Company: IXHL
Filing Date: 2025-09-29
Form Type: 10-K
Source: 0001213900-25-092837
Chunk: 154

Company: Incannex Healthcare Inc.
Filing Date: 2025-09-29
Form: 10-K
Item: Item 1
Chunk 154
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 For example, EU legislation does not establish different classes of narcotic or psychotropic
substances. However, the United Nations (“UN”), Single Convention on Narcotic Drugs of 1961 and the UN Convention on Psychotropic
Substances of 1971 (collectively, the “UN Conventions”) codify internationally applicable control measures to ensure the availability
of narcotic drugs and psychotropic substances for medical and scientific purposes. The individual EU member states are all signatories
to these UN Conventions. All signatories have a dual obligation to ensure that these substances are available for medical purposes and
to protect populations against abuse and dependence. The UN Conventions regulate narcotic drugs and psychotropic substances as Schedule
I, II, III, IV substances with Schedule III substances presenting the lowest relative risk of abuse among such substances and Schedule
I and IV substances considered to present the highest risk of abuse. The UN Conventions require signatories to require all people manufacturing,
trading (including exporting and importing) or distributing controlled substances to obtain a license from the relevant authority. Each
individual export or import of a controlled substance must also be subject to authorization. The obligations provided in the UN Conventions
and additional requirements are implemented at a national level, and requirements may vary from one member state to another. In order
to develop and commercialize our products in the EU, we need to comply with the national requirements related to controlled substances
which are costly and may affect our development plans in the EU.

Failure to comply with applicable legal requirements
could lead to enforcement and sanctions by the responsible regulatory authorities, which could have a material adverse effect on our business,
financial condition and results of operations

Our relationships with customers and third-party payors will
be subject to applicable anti-kickback, fraud and abuse and other healthcare laws and regulations, which could expose us to criminal sanctions,
substantial civil penalties, contractual damages, reputational harm and diminished profits and future earnings.

Although we do not currently have any products
on the market, upon commercialization of our drug candidates, if approved, we will be subject to additional healthcare statutory and regulatory
requirements and oversight by federal and state governments in the United States as well as international governments in the jurisdictions
in which we conduct our business. Physicians, other healthcare providers, and third-party payors will play a primary role in the recommendation
and prescription of any drug candidates for which we obtain marketing approval. Our future arrangements with third-party payors and customers
may expose us to broadly applicable federal