering. Under the Company's engagement agreement with the placement
agent, the Company agreed to pay up to an 8% cash commission and issue warrants to purchase shares of common stock (the "2017
Agent Warrants") up to the number of shares of common stock equal to 5% of the aggregate number of shares issued in the
2017 Public Offering. Pursuant to the placement agent agreement the Company issued 13,846 2017 Agent Warrants. The 2017 Agent
Warrants are exercisable at a per share price equal to $40.60 and have a term of exercise of five years.
In
addition to the cash commission the Company also incurred additional cash issue costs of $347,897 resulting in net cash proceeds
of $7,932,107. The 2017 Agent Warrants have been recognized as non-cash issue costs of $424,401. Including the fair value of the
2017 Agent Warrants, total issue costs were $1,492,298.
Shares
issued for services
During
the year ended June 30, 2018, the Company issued 863 (2017 – 6,000) shares of common stock for services resulting in the
recognition of $8,582 (2017 – $564,000) in expense. All of the shares issued for services for the year ended June 30, 2018
have been recognized as general and administrative expense and all of the shares issued for services for the year ended June 30,
2017 have been recognized as research and development expense.
2017
Omnibus Incentive Plan
As
approved by the Company's stockholders at the annual meeting of stockholders held on April 11, 2018, on July 7, 2017, as
amended on February 1, 2018, the Company's board of directors approved adoption of the Company's 2017 Omnibus Equity
Incentive Plan (the "2017 Plan"). The board of directors also approved a form of Performance Stock Unit Award Agreement
to be used in connection with grants of performance stock units ("PSUs") under the 2017 Plan. Under the 2017 Plan,
780,000 shares of Company common stock are reserved for issuance, less the number of shares of common stock issued under
the Del Mar (BC) 2013 Amended and Restated Stock Option Plan (the "Legacy Plan") or that are subject to grants of
stock options made, or that may be made, under the Legacy Plan. A total of 169,985 shares of common stock, net of forfeitures,
have been issued under the Legacy Plan and/or are subject to outstanding stock options granted under the Legacy Plan, and a total
of 92,698 shares of common
stock have been issued under the 2017 Plan and/or are subject to outstanding stock options granted under the 2017 Plan. In addition,
120,000 PSU's have been issued under the 2017 Plan leaving a potential 397,317 shares of common stock available for issuance
under the 2017 Plan if all such options under the Legacy Plan were exercised and no new grants are made under the Legacy Plan.
The maximum number of shares of Company common stock with respect to which any one participant may be granted awards during any
calendar year is 8% of the Company's fully diluted shares of common stock on the date of grant (excluding the number of
shares of common stock issued under the 2017 Plan and/or the Legacy Plan or subject to outstanding awards granted under the 2017
Plan and/or the Legacy Plan). No award will be granted under the 2017 Plan on or after July 7, 2027, but awards granted prior
to that date may extend beyond that date.
F-
37
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
Performance
stock units
The
Company's board of directors has granted PSUs under the 2017 Plan to the Company's directors. The awards represent
the right to receive shares of the Company's common stock upon vesting of the PSU based on targets approved by the Company's
board of directors related to the Company's fully diluted market capitalization. The PSUs vest at various fully diluted
market capitalization levels with full vesting occurring upon the later of one year from the grant date and the Company achieving
a fully diluted market capitalization of at least $500 million for five consecutive business days. The PSUs expire on July 7,
2022.
The
following table sets forth the PSUs outstanding under the 2017 Plan as of June 30, 2018:
Number of
PSUs
outstanding
Balance – June 30, 2016 and 2017
—
Granted
140,000
Forfeited
(20,000
)
Balance – June 30, 2018
120,000
The
Company has recognized $48,624 (2017 – $0) in expense related to the PSUs during the year ended June 30, 2018 with all of
it being recognized as general and administrative expense. As at June 30, 2018 there was $526,140 (2017 – $0) in unrecognized
compensation expense that will be recognized over the next 3.24 years.
The
PSUs have been valued using the following assumptions:
June 30,
2018
Dividend rate
0
%
Volatility
79.0 to 82.5
%
Risk-free rate
2.56% to 2.71
%
Term
–
years
1.67 to 3.24
F-
38
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
Stock
options
The
following table sets forth the aggregate stock options outstanding under all plans as of June 30, 2018:
Number of
stock
options
outstanding
Weighted
average
exercise
price
Balance – June 30, 2016
85,625
37.77
Granted
26,460
48.22
Balance – June 30, 2017
112,085
41.81
Granted
152,698
11.35
Forfeited
(2,100
)
21.10
Balance – June 30, 2018
262,683
24.27
The
following table summarizes stock options currently outstanding and exercisable under all plans at June 30, 2018:
Exercise price
$
Number
Outstanding at
June 30,
2018
Weighted
average
    remaining
contractual life
(years)
Number
exercisable at
June 30,
2018
7.00
5,451
9.98
—
8.70
12,000
9.34
7,000
9.80
83,647
9.89
—
10.60
3,600
9.79
—
11.70
30,000
4.66
12,500
15.50
2,500
3.92
2,500
20.00
13,125
3.27
13,125
21.10
15,900
8.26
6,300
29.60
4,500
6.60
4,500
32.00
3,000
0.92
3,000
37.60
4,500
7.61
3,499
40.00
1,250
1.25
1,250
41.00
4,000
8.36
2,111
42.00
41,250
4.56
41,250
44.80
3,000
7.61
2,250
49.50
22,460
6.07
15,182
53.20
8,000
7.85
5,556
61.60
1,500
4.75
1,500
92.00
3,000
4.92
3,000
262,683
124,523
F-
39
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
Included
in the number of stock options outstanding are 2,500 stock options granted at an exercise price of CA $20.00. The exercise prices
for these stock options shown in the above table have been converted to $15.50 US$ using the period ending closing exchange rate.
Certain stock options have been granted to non-employees and will be revalued at each reporting date until they have fully vested.
The
stock options have been valued using a Black-Scholes pricing model using the following assumptions:
June 30,
2018
June 30,
2017
Dividend rate
0
%
0
%
Volatility
72.4 to 87.1
%
77.5% to 88.7
%
Risk-free rate
1.49% to 2.86
%
1.00% to 1.74
%
Term
–
years
0.6 to 3.03
3.0
The
Company has recognized the following amounts as stock option expense for the periods noted:
Years ended June 30,
2018
$
2017
$
Research and development
140,870
77,706
General and administrative
355,055
47,041
495,925
124,747
All
of the stock option expense of $495,925 (2017
–
$124,747) for the years ended June 30, 2018 and 2017 has been recognized
as additional paid in capital. The aggregate intrinsic value of stock options outstanding at June 30, 2018 was $0 (2017
–
$56,783) and the aggregate intrinsic value of stock options exercisable at June 30, 2018 was $0 (2017
–
$56,783).
As at June 30, 2018 there was $527,271 in unrecognized compensation expense that will be recognized over the next 2.9 years. No
stock options granted under the Plan have been exercised to June 30 2018. Upon the exercise of stock options new shares will be
issued.
A
summary of the status of the Company's unvested stock options as at June 30, 2018 under all plans is presented below:
Number of
options
Weighted
average
exercise
price
$
Weighted
average
grant date
fair value
$
Unvested at June 30, 2016
14,102
31.71
17.25
Granted
26,460
48.22
26.11
Vested
(8,759
)
46.81
24.83
Unvested at June 30, 2017
31,803
48.09
25.74
Granted
152,698
11.35
6.01
Vested
(44,241
)
27.81
15.02
Forfeited
(2,100
)
21.10
11.32
Unvested at June 30, 2018
138,160
14.39
7.63
The
aggregate intrinsic value of unvested stock options at June 30, 2018 was $0 (2017
–
$0). The unvested stock options
have a remaining weighted average contractual term of 8.81 (2017 – 9.35) years.
F-
40
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
Stock
option modifications
During
the year ended June 30, 2018, certain stock options were modified pursuant to a separation agreement with the Company's
former President and Chief Operating Officer. A total of 6,760 options had their vesting accelerated such that they became fully
vested on December 22, 2017, resulting in additional stock option expense of $93,777. In addition, a total of 21,860 options were
modified such that their remaining exercise period was increased from one year to three years, resulting in additional stock option
expense of $28,561.
Also,
during the year ended June 30, 2018, certain stock options were modified pursuant to the resignation of the Company's former
Chairman. A total of 1,500 options had their vesting accelerated such that they became fully vested on June 2, 2018, resulting
in additional stock option expense of $679. In addition, a total of 4,500 (including the 1,500 whose vesting was accelerated)
options were modified such that their remaining exercise period was increased from 90 days to one year, resulting in additional
stock option expense of $2,182.
Stock
option liability
Certain
of the Company's stock options have been issued in CA$. Of these, a portion was classified as a stock option liability which
was revalued at each reporting date. During the year ended June 30, 2017, the Company amended 4,375 of these stock options held
by five optionees such that the exercise price of the options was adjusted to be denominated in US$. No other terms of the stock
options were amended. As a result of the amendment, the Company recognized $85,094 in stock option liability expense and $260,969
was reclassified to equity during the year ended June 30, 2017.
Warrants
Number of
warrants
Amount
$
Balance – June 30, 2016
152,171
1,658,382
Issuance of 2017 Investor Warrants
(i)
207,693
2,526,336
Issuance of 2017 Agent Warrants
(i)
13,846
424,401
Exercise of Valent Warrants
(ii)
(12,500
)
(89,432
)
Exercise of 2015 Investor Warrants
(iii)
(4,875
)
(30,715
)
Warrants issued for services
(iv)
4,140
81,602
Balance – June 30, 2017
360,475
4,570,574
Issuance of 2018 Investor and 2018 Agent Warrants
(v)
840,000
3,572,843
Exercise of 2018 Investor Warrants
(v)
(25,000
)
(106,335
)
Warrants issued for services
(iv)
42,000
192,400
Balance – June 30, 2018
1,217,475
8,229,482
i)
As
part of the financing completed by the Company on April 12, 2017, the Company issued the 2017 Investor Warrants and the 2017 Agent
Warrants. The 2017 Investor Warrants are exercisable at $35.00 until April 19, 2022 and the 2017 Agent Warrants are exercisable
at $40.60 until April 12, 2022.
ii)
The
Valent warrants were exercised at $15.40 (CA$20.00) for proceeds of $192,075.
iii)
The
2015 Investor Warrants are exercisable at a price of $30.00. The warrants expire on July 31, 2020. During the year ended June
30, 2018, nil (2017
–
4,875) warrants were exercised for proceeds of $0 (2017
–
$146,250).
iv)
Warrants
issued for services are exercisable at various prices and expire at the various dates noted in the table below.
v)
As
part of the financing completed by the Company on September 22, 2017, the Company issued the 2018 Investor Warrants and the 2018
Agent Warrants. The 2018 Investor Warrants are exercisable at $12.50 until September 22, 2022 and the 2018 Agent Warrants are
exercisable at $12.50 until September 20, 2022.
F-
41
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
5
Stockholders'
equity (deficiency)
(cont.)
Certain
of the Company's warrants have been recognized as a derivative liability (note 4).
The
following table summarizes the changes in the Company's outstanding warrants as of June 30, 2018:
Description
Number
Balance – June 30, 2017
662,891
Issuance of 2018 Investor Warrants
800,000
Exercise of 2018 Investor Warrants
(25,000
)
Issuance of 2018 Agent Warrants
40,000
Warrants issued for services
42,000
Expiry of dividend warrants
(81,250
)
Expiry of 2013 Investor Warrants
(10,513
)
Balance – June 30, 2018
1,428,128
The
following table summarizes the Company's outstanding warrants as of June 30, 2018:
Description
Number
Exercise
price
$
Expiry date
2018 Investor
775,000
12.50
September 22, 2022
2017 Investor
207,693
35.00
April 19, 2022
2015 Investor
97,900
30.00
July 31, 2020
2013 Investor – Amended
77,850
31.40
March 31, 2019
2013 Placement Agent
126,250
31.40
June 30, 2019
Issued for services
26,500
30.00
July 31, 2020 to February 1, 2021
Issued for services
6,000
17.80
January 25, 2023
Issued for services
36,000
11.70
February 27, 2023
Issued for services
4,375
70.40
September 12, 2018
Issued for services
4,140
59.30
February 27, 2020
2018 Agent
40,000
12.50
September 20, 2022
2017 Agent
13,846
40.60
April 12, 2022
2016 Agent
10,397
40.00
May 12, 2021 to June 8, 2021
2015 Agent
2,177
30.00
July 15, 2020
1,428,128
20.80
6
Related
party transactions
During
the year ended June 30, 2018, the Company recognized a total expense of $311,683 relating to the settlement agreement with the
Company's former President and Chief Operating Officer. Amounts owed to related parties, including to the Company's
former President and Chief Operating Officer, are non-interest bearing and payable on demand.
F-
42
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
7
Current
and deferred income taxes
For
the years ended June 30, 2018, and 2017, the Company did not record a provision for income taxes due to a full valuation allowance
against our deferred tax assets.
Significant
components of the Company's future tax assets and deferred tax liabilities are shown below:
June 30,
2018
$
June 30,
2017
$
Deferred tax assets:
Non-capital losses carried forward
9,416,047
7,340,286
Capital losses carried forward
17,925
17,925
Financing costs
5,512
5,512
Scientific research and development
396,758
350,435
Scientific research and development – ITC
354,411
319,528
10,190,653
8,033,686
Deferred tax liabilities:
Scientific research and development – ITC
(61,230
)
(53,841
)
10,129,423
7,979,845
Valuation allowance
(10,129,423
)
(7,979,845
)
Net future tax assets
—
—
The
income tax benefit of these tax attributes has not been recorded in these consolidated financial statements because of the uncertainty
of their recovery. The Company's effective income tax rate differs from the statutory income tax rate of 21% (2017
–
34%).
The
differences arise from the following items:
June 30,
2018
$
June 30,
2017
$
Tax recovery at statutory income tax rates
(3,063,036
)
(2,747,800
)
Permanent differences
290,722
(15,342
)
Effect of rate differentials between jurisdictions
76,364
464,938
Impact of changes in income tax rates
138,516
—
Scientific research and development – ITC
(354,411
)
—
Other
75,422
(62,962
)
Change in valuation allowance
2,836,423
2,361,166
—
—
As
of June 30, 2018, the Company had combined US and Canadian net operating loss carryforwards of $34.7 million that begin expiring
in 2029. In addition, the Company has non-refundable Canadian federal investment tax credits of $226,778 that expire between 2029
and 2038 and non-refundable British Columbia investment tax credits of $127,633 that expire between 2019 and 2028.
F-
43
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
7
Current
and deferred income taxes
(cont.)
The
Tax Cuts and Jobs Act ("2017 Tax Act") was enacted in December 2017. The 2017 Tax Act, among other things, reduces
the U.S. federal corporate tax rate from 35% to 21%, effective January 1, 2018, requires companies to pay a one-time transition
tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign earnings.
The Company revalued our deferred tax assets as of June 30, 2018 based on a U.S. federal tax rate of 21%, which resulted in a
reduction to our deferred tax assets of $138,516 fully offset by a reduction to the valuation allowance. The Company is not required
to pay a one-time transition tax on earnings of our foreign subsidiary as the foreign subsidiary has an accumulated deficit.
8
Commitments
and contingencies
The
Company has the following obligations over the next five fiscal years ending June 30, 2023:
Clinical
development
The
Company has entered into contracts for drug manufacturing and clinical study management related to its Phase III clinical trial
for a total of $654,829. While this trial has now been parked, certain costs related to the parking of this trial as well as manufacturing
costs related to drug supply have been committed to by the Company. Pursuant to the commitment for clinical trial management,
the Company has paid a total of $921,027 in deposits related to study initiation and certain study costs. These deposits are available
to be applied against invoices received from the contract research organization but have not been netted against the Company's
commitments for the fiscal year ended June 30, 2018.
Office
lease
The
Company currently rents its offices on a month-to-month basis at a rate of $4,708 (CA$6,200) per month. During the year ended
June 30, 2018, the Company recorded $58,434 as rent expense (2017 – $35,908).
9
Supplementary
statement of cash flows information
Year
    ended
June 30,
2018
Year
    ended
June 30,
2017
Series
    B Preferred Stock common stock dividend (note 5)
176,236
790,454
Non-cash
    issue costs (note 5)
148,087
424,401
Reclassification
    of derivative liability to equity upon the exercise of warrants (note 4)
—
248,409
Reclassification
    of derivative liability to equity upon the amendment of warrants (note 4)
—
53,006
Reclassification
    of stock option liability to equity upon settlement (note 5)
—
260,969
Conversion
    of Series B Preferred Stock to common stock (note 5)
—
147,375
Income
    taxes paid
—
—
Interest
    paid
—
—
F-
44
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
10
Financial
risk management
Market
risk
Market
risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the
Company's income or valuation of its financial instruments.
The
Company is exposed to financial risk related to fluctuation of foreign exchange rates. Foreign currency risk is limited to the
portion of the Company's business transactions denominated in currencies other than the United Sates dollar, primarily general
and administrative expenses incurred in Canadian dollars. The Company believes that the results of operations, financial position
and cash flows would be affected by a sudden change in foreign exchange rates, but would not impair or enhance its ability to
pay its Canadian dollar accounts payable. The Company manages foreign exchange risk by converting its US$ to CA$ as needed. The
Company maintains the majority of its cash in US$. As at June 30, 2018, Canadian dollar denominated accounts payable and accrued
liabilities exposure in US$ totaled $106,132.
a)
Foreign
exchange risk
Foreign exchange risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. If foreign exchange rates were to fluctuate within +/-10% of the closing rate at
year-end, the maximum exposure is $6,788.
Balances
in foreign currencies at June 30, 2018 and 2017 are as follows:
June 30,
2018
balances
CA$
June 30,
2017
balances
CA$
Trade payables
79,858
164,226
Cash
41,459
39,251
Interest, taxes, and other receivables
14,618
99,397
b)
Interest
rate risk
The
Company is subject to interest rate risk on its cash and cash equivalents and believes that the results of operations, financial
position and cash flows would not be significantly affected by a sudden change in market interest rates relative to the investment
interest rates due to the short-term nature of the investments. As at June 30, 2018, cash and cash equivalents held in by the
Company was $5,971,995. The Company's cash balance currently earns interest at standard bank rates. If interest rates were
to fluctuate within +/-10% of the closing rate at year end the impact of the Company's interest-bearing accounts will be
not be significant due to the current low market interest rates.
The
only financial instruments that expose the Company to interest rate risk are its cash and cash equivalents.
Liquidity
risk
Liquidity
risk is the risk that the Company will encounter difficulty in raising funds to meet cash flow requirements associated with financial
instruments. The Company continues to manage its liquidity risk based on the outflows experienced for the period ended June 30,
2018 and is undertaking efforts to conserve cash resources wherever possible. The maximum exposure of the Company's liquidity
risk is $1,638,515 as at June 30, 2018.
F-
45
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
10
Financial
risk management
(cont.)
Credit
risk
Credit
risk arises from cash and cash equivalents, deposits with banks, financial institutions, and contractors as well as outstanding
receivables. The Company limits its exposure to credit risk, with respect to cash and cash equivalents, by placing them with high
quality credit financial institutions. The Company's cash equivalents consist primarily of operating funds with commercial
banks. Of the amounts with financial institutions on deposit, the following table summarizes the amounts at risk should the financial
institutions with which the deposits are held cease trading:
The
maximum exposure of the Company's credit risk is $39,519 at June 30, 2018 relating to interest, taxes, and other receivables.
The credit risk related to uninsured cash and cash equivalents balances is $5,868,825 at June 30, 2018.
Cash
    and
cash
equivalents
$
Insured
amount
$
Non-insured
amount
$
5,971,995
103,170
5,868,825
Concentration
of credit risk
Financial
instruments that subject the Company to credit risk consist primarily of cash and cash equivalents.
The
Company places its cash and cash equivalents in accredited financial institutions and therefore the Company's management
believes these funds are subject to minimal credit risk. The Company has no significant off-balance sheet concentrations of credit
risk such as foreign currency exchange contracts, option contracts or other hedging arrangements.
11
Subsequent
events
Reverse
Stock Split
On
May 7, 2019, the Company filed a Certificate of Change with the Secretary of State of Nevada that effected a 1-for-10 (1:10) reverse
stock split of its common stock, par value $0.001 per share, which became effective on May 8, 2019. Pursuant to the Certificate
of Change, the Company's authorized common stock was decreased in the same proportion as the split resulting in a decrease
from 70,000,000 authorized shares of common stock to 7,000,000 shares authorized. The par value of its common stock was unchanged
at $0.001 per share, post-split. All common shares, warrants, stock options, conversion ratios, and per share information in these
consolidated financial statements give retroactive effect to the 1-for-10 reverse stock split. The Company's authorized
and issued preferred stock was not affected by the split.
Rights
Offering
Subsequent
to June 30, 2018, the Company filed a registration statement relating to a rights offering for a maximum gross proceeds of $8.0
million. For every common share of stock owned (including each share of common stock issuable upon exercise of certain outstanding
warrants) as of the record date, the stockholder will receive one basic subscription right, which gives the stockholder the opportunity
to purchase one unit, consisting of one share of the Company's Series C Preferred Stock and 0.50 warrants, for a price of
$1,000 per Unit. The raising of any funds will not be assured until the closing of the offering which is expected to be in the
first week of June 2019.
F-
46
DelMar
    Pharmaceuticals, Inc.
Notes to Consolidated Financial Statements
June 30, 2018
(in
US dollars unless otherwise noted)
11
Subsequent
events
(cont.)
Performance
Stock Units
On
April 30, 2019 the Company's Board of Directors approved the cancellation of all 120,000 PSU's outstanding at June
30, 2018.
2017
Omnibus Plan
On
April 30, 2019 the Company's Board of Directors also approved a temporary reduction in the reserve under the Company's
2017 Plan. As a result, the 367,317 shares of common stock available for issuance under the 2017 Plan as of March 31, 2019 was
reduced to 14,217. If the Company's authorized common shares are increased at the 2019 annual meeting of stockholders, the
reserve will be increased back to 367,317.
F-
47
760,500
Shares of Common Stock
Issuable
upon Exercise of Outstanding Warrants
PROSPECTUS
,
    2019
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
13.     Other Expenses of Issuance and Distribution
The
following is a statement of estimated expenses in connection with the issuance and distribution of the securities being registered.
All expenses incurred with respect to the registration of the common stock will be borne by us. All amounts are estimates except
the SEC registration fee.
Item
Amount to be
Paid
SEC registration fee
$
141.95
Legal fees and expenses
25,000.00
Accounting fees and expenses
15,000.00
Miscellaneous expenses
858.05
Total
$
41,000.00
Item
14.     Indemnification of Directors and Officers
Neither
our Articles of Incorporation or our Bylaws prevent us from indemnifying our officers, directors and agents to the extent permitted
under the Nevada Revised Statute ("NRS"). NRS Section 78.7502 provides that a corporation shall indemnify any director,
officer, employee or agent of a corporation against expenses, including attorneys' fees, actually and reasonably incurred
by him in connection with any the defense to the extent that a director, officer, employee or agent of a corporation has been
successful on the merits or otherwise in defense of any action, suit or proceeding referred to Section 78.7502(1) or 78.7502(2),
or in defense of any claim, issue or matter therein.
NRS
Section 78.7502(1) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by reason of the fact that he is or was a director, officer, employee
or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys' fees,
judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with the action, suit or
proceeding if he: (a) is not liable pursuant to NRS Section 78.138; or (b) acted in good faith and in a manner which he reasonably
believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding,
had no reasonable cause to believe his conduct was unlawful.
NRS
Section 78.7502(2) provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor,
by reason of the fact that he is or was a director, officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust
or other enterprise against expenses, including amounts paid in settlement and attorneys' fees actually and reasonably incurred
by him in connection with the defense or settlement of the action or suit if he: (a) is not liable pursuant to NRS Section 78.138;
or (b) acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation.
Indemnification may not be made for any claim, issue or matter as to which such a person has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals there from, to be liable to the corporation or for amounts paid in settlement to
the corporation, unless and only to the extent that the court in which the action or suit was brought or other court of competent
jurisdiction determines upon application that in view of all the circumstances of the case, the person is fairly and reasonably
entitled to indemnity for such expenses as the court deems proper.
NRS
Section 78.747 provides that except as otherwise provided by specific statute, no stockholder, director or officer of a corporation
is individually liable for a debt or liability of the corporation, unless the director or officer acts as the alter ego of the
corporation. The court as a matter of law must determine the question of whether a director or officer acts as the alter ego of
a corporation.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933, as amended (the "Securities Act"), may
be permitted to directors, officers or controlling persons of ours, pursuant to the foregoing provisions, or otherwise, we have
been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act
and is therefore unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such a director, officer or controlling person in connection with the
securities being registered, 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 such indemnification by us is against public policy as expressed
hereby in the Securities Act and we will be governed by the final adjudication of such issue.
II-
1
Item
15.     Recent Sales of Unregistered Securities.
On
May 8, 2019, we effected a one-for-ten reverse stock split (the "Reverse Stock Split") of our issued and outstanding
and authorized common stock. All per share amounts and number of shares of common stock, in this Item 15 reflect the Reverse Stock
Split. The Reverse Stock Split does not affect the our authorized preferred stock of 5,000,000 shares; except that, pursuant to
the terms of the Certificate of Designations of Series B Convertible Preferred Stock for the issued and outstanding shares of
our Series B Convertible Preferred Stock, par value $0.001 per share (the "Series B Preferred Stock"), the conversion
price at which shares of Series B Preferred Stock may be converted into shares of common stock will be proportionately adjusted
to reflect the Reverse Stock Split.
Investment
Warrants
On
June 5, 2019, we completed a registered direct offering (the "RD Offering") with certain institutional investors of
an aggregate of 1,170,000 shares of common stock and, in a concurrent private placement, warrants to purchase 760,500 shares of
common stock at a combined purchase price of $3.10 per share and related warrant. The warrants have an exercise price of $3.10
per share, are immediately exercisable and have a term of exercise of five years. The gross proceeds from the offering, prior
to deducting offering expenses and placement agent fees and expenses payable by us, were $3.6 million. We issued additional warrants
to purchase 46,800 shares of common stock at an exercise price of $3.875 pursuant a placement agency agreement by and among us,
Maxim Group LLC and Dawson James Securities, Inc. for services provided in connection with the RD Offering.
On
November 25, 2018 we issued an aggregate of 99,167 shares of common stock in exchange for 297,500 exchanged warrants, pursuant
to Warrant Exercise and Exchange Agreements, dated as of November 25, 2018 with certain institutional investors.
On
September 20, 2017, we issued warrants to purchase 800,000 shares of common stock at an exercise price equal to $12.50 per whole
share of common stock, pursuant to a securities purchase agreement with certain institutional investors, and we issued additional
warrants to purchase 40,000 shares of common stock at an exercise price equal to $12.50 pursuant an engagement letter by and between
us and H.C. Wainwright & Co, LLC for services provided in connection with a securities offering of common stock and warrants.
On
April 12, 2017, we issued warrants to purchase 207,692 shares of common stock at an exercise price equal to $35.00 per whole share
of common stock, pursuant to a securities purchase agreement with certain institutional investors, and we issued additional warrants
to purchase 13,846 shares of common stock at an exercise price equal to $40.60 per whole share of common stock pursuant to an
engagement letter by and between us and Rodman & Renshaw, a unit of H.C. Wainwright & Co, LLC for services provided in
connection with a securities offering of common stock and warrants.
Series
B Preferred and Dividends
From
April 29, 2016 through June 8, 2016, we issued a total of 902,238 shares of our Series B Preferred Shares which are convertible
into 225,560 for gross proceeds of $7,217,904.
During
the three-year period ended June 30, 2018, we issued 42,921 shares of common stock as dividends on our outstanding shares of Series
B Preferred Stock.
II-
2
Exchangeable
Shares
During
the three-year period ended June 30, 2018, 15,125 shares of common stock upon exchange of Exchangeable Shares of 0959456 B.C.
Ltd., a British Columbia corporation, and our subsidiary.
Warrant
Exercises
During
the three-year period ended June 30, 2018, we issued 20,960 shares of common stock upon exercise of warrants at an exercise price
of $31.40.
During
the three-year period ended June 30, 2018, we issued 9,110 shares of common stock upon exercise of warrants at an exercise price
of $30.00.
During
the three-year period ended June 30, 2018, we issued 62 shares of common stock upon the cashless exercise of 103 warrants with
an exercise price of $30.00.
During
the three-year period ended June 30, 2018, we issued 12,500 shares of common stock upon exercise of warrants at an exercise price
of $15.40.
Compensatory
Issuances
During
the three-year period ended June 30, 2018, we issued 9,613 shares of common stock in relation to services received by us.
During
the three-year period ended June 30, 2018, we granted options pursuant to our 2017 Omnibus Incentive Plan to purchase 92,698 shares
of our common stock at an exercise price of $9.70 per share.
During
the three-year period ended June 30, 2018, we granted 140,000 performance stock units pursuant to our 2017 Omnibus
Incentive Plan.
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During
the three-year period ended June 30, 2018, we granted options pursuant to our Amended and Restated 2003 Employee Stock Option
Plan to purchase 230,448 shares of our common stock at an exercise price of $14.20 per share.
During
the three-year period ended June 30, 2018, we issued warrants to purchase an aggregate of 72,640 shares of our common stock at
an exercise price of $21.60 for service to be rendered by consultants to us.
Except
as indicated above, in connection with the issuance of the above unregistered securities we relied on the exemption from registration
afforded by Section 4(a)(2) and Regulation D (Rule 506) of the Securities Act of 1933, as amended, based on representations to
the Company made by the Exercising Holders that they are "accredited investors" as such term is defined under Regulation
D of the Securities Act. Until registered, the Exchange Shares are restricted and may not be offered or sold in the United States
absent registration or availability of an applicable exemption from registration.
Item
16.     Exhibits and Financial Statement Schedules.
(a)
Exhibits
The
following exhibits are being filed with this Registration Statement:
Exhibit No.
Description of Exhibit
3.1
Articles of Incorporation of the Company (incorporated by reference to Exhibit 3.1 of the Company's Registration Statement on Form S-1 filed with the SEC on August 17, 2010)
3.2
Articles of Merger of the Company (incorporated by reference to Exhibit 3.1(b) of the Company's Current Report on Form 8-K filed with the SEC on January 23, 2013)
3.3
Certificate of Designation of Special Voting Preferred Stock of the Company (incorporated by reference to Exhibit 3.1(a) of the Company's Current Report on Form 8-K filed with the SEC on January 23, 2013)
3.4
Bylaws of the Company (incorporated by reference to Exhibit 3.2 of the Company's Registration Statement on Form S-1 filed with the SEC on August 17, 2010)
3.5
Amendment to Bylaws of the Company (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on February 14, 2013)
3.6
Certificate of Designation of Series A Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on October 3, 2014)
3.7
Certificate of Amendment to Articles of Incorporation (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on January 7, 2013)
3.8
Certificate of Change (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on May 20, 2016)
3.9
Certificate of Designation of Series B Preferred Stock (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on May 5, 2016)
3.10
The Certificate of Amendment to the Articles of Incorporation, as amended, of DelMar Pharmaceuticals Inc., dated April 11, 2018 (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on April 13, 2018)
3.11
Form of Certificate of Designation of Preference, Rights and Limitations of Series C Convertible Preferred Stock (incorporated by reference to Exhibit 3.11 of the Company's Post-Effective Amendment to the Registration Statement on Form S-1 filed with the SEC on June 10, 2019)
3.12
Certificate of Correction to the Company's articles of incorporation, filed with the Secretary of State of the State of Nevada on April 17, 2019 (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on April 17, 2019)
3.13
Certificate of Change of DelMar Pharmaceuticals, Inc., dated May 7, 2019 and effective May 8, 2019 (incorporated by reference to Exhibit 3.1 of the Company's Current Report on Form 8-K filed with the SEC on May 8, 2019)
4.1
Specimen Common Stock Certificate, $.001 par value (incorporated by reference to Exhibit 4 of the Company's Registration Statement on Form 8-A filed with the SEC on September 14, 2012)
4.2
Form of Warrant (incorporated by reference to Exhibit 4.1 of the Company's Registration Statement on Form S-1/A filed with the SEC on July 9, 2015)
4.3
Form of Investor Warrant (incorporated by reference to Exhibit 10.6 of the Company's Current Report on Form 8-K filed with the SEC on January 31, 2013)
4.4
Form of Dividend Warrant (incorporated by reference to Exhibit 10.7 of the Company's Current Report on Form 8-K filed with the SEC on January 31, 2013)
4.5
Form of Election to Exercise Warrants (incorporated by reference to Exhibit 99.1 of the Company's Current Report on Form 8-K filed with the SEC on June 9, 2014)
4.6
Form of Investor Warrant Amendment (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on November 6, 2014)
4.7
Form of Dividend Warrant Amendment (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the SEC on November 6, 2014)
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4.8
Form of Placement Agent Warrant Amendment (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on December 31, 2015)
4.9
Form of Placement Agent Warrant (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed with the SEC on May 5, 2016)
4.10
Form of Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K filed with the SEC on April 13, 2017)
4.11
Form of Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.1 of the Company's Current Report on Form 8-K filed with the SEC on September 21, 2017)
4.20
Form of Warrant Agreement (incorporated by reference to Exhibit 4.21 of the Company's Registration Statement on Form S-1/A filed with the SEC on May 23, 2019)
4.21
Form of Warrant Certificate (incorporated by reference to Exhibit 4.21 of the Company's Post-Effective Amendment to the Registration Statement on Form S-1 filed with the SEC on June 10, 2019)
4.22
Form of Non-Transferable Subscription Rights Certificate (incorporated by reference to Exhibit 4.22 of the Company's Post-Effective Amendment to the Registration Statement on Form S-1 filed with the SEC on June 10, 2019)
5.1*
Legal opinion of Fennemore Craig, P.C.
10.1
Form of Placement Agent Agreement (incorporated by reference to Exhibit 1.1 of the Company's Registration Statement on Form S-1/A filed with the SEC on July 15, 2015)
10.2
Intercompany Funding Agreement, dated January 25, 2013, between the Company and Exchangeco (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on January 31, 2013)
10.3
Support Agreement, dated January 25, 2013, among the Company, Exchangeco and Callco (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the SEC on January 31, 2013)
10.4
Voting and Exchange Trust Agreement, dated January 25, 2013, among the Company, Callco, Exchangeco, and the Trustee (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed with the SEC on January 31, 2013)
10.5†
Memorandum of Understanding and Collaboration Agreement between Guangxi Wuzhou Pharmaceutical (Group) Co. Ltd. and Del Mar (BC) (incorporated by reference to Exhibit 10.8 of the Company's Current Report on Form 8-K filed with the SEC on January 31, 2013)
10.6†
Patent Assignment Agreement, dated September 12, 2010, between Del Mar (BC) and Valent (incorporated by reference to Exhibit 10.9 of the Company's Current Report on Form 8-K/A filed with the SEC on March 14, 2013)
10.7†
Amendment, dated January 21, 2013, to Patent Assignment Agreement, dated September 12, 2010, between Del Mar (BC) and Valent (incorporated by reference to Exhibit 10.10 of the Company's Current Report on Form 8-K/A filed with the SEC on March 14, 2013)
10.8
Form of Exchange Agreement (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on January 7, 2015)
10.9†
Consulting Agreement, effective January 1, 2015 between Del Mar (BC) and Jeffrey Bacha (incorporated by reference to Exhibit 10.16 of the Company's Registration Statement on Form S-1 filed with the SEC on April 10, 2015)
10.10†
Consulting Agreement, effective January 1, 2015 between Del Mar (BC) and Dennis Brown (incorporated by reference to Exhibit 10.17 of the Company's Registration Statement on Form S-1 filed with the SEC on April 10, 2015)
10.11†
Consulting Agreement, effective January 1, 2015 between Del Mar (BC) and Scott Praill (incorporated by reference to Exhibit 10.18 of the Company's Registration Statement on Form S-1 filed with the SEC on April 10, 2015)
10.12
Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on May 5, 2016)
10.13
Form of Royalty Agreement (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the SEC on May 5, 2016)
10.14
Form of Securities Purchase Agreement, dated April 12, 2017 (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on April 13, 2017)
10.15
Engagement Letter Agreement, dated January 24, 2017 between DelMar Pharmaceuticals, Inc. and H.C. Wainwright & Co., LLC (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the SEC on April 13, 2017)
10.16
Amendment No. 1 to letter agreement between DelMar Pharmaceuticals, Inc. H.C. Wainwright & Co., LLC (incorporated by reference to Exhibit 10.3 of the Company's Current Report on Form 8-K filed with the SEC on April 13, 2017)
10.17
Amendment No. 2 to letter agreement between DelMar Pharmaceuticals, Inc. H.C. Wainwright & Co., LLC (incorporated by reference to Exhibit 10.4 of the Company's Current Report on Form 8-K filed with the SEC on April 13, 2017)
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10.18†
Employment agreement among Delmar Pharmaceuticals Inc., Delmar Pharmaceuticals (BC) Ltd. and Jeffrey Bacha (incorporated by reference to Exhibit 10.1 of the Company's Quarterly Report on Form 10-Q filed with the SEC on February 10, 2017)
10.19†
Employment agreement among Delmar Pharmaceuticals Inc., Delmar Pharmaceuticals (BC) Ltd. and Scott Praill (incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q filed with the SEC on February 10, 2017)
10.20†
Amendment to consulting agreement between Delmar Pharmaceuticals (BC) Ltd. and Dennis Brown (incorporated by reference to Exhibit 10.3 of the Company's Quarterly Report on Form 10-Q filed with the SEC on February 10, 2017)
10.21†
2017 Omnibus Equity Incentive Plan (As Amended and Restated Effective as of February 1, 2018) (incorporated by reference to Exhibit 10.4 of the Company's Quarterly Report on Form 10-Q filed with the SEC on February 14, 2018)
10.22
Form of Performance Share Unit Award Agreement (incorporated by reference to Exhibit 99.2 of the Company's Current Report on Form 8-K filed with the SEC on July 12, 2017)
10.23
Engagement Letter Agreement, dated September 17, 2017 between DelMar Pharmaceuticals, Inc. and H.C. Wainwright & Co., LLC (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the SEC on September 21, 2017)
10.24
Form of Securities Purchase Agreement, dated September 20, 2017 (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on September 21, 2017)
10.25†
Settlement Agreement, dated January 1, 2018, between Delmar Pharmaceuticals, Inc. and Jeffrey Bacha (incorporated by reference to Exhibit 10.3 of the Company's Quarterly Report on Form 10-Q filed with the SEC on February 14, 2018
10.26†
Agreement, effective as of November 3, 2017 between the Company and Mr. Zarrabian (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on November 8, 2017
10.27†
Employment agreement, effective as of May 21, 2018 between the Company and Mr. Zarrabian (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on May 22, 2018, 2017
10.28
Placement Agency Agreement, dated June 3, 2019, among the Company, Maxim Group LLC and Dawson James Securities, Inc. (incorporated by reference to Exhibit 10.1 of the Company's Current Report on Form 8-K filed with the SEC on June 3, 2019)
10.29
Form of Purchase Agreement, dated as of June 3, 2019 among the Company and the purchasers thereunder (incorporated by reference to Exhibit 10.2 of the Company's Current Report on Form 8-K filed with the SEC on June 3, 2019)
21.1
Subsidiaries (incorporated by reference to Exhibit 21 of the Company's Registration Statement on Form S-1 filed with the SEC on June 14, 2013)
23.1*
Consent of Ernst & Young, LLP
23.2*
Consent of Fennemore Craig, P.C. (included in Exhibit 5.1)
24.1*
Power of Attorney (included on the signature page of this registration statement)
EX-101.INS
XBRL Instance Document*
EX-101.SCH
XBRL Taxonomy Extension Schema Document*
EX-101.CAL
XBRL Taxonomy Extension Calculation Linkbase*
EX-101.DEF
XBRL Taxonomy Extension Definition Linkbase*
EX-101.LAB
XBRL Taxonomy Extension Labels Linkbase*
EX-101.PRE
XBRL Taxonomy Extension Presentation Linkbase*
†
Indicates
management contract or compensatory plan.
*
Filed
herewith.
(b)
Financial
Statement Schedules
All
schedules have been omitted because either they are not required, are not applicable or the information is otherwise set forth
in the financial statements and related notes thereto.
Item
17.     Undertakings
(a)
The
undersigned registrant hereby undertakes:
(1)
To
file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i)
To
include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
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6
(ii)
To
reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Security and Exchange Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;
and
(iii)
To
include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement.
(2)
That,
for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3)
To
remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at
the termination of the offering.
(4)
That,
for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
(A)
Each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the
date the filed prospectus was deemed part of and included in the registration statement; and
(B)
Each
prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in
a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed
incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to
a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration
statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date
of first use.
(5)
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to any charter provision, by law or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities
Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than
payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue.
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7
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, has duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Vancouver, British Columbia, Canada, as of June 25, 2019.
DELMAR PHARMACEUTICALS, INC.
By:
/s/ Scott
    Praill
Scott Praill
Chief Financial Officer
KNOW
ALL MEN BY THESE PRESENTS
, that each person whose signature appears below constitutes and appoints Saiid Zarrabian and Scott
Praill, and each of them, each with full power to act without the other, his true and lawful attorneys-in-fact and agents,
each with full power of substitution and resubstitution, for such person and in his name, place and stead, in any and all capacities,
to sign any amendments to this registration statement, and to sign any registration statement for the same offering covered by
this registration statement, including post-effective amendments or registration statements filed pursuant to Rule 462(b)
under the Securities Act of 1933, and to file the same, with all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, hereby ratifying and confirming that each of said such attorneys-in-fact and
agents or his substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature
Title
Date
/s/
    Saiid Zarrabian
Chief Executive Officer and Director
June
    25, 2019
Saiid Zarrabian
(Principal Executive Officer)
/s/
    Scott Praill
Chief Financial Officer
June
    25, 2019
Scott Praill
(Principal Financial and Accounting Officer)
/s/
    John K. Bell
Director
June
    25, 2019
John K. Bell
/s/
    Lynda Cranston
Director
June
    25, 2019
Lynda Cranston
/s/
    Napoleone Ferrara
Director
June
    25, 2019
Napoleone Ferrara
/s/
    Robert E. Hoffman
Director
June
    25, 2019
Robert E. Hoffman
/s/
    Robert J. Toth
Director
June
    25, 2019
Robert J. Toth
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