UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 20212022

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 Number: 001-38355

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

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.  Yesþ☒  Noo

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 þ☒ No  No o

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.

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).

Yeso No☒☒

The number of shares of common stock, par value $0.001 per share, outstanding as of August 13, 20219, 2022 was 23,308,03924,102,866.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements, other than statements of historical fact, included in this Quarterly Report on Form 10-Q regarding development of our strategy, future operations, future financial position, projected costs, prospects, plans and objectives of management are forward-looking statements. Forward-looking statements may include, but are not limited to, statements about:

• any statements of the plans, strategies and objectives of management for future operations;
• any statements concerning proposed new products, services or developments;
• any statements regarding future economic conditions or performance;
• our ability to protect our intellectual property and operate our business without infringing upon the intellectual property rights of others;
• our estimates regarding the sufficiency of our cash resources and our need for additional funding;
• any statement that our business, financial condition and results of operations may be materially adversely affected by global health epidemics, including the recent COVID-19 pandemic; and
• any statement regarding the effectiveness of our continuous temperature monitoring system to assist with the diagnosis and monitoring of symptoms of COVID-19 or the effectiveness of our continuous lactate monitoring system (CLM) to monitor disease progression in COVID -19 patients.

The words "believe," "anticipate," "design," "estimate," "plan," "predict," "seek," "expect," "intend," "may," "could," "should," "potential," "likely," "projects," "continue," "will," and "would" and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements reflect our current views with respect to future events, are based on assumptions and are subject to risks and uncertainties. We cannot guarantee that we actually will achieve the plans, intentions or expectations expressed in our forward-looking statements and you should not place undue reliance on these statements. There are a number of important factors that could cause our actual results to differ materially from those indicated or implied by forward-looking statements. These factors and the other cautionary statements made in this Quarterly Report on Form 10-Q should be read as being applicable to all related forward-looking statements whenever they appear herein. Except as required by law, we do not assume any obligation to update any forward-looking statement. We disclaim any intention or obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

NEMAURA MEDICAL INC.

INDEX TO QUARLTERLY REPORT ON FORM 10-Q

FOR THE PERIOD ENDED JUNE 30, 2021

TABLE OF CONTENTS

PART I – FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

See notes to the unaudited condensed consolidated financial statements.

See notes to the unaudited condensed consolidated financial statements.

NEMAURA MEDICAL INC.

Condensed Consolidated Statements of Changes in Stockholders’ Equity (deficit)

Three Months Ended June 30, 2022 and 2021 (Unaudited)

See notes to the unaudited condensed consolidated financial statements.

NEMAURA MEDICAL INC.

Condensed Consolidated Statements of Changes in Stockholders’ Equity

Three Months Ended June 30, 2021 and 2020 (Unaudited)

See notes to the unaudited condensed consolidated financial statements.

See notes to the unaudited condensed consolidated financial statements.

NEMAURA MEDICAL INC.

Notes to Condensed Consolidated Financial Statements

(Unaudited)

NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES

Nemaura Medical Inc. (“Nemaura” or the “Company”), through its operating subsidiaries, performs medical device research and manufacturing of a continuous glucose monitoring system (“CGM”), named sugarBEAT®. The sugarBEAT® device is a non-invasive, wireless device for use by persons with Type I and Type II diabetes and may also be used to screen pre-diabetic patients. The sugarBEAT® device extracts analytes, such as glucose, to the surface of the skin in a non-invasive manner where it is measured using unique sensors and interpreted using a unique algorithm.

Nemaura is a Nevada holding company organized in 2013. Nemaura owns 100% owns 100% of the stock in Dermal Diagnostic (Holdings) Limited, an England and Wales corporation (“DDHL”) formed on December 11, 2013, which in turn owns 100% of Dermal Diagnostics Limited, an England and Wales corporation formed on January 20, 2009 (“DDL”), and 100% of Trial Clinic Limited, an England and Wales corporation formed on January 12, 2011 (“TCL”).

DDL is a diagnostic medical device company headquartered in Loughborough, Leicestershire, England, and is engaged in the discovery, development, and commercialization of diagnostic medical devices. The Company’s initial focus has been on the development of the sugarBEAT® device, which consists of a disposable patch containing a sensor, and a non-disposable miniature wireless transmitter with a re-chargeable power source, which is designed to enable trending or tracking of blood glucose levels. WhileAll of the Company’s key operations and assets are located in England, the Company has recently commenced commercial operations in the United States.England.

During the fiscal year ended March 31, 2021, the Board of Directors assessed the adequacy of the group’s organizational structure and concluded that the intermediate holding company that sat below Nemaura Medical Inc., Region Green Limited (a British Virgin Islands corporation), was no longer required as the entity had been effectively dormant since inception and no longer represented a requirement to be maintained. It was therefore determined that Region Green Limited should be unwound, with the intention that the assets held by Region Green Limited be transferred up to Nemaura Medical Inc. following which Region Green Limited would be dissolved.

The transfer of assets took place on March 5, 2021 and Region Green Limited was formally dissolved as of April 23, 2021.

The following diagram illustrates Nemaura’s corporate structure as of June 30, 2021:2022:

The Company was incorporated in 2013 and has reported recurring losses from operations to date and an accumulated deficit of $27,188,39641,710,773 as of June 30, 2021. 2022. These operations have resulted in the successful completion of clinical programs to support a CE mark (European Union approval of the product) approval, andas well as a Pre-Market Application (“PMA”)De Novo 510(k) medical device application to the U.S. Food and Drug Administration (“FDA”) for sugarBEAT® is currently under reviewsubmission..

The Company expects to continue to incur losses from operations until revenues are generated through licensing fees or product sales. However, given the completion of the requisite clinical programs, these losses are expected to decrease over time. Management has entered into licensing, supply, or collaboration agreements with unrelated third parties relating to the United Kingdom (“UK”), Europe, Qatar, and all countries in the Gulf Cooperation Council.

Going Concern

As identified under Item 1A, Management is aware of the need to raise additional funds in order to finance the ongoing commercialization of sugarBEAT®. The Company hashad $31,259,75314,751,833 of readily available cash at June 30, 2021,2022, however the terms of the existing debt held on balance sheet will fall due for repayment as of February 2023, which will trigger a requirement to either restructure the debt or obtain additional, new, funding. 

In evaluating the going concern position of the Company, Management has considered the ability of the Company to raise additional funding in combination with one or more of the different funding options available to it at this time.  Based on current and ongoing engagement with potential funding providers, management has evaluatedbelieves that there is a reasonable expectation that funding could be provided by one, or more, of the expected expenses to be incurred in relation to its available cash and has determined thatfollowing options:

Equity funding – the Company has immediate access to funds through the ATM facility that is currently in place; in addition to this, there are various alternative mechanisms available to the Company similar to those used previously e.g. direct sale of shares to interested third parties, similar to the stake sold to Tiger Trading Partners L.L.C. in February 2022, as well as other mechanisms to sell common stock via an underwritten agreement or the further exercise of warrants by the current warrant holders etc.

Debt funding – the Company continues to be in ongoing discussions with third party debt providers, including the incumbent, to enable the existing debt facility to be restructured or renewed, should Management feel that this route offers a more attractive option compared to the sale of equity that is dependent on the current market conditions.

Alternative funding as used in the past such as the sale of licenses.  As product development is now at a significant more advanced stage then it was, it is Management’s belief that the sufficient funding could be provided through the sale of licenses in a similar way to the UK license agreement sale that help provided early-stage development funding.

However, as a consequence of this funding requirement being triggered without the funding bridge having been put in place by the filing date of these unaudited condensed consolidated financial statements, ASC 205-40 requires that Management recognize and disclose this point as an event which creates a substantial doubt as to the Company’s ability to continue as a going concern for at least one year subsequent tofrom the date of issuancefiling of these unaudited condensed consolidated financial statements.

Following the receipt of the CE mark approval in the EU, and in support of our plans for similar certification with the FDA in the U.S., our plan is to utilize the cash on hand to continue establishing commercial manufacturing operations for the commercial supply of the sugarBEAT® device and sensor patches in our target markets.

Management's strategic plans include the following:

NOTE 2 – BASIS OF PRESENTATION

(a)    Basis of presentation

The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”), and do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. However, such information reflects all adjustments consisting of normal recurring accruals which are, in the opinion of management, necessary for a fair statement of the financial condition and results of operations for the interim periods. The results for the three months ended June 30, 20212022 are not indicative of annual results. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. It is suggested that theseThese unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended March 31, 2021,2022, as filed with the SEC.

The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and the Company’s subsidiaries. References to “we”, “us”, “our”, or the “Company” refer to Nemaura Medical Inc. and its consolidated subsidiaries. The unaudited condensed consolidated financial statements are prepared in accordance with U.S. GAAP, and all significant intercompany balances and transactions have been eliminated in consolidation.

The functional currency for the majority of the Company’s operations is the Great Britain Pound Sterling (“GBP”), and the reporting currency is the U.S. Dollar (“USD”).

Derivative Financial Instruments

Derivative financial instruments are used as part of the overall strategy to manage exposure to foreign currency primarily associated with fluctuations in foreign currency exchange rates. Derivative financial instruments are included in the consolidated balance sheets and are measured at fair value on a recurring basis.

The Company is exposed to the impact of foreign currency exchange fluctuations as a significant proportion of our expenses are incurred within our UK subsidiary which is denominated in Great Britain Pounds Sterling (“GBP”), with the remaining portion denominated in U.S. dollars and a small amount in Euro’s (“EUR”). In addition to this we hold the majority of our cash in USD, with amounts also held in GBP and, to a much smaller amount, in EUR’s. The Company’s objective is to reduce the volatility associated with these foreign exchange rate changes to allow management to focus our attention on our core business strategy and objectives. Accordingly, during the three month period ended June 30, 2021 the Company entered into a target accrual redemption forward contract (“TARF”) agreement to sell USD and buy GBP across 25 defined monthly fixings, in order to fix the costs associated with the foreign currency exchange fluctuations associated with its GBP denominated expenses. These fixings allow for $250,000 to be converted to GBP at a fixed rate of $1.369 subject to the spot rate on the fixing date being above the fixed rate. Should the spot rate fall below the fixed rate on the scheduled fixing date, the Company is obligated to convert $500,000 to GBP at the fixed rate. The exchange rate range experienced by the company over the last 2 years for USD : GBP has seen a high of approximately $1.163 in March 2020 and a low of approximately $1.423 in June 2021. Cumulative profit on the sale of USD is capped at an aggregate of approximately $55,000 over the shorter of the life of the contract fixings or the utilization of the cap.

At June 30, 2021, the Company held a forward contract to sell up to $12.5 million, which when remeasured at fair value generated a loss of $63,068 which has been captured within the other comprehensive loss for the period. No such similar derivative financial instrument was in place at March 31, 2021 or June 30, 2020.

The Company’s foreign currency forward contracts are measured at fair value on a recurring basis and are classified as Level 2 under our fair value of financial instruments policy, as set out in the March 31, 2021 Form 10-K.

There have been no other material changes to our significant accounting policies from those detailed in the Company’s Annual Report on Form 10-K for the year ended March 31, 2021, as filed with the SEC on June 29, 2021.

(c)Recently adopted accounting pronouncements

The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of the change to its consolidated financial statements and assures that there are proper controls in place to ascertain that the Company's consolidated financial statements properly reflect the change.

This Quarterly Report on Form 10-Q does not discuss recent pronouncements that are not anticipated to have a current and/or future impact on the Company, or are unrelated to the Company’s financial condition, results of operations, cash flows or disclosures.

NOTE 3 – LICENSING AGREEMENTS

United Kingdom and the Republic of Ireland, the Channel Islands, and the Isle of Man

In March 2014, the Company entered into an Exclusive Marketing Rights Agreement (the “Marketing Rights Agreement”) with an unrelated third party (the “Licensee”), that granted to the Licensee the exclusive right to market and promote the sugarBEAT® device and related patches under its own brand in the United KingdomUK and the Republic of Ireland, the Channel Islands, and the Isle of Man. The Company received a non-refundable, up-front cash payment of GBP 1,000,000 (approximately $1.381.20 million and $1.38 1.31million as of June 30, 20212022 and March 31, 2021,2022, respectively), which is wholly non-refundable, upon signing the Marketing Rights Agreement. The upfront payment received from the Marketing Rights Agreement has been deferred and will be recorded as income over the term of the Marketing Rights Agreement.Agreement, which commenced upon the first delivery of the sugarBEAT® device to the Licensee in December 2021. Consequently, approximately $115,000178,000, and $103,000259,000 of theis included in deferred revenue has been classified as a current liability as of June 30, 20212022 and March 31, 2021, respectively.

The Company is in ongoing dialogue2022, respectively, with the Licensee about the timing of its plans with respect to its product launch. The current expectation is for this to occurremainder being shown in the quarter ending December 31, 2021, with the initial order placed with the Company in April 2021 being scheduled to commence delivery during the quarter ending September 30, 2021, in order to enable the Licensee to hold inventory on-hand to support their launch. Under the termsnon-current portion of the contact, the Company is able to issue a ‘deposit’ invoice to cover costs for purchases directly incurred in order to service orders made by the Licensee, as such an invoice was raised at the end of the quarter for approximately $513,000 and will be recorded as income once delivery of the order commences. As at June 30, 2021 this invoice has been treated as deferred revenue within current liabilities with the debit balance being captured within other receivables, the cash payment for which is anticipated in line with the agreed standard contractual terms.revenue.

NOTE 4 – RELATED PARTY TRANSACTIONS

Nemaura Pharma Limited (“Pharma”), NDM Technologies Limited (“NDM”) and Black and White Health Care Limited (“B&W”) are entities controlled by the Company’s Chief Executive Officer, President, interim Chief Financial Officer, director and majority stockholder, Dewan F.H. Chowdhury. While transactions occurred during the period between the Company and Pharma, no transactions were recorded with NDM or B&W.

These unaudited condensed consolidated financial statements are intended to reflect all costs associated with the operations of DDL and TCL. Pharma has a service agreement with DDL to undertake development, manufacture, and regulatory approvals under Pharma’s ISO13485 accreditation. In lieu of these services, Pharma invoices DDL on a periodic basis for said services. Services are provided at cost plus a service surcharge amounting to less than 10% of the total costs incurred.

The table below provides a summary of activity between the Company and Pharma and NDM for the three months ended June 30, 20212022 and 2020,2021, and the year ended March 31, 2021.2022.

The Company routinely reviews its condensed consolidated statements of cash flows presentation of related party transactions for financing or operating classification based on the underlying nature of the item and intended repayment.

NOTE 5 – NOTES PAYABLE

NOTE PURCHASE AGREEMENT 1

On April 15, 2020, the Company entered into a note purchase agreement (the “Note Purchase Agreement 1”) by and among the Company, DDL, TCL and a third-party investor (the “Investor”).

Pursuant to the terms of the Note Purchase Agreement 1, the Company agreed to issue and sell to the Investor, and the Investor agreed to purchase from the Company, a secured promissory note (the “Secured“2020 Secured Note”) in the original principal amount of $6,015,000. In consideration thereof, on April 15, 2020, (the closing date), (i) the Investor (a) paid $1,000,000 in cash, (b) issued to the Company (1) Investor Note #1 in the principal amount of $2,000,000 (“Investor Note #1”), and (2) Investor Note #2 in the principal amount of $2,000,000 (“Investor Note #2” and together with Investor Note #1, the “Investor“2020 Investor Notes”), and (ii) the Company delivered the 2020 Secured Note on behalf of the Company, to the Investor, against delivery of the 2020 Purchase Price. For these purposes, the “Purchase“2020 Purchase Price” means the Investor’s initial cash purchase price, together with the sum of the initial principal amounts of the Investor Notes.

The 2020 Secured Note is secured by the Collateral (as hereinafter defined). The 2020 Secured Note carries an original issue discount (“OID”) of $1,000,000 (16.7%). In addition, the Company agreed to pay $15,000 to the Investor to cover the Investor’s legal fees, accounting costs, due diligence, monitoring and other transaction costs incurred in connection with the purchase and sale of the 2020 Secured Note (the “Transaction Expense Amount”). In addition to this, a payment of $325,000 was made to Ascendiant Capital Markets, LLC (the “Commission”(“Ascendiant”) for structuring the agreement between both parties. The 2020 Purchase Price for the 2020 Secured Note is $4,675,000, computed as follows: $6,015,000$6,015,000 original principal balance, less: OID, Transaction Expense Amount, and commission paid.

The borrowing period is 24 months, and the Company shall pay the outstanding balance and all fees on maturity. A monitoring fee equal to 0.833% of the outstanding balance will automatically be added to the outstanding balance on the first day of each month. The debt less the discount and transaction expenses will be accreted over the term of the 2020 Secured Note using the effective interest method.

Security Agreement

On April 15, 2020, the Company entered into the Security Agreement by the Company, DDL and TCL, in favor of the Investor (the “Security“2020 Security Agreement”). Pursuant to the terms of the 2020 Security Agreement, the Company granted the Investor a first-priority security interest in all rights, title, interest, claims and demands of the Company in and to all of the Company’s patents and all other proprietary rights, and all rights corresponding to the Company’s patents throughout the world, now owned and existing, and all replacements, proceeds, products, and accessions thereof.thereof (the “Collateral”).

Note 1 was settled in full on April 22, 2022.

NOTE PURCHASE AGREEMENT 2

On February 8, 2021, the Company entered into an additional note purchase agreement (“Note Purchase Agreement 2”) with the Investor.  Pursuant to the terms of Note Purchase Agreement 2, the Company agreed to issue and sell to the Investor, and the Investor agreed to purchase from the Company, a secured promissory note (“Secured(the “Secured Note 2”) in the original principal amount of $24,015,000. The Secured Note 2 carries an OID of $4,000,000 (16.7%(16.7%), and the Company agreed to pay $15,000$15,000 to the Investor to cover the Investor’s transaction expenses. In addition to this, a Commissioncommission of $1,200,000$1,200,000 was also payable to Ascendiant Capital Partners, LLC.Ascendiant.

In consideration thereof, on February 9, 2021, (the “closing date”), (i) the Investor paid $20,000,000 in cash to the Company, and (ii) the Company delivered Secured Note 2 on behalf of the Company, to the Investor, against the delivery of the 2021 Purchase Price.  For these purposes, the “Purchase“2021 Purchase Price” means the Investor’s initial cash purchase price. After adjusting for transaction expenses of $1,200,000, cash proceeds received were $18,800,000.

The borrowing terms for Note Purchase Agreement 2 are consistent with those of Note Purchase Agreement 1, with the borrowing period being 24 months from the date of the agreement, the Company being required to pay the outstanding balance and all fees on maturity, and a monitoring fee equal to 0.833% of the outstanding balance being automatically added to the outstanding balance on the first day of each month. The debt less discount and transaction expenses will be accreted over the term of the Secured Note 2 using the effective interest rate method.

Security Agreement

On February 8, 2021, the 2020 Security Agreement established in respect to Note Purchase Agreement 1 was extended to include Note Purchase Agreement 2, which is also secured against all of the Company’s assets owned as of the closing dateFebruary 9, 2021 and extends to any assets acquired at any time that the Company’s obligations under Secured Note 2 are outstanding.

NOTE PURCHASE AGREEMENT 3

On May 20, 2022, the Company entered into a new note purchase agreement (“Note Purchase Agreement 3”) by and among the Company , DDL, TCL and a third-party investor.

Pursuant to the terms of the Note Purchase Agreement 3, the Company agreed to issue and sell to the Investor and the Investor agreed to purchase from the Company a secured promissory note (the “Secured Note”) in the original principal amount of $6,015,000. In consideration thereof, on May 20, 2022 (the closing date), (i) the Investor paid $5,000,000 in cash, and (ii) the Company delivered the Secured Note on behalf of the Company, to the Investor, against delivery of the Purchase Price. For these purposes, the “Purchase Price” means the Investor’s initial cash purchase price.

The Secured Note is secured by the Collateral (as hereinafter defined). The Secured Note carries an original issue discount (“OID”) of $1,000,000 (16.7%). In addition, the Company agreed to pay $15,000 to the Investor to cover the Investor’s legal fees, accounting costs, due diligence, monitoring and other transaction costs incurred in connection with the purchase and sale of the Secured Note (the “Transaction Expense Amount”). In addition to this, a payment of $300,000 was made to Ascendiant Capital Markets, LLC, (the “Commission”) for structuring the agreement between both parties. The Purchase Price for the Secured Note is $4,700,000, computed as follows: $6,015,000 original principal balance, less: OID, Transaction Expense Amount, and commission paid.

The borrowing period is 24 months, and the Company shall pay the outstanding balance and all fees on maturity. A monitoring fee equal to 0.833% of the outstanding balance will automatically be added to the outstanding balance on the first day of each month. The debt less the discount and transaction expenses will be accreted over the term of the Note using the effective interest method.

Security Agreement

On May 20, 2022, the Company entered into the Security Agreement by the Company, DDL and TCL, in favor of the Investor (the “Security Agreement”). Pursuant to the terms of the Security Agreement, the Company granted the Investor a first-priority security interest in all rights, title, interest, claims and demands of the Company in and to all of the Company’s patents and all other proprietary rights, and all rights corresponding to the Company’s patents throughout the world, now owned and existing, and all replacements, proceeds, products, and accessions thereof.

As of June 30, 2021,2022, long-term debt matures as follows:

NOTE 6 – STOCKHOLDERS’ (DEFICIT) EQUITY

During the three month period ended June 30, 2022, 0 warrants were exercised, and 0 shares were issued.

During the three month period ended June 30, 2021, 366,892 warrants were exercised generating gross proceeds of $2,963,658. There was a total of 1,573,098warrants outstanding at this date. NoNaN other shares were issued during thisin the period.

During the three month period ended June 30, 2020, a total of 393,352 shares were issued, generating gross proceeds of $4,097,083 with associated costs of $122,913. $1,986,038 was received net of ATM financing costs through June 30, 2020 and $1,988,132 was presented as stock subscriptions receivable as of June 30, 2020 and was collected on July 1, 2020.

During the three month period ended June 30, 2020, 37,933 warrants were exercised, generating $394,475 in additional funds. At June 30, 2020 there were 147,637 warrants outstanding.

Loss per share

The following table sets forth the computation of basic and diluted loss per share for the periods indicated.

The Company excludes warrants outstanding, which are anti-dilutive given the Company is in a loss position, from the basic and diluted loss per share calculation.

Basic loss per share is computed by dividing loss available to common stockholders by the weighted-average number of common shares outstanding during the period. For the three month periodperiods ended June 30, 20212022, warrants to purchase1,573,098 shares of common stock and a unit purchase option to purchase 9,710 shares of common stock, as well as warrants to purchase 9,710 warrantsshares of common stock, were considered anti-dilutive and were excluded from the calculation of diluted loss per share. For the three month periodperiods ended June 30, 20202021, warrants to purchase 1,147,6371,940,740 shares of common stock and a unit purchase option to purchase 9,710 shares of common stock, as well as warrants to purchase 9,710 warrantsshares of common stock, were considered anti-dilutive and were also excluded from the calculation of diluted loss per share.

NOTE 7 –OTHER ITEMS

(a) COVID-19 Pandemic

The outbreak of COVID-19 originating in Wuhan, China, in December 2019 has since rapidly increased its exposure globally. On March 11, 2020, the World Health Organization declared the outbreak a pandemic. We continue to monitor the impact of COVID-19 on our own operations and are working with our employees, suppliers and other stakeholders to mitigate the risks posed by its spread, but COVID-19 is not expected to have any long-term detrimental effect on the Company’s success. While key suppliers have not been accessible throughout the whole period of the outbreak, we have been able to be flexible in our priorities and respond favorably to the challenges faced during the outbreak. We have also seen a surge in the uptake of technologies for remote patient monitoring of patients and patient self-monitoring, which potentially enhances the prospects for the Company, its CGM product and its planned digital healthcare offering.

(b) Management consultancy agreementsNOTE 8 – SUBSEQUENT EVENTS

During the three month period ended June 30, 2021 and 2020, the Company did not issue any restricted common stock to management consultants; the stock based compensation expense during the three month period ended June 30, 2020 of $59,000Derivative Financial Instruments related to the release of prepayments and accrued expenses.

(c) Investor relations agreements

The Company has entered into contracts with several investor relations specialists to help support the ongoing financing activities of the business.

During the three month periods ended June 30, 2021, and 2020, fees paid to an investor relations company were $122,000 and $21,000, respectively.

(d) Subsequent events

On July 23, 2021, Nemaura Medical Inc. (the “Company”) entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co., LLC (the “Agent”) pursuant to whichAugust 1, 2022 under the Company may offer and sell from time to time to or through the Agent sharesterms of the Company’s common stock,forward currency exchange contract, the Company was $0.001obligated to convert $500,000 par value per share (“Common Stock”)to GBP at the fixed rate of $1.359.

The offer and salefull details of shares of Common Stock throughour forward contract in place to sell up to $12.5 million are disclosed in the Agent will be made pursuant to the Registration StatementCompany’s Annual Report on Form S-3 (File No. 333-230535), which was declared effective by10-K for the Securities and Exchange Commission (the “SEC”) on April 8, 2019, and a related prospectus supplementyear ended March 31, 2022, as filed with the SEC on the date hereof pursuant to which the Company is offering shares of its Common Stock having an aggregate offering price of up to $100,000,000.

Under the ATM Agreement, the Company may offer and sell shares of Common Stock through the Agent by any method deemed to be an “at the market offering” as defined in Rule 415 of the Securities Act of 1933, as amended, including sales made directly on or through The Nasdaq Capital Market, sales made to or through a market maker other than on an exchange or otherwise, directly to the Agent as principal, in negotiated transactions at market prices prevailing at the time of sale or at prices related to such prevailing market prices, and/or in any other method permitted by law. If the Company elects to utilize the ATM Agreement, the Agent would be obligated to use commercially reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations to sell such shares in accordance with the Company’s instructions (including as to price, time or size limit or other parameters or conditions the Company may impose). The Company will pay the Agent a commission of 3.0% of the gross sales price of any shares of Common Stock sold under the ATM Agreement. The Company has also provided the Agent with customary indemnification rights and has agreed to reimburse the Agent for certain specified expenses up to $20,000 plus up to $2,500 per quarter while the ATM Agreement remains in effect.

The Company is not obligated to sell, and the Agent is not obligated to buy or sell, any shares of Common Stock under the ATM Agreement. The Company or the Agent may terminate the ATM Agreement by providing notice to the other party. The Company intends to use the net proceeds from any ATM offering for general corporate purposes, which include, but are not limited to, the targeted launch of sugarBEAT® into other European markets outside of the UK; the development of the subscription-based service for the US under the Wellness category that was launched in December 2020; establishing a business-to-consumer offering for a metabolic health program; research and development of our BEAT platform for other, non, CGM purposes, such as Lactate monitoring, as well as potential acquisition of other companies, products or technologies that are complementary to the delivery of our mission. Accordingly, our management will have broad discretion as to the use of the net proceeds from any ATM offering under this agreement.SEC.

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion in conjunction with the Condensed Consolidated Financial Statements and accompanying notes included elsewhere in this Quarterly Report on Form 10-Q. This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements. The matters discussed in these forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from those made, projected, or implied in the forward-looking statements. See "Cautionary Statement Concerning Forward-Looking Statements" below, and "Item 1A. Risk Factors" in our Annual Report filed on Form 10-K for the fiscal year ended March 31, 2021,2022, as filed with the Securities and Exchange Commission, as the same may be updated from time to time, for a discussion of the uncertainties, risks and assumptions associated with these statementsstatements.

Overview

We are a medical technology company developing sugarBEAT®, a non-invasive, affordable, and flexible continuous glucose monitoring system for adjunctive use by persons with diabetes. sugarBEAT® consists of a disposable adhesive skin-patch connected to a rechargeable wireless transmitter that displays glucose readings at regular five minute intervals via a mobile app. sugarBEAT® works by extracting glucose from the skin into a chamber in the patch that is in direct contact with an electrode-based sensor. The transmitter sends the raw data to a mobile app where it is processed by an algorithm and displayed as a glucose reading, with the ability to track and trend the data over days, weeks, and months. While sugarBEAT® requires once per day calibration by the patient using a blood sample obtained by a finger stick, we believe sugarBEAT® will be adopted by non-insulin dependent persons with diabetes alongside insulin-injecting persons with diabetes, who all perform multiple daily finger sticks to manage their disease.

CE approval was granted by the European Notified Body BSI in May 2019, allowing the product to be made available for commercial sale, thissale. This approval is subject to an annual review of the underlying ISO 13485 accredited Quality Management System, theSystem. The accreditation was successfully renewed duringin November 2020.2021. In conjunction with the UK licensee (DB Ethitronix),Licensee, the Company commenced a phase 1 launch whereby devices were made available to limited cohorts of users to gauge their feedback so that any fine-tuning could be completed prior to a mass market launch. A larger market launch is expected to commenceThe UK Licensee has also confirmed that it will undertake two Key Opinion Leader (“KOL”) studies in the UK in the coming months viafor its white-labelled service offering that is supported by sugarBEAT®. The KOL studies are intended to provide additional support for the UK licensee, wherebyLicensee’s broader ongoing marketing plans.

The UK Licensee placed an initial order for sugarBEAT® will be available via a number of subscription models the exact nature of which is at the discretion of the UK licensee. In order to support the larger launch, the UK licensee placed their initial order with the Company at the end ofin April 2021 and provided a forecast for its post-launch volume expectations, which the Company is currently gearing up productionhas used to deliver againstestablish both a short and medium term view to inform the Company’s commercial operational requirements. In line with this over the coming months. In addition to this a 24 month forecast for expected future orders was also received from the UK licensee to enableview, the Company has taken the following actions during the fiscal year to establish future production volume estimates.date:

In July 2020, Nemaura filed a PMA application with the FDA to use sugarBEAT® as an adjunct to finger prick testing for blood glucose trending. We, along with other applicants, were then informed by the FDA that the approval process was currently subject to delays as a result of the FDA’s Center for Devices and Radiological Health (“CDRH”) being actively engaged in responding to the current pandemic caused by COVID-19 which resulted in staff being reallocated to other approval requests associated with COVID-19. During April 2021 the FDA confirmed that they would recommence their review of the PMA application and this is now ongoing and in-progress. In December 2021 The FDA’s Bio-monitoring research division conducted an audit of the clinical program submitted in support of the PMA application. A single 483 observation was raised, and the Company submitted a full response in January 2022. The FDA subsequently scheduled a pre-market inspection for during the second calendar quarter of 2022,  intended to cover the FDA’s Quality System/Current Good Manufacturing Practice regulations for Medical Devices (21 CFR Part 820). This audit was conducted in Q1 of this year and the company reported that a single 483 observation was raised to which the company responded in a timely manner, and dialogue with the FDA continues with respect to the pMA application. 

In addition to this, Nemaura established that proBEAT^TMproBEAT™, which is based on the sugarBEAT® platform, can be classified under the Wellness guidance when it is used according to the FDA Wellness guidance notes, to provide prompts and educate users on factors affecting their blood sugar profiles. Nemaura launched proBEAT™ in the U.S. in December 2020, as part of a diabetes prevention and reversal program branded BEATdiabetes.life. During the quarter ended December 31, 2020, Nemaura licensed a clinically validated weight loss program for the management of diabetes from Healthimation, LLC, which was originally developed at the Joslin Diabetes Center, an affiliate of Harvard Medical School. This program, together with proBEAT^TM,proBEAT™, forms the BEATdiabetes.life program that is currently being developed for commercialization in the United States.U.S. KOL studies are being conducted to provide additional marketing support of the program in preparation for a broader U.S.-wide roll-out. While still in the relatively early stages, we are pleased with initial results and feedback received from these user-groups.

We believe there are additional applications for sugarBEAT® and the underlying BEAT technology platform, which may include:

During this period of product development, the Company has experienced recurring losses and negative cash flows from operations. As of June 30, 2021,2022, the Company had cash balances of $31,259,753,$14,751,833, working capital of $21,646,685,($465,873) (deficit), total stockholders' equity of $7,967,399$3,958,150 (deficit) and an accumulated deficit of $27,188,396. The$41,710,773.

While the Company expects to continue to incur losses from operations for the near-term and these losses could be significant as product development, regulatory activities, clinical trials, and other commercial and product development related expenses are incurred.incurred, the Company reached a significant milestone during the three month period ended December 31, 2021, as the Company commenced commercial delivery of its sugarBEAT® device to its UK Licensee.

Management's strategic assessment includescontinues to include the following potential options:

Recent Developments

December 2021 marked a significant milestone in the Company’s evolutionary journey with the first two commercial deliveries of the sugarBEAT® non-invasive glucose monitor (“CGM”) being made to the UK licensee, MySugarWatch Limited (“MSW”). It is expected that MSW will sell the CGM under the brand MySugarWatch® and MSW has developed a subscription-based diabetes coaching and management service that will be provided alongside the CGM, primarily targeting those with type 2 diabetes.

The deliveries reflect the phased delivery schedule agreed upon with MSW in relation to MSW’s initial order that was placed earlier in 2021, as a result of which the Company is now able to recognize revenue for the first time in its corporate history.

Furthermore, on September 24, 2021, the Company entered into a License, Supply and Distribution Agreement with ‘MySugarWatch DuoPack Limited’ (“MSW-DP”), a sister company of MSW, whereby MSW-DP will provide CGM sensors free of charge with certain medications that are widely prescribed to persons with Type 2 diabetes. These medications are due to come off patent in the fourth calendar quarter of 2022 in Europe and the UK, and 2023 in the U.S. The agreed sale price of sensors to MSW-DP under the terms of the agreement is $20 per box of 5 sensors for the U.S. market, and in Europe and the UK 12.50 Euros in the first 12 months from product launch and 10 Euros thereafter per box of 5 sensors. Nemaura’s anticipated cost of goods per sensor on large-scale production is $1 per sensor. As of January 2022, there were over 2 million prescriptions written for these medications each month in the combined key EU and UK territories. The Company believes this will provide an opportunity for rapid market penetration in the use of its CGM sensors, at a scale that can enable the targeted lower cost of goods to be achieved and thereby support both revenue and margin growth into the future.

Management is now focused on fulfilling the remainder of the UK licensees’ initial orders and supporting MSW’s UK launch, while also developing the capabilities of the Company to develop and service new channels of business across other geographic markets via the use of our BEAT platform. This includes expansion of the consumer metabolic health offering Miboko, launched in late 2021, to employers and insurers across the U.S.

ATM Offering

In July 2021, the Company entered into an At The Market Offering Agreement (the “ATM Agreement”) with H.C. Wainwright & Co., LLC (the “Agent”) pursuant to which the Company may offer and sell from time to time to or through the Agent shares of the Company’s common stock. On April 1, 2022, the Company and Agent entered into an amendment (the “Amendment”) to the ATM Agreement, pursuant to which the parties agreed to expand the meaning of the defined term “Registration Statement” in the ATM Agreement to include, for the period from April 1, 2022 and thereafter, a new shelf registration statement (File Number 333-263618) on Form S-3 (“New Registration Statement”) that was filed on March 16, 2022 with the SEC and declared effective by the SEC on March 28, 2022. No other changes to the ATM Agreement were made by the Amendment.

The offer and sale of shares of Common Stock through the Agent will be made pursuant to the New Registration Statement, and a related prospectus supplement filed with the SEC pursuant to which the Company is offering shares of its common stock having an aggregate offering price of up to $3,000,000.

Termination of Chief Financial Officer

Effective July 1, 2022, Justin Mclarney was terminated as the Company’s Chief Financial Officer. The Company has commenced a search for a U.S.-based replacement Chief Financial Officer.  In the meantime, the Company’s finance team, which has significant experience with the Company, will continue to support the Company with respect to its accounting and financial reporting requirements, and Dewan Fazlul Hoque Chowdhury, Chief Executive Officer, President, member of the Board of Directors and significant stockholder of the Company, will act as principal financial officer and principal accounting officer of the Company.

COVID-19 Pandemic

The outbreak of COVID-19 originating in Wuhan, China, in December 2019 has since rapidly increased its exposure globally. On March 11, 2020, the World Health Organization declared the outbreak a pandemic. We continue to monitor the impact of COVID-19 on our own operations and are working with our employees, suppliers, and other stakeholders to mitigate the risks posed by its spread, but COVID-19 is not expected to have any long-term detrimental effect on the Company’s success as whilesuccess. While key suppliers have not always been accessible throughout the whole period of the outbreak, we have been able to be flexible in our priorities and respond favorably to the challenges faced during this period. We also recognize that one of the consequences of this pandemic has been a surge in the uptake of technologies for remote monitoring of patients and patient self-monitoring, which potentially enhances the prospects for the Company, its CGM product and its planned digital healthcare offering.

Results of Operations

Comparative Results for the Three Months Ended June 30, 20212022 and 20202021

Revenue

There was no revenue recognized in the three months ended June 30, 2021 and 2020. In 2014, we received an upfront non-refundable cash payment of GBP 1 million (approximately $1.38 million and $1.38 million as of June 30, 2021 and March 31, 2021, respectively) in connection with an Exclusive Marketing Rights Agreement with an unrelated third party that provides the third party (the “UK Licensee”) the exclusive right to market and promote the sugarBEAT® device and related patch under its own brand in the United Kingdom and the Republic of Ireland. We have deferred this licensing revenue until sales are due to commence, and we expect to record the revenue as income over an approximately 10-year term from the date sales commence. Although the revenue has been treated as deferred at June 30, 2021, the cash payment became immediately available and has been used to fund our operations, including research and development costs associated with successfully obtaining the CE mark approval.

During the three month period ended June 30, 2021 the Company received its first order from the UK Licensee in preparation for its own product launch plan, which2022 or June 30, 2021. Revenue is anticipatedgenerally recognized as goods are dispatched and invoiced to occur in the quarter ending December 31, 2021. The initial order is scheduled to commence deliveryour customer. Given lead times on manufacture, no goods were dispatched during the quarter ending September 30, 2021, in order to enable the UK Licensee to hold inventory on-hand to support its launch. Under the terms of the contact, the Company was able to issue a ‘deposit’ invoice to cover costs incurred associated with purchases directly incurred to service orders made by the UK Licensee, as such an invoice was raised at the end of the quarter for approximately $513,000. We anticipate that this will be recorded as income upon delivery of the order or in part thereof. As ofended June 30, 2021,2022. This resulted in no revenue recognized this invoice has been treated as deferred revenue within current liabilities with the debit balance being captured within other receivables, the cash payment for which is anticipated in line with the agreed standard contractual terms.quarter.

Research and Development Expenses

Research and development (“R&D”) expenses were $288,484$330,055 and $315,312$288,484 for the three months ended June 30, 20212022 and 2020,2021, respectively. This amount consisted primarily of expenditures on wages and sub-contractor activities incurred for improvements made to the sugarBEAT® device. The decreaseincrease of $26,828 is largely$41,571 was driven by a reduction in sub-contractor costs as the sugarBEAT®product movesfurther improvements made to commercial launch. Moving forward we anticipate that the cost reductions seen in this area will continue as we see a re-balancing across general and administrative expenses driven by the commercial operations of the business become more relevant albeit it is expected that the company will continue to incur expenses in this area in relation to new pipeline products are moved through their respective development phases.our device.

General and Administrative Expenses

General and administrative expenses were $1,332,185$1,880,938 and $595,720$1,332,185 for the three months ended June 30, 20212022 and 2020,2021, respectively. These expenses consisted of fees for legal, professional, consultancy, audit services, investor relations, insurance, advertising and general and operational wages. TheAs with prior quarters, the increase in expenses was being driven predominantly by increased wages, as additional headcount has been added to support the operational scale up process across both our UK and USU.S. teams. Increases have also been seen in insurance and advertising costs, which are considered to be directly related to the commercialization steps taken during the period. In addition to this, a non-cash item charge of $613,687 was booked as a result of the mark-to-market impact from the revaluation of the foreign currency forward contracts in place as of the fiscal period end.

We anticipateAs the Company continues to scale up to service its existing order book, it is expected that general and administrative expenses will continue to increase in a similar way moving forward, as the business transitions to a more operational focused base that will encompass an increase in functionsfunctional expenses associated withrelating to production, sales, marketing, customer service, as well as enhancements to other existing functions.

Other Comprehensive (Loss) / IncomeLoss

For the three months ended June 30, 20212022 and 2020,2021, other comprehensive (loss) / incomeloss was ($10,706) and $4,823,$444,937 and$10,706, respectively. Currently all transactions recorded through other comprehensive (loss) / incomeloss arise from fluctuations in the USD:GBP exchange rate and the impact that this has on consolidation of the Company’s non-USD denominated assets and liabilities.

Liquidity and Capital Resources

We have experienced net losses and negative cash flows from operations since our inception. We have sustained cumulative losses of $27,188,396$41,710,773 through June 30, 2021.2022. We have historically financed our operations through the issuancesa combination of equitydebt and contributions of services from related entities. While no shares were issued during the quarter, 366,892 warrants were exercised which provided $2,963,658 of additionalequity funding.

As of June 30, 2021,2022, the Company had a net working capitaldeficit of $21,646,685$465,873, which included cash balances of $31,259,753.$14,751,833. The Company reported a net loss for the three month periodperiods ended June 30, 2022 and 2021 of $3,343,725.$3,979,297 and $3,343,725, respectively. This loss is after taking account of interest and debt accretion charges arising from the note purchase agreements for the three month periodperiods ended June 30, 2022 and 2021 of $1,723,056.$1,768,304 and $1,723,056, respectively.

We believeHaving reviewed the cash position as of June 30, 2021, is adequate for our current planned level of operations, through at least August 2022, which encompasses the continued establishment of commercial manufacturing operations for the supply of the sugarBEAT® device and patchesCompany’s forward looking cashflow requirements in relation to ourthe cash balance held at June 30, 2022, management is aware of the need to raise additional funds in order to finance the ongoing commercialization of sugarBEAT®. The Company had $14,751,833 of cash at June 30, 2022, however the terms of the existing licensing agreements, combineddebt held on balance sheet will fall due for repayment as of February 2023, which will trigger a requirement to either restructure the debt or obtain additional, new, funding. 

In evaluating the going concern position of the Company, management has considered the ability of the Company to raise additional funding in combination with one or more of the on-going stepsdifferent funding options available to it at this time.  Based on current and ongoing engagement with potential funding providers, management believes that there is a reasonable expectation that funding could be provided by one, or more, of the following options:

Equity funding – the company has immediate access to funds through the ATM facility that is currently in place; in addition to this, there are various alternative mechanisms available to the company similar to those used previously e.g. direct sale of shares to interested third parties, similar to the stake sold to Tiger Trading Partners L.L.C. in February 2022, as well as other mechanisms to sell common stock via an underwritten agreement or the further exercise of warrants by the current warrant holders etc.

Debt funding – the Company continues to be in ongoing discussions with third party debt providers, including the incumbent, to enable the existing debt facility to be restructured or renewed, should management feel that this route offers a more attractive option compared to the sale of equity that is dependent on the current market conditions.

Alternative funding as used in the past such as the sale of licenses.  As product development is now at a significant more advanced stage then it was, it is management’s belief that the Company is takingsufficient funding could be provided through the sale of licenses in a similar way to identifythe UK license agreement sale that help provided early-stage development funding.

However, as a consequence of this funding requirement being triggered without the funding bridge having been put in place by the filing date of these unaudited condensed consolidated financial statements, ASC 205-40 requires that Management recognize and attract market growth opportunities elsewhere.disclose this point as an event which creates a substantial doubt as to the Company’s ability to continue as a going concern for at least one year from the date of filing of these unaudited condensed consolidated financial statements.

Cash Flows

Net cash used in operating activities for the three months ended June 30, 2022 was $2,384,143, reflecting a net loss of $3,979,297, adjusted for the add back of the accretion of debt discount expense of $1,768,304, the mark-to-market charge booked in relation to the revaluation of the foreign currency forward contracts of $613,687 and the depreciation and amortization charge of $98,792. Cash was also impacted by increases in inventory of $137,386, which was directly driven as a result of commercial scale up.

Prepayments increased by $355,329, which was as a result of an increase in amount paid to Hamilton Court ($600,000), our forward contract provider, partially offset by a movement on value added tax debtor of $143,000.

There was also a $43,609 decrease in accounts payable during the fiscal period, with decreases seen in both other liabilities and accrued expenses of $120,812.

Net cash used in operating activities for the three months ended June 30, 2021 was $1,690,028, which reflected ourwith the key drivers being driven by the net loss of $3,343,725, adjusted for the add backwhich includes non-cash charges of $36,133 in relation to depreciation and amortization, $1,723,056 in relation to the accretion of debt discount expensediscount. In addition, we saw an increase in prepaid expenses of $1,723,056 and depreciation and amortization charge$550,211. An increase of $36,133. Cash$31,583 was also impacted by increasesseen in prepaymentsinventory as the business moved to prepare its capacity to support of $550,211 and inventorythe imminent expectation of $31,583 as well asproduct launch. The Company also saw reductions in accounts payable ($145,898), related party balances ($256,583), offset by an increaseof $145,898, as well as increases in accruals of $363,052 and deferred revenue of $515,731.$515,731 and reduction in the liability due to related parties of $256,583.

Net cash used in operatinginvesting activities for the three months ended June 30, 20202022, was $1,077,594$217,712, which reflected our net losspatent filing costs of $1,100,056, accretion$25,598, the purchase of debt discount $188,579, a decrease in prepaid expensesproperty and equipment of $152,438, an increase in accruals of $43,950, non-cash stock-based compensation of $59,000, a decrease in liability due$192,114 driven by the procurement to related parties of $284,453 and a decrease in accounts payable of $103,135.support the transition to operational production.

Net cash used in investing activities was $398,221 for the three months ended June 30, 2021, which reflectedreflects $293,285 in software development that is being treated as work-in-progress for the BEATdiabetes.life platform. The Company also spent $22,714 on patent filing costs of $22,714,and $82,222 on the purchase of property and equipment of $82,222to support future production and $293,285 in software development costs.sensor development.

Net cash used in investing activities was $12,282 for the three months ended June 30, 2020, which reflected patent filing costs of $10,283 and the purchase of property and equipment of $1,999.

Net cash provided by financing activities for the three months ended June 30, 20212022 was $1,463,658,$74,282, comprising $2,963,658$4,700,000 from proceeds of proceeds from warrants exercisedlong term debt offset by $1,500,000$4,774,282 for the scheduled repayments of notes payable.

Net cash provided by financing activities for the three months ended June 30, 20202021 was $6,957,651. The ATM facility delivered proceeds of $2,047,462 and proceeds from issuance of notes totalled $4,943,074 less commission expense of $325,000. In addition, $394,475$1,463,658. $2,963,658 was raised in relation to the exercise of 37,933 warrants.warrants offset by scheduled repayments against debt facilities of $1,500,000.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements, including unrecorded derivative instruments that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Critical Accounting Policies and Estimates

When we prepare our unaudited condensed consolidated financial statements and accompanying notes in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”), we must make estimates and assumptions about future events that affect the amounts we report. Certain of these estimates result from judgements that can be subjective and complex. As a result of that subjectivity and complexity, and because we continuously evaluate these estimates and assumptions based on a variety of factors, actual results could materially differ from our estimates and assumptions if changes in one or more factors require us to make accounting adjustments. We believe our critical accounting policies affect our more significant judgments and estimates used in the preparation of the unaudited condensed consolidated financial statements. During the three monthsmonth period ended June 30, 2021,2022, we have made no material changes or additions with regard to such policies and estimates.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Foreign Exchange Risk

Not applicable

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

AsDr. Dewan F.H. Chowdhury, our Chief Executive Officer and Interim Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report, we carried out anQuarterly Report on Form 10-Q. Based on this evaluation as of June 30, 2022, the Company’s Chief Executive Officer and interim Chief Financial Officer has concluded that, as of June 30, 2022, the Company’s disclosure controls and procedures (as defined in Rules 13a-15 under the supervision andSecurities Exchange Act of 1934, as amended (the “Exchange Act”)) were not effective due to a material weakness in the Company’s internal control over financial reporting.

As of June 30, 2022, our management, with the participation of our principal executive officer and principalChief Executive Officer, who is also serving as our Interim Chief Financial Officer, evaluated our internal control over financial officer,reporting. This assessment included the impact the departure of the effectivenessChief Financial Officer had on the internal control over financial reporting.  As a result of our assessment, management identified the following material weaknesses in internal control over financial reporting as of June 30, 2022:

Management has identified that there is a lack of adequate financial expertise related to the assessment of complex transactions and a lack of adequate resources to review out of the designordinary transactions and operationarrangements of our disclosure controlsthe Company. This could result in the improper reporting of significant transactions or arrangements.

Remediation of Material Weaknesses

We are in the process of implementing improvements and procedures (as such term is definedremedial measures in Rules 13a-15(e)response to the material weakness.  We are currently in the process of hiring a replacement CFO with US public company experience and 15d-15(e) under the Exchange Act). Based on this evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures are effective in alerting them in a timely manner to material information required to be disclosed in our periodic reports filed with the SEC.expertise.

Changes in Internal Control over Financial Reporting

There have been no changes in the Company'sCompany’s internal controlscontrol over financial reporting identified in connection with the evaluation required by RulesRule 13a-15 under the Exchange Act during the first fiscal quarter ended June 30, 20212022 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

None.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed in the Company’s Annual Report on Form 10-K for the year ended March 31, 2021,2022, filed with the SEC on June 29, 2021.2022.

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

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.None

ITEM 6. EXHIBITS

The exhibits listed on the Exhibit Index below are filed as part of this report.

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.

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