U.S. 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 March 31, 2023

☐ 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 001-38758

Enochian Biosciences Inc.

(Exact name of registrant as specified in its charter)

Delaware		45-2559340
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification Number)

1927 Paseo Rancho Castillo Los Angeles, CA		90032
(Address of principal executive offices)		(Zip Code)

+1(305) 918-1980

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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

Title of Each Class		Trading Symbol		Name of Each Exchange on Which Registered
Common Stock, par value $0.0001 per share		ENOB		The Nasdaq Stock Market LLC

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, or an emerging growth company. See 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	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		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 ☒

As of May 12, 2023, the number of shares of the registrant’s common stock outstanding was 58,283,591.

ENOCHIAN BIOSCIENCES INC. AND SUBSIDIARIES

- INDEX -

		Page
PART I – FINANCIAL INFORMATION:		1

Item 1.	Financial Statements (Unaudited):	1

	Condensed Consolidated Balance Sheets as of March 31, 2023 (Unaudited) and June 30, 2022	2

	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended March 31, 2023, and 2022 (Unaudited)	3

	Condensed Consolidated Statements of Comprehensive Loss for the Three and Nine Months Ended March 31, 2023, and 2022 (Unaudited)	4

	Condensed Consolidated Statements of Stockholders’ Equity for the Nine Months Ended March 31, 2023, and 2022 (Unaudited)	5

	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended March 31, 2023, and 2022 (Unaudited)	6

	Notes to the Condensed Consolidated Financial Statements (Unaudited)	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35

Item 4.	Controls and Procedures	35

PART II – OTHER INFORMATION:		36

Item 1.	Legal Proceedings	36

Item 1A.	Risk Factors	37

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37

Item 3.	Defaults Upon Senior Securities	37

Item 4.	Mine Safety Disclosures	37

Item 5.	Other Information	37

Item 6.	Exhibits	37

Signatures		38

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements.

The accompanying financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and in accordance with the instructions for Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, the financial statements contain all material adjustments, consisting only of normal recurring adjustments necessary to present fairly the financial condition, results of operations, and cash flows of the Company for the interim periods presented.

The results for the periods ended March 31, 2023, are not necessarily indicative of the results of operations for the full year. These financial statements and related footnotes should be read in conjunction with the financial statements and footnotes thereto included in the Company’s Form 10-K for the fiscal year ended June 30, 2022, filed with the Securities and Exchange Commission on February 27, 2023.

ENOCHIAN BIOSCIENCES INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS


	March 31,			June 30,
	2023			2022
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash	$	2,948,042		$	9,172,142
Prepaids and other assets		978,883			392,996
Total Current Assets		3,926,925			9,565,138

Property and equipment, net		529,254			586,536

OTHER ASSETS:
Definite life intangible assets, net		41,095			44,268
Indefinite life intangible assets, net		61,571,000			61,571,000
Goodwill		11,640,000			11,640,000
Deposits and other assets		58,586			68,635
Operating lease right-of-use assets		963,869			1,157,086
Total Other Assets		74,274,550			74,480,989

TOTAL ASSETS	$	78,730,729		$	84,632,663

LIABILITIES
CURRENT LIABILITIES:
Accounts payable – trade	$	4,471,354		$	1,401,867
Accrued expenses		593,728			1,031,462
Other current liabilities		501,048			220,685
Contingent consideration liability		—			2,343,318
Notes payable, net		4,801,011			—
Convertible notes payable		1,200,000			1,200,000
Current portion of operating lease liabilities		206,222			253,636
Total Current Liabilities		11,773,363			6,450,968

NON-CURRENT LIABILITIES:
Notes payable, net		—			4,577,148
Operating lease liabilities, net of current portion		829,213			985,699
Total Non-Current Liabilities		829,213			5,562,847
Total Liabilities		12,602,576			12,013,815

Commitments and Contingencies		—			—

STOCKHOLDERS’ EQUITY:
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; no shares issued and outstanding		—			—
Common stock, par value $0.0001, 100,000,000 shares authorized, 57,983,591 shares issued and outstanding at March 31, 2023, and 53,007,082 shares issued and outstanding at June 30, 2022		5,800			5,302
Additional paid-in capital		286,985,739			276,989,179
Accumulated deficit		(220,831,001	)		(204,345,197	)
Accumulated other comprehensive loss		(32,385	)		(30,436	)
Total Stockholders’ Equity		66,128,153			72,618,848

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	78,730,729		$	84,632,663

See accompanying notes to the unaudited condensed consolidated financial statements.

ENOCHIAN BIOSCIENCES INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)


	For the Three Months Ended						For the Nine Months Ended
	March 31,						March 31,
	2023			2022			2023			2022

Operating Expenses
General and administrative	$	3,796,057		$	2,790,456		$	12,365,960		$	11,169,724
Research and development		239,137			1,212,380			3,170,471			6,605,038
Depreciation and amortization		28,242			31,720			85,487			95,258
Total Operating Expenses		4,063,436			4,034,556			15,621,918			17,870,020

LOSS FROM OPERATIONS		(4,063,436	)		(4,034,556	)		(15,621,918	)		(17,870,020	)

Other Income (Expense)

Loss on extinguishment of contingent consideration		—			—			(419,182	)		—
Change in fair value of contingent consideration		—			(2,078,994	)		—			(5,070,891	)
Interest expense		(122,289	)		(95,206	)		(310,766	)		(278,327	)
Interest and other income (expense)		(142,571	)		7,291			(133,938	)		22,897
Total Other Income (Expense)		(264,860	)		(2,166,909	)		(863,886	)		(5,326,321	)

Loss Before Income Taxes		(4,328,296	)		(6,201,465	)		(16,485,804	)		(23,196,341	)

Income Tax (Provision) Benefit		—			—			—			(34	)

NET LOSS	$	(4,328,296	)	$	(6,201,465	)	$	(16,485,804	)	$	(23,196,375	)

BASIC AND DILUTED NET LOSS PER SHARE	$	(0.08	)	$	(0.12	)	$	(0.30	)	$	(0.44	)

WEIGHTED AVERAGE NUMBER OF SHARES OF COMMON STOCK OUTSTANDING - BASIC AND DILUTED		55,974,605			52,638,823			55,524,511			52,391,698

See accompanying notes to the unaudited condensed consolidated financial statements.

ENOCHIAN BIOSCIENCES INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(UNAUDITED)


	For the Three Months Ended						For the Nine Months Ended
	March 31,						March 31,
	2023			2022			2023			2022

Net Loss	$	(4,328,296	)	$	(6,201,465	)	$	(16,485,804	)	$	(23,196,375	)
Other Comprehensive (Loss)
Foreign currency translation, net of taxes		(2,110	)		(2,677	)		(1,949	)		(10,660	)

Comprehensive Loss	$	(4,330,406	)	$	(6,204,142	)	$	(16,487,753	)	$	(23,207,035	)

See accompanying notes to the unaudited condensed consolidated financial statements.

ENOCHIAN BIOSCIENCES INC. AND SUBSIDIARIES

SEC Form 10-Q filed by Enochian Biosciences Inc.