Corporate Information and Continuing Operations

9 Months Ended

Mar. 31, 2024

Corporate Information and Continuing Operations [Abstract]

CORPORATE INFORMATION AND CONTINUING OPERATIONS

1. CORPORATE INFORMATION AND CONTINUING OPERATIONS

Business

InMed Pharmaceuticals Inc. (“InMed” or the “Company”) was incorporated in the Province of British Columbia on May 19, 1981 under the Business Corporations Act of British Columbia. InMed is a clinical stage pharmaceutical company developing a pipeline of proprietary small molecule drug candidates, targeting the treatment of diseases with high unmet medical needs as well as developing proprietary manufacturing technologies to produce bulk rare cannabinoids for sale as ingredients in the health and wellness industry.

The Company’s shares are listed on the Nasdaq Capital Market (“Nasdaq”) under the trading symbol “INM”. InMed’s office and principal place of business is located at #310 – 815 West Hastings Street, Vancouver, B.C., Canada, V6C 1B4.

Going Concern

In accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40), the Company has evaluated whether there are conditions and events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the consolidated financial statements are issued.

Through March 31, 2024, the Company has funded its operations primarily with proceeds from the sale of common stock. The Company has incurred recurring losses and negative cash flows from operations since its inception, including net losses of approximately $5.7 million and $7.6 million for the nine months ended March, 2024 and 2023, respectively. In addition, the Company had an accumulated deficit of approximately $107.1 million as of March 31, 2024. The Company expects to continue to generate operating losses for the foreseeable future.

As of the issuance date of these condensed consolidated financial statements, the Company expects its cash, cash equivalents and short-term investments of $7.6 million as of March 31, 2024, will be sufficient to fund its operating expenses and capital expenditure requirements into the fourth quarter of calendar 2024, depending on the level and timing of realizing BayMedica, LLC, a wholly-owned subsidiary of the Company (“BayMedica”), revenues from the sale of bulk rare cannabinoids as ingredients in the health and wellness sector as well as the level and timing of the Company’s operating expenses. The future viability of the Company is dependent on its ability to raise additional capital to finance its operations. The Company has concluded that there is substantial doubt about its ability to continue as a going concern within one year after the date that the condensed consolidated financial statements are issued.

The Company expects to continue to seek additional funding through equity financings, debt financings or other capital sources, including collaborations with other companies, government contracts or other strategic transactions. The Company may not be able to obtain financing on acceptable terms, or at all. The terms of any financing may adversely affect the holdings or the rights of the Company’s existing shareholders.

In connection with the Company’s assessment of going concern considerations in accordance with Subtopic 205-40, management has determined that the Company’s liquidity condition raises substantial doubt about the Company’s ability to continue as a going concern, which is considered to be for a period of one year from the issuance of these financial statements. These condensed consolidated financial statements do not include any adjustments relating to recoverability and classification of recorded asset amounts or the amounts of classification of liabilities that might result from the outcome of this uncertainty. Such adjustments could be material.