# EDGAR Filing Document

**Accession Number:** 0001444307
**File Stem:** 0001493152-23-007478
**Filing Date:** 2023-3
**Character Count:** 164009
**Document Hash:** f319dd9b616c1854f39d76f7984d2d6a
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001493152-23-007478.hdr.sgml**: 20230314

**ACCESSION NUMBER**: 0001493152-23-007478

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 72

**CONFORMED PERIOD OF REPORT**: 20230131

**FILED AS OF DATE**: 20230314

**DATE AS OF CHANGE**: 20230313

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** ONCOSEC MEDICAL Inc
- **CENTRAL INDEX KEY:** 0001444307
- **STANDARD INDUSTRIAL CLASSIFICATION:** PHARMACEUTICAL PREPARATIONS [2834]
- **IRS NUMBER:** 980573252
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 0731

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-54318
- **FILM NUMBER:** 23728534

**BUSINESS ADDRESS:**
- **STREET 1:** 820 BEAR TAVERN ROAD
- **CITY:** EWING
- **STATE:** NJ
- **ZIP:** 08628
- **BUSINESS PHONE:** (858) 210-7333

**MAIL ADDRESS:**
- **STREET 1:** 820 BEAR TAVERN ROAD
- **CITY:** EWING
- **STATE:** NJ
- **ZIP:** 08628

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** NetVentory Solutions, Inc.
- **DATE OF NAME CHANGE:** 20080902

?xml version="1.0" encoding="utf-8"?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 10-Q**

**☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE**

**ACT OF 1934**

**FOR THE QUARTERLY PERIOD ENDED JANUARY 31, 2023**

**OR**

**☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE**

**ACT OF 1934**

**FOR THE TRANSITION PERIOD FROM __ TO __**

**COMMISSION FILE NO. 000-54318**

**ONCOSEC MEDICAL INCORPORATED**

(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

---

| | |
|:---|:---|
| **nevada** | **98-0573252** |
| (State or other jurisdiction of | (I.R.S. Employer |
| incorporation or organization) | Identification No.) |
| **820 BEAR TAVERN ROAD** |  |
| **EWING, NJ** | **08628** |
| (Address of principal executive offices) | (Zip Code) |

---

**(855) 662-6732**

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Exchange Act:

---

| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, par value $0.0001 per share | ONCS | Nasdaq Capital Market |

---

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

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 ☐ <br> Non-accelerated filer ☒ Smaller reporting company ☒ <br> 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 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the Registrant's Common Stock, $0.0001 par value, was 2,971,246 as of March 13, 2023.

**OncoSec Medical Incorporated**

**Form 10-Q**

**for the Quarterly Period Ended January 31, 2023**

---

| | | |
|:---|:---|:---|
| [PART I—FINANCIAL INFORMATION](#bs_001) | [PART I—FINANCIAL INFORMATION](#bs_001) | 3 |
| Item 1. | [Financial Statements:](#bs_002) | 3 |
|  | [Condensed Consolidated Balance Sheets as of January 31, 2023 (unaudited) and July 31, 2022](#bs_003) | 3 |
|  | [Condensed Consolidated Statements of Operations for the three and six months ended January 31, 2023 and 2022 (unaudited)](#bs_004) | 4 |
|  | [Condensed Consolidated Statements of Comprehensive Loss for the three and six months ended January 31, 2023 and 2022 (unaudited)](#bs_005) | 5 |
|  | [Condensed Consolidated Statements of Stockholders' Equity (Deficit) for the three and six months ended January 31, 2023 and 2022 (unaudited)](#bs_006) | 6 |
|  | [Condensed Consolidated Statements of Cash Flows for the six months ended January 31, 2023 and 2022 (unaudited)](#bs_007) | 8 |
|  | [Notes to Condensed Consolidated Financial Statements (unaudited)](#bs_008) | 9 |
| Item 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations](#sj_001) | 30 |
| Item 3. | [Quantitative and Qualitative Disclosures about Market Risk](#sj_002) | 39 |
| Item 4. | [Controls and Procedures](#sj_003) | 39 |
| [PART II—OTHER INFORMATION](#sj_004) | [PART II—OTHER INFORMATION](#sj_004) | 40 |
| Item 1. | [Legal Proceedings](#sj_005) | 40 |
| Item 1A. | [Risk Factors](#sj_006) | 40 |
| Item 2. | [Unregistered Sales of Equity Securities and Use of Proceeds](#sj_007) | 41 |
| Item 3. | [Defaults Upon Senior Securities](#sj_008) | 41 |
| Item 4. | [Mine Safety Disclosures](#sj_009) | 41 |
| Item 5. | [Other Information](#sj_010) | 41 |
| Item 6. | [Exhibits](#sj_011) | 42 |
| [SIGNATURES](#sj_012) | [SIGNATURES](#sj_012) | 43 |

---

**PART I—FINANCIAL INFORMATION**

**Item 1. Financial Statements.**

**OncoSec Medical Incorporated**

**Condensed Consolidated Balance Sheets\***

---

| | | |
|:---|:---|:---|
|  | **January 31, 2023<sup>\*</sup>** | **July 31, 2022<sup>\*</sup>** |
|  | **(Unaudited)** | |
| **Assets** |  |  |
| Current assets |  |  |
| Cash and cash equivalents | $3683330 | $12299740 |
| Prepaid expenses and other current assets | 2758245 | 2932731 |
| Total Current Assets | 6441575 | 15232471 |
| Property and equipment, net | 901844 | 978614 |
| Intangible assets, net | 343588 | 378529 |
| Operating lease right-of-use assets | 621827 | 4665515 |
| Other long-term assets | 562308 | 623239 |
| Total Assets | $8871142 | $21878368 |
| **Liabilities and Stockholders' Equity (Deficit)** |  |  |
| **Liabilities** |  |  |
| Current liabilities |  |  |
| Accounts payable and accrued liabilities | $4690271 | $4208222 |
| Accrued compensation related | 1203119 | 376977 |
| Operating lease liabilities | 958118 | 1111571 |
| Note payable | 379535 | 936558 |
| Total Current Liabilities | 7231043 | 6633328 |
| Operating lease liabilities, net of current portion | 213835 | 4126636 |
| Convertible note - related party | 1912725 |  |
| Liability under co-promotion agreement - related party | 5000000 | 5000000 |
| Total Liabilities | 14357603 | 15759964 |
| **Commitments and Contingencies (Note 8)** |  |  |
| **Stockholders' Equity (Deficit)** |  |  |
| Common stock authorized – 100,000,000 and 4,545,455 common shares with a par value of $0.0001 as of January 31, 2023 and July 31, 2022, respectively, common stock issued and outstanding – 2,971,197 and 1,790,051 common shares as of January 31, 2023 and July 31, 2022, respectively | 297 | 179 |
| Additional paid-in capital | 295239501 | 291828679 |
| Accumulated other comprehensive income | 153684 | 247211 |
| Accumulated deficit | (300879943) | (285957665) |
| Total Stockholders' Equity (Deficit) | (5486461) | 6118404 |
| Total Liabilities and Stockholders' Equity (Deficit) | $8871142 | $21878368 |

---

\* On November 9, 2022, the Company effectuated a 1 for 22 reverse stock split. Share amounts have been retroactively restated.

The accompanying notes are an integral part of these condensed consolidated financial statements.

**OncoSec Medical Incorporated**

**Condensed Consolidated Statements of Operations**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **January 31, 2023** | **January 31, 2022** | **January 31, 2023** | **January 31, 2022** |
| Revenue | $- | $- | $- | $- |
| Expenses: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Research and development | 4653595 | 6825540 | 9421968 | 13471311 |
| &nbsp;&nbsp;&nbsp;General and administrative | 3009912 | 2590893 | 5548409 | 5860616 |
| Loss from operations | (7663507) | (9416433) | (14970377) | (19331927) |
| &nbsp;&nbsp;&nbsp;Other income (expense), net | (14636) | (2583) | 23463 | (4594) |
| &nbsp;&nbsp;&nbsp;Interest expense | (33551) | (5382) | (44632) | (13427) |
| &nbsp;&nbsp;&nbsp;Foreign currency exchange gain (loss), net | 853764 | (480072) | 72218 | (363147) |
| Loss before income taxes | (6857930) | (9904470) | (14919328) | (19713095) |
| &nbsp;&nbsp;&nbsp;Income tax expense | 2950 | 2950 | 2950 | 2950 |
| Net loss | $(6860880) | $(9907420) | $(14922278) | $(19716045) |
| Basic and diluted net loss per common share | $(2.65) | $(5.54) | $(6.82) | $(11.05) |
| Weighted average shares used in computing basic and diluted net loss per common share | 2587341 | 1787039 | 2188821 | 1783913 |

---

\* On November 9, 2022, the Company effectuated a 1 for 22 reverse stock split. Share amounts have been retroactively restated.

The accompanying notes are an integral part of these condensed consolidated financial statements.

**OncoSec Medical Incorporated**

**Condensed Consolidated Statements of Comprehensive Loss**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Six Months Ended** | **Six Months Ended** |
|  | **January 31, 2023** | **January 31, 2022** | **January 31, 2023** | **January 31, 2022** |
| Net Loss | $(6860880) | $(9907420) | $(14922278) | $(19716045) |
| Foreign currency translation adjustments | (745222) | 383376 | (93527) | 252983 |
| Comprehensive Loss | $(7606102) | $(9524044) | $(15015805) | $(19463062) |

---

The accompanying notes are an integral part of these condensed consolidated financial statements.

**OncoSec Medical Incorporated**

**Condensed Consolidated Statements of Stockholders' Equity (Deficit)**

**(Unaudited)**

**<u>Three Months Ended January 31, 2023\*</u>**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | | | | |
|  | **Shares** | **Amount** | **Additional Paid-In**<br>**Capital** | **Accumulated**<br> **Other**<br>**Comprehensive**<br>**Income** | **Accumulated**<br>**Deficit** | **Total**<br> **Stockholders'**<br> **Equity**<br>**(Deficit)** |
| Balance, October 31, 2022 | 1790741 | $179 | $292135529 | $898906 | $(294019063) | $(984449) |
| Stock-based compensation expense | 689 |  | 284216 |  |  | 284216 |
| Tax withholdings paid on equity awards |  |  | (490) |  |  | (490) |
| Tax shares sold to pay for tax withholdings on equity awards |  |  | 465 |  |  | 465 |
| December 2022 Public Offering, net of $680,181 issuance costs | 250000 | 25 | 2819703 |  |  | 2819728 |
| Exercise of pre-funded warrants | 916667 | 92 |  |  |  | 92 |
| Reverse split fractional shares | 13058 | 1 | (1) |  |  |  |
| Common stock issued for employee stock purchase plan | 42 |  | 79 |  |  | 79 |
| Other comprehensive income/(loss) |  |  |  | (745222) |  | (745222) |
| Net loss |  |  |  |  | (6860880) | (6860880) |
| Balance, January 31, 2023 | 2971197 | $297 | $295239501 | $153684 | $(300879943) | $(5486461) |

---

**<u>Six Months Ended January 31, 2023\*</u>**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | | | | |
|  | **Shares** | **Amount** | **Additional Paid-In**<br>**Capital** | **Accumulated** <br> **Other**<br> **Comprehensive**<br>**Income** | **Accumulated**<br>**Deficit** | **Total**<br> **Stockholders'**<br> **Equity** <br>**(Deficit)** |
| Balance, July 31, 2022 | 1790051 | $179 | $291828679 | $247211 | $(285957665) | $6118404 |
| Stock-based compensation expense | 1379 |  | 591246 |  |  | 591246 |
| Tax withholdings paid on equity awards |  |  | (3136) |  |  | (3136) |
| Tax shares sold to pay for tax withholdings on equity awards |  |  | 2931 |  |  | 2931 |
| December 2022 Public Offering, net of $680,181 issuance costs | 250000 | 25 | 2819703 |  |  | 2819728 |
| Exercise of pre-funded warrants | 916667 | 92 |  |  |  | 92 |
| Reverse split fractional shares | 13058 | 1 | (1) |  |  |  |
| Common stock issued for employee stock purchase plan | 42 |  | 79 |  |  | 79 |
| Other comprehensive income (loss) |  |  |  | (93527) |  | (93527) |
| Net loss |  |  |  |  | (14922278) | (14922278) |
| Balance, January 31, 2023 | 2971197 | $297 | $295239501 | $153684 | $(300879943) | $(5486461) |

---

\* On November 9, 2022, the Company effectuated a 1 for 22 reverse stock split. Share amounts have been retroactively restated.

The accompanying notes are an integral part of these condensed consolidated financial statements.

**<u>Three Months Ended January 31, 2022\*</u>**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | | | | |
|  | **Shares** | **Amount** | **Additional<br>Paid-In**<br>**Capital** | **AccumulatedOther<br>Comprehensive**<br>**Income** | **Accumulated**<br>**Deficit** | **Total<br>Stockholders'**<br>**Equity** |
| Balance, October 31, 2021 | 1781936 | $178 | $290574674 | $(209502) | $(261586656) | $28778694 |
| Stock-based compensation expense | 690 |  | 356667 |  |  | 356667 |
| Tax withholdings paid on equity awards |  |  | (4886) |  |  | (4886) |
| Tax shares sold to pay for tax withholdings on equity awards |  |  | 4762 |  |  | 4762 |
| Exercise of common stock options | 5909 | 1 | 202799 |  |  | 202800 |
| Common stock issued for employee stock purchase plan | 68 |  | 1185 |  |  | 1185 |
| Other comprehensive income (loss) |  |  |  | 383376 |  | 383376 |
| Net loss |  |  |  |  | (9907420) | (9907420) |
| Balance, January 31, 2022 | 1788603 | $179 | $291135201 | $173874 | $(271494076) | $19815178 |

---

**<u>Six Months Ended January 31, 2022\*</u>**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Common Stock** | **Common Stock** | | | | |
|  | **Shares** | **Amount** | **Additional**<br>**Paid-In**<br>**Capital** | **Accumulated Other**<br>**Comprehensive**<br>**Income** |<br>**Accumulated**<br>**Deficit** | **Total**<br>**Stockholders'**<br>**Equity** |
| Balance, July 31, 2021 | 1779664 | $178 | $289932763 | $(79109) | $(251778031) | $38075801 |
| Stock-based compensation expense | 2394 |  | 956574 |  |  | 956574 |
| Tax withholdings paid on equity awards |  |  | (33005) |  |  | (33005) |
| Tax shares sold to pay for tax withholdings on equity awards |  |  | 32385 |  |  | 32385 |
| Common stock issued for services | 568 |  | 42500 |  |  | 42500 |
| Exercise of common stock options | 5909 | 1 | 202799 |  |  | 202800 |
| Common stock issued for employee stock purchase plan | 68 |  | 1185 |  |  | 1185 |
| Other comprehensive income (loss) |  |  |  | 252983 |  | 252983 |
| Net loss |  |  |  |  | (19716045) | (19716045) |
| Balance, January 31, 2022 | 1788603 | $179 | $291135201 | $173874 | $(271494076) | $19815178 |

---

\* On November 9, 2022, the Company effectuated a 1 for 22 reverse stock split. Share amounts have been retroactively restated.

The accompanying notes are an integral part of these condensed consolidated financial statements.

**OncoSec Medical Incorporated**

**Condensed Consolidated Statements of Cash Flows**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **Six Months Ended** | **Six Months Ended** |
|  | **January 31, 2023** | **January 31, 2022** |
| *Operating activities* |  |  |
| Net loss | $(14922278) | $(19716045) |
| Adjustments to reconcile net loss to net cash used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization | 124840 | 129959 |
| &nbsp;&nbsp;&nbsp;Amortization of right-of-use asset | 199534 | 325316 |
| &nbsp;&nbsp;&nbsp;Stock-based compensation | 591246 | 956574 |
| &nbsp;&nbsp;&nbsp;Common stock issued for services |  | 42500 |
| &nbsp;&nbsp;&nbsp;Foreign currency exchange (gain) loss, net | (72218) | 363147 |
| &nbsp;&nbsp;&nbsp;Gain on sale of property and equipment | (1674) |  |
| &nbsp;&nbsp;&nbsp;Amortization of issuance costs of convertible note - related party | 9450 |  |
| &nbsp;&nbsp;&nbsp;Deferred offering costs written off | 39794 |  |
| Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;Prepaid expenses and other current assets | 221429 | 508205 |
| &nbsp;&nbsp;&nbsp;Other long-term assets | 62218 | (290876) |
| &nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | 389296 | (2118642) |
| &nbsp;&nbsp;&nbsp;Accrued compensation related | 826142 | 262186 |
| &nbsp;&nbsp;&nbsp;Operating lease liabilities | (222100) | (343817) |
| &nbsp;&nbsp;&nbsp;Other long-term liabilities | 16667 |  |
| Net cash used in operating activities | (12737654) | (19881493) |
| *Investing activities* |  |  |
| &nbsp;&nbsp;&nbsp;Purchase of property and equipment | (15955) | (244857) |
| &nbsp;&nbsp;&nbsp;Proceeds from sale of property and equipment | 4500 |  |
| Net cash used in investing activities | (11455) | (244857) |
| *Financing activities* |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of common stock through ESPP | 79 | 1185 |
| &nbsp;&nbsp;&nbsp;Payment of debt issuance costs | (113391) |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of convertible note – related party | 2000000 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from issuance of common stock and/or warrants | 3499909 |  |
| &nbsp;&nbsp;&nbsp;Payment of financing and offering costs | (673702) | (15500) |
| &nbsp;&nbsp;&nbsp;Proceeds from exercise of pre-funded warrants | 92 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from exercise of stock options |  | 202800 |
| &nbsp;&nbsp;&nbsp;Principal payments on note payable | (557023) | (736910) |
| &nbsp;&nbsp;&nbsp;Tax withholdings paid on equity awards | (3136) | (33005) |
| &nbsp;&nbsp;&nbsp;Tax shares sold to pay for tax withholdings on equity awards | 2931 | 32385 |
| &nbsp;&nbsp;&nbsp;Net cash provided by (used in) financing activities | 4155759 | (549045) |
| Effect of exchange rate changes on cash and cash equivalents | (23060) | (44845) |
| Net decrease in cash and cash equivalents | (8616410) | (20720240) |
| Cash and cash equivalents, at beginning of period | 12299740 | 45951233 |
| Cash and cash equivalents, at end of period | $3683330 | $25230993 |
| Supplemental disclosure for cash flow information: |  |  |
| Cash paid during the period for: |  |  |
| &nbsp;&nbsp;&nbsp;Interest | $18516 | $13427 |
| &nbsp;&nbsp;&nbsp;Income taxes | $2950 | $2950 |
| Noncash investing and financing transactions: |  |  |
| &nbsp;&nbsp;&nbsp;Decrease in right-of-use assets and operating lease liabilities resulting from contract modification | $3844154 | $— |
| &nbsp;&nbsp;&nbsp;Amounts accrued for offering costs | $86494 | $— |

---

The accompanying notes are an integral part of these condensed consolidated financial statements.

**OncoSec Medical Incorporated**

**Notes to Condensed Consolidated Financial Statements**

**(Unaudited)**

**Note 1—Nature of Operations and Basis of Presentation**

OncoSec Medical Incorporated (together with its subsidiary, unless the context indicates otherwise, being collectively referred to as the "Company") began its operations as a biotechnology company in March 2011. The Company has not generated any revenues since its inception. The Company was incorporated in the State of Nevada on February 8, 2008 under the name of Netventory Solutions, Inc. and changed its name to OncoSec Medical Incorporated in March 2011 when it began operating as a biotechnology company.

The Company is a late-stage immuno-oncology company focused on designing, developing and commercializing innovative, proprietary, intra-tumoral DNA-based therapeutics delivered by electroporation ("EP") to stimulate and augment anti-tumor immune responses for the treatment of cancers. Its core technology, ImmunoPulse®, is a drug-device therapeutic modality platform comprised of a proprietary OncoSec Medical System EP device (the "OMS EP Device") and a proprietary DNA plasmid delivery and application method that enables transient expression of recombinant therapeutic molecules in cells. The OMS EP Device is designed to promote cellular uptake of plasmid DNA injected directly into solid tumors to allow subsequent expression of the encoded therapeutic protein. The OMS EP Device can be adapted to treat different tumor types, and consists of an electrical pulse generator and a disposable applicator. The Company's lead product candidate, called tavokinogene telseplasmid ("TAVO™"), is a plasmid encoding human interleukin-12 ("IL-12"). The OMS EP Device is used to deliver TAVO™ into cells in tumor lesions, with the aim of overcoming the immunosuppressive microenvironment in the treated tumor and elicit systemic tumor-specific immune responses in cancer patients, which process we refer to as TAVO™-EP. Activation of an appropriate anti-tumor inflammatory response in the treated lesion can drive the immune system to mount a systemic anti-tumor response against tumors in other parts of the body that were not treated directly with the therapeutic approach. In 2017, the Company received Fast Track Designation and Orphan Drug Designation from the U.S. Food and Drug Administration ("FDA") for TAVO™ in metastatic melanoma, which could qualify TAVO™-EP for expedited FDA review, a rolling Biologics License Application ("BLA") review and certain other benefits to achieve faster registration of a therapeutic product.

The Company's primary focus is to pursue TAVO™-EP in combination with KEYTRUDA® (pembrolizumab) in melanoma. In October 2022, due to its financial position, the Company decreased all clinical activity outside of its melanoma clinical pipeline, including trials and studies involving triple negative breast cancer ("TNBC") and squamous cell carcinoma of the head and neck.

The Company's KEYNOTE-695 clinical trial is a registration-directed, Phase 2b open-label, non-randomized, multicenter trial in approximately 100 patients treated with TAVO™-EP in combination with KEYTRUDA® in anti-PD-1 checkpoint inhibitor (nivolumab or pembrolizumab) relapsed or refractory metastatic melanoma. The KEYNOTE-695 clinical trial is being conducted in the United States, Canada, Australia and Europe. In May 2017, the Company entered into a clinical trial collaboration and supply agreement with a subsidiary of Merck & Co., Inc. ("Merck") in connection with the KEYNOTE-695 trial. Pursuant to the terms of the agreement, each company will bear its own costs related to manufacturing and supply of its product, as well as its own internal costs. The Company is the trial sponsor and is responsible for external costs. The trial completed enrollment of Cohort 1 in December 2020. In December 2020, the protocol was amended to include an additional cohort, consisting of patients who were exposed to prior treatment with ipilimumab and progressed on anti-PD-1 checkpoint inhibitor therapy. The amendment also enabled enrollment of approximately 25 additional patients to be treated with an updated version of the OMS EP Device (i.e., GenPulse™ generator and Series 3 Applicator). Enrollment in these additional two cohorts has also been stopped in order to prepare for the final data analyses of the trial. Database lock for the 105 patients enrolled in Cohort 1 occurred in October 2022. The final data analysis of the key secondary endpoints, including objective response rate (ORR) by investigator assessment, was announced in November 2022, and the final data analysis of the primary endpoint, ORR by blinded independent central review (BICR) is expected to be available during the first calendar quarter of 2023.

The Company's KEYNOTE-890 clinical trial is a Phase 2, open-label, non-randomized, multicenter trial conducted in the United States and Australia to evaluate the safety and efficacy of TAVO™-EP in combination with KEYTRUDA® in patients with inoperable locally advanced or metastatic TNBC who have previously failed at least one systemic chemotherapy or immunotherapy (Cohort 1) or TAVO™-EP in combination with KEYTRUDA® and chemotherapy in patients with inoperable locally advanced or metastatic TNBC who have had no prior systemic therapy in the advanced or metastatic setting (Cohort 2).

In May 2018, the Company entered into a second clinical trial collaboration and supply agreement with Merck with respect to the KEYNOTE-890 trial, Cohort 1. Pursuant to the terms of the agreement, each company will bear its own costs related to manufacturing and supply of its product, as well as its own internal costs. The Company is the trial sponsor and is responsible for external costs. In June 2020, the Company amended this second clinical trial collaboration and supply agreement with Merck to include KEYNOTE-890, Cohort 2, for the frontline treatment of patients with inoperable locally advanced or metastatic TNBC with the combination of TAVO™-EP, KEYTRUDA®, and chemotherapy. Enrollment of Cohort 1 (26 patients) was completed in December 2020. Interim data for Cohort 1 was initially presented at the San Antonio Breast Cancer Symposium ("SABCS") in December 2019, and an update on this cohort was presented at the SABCS in December 2021. Enrollment of Cohort 2 (target 40 patients) began in January 2021. Enrollment of Cohort 2 has been closed as of October 2022; the Company has deferred further development of TAVO™-EP for the treatment of TNBC in order to focus its efforts and resources on the ongoing development of TAVO™-EP in melanoma.

In August 2020, the Company supported commencement of an investigator-sponsored Phase 2 clinical trial (Phase 2 IST) conducted by the H. Lee Moffitt Cancer Center and Research Institute and the University of South Florida Morsani College of Medicine to evaluate TAVO™-EP as neoadjuvant treatment (administered before surgery) in combination with intravenous OPDIVO® (nivolumab) in up to 33 patients with operable locally/regionally advanced melanoma. This trial has been designed to evaluate whether the addition of TAVO™-EP can increase the complete pathological response rate observed with monotherapy OPDIVO®, an anti-PD-1 checkpoint inhibitor, in patients with locally/regionally advanced melanoma prior to surgical resection of tumors. This Phase 2 IST began enrolling patients in December 2020. Enrollment for this trial is expected to be completed in calendar year 2023. Preliminary data from this trial was presented at an international medical conference, the Society for Immunotherapy of Cancer (SITC), in November 2022.

In November 2020, the Company obtained an exclusive license to the Cliniporator® electroporation gene electrotransfer platform from IGEA Clinical Biophysics. This platform has been used for electrochemotherapy in and outside of Europe in over 200 major oncological centers to treat cutaneous metastatic cancer nodules, including melanoma. The license encompasses a broad field of use for gene delivery in oncology, including use as part of the Company's Visceral Lesion applicator ("VLA") program. The Company may continue to pursue potential new trials and studies related to TAVO™-EP in various tumor types once the Company's financial resources allow.

The VLA is intended and may be designed to work with low voltage EP generators, including but not limited to the Company's proprietary APOLLO™ EP generator and Cliniporator®, and it is expected to enable transfection of immunologically relevant genes into cells located in visceral primary or metastatic tumor lesions. For example, the Company may develop this proprietary technology to treat liver, lung, bladder, pancreatic and other difficult to treat visceral lesions. In early 2020, the Company presented early preclinical data pertaining to visceral delivery of plasmid-based therapeutics at meeting of the Society for Interventional Oncology and the Society for Interventional Radiology, and the Company has since successfully completed several animal studies to assess the VLA. The Company has deferred further development of the VLA in order to focus its efforts and resources on the ongoing development of TAVO™-EP in melanoma.

*Restructuring Plan*

 

On October 2, 2022, the Company's Board of Directors authorized a restructuring plan (the "Restructuring Plan") that is designed to prioritize clinical activities in melanoma to reduce operating expenses while advancing the Company's lead product candidate, TAVO™-EP, toward near-term data milestones in connection with the KEYNOTE-695 clinical trial. As part of the Restructuring Plan, the Company restructured its internal operations and reduced its workforce by approximately 45%, or 17 employees.

The Company incurred charges of approximately $650,000 through January 31, 2023, in connection with the Restructuring Plan, consisting primarily of expenditures for employee transition, notice period and severance payments, retention bonus payments, and related costs. The Company currently estimates that it will incur additional charges of approximately $200,000 during the remainder of the first calendar quarter of 2023 in connection with the Restructuring Plan, consisting primarily of cash expenditures for retention bonus payments and related costs.

Any further charges that the Company expects to incur in connection with the Restructuring Plan are estimates and subject to a number of assumptions, and actual results may differ materially. The Company expects to operationalize additional cost reduction actions that will include other incremental cost reduction actions unrelated to workforce reductions.

Additionally, in connection with the Restructuring Plan, on December 26, 2022, the Company's Board of Directors approved cash bonus retention awards for certain members of the Company's leadership team, pursuant to which the Company will provide a cash incentive designed to retain such employees (the "Retention Bonuses"). Pursuant to the terms of the Retention Bonuses, eligible employees will each receive a cash bonus award of $50,000 (not to exceed $300,000 in the aggregate for all recipients of the Retention Bonuses), to be paid on or about August 4, 2023, for services rendered to the Company during the period beginning on October 7, 2022 and ending on July 31, 2023, subject to each eligible employee's continued employment and good standing with the Company on July 31, 2023. The Company's President and Chief Executive Officer and the Company's Chief Financial Officer will not receive Retention Bonuses.

*Unaudited Interim Financial Information*

The accompanying unaudited condensed consolidated financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and with instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete financial statements. The condensed consolidated balance sheet as of January 31, 2023, the condensed consolidated statements of operations for the three and six months ended January 31, 2023 and 2022, the condensed consolidated statements of comprehensive loss for the three and six months ended January 31, 2023 and 2022, the condensed consolidated statements of stockholders' equity (deficit) for the three and six months ended January 31, 2023 and 2022, and the condensed consolidated statements of cash flows for the six months ended January 31, 2023 and 2022, are unaudited, but include all adjustments (consisting of normal recurring adjustments) that, in the opinion of management, are necessary for a fair presentation of the Company's financial position, results of operations and cash flows for the periods presented and necessary in order to make the Company's financial statements not misleading. The condensed consolidated results of operations for the three and six months ended January 31, 2023 shown herein are not necessarily indicative of the consolidated results that may be expected for the year ending July 31, 2023, or for any other period. These condensed consolidated financial statements, and notes thereto, should be read in conjunction with the audited consolidated financial statements for the fiscal year ended July 31, 2022, included in the Company's Annual Report on Form 10-K (the "Annual Report") filed with the U.S. Securities and Exchange Commission ("SEC") on October 31, 2022. The condensed consolidated balance sheet at July 31, 2022 has been derived from the audited financial statements at that date but does not include all the information and footnotes required by U.S. GAAP for complete financial statements.

**Note 2—Significant Accounting Policies**

*Reverse Stock Split*

 

The Board of Directors of the Company approved a reverse stock split of the Company's authorized, issued and outstanding shares of common stock at a ratio of 1-for-22 (the "Reverse Stock Split"). The Reverse Stock Split became effective on November 9, 2022 (the "Effective Date"). All share and per share amounts for all periods presented in the accompanying condensed consolidated financial statements and notes thereto have been adjusted, on a retrospective basis, to reflect the Reverse Stock Split, unless otherwise stated. The number of authorized shares were also proportionately adjusted and the par value remained unaffected.

*Principles of Consolidation*

The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, OncoSec Medical Australia PTY LTD. All significant intercompany accounts and transactions have been eliminated in consolidation.

*Reclassifications*

Certain prior year amounts in the condensed consolidated financial statements and the notes thereto have been reclassified where necessary to conform to the current year presentation. These reclassifications did not affect the prior period total assets, total liabilities, stockholders' equity (deficit), net loss or net cash used in operating activities.

*Use of Estimates*

The accompanying condensed consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant accounting estimates related to the Company's ability to continue as a going concern and certain calculations related to that determination. The Company bases its estimates on historical experience and on various other assumptions that it believes are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. On an ongoing basis, the Company reviews its estimates to ensure that they appropriately reflect changes in the business or as new information becomes available. Actual results may differ from these estimates.

*Segment Reporting*

The Company operates in a single industry segment—the discovery and development of novel immunotherapeutic product candidates to improve treatment options for patients and physicians, intended to treat a wide range of oncology indications.

*Cash and Cash Equivalents*

The Company considers all highly liquid investments that are readily convertible into cash and have an original maturity of three months or less at the time of purchase to be cash equivalents.

*Concentrations and Credit Risk*

The Company maintains cash balances at a small number of financial institutions in both the United States and Australia and such balances commonly exceed the $250,000 amount insured by the Federal Deposit Insurance Corporation and $250,000 AUD (approximately $177,000 USD) insured by the Australian Financial Claims Scheme. The Company has not experienced any losses in such accounts and Management believes that the Company does not have significant credit risk with respect to such cash and cash equivalents.

*Property and Equipment*

The Company's capitalization threshold is $5,000 for property and equipment. The cost of property and equipment is depreciated on a straight-line basis over the estimated useful lives of the related assets. The useful lives of property and equipment for the purpose of computing depreciation are as follows:

---

| | |
|:---|:---|
| Computers and equipment: | 3 to 10 years |
| Computer software: | 1 to 3 years |
| Office furniture: | 3 to 5 years |
| Leasehold improvements: | Shorter of lease period or useful life |

---

Construction-in-progress is stated at cost, which relates to the cost of equipment not yet placed into service. No depreciation expense is recorded on construction-in-progress until such time as the relevant assets are completed and put into use.

*Intangible Assets*

Definite life intangible assets include a license. Intangible assets are recorded at cost. License agreement cost represents the fair value of the license agreement on the date acquired. Intangible assets are amortized on a straight-line basis over their estimated useful life.

*Impairment of Long-Lived Assets*

The Company periodically assesses the carrying value of intangible and other long-lived assets, and whenever events or changes in circumstances indicate that the carrying amount of an asset might not be recoverable. The assets are considered to be impaired if the Company determines that the carrying value may not be recoverable based upon its assessment, which includes consideration of the following events or changes in circumstances:

● the asset's ability to continue to generate income from operations and positive cash flow in future periods;

● loss of legal ownership or title to the asset(s);

● significant changes in the Company's strategic business objectives and utilization of the asset(s); and

● the impact of significant negative industry or economic trends.

If the assets are considered to be impaired, the impairment recognized is the amount by which the carrying value of the assets exceeds the fair value of the assets. Fair value is determined by the application of discounted cash flow models to project cash flows from the assets. In addition, the Company bases estimates of the useful lives and related amortization or depreciation expense on its subjective estimate of the period the assets will generate revenue or otherwise be used by it. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less selling costs. The Company also periodically reviews the lives assigned to long-lived assets to ensure that the initial estimates do not exceed any revised estimated periods from which the Company expects to realize cash flows from its assets.

*Research and Development Expenses*

Research and development expenses consist of costs incurred for internal projects, as well as partner-funded collaborative research and development activities. These costs include direct and research-related overhead expenses, which include salaries, stock-based compensation and other personnel-related expenses, facility costs, supplies, depreciation of facilities and laboratory equipment, as well as research consultants and the cost of funding research at universities and other research institutions, and are expensed as incurred. Costs to acquire technologies that are utilized in research and development that have no alternative future use, are expensed when incurred. In accordance with Accounting Standards Codification ("ASC") 730-20, the Company accounts for upfront, non-refundable research and development payments received from a related party as a long-term liability as there has not been a substantive and genuine transfer of risk and there is a presumption that the Company is obligated to repay the related party.

 

*Accruals for Research and Development Expenses and Clinical Trials*

The Company is required to estimate its expenses resulting from its obligations under contracts with vendors, clinical research organizations and consultants and under clinical site agreements in connection with conducting clinical trials. The financial terms of these contracts vary from contract to contract and may result in payment terms that do not match the periods over which materials or services are provided under such contracts. The Company accounts for these expenses in its financial statements by matching those expenses with the period in which services are performed and efforts are expended. The Company determines accrual estimates through financial models and takes into account discussion with applicable personnel and outside service providers as to the progress of clinical trials, or the services completed. The Company makes estimates of its accrued expenses as of each balance sheet date based on the facts and circumstances known to it at that time. The Company's clinical trial accruals are dependent upon the timely and accurate reporting of contract research organizations and other third-party vendors. During the course of a clinical trial, the Company adjusts its clinical expense recognition if actual results differ from its estimates.

*Fair Value of Financial Instruments*

The carrying amounts for cash and cash equivalents, prepaid expenses, accounts payable and accrued expenses and notes payable approximate fair value due to the short-term nature of these instruments. It is Management's opinion that the Company is not exposed to significant interest, currency, or credit risks arising from its other financial instruments and that their fair values approximate their carrying values except where expressly disclosed.

The accounting standard for fair value measurements provides a framework for measuring fair value and requires disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, based on the Company's principal or, in the absence of a principal, most advantageous market for the specific asset or liability.

The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs, when determining fair value.

The three tiers are defined as follows:

● Level
 1—Observable inputs that reflect quoted market prices (unadjusted) for identical assets or liabilities in active markets at
 the measurement date. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation
 of these products does not entail a significant degree of judgment.

● Level
 2—Observable inputs other than quoted prices in active markets that are observable either directly or indirectly in the marketplace
 for identical or similar assets and liabilities.

● Level
 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The development and determination of the unobservable inputs for Level 3 fair value measurements and fair value calculations are the responsibility of the Company's Management.

Changes in fair value measurements categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate.

The Company had no assets or liabilities that required remeasurement on a recurring basis as of January 31, 2023 and July 31, 2022.

 

*Warrants*

The Company assesses its warrants as either equity or a liability based upon the characteristics and provisions of each instrument. Warrants classified as equity are recorded at fair value as of the date of issuance on the Company's balance sheet and no further adjustments to their valuation are made. Warrants classified as derivative liabilities and other derivative financial instruments that require separate accounting as liabilities are recorded on the Company's balance sheet at their fair value on the date of issuance and are re-measured on each subsequent balance sheet date until such instruments are exercised or expire, with any changes in the fair value between reporting periods recorded as other income or expense. Management estimates the fair value of these liabilities using option pricing models and assumptions that are based on the individual characteristics of the warrants or other instruments on the valuation date, as well as assumptions for future financings, expected volatility, expected life, yield and risk-free interest rate. As of January 31, 2023 and July 31, 2022, all outstanding warrants issued by the Company were classified as equity.

 

 

*Net Loss Per Share*

The Company computes basic net loss per common share by dividing the applicable net loss by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing the applicable net loss by the weighted-average number of common shares outstanding during the period plus additional shares to account for the dilutive effect of potential future issuances of common stock relating to stock options and other potentially dilutive securities using the treasury stock method.

The Company did not include shares underlying stock options, restricted stock units and warrants issued and outstanding during any of the periods presented in the computation of net loss per share, as the effect would have been anti-dilutive. The following potentially dilutive outstanding securities were excluded from diluted net loss per share because of their anti-dilutive effect:

---

| | | |
|:---|:---|:---|
|  | **For the Three**<br> **and Six Months** <br> **Ended**<br>**January 31, 2023** | **For the Three**<br> **and Six Months**<br> **Ended**<br>**January 31, 2022** |
| Stock options | 118979 | 110794 |
| Restricted stock units | 49 | 4008 |
| Warrants | 1242564 | 77554 |
| Convertible note – related party | 360589 | - |
| Total | 1722181 | 192356 |

---

*Stock-Based Compensation*

The Company grants equity-based awards (typically stock options or restricted stock units) under its stock-based compensation plan and occasionally outside of its stock-based compensation plan, with terms generally similar to the terms under the Company's stock-based compensation plan. The Company estimates the fair value of stock option awards using the Black-Scholes option valuation model. For employees, directors and consultants, the fair value of the award is measured on the grant date. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. The Black-Scholes option valuation model requires the input of subjective assumptions, including price volatility of the underlying stock, risk-free interest rate, dividend yield, and expected life of the option. The Company estimates the fair value of restricted stock unit awards based on the closing price of the Company's common stock on the date of grant.

*Employee Stock Purchase Plan*

Employees may elect to participate in the Company's stockholder-approved employee stock purchase plan. The stock purchase plan allows for the purchase of the Company's common stock at not less than 85% of the lesser of (i) the fair market value of a share of common stock on the beginning date of the offering period and (ii) the fair market value of a share of common stock on the purchase date of the offering period, subject to a share and dollar limit as defined in the plan and subject to the applicable legal requirements. There are two six-month offering periods during each fiscal year, ending on January 31 and July 31.

In accordance with applicable accounting guidance, the fair value of awards under the stock purchase plan is calculated at the beginning of each offering period. The Company estimates the fair value of the awards using the Black-Scholes option valuation model. The Black-Scholes option valuation model requires the input of subjective assumptions, including price volatility of the underlying stock, risk-free interest rate, dividend yield, and the offering period. This fair value is then amortized at the beginning of the offering period. Stock-based compensation expense is based on awards expected to be purchased at the beginning of the offering period, and therefore is reduced when participants withdraw during the offering period.

 

*Leases*

The Company determines if an arrangement is a lease at inception. Operating lease right of use ("ROU") assets represent the Company's right to use an underlying asset during the lease term, and operating lease liabilities represent the Company's obligation to make lease payments arising from the lease. Operating leases are included in ROU assets, current operating lease liabilities, and long-term operating lease liabilities on the Company's condensed consolidated balance sheets.

Lease ROU assets and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using the Company's incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. ROU assets also include any lease payments made at or before lease commencement and exclude any lease incentives received. The Company's lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Leases with a term of 12 months or less are not recognized on the condensed consolidated balance sheets. The Company's leases do not contain any residual value guarantees. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. The Company accounts for lease and non-lease components as a single lease component for all its leases.

*Foreign Currency Translation*

The Company uses the U.S. Dollar as the reporting currency for its financial statements. Functional currency is the currency of the primary economic environment in which an entity operates. The functional currency of the Company's wholly owned subsidiary is the Australian dollar.

Assets and liabilities of the Company's subsidiary are translated into U.S. Dollars at period-end foreign exchange rates, and revenues and expenses are translated at average rates prevailing throughout the period. Translation adjustments are included in "Accumulated other comprehensive income" as a separate component of stockholders' equity, and in the "Effect of exchange rate changes on cash and cash equivalents," on the Company's condensed consolidated statements of cash flows. Transaction gains and losses including intercompany transactions denominated in a currency other than the functional currency of the entity involved are included in "Foreign currency exchange gain (loss), net" on the Company's condensed consolidated statements of operations.

*Accumulated Other Comprehensive Income (Loss)*

Accumulated other comprehensive income (loss) includes foreign currency translation adjustments related to the Company's subsidiary in Australia and is excluded from the accompanying condensed consolidated statements of operations.

*Australia Research and Development Tax Credit*

The Company's wholly-owned Australian subsidiary incurs research and development expenses, primarily in the course of conducting clinical trials. The Company's Australian research and development activities qualify for the Australian government's tax credit program, which provides a 48.5% credit for qualifying research and development expenses. The tax credit does not depend on the Company's generation of future taxable income or ongoing tax status or position. Accordingly, the credit is not considered an element of income tax accounting under ASC 740 "Income Taxes" and is recorded against qualifying research and development expenses.

 

*Recent Accounting Pronouncements*

In August 2020, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40)-Accounting For Convertible Instruments and Contracts in an Entity's Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for it. The ASU also simplifies the diluted net income per share calculation in certain areas. The new guidance is effective for annual and interim periods beginning after December 15, 2021, and early adoption is permitted for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. The Company adopted ASU 2020-06 on August 1, 2022, and the adoption of ASU 2020-06 did not have an impact on our condensed consolidated financial statements and disclosures.

No other recent accounting pronouncements are anticipated to have an impact on or related to the Company's financial condition, results of operations, or related disclosures.

**Note 3—Going Concern and Management's Plans**

The Company has sustained losses in all reporting periods since inception, with an accumulated deficit of approximately $301 million as of January 31, 2023. These losses are expected to continue for an extended period of time. Further, the Company has never generated any cash from its operations and does not expect to generate such cash in the near term. The aforementioned factors raise substantial doubt about the Company's ability to continue as a going concern within one year from the issuance date of the condensed consolidated financial statements. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a going concern within one year after the date the condensed consolidated financial statements are issued.

As of March 6, 2023, the Company had cash and cash equivalents of $2.0 million. Since inception, cash flows from financing activities have been the primary source of the Company's liquidity. Based on the Company's current cash levels, the Company believes its cash resources are insufficient to meet the Company's anticipated needs for the 12 months following the date the condensed consolidated financial statements are issued.

The Company recognizes it will need to raise additional capital to continue operating its business and fund its planned operations, including research and development, clinical trials and, if regulatory approval is obtained, commercialization of its product candidates. In addition, the Company will require additional financing if it desires to in-license or acquire new assets, research and develop new compounds or new technologies and pursue related patent protection, or obtain any other intellectual property rights or other assets. There is no assurance that additional financing will be available to the Company when needed, that Management will be able to obtain financing on terms acceptable to the Company, or whether the Company will become profitable and generate positive operating cash flow. The source, timing and availability of any future financing will depend principally upon market conditions, and, more specifically, on the progress of our clinical development programs. Similarly, if our common stock is delisted from the Nasdaq Capital Market, it may limit our ability to raise additional funds (see Note 12). Recent events, such as the ongoing COVID-19 pandemic, the outbreak of war in eastern Europe, and the persistent inflationary environment have also caused volatility in the global financial markets and threatened a slowdown in the global economy, which may negatively affect our ability to raise additional capital on attractive terms or at all. If the Company is unable to raise sufficient additional funds when needed, on favorable terms or at all, the Company will not be able to continue the development of its product candidates as currently planned or at all, will need to reevaluate its planned operations and may need to delay, scale back or eliminate some or all of its development programs, reduce expenses or cease operations, any of which would have a significant negative impact on the Company's prospects and financial condition.

**Note 4—Balance Sheet Details**

*Property and Equipment*

Property and equipment, net, is comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **January 31, 2023** | **July 31, 2022** |
| Equipment and furniture | $1946312 | $1944540 |
| Computer software | 109242 | 109242 |
| Leasehold improvements | 32651 | 32651 |
| Construction in progress | 450714 | 446367 |
| Property and equipment, gross | 2538919 | 2532800 |
| Accumulated depreciation and amortization | (1637075) | (1554186) |
| Total | $901844 | $978614 |

---

Depreciation and amortization expense recorded for the three and six months ended January 31, 2023 was approximately $45,000 and $90,000, respectively.

Depreciation and amortization expense recorded for the three and six months ended January 31, 2022 was approximately $48,000 and $95,000, respectively.

*Intangible Assets*

Intangible assets, net, is comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **January 31, 2023** | **July 31, 2022** |
| License | $495000 | $495000 |
| Accumulated amortization | (151412) | (116471) |
| Total | $343588 | $378529 |

---

In November 2020, the Company licensed generator technology for use in its clinical trials and other research and development efforts. Unless earlier terminated, the term of the license agreement will remain in effect for 85 months. The Company has determined that the license has alternative future uses in research and development projects. The value of the acquired license is recorded as an intangible asset with amortization over the estimated useful life of 85 months.

Intangible asset amortization expense recorded for the three and six months ended January 31, 2023 was approximately $17,000 and $35,000, respectively.

Intangible asset amortization expense recorded for the three and six months ended January 31, 2022 was approximately $17,000 and $35,000, respectively.

At January 31, 2023, the estimated amortization expense by fiscal year based on the current carrying value of intangible assets is as follows:

---

| | |
|:---|:---|
| **Years ending July 31,** | |
| 2023 – the remainder of the fiscal year | $34941 |
| 2024 | 69882 |
| 2025 | 69882 |
| 2026 | 69882 |
| 2027 | 69882 |
| Thereafter | 29119 |
| Total | $343588 |

---

*Accounts Payable and Accrued Liabilities*

Accounts payable and accrued liabilities are comprised of the following:

Schedule of Accounts Payable and Accrued Liabilities

---

| | | |
|:---|:---|:---|
|  | **January 31, 2023** | **July 31, 2022** |
| Research and development costs | $3594633 | $3210627 |
| Professional services fees | 826751 | 877411 |
| Other | 268887 | 120184 |
| Total | $4690271 | $4208222 |

---

*Accrued Compensation Related*

Accrued compensation and related payroll liabilities are comprised of the following:

Schedule of Accrued Compensation

---

| | | |
|:---|:---|:---|
|  | **January 31, 2023** | **July 31, 2022** |
| Accrued payroll | $320737 | $311662 |
| Accrued bonus | 448570 |  |
| Accrued retention bonus | 318102 |  |
| 401K payable |  | 7333 |
| Accrued severance | 115710 | 57982 |
| Total | $1203119 | $376977 |

---

**Note 5—Note Payable**

On July 11, 2022, the Company entered into a finance agreement with AFCO Premium Credit LLC ("AFCO"). Pursuant to the terms of the agreement, AFCO loaned the Company the principal amount of $1,027,986, which would accrue interest at 5.248% per annum, to partially fund the payment of the premium of the Company's Director & Officer insurance. The agreement requires the Company to make eleven monthly payments of $95,923, including interest starting on July 18, 2022. At January 31, 2023 and July 31, 2022, the outstanding balance related to this finance agreement was $379,535 and $936,558, respectively.

**Note 6—Stockholders' Equity**

*Reverse Stock Split*

 

The Board of Directors of the Company approved a reverse stock split of the Company's authorized, issued and outstanding shares of common stock at a ratio of 1-for-22. The Reverse Stock Split became effective on November 9, 2022. All share and per share amounts for all periods presented in the accompanying condensed consolidated financial statements and notes thereto have been adjusted, on a retrospective basis, to reflect the Reverse Stock Split, unless otherwise stated. The number of authorized shares were also proportionately adjusted and the par value remained unaffected. The Company issued one whole share of the post-Reverse Stock Split Common Stock to any stockholder who otherwise would have received a fractional share as a result of the Reverse Stock Split. As a result, no fractional shares were issued in connection with the Reverse Stock Split and no cash or other consideration was paid in connection with any fractional shares that would otherwise have resulted from the Reverse Stock Split.

*Amendment of Articles of Incorporation*

On January 3, 2023, the Company filed a Certificate of Amendment (the "Certificate") to its Articles of Incorporation, as amended, with the Secretary of State of the State of Nevada to increase the number of shares of the Company's common stock authorized for issuance thereunder from 4,545,455 to 100,000,000 shares (the "Charter Amendment"). The Charter Amendment became effective upon filing the Certificate with the Secretary of State of the State of Nevada.

*December 2022 Offering*

On November 30, 2022, the Company entered into a Securities Purchase Agreement (the "Purchase Agreement") with certain investors (the "Investors"), pursuant to which the Company agreed to sell, issue, and deliver, in a public offering (the "Offering") (i) 1,166,667 shares of the Company's common stock, par value $0.0001 per share (each a "Share" and collectively the "Shares"); (ii) Pre-Funded Warrants in lieu of shares of common stock (the "Pre-Funded Warrants") to purchase shares of common stock and (iii) 1,166,667 Common Warrants (the "Common Warrants" and collectively with the Pre-Funded Warrants, the "Warrants") to purchase shares of common stock, to the Investors. Under the terms of the Purchase Agreement, the Company agreed to sell one Share or a Pre-Funded Warrant and one Common Warrant for each Share or Pre-Funded Warrant sold at a price of $3.00. For each Pre-Funded Warrant sold in the Offering, the number of Shares offered was decreased on a one-for-one basis.

The Common Warrants are exercisable immediately upon the date of issuance and have an exercise price of $3.00 per share, subject to adjustment. The Common Warrants will expire five (5) years from the date of issuance. The Pre-Funded Warrants are also exercisable immediately upon the date of issuance. The aggregate exercise price of the Pre-Funded Warrants, except for a nominal exercise price of $0.0001 per share of common stock, was pre-funded to the Company and, consequently, no additional consideration (other than the nominal exercise price of $0.0001 per share of common stock) is required for the exercise of the Pre-Funded Warrants.

The Offering closed on December 1, 2022, and the Company received gross proceeds of $3,500,001. As of the close of the Offering, the Company issued 250,000 Shares and Common Warrants to purchase 250,000 shares of common stock for a total consideration of $750,000 and 916,667 Pre-Funded Warrants to purchase 916,667 shares of common stock and 916,667 Common Warrants for a total consideration of $2,749,909. Further, all of 916,667 Pre-Funded Warrants were exercised on December 1, 2022. The terms and conditions of the Warrants are as noted and governed by the agreements entered into with the holders on December 1, 2022. Placement agent fees and other offering expenses of approximately $0.7 million incurred directly related to the offering were reflected as a reduction in additional paid in capital. Total proceeds were allocated between the Shares and Warrants on a relative fair value basis given both securities are equity classified. The fair value of the Common Warrants issued to the Investors in the offering was approximately $1.5 million (based on a Monte Carlo simulation assuming no dividend yield, a 5.0 year life, a risk-free interest rate of 3.61% and volatilities of 92.3% or 100% varying based on the trigger of a fundamental transaction).

*Outstanding Warrants*

During the six months ended January 31, 2023, shares of common stock issued related to the Pre-Funded Warrant exercises totaled 916,667. The Company realized proceeds of $92 from the Pre-Funded Warrant exercises. There were no warrants exercised during the six months ended January 31, 2022.

At January 31, 2023, the Company had outstanding warrants to purchase 1,242,564 shares of its common stock, with exercise prices ranging from $3.00 to $275.00, all of which were classified as equity instruments. These warrants expire at various dates between April 2023 and December 2027.

*China Grand Pharmaceutical and Healthcare Holdings Limited and Sirtex Medical US Holdings, Inc.*

On October 10, 2019, the Company and Grand Decade Developments Limited ("GDDL"), a direct, wholly-owned subsidiary of Grand Pharmaceutical Group Limited (formerly China Grand Pharmaceutical and Healthcare Holdings Limited), a company formed under the laws of the British Virgin Islands ("CGP"), and its affiliate, Sirtex Medical US Holdings, Inc., a Delaware corporation ("Sirtex") entered into Stock Purchase Agreements (as amended, the "Purchase Agreements"), pursuant to which the Company agreed to sell and issue to CGP and Sirtex 454,545 shares and 90,909 shares, respectively, of the Company's common stock for a total purchase price of $30.0 million. The net proceeds, after deducting offering fees and expenses paid by the Company, were approximately $28.0 million. This transaction closed on February 7, 2020 (the "Closing"). Pursuant to the Purchase Agreements, CGP and Sirtex were given the right under certain circumstances to purchase in the future additional shares of common stock in order to maintain CGP and Sirtex's respective ownership percentages of the outstanding shares of common stock of the Company as of the Closing.

**Note 7—Stock-Based Compensation**

The OncoSec Medical Incorporated 2011 Stock Incentive Plan (as amended and approved by the Company's stockholders (the "2011 Plan")), authorizes the Company's Board of Directors to grant equity awards, including but not limited to, stock options and restricted stock units, to employees, directors and consultants. The 2011 Plan authorizes a total of 209,091 shares of common stock for issuance. Under the 2011 Plan, incentive stock options are to be granted at a price that is no less than 100% of the fair value of the Company's common stock at the date of grant. Stock options vest over a period specified in the individual option agreements entered into with grantees and are exercisable for a maximum period of 10 years after the date of grant. Incentive stock options granted to stockholders who own more than 10% of the outstanding stock of the Company at the time of grant must be issued at an exercise price of no less than 110% of the fair value of the Company's common stock on the date of grant.

*Stock Options*

During the six months ended January 31, 2023, the Company granted an equity award that consisted of options to purchase 2,273 shares of its common stock to a director under the 2011 Plan. The stock options issued to a director have a 10-year term, vest over one year and have an exercise price of $9.94.

During the six months ended January 31, 2022, the Company granted options to purchase 1,065 and 1,137 shares of its common stock to employees and a consultant under the 2011 Plan, respectively. The stock options issued to employees have a 10-year term, vest over two years and have exercise prices ranging from $44.22 to $49.72. The stock options issued to the consultant have a 10-year term, vest over one year and have an exercise price of $31.24.

The Company accounts for stock-based compensation based on the fair value of the stock-based awards granted and records forfeitures as they occur. As such, the Company recognizes stock-based compensation cost only for those stock-based awards that vest over their requisite service period, based on the vesting provisions of the individual grants. The service period is generally the vesting period, with the exception of stock options granted pursuant to a consulting agreement, in which case the stock option vesting period and the service period are defined pursuant to the terms of the consulting agreement.

The following assumptions were used for the Black-Scholes calculation of the fair value of stock-based compensation related to stock options granted during the periods presented:

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| | | |
|:---|:---|:---|
|  | **Six Months**<br> **Ended**<br> **January 31, 2023** | **Six Months**<br> **Ended**<br> **January 31, 2022** |
| Expected term (years) | 5.12 – 5.49 years | 5.00 – 6.00 years |
| Risk-free interest rate | 4.07 – 4.09% | 0.69 – 1.30% |
| Volatility | 89.96 – 91.75% | 86.98 – 90.74% |
| Dividend yield | 0% | 0% |

---

The Company's expected volatility is derived from the historical daily change in the market price of its common stock. The Company uses the simplified method to calculate the expected term of options issued to employees, non-employees and directors, as the Company does not have much stock option exercise history and thus does not have enough information on exercise behavior to calculate a refined expected term based on that information. The risk-free interest rate used in the Black-Scholes calculation is based on the prevailing U.S. Treasury yield in effect at the time of grant, commensurate with the expected term. For the expected dividend yield used in the Black-Scholes calculation, the Company has never paid any dividends on its common stock and does not anticipate paying dividends on its common stock in the foreseeable future.

The following is a summary of the Company's 2011 Plan and non-Plan stock option activity for the six months ended January 31, 2023:

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Options** | **Weighted**<br> **Average**<br> **Exercise**<br> **Price** | **Weighted -**<br> **Average Remaining Contract**<br> **(in years)** | **Aggregate**<br> **Intrinsic**<br> **Value**<br> **($000)** |
| **Outstanding - July 31, 2022** | 133973 | $57.42 |  |  |
| Granted | 2273 | $9.94 |  |  |
| Forfeited/Cancelled | (17267) | $95.54 |  |  |
| **Outstanding - January 31, 2023** | 118979 | $50.88 | 8.1 | $- |
| **Exercisable - January 31, 2023** | 105093 | $52.87 | 7.9 | $- |

---

The weighted-average grant date fair value of stock options granted during the six months ended January 31, 2023 and 2022 was $7.31 and $27.18, respectively.

As of January 31, 2023, the Company has approximately $0.3 million in unrecognized stock-based compensation expense attributable to the outstanding options, which is expected to be recognized over a weighted-average period of 0.39 years.

Stock-based compensation expense recorded in the Company's condensed consolidated statements of operations for the three and six months ended January 31, 2023 resulting from stock options awarded to the Company's employees, directors and consultants was approximately $0.3 million and $0.5 million, respectively. Of the total expense, $0.1 million and $0.2 million, respectively, was recorded to research and development and $0.2 million and $0.3 million, respectively, was recorded in general and administrative in the Company's condensed consolidated statements of operations for the three and six months ended January 31, 2023.

Stock-based compensation expense recorded in the Company's condensed consolidated statements of operations for the three and six months ended January 31, 2022 resulting from stock options awarded to the Company's employees, directors and consultants was approximately $0.3 million and $0.8 million, respectively. Of the total expense, $0.2 million and $0.5 million, respectively, was recorded to research and development and $0.1 million and $0.3 million, respectively was recorded in general and administrative in the Company's condensed consolidated statements of operations for the three and six months ended January 31, 2022.

*Restricted Stock Units ("RSUs")*

For the three and six months ended January 31, 2023, the Company recorded approximately $36,000 and $89,000, respectively, in stock-based compensation related to RSUs, which is reflected in the condensed consolidated statements of operations.

For the three and six months ended January 31, 2022, the Company recorded approximately $54,000 and $130,000, respectively, in stock-based compensation related to RSUs, which is reflected in the condensed consolidated statements of operations.

The following table summarize RSUs issued and outstanding:

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| | | |
|:---|:---|:---|
|  | **RSUs** | **Weighted**<br> **Average**<br> **Grant Date**<br> **Fair Value** |
| **Nonvested and Outstanding - July 31, 2022** | 2710 | $75.02 |
| Vested | (1379) | $76.60 |
| Forfeited/Cancelled | (1282) | $69.52 |
| **Nonvested and Outstanding - January 31, 2023** | 49 | $168.08 |

---

As of January 31, 2023, there was no unrecognized compensation cost related to unvested RSUs.

*Shares Issued to Consultants*

During the three and six months ended January 31, 2022, 0 and 568 shares of common stock valued at $0 and approximately $0.04 million, respectively, were issued to a consultant for services. The common stock share values were based on the closing stock price of the Company's common stock on the date the shares were granted.

*2015 Employee Stock Purchase Plan*

Under the Company's 2015 Employee Stock Purchase Plan ("ESPP"), the Company is authorized to issue 2,273 shares of the Company's common stock. At January 31, 2023, there were 1,176 shares remaining available for issuance under the ESPP.

The ESPP is considered a Type B plan under FASB ASC Topic 718 because the number of shares a participant is permitted to purchase is not fixed based on the stock price at the beginning of the offering period and the expected withholdings. The ESPP enables the participant to "buy-up" to the plan's share limit, if the stock price is lower on the purchase date. As a result, the fair value of the awards granted under the ESPP is calculated at the beginning of each offering period as the sum of:

● 15 % of the share price of an unvested share at the beginning of the offering period,

● 85 % of the fair market value of a six-month call on the unvested share aforementioned, and

● 15 % of the fair market value of a six-month put on the unvested share aforementioned.

The fair market value of the six-month call and six-month put are based on the Black-Scholes option valuation model. For the six-month offering period ended on January 31, 2023, the following assumptions were used: six-month maturity, 2.91% risk free interest, 75.04% volatility, 0% forfeitures and $0 dividends. For the six-month offering period ended on January 31, 2022, the following assumptions were used: six-month maturity, 0.05% risk free interest, 72.99% volatility, 0% forfeitures and $0 dividends.

Approximately $300 and $1,200 was recorded as stock-based compensation during the six months ended January 31, 2023 and 2022, respectively.

*Common Stock Reserved for Future Issuance*

The following table summarizes all common stock reserved for future issuance at January 31, 2023:

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| | |
|:---|:---|
| Common Stock options outstanding (within the 2011 Plan and outside of the terms of the 2011 Plan) | 118979 |
| Common Stock reserved for restricted stock unit settlement | 49 |
| Common Stock authorized for future grant under the 2011 Plan | 91597 |
| Common Stock reserved for warrant exercise | 1242564 |
| Shares issuable under CGP and Sirtex stock purchase agreements (Note 6) | 85585 |
| Convertible note – related party | 360589 |
| Common Stock reserved for future ESPP issuance | 1176 |
| Total Common Stock reserved for future issuance | 1900539 |

---

**Note 8—Commitments and Contingencies**

*Contingencies*

The Company is not a party to any other legal proceeding or aware of any other threatened action as of the date of this report.

 

*Employment Agreements*

The Company has entered into employment agreements with certain executive officers and certain other key employees. Generally, the terms of these agreements provide that, if the Company terminates the officer or employee other than for cause, death or disability, or if the officer terminates his or her employment with the Company for good cause, the officer shall be entitled to receive certain severance compensation and benefits as described in each such agreement.

**Note 9—Leases**

*Lease Agreements*

The Company has operating leases for corporate offices and lab space. These leases have remaining lease terms of approximately less than one year to three years, some of which include options to extend the lease. For any lease where the Company is reasonably certain that a renewal option will be exercised, the lease payments associated with the renewal option period are included in the ROU asset and lease liability as of January 31, 2023.

On August 31, 2022, the Company provided a six month notice to MawIt Inc. (the "Six Month Notice") for a property at Pennington, New Jersey, which serves as the Company's New Jersey corporate headquarters. As stated in the Six Month Notice, the Company did not be renew the lease and vacated the property before February 28, 2023. The Company remeasured the lease payments and recorded decreases of ROU asset for approximately $120,000 and lease liabilities of approximately $120,000 for this operating lease.

On September 6, 2022, the Company entered in an agreement with Mountain View Office Park LLC for office space at Mountain View Office Park, Building 820, Suite 200, in Ewing, New Jersey. The lease commenced on January 1, 2023 and expires on December 31, 2025, with an option to renew for one additional three-year term. The Company recorded ROU asset and lease liabilities of approximately $313,000 for this operating lease.

On October 17, 2022, the Company provided a notice to Explora BioLabs (the "Notice") for a property at San Diego, California, which serves as the Company's lab space. The Company terminated the lease on December 16, 2022. The Company accounted for the Notice as a contract modification, and accordingly, recorded decreases of ROU asset for approximately $363,000 and lease liabilities of approximately $363,000 for this operating lease.

In January 2023, the Company elected not to renew the lease for its San Diego office and the lease will expire September 30, 2023. The Company remeasured the lease payments and recorded decreases of ROU asset for approximately $3,361,000 and lease liabilities of approximately $3,361,000 for this operating lease.

Supplemental balance sheet information related to leases as of January 31, 2023 was as follows:

---

| | | |
|:---|:---|:---|
| **Operating Leases:** | **As of**<br> **January 31,** **2023** | **As of**<br> **July 31,** **2022** |
| Operating lease right-of-use assets | $621827 | $4665515 |
| **Operating Leases:** |  |  |
| Current portion included in current liabilities | $958118 | $1111571 |
| Long-term portion included in non-current liabilities | 213835 | 4126636 |
| Total operating lease liabilities | $1171953 | $5238207 |

---

Supplemental lease expense related to leases is as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Three**<br> **Months Ended**<br> **January 31, 2023** | **For the Six**<br> **Months Ended**<br> **January 31, 2023** |
| Operating lease cost | $374625 | $753741 |
| &nbsp;&nbsp;&nbsp;Total lease expense | $374625 | $753741 |

---

Other information related to leases where the Company is the lessee is as follows:

Schedule of Other Information Related to Leases

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| | |
|:---|:---|
|  | **As of**<br> **January 31, 2023** |
| Weighted-average remaining lease term | 1.3 years |
| Weighted-average discount rate | 9.99% |

---

Supplemental cash flow information related to operating leases is as follows:

---

| | | |
|:---|:---|:---|
|  | **For the Three**<br> **Months Ended**<br> **January 31, 2023** | **For the Six**<br> **Months Ended**<br> **January 31, 2023** |
| Cash paid for operating lease liabilities | $385883 | $776307 |
| &nbsp;&nbsp;&nbsp;Total cash flows related to operating lease liabilities | $385883 | $776307 |

---

Future minimum lease payments under non-cancellable leases as of January 31, 2023 were as follows:

---

| | |
|:---|:---|
| **Years ending July 31,** | |
| 2023 – the remainder of the fiscal year | $734733 |
| 2024 | 342309 |
| 2025 | 122045 |
| Thereafter | 50852 |
| &nbsp;&nbsp;&nbsp;Total minimum lease payments | 1249939 |
| Less: Imputed interest | (77986) |
| Total | $1171953 |

---

**Note 10—401(k) Plan**

Effective May 15, 2012, the Company adopted a defined contribution savings plan pursuant to Section 401(k) of the Code. The plan is for the benefit of all qualifying employees and permits voluntary contributions by employees of up to 100% of eligible compensation, subject to the maximum limits imposed by Internal Revenue Service. The terms of the plan allow for discretionary employer contributions and the Company currently matches 100% of its employees' contributions, up to 3% of their annual compensation. The Company's contributions are recorded as expense in the accompanying condensed consolidated statements of operations. The Company's contributions totaled approximately $9,000 and $54,000 for the three and six months ended January 31, 2023, respectively. The Company's contributions totaled approximately $28,000 and $81,000 for the three and six months ended January 31, 2022, respectively.

**Note 11—Related Party Transactions**

Except as disclosed elsewhere herein, below are the Company's related party transactions for the six months ended January 31, 2023 and 2022.

*License Agreement and Service Agreement* 

On October 10, 2019, the Company entered into a license agreement with GDDL (the "License Agreement") and a Services Agreement with Sirtex (the "Services Agreement"). While both of the agreements are still valid and in full effect, to date neither has resulted in any charges, expenses or payments due to or from the Company to or from either GDDL or Sirtex, as applicable, because obligations arising out of both of such agreements will not impact the Company's operations or consolidated financial statements until, with respect to the Services Agreement, the Company begins commercialization planning for its lead product candidate, TAVO™-EP, or, with respect to the License Agreement, GDDL initiates clinical development in China of, and obtains marketing approval in, the jurisdictions subject to the License Agreement for the Company's current lead asset TAVO™-EP for intratumoral delivery by electroporation, or any of the Company's other product candidates subject to the License Agreement.

Pursuant to the License Agreement, the Company, among other things, granted GDDL and its affiliates an exclusive, sublicensable, royalty-bearing license to develop, manufacture, commercialize, or otherwise exploit the Company's current and future products, including TAVO™ and the VLA in the following territories: China Mainland, Hong Kong, Macau, Taiwan, Armenia, Azerbaijan, Bahrain, Bangladesh, Bhutan, Brunei, Burma, Cambodia, East Timor, Georgia, India, Indonesia, Jordan, Kazakhstan, Kuwait, Kyrgyzstan, Laos, Malaysia, Mongolia, Nepal, Oman, Pakistan, Papua New Guinea, Philippines, Qatar, Saudi Arabia, Singapore, South Korea, Sri Lanka, Tajikistan, Thailand, Turkmenistan, United Arab Emirates, Uzbekistan and Vietnam (the "Territory"). Under the terms of the License Agreement, GDDL will pay the Company up to 20% royalties on the Net Sales (as defined in the License Agreement) of such products in the Territory during the applicable Royalty Term (as defined in the License Agreement) (such royalties, the "Royalties').

During the Royalty Term for a Licensed Product (as defined in the License Agreement) and a Region (as defined in the License Agreement) in the Territory, under no circumstances will the Royalties payable to Company hereunder in respect of such Licensed Product and such Region for a calendar half be less than ten percent (10%) of Net Sales of such Licensed Product for such Region for such calendar half, provided that such percentage shall be pro-rated if such Royalty Term ends in such calendar half.

If either party believes that the other party has materially breached one or more of its material obligations under the License Agreement, then the non-breaching party may, following a cure period, terminate the License Agreement upon written notice to the breaching party, subject to other conditions. GDDL may terminate the License Agreement in its entirety for any reason or no reason upon prior written notice to Company. Additionally, the License Agreement may be terminated upon certain events involving bankruptcy or insolvency. If GDDL terminates the License Agreement for convenience or the Company terminates the License Agreement due to GDDL's breach or insolvency, then, subject to certain conditions, each party's rights and licenses will terminate, and GDDL will have certain obligations to assign to the Company, or grant a right of reference under, certain regulatory documentation or approvals. If GDDL terminates the License Agreement due to the Company's breach or insolvency, then GDDL will have the option either to keep the License Agreement in effect with the royalty rate owed by GDDL to the Company reduced by 50% or to terminate the License Agreement (in which case each party's rights and licenses will terminate, except that GDDL will have the right to wind down certain clinical trials).

Pursuant to the Services Agreement, the Company agreed, among other things, to pay Sirtex low single-digit royalties on the Net Sales (as defined in the Services Agreement) of all Products (defined as TAVO™ and VLA products and their accompanying generators, and any products (including, for clarity, combination products) incorporating or including such products and their accompanying generators), in all countries other than those in the Territory. In exchange for the royalty fee, Sirtex will provide the Company with certain services for these products, including key opinion leader management and engagement services, voice of customer (VOC) services, development of a go to market strategy, and pricing, reimbursement and market access services.

If either party believes that the other party has materially breached one or more of its material obligations under the Services Agreement, then the non-breaching party may, following a cure period, terminate the Services Agreement upon written notice to the breaching party, subject to other conditions. Sirtex may terminate the Services Agreement in its entirety for any reason or no reason upon prior written notice to the Company. Additionally, the Services Agreement may be terminated upon certain events involving bankruptcy or insolvency.

Both of the License Agreement and Service Agreement are still valid and in full effect. However, to date neither has resulted in any charges, expenses or payments due to or from the Company to or from either CGP or Sirtex, as applicable. The Company's product candidates are in the early stages of clinical development and, therefore, the Company has not yet had a need for, nor received any of the services being provided under the Services Agreement and is not planning to do so for another six to twelve months. Similarly, the Company's products that are subject to the License Agreement are still in the clinical development process and have not achieved regulatory approval by any U.S. based or foreign regulators. These processes can take years, and the Company does not anticipate full regulatory approval and commercialization in the jurisdictions subject to the License Agreement for at least three to five years or even longer.

 

*Co-Promotion Agreement*

In January 2021, the Company entered into a co-promotion agreement with Sirtex, pursuant to which the Company granted Sirtex the option to co-promote TAVO™-EP for the treatment of anti-PD-1 refractory locally advanced or metastatic melanoma in the U.S., including its territories and possessions. In consideration for the option, the Company received an upfront, non-refundable payment of $5.0 million from Sirtex (the "option fee"). The option to co-promote is non-exclusive and may be exercised at any time by Sirtex from the effective date until 90 days following the receipt by Sirtex of a complete copy of the final BLA filed by the Company with the FDA (the "option period"). If Sirtex exercises the option, the Company will receive an additional non-refundable and non-creditable option exercise fee of $25.0 million, comprised of $20.0 million in cash, and $5.0 million for the issuance of common shares of the Company determined by the average closing price of the stock for the 30 days prior to the date of receipt of the exercise notice for the option.

Under the terms of the co-promotion agreement, if Sirtex exercises the co-promote option, the Company will pay to Sirtex a high-teens to low-twenties royalty (the "promotion fee") of U.S. net sales of the TAVO™ products. The co-promotion agreement will continue until the earlier of the expiration of the option period without Sirtex extending the option or the eighth anniversary of the first FDA approval of the BLA, and can be extended by mutual agreement between the Company and Sirtex. During the co-promotion term, the Company is responsible for funding approximately two-thirds of the promotional costs incurred by Sirtex and Sirtex shall be responsible for approximately one-third.

The Company has determined that the co-promotion agreement represents a funded research and development arrangement within the scope of ASC Subtopic 730-20, Research and Development—Research and Development Arrangements (ASC 730-20). The Company concluded that there has not been a substantive and genuine transfer of risk related to the co-promotion agreement and the Company's ongoing development of TAVO™-EP as there is a presumption that the Company is obligated to repay Sirtex based on the significant related party relationship that exists between the parties. This significant related party relationship is based on Sirtex's approximate 8% ownership of the outstanding shares of the Company's common stock, and that of its significant equity holder, CGP (which owns 49% of Sirtex), which, at the time of entering into the agreement, owned approximately 42% of the outstanding shares of the Company's common stock and is the Company's largest shareholder.

The Company has determined that the appropriate accounting treatment under ASC 730-20 is to record any proceeds received from Sirtex for the co-promote option or upon exercise of the option as cash and cash equivalents as the Company has the ability to direct the usage of funds, and as a corresponding long-term liability ("Liability under co-promotion agreement – related party") on the Company's consolidated balance sheet when received. The liability will remain on the balance sheet until (i) Sirtex exercises the option which results in royalties paid by the Company to Sirtex based on the net sales of the TAVO™ products, or (ii) Sirtex does not exercise the option and the co-promotion agreement is terminated by the parties.

As of January 31, 2023, the balance of the Liability under co-promotion agreement – related party relates to the option fee payment of $5.0 million received from Sirtex.

*Convertible Note – Related Party*

On November 25, 2022 (the "Funding Date"), the Company entered into a Convertible Promissory Note and Security agreement with GDDL pursuant to which the Company issued a Secured Convertible Promissory Note (the "Note") to GDDL. The Note has a principal amount of $2,000,000, bears interest at a rate of 5% per annum until November 25, 2023 and 10% per annum thereafter (the "Interest Rate") and matures on November 25, 2024 (the "Maturity Date"), on which date the principal balance and all accrued interest under the Note shall be due and payable. The Interest Rate will be 10% per annum upon occurrence of an event of default, including, but not limited to, the failure by the Company to make payment of principal or interest due under the Note on the Maturity Date, and any commencement by the Company of a case under any applicable bankruptcy or insolvency laws. The principal and interest accrued on the Note may be prepaid without any further agreement of the parties to the Note, or converted (as described below) upon the agreement of the parties to the Note, at any time without penalty to the Company.

Subject to the consent of GDDL, the Note is convertible into such number of fully paid and non-assessable shares of the Company's common stock, par value $0.0001 per share (the "Common Stock") as determined by dividing (i) any portion of the unpaid principal and accrued interest of the Note then outstanding by (ii) the greater of (a) the last closing bid price of a share of Common Stock as reported on the Nasdaq Capital Market ("Nasdaq") on the date the Company and GDDL agree to such conversion and (b) the average closing bid price of a share of Common Stock as reported on Nasdaq for the thirty trading days immediately preceding such date, subject to a share cap of 360,589 shares of Common Stock (the "Share Cap"), representing 19.99% of the total issued and outstanding shares of Common Stock as of November 25, 2022.

Additionally, if at any time after the Funding Date the last closing bid price of a share of Common Stock as reported on the Nasdaq for ten consecutive trading days or the average closing bid price of a share of Common Stock as reported on Nasdaq for the thirty trading days immediately preceding such date is equal to or exceeds $44.00 (subject to any reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other substantially similar transaction), GDDL may require that the Company prepay the Note through conversion of the then outstanding principal and/or any accrued interest thereon into shares of Common Stock, in whole or in part.

The unpaid principal of and any accrued interest on the Note constitute unsubordinated obligations of the Company and are senior and preferred in right of payment to all equity securities of the Company outstanding as of the Funding Date, which are secured by all of the Company's right, title and interest, in and to certain of the Company's intellectual property rights in Hong Kong, Taiwan, China and South Korea, as specified in the Note; provided, however, that the Company may incur or guarantee additional indebtedness after the Funding Date, whether such indebtedness are senior, pari passu or junior to the obligations under the Note.

In connection with the issuance of the Note, the Company incurred $113,391 in fees and costs. These fees were recorded as a discount on the Note and will be amortized to interest expense over the term of the note.

The following table sets forth the Company's obligations under the Note:

---

| | | |
|:---|:---|:---|
|  | **January 31, 2023** | **July 31, 2022** |
| Convertible note – related party | $2000000 | $- |
| Interest payable | 16667 | - |
| Subtotal | 2016667 |  |
| Unamortized debt issuance costs | (103942) | - |
| Total carrying value of convertible note – related party | 1912725 | - |
| Less current portion | - | - |
| Convertible note – related party, net of current portion | $1912725 | $- |

---

For the three and six months ended January 31, 2023, the Company recognized $17,000 of interest expense related to the Note.

Future minimum payments due under the convertible note - related party were as follows:

---

| | |
|:---|:---|
| **Years ending July 31,** | |
| 2023 – the remainder of the fiscal year | $- |
| 2024 |  |
| 2025 | 2000000 |
| 2026 |  |
| 2027 |  |
| Thereafter | - |
| Total | $2000000 |

---

**Note 12—Nasdaq Deficiency Notice**

 

On December 27, 2022, the Company received a notice from Nasdaq indicating that the Company was not in compliance with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on Nasdaq to maintain a minimum of $2.5 million in stockholders' equity for continued listing. The Company has reported a stockholders' deficit of approximately $5.5 million in this quarterly report on Form 10-Q for the period ended January 31, 2023, and, as a result, does not currently satisfy Listing Rule 5550(b)(1). The notice has no immediate impact on the listing of the Company's common stock, which will continue to be listed and traded on Nasdaq, subject to the Company's compliance with the other continued listing requirements. The notice provided the Company with 45 calendar days, or until February 10, 2023, to submit a plan to regain compliance. The Company submitted such a plan to Nasdaq on February 10, 2023, and on February 21, 2023, the Company received a notice from Nasdaq that it had been granted 180 calendar days from December 27, 2022, or until June 26, 2023, to regain compliance. There can be no assurance that the Company will be able to regain compliance with all applicable continued listing requirements. In the event the Company fails to regain compliance within the compliance period, the Company would have the right to a hearing before an independent panel. The hearing request would halt any suspension or delisting action pending the conclusion of the hearing process and the expiration of any additional extension period granted by the panel following the hearing.

 

**ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.**

*Unless the context indicates otherwise, all references to "OncoSec," "the Company," "we," "us" and "our" in this report refer to OncoSec Medical Incorporated and its consolidated subsidiary. The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and the related notes included in this report.*

*This discussion and analysis of our financial condition and results of operations is not a complete description of our business or the risks associated with an investment in our common stock. As a result, this discussion and analysis should be read together with our condensed consolidated financial statements and related notes included in this report, as well as the other disclosures in this report and in the other documents we file from time to time with the Securities and Exchange Commission, or SEC, including our Annual Report on Form 10-K for our fiscal year ended July 31, 2022 filed with the SEC on October 31, 2022 (the "Annual Report"). Pursuant to Instruction 2 to paragraph (b) of Item 303 of Regulation S-K promulgated by the SEC, in preparing this discussion and analysis, we have presumed that readers have access to and have read the discussion and analysis of our financial condition and results of operations included in the Annual Report.*

*This discussion and analysis and the other disclosures in this report contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or Exchange Act. Forward-looking statements relate to future events or circumstances or our future performance and are based on our current assumptions, expectations and beliefs about future developments and their potential effect on our business. All statements in this report that are not statements of historical fact could be forward-looking statements. The forward-looking statements in this discussion and analysis and elsewhere in this report include statements about, among other things, the status, progress and results of our clinical programs and our expectations regarding our liquidity and performance, including our expense levels, and the potential impact of the COVID-19 pandemic. Forward-looking statements are only predictions and are not guarantees of future performance, and they are subject to known and unknown risks, uncertainties and other factors, including the risks described under the heading "Risk Factors" herein and in Part I, Item IA of the Company's most recent Annual Report on Form 10-K and similar discussions contained in the other documents we file from time to time with the SEC. In light of these risks, uncertainties and other factors, the forward-looking events and circumstances described in this report may not occur and our results, levels of activity, performance or achievements could differ materially from those expressed in or implied by any forward-looking statements we make. As a result, you should not place undue reliance on any of our forward-looking statements. Forward-looking statements speak only as of the date they are made, and unless required to by law, we undertake no obligation to update or revise any forward-looking statement for any reason, including to reflect new information, future developments, actual results or changes in our expectations. Unless otherwise stated herein, all share and per share numbers relating to the Company's common stock prior to the effectiveness of the Reverse Stock Split have been adjusted to give effect to the Reverse Stock Split.*

**Overview**

We are a late-stage immuno-oncology company focused on designing, developing and commercializing innovative, proprietary, intra-tumoral DNA-based therapeutics to stimulate and to augment anti-tumor immune responses for the treatment of cancers. Our core technology platform ImmunoPulse® is a drug-device therapeutic modality platform comprised of proprietary intratumoral electroporation ("EP") delivery devices (the "OMS EP Device") and a proprietary DNA plasmid delivery and application method that triggers transient expression of target protein in cells. The OMS EP Device is designed to promote cellular uptake of plasmid DNA-encoded drugs directly into a solid tumor and promote an immunological response against the cancer. The OMS EP Device can be adapted to treat different tumor types, and consists of an electrical pulse generator paired with disposable applicators. Our lead product candidate is a DNA-encoded interleukin-12 ("IL-12") called tavokinogene telseplasmid ("TAVO™"). The OMS EP Device is used to deliver TAVO™ intratumorally, with the aim of reversing the immunosuppressive microenvironment in the treated tumor. The activation of the appropriate inflammatory response can drive a systemic anti-tumor response against untreated tumors in other parts of the body. In 2017, we received Fast Track Designation and Orphan Drug Designation from the U.S. Food and Drug Administration ("FDA") for TAVO™ in metastatic melanoma, which could qualify TAVO™ for expedited FDA review, a rolling Biologics License Application review and certain other benefits.

Our current focus is to pursue TAVO™-EP in combination with KEYTRUDA® (pembrolizumab) in melanoma.

***Performance Outlook***

As a result of recent cash runway and working capital limitations, we expect to use our available working capital in the near term primarily for the advancement of our existing and planned clinical melanoma programs, including delivery of the KEYNOTE-695 trial results. In order to preserve our existing working capital, we have decreased clinical work on our other clinical trials and studies, including those involving triple negative breast cancer. We anticipate our spending on clinical programs and the development of our next-generation OMS EP Device will continue throughout our current fiscal year. Our spending on research and development programs will be prioritized to support development of TAVO™-EP in melanoma. Due to ongoing restructuring efforts, we expect our cash-based general and administrative expenses to remain relatively flat in the near term, as we seek to continue to leverage internal resources and automate processes to decrease our outside services expenses. See "Results of Operations" below for more information.

***Restructuring Plan***

On October 2, 2022, our Board of Directors authorized a restructuring plan (the "Restructuring Plan") that is designed to prioritize clinical activities in melanoma to reduce operating expenses while advancing our lead product candidate, TAVO™ EP, toward near-term data milestones in connection with the KEYNOTE-695 clinical trial. As part of the Restructuring Plan, we restructured our internal operations and reduced our workforce by approximately 45%, or 17 employees.

The Company incurred charges of approximately $650,000 through January 31, 2023, in connection with the Restructuring Plan, consisting primarily of expenditures for employee transition, notice period and severance payments, retention bonus payments, and related costs. The Company currently estimates that it will incur additional charges of approximately $200,000 during the remainder of the first calendar quarter of 2023 in connection with the Restructuring Plan, consisting primarily of cash expenditures for retention bonus payments and related costs.

The charges that we expect to incur in connection with the Restructuring Plan are estimates and subject to a number of assumptions, and actual results may differ materially. We expect to operationalize additional cost reduction actions that will include other incremental cost reduction actions unrelated to workforce reductions.

Additionally, in connection with the Restructuring Plan, on December 26, 2022, our Board of Directors approved cash bonus retention awards for certain members of our leadership team, pursuant to which we will provide a cash incentive designed to retain such employees (the "Retention Bonuses"). Pursuant to the terms of the Retention Bonuses, eligible employees will each receive a cash bonus award of $50,000 (not to exceed $300,000 in the aggregate for all recipients of the Retention Bonuses), to be paid on or about August 4, 2023, for services rendered to us during the period beginning on October 7, 2022 and ending on July 31, 2023, subject to each eligible employee's continued employment and good standing with us on July 31, 2023. Our President and Chief Executive Officer and our Chief Financial Officer will not receive Retention Bonuses.

***Nasdaq Deficiency Notice***

On December 27, 2022, we received a notice from the Nasdaq Stock Market, LLC ("Nasdaq") indicating that we were not in compliance with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on Nasdaq to maintain a minimum of $2.5 million in stockholders' equity for continued listing. We have reported a stockholders' deficit of approximately $5.5 million in this quarterly report on Form 10-Q for the period ended January 31, 2023, and, as a result, do not currently satisfy Listing Rule 5550(b)(1). The notice has no immediate impact on the listing of our common stock, which will continue to be listed and traded on Nasdaq, subject to our compliance with the other continued listing requirements. The notice provided us with 45 calendar days, or until February 10, 2023, to submit a plan to regain compliance. We submitted such a plan to Nasdaq on February 10, 2023, and on February 21, 2023, we received a notice from Nasdaq that we had been granted 180 calendar days from December 27, 2022, or until June 26, 2023, to regain compliance. There can be no assurance that we will be able to regain compliance with all applicable continued listing requirements. In the event we fail to regain compliance within the compliance period, we have the right to a hearing before an independent panel. The hearing request would halt any suspension or delisting action pending the conclusion of the hearing process and the expiration of any additional extension period granted by the panel following the hearing.

We intend to take all reasonable measures available to regain compliance under the Nasdaq Listing Rules and remain listed on Nasdaq. If trading in our common stock is suspended on Nasdaq or our common stock is delisted by Nasdaq for any reason, it could negatively impact us as it would likely reduce the liquidity and market price of our common stock; reduce the number of investors willing to hold or acquire our common stock; negatively impact our ability to access equity markets and obtain financing; and impair our ability to provide equity incentives.

**Results of Operations for the Three Months Ended January 31, 2023 Compared to the Three Months Ended January 31, 2022**

The unaudited financial data for the three months ended January 31, 2023 and 2022 is presented in the following table and the results of these two periods are included in the discussion thereafter.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months**<br> **Ended**<br> **January 31,**<br> **2023** | **Three Months**<br> **Ended**<br> **January 31,**<br> **2022** | **$**<br> **Change** | **%**<br> **Change** |
| **Revenue** | $- | $- | $- |  |
| **Expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Research and development | 4653595 | 6825540 | (2171945) | (32) |
| &nbsp;&nbsp;&nbsp;General and administrative | 3009912 | 2590893 | 419019 | 16 |
| **Loss from operations** | (7663507) | (9416433) | 1752926 | (19) |
| &nbsp;&nbsp;&nbsp;Other expense, net | (14636) | (2583) | (12053) | 467 |
| &nbsp;&nbsp;&nbsp;Interest expense | (33551) | (5382) | (28169) | 523 |
| &nbsp;&nbsp;&nbsp;Foreign currency exchange gain (loss), net | 853764 | (480072) | 1333836 | (278) |
| **Loss before income taxes** | (6857930) | (9904470) | 3046540 | (31) |
| &nbsp;&nbsp;&nbsp;Income tax expense | 2950 | 2950 | - | 0 |
| **Net loss** | $(6860880) | $(9907420) | $3046540 | (31) |

---

***Revenue***

We have not generated any revenue since our inception, and we do not anticipate generating revenue in the near term.

***Research and Development Expenses***

Our research and development expenses decreased by approximately $2.1 million, from $6.8 million during the three months ended January 31, 2022, to $4.7 million during the three months ended January 31, 2023. This decrease was primarily due to: (i) a $2.0 million decrease in clinical trial related costs to support our various clinical trials and costs for discovery research and product development (See "Performance Outlook" above), (ii) a $0.1 million decrease in payroll and related benefit expenses as follows: $0.7 million decrease in salaries and related benefit expenses due to decreased headcount offset by severance costs of $0.1 million, retention bonuses of $0.2 million and annual bonuses of $0.3 million and (iii) a $0.1 million decrease in stock-based compensation to employees and consultants.

***General and Administrative***

Our general and administrative expenses increased by $0.4 million, from $2.6 million during the three months ended January 31, 2022, to $3.0 million during the three months ended January 31, 2023. This increase was largely due to the following: (i) a $0.5 million increase in payroll and related benefit expenses as follows: $0.2 million increase in salaries and related benefit expenses as executive positions were filled during the second half of fiscal year 2022, retention bonuses of $0.1 million and annual bonuses of $0.2 million and (ii) a $0.3 million increase in legal fees due to intellectual property and general corporate counseling and expenses related to a special shareholder meeting held in December 2022. These increases were partially offset by (i) a $0.3 million decrease in director fees paid to members of former Leadership Committee of our Board of Directors due to it dissolved in May 2022, (ii) a $0.1 million decrease partially related to recruiting expenses, and (iii) a $0.1 million decrease in insurance costs related to decreased D&O insurance premiums.

***Foreign Currency Exchange Gain (Loss), Net***

Foreign currency exchange gain (loss), net, increased by approximately $1.4 million from a $0.5 million loss during the three months ended January 31, 2022, to a $0.9 million gain for the three months ended January 31, 2023. This increase was primarily due to unrealized foreign currency transaction gain recognized in connection with our Australian subsidiary's intercompany loan.

**Results of Operations for the Six Months Ended January 31, 2023 Compared to the Six Months Ended January 31, 2022**

The unaudited financial data for the six months ended January 31, 2023 and January 31, 2022 is presented in the following table and the results of these two periods are included in the discussion thereafter.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **Six Months Ended**<br> **January 31,**<br> **2023** | **Six Months Ended**<br> **January 31,**<br> **2022** | **$**<br> **Change** | **%**<br> **Change** |
| **Revenue** | $- | $- | $- |  |
| **Expenses** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Research and development | 9421968 | 13471311 | (4049343) | (30) |
| &nbsp;&nbsp;&nbsp;General and administrative | 5548409 | 5860616 | (312207) | (5) |
| **Loss from operations** | (14970377) | (19331927) | 4361550 | (23) |
| &nbsp;&nbsp;&nbsp;Other income (expense), net | 23463 | (4594) | 28057 | (611) |
| &nbsp;&nbsp;&nbsp;Interest expense | (44632) | (13427) | (31205) | 232 |
| &nbsp;&nbsp;&nbsp;Foreign currency exchange gain (loss), net | 72218 | (363147) | 435365 | (120) |
| **Loss before income taxes** | (14919328) | (19713095) | 4793767 | (24) |
| &nbsp;&nbsp;&nbsp;Income tax expense | 2950 | 2950 | - | 0 |
| **Net loss** | $(14922278) | $(19716045) | $4793767 | (24) |

---

***Revenue***

We have not generated any revenue since our inception, and we do not anticipate generating revenue in the near term.

***Research and Development Expenses***

Our research and development expenses decreased by approximately $4.1 million, from $13.5 million during the six months ended January 31, 2022, to $9.4 million during the six months ended January 31, 2023. This decrease was primarily due to the following: (i) a $3.3 million decrease in clinical trial-related costs to support our various clinical trials and costs for discovery research and product development (See "Performance Outlook" above), (ii) a $0.4 million decrease in payroll and related benefit expenses as follows: $1.3 million decrease in salaries and related benefit expenses due to decreased headcount offset by severance costs of $0.3 million, retention bonuses of $0.3 million and annual bonuses of $0.3 million and (iii) a $0.3 million decrease in stock-based compensation expense to employees and consultants.

***General and Administrative***

Our general and administrative expenses decreased by approximately $0.4 million, from $5.9 million during the six months ended January 31, 2022, to $5.5 million during the six months ended January 31, 2023. This decrease was largely due to the following: (i) a $0.4 million decrease related to recruiting expenses, (ii) a $0.3 million decrease in director fees paid to members of our former Leadership Committee of our Board of Directors due to it dissolving in May 2022 and (iii) a $0.2 million decrease in insurance costs related to decreased D&O insurance premiums. These decreases were partially offset by (i) a $0.3 million increase in payroll and related benefit expenses as follows: $0.4 million increase in salaries and related benefit expenses as executive positions were filled during the second half of fiscal year 2022, $0.2 million in retention bonuses, $0.2 million in annual bonuses and a decrease of $0.4 million in severance expense and (ii) a $0.2 million increase million increase in legal fees due to intellectual property counseling.

***Foreign Currency Exchange Gain (Loss), Net***

Foreign currency exchange gain (loss), net, increased by approximately $0.4 million from a $0.3 million loss during the six months ended January 31, 2022 to a $0.1 million gain for the six months ended January 31, 2023. This increase was primarily due to unrealized foreign currency transaction gain recognized in connection with the Australian subsidiary's intercompany loan.

**Liquidity and Capital Resources**

***Working Capital***

The following table and subsequent discussion summarize our working capital as of each of the periods presented:

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| | | |
|:---|:---|:---|
|  | **At**<br> **January 31, 2023** | **At**<br> **July 31, 2022** |
| Current assets | $6441575 | $15232471 |
| Current liabilities | 7231043 | 6633328 |
| Working capital | $(789468) | $8599143 |

---

*Current Assets*

Current assets as of January 31, 2023 decreased by $8.8 million to $6.4 million, from $15.2 million as of July 31, 2022. This decrease was primarily related to a decrease in cash of $8.6 million and a decrease in prepaid expenses and other current assets of $0.2 million. The decrease in cash was due to cash used to support our operations during the six months ended January 31, 2023. The decrease in prepaid expenses and other current assets was due to amortization of prepaid insurance, partially offset by an increase in our research and development tax credit receivable.

*Current Liabilities*

Current liabilities as of January 31, 2023 increased by $0.6 million to $7.2 million, from $6.6 million as of July 31, 2022. This increase was primarily due to (i) an increase in accounts payable and accrued expenses due to slow payments and (ii) an increase in accrued compensation and related payroll liabilities due to accruals for retention bonuses and annual bonuses.

 ****

***Cash Flow***

*Cash Used in Operating Activities*

Net cash used in operating activities for the six months ended January 31, 2023 was $12.7 million, as compared to $19.9 million for the six months ended January 31, 2022. The $7.1 million decrease in cash used in operating activities was primarily attributable to a decrease in cash used to support our operating activities, including but not limited to, our clinical trials, research and development activities and general working capital requirements.

*Cash Used in Investing Activities*

Net cash used in investing activities for the six months ended January 31, 2023 was $0.01 million, as compared to $0.2 million for the six months ended January 31, 2022. During the six months ended January 31, 2023, the Company purchased fixed assets for use in its office and sold a piece of lab equipment. During the six months ended January 31, 2022, the Company purchased fixed assets for use in its clinical trials.

*Cash Provided by (Used in) Financing Activities*

Net cash provided by financing activities was $4.2 million for the six months ended January 31, 2023, as compared to $0.5 million cash used in financing activities for the six months ended January 31, 2022. Net cash provided by financing activities during the six months ended January 31, 2023 was primarily attributable to the $1.9 million net proceeds received from issuance of a convertible note to a related party and $2.8 million net proceeds received from the December 2022 offering. Net cash used in financing activities during the six months ended January 31, 2022 was primarily attributable to payments on a note payable.

***Uses of Cash and Cash Requirements***

Our primary uses of cash have been to finance clinical and research and development activities focused on the identification and discovery of new potential product candidates, the development of innovative and proprietary medical approaches for the treatment of cancer, and the design and advancement of pre-clinical and clinical trials and studies related to our pipeline of product candidates. We also use our capital resources on general and administrative activities and building and strengthening our corporate infrastructure, programs and procedures to enable compliance with applicable federal, state and local laws and regulations.

Our primary objectives for the next 12 months are to continue the advancement of TAVO™-EP in combination with KEYTRUDA® (pembrolizumab) in melanoma and to continue our research and development activities for our next-generation OMS EP device. In addition, we expect to pursue capital-raising transactions, which could include equity or debt financings, in the near term to fund our existing and planned operations and acquire and develop additional assets and technology consistent with our business objectives as opportunities arise.

*Operating lease obligations*

We enter into various leases as a lessee for office buildings. As of January 31, 2023, operating lease obligations totaled $1.2 million, of which $1.0 million is due within one year. These amounts did not reflect imputed interest adjustments. For more information on our leases, see Note 9, "Leases", to the Condensed Consolidated Financial Statements in Item I of Part I.

*Debt*

As of January 31, 2023, future principal payment obligations on our debt totaled $2.4 million, of which $0.4 million is due within one year. For more information on our debt, see Note 5, "Note Payable" and Note 11, "Related Party Transactions", to the Condensed Consolidated Financial Statements in Item I of Part I.

***Going Concern and Management's Plans***

We have sustained losses in all reporting periods since inception, with an accumulated deficit of approximately $301 million as of January 31, 2023. These losses are expected to continue for an extended period of time. Further, we have never generated any cash from our operations and do not expect to generate such cash in the near term. The aforementioned factors raise substantial doubt about our ability to continue as a going concern within one year from the issuance date of the condensed consolidated financial statements. The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset amounts or the classification of liabilities that might be necessary should we be unable to continue as a going concern within one year after the date the condensed consolidated financial statements are issued.

As of March 6, 2023, we had cash and cash equivalents of $2.0 million. Since inception, cash flows from financing activities have been the primary source of our liquidity. Based on our current cash levels, we believe our cash resources are insufficient to meet our anticipated needs for the 12 months following the date the condensed consolidated financial statements are issued.

We will need to raise additional capital to regain compliance with Nasdaq continued listing standards, continue operating our business and fund our planned operations, including research and development, clinical trials and, if regulatory approval is obtained, commercialization of its product candidates. In addition, we will require additional financing if we desire to in-license or acquire new assets, research and develop new compounds or new technologies and pursue related patent protection, or obtain any other intellectual property rights or other assets. There is no assurance that additional financing will be available to us when needed, that Management will be able to obtain financing on terms acceptable to us, or whether we will become profitable and generate positive operating cash flow. The source, timing and availability of any future financing will depend principally upon market conditions, and, more specifically, on the progress of our clinical development programs. Similarly, if our common stock is delisted from Nasdaq, it may limit our ability to raise additional funds. See "Nasdaq Deficiency Notice" above. Recent events, such as the ongoing COVID-19 pandemic, the outbreak of war in eastern Europe, and the persistent inflationary environment have also caused volatility in the global financial markets and threatened a slowdown in the global economy, which may negatively affect our ability to raise additional capital on attractive terms or at all. If we are unable to raise sufficient additional funds when needed, on favorable terms or at all, we will not be able to continue the development of our product candidates as currently planned or at all, will need to reevaluate our planned operations and may need to delay, scale back or eliminate some or all of our development programs, reduce expenses or cease operations, any of which would have a significant negative impact on our prospects and financial condition.

***Sources of Capital***

We have not generated any revenue since our inception, and we do not anticipate generating revenue in the near term. Historically, we have raised the majority of the funding for our business through offerings of our common stock and warrants to purchase our common stock. If we issue equity or convertible debt securities to raise additional funds, our existing stockholders would experience further dilution, and the new equity or debt securities may have rights, preferences and privileges senior to those of our existing stockholders. If we incur debt, our fixed payment obligations, liabilities and leverage relative to our equity capitalization would increase, which could increase the cost of future capital. Further, the terms of any debt securities we issue or borrowings we incur, if available, could impose significant restrictions on our operations, such as limitations on our ability to incur additional debt or issue additional equity or other operating restrictions that could adversely affect our ability to conduct our business, and any such debt could be secured by any or all of our assets pledged as collateral. Additionally, we may incur substantial costs in pursuing future capital, including investment banking, legal and accounting fees, printing and distribution expenses and other costs.

*Reverse Stock Split*

Our Board of Directors approved a reverse stock split of the Company's authorized, issued and outstanding shares of common stock at a ratio of 1-for-22 (the "Reverse Stock Split"). The Reverse Stock Split became effective on November 9, 2022 (the "Effective Date"). All share and per share amounts for all periods presented in the accompanying consolidated financial statements and notes thereto have been adjusted, on a retrospective basis, to reflect the Reverse Stock Split, unless otherwise stated. The number of authorized shares were also proportionately adjusted and the par value remained unaffected. We issued one whole share of the post-Reverse Stock Split Common Stock to any stockholder who otherwise would have received a fractional share as a result of the Reverse Stock Split. As a result, no fractional shares were issued in connection with the Reverse Stock Split and no cash or other consideration was paid in connection with any fractional shares that would otherwise have resulted from the Reverse Stock Split.

*Convertible Note – Related Party*

On November 25, 2022 (the "Funding Date"), we entered into a Convertible Note and Security agreement with GDDL pursuant to which the Company issued a Secured Convertible Note (the "Note") to GDDL. The Note has a principal amount of $2,000,000, bears interest at a rate of 5% per annum until November 25, 2023 and 10% per annum thereafter (the "Interest Rate") and matures on November 25, 2024 (the "Maturity Date"), on which date the principal balance and all accrued interest under the Note shall be due and payable. The Interest Rate will be 10% per annum upon occurrence of an event of default, including, but not limited to, the failure by us to make payment of principal or interest due under the Note on the Maturity Date, and any commencement by the Company of a case under any applicable bankruptcy or insolvency laws. The principal and interest accrued on the Note may be prepaid without any further agreement of the parties to the Note, or converted (as described below) upon the agreement of the parties to the Note, at any time without penalty to the Company.

Subject to the consent of GDDL, the Note is convertible into such number of fully paid and non-assessable shares of the our common stock, par value $0.0001 per share as determined by dividing (i) any portion of the unpaid principal and accrued interest of the Note then outstanding by (ii) the greater of (a) the last closing bid price of a share of our common stock as reported on the Nasdaq Capital Market ("Nasdaq") on the date the Company and GDDL agree to such conversion and (b) the average closing bid price of a share of our common stock as reported on Nasdaq for the thirty trading days immediately preceding such date, subject to a share cap of 360,589 shares of our common stock (the "Share Cap"), representing 19.99% of the total issued and outstanding shares of our common stock as of November 25, 2022.

Additionally, if at any time after the Funding Date the last closing bid price of a share of our common stock as reported on the Nasdaq for ten consecutive trading days or the average closing bid price of a share of our common stock as reported on Nasdaq for the thirty trading days immediately preceding such date is equal to or exceeds $44.00 (subject to any reorganization, recapitalization, reclassification, stock dividend, stock split, reverse stock split or other substantially similar transaction), GDDL may require that we prepay the Note through conversion of the then outstanding principal and/or any accrued interest thereon into shares of our common stock, in whole or in part.

The unpaid principal of and any accrued interest on the Note constitute unsubordinated obligations of the Company and are senior and preferred in right of payment to all equity securities of the Company outstanding as of the Funding Date, which are secured by all of the Company's right, title and interest, in and to certain of the Company's intellectual property rights in Hong Kong, Taiwan, China and South Korea, as specified in the Note; provided, however, that the Company may incur or guarantee additional indebtedness after the Funding Date, whether such indebtedness are senior, pari passu or junior to the obligations under the Note.

*December 2022 Offering*

On November 30, 2022, we entered into a Securities Purchase Agreement (the "Purchase Agreement") with certain investors (the "Investors"), pursuant to which we agreed to sell, issue, and deliver, in a registered public offering (the "Offering") (i) 1,166,667 shares of our common stock, par value $0.0001 per share (each a "Share" and collectively the "Shares"); (ii) Pre-Funded Warrants in lieu of shares of common stock (the "Pre-Funded Warrants") to purchase shares of common stock and (iii) 1,166,667 Common Warrants (the "Common Warrants" and collectively with the Pre-Funded Warrants, the "Warrants") to purchase shares of common stock, to the Investors. Under the terms of the Purchase Agreement, we agreed to sell one Share or a Pre-Funded Warrant and one Common Warrant for each Share or Pre-Funded Warrant sold at a price of $3.00. For each Pre-Funded Warrant sold in the Offering, the number of Shares offered was decreased on a one-for-one basis.

The Common Warrants are exercisable immediately upon the date of issuance and have an exercise price of $3.00 per share, subject to adjustment. The Common Warrants will expire five (5) years from the date of issuance. The Pre-Funded Warrants are also exercisable immediately upon the date of issuance. The aggregate exercise price of the Pre-Funded Warrants, except for a nominal exercise price of $0.0001 per share of common stock, was pre-funded to us and, consequently, no additional consideration (other than the nominal exercise price of $0.0001 per share of common stock) is required for the exercise of the Pre-Funded Warrant.

The Offering closed on December 1, 2022, and we received gross proceeds of $3,500,001. As of the close of the Offering, we issued 250,000 Shares and Common Warrants to purchase 250,000 shares of common stock for a total consideration of $750,000 and 916,667 Pre-Funded Warrants to purchase 916,667 shares of common stock and 916,667 Common Warrants for a total consideration of $2,749,909. Further, all of 916,667 Pre-Funded Warrants were exercised on December 1, 2022. The terms and conditions of the Warrants are as noted and governed by the agreements entered into with the holders on December 1, 2022. Placement agent fees and other offering expenses of approximately $0.7 million incurred directly related to the offering were reflected as a reduction in additional paid in capital. Total proceeds were allocated between the Shares and Warrants on a relative fair value basis given both securities are equity classified. The fair value of the Common Warrants issued to the Investors in the offering was approximately $1.5 million (based on a Monte Carlo simulation assuming no dividend yield, a 5.0 year life, a risk-free interest rate of 3.61% and volatilities of 92.3% or 100% varying based on the trigger of a fundamental transaction.)

**Critical Accounting Policies**

*Use of Estimates*

The accompanying consolidated financial statements have been prepared in conformity with U.S. GAAP, which requires Management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Significant accounting estimates related to our ability to continue as a going concern and certain calculations related to that determination. We base our estimates on historical experience and on various other assumptions that we believe are reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. On an ongoing basis, we review our estimates to ensure that they appropriately reflect changes in the business or as new information becomes available. Actual results may differ from these estimates.

*Research and Development Expenses*

Research and development expenses consist of costs incurred for internal projects, as well as partner-funded collaborative research and development activities. These costs include direct and research-related overhead expenses, which include salaries, stock-based compensation and other personnel-related expenses, facility costs, supplies, depreciation of facilities and laboratory equipment, as well as research consultants and the cost of funding research at universities and other research institutions, and are expensed as incurred. Costs to acquire technologies that are utilized in research and development that have no alternative future use, are expensed when incurred. In accordance with Accounting Standards Codification ("ASC") 730-20, we account for upfront, non-refundable research and development payments received from a related party as a long-term liability as there has not been a substantive and genuine transfer of risk and there is a presumption that we are obligated to repay the related party.

*Equity-Based Awards*

We grant equity-based awards (typically stock options or restricted stock units) under our stock-based compensation plan and occasionally outside of our stock-based compensation plan, with terms generally similar to the terms under our stock-based compensation plan. We estimate the fair value of stock option awards using the Black-Scholes option valuation model. For employees, directors and consultants, the fair value of the award is measured on the grant date. The fair value amount is then recognized over the period during which services are required to be provided in exchange for the award, usually the vesting period. The Black-Scholes option valuation model requires the input of subjective assumptions, including price volatility of the underlying stock, risk-free interest rate, dividend yield, and expected life of the option. We estimate the fair value of restricted stock unit awards based on the closing price of the Company's common stock on the date of grant.

*Leases*

We determine if an arrangement is a lease at inception. Operating lease right of use ("ROU") assets represent our right to use an underlying asset during the lease term, and operating lease liabilities represent our obligation to make lease payments arising from the lease. Operating leases are included in ROU assets, current operating lease liabilities, and long-term operating lease liabilities on our consolidated balance sheets.

Lease ROU assets and lease liabilities are initially recognized based on the present value of the future minimum lease payments over the lease term at commencement date calculated using our incremental borrowing rate applicable to the lease asset, unless the implicit rate is readily determinable. ROU assets also include any lease payments made at or before lease commencement and exclude any lease incentives received. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Leases with a term of 12 months or less are not recognized on the consolidated balance sheets. Our leases do not contain any residual value guarantees. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. We account for lease and non-lease components as a single lease component for all its leases.

***Recent Accounting Pronouncements***

Information regarding recent accounting pronouncements is contained in Note 2 to our condensed consolidated financial statements included in this report.

**ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.**

Not applicable.

**ITEM 4. CONTROLS AND PROCEDURES.**

**Evaluation of Disclosure Controls and Procedures**

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports we file or submit under the Securities Exchange Act of 1934, as amended, or Exchange Act, is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission, or the SEC, and that such information is accumulated and communicated to our management, including our Principal Executive Officer and Principal Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures reflects the fact that there are resource constraints and that management is required to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

As required by Rule 13a-15(b) under the Exchange Act, our management, under the supervision and with the participation of our Principal Executive Officer and our Principal Financial Officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures as of January 31, 2023. Based on such evaluation, our Principal Executive Officer and Principal Financial Officer concluded that, as of January 31, 2023, our disclosure controls and procedures were effective.

**Changes in Internal Control Over Financial Reporting**

There were no changes in our internal control over financial reporting during our fiscal quarter ended January 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II—OTHER INFORMATION**

**ITEM 1. LEGAL PROCEEDINGS.**

From time to time, we are involved in legal proceedings in the ordinary course of our business. Refer to Note 8: Commitments and Contingencies for more information on legal proceedings.

**ITEM 1A. RISK FACTORS.**

There have been no material changes in our risk factors from those disclosed in Part I, Item 1A to our Annual Report on Form 10-K for the fiscal year ended July 31, 2022, except as noted below. The risk factors disclosed in Part I, Item 1A to our Annual Report on Form 10-K for the fiscal year ended July 31, 2022, in addition to the other information set forth in this report, could materially affect our business, financial condition, or results of operations.

***If we fail to satisfy the Nasdaq's minimum stockholders' equity requirement of $2.5 million, our common stock will be delisted from Nasdaq, which could have an adverse impact on the liquidity and market price of our securities.***

On December 27, 2022, we received a notice from Nasdaq indicating that we are not in compliance with Nasdaq Listing Rule 5550(b)(1), which requires companies listed on Nasdaq to maintain a minimum of $2.5 million in stockholders' equity for continued listing. We reported a stockholders' deficit of approximately $5.5 million in our quarterly report on Form 10-Q for the period ended January 31, 2023, and, as a result, do not currently satisfy Listing Rule 5550(b)(1). The notice has no immediate impact on the listing of our Common Stock, which will continue to be listed and traded on Nasdaq, subject to our compliance with the other continued listing requirements. The notice provided us with 45 calendar days, or until February 10, 2023, to submit a plan to regain compliance. The Company submitted such plan to Nasdaq on February 10, 2023, and on February 21, 2023, the Company received a notice from Nasdaq that it has granted 180 calendar days from December 27, 2022, or June 26, 2023, to regain compliance. There can be no assurance that we will be able to regain compliance with all applicable continued listing requirements. In the event we fail to regain compliance within the compliance period, we would have the right to a hearing before an independent panel. The hearing request would halt any suspension or delisting action pending the conclusion of the hearing process and the expiration of any additional extension period granted by the panel following the hearing.

If we are unable to obtain regain compliance with a minimum $2.5 million in stockholders' equity by June 26, 2023 or fail to satisfy any of the other continued listing requirements, Nasdaq may take steps to delist our common stock. Such a delisting would likely have an adverse effect on the market liquidity of our securities, decrease the market price of our securities, result in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities, and adversely affect our ability to obtain financing for the continuation of our operations.

 ****

***The terms of the Convertible Note may have a negative impact on our business and the value of our securities and may result in substantial dilution to our other equity securityholders.***

The Convertible Note provides for certain terms that may have a negative impact on our business. Our obligations under the Convertible Note mature on November 25, 2025. The obligations under the Convertible Note are secured and the lenders thereunder will have a claim against right, title and interest, in and to certain of the Company's intellectual property rights in Hong Kong, Taiwan, China and South Korea, as specified in the Convertible Note. If we are unable to make the necessary payments, we will be in default under the terms of the Convertible Note. As a result, the noteholders would be able to foreclose on their security interests in our intellectual property. An event of default would adversely affect our business, financial condition, results of operations and prospects. Additionally, the Convertible Notes are convertible into common stock, subject to certain terms and conditions, which may result in dilution to our other equity securityholders.

 ****

***We will be subject to delisting from Nasdaq if we are unable to comply with the independence requirements for our Board and our Board committees.***

Prior to the closing of the Offering in December 2022, we qualified as a "controlled company" and availed ourselves of certain "controlled company" exemptions under the Nasdaq corporate governance rules. As a controlled company, we were not required to have a majority of "independent directors" on our Board as defined under the Nasdaq rules, or have a compensation, nominating or governance committee composed entirely of independent directors. In light of our prior status as a controlled company, our Board had determined to utilize the majority board independence exemption and the exemption applying to compensation committee member independence.

Since the closing of the Offering, we no longer qualify as a "controlled company" and, subject to cure periods, we are required to have a majority of our directors be "independent directors," as defined by Nasdaq rules, by December 1, 2023. If we are unable to comply with this requirement, we will be subject to delisting from Nasdaq, which could have an adverse impact on the liquidity and market price of our securities.

***Provisions of Our common warrants could discourage an acquisition of us by a third party.***

Certain provisions of the common warrants that we issued in the Offering could make it more difficult or expensive for a third party to acquire us. The common warrants prohibit us from engaging in certain transactions constituting "fundamental transactions" unless, among other things, the surviving entity assumes our obligations under the common warrants. Further, the common warrants provide that, in the event of certain transactions constituting "fundamental transactions," with some exception, holders of such warrants will have the right, at their option, to require us to redeem such common warrants for cash at a price described in such warrants. These and other provisions of the common warrants could prevent or deter a third party from acquiring us.

**ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.**

Not applicable.

**ITEM 3. DEFAULTS UPON SENIOR SECURITIES.**

None.

**ITEM 4. MINE SAFETY DISCLOSURES.**

None.

**ITEM 5. OTHER INFORMATION.**

None.

**ITEM 6. EXHIBITS.**

The following exhibits are either filed or furnished with this report:

---

| | |
|:---|:---|
| 3.1 | [Articles of Incorporation of OncoSec Medical Incorporated, as amended (incorporated by reference to Exhibit 3.1 of our Annual Report on Form 10-K, filed on October 25, 2017).](https://www.sec.gov/Archives/edgar/data/1444307/000149315217012058/ex3-1.htm) |
| 3.2 | [Certificate of Change to amend the Articles of Incorporation of OncoSec Medical Incorporated, as filed with the Nevada Secretary of State on May 20, 2019 (incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K, filed on May 20, 2019).](https://www.sec.gov/Archives/edgar/data/1444307/000149315219007911/ex3-1.htm) |
| 3.3 | [Certificate of Change to amend the Articles of Incorporation of OncoSec Medical Incorporated, as filed with the Nevada Secretary of State on September 6, 2019 (incorporated by reference to Exhibit 3.4 on our Annual Report on Form 10-K, filed on October 25, 2019).](https://www.sec.gov/Archives/edgar/data/1444307/000149315219016036/ex3-4.htm) |
| 3.4 | [Certificate of Amendment of Amended and Restated Articles of Incorporation of OncoSec Medical Incorporated (incorporated by reference to Exhibit 3.1 on our Current Report on Form 8-K, filed on May 29, 2020).](https://www.sec.gov/Archives/edgar/data/1444307/000149315220010178/ex3-1.htm) |
| 3.5 | [Certificate of Change to amend the Articles of Incorporation of OncoSec Medical Incorporated, as filed with the Nevada Secretary of State on November 1, 2022 (incorporated by reference to Exhibit 3.1 of our Current Report on Form 8-K, filed on November 8, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222030921/ex3-1.htm) |
| 3.6 | [Certificate of Amendment to the Articles of Incorporation, as amended, of OncoSec Medical Incorporated (incorporated by reference to Exhibit 3.1 on our Current Report on Form 8-K, filed on January 4, 2023).](https://www.sec.gov/Archives/edgar/data/1444307/000149315223000320/ex3-1.htm) |
| 4.1 | [Form of Pre-Funded Warrant (incorporated by reference to Exhibit 4.1 of our Current Report on Form 8-K, filed December 1, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222034187/ex4-1.htm) |
| 4.2 | [Form of Common Stock Purchase Warrant (incorporated by reference to Exhibit 4.2 of our Current Report on Form 8-K, filed December 1, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222034187/ex4-2.htm) |
| 10.1 | [Lease Agreement, dated September 6, 2022, between OncoSec Medical Incorporated and Mountain View Office Park, L.L.C. (incorporated by reference to Exhibit 10.26 of our Registration Statement on Form S-1 (File No. 333-269517), filed on February 1, 2023).](https://www.sec.gov/Archives/edgar/data/1444307/000149315223003322/ex10-26.htm) |
| 10.2 | [Convertible Promissory Note and Security Agreement, dated November 25, 2022, by and between OncoSec Medical Incorporated and Grand Decade Developments Limited (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K, filed on November 29, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222033888/ex10-1.htm) |
| 10.3 | [Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 of our Current Report on Form 8-K, filed December 1, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222034187/ex10-1.htm) |
| 10.4 | [Placement Agency Agreement, dated November 30, 2022, by and between the Company and between A.G.P./Alliance Global Partners (incorporated by reference to Exhibit 10.2 of our Current Report on Form 8-K, filed December 1, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222034187/ex10-2.htm) |
| 10.5 | [Form of Voting Agreement (incorporated by reference to Exhibit 10.3 of our Current Report on Form 8-K, filed December 1, 2022).](https://www.sec.gov/Archives/edgar/data/1444307/000149315222034187/ex10-3.htm) |
| 31.1\* | [Certification of Chief Executive Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934](ex31-1.htm) |
| 31.2\* | [Certification of Principal Financial Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of 1934](ex31-2.htm) |
| 32.1\*\* | [Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex32-1.htm) |
| 32.2\*\* | [Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002](ex32-2.htm) |
| 101.INS\* | Inline XBRL Instant Document |
| 101.SCH\* | Inline XBRL Taxonomy Extension Schema Document |
| 101.CAL\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
| 101.DEF\* | Inline XBRL Taxonomy Extension Definition Linkbase Document |
| 101.LAB\* | Inline XBRL Taxonomy Extension Label Linkbase Document |
| 101.PRE\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
| 104\* | Cover Page Interactive Data File (embedded within the Inline XBRL document in Exhibit 101) |

---

\* Filed herewith.

\*\* Furnished herewith.

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | |
|:---|:---|
| **ONCOSEC MEDICAL INCORPORATED** | **ONCOSEC MEDICAL INCORPORATED** |
| By: | */s/ Robert H. Arch, Ph.D.* |
|  | Robert H. Arch, Ph.D. |
|  | *President and Chief Executive Officer* |
|  | (*Principal Executive Officer*) |
| Dated: March 13, 2023 | Dated: March 13, 2023 |
| By: | */s/ George Chi* |
|  | George Chi |
|  | *Chief Financial Officer* |
|  | (*Principal Financial Officer*) |
| Dated: March 13, 2023 | Dated: March 13, 2023 |

---

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATIONS**

I, Robert H. Arch, Ph.D., certify that:

1. I
 have reviewed this Quarterly Report on Form 10-Q of OncoSec Medical Incorporated;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
 (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
 Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

(b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

(d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
 or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The
 registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over
 financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or
 persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

(b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

March 13, 2023

---

| |
|:---|
| */s/ Robert H. Arch, Ph.D.* |
| Robert H. Arch, Ph.D. |
| *Chief Executive Officer* |
| *(Principal Executive Officer)* |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATIONS**

I, George Chi, certify that:

1. I
 have reviewed this Quarterly Report on Form 10-Q of OncoSec Medical Incorporated;

2. Based
 on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary
 to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to
 the period covered by this report;

3. Based
 on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
 respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in
 this report;

4. The
 registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures
 (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange
 Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Designed
 such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision,
 to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others
 within those entities, particularly during the period in which this report is being prepared;

(b) Designed
 such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
 supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
 for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated
 the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about
 the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
 and

(d) Disclosed
 in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
 most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected,
 or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The
 registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over
 financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or
 persons performing the equivalent functions):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) All
 significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
 reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information;
 and

(b) Any
 fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's
 internal control over financial reporting.

March 13, 2023

---

| |
|:---|
| */s/ George Chi* |
| George Chi |
| *Chief Financial Officer* |
| *(Principal Financial Officer)* |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER<br> PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

The undersigned, Robert H. Arch, Ph.D., Chief Executive Officer (Principal Executive Officer) and President of OncoSec Medical Incorporated (the "Company"), hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) the
 Quarterly Report on Form 10-Q of the Company for the period ended January 31, 2023 (the "Report") fully complies with
 the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2) the
 information contained in the Report fairly presents, in all material respects, the financial condition and results of operations
 of the Company.

---

| | | |
|:---|:---|:---|
| Dated: March 13, 2023 | By: | */s/ Robert H. Arch, Ph.D.* |
|  |  | Robert H. Arch, Ph.D. |
|  |  | *Chief Executive Officer and President* |
|  |  | (*Principal Executive Officer*) |

---

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER<br> PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

The undersigned, George Chi, Chief Financial Officer (Principal Financial Officer) of OncoSec Medical Incorporated (the "Company"), hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) the
 Quarterly Report on Form 10-Q of the Company for the period ended January 31, 2023 (the "Report") fully complies with
 the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2) the
 information contained in the Report fairly presents, in all material respects, the financial condition and results of operations
 of the Company.

---

| | | |
|:---|:---|:---|
| Dated: March 13, 2023 | By: | */s/ George Chi* |
|  |  | George Chi |
|  |  | *Chief Financial Officer*<br>|
|  |  | (*Principal Financial Officer*) |

---