Company: IXHL
Filing Date: 2025-04-07
Form Type: 424B5
Source: 0001213900-25-029414
Chunk: 19

Company: Incannex Healthcare Inc.
Filing Date: 2025-04-07
Form: 424B5
Chunk 19
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 from resales of the common stock issued pursuant to the March 2025 Purchase
Agreements, which do not contain a prohibition against short sales between the closing of the Private Placement and the date of Stockholder
Approval, could encourage short sales of common stock by the Purchasers. Generally, short selling means selling a
security not owned by the seller. The seller is committed to eventually purchase the security previously sold. Generally, short selling
means selling a security, contract or commodity not owned by the seller. The seller is committed to eventually purchase the financial
instrument previously sold. Short sales are used to capitalize on an expected decline in the security's price. Holders of the Series
A Warrants can sell substantial amounts of common stock upon cashless exercise of the Series A Warrants following Stockholder Approval
for a total of up to 347,222,720 shares assuming full exercise pursuant to the zero strike price exercise provisions in the Series A Warrants.
Once the registration statements for the Private Placement are effective, significant amounts of such short selling could place further
downward pressure on the market price of our common stock.

We expect the stock price of our common stock to be highly volatile.

The market price of shares
of our common stock has been and is likely to continue to be subject to significant fluctuations. Market prices for securities of biotechnology
and other life sciences companies historically have been particularly volatile subject even to large daily price swings. Some of the factors
that may cause the market price of shares of our common stock to fluctuate include, but are not limited to:

| ● | our ability to obtain timely regulatory approvals for IHL-42X, PSX-001, and IHL-675A, or other drug candidates, and delays or failures 
 to obtain such approvals;                                                                                                              |

| ● | adverse results, clinical holds, or delays in the clinical trials of our drug candidates or any future clinical trials we may conduct, 
 or changes in the development status of our drug candidates;                                                                           |

| ● | failure of any of our drug candidates, if approved, to achieve commercial success; |

| ● | negative publicity or public perception of the use of cannabinoid or psychedelic substances as a medical treatment; |

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| ● | failure to maintain our existing third-party collaboration, license and supply agreements; |

| ● | failure by us or our licensors to prosecute, maintain, or enforce our intellectual property rights; |

| ● | changes in laws or regulations applicable