Innovation Pharmaceuticals Inc (IPIX)

[TOB]

It is good news for Cellceutix as now their favourable fund raising plan can proceed.

This clause from the 10-Q filed the day before becomes defunct. The SEC has declared the registration effective, which while expected, could have taken much longer and delayed the Cellceutix's plans.

The Company will be unable to proceed with its full planned drug development program (s), meet its administrative expense requirements, capital costs, or staffing costs without obtaining additional financing of approximately $6,350,000 (as per current management’s budgets). The Company has entered into a $10,000,000 financing agreement with Aspire Capital Fund. We do not have the right to commence any sales of our shares to Aspire Capital until the SEC has declared the registration statement effective. (SEE Liquidity and Capital Resources) If the SEC doesn’t declare our registration effective, or we are unable to obtain additional financing on terms and conditions acceptable to the Company, our business plan will be significantly delayed. 10-Q

So no delay in the business plan for the coming year.

Never possible to guess market price reaction of course, but those watching the fundamentals of CTIX will have to note that Cellceutix now has the ability to raise more than the money it needs this year. That doubt is removed.

Requirement for Additional Capital

Research and Development Costs. The Company has engaged in limited research and development activities. We currently do not have sufficient funds to meet our planned drug development for the next twelve (12) months and we may not be able to obtain the necessary financing on terms and conditions acceptable to the Company. Assuming that we are successful in raising additional financing, we plan to incur the following expenses over the next twelve (12) months:

1. Research and Development- $2,000,000 in preclinical development costs, including testing Kevetrin on additional tumors and costs to manufacture Prurisol.

2. Clinical trials – $3,000,000. We have budgeted $1,500,000 for our Phase 1 Kevetrin trials and $1,500,000 for the Prurisol pilot study and phase 2/3 trials.

3. Corporate overhead of $1,250,000: Budgeted office salaries, legal, accounting and other costs expected to be incurred.

4. Capital costs of $100,000: Estimated cost for equipment and laboratory improvements.

So it is game on for the Prurisol and additional Kevetrin trials, and more preclinical research for Kevetrin.

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