Innovation Pharmaceuticals Inc (IPIX)

[PJ007]

Great Summary by Mo.....thank you

Thoughts on the IPIX 10-K.

Cash Position - $11.3M cash as of 9/22/21 with a projected budget of $10.2M ($8.2M of this for clinical trials) thru 6/30/22.

Outstanding Shares (OS) – Current OS at 437,096,222 as of 9/22/21. Dilution has been minimal in last 7 ½ months since 2/10/21 when OS was 418,069,575. Most of the 19M additional OS took place since 6/30/21. Note that in the 4 ½ months between 2/10//21 and 6/30/21 OS expanded a grand total of 87,567 shares which is close to IPIX’s DAILY volume average during that period. The obvious question is where did the supply come from to facilitate trades for the other 94 trading days or approximate 8M shares traded during that time? Most Longs are holding very tight so my guess is some spoofed volume from the MMs and a significant amount added to an already very deep NSS hole that the hedge funds have dug and they consider this as a rounding error.

B-CV19 - Trial data is still blinded. Interesting that a 2nd DMC interim review was held in July after all trial patients had been treated. My guess is the FDA did this additional safety validation in anticipation that they would soon be issuing Compassionate Use approval for Brilacidin for severe and critically ill CV19 patients. Top Line data is expected late October per the latest IPIX PR.

B-CV19 Funding - RBL research grant funding is pending. Further (additional) grant application for fed funded research pending. Further grant applications are planned. Additionally, the Coronavirus Treatment Acceleration Program (CTAP) was mentioned as program that IPIX intended to utilize. The way I interpreted the 10-K is that there are at least 3 separate government grant options that IPIX is applying for. Any or all of these could be a pathway for Brilacidin approval. This does not include any additional potential BP license agreements or BP Up Front funding which I personally believe will happen soon after successful B-CV19 trial results are announced.

Alfasigma B-IBD UP/UPS – Alfasigma successfully completed a phase 1 in Q1 for their Brilacidin based proprietary formulation for B-IBD UP/UPS. Alfasigma is taking delivery of Brilacidin in Q4 as the basis for a Phase 2 multinational
B-IBD UP/UPS trial in early 2022.

B-OM – Development of an optimized oral rinse formulation is in progress. Brilacidin API (active pharmaceutical ingredient) ordered for delivery in January 2022, for use in planned 2022 B-OM Phase 3.

B-IBD UC – Oral delivery Phase 2 POC in preparation. Inclusion of a Phase 1 testing for an immediate-release pill scheduled in January 2022.

B-ABSSSI – Funding needed to advance this area which may provide significant opportunities in treating infectious disease and enabling further studies for Brilacidin use in implant coating and biofilm infections.

Kevetrin – Short half-life of 2 hours makes a compelling case for multiple daily treatments. Oral delivery is needed to leverage this. Toxicology studies for oral delivery are approximately 50% complete. Any type of funding windfall would accelerate Kevetrin advancement which requires funding to proceed.

Summary

Net/net a variety of science advancement planned with adequate funding for the next 3 or 4 quarters. Science development and trial timelines would greatly accelerate if Leo can negotiate non-dilutive funding. Successful CV19 trial results will likely be followed up with at least one source of funding in Q4 IMO. These events will have a huge impact on IPIX SP. Q1 could include B-CV19 EUA and associated revenue, IPIX stock Up Listing and trial initiation for B-OM phase 3, B-IBD UC phase 2 and Alfasigma B-IBD UP/UPS Phase 2. All of these milestones will each contribute towards furthering IPIX SP momentum. IMO a major stockpile of hedge fund naked short shares has now ironically become an IPIX shareholder asset. Once the hedge funds are forced to initiate the covering of their NSS position, the unravelling will accelerate IPIX SP upward from an already ignited SP fueled by science advancement. It should be a rewarding next 12 months for IPIX shareholders with the major catalyst of B-CV19 trial success announcement only weeks away.