6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16

UNDER THE SECURITIES EXCHANGE ACT OF 1934

For the month of July 2023.

Commission File Number: 000-53805

Intellipharmaceutics International Inc.

(Translation of registrant's name into English)

30 WORCESTER ROAD TORONTO, ONTARIO M9W 5X2

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F. Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

This Report of Foreign Private Issuer on Form 6-K and the attached exhibits 99.1, 99.2 and 101 shall be incorporated by reference into the Company’s effective Registration Statements on Form F-3, as amended and supplemented (Registration Statement Nos. 333-172796 and 333-218297), filed with the Securities and Exchange Commission, from the date on which this Report is filed, to the extent not superseded by documents or reports subsequently filed or furnished by Intellipharmaceutics International Inc. under the Securities Act of 1933 or the Securities Exchange Act of 1934.

EXHIBIT LIST

Exhibit	Description
99.1	Management Discussion And Analysis Of Financial Condition And Results Of Operations for the Three and Months Ended May 31, 2023
99.2	Condensed Unaudited Interim Consolidated Financial Statements and Notes to Condensed Unaudited Interim Consolidated Financial Statements of Intellipharmaceutics International Inc. for the Three and six Months Ended May 31, 2023
99.3	News Release dated July 14, 2023 - Intellipharmaceutics Announces Second Quarter 2023 Results
99.4	Form 52-109F2 - Chief Executive Officer
99.5	Form 52-109F2 - Chief Financial Officer

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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.

	Intellipharmaceutics International Inc.
	(Registrant)
Date: July 14, 2023		/s/Dr. Amina Odidi
		Dr. Amina Odidi President/COO, Acting Chief Financial Officer

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EX-99.1

  EXHIBIT 99.1

2023 Second Quarter

Management Discussion and Analysis

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MANAGEMENT DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

For the THREE and six MONTHS ENDED May 31, 2023

The following Management Discussion and Analysis (“MD&A”) should be read in conjunction with the May 31, 2023 condensed unaudited interim consolidated financial statements of Intellipharmaceutics International Inc. The condensed unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), as outlined in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). Our accounting policies have the potential to have a significant impact on our condensed unaudited interim consolidated financial statements, either due to the significance of the financial statement item to which they relate or because they require judgment and/or estimation due to the uncertainty involved in measuring, at a specific point in time, events which are continuous in nature.  The information contained in this document is current in all material respects as of July 14, 2023 unless otherwise noted.

Unless the context otherwise requires, the terms “we”, “us”, “our”, “Intellipharmaceutics”, and the “Company” refer to Intellipharmaceutics International Inc. and its subsidiaries. Any reference in this document to our “products” includes a reference to our product candidates and future products we may develop. Whenever we refer to any of our current product candidates (including additional product strengths of products we are currently marketing) and future products we may develop, no assurances can be given that we, or any of our strategic partners, will successfully commercialize or complete the development of any of such product candidates or future products under development or proposed for development, that regulatory approvals will be granted for any such product candidate or future product, or that any approved product will be produced in commercial quantities or sold profitably, or at all.

Unless stated otherwise, all references to “$” or “U.S. Dollars” are to the lawful currency of the United States and all references to “C$” are to the lawful currency of Canada. We refer in this document to information regarding potential markets for our products, product candidates and other industry data. We believe that all such information has been obtained from reliable sources that are customarily relied upon by companies in our industry. However, we have not independently verified any such information.

Intellipharmaceutics™, Hypermatrix™, Drug Delivery Engine™, IntelliFoam™, IntelliGITransporter™, IntelliMatrix™, IntelliOsmotics™, IntelliPaste™, IntelliPellets™, IntelliShuttle™, nPODDDS™, PODRAS™, Regabatin™ XR and Aximris XR^TM are our trademarks. These trademarks are important to our business. Although we may have omitted the “TM” trademark designation for such trademarks in this document, all rights to such trademarks are nevertheless reserved. Unless otherwise noted, other trademarks used in this document are the property of their respective holders.

We initially named our oxycodone hydrochloride extended-release tablets (“Oxycodone ER”) “Rexista™”, but later changed the name of our product candidate to “Aximris XR™” as the United States Food and Drug Administration (“FDA”) did not approve the proposed name “Rexista”. References in this document to Oxycodone ER, Rexista™ or Aximris XR™ are intended to refer to our oxycodone hydrochloride extended-release tablets product candidate.

Unless the context otherwise requires, references in this document to share amounts, per share data, share prices, exercise prices and conversion rates have been adjusted to reflect the effect of the 1-for-10 reverse split of our common shares (the “reverse split”) which became effective on each of The NASDAQ Capital Market (“Nasdaq”) and the Toronto Stock Exchange (“TSX”) at the open of market on September 14, 2018. As described below, the common shares of the Company are currently traded on the OTCQB Venture Market (“OTCQB”) and the TSX.

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FORWARD-LOOKING STATEMENTS

Certain statements in this document constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and/or “forward-looking information” under the Securities Act (Ontario). These statements include, without limitation, statements expressed or implied regarding our expectations, plans, goals and milestones, status of developments or expenditures relating to our business, plans to fund our current activities, and statements concerning our partnering activities, health regulatory submissions, strategy, future operations, future financial position, future sales, revenues and profitability, projected costs and market penetration and risks or uncertainties arising from the delisting of our shares from Nasdaq and our ability to comply with OTCQB and TSX requirements. In some cases, you can identify forward-looking statements by terminology such as “appear”, “unlikely”, “target”, “may”, “will”, “should”, “expects”, “plans”, “plans to”, “anticipates”, “believes”, “estimates”, “predicts”, “confident”, “prospects”, “potential”, “continue”, “intends”, "look forward", “could”, “would”, “projected”, “set to”, “goals”, “seeking” or the negative of such terms or other comparable terminology. We made a number of assumptions in the preparation of our forward-looking statements. You should not place undue reliance on our forward-looking statements, which are subject to a multitude of known and unknown risks and uncertainties that could cause actual results, future circumstances or events to differ materially from those stated in or implied by the forward-looking statements.

Risks, uncertainties and other factors that could affect our actual results include, but are not limited to, the effects of general economic conditions, securing and maintaining corporate alliances, our estimates regarding our capital requirements and the effect of capital market conditions and other factors, including the current status of our product development programs, capital availability, the estimated proceeds (and the expected use of any proceeds) we may receive from any offering of our securities, the potential dilutive effects of any financing, potential liability from and costs of defending pending or future litigation, risks associated with the novel coronavirus (COVID-19) including its impact on our business and operations, our programs regarding research, development and commercialization of our product candidates, the timing of such programs, the timing, costs and uncertainties regarding obtaining regulatory approvals to market our product candidates and the difficulty in predicting the timing and results of any product launches, the timing and amount of profit-share payments from our commercial partners, and the timing and amount of any available investment tax credits.  Other factors that could cause actual results to differ materially include but are not limited to:

· the actual or perceived benefits to users of our drug delivery technologies, products and product candidates as compared to others;

· our ability to establish and maintain valid and enforceable intellectual property rights in our drug delivery technologies, products and product candidates;

· the scope of protection provided by intellectual property rights for our drug delivery technologies, products and product candidates;

· recent and future legal developments in the United States and elsewhere that could make it more difficult and costly for us to obtain regulatory approvals for our product candidates and negatively affect the prices we may charge;

· increased public awareness and government scrutiny of the problems associated with the potential for abuse of opioid based medications;

· pursuing growth through international operations could strain our resources;

· our limited manufacturing, sales, marketing and distribution capability and our reliance on third parties for such;

· the actual size of the potential markets for any of our products and product candidates compared to our market estimates;

· our selection and licensing of products and product candidates;

· our ability to attract distributors and/or commercial partners with the ability to fund patent litigation and with acceptable product development, regulatory and commercialization expertise and the benefits to be derived from such collaborative efforts;

· sources of revenues and anticipated revenues, including contributions from distributors and commercial partners, product sales, license agreements and other collaborative efforts for the development and commercialization of product candidates;

· our ability to create an effective direct sales and marketing infrastructure for products we elect to market and sell directly;

· the rate and degree of market acceptance of our products;

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· delays in product approvals that may be caused by changing regulatory requirements;

· the difficulty in predicting the timing of regulatory approval and launch of competitive products;

· the difficulty in predicting the impact of competitive products on sales volume, pricing, rebates and other allowances;

· the number of competitive product entries, and the nature and extent of any aggressive pricing and rebate activities that may follow;

· the inability to forecast wholesaler demand and/or wholesaler buying patterns;

· seasonal fluctuations in the number of prescriptions written for our generic Focalin XR® capsules which may produce substantial fluctuations in revenue;

· the timing and amount of insurance reimbursement regarding our products;

· changes in laws and regulations affecting the conditions required by the FDA for approval, testing and labeling of drugs including abuse or overdose deterrent properties, and changes affecting how opioids are regulated and prescribed by physicians;

· changes in laws and regulations, including Medicare and Medicaid, affecting among other things, pricing and reimbursement of pharmaceutical products;

· the effect of recent changes in U.S. federal income tax laws, including but not limited to, limitations on the deductibility of business interest, limitations on the use of net operating losses and application of the base erosion minimum tax, on our U.S. corporate income tax burden;

· the success and pricing of other competing therapies that may become available;

· our ability to retain and hire qualified employees;

· the availability and pricing of third-party sourced products and materials;

· challenges related to the development, commercialization, technology transfer, scale-up, and/or process validation of manufacturing processes for our products or product candidates;

· the manufacturing capacity of third-party manufacturers that we may use for our products;

· potential product liability risks;

· the recoverability of the cost of any pre-launch inventory should a planned product launch encounter a denial or delay of approval by regulatory bodies, a delay in commercialization, or other potential issues;

· the successful compliance with FDA, Health Canada and other governmental regulations applicable to us and our third-party manufacturers’ facilities, products and/or businesses;

· our reliance on commercial partners, and any future commercial partners, to market and commercialize our products and, if approved, our product candidates;

· difficulties, delays, or changes in the FDA approval process or test criteria for Abbreviated New Drug Applications (“ANDAs”) and New Drug Applications (“NDAs”);

· challenges in securing final FDA approval for our product candidates, including our Oxycodone ER product candidate in particular, if a patent infringement suit is filed against us with respect to any particular product candidates (such as in the case of Oxycodone ER), which could delay the FDA’s final approval of such product candidates;

· healthcare reform measures that could hinder or prevent the commercial success of our products and product candidates;

· the risk that the FDA may not approve requested product labeling for our product candidate(s) having abuse-deterrent properties and targeting common forms of abuse (oral, intra-nasal and intravenous);

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· risks associated with cyber-security and the potential vulnerability of our digital information or the digital information of a current and/or future drug development or commercialization partner of ours; and

· risks arising from the ability and willingness of our third-party commercialization partners to provide documentation that may be required to support information on revenues earned by us from those commercialization partners.

Additional risks and uncertainties relating to us and our business can be found in our reports, public disclosure documents and other filings with the securities commissions and other regulatory bodies in Canada and the U.S. which are available on www.sedar.com and www.sec.gov. The forward-looking statements reflect our current views with respect to future events and are based on what we believe are reasonable assumptions as of the date of this document. We disclaim any intention and have no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of our actual operating results.

CORPORATE DEVELOPMENT

· On June 5, 2023 the Company filed it’s annual audited financial statements for the year ended November 30, 2022 as well as the interim (Q1 2023) financial statements, MD&A and the required certifications. The Ontario Securities Commission (the “OSC”) was satisfied that the Company had filed the continuous disclosure documents required within the time specified in the failure to file cease trade order (CTO), then in effect, and revoked the CTO June 7, 2023.

· On March 7, 2023 the Company had announced that the Ontario Securities Commission (the “OSC”) had issued a general "failure to file" cease trade order (CTO) pursuant to National Policy 11-103 – Failure to File Cease Trade Orders in Multiple Jurisdictions dated March 6, 2023 in respect of the securities of the Company as a result of the Company’s inability to file its annual audited financial statements and other required filings for the fiscal year ended November 30, 2022 by the filing deadline of May 31, 2023.

· The CTO prohibited the trading, whether direct or indirect, by any person of any securities of the Company in each jurisdiction in Canada in which the Company is a reporting issuer for as long as the CTO remains in effect; however, the CTO provides an exception for beneficial security holders of the Company who are not (and who were not as of March 6, 2023) insiders or control persons of the Company and who sell securities of the Company acquired before March 6, 2023 if both of the following criteria are met: (i) the sale is made through a "foreign organized regulated market", as defined in section 1.1 of the Universal Market Integrity Rules of the Investment Industry Regulatory Organization of Canada and (ii) the sale is made through an investment dealer registered in a jurisdiction of Canada in accordance with applicable securities legislation. If the default is remedied within 90 days of the date of the CTO (March 6, 2023), including any annual or interim financial statements, MD&A and certifications that subsequently became due, the filing of the documents constitutes the application to revoke the CTO and no application fee would be required.

· On February 3, 2023 the Company had announced that its annual audited financial statements for the fiscal year ended November 30, 2022, related management’s discussion and analysis and accompanying Chief Executive Officer and Chief Financial Officer certificates and annual information form for the fiscal year ended November 30, 2022 due May 31, 2023 will not be filed by the filing deadline.

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	In connection with the anticipated delay, the Company had applied to the applicable Canadian securities regulators that a management cease trade order (the “MCTO”) be imposed to restrict trading in the common shares in the capital of the Company by insiders of the Company, as opposed to a general cease trade order, which would restrict all trading in the shares, pursuant to National Policy 12-203 – Management Cease Trade orders (“NP 12-203”). However, we were informed that the company was not eligible for that consideration.
·	In August 2022 the Company announced that it has entered into a license and supply agreement with Taro Pharmaceuticals Inc. ("Taro"), by which the Company has granted Taro an exclusive license to market, sell and distribute in Canada, Desvenlafaxine Extended-release Tablets in the 50 mg and 100 mg strengths (the "licensed product") approved for sale in the Canadian market by the Pharmaceutical Drugs Directory (PDD) of Health Canada.
·	In February 2022 the Company received marketing approval for the Canadian market from Health Canada (notice of compliance) for generic Pristiq (desvenlafaxine succinate extended-release tablets) in the 50 and 100 mg strengths.

There can be no assurance that our generic of Pristiq (desvenlafaxine succinate extended-release tablets) in the 50 and 100 mg strengths approved for marketing in Canada and licensed to Taro will be successfully commercialized and produce significant revenues for us. There can be no assurance that any of our approved products will be successfully commercialized and produce significant revenues for us.

BUSINESS OVERVIEW

On October 22, 2009, Intellipharmaceutics Ltd. and Vasogen Inc. completed a court-approved plan of arrangement and merger (the “IPC Arrangement Transaction”) resulting in the formation of the Company, which is incorporated under the laws of Canada and the common shares of which are currently traded on the TSX and OTCQB.

We are a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. Our patented Hypermatrix™ technology is a multidimensional controlled-release drug delivery platform that can be applied to the efficient development of a wide range of existing and new pharmaceuticals. Based on this technology platform, we have developed several drug delivery systems and a pipeline of products (some of which have received FDA approval) and product candidates in various stages of development, including ANDAs filed with the FDA and one NDA filing, in therapeutic areas that include neurology, cardiovascular, gastrointestinal tract (“GIT”), diabetes and pain.

In November 2005, we entered into a license and commercialization agreement with Par Pharmaceutical Inc. (“Par”)(as amended on August 12, 2011 and September 24, 2013, the “Par agreement”), pursuant to which we granted Par an exclusive, royalty-free license to make and distribute in the U.S. all strengths of our generic Focalin XR® (dexmethylphenidate hydrochloride extended-release) capsules for a period of 10 years from the date of commercial launch (which was November 19, 2013). Under the Par agreement, we made a filing with the FDA for approval to market generic Focalin XR® capsules in various strengths in the U.S. (the “Company ANDA”), and are the owner of that Company ANDA, as approved in part by the FDA. We retain the right to make and distribute all strengths of the generic product outside of the U.S. Calendar quarterly profit-sharing payments for its U.S. sales under the Company ANDA are payable by Par to us as calculated pursuant to the Par agreement. Within the purview of the Par agreement, Par also applied for and owns an ANDA pertaining to all marketed strengths of generic Focalin XR® (the “Par ANDA”), and is now approved by the FDA, to market generic Focalin XR® capsules in all marketed strengths in the U.S. As with the Company ANDA, calendar quarterly profit-sharing payments are payable by Par to us for its U.S. sales of generic Focalin XR® under the Par ANDA as calculated pursuant to the Par agreement.

We received final approval from the FDA in November 2013 under the Company ANDA to launch the 15 and 30 mg strengths of our generic Focalin XR® capsules. Commercial sales of these strengths were launched immediately by our commercialization partner in the U.S., Par. 

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In January 2017, Par launched the 25 and 35 mg strengths of its generic Focalin XR® capsules in the U.S., and in May 2017, Par launched the 10 and 20 mg strengths, complementing the 15 and 30 mg strengths of our generic Focalin XR® marketed by Par. The FDA granted final approval under the Par ANDA for its generic Focalin XR® capsules in the 5, 10, 15, 20, 25, 30, 35 and 40 mg strengths, and subsequently Par launched the remaining 5 and 40 mg strengths. Under the Par agreement, we receive quarterly profit share payments on Par’s U.S. sales of generic Focalin XR®. Revenues from sales of the generic Focalin XR® capsules continue to be impacted by ongoing competitive pressures in the generic market. There can be no assurance whether revenues from this product will improve going forward. We depend significantly on the actions of our marketing partner Par in the prosecution, regulatory approval and commercialization of our generic Focalin XR® capsules and on its timely payment to us of the contracted calendar quarterly payments as they come due.

The Company has now received final FDA approval for the 5 mg, 10 mg, 30 mg and 40 mg strengths in its ANDA.

In May 2017, we received final approval from the FDA for our ANDA for quetiapine fumarate extended-release tablets in the 50, 150, 200, 300 and 400 mg strengths. The Company manufactured and shipped commercial quantities of all strengths of generic Seroquel XR® to Mallinckrodt, our then marketing and distribution partner, and Mallinckrodt launched all strengths in June 2017; however, the arrangement did not generate significant revenue. On April 12, 2019, we and Mallinckrodt mutually agreed to terminate the Mallinckrodt agreement. Effective August 12, 2019, the Mallinckrodt agreement was terminated.

These and the Company’s other approved products and products under development are discussed under “PRODUCTS AND PRODUCT CANDIDATES”.

We continue to evaluate options to commercialize these approved generic products, but there can be no assurance these can ever produce significant revenue for the Company.

In February 2022, we received marketing approval, for sale in the Canadian market, for our generic Pristiq (desvenlafaxine succinate extended-release tablets) in the 50 and 100 mg strengths. The Company has now entered into a license and supply agreement with Taro Pharmaceuticals Inc. ("Taro"), by which the Company has granted Taro an exclusive license to market, sell and distribute the product in Canada, There can be no assurance that the product will be successfully commercialized and produce significant revenues for us.

Our goal is to leverage our proprietary technologies and know-how in order to build a diversified portfolio of revenue generating commercial products. We intend to do this by advancing our products from the formulation stage through product development, regulatory approval and manufacturing. We believe that full integration of development and manufacturing will help maximize the value of our drug delivery technologies, products and product candidates. We also believe that out-licensing sales and marketing to established organizations, when it makes economic sense, will improve our return from our products while allowing us to focus on our core competencies. We expect our expenditures for the purchase of production, laboratory and computer equipment and the expansion of manufacturing and warehousing capability to be higher when we have to accommodate the commercialization of approved products and more ANDAs that are pending FDA approval, if and when these events occur. We have reduced the levels of development activities and staffing levels from late 2019 due to the financial condition of the Company, and later the effects of COVID-19 as well.

There can be no assurance that any of our product candidates will receive regulatory approval from FDA, Health Canada or the regulatory authorities of any other country in which our products are proposed to be sold, or that any of our products will ever be successfully commercialized and produce significant revenues for us.

From late 2019 the Company has had to reduce development activities and staffing levels significantly due to ongoing financial problems which have continued, coupled with the effects of the Covid-19 pandemic. It is not possible to reliably estimate the length and severity of the developments and impact on the future financial results and condition of the Company. The challenges and uncertaintiescould impair the Company’s ability to raise capital,postpone research activities, impact our ability to maintain operations and launch new products; it could also impair the value of our shares, our long-lived assets, and materially adversely impact our ability to generate potential future revenue.

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STRATEGY

Our Hypermatrix™ technologies are central to the development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. The Hypermatrix™ technologies are a multidimensional controlled-release drug delivery platform that we believe can be applied to the efficient development of a wide range of existing and new pharmaceuticals. We believe that the flexibility of these technologies allows us to develop complex drug delivery solutions within an industry-competitive timeframe. Based on this technology platform, we have developed several drug delivery systems and a pipeline of products (some of which have received FDA approval) and product candidates in various stages of development, including ANDAs filed with the FDA (and one ANDS filed with Health Canada) and one NDA filing, in therapeutic areas that include neurology, cardiovascular, GIT, diabetes and pain. We expect that certain, but not all, of the products in our pipeline may be developed from time to time for third parties pursuant to drug development agreements with those third parties, under which our commercialization partner may pay certain of the expenses of development, make certain milestone payments to us and receive a share of revenues or profits if the drug is developed successfully to completion, the control of which would generally be in the discretion of our drug development partner.

The principal focus of our development activities previously targeted difficult-to-develop controlled-release generic drugs which follow an ANDA regulatory pathway. Later, our development program became increasingly directed towards improved difficult-to-develop controlled-release drugs which follow an NDA 505(b)(2) regulatory pathway. We increased emphasis towards specialty new product development, facilitated by the 505(b)(2) regulatory pathway, by advancing the product development program for Oxycodone ER and Regabatin^TM XR, and commencing other projects in our 505(b)(2) pipeline. We intend to work on these and other product candidates as resources permit. Currently, we are not working on any of these product candidates. In January 2019, we announced that we had commenced an R&D program of pharmaceutical cannabidiol (“CBD”) -based products. As part of the CBD-based R&D program, we filed provisional patent applications with the United States Patent and Trademark Office pertaining to the delivery and application of cannabinoid-based therapeutics. There can be no assurance that any of our provisional patent applications will successfully mature into patents. We had also previously identified several additional 505(b)(2) product candidates for development in various areas including cardiovascular, dermatology, pulmonary disease and oncology. We are still exploring the potential development of such product candidates when resources are available. The technology that is central to our abuse deterrent formulation of our Oxycodone ER is the nPODDDS™, or novel Point of Divergence Drug Delivery System. nPODDDS™ is designed to provide for certain unique drug delivery features in a product. These include the release of the active substance to show a divergence in a dissolution and/or bioavailability profile. The divergence represents a point or a segment in a release timeline where the release rate, represented by the slope of the curve, changes from an initial rate or set of rates to another rate or set of rates, the former representing the usually higher rate of release shortly after ingesting a dose of the drug, and the latter representing the rate of release over a later and longer period of time, being more in the nature of a controlled-release or sustained action. It is applicable for the delivery of opioid analgesics in which it is desired to discourage common methods of tampering associated with misuse and abuse of a drug, and also dose dumping in the presence of alcohol. It can potentially retard tampering without interfering with the bioavailability of the product.

In addition, our PODRAS™, or Paradoxical OverDose Resistance Activating System, delivery technology was initially introduced to enhance our Oxycodone ER (abuse deterrent oxycodone hydrochloride extended release tablets) product candidate. The PODRAS™ delivery technology platform was designed to prevent an overdose when more pills than prescribed are swallowed intact. Preclinical studies of prototypes of oxycodone with PODRAS™ technology suggest that, unlike other third-party abuse-deterrent oxycodone products in the marketplace, if more tablets than prescribed are deliberately or inadvertently swallowed, the amount of drug active ingredient (“drug active”) released over 24 hours may be substantially less than expected. However, if the prescribed number of pills is swallowed, the drug release should be as expected. Certain aspects of our PODRAS™ technology are covered by U.S. Patent Nos. 9,522,119, 9,700,515, 9,700,516 and 9,801,939. The issuance of these patents provides us with the opportunity to accelerate our PODRAS™ development plan by pursuing proof of concept studies in humans. We intend to incorporate this technology in future product candidates, including Oxycodone ER and other similar pain products, as well as pursuing out-licensing opportunities. The development of an Oxycodone immediate-release (IR) product incorporating this technology as resources permit is in the Company’s development pipeline. There can be no assurance that any issued Patent can be maintained by the Company, there can be no assurance that any application filed by the Company will issue as a Patent.

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The NDA 505(b)(2) pathway (which relies in part upon the FDA’s findings for a previously approved drug) both accelerates development timelines and reduces costs in comparison to NDAs for new chemical entities. An advantage of our strategy for development of NDA 505(b)(2) drugs is that our product candidates can, if approved for sale by the FDA, potentially enjoy an exclusivity period which may provide for greater commercial opportunity relative to the generic ANDA route.

The market we operate in is created by the expiration of drug product patents, challengeable patents and drug product exclusivity periods. There are three ways that we employ our controlled-release technologies, which we believe represent substantial opportunities for us to commercialize on our own or develop products or out-license our technologies and products:

For branded immediate-release (multiple-times-per-day) drugs, we can formulate improved replacement products, typically by developing new, potentially patentable, controlled-release once-a-day drugs. Among other out-licensing opportunities, these drugs can be licensed to and sold by the pharmaceutical company that made the original immediate-release product. These can potentially protect against revenue erosion in the brand by providing a clinically attractive patented product that competes favorably with the generic immediate-release competition that arises on expiry of the original patent(s). The regulatory pathway for this approach requires NDAs via a 505(b)(2) application for the U.S. or corresponding pathways for other jurisdictions where applicable.

Some of our technologies are also focused on the development of abuse-deterrent and overdose preventive pain medications. The growing abuse and diversion of prescription “painkillers”, specifically opioid analgesics, is well documented and is a major health and social concern. We believe that our technologies and know-how are aptly suited to developing abuse-deterrent pain medications. The regulatory pathway for this approach requires NDAs via a 505(b)(2) application for the U.S. or corresponding pathways for other jurisdictions where applicable.

For existing controlled-release (once-a-day) products whose active pharmaceutical ingredients (APIs) are covered by drug molecule patents about to expire or already expired, or whose formulations are covered by patents about to expire, already expired or which we believe we do not infringe, we can seek to formulate generic products which are bioequivalent to the branded products. Our scientists have demonstrated a successful track record with such products, having previously developed several drug products which have been commercialized in the U.S. by their former employer/clients. The regulatory pathway for this approach requires ANDAs for the U.S. and ANDSs for Canada.

We intend to collaborate in the development and/or marketing of one or more products with partners, when we believe that such collaboration may enhance the outcome of the project. We seek additional collaborations as a means of developing additional products. We believe that our business strategy enables us to reduce our risk by (a) having a diverse product portfolio that includes both branded and generic products in various therapeutic categories, and (b) building collaborations and establishing licensing agreements with companies with greater resources thereby allowing us to share costs of development and to improve cash-flow. There can be no assurance that we will be able to enter into additional collaborations or, if we do, that such arrangements will be commercially viable or beneficial.

OUR DRUG DELIVERY TECHNOLOGIES

Hypermatrix^TM

Our scientists have developed drug delivery technology systems, based on the Hypermatrix™ platform, that facilitate controlled-release delivery of a wide range of pharmaceuticals. These systems include several core technologies, which enable us to flexibly respond to a wide range of drug attributes and patient requirements, producing a desired controlled-release effect. Our technologies have been incorporated in drugs manufactured and sold by major pharmaceutical companies.

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This group of drug delivery technology systems is based upon the drug active being imbedded in, and an integral part of, a homogeneous (uniform), core and/or coatings consisting of one or more polymers which affect the release rates of drugs, other excipients (compounds other than the drug active), such as for instance lubricants which control handling properties of the matrix during fabrication, and the drug active itself.  The Hypermatrix™ technologies are the core of our current marketing efforts and the technologies underlying our existing development agreements.

nPODDDS^TM

In addition to continuing efforts with Hypermatrix™ as a core technology, our scientists continue to pursue novel research activities that address unmet needs. Oxycodone ER (abuse deterrent oxycodone hydrochloride extended-release tablets) is an NDA candidate with a unique long-acting oral formulation of oxycodone intended to treat moderate-to-severe pain. The formulation is intended to present a significant barrier to tampering when subjected to various forms of physical and chemical manipulation commonly used by abusers. It is also designed to prevent dose dumping when inadvertently co-administered with alcohol.   The technology that supports our abuse deterrent formulation of oxycodone is the nPODDDS™ Point of Divergence Drug Delivery System. The use of nPODDDS™ does not interfere with the bioavailability of oxycodone. We intend to apply the nPODDDS™ technology platforms to other extended-release opioid drug candidates (e.g., oxymorphone, hydrocodone, hydromorphone and morphine) utilizing the 505(b)(2) regulatory pathway.

PODRAS^TM

Our Paradoxical OverDose Resistance Activating System (PODRAS™) delivery technology is designed to prevent overdose when more pills than prescribed are swallowed intact. Preclinical studies of prototypes of oxycodone with PODRAS™ technology suggest that, unlike other third-party abuse-deterrent oxycodone products in the marketplace, if more tablets than prescribed are deliberately or inadvertently swallowed, the amount of drug active released over 24 hours may be substantially less than expected. However, if the prescribed number of pills is swallowed, the drug release should be as expected. We have started, and intend to continue, working on an alternate Oxycodone ER product candidate incorporating our PODRAS™ delivery technology. In April 2015, the FDA published Guidance for Industry: Abuse-Deterrent Opioids — Evaluation and Labeling, which cited the need for more efficacious abuse-deterrence technology. In this Guidance, the FDA stated, “opioid products are often manipulated for purposes of abuse by different routes of administration or to defeat extended-release properties, most abuse-deterrent technologies developed to date are intended to make manipulation more difficult or to make abuse of the manipulated product less attractive or less rewarding. It should be noted that these technologies have not yet proven successful at deterring the most common form of abuse - swallowing a number of intact capsules or tablets to achieve a feeling of euphoria.” The FDA reviewed our request for Fast Track designation for our abuse deterrent Oxycodone ER development program incorporating PODRAS™, and in May 2015 notified us that the FDA had concluded that we met the criteria for Fast Track designation. Fast Track is a designation assigned by the FDA in response to an applicant’s request which meets FDA criteria. The designation mandates the FDA to facilitate the development and expedite the review of drugs intended to treat serious or life-threatening conditions and that demonstrate the potential to address unmet medical needs.

U.S. Patent Nos. 9,522,119, 9,700,515, 9,700,516 and 9,801,939 and Canadian Patent No. 2,910,865 were issued by the U.S. Patent and Trademark Office and the Canadian Intellectual Property Office in respect of “Compositions and Methods for Reducing Overdose”. The issued patents cover aspects of the PODRAS™ delivery technology. The issuance of these patents represents a significant advance in our abuse deterrence technology platform. The PODRAS™ platform has the potential to positively differentiate our technology from others of which we are aware and may represent an important step toward addressing the FDA’s concern over the ingestion of a number of intact pills or tablets. In addition to its use with opioids, the PODRAS^TM platform is potentially applicable to a wide range of drug products, inclusive of over-the-counter drugs, that are intentionally or inadvertently abused and cause harm by overdose to those who ingest them. We intend to apply the PODRAS™ technology platforms to other extended-release opioid drug candidates (e.g., oxymorphone, hydrocodone, hydromorphone and morphine) utilizing the 505(b)(2) regulatory pathway.

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There can be no assurance that we will be successful in developing any product utilizing the PODRASTM platform, that we will be successful in submitting any NDA, that the FDA will approve the product candidate for sale in the U.S. market or any related abuse-deterrent label claims, or that it will ever be successfully commercialized and produce significant revenue for us. There can be no assurance that any issued Patent can be maintained by the Company,

PRODUCTS AND PRODUCT CANDIDATES

The table below shows the present status of our ANDA, ANDS and NDA products and product candidates that have been disclosed to the public.

Generic name	Brand	Indication	Stage of Development(1)	Regulatory Pathway	Rights(2)
Dexmethylphenidate hydrochloride extended-release capsules	Focalin XR®	Attention deficit hyperactivity disorder	Received final approval for 5, 10, 15, 20, 25, 30, 35 and 40 mg strengths from FDA(3) Received final approval for 5 mg, 10 mg, 20 mg and 40 mg in Intellipharmaceutics’ ANDA	ANDA	Intellipharmaceutics and Par (US) Philippines rights subject to licensing and distribution agreement
Levetiracetam extended-release tablets	Keppra XR®	Partial onset seizures for epilepsy	Received final approval for the 500 and 750 mg strengths from FDA	ANDA	ANDA Repository(4)
Venlafaxine hydrochloride extended-release capsules	Effexor XR®	Depression	Received final approval for 37.5, 75 and 150 mg strengths from FDA	ANDA	Intellipharmaceutics.
Pantoprazole sodium delayed- release tablets	Protonix®	Conditions associated with gastroesophageal reflux disease	ANDA Application for commercialization approval for 2 strengths under review by FDA	ANDA	Intellipharmaceutics
Metformin hydrochloride extended-release tablets	Glucophage® XR	Management of type 2 diabetes	Received final approval for 500 and 750 mg strengths from FDA	ANDA	Intellipharmaceutics Philippines and Vietnamese rights subject to licensing and distribution agreements
Quetiapine fumarate extended-release tablets	Seroquel XR®	Schizophrenia, bipolar disorder & major depressive disorder	Received final FDA approval for all 5 strengths.	ANDA .	Intellipharmaceutics. Philippines, Malaysian and Vietnamese rights subject to licensing and distribution agreements

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Generic name	Brand	Indication	Stage of Development(1)	Regulatory Pathway	Rights(2)
Lamotrigine extended-release tablets	Lamictal® XR™	Anti-convulsant for epilepsy	ANDA application for commercialization approval for 6 strengths under review by FDA	ANDA	Intellipharmaceutics
Desvenlafaxine extended-release tablets	Pristiq®	Depression	Received approval for the 50 and 100 mg strengths from FDA. Received approval (notice of compliance) from Health Canada for the 50 mg and 100 mg strengths	ANDA ANDS	Intellipharmaceutics. Taro Pharmaceuticals Inc. (Canada)
Carvedilol phosphate extended-release capsules	Coreg CR®	Heart failure, hypertension	Late-stage development	ANDA	Intellipharmaceutics
Oxycodone hydrochloride controlled-release capsules		Pain	NDA application accepted February 2017 and under review by FDA. Second FDA Advisory Committees meeting held January 2020. Awaiting action from FDA	NDA 505(b)(2)	Intellipharmaceutics
Pregabalin extended-release capsules		Neuropathic pain	IND application submitted in August 2015	NDA 505(b)(2)	Intellipharmaceutics
Ranolazine extended-release tablets	Ranexa®	Chronic angina	ANDA application for commercialization approval for 2 strengths under review by FDA	ANDA	Intellipharmaceutics
Oxycodone hydrochloride immediate release tablets (IPCI006)		Pain	IND application submitted in November 2018	NDA 505(b)(2)	Intellipharmaceutics

Notes:

1.	There can be no assurance as to when, or if at all, the FDA or Health Canada will approve any product candidate for sale in the U.S. or Canadian markets.
2.	For information regarding the Par agreement, and the licensing and distribution agreements with pharmaceutical distributors in Malaysia, Vietnam and the Philippines, see “Business Overview” and “Other Potential Products and Markets” sections. There can be no assurance as to when, or if at all, any of our products or product candidates, as the case may be, will receive regulatory approval for sale in the Philippines, Malaysia or Vietnam. For unpartnered products, we are seeking licensing agreement opportunities or other opportunities. While we believe that licensing agreements are possible, there can be no assurance that any can be secured.
3.	Includes a Company ANDA final approval for our 15 and 30 mg strengths, and a Par ANDA final approval for their 5, 10, 15, 20, 25, 30, 35 and 40 mg strengths. Profit sharing payments to us under the Par agreement are the same irrespective of the ANDA owner.
4.	As at September 30, 2019, pursuant to an ANDA sale agreement (the “Levetiracetam ANDA Agreement”), we sold all of the assets relating to our ANDA for Levetiracetam extended-release 500mg and 750 mg tablets (collectively, the “Transferred Levetiracetam ANDA”) to ANDA Repository, LLC (the “Levetiracetam ANDA Purchaser”) in exchange for a purchase price of $1. Additionally, pursuant to the Levetiracetam ANDA Agreement, we agreed to pay the Levetiracetam ANDA Purchaser an annual fee for each fiscal year equal to 50% of the difference between the FDA Program Fee for 6 to 19 approved ANDAs and the FDA Program Fee for 1 to 5 approved ANDAs. Under the Levetiracetam ANDA Agreement, we have the option to repurchase the Transferred Levetiracetam ANDA for a purchase price of $1 at any time, provided that any outstanding fees are paid to ANDA Repository.

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We typically select products for development that we anticipate could achieve FDA or Health Canada approval for commercial sales several years in the future. However, the length of time necessary to bring a product to the point where the product can be commercialized can vary significantly and depends on, among other things, the availability of funding, design and formulation challenges, safety or efficacy, patent issues associated with the product, and FDA and Health Canada review times.

Dexmethylphenidate Hydrochloride – GenericFocalin XR^®(a registered trademark of the brand manufacturer)

Dexmethylphenidate hydrochloride, a Schedule II restricted product (drugs with a high potential for abuse) in the U.S., is indicated for the treatment of attention deficit hyperactivity disorder. In November 2005, we entered into the Par agreement pursuant to which we granted Par an exclusive, royalty-free license to make and distribute in the U.S. all of our FDA approved strengths of our generic Focalin XR® (dexmethylphenidate hydrochloride extended-release) capsules for a period of 10 years from the date of commercial launch (which was November 19, 2013). We retain the right to make and distribute all strengths of the generic product outside of the U.S. Calendar quarterly profit-sharing payments for its U.S. sales of all strengths of generic Focalin XR® are payable by Par to us as calculated pursuant to the Par agreement.

We received final approval from the FDA in November 2013 under the Company ANDA to launch the 15 and 30 mg strengths of our generic Focalin XR® capsules. Commercial sales of these strengths were launched immediately by our commercialization partner in the U.S., Par. Our 5, 10, 20 and 40 mg strengths were also then tentatively FDA approved, subject to the right of Teva Pharmaceuticals USA, Inc. to 180 days of generic exclusivity from the date of first launch of such products. In January 2017, Par launched the 25 and 35 mg strengths of its generic Focalin XR® capsules in the U.S., and in May 2017, Par launched the 10 and 20 mg strengths, complementing the 15 and 30 mg strengths of our generic Focalin XR® marketed by Par. In November 2017, Par launched the remaining 5 and 40 mg strengths providing us with the full line of generic Focalin XR® strengths available in the U.S. market. The Company has now received final FDA approval for the 5 mg, 10 mg, 30 mg and 40 mg strengths in its ANDA.

In November 2018, we announced that we entered into an exclusive licensing and distribution agreement with a pharmaceutical distributor in the Philippines pursuant to which the distributor was granted the exclusive right, subject to regulatory approval, to import and market our generic Focalin XR® in the Philippines. Under the terms of the agreement, the distributor will be required to purchase a minimum yearly quantity of our generic Focalin XR® and we will be the exclusive supplier of such product. This multi-year agreement is subject to early termination. There can be no assurance as to when and if such product will receive regulatory approval for the sale in the Philippines or that, if so approved, the product will be successfully commercialized there and produce significant revenues for us.

Levetiracetam – Generic Keppra XR® (a registered trademark of the brand manufacturer)

We received final approval from the FDA in February 2016 for the 500 and 750 mg strengths of our generic Keppra XR® (levetiracetam extended release) tablets. Keppra XR®, and the drug active levetiracetam, are indicated for use in the treatment of partial onset seizures associated with epilepsy. We are aware that several other generic versions of this product are currently available and serve to limit the overall market opportunity. We have been exploring licensing and other options for this product.

In November 2018, we announced that we entered into two exclusive licensing and distribution agreements with pharmaceutical distributors in Vietnam and the Philippines pursuant to which the distributors were granted the exclusive right, subject to regulatory approval, to import and market our generic Keppra XR® in Vietnam and the Philippines, respectively. Under the terms of the agreements, the distributors will be required to purchase a minimum yearly quantity of our generic Keppra XR®. These multi-year agreements are each subject to early termination. There can be no assurance that the Company’s generic Keppra XR® for the 500 and 750 mg strengths will be successfully commercialized in the US market. Further, there can be no assurance as to when and if such product will receive regulatory approval for the sale in Vietnam or the Philippines or that, if so approved, the product will ever be successfully commercialized there and produce significant revenues for us.

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On September 30, 2019, pursuant to an ANDA sale agreement (the “Levetiracetam ANDA Agreement”), we sold all of the assets relating to our ANDA for Levetiracetam extended release 500mg and 750 mg tablets (collectively, the “Transferred Levetiracetam ANDA”) to ANDA Repository, LLC (the “Levetiracetam ANDA Purchaser”) in exchange for a purchase price of $1. Additionally, pursuant to the Levetiracetam ANDA sale agreement, we agreed to pay the Levetiracetam ANDA Purchaser an annual fee for each fiscal year equal to 50% of the difference between the FDA Program Fee for 6 to 19 approved ANDAs and the FDA Program Fee for 1 to 5 approved ANDAs. Under the Levetiracetam ANDA Agreement, we have the option to repurchase the Transferred Levetiracetam ANDA for a purchase price of $1 at any time, provided that any outstanding fees are paid to ANDA Repository.

Metformin hydrochloride – Generic Glucophage® XR (a registered trademark of the brand manufacturer)

We received final approval from the FDA in February 2017 for the 500 and 750 mg strengths of our generic Glucophage® XR (metformin hydrochloride extended release) tablets. Glucophage® XR, and the drug active metformin, are indicated for use in the management of type 2 diabetes treatment. The Company is aware that several other generic versions of this product are currently available and serve to limit the overall market opportunity; however, we are continuing to evaluate options to realize commercial returns on this product, particularly in international markets.

In November 2018, we announced that we entered into two exclusive licensing and distribution agreements with pharmaceutical distributors in Vietnam and the Philippines pursuant to which the distributors were granted the exclusive right, subject to regulatory approval, to import and market our generic Glucophage® XR in Vietnam and the Philippines, respectively. Under the terms of the agreements, the distributors will be required to purchase a minimum yearly quantity of our generic Glucophage® XR. These multi-year agreements are each subject to early termination.

There can be no assurance that our generic Glucophage® XR for the 500 and 750 mg strengths will be successfully commercialized in the US market. Further, there can be no assurance as to when and if such product will receive regulatory approval for the sale in Vietnam or the Philippines or that, if so approved, the product will be successfully commercialized there and produce significant revenues for us.

Venlafaxine hydrochloride – Generic Effexor XR® (a registered trademark of the brand manufacturer)

We received final approval from the FDA in November 2018 for our ANDA for venlafaxine hydrochloride extended-release capsules in the 37.5, 75 and 150 mg strengths. The approved product is a generic equivalent of the branded product Effexor XR® sold in the U.S. by Wyeth Pharmaceuticals, LLC. Effexor XR®, and the drug active venlafaxine hydrochloride, are indicated for the treatment of major depressive disorder, or MDD. We are actively exploring the best approach to maximize our commercial returns from this approval. On November 25, 2019, we announced that we had entered into a license and commercial supply agreement with Tris Pharma, by which we granted Tris Pharma an exclusive license to market, sell and distribute in the United States, Venlafaxine extended-release capsules in the 37.5mg, 75mg, and 150 mg strengths. Several other generic versions of the licensed products are currently available in the market and that this limits the overall market opportunity. Product was never supplied nor distributed under this license. Effective May 5, 2021 the Company and Tris Pharma mutually terminated the license agreement.There can be no assurance that the Company’s venlafaxine hydrochloride extended-release capsules for the 37.5mg, 75, and 150 mg strengths will be successfully commercialized and produce significant revenue for us.

Quetiapine fumarate extended-release tablets - Generic Seroquel XR® (a registered trademark of the brand manufacturer)

In May 2017, we received final approval from the FDA for our ANDA for quetiapine fumarate extended-release tablets in the 50, 150, 200, 300 and 400 mg strengths. Our approved product is a generic equivalent for the corresponding strengths of the branded product Seroquel XR® sold in the U.S. by AstraZeneca. Seroquel XR®, and the drug active quetiapine fumarate, are indicated for use in the management of schizophrenia, bipolar disorder and major depressive disorder (MDD).

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The Company manufactured and shipped commercial quantities of all strengths of generic Seroquel XR® to Mallinckrodt, our then marketing and distribution partner, and Mallinckrodt launched all strengths in June 2017; however, the arrangement did not generate significant revenue. On April 12, 2019, we and Mallinckrodt mutually agreed to terminate the Mallinckrodt agreement. Effective August 12, 2019, the Mallinckrodt agreement was terminated.

In November 2018, we announced that we entered into three exclusive licensing and distribution agreements with pharmaceutical distributors in Malaysia, Vietnam and the Philippines pursuant to which the distributors were granted the exclusive right, subject to regulatory approval, to import and market our generic Seroquel XR® in Malaysia, Vietnam and the Philippines, respectively. Under the terms of the agreements, the distributors will be required to purchase a minimum yearly quantity of our generic Seroquel XR®. The multi-year agreements are each subject to early termination. There can be no assurance as to when and if such product will receive regulatory approval for the sale in Malaysia, Vietnam or the Philippines or that, if so approved, the product will be successfully commercialized there and produce significant revenues for us.

On August 15, 2019, we announced a license and commercial supply agreement with Tris Pharma, granting Tris Pharma an exclusive license to market, sell and distribute all strengths of our generic Seroquel XR® in the United States. The agreement provides for the Company to have a profit-sharing arrangement with respect to the licensed product. Product was never supplied nor distributed under this license. Effective May 5, 2021 the Company and Tris Pharma mutually terminated the license agreement. There can be no assurance that the product will be successfully commercialized and produce significant revenue for us.

Desvenlafaxine succinate extended-release tablets – Generic Pristiq® (a registered trademark of the brand manufacturer)

In May 2019, we received approval from the FDA for our ANDA for desvenlafaxine extended-release tablets in the 50 and 100 mg strengths. This product is a generic equivalent of the branded product Pristiq® sold in the U.S. by Wyeth Pharmaceuticals, LLC. Pristiq®, and the drug active desvenlafaxine succinate, are indicated for use in the management of depression.

On September 5, 2019, we announced a license and commercial supply agreement with Tris Pharma, granting Tris Pharma an exclusive license to market, sell and distribute the two strengths of the product in the United States. The agreement provides for the Company to have a profit-sharing arrangement with respect to the licensed product. The product was never supplied nor distributed under this license. Effective May 5, 2021 the Company and Tris Pharma mutually terminated the license agreement. There can be no assurance that our desvenlafaxine extended-release tablets in the 50 and 100 mg strengths will be successfully commercialized and produce significant revenues for us.

In February 2022 the Company received Health Canada marketing approval (notice of compliance) for generic Pristiq (desvenlafaxine extended-release tablets) in the 50 and 100 mg strengths. The Company has entered into a license and supply agreement with Taro for the commercialization of the product by which the Company has granted Taro Pharmaceuticals Inc. an exclusive license to market, sell and distribute the product in Canada. There can be no assurance that the product will be successfully commercialized and produce significant revenues for us.

Oxycodone ER (Abuse Deterrent Oxycodone Hydrochloride Extended-Release Tablets)

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One of our non-generic products under development is our Oxycodone ER (abuse deterrent oxycodone hydrochloride extended-release tablets) product candidate, intended as an abuse and alcohol-deterrent controlled-release oral formulation of oxycodone hydrochloride for the relief of pain. Our Oxycodone ER is a new drug candidate, with a unique long-acting oral formulation of oxycodone intended to treat moderate-to-severe pain when a continuous, around the clock opioid analgesic is needed for an extended period of time. The formulation is intended to present a significant barrier to tampering when subjected to various forms of physical and chemical manipulation commonly used by abusers. It is also designed to prevent dose dumping when inadvertently co-administered with alcohol. Dose dumping is the rapid release of an active ingredient from a controlled-release drug into the blood stream that can result in increased toxicity, side effects, and a loss of efficacy. Dose dumping can result by consuming the drug through crushing, taking with alcohol, extracting with other beverages, vaporizing or injecting. In addition, when crushed or pulverized and hydrated, the proposed extended-release formulation is designed to coagulate instantaneously and entrap the drug in a viscous hydrogel, which is intended to prevent syringing, injecting and snorting. Our Oxycodone ER formulation is difficult to abuse through the application of heat or an open flame, making it difficult to inhale the active ingredient from burning.

In November 2016, we filed an NDA seeking authorization to market our Oxycodone ER in the 10, 15, 20, 30, 40, 60 and 80 mg strengths, relying on the 505(b)(2) regulatory pathway which allowed us to reference data from Purdue’s file for its OxyContin®. In February 2017, the FDA accepted for filing our NDA, and set a Prescription Drug User Fee Act (“PDUFA”) goal date of September 25, 2017. Our submission is supported by pivotal pharmacokinetic studies that demonstrated that Oxycodone ER is bioequivalent to OxyContin®. The submission also includes abuse-deterrent studies conducted to support abuse-deterrent label claims related to abuse of the drug by various pathways, including oral, intra-nasal and intravenous, having reference to the FDA’s “Abuse-Deterrent Opioids - Evaluation and Labeling” guidance published in April 2015. FDA had agreed that we would not be required to conduct Phase III studies if bioequivalence to OxyContin® was demonstrated based on pivotal bioequivalence studies.

Our NDA was filed under Paragraph IV of the Hatch-Waxman Act, as amended. We certified to the FDA that we believed that our Oxycodone ER product candidate would not infringe any of the OxyContin® patents listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, commonly known as the Orange Book (the “Orange Book”), or that such patents are invalid, and so notified all holders of the subject patents of such certification. On April 7, 2017, we received notice that Purdue, Purdue Pharmaceuticals L.P., The P.F. Laboratories, Inc., or collectively the Purdue parties, Rhodes Technologies, and Grünenthal GmbH, or collectively the “Purdue litigation plaintiffs”, had commenced patent infringement proceedings, or the Purdue litigation, against us in the U.S. District Court for the District of Delaware (docket number 17-392) in respect of our NDA filing for Oxycodone ER, alleging that our proposed Oxycodone ER infringes 6 out of the 16 patents associated with the branded product OxyContin®, or the OxyContin® patents, listed in the Orange Book.

Subsequent to the above-noted filing of lawsuit, 4 further such patents were listed and published in the Orange Book. On March 16, 2018, we received notice that the Purdue litigation plaintiffs had commenced further such patent infringement proceedings adding the 4 further patents. On April 15, 2020, Purdue filed a new patent infringement suit against the Company relating to additional Paragraph IV certifications lodged against two more listed Purdue patents.

As a result of the commencement of the first of these legal proceedings, the FDA was stayed for 30 months from granting final approval to our Oxycodone ER product candidate. That time period commenced on February 24, 2017, when the Purdue litigation plaintiffs received notice of our certification concerning the patents, and would expire on August 24, 2019, unless the stay is earlier terminated by a final declaration of the courts that the patents are invalid, or are not infringed, or the matter is otherwise settled among the parties.

On or about June 26, 2018, the court issued an order to sever 6 “overlapping” patents from the second Purdue case but ordered litigation to proceed on the 4 new (2017-issued) patents. An answer and counterclaim was filed on July 9, 2018. On July 6, 2018, the court issued a so-called “Markman” claim construction ruling on the first case and the October 22, 2018 trial date remained unchanged. On July 24, 2018, the parties to the case mutually agreed to and did have dismissed without prejudice the infringement claims related to the Grünenthal ‘060 patent, which is one of the six patents included in the original litigation case. On April 4, 2019, the U.S. Federal Circuit Court of Appeals affirmed the invalidity of one Purdue OxyContin® formulation patent, subject to further appeal to the U.S. Supreme Court.

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On or about July 2, 2020 the parties in the cases, numbers 17-cv-392-RGA, 18-cv-404-RGA and 20-cv-515-RGA (the “Litigations”) between Purdue Pharma L.P. et al (“Purdue’) and Intellipharmaceutics entered into a stipulated dismissal of the Litigations.The stipulated dismissal provides for the termination of patent infringement proceedings commenced by Purdue against the Company in the United States District Court for the District of Delaware in respect of the Company’s NDA filing for Aximris XR^TM with the FDA. The stipulated dismissal also provides that (i) for a thirty (30) day period following a final approval of the Company’s Aximris XR^TM NDA the parties will attempt to resolve any potential asserted patent infringement claims relating to the NDA and (ii) if the parties fail to resolve all such claims during such period Purdue Pharma will have fifteen (15) days to pursue an infringement action against the Company. The terms of the stipulated dismissal agreement are confidential. On July 28, 2020 the United States District Court for the District of Delaware signed the stipulations of dismissal into order thereby dismissing the claims in the three cases without prejudice. In consideration of the confidential stipulated dismissal agreement and for future saved litigation expenses, Purdue has paid an amount of money to the Company.

In June 2017, we announced that a joint meeting of the Advisory Committees of the FDA was scheduled for July 26, 2017 to review our NDA for Oxycodone ER. The submission requested that our Oxycodone ER product candidate include product label claims to support the inclusion of language regarding abuse-deterrent properties for the intravenous route of administration.

In July 2017, the Company announced that the FDA Advisory Committees voted 22 to 1 in finding that the Company’s NDA for Oxycodone ER should not be approved at this time. The Advisory Committees also voted 19 to 4 that the Company had not demonstrated that Oxycodone ER has properties that can be expected to deter abuse by the intravenous route of administration, and 23 to 0 that there was not sufficient data for Oxycodone ER to support inclusion of language regarding abuse-deterrent properties in the product label for the intravenous route of administration. The Advisory Committees expressed a desire to review the additional safety and efficacy data for Oxycodone ER that may be obtained from human abuse potential studies for the oral and intranasal routes of administration.

In September 2017, the Company received a Complete Response Letter (“CRL”) from the FDA for the Oxycodone ER NDA, stating that it could not approve the application at that time. In its CRL, the FDA provided certain recommendations and requests for information, including that the Company complete studies to assess the abuse-deterrent properties of Oxycodone ER by the oral and nasal routes of administration, provide additional information related to the inclusion of the blue dye in the formulation of the product, and submit an alternate proposed proprietary name for Oxycodone ER. The FDA required a response within a year of issuing the CRL but granted our request for an extension to resubmit by May 31, 2019.

In February 2018, the Company met with the FDA to discuss the above-referenced CRL for Oxycodone ER, including issues related to the blue dye in the product candidate. Based on those discussions, the product candidate will no longer include the blue dye. The blue dye was intended to act as an additional deterrent if Oxycodone ER is abused and serve as an early warning mechanism to flag potential misuse or abuse. The FDA confirmed that the removal of the blue dye is unlikely to have any impact on formulation quality and performance. As a result, the Company will not be required to repeat in vivo bioequivalence studies and pharmacokinetic studies submitted in the Oxycodone ER NDA. The FDA also indicated that, from an abuse liability perspective, Category 1 studies will not have to be repeated on Oxycodone ER with the blue dye removed.

The NDA resubmission in response to CRL was filed May 31, 2019. In March 2019, the FDA acknowledged receipt of our resubmission of the Oxycodone ER NDA. The FDA had informed the Company that it considered the resubmission a complete response to the September 22, 2017 action letter it issued in respect of the NDA.

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On July 24, 2019, we announced that the Company had been advised by the FDA that the FDA “is postponing product-specific advisory committee meetings for opioid analgesics,” including the one previously scheduled to discuss our NDA, “while it continues to consider a number of scientific and policy issues relating to this class of drugs.” According to the FDA, the reason for the postponement was not unique to our product and the Anesthetic and Analgesic Drug Products Advisory Committee (“AADPAC”) meeting earlier planned by the FDA, to discuss our NDA was going to be rescheduled at a future date. The FDA informed the Company that it would continue to review the Company’s NDA according to the existing PDUFA timeline, but noted that, due to the postponement of the AADPAC meeting, it was possible that the FDA may be unable to meet the PDUFA goal date of August 28, 2019. The FDA did not meet the PDUFA goal date of August 28, 2019.

On January 15, 2020, at a joint meeting of the Advisory Committees of the FDA to review our NDA for AximrisXR™, abuse-deterrent oxycodone hydrochloride extended-release tablets, the Advisory Committees voted 24 to 2 against the approval of our NDA for AximrisXR^TM for the management of pain severe enough to require daily, around-the-clock, long-term opioid treatment and for which alternative treatment options are inadequate. The 30-month stay date of March 2, 2020 has since expired. The Company has been following up with FDA, however no action has been taken on the NDA yet.

There can be no assurance that the studies submitted to the FDA will be adequate, that we will not be required to conduct further studies for Oxycodone ER, that the FDA will approve any of the Company’s requested abuse-deterrent label claims, that the FDA will ultimately approve our NDA for the sale of Aximris XR^TM in the U.S. market, or that it will ever be successfully commercialized and produce significant revenue for us.If the Aximris XR^TM NDA is approved, there can be no assurance that the Company and Purdue will resolve any potential asserted patent infringement claims relating to the NDA within a thirty (30) day period following the final approval as provided in the stipulated settlement agreement of the Purdue litigations. There can be no assurance that the Purdue parties will not pursue an infringement claim against the Company again.

In November 2018, we announced that we entered into an exclusive licensing and distribution agreement with a pharmaceutical distributor in the Philippines pursuant to which the distributor was granted the exclusive right, subject to regulatory approval, to import and market Oxycodone ER in the Philippines. Under the terms of the agreement, the distributor will be required to purchase a minimum yearly quantity of our Oxycodone ER and we will be the exclusive supplier of our Oxycodone ER. This multi-year agreement is subject to early termination. There can be no assurance as to when and if such product candidate will receive regulatory approval for the sale in the Philippines or that, if so approved, the product will be successfully commercialized there and produce significant revenues for us.

Regabatin™ XR (Pregabalin Extended-Release)

Another non-generic controlled-release product under development is Regabatin™XR, pregabalin extended-release capsules. Pregabalin is indicated for the management of neuropathic pain associated with diabetic peripheral neuropathy, postherpetic neuralgia, spinal cord injury and fibromyalgia. A controlled-release version of pregabalin should reduce the number of doses patients take, which could improve patient compliance, and therefore possibly enhance clinical outcomes. Lyrica® pregabalin, twice-a-day (“BID”) dosage and three-times-a-day (“TID”) dosage, are drug products marketed in the U.S. by Pfizer Inc. In October 2017, Pfizer also received approval for a Lyrica® CR, a controlled-release version of pregabalin. In 2014, we conducted and analyzed the results of six Phase I clinical trials involving a twice-a-day formulation and a once-a-day formulation. For formulations directed to certain indications which include fibromyalgia, the results suggested that Regabatin™ XR 82.5 mg BID dosage was comparable in bioavailability to Lyrica® 50 mg (immediate-release pregabalin) TID dosage. For formulations directed to certain other indications which include neuropathic pain associated with diabetic peripheral neuropathy, the results suggested that Regabatin™ XR 165 mg once-a-day dosage was comparable in bioavailability to Lyrica® 75 mg BID dosage.

In March 2015, the FDA accepted a Pre-Investigational New Drug, or Pre-IND, meeting request for our once-a-day Regabatin™ XR non-generic controlled release version of pregabalin under the NDA 505(b)(2) regulatory pathway, with a view to possible commercialization in the U.S. at some time following the December 30, 2018 expiry of the patent covering the pregabalin molecule. Regabatin™ XR is based on our controlled release drug delivery technology platform which utilizes the symptomatology and chronobiology of fibromyalgia in a formulation intended to provide a higher exposure of pregabalin during the first 12 hours of dosing. Based on positive feedback and guidance from the FDA, we submitted an IND application for Regabatin™ XR in August 2015. The FDA completed its review of the IND application and provided constructive input that we will use towards further development of the program. We believe our product candidate has significant additional benefits to existing treatments and have been evaluating strategic options to advance this opportunity.

18

There can be no assurance that any additional Phase I or other clinical trials we conduct will meet our expectations, that we will have sufficient capital to conduct such trials, that we will be successful in submitting an NDA 505(b)(2) filing with the FDA, that the FDA will approve this product candidate for sale in the U.S. market, or that it will ever be successfully commercialized and produce significant revenue for us.

Oxycodone Hydrochloride IR Tablets (“IPCI006”) (Abuse Deterrent and Overdose Resistant Oxycodone Hydrochloride Immediate Release Tablets)

In November 2018, we announced that we had submitted an investigational new drug (“IND”) application to the FDA for our IPCI006 oxycodone hydrochloride immediate release tablets in the 5, 10, 15, 20 and 30 mg strengths. This novel drug formulation incorporates the Company’s PODRAS^TM delivery technology and its nPODDDS™ technology. IPCI006 is designed to prevent, delay or limit the release of oxycodone hydrochloride when more intact tablets than prescribed are ingested, thus delaying or preventing overdose and allowing for sufficient time for a rescue or medical intervention to take place. It is also intended to present a significant barrier to abuse by snorting, “parachuting,” injecting or smoking finely crushed oxycodone hydrochloride immediate release tablets. The data generated from the studies conducted under this IND is expected to form part of an NDA seeking FDA approval for IPCI006 tablets. If developed and approved, IPCI006 may be the first immediate release formulation of oxycodone hydrochloride intended to simultaneously prevent or delay overdose and prevent abuse by intranasal or intravenous routes.

There can be no assurance that we will be successful in submitting any NDA with the FDA, that the FDA will approve the Company’s IPCI006 product candidate for sale in the U.S. market or any related abuse-deterrent label claims, or that it will ever be successfully commercialized and produce significant revenue for us.

Other Potential Products and Markets

We are continuing our efforts to identify opportunities internationally, particularly in China, that could, if effectuated, provide product distribution alternatives through partnerships and therefore would not likely require an investment or asset acquisition by us. Discussions toward establishing a partnership to facilitate future development activities in China are ongoing. We have not at this time entered into and may not ever enter into any such arrangements.

In addition, we are seeking to develop key relationships in several other international jurisdictions where we believe there may be substantial demand for our generic products. These opportunities could potentially involve out-licensing of our products, third-party manufacturing supply and more efficient access to pharmaceutical ingredients and therefore assist with the development of our product pipeline.

In November 2018, we announced that we had entered into an exclusive licensing and distribution agreement for our abuse resistant Oxycodone ER product candidate and four generic drug products with a pharmaceutical distributor in the Philippines. Under the terms of the agreement the distributor was granted the exclusive right, subject to regulatory approval, to import and market our first novel drug formulation, abuse-deterrent Oxycodone ER, in the Philippines. Additionally, this distributor was granted, subject to regulatory approval, the exclusive right to import and market our generics of Seroquel XR®, Focalin XR®, Glucophage® XR, and Keppra XR® in the Philippines. Under the terms of the agreement, the distributor will be required to purchase a minimum yearly quantity of all products included in the agreement and we will be the exclusive supplier of said products. The multi-year agreement with the Philippines distributor is subject to early termination. Financial terms of the agreement have not been disclosed. There can be no assurance as to when or if any of our products or product candidates will receive regulatory approval for sale in the Philippines or that, if so approved, any such products will be successfully commercialized there and produce significant revenues for us. Moreover, there can be no assurance that we will not be required to conduct further studies for Oxycodone ER, that the FDA will approve any of our requested abuse-deterrent label claims, that the FDA will meet its deadline for review, that the FDA will ultimately approve the NDA for the sale of Oxycodone ER in the U.S. market, or that it will ever be successfully commercialized and produce significant revenue for us.

19

In November 2018, we announced that we had entered into two exclusive licensing and distribution agreements with pharmaceutical distributors in Malaysia and Vietnam.

A Malaysian pharmaceutical distribution company was granted the exclusive right, subject to regulatory approval, to import and market our generic Seroquel XR® (quetiapine fumarate extended release) in Malaysia. Under the terms of the agreement, four strengths (50, 200, 300 and 400 mg) of generic Seroquel XR® will be manufactured and supplied by us for distribution in Malaysia. We are also in discussions to include other products in the agreement with said distributor, who will be required to purchase a minimum yearly quantity of all products included in the agreement.

A Vietnamese pharmaceutical distributor was granted the exclusive right, subject to regulatory approval, to import and market our generic Seroquel XR®, Glucophage® XR, and Keppra XR® in Vietnam. Under the terms of the agreement, two strengths (500 and 750 mg) of generic Glucophage® XR, three strengths (50, 150 and 200 mg) of generic Seroquel XR® and one strength (500 mg) of generic Keppra XR® will be manufactured and supplied by us for distribution in Vietnam. The Vietnamese distributor will be required to purchase a minimum yearly quantity of all products included in the agreement.

The multi-year agreements with the Malaysian and Vietnamese distributors are each subject to early termination. Financial terms of the agreements have not been disclosed. There can be no assurance as to when or if any of our products will receive regulatory approval for sale in Malaysia or Vietnam or that, if so approved, the products will ever be successfully commercialized there and produce significant revenues for the Company.

We had also announced that we had commenced a R&D program of CBD-based products. As part of this R&D program, we filed multiple provisional patent applications with the United States Patent and Trademark Office pertaining to the delivery and application of cannabinoid-based therapeutics.  The patent filings, together with certain of our already issued drug delivery patents, are intended to form the basis of the development of a pipeline of novel controlled-release product candidates with CBD as the main active ingredient.

There can be no assurance that we will be able to develop cannabis-based products or that any cannabis-based product candidates we develop will ever be successfully commercialized or produce significant revenue for us. There can be no assurance that any patents pertaining to the delivery and application of cannabinoid-based therapeutics will be issued to the Company.

20

SELECTED FINANCIAL INFORMATION

	For the three months ended						For the six months ended
	May 31,			May 31,			May 31,			May 31,
	2023			2022			2023			2022
	(unaudited)			(unaudited)			(unaudited)			(unaudited)
	$			$			$			$
Revenue:		480,203			-			806,546			16,978
Expenses:		511,558			1,251,831			1,139,301			2,041,724
Net loss from operations		(31,355	)		(1,251,831	)		(332,755	)		(2,024,746	)
Net loss		(54,121	)		(840,654	)		(409,859	)		(1,721,626	)
Net loss per common share Basic and diluted		(0.002	)		(0.04	)		(0.01	)		(0.07	)

	As at
	May 31,			November 30,
	2023			2022
	(unaudited)			(audited)
	$			$
Cash		159,274			83,722
Total assets		1,735,410			1,432,032
Convertible debentures		1,800,000			1,800,000
Total liabilities		12,722,004			12,008,767
Shareholders' deficiency		(10,986,594	)		(10,576,735	)
Total liabilities and shareholders' equity (deficiency)		1,735,410			1,432,032

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

We have identified the following accounting policies that we believe require application of management’s most significant judgments, often requiring the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods.

Disclosure regarding our ability to continue as a going concern is included in Note 1 to our condensed unaudited interim consolidated financial statements for the three months ended May 31, 2023.

Use of Estimates

The preparation of the condensed unaudited interim consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates.

Areas where significant judgment is involved in making estimates are: the determination of the functional currency; the fair values of financial assets and liabilities; the determination of units of accounting for revenue recognition; the accrual of licensing and milestone revenue; and forecasting future cash flows for assessing the going concern assumption.

Revenue recognition

The Company accounts for revenue in accordance with the provisions of ASC 606 “Revenue from Contracts with Customers” (“ASC 606”). Under ASC 606, the Company recognizes revenue when the customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed under ASC 606: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation(s). The Company earns revenue from non-refundable upfront fees, milestone payments upon achievement of specified research or development, exclusivity milestone payments and licensing payments on sales of resulting products.

21

The relevant revenue recognition accounting policy is applied to each separate unit of accounting.

Licensing

The Company recognizes revenue from the licensing of the Company's drug delivery technologies, products and product candidates. Under the terms of the licensing arrangements, the Company provides the customer with a right to access the Company’s intellectual property with regards to the license which is granted. Revenue arising from the license of intellectual property rights is recognized over the period the Company transfers control of the intellectual property.

The Company has a license and commercialization agreement with Par. Under the exclusive territorial license rights granted to Par, the agreement requires that Par manufacture, promote, market, sell and distribute the product. Licensing revenue amounts receivable by the Company under this agreement are calculated and reported to the Company by Par, with such amounts generally based upon net product sales and net profit which include estimates for chargebacks, rebates, product returns, and other adjustments. Licensing revenue payments received by the Company from Par under this agreement are not subject to further deductions for chargebacks, rebates, product returns, and other pricing adjustments.  Based on this arrangement and the guidance pursuant to ASC 606, the Company records licensing revenue over the period the Company transfers control of the intellectual property in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

Milestones

For milestone payments that are not contingent on sales-based thresholds, the Company applies a most-likely amount approach on a contract-by-contract basis. Management makes an assessment of the amount of revenue expected to be received based on the probability of the milestone outcome. Variable consideration is included in revenue only to the extent that it is probable that the amount will not be subject to a significant reversal when the uncertainty is resolved (generally when the milestone outcome is satisfied).  

Research and development (R&D)

Under arrangements where the license fees and R&D activities can be accounted for as a separate unit of accounting, non-refundable upfront license fees are deferred and recognized as revenue on a straight-line basis over the expected term of the Company's continued involvement in the R&D process.

Deferred revenue

Deferred revenue represents the funds received from clients, for which the revenues have not yet been earned, as the milestones have not been achieved, or in the case of upfront fees for drug development, where the work remains to be completed.

Research and development costs

R&D costs related to continued R&D programs are expensed as incurred in accordance with ASC topic 730. However, materials and equipment are capitalized and amortized over their useful lives if they have alternative future uses.

Translation of foreign currencies

Transactions denominated in currencies other than the Company and its wholly owned operating subsidiaries’ functional currencies, monetary assets and liabilities are translated at the period end rates. Revenue and expenses are translated at rates of exchange prevailing on the transaction dates. All of the exchange gains or losses resulting from these other transactions are recognized in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

The functional and reporting currency of the Company and its subsidiaries is the U.S. dollar.

22

Investment tax credits

The investment tax credits (“ITC") receivable are amounts considered recoverable from the Canadian federal and provincial governments under the Scientific Research & Experimental Development (“SR&ED”) incentive program. The amounts claimed under the program represent the amounts based on management estimates of eligible R&D costs incurred during the year. Realization is subject to government approval. Any adjustment to the amounts claimed will be recognized in the year in which the adjustment occurs. Refundable ITCs claimed relating to capital expenditures are credited to property and equipment. Refundable ITCs claimed relating to current expenditures are netted against R&D expenditures.

Loss per share

Basic loss per share (“EPS”) is computed by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive. The dilutive effect of stock options is determined using the treasury stock method.

RESULTS OF OPERATIONS

Our results of operations have fluctuated significantly from period to period in the past and are likely to do so in the future. We anticipate that our quarterly and annual results of operations will be impacted for the foreseeable future by several factors, including the timing of approvals to market of our product candidates in various jurisdictions, the timing of successful commercialisation of any of our products and any resulting licensing revenue, milestone revenue, product sales, the number of competitive products and the extent of any aggressive pricing activity, wholesaler buying patterns, the timing and amount of payments received pursuant to our current and future collaborations with third parties, the existence of any first-to-file exclusivity periods, and the progress and timing of expenditures related to our research, development and commercialization efforts. Due to these fluctuations, we presently believe that the period-to-period comparisons of our operating results are not a reliable indication of our future performance.

	For the three months ended												For the six months ended
	May 31,			May 31,									May 31,			May 31,
	2023			2022									2023			2022
	(unaudited)			(unaudited)			Change						(unaudited)			(unaudited)			Change
	$			$			$			%			$			$			$			%
Revenue:
Licensing		480,203			-			480,203			100	%		806,546			-			806,546			100	%
Other		-			-			-			N/A			-			16,978			(16,978	)		N/A
		480,203			-									806,546			16,978
Expenses:
Research and development		377,507			956,851			(579,344	)		-61	%		825,673			1,434,408			(608,735	)		-42	%
Selling, general and administrative		93,504			243,501			(149,997	)		-62	%		232,339			504,359			(272,020	)		-54	%
Depreciation		40,547			51,479			(10,932	)		-21	%		81,289			102,957			(21,668	)		-21	%
		511,558			1,251,831			(740,273	)		-59	%		1,139,301			2,041,724			(902,423	)		-44	%
Loss from operations		(31,355	)		(1,251,831	)		1,220,476			-97	%		(332,755	)		(2,024,746	)		1,691,991			-84	%
Net foreign exchange gain (loss)		29,122			(15,357	)		44,479			-290	%		25,544			(22,851	)		48,395			-212	%
Interest expense		(51,888	)		(73,466	)		21,578			-29	%		(102,648	)		(174,029	)		71,381			-41	%
Gain on disposal of asset		-			500,000			(500,000	)		N/A			-			500,000			(500,000	)		N/A
Net loss for the period		(54,121	)		(840,654	)		786,533			-94	%		(409,859	)		(1,721,626	)		1,311,767			-76	%

23

Three months ended May 31, 2023 compared to the three months ended May 31, 2022

Revenue

The Company recorded revenues of $480,203 for the three months ended May 31, 2023 versus $Nil for the three months ended May 31, 2022. Such revenues consisted primarily of licensing revenues from commercial sales of our generic Focalin XR® under the Par agreement during the three months ended May 31, 2023.

Research and Development

Expenditures for R&D were $377,507 for the year ended May 31, 2023 in comparison to $956,851 the three months ended May 31, 2022.  The decrease in the R&D expenses are attributed to the decrease in R&D staff in the first quarter of 2023, also in the second quarter of 2022 allocation of losses on royalty payments was included in R&D cost.

Selling, General and Administrative

Selling, general and administrative expenses were $93,504 for the three months ended May 31, 2023 in comparison to $243,501 for the three months ended May 31, 2022, resulting in a decrease of $122,023. The decrease is due to a decrease in administrative costs, wages, and occupancy cost.

Administrative costs for the three months ended May 31, 2023 were $29,144 in comparison to $161,496 in the three months ended May 31, 2022. The decrease for the three months ended May 31, 2023 was due to the decrease in professional and legal fees.

Expenditures for wages and benefits for the three months ended May 31, 2023 were $40,590 in comparison to $54,294 in the three months ended May 31, 2022.  The decrease in the three months ended May 31, 2023 was due to the reduction in the number of administrative staff.

Occupancy costs for the three months ended May 31, 2023 were $14,949 in comparison to $18,622 for the three months ended May 31, 2022.

Depreciation

Depreciation expenses for the three months ended May 31, 2023 were $40,547 in comparison to $51,479 in the three months ended May 31, 2022.

Foreign Exchange Gain (Loss)

Foreign exchange gain was $29,122 for the three months ended May 31, 2023 in comparison to a loss of $15,357 in the three months ended May 31, 2022. The foreign exchange gain for the three months ended May 31, 2023 was due to the strengthening of the U.S. dollar against the Canadian dollar during the three months ended May 31, 2023 as the exchange rates changed to $1.00 for C$1.3604 as at May 31, 2023 from $1.00 for C$1.3609 as at February 28, 2023. The foreign exchange loss for the three months ended May 31, 2022 was due to the weakening of the U.S. dollar against the Canadian dollar during the three months ended May 31, 2022 as the exchange rates changed to $1.00 for C$1.2649 as at May 31, 2022 from $1.00 for C$1.2698 as at February 28, 2022.  

Interest Expense

Interest expense for the three months ended May 31, 2023 was $51,888 in comparison to $73,466 in the three months ended May 31, 2022. This decrease is primarily due to the November 2019 Debenture not being accreted at an annual effective interest rate during the three months ended May 31, 2023. This is in comparison to the November 2019 Debenture being accreted at an annual effective interest rate of 90.8% during the three months ended May 31, 2022.

Net Loss         

The Company recorded net loss for the three months ended May 31, 2023 of $54,121 or $0.002 per common share, compared with a net loss of $840,654 or $0.03 per common share for the three months ended May 31, 2022. For the three months ended May 31, 2023, the net loss is attributed to expenditures related to ongoing selling, general and administrative expenses related to professional and legal fees, as well as ongoing R&D expenses, offset by an increase in licensing revenue. In the three months ended May 31, 2022, the net loss was attributed to the gain on sale of equipment offset by increased administrative expense related to professional and legal fees and R&D expenses.

24

Six months ended May 31, 2023 compared to the six months ended May 31, 2022

Revenue

The Company recorded revenues of $806,546 for the six months ended May 31, 2023 versus $16,978 for the six months ended May 31, 2022. Such revenues consisted primarily of licensing revenues from commercial sales of generic Focalin XR® under the Par agreement.

Research and Development

Expenditures for R&D for the six months ended May 31, 2023 were $825,673 compared to the six months ended May 31, 2022 were $1,434,408. The decrease is mainly due to the allocation of losses from royalty revenue to R&D expense in the six months ended May 31, 2022.

Selling, General and Administrative

Selling, general and administrative expenses were $232,339 for the six months ended May 31, 2023 in comparison to $504,359 for the six months ended May 31, 2022, resulting in a decrease of $272,020. The decrease is mainly due to a decrease in administrative costs and a decrease in wages.

Administrative costs for the six months ended May 31, 2023 were $89,284 in comparison to $334,105 in the six months ended May 31, 2022. The decrease for the six months ended May 31, 2023 was due to the decrease in professional and legal fees.

Expenditures for wages and benefits for the six months ended May 31, 2023 were $89,642 in comparison to $115,129 in the six months ended May 31, 2022. The decrease in the six months ended May 31, 2023 was due to the reduction in the number of administrative staff compared to the six months ended May 31, 2022.

Depreciation

Depreciation expenses for the six months ended May 31, 2023 were $81,289 in comparison to $102,957 in the six months ended May 31, 2022. The decrease is primarily due to less investment in production, laboratory and computer equipment during the six months ended May 31, 2023.

Foreign Exchange Gain (loss)

Foreign exchange gain was $25,544 for the six months ended May 31, 2023 in comparison to a loss of $22,851 in the six months ended May 31, 2022. The foreign exchange loss for the three months ended May 31, 2023 was due to the strengthening of the U.S. dollar against the Canadian dollar during the three months ended May 31, 2023 as the exchange rates changed to $1.00 for C$1.3604 as at May 31, 2023 from $1.00 for C$1.3508 as at November 30, 2022.The foreign exchange loss for the six months ended May 31, 2022 was due to the weakening of the U.S. dollar against the Canadian dollar during the six months ended May 31, 2021 as the exchange rates changed to $1.00 for C$1.2649 as at May 31, 2022 from $1.00 for C$1.2793 as at November 30, 2021. 

Interest Expense

Interest expense for the six months ended May 31, 2023 was $102,648 in comparison to $174,029 in the six months ended May 31, 2022. This decrease is primarily due to the November 2019 Debenture not being accreted at an annual effective interest rate during the six months ended May 31, 2023. This is in comparison to the November 2019 Debenture being accreted at an annual effective interest rate of 90.8% during the six months ended May 31, 2022.

Net Loss         

The Company recorded net loss for the six months ended May 31, 2023 of $409,859 or $0.01 per common share, compared with a net loss of $1,721,626 or $0.05 per common share for the six months ended May 31, 2022. In the six months ended May 31, 2022, the net loss is attributed to the increase in licensing revenues from commercial sales of generic Focalin XR®, offset by decreased administrative expenses related to professional and legal fees and R&D expenses related to the decrease in third party consulting fees, and the reduction in R&D an administrative staff.  In the six months ended May 31, 2022, the  net loss is attributed to the gain on sale of equipment, combined with administrative expenses related to professional and legal fees and R&D expenses.

25

SUMMARY OF QUARTERLY RESULTS

The table below outlines selected financial data for the eight most recent quarters. The quarterly results are unaudited and have been prepared in accordance with U.S. GAAP, for interim financial information.

Quarter Ended						(Loss) income per share
	Revenue		Net (loss) income			Basici			Dilutedi
	$		$			$			$
May 31, 2023		480,203		(54,121	)		(0.002	)		(0.002	)
February 28, 2023		326,343		(355,738	)		(0.01	)		(0.01	)
November 30, 2022		46,660		(874,725	)		(0.09	)		(0.09	)
August 31, 2022		19,068		(296,043	)		(0.01	)		(0.01	)
May 31, 2022		-		(840,654	)		(0.03	)		(0.03	)
February 28, 2022		-		(880,972	)		(0.03	)		(0.03	)
November 30, 2021		-		(1,956,100	)		(0.17	)		(0.17	)
August 31, 2021		-		(1,264,305	)		(0.04	)		(0.04	)
May 31, 2021		93,427		(1,000,184	)		(0.04	)		(0.04	)

(i) Quarterly per share amounts may not sum due to rounding

It is important to note that historical patterns of revenue and expenditures cannot be taken as an indication of future revenue and expenditures. Net(loss) income has been somewhat variable over the last eight quarters and is reflective of varying levels of commercial sales of generic Focalin XR® capsules, the level of our R&D spending, and the vesting or modification of performance-based stock options. The lower net loss in the second quarter of 2023 is primarily attributed to the significant decrease in the R&D costs, selling, general and administrative expenses, and an increase in licensing revenue. The lower net loss in the first quarter of 2023 is primarily attributed to the significant decrease in the selling, general and administrative expenses, and an increase in licensing revenue. The higher net loss in the fourth quarter of 2022 is primarily attributed to higher R&D spending and an increase in interest expense partially offset by lower general, selling and administrative spending. The lower net loss in the third quarter of 2022 is primarily attributed to the significant decrease in the selling, general and administrative expenses. The lower net loss in the second quarter of 2022 is primarily attributed to the gain on the sale of equipment, offset by higher R&D spending and selling, general and administrative expenses. The lower net loss in the first quarter of 2022 is primarily attributed to slightly higher licensing revenue partially offset by higher accrued interest expense, higher general, selling, administrative spending. The higher net loss in the fourth quarter of 2021 is primarily attributed to higher R&D spending and an increase in interest expense, as well as the expense related to the impairment of fixed assets. The higher net loss in the third quarter of 2021 is primarily attributed to higher R&D spending and an increase in interest expense partially offset by lower general, selling and administrative spending. The higher net loss in the second quarter of 2021 is primarily attributed to higher general, selling, administrative spending partially offset by higher licensing revenue and lower R&D spending.

26

LIQUIDITY AND CAPITAL RESOURCES

	For the three months ended											For the six months ended
	May 31,		May 31,									May 31,		May 31,
	2023		2022									2023		2022
	(unaudited)		(unaudited)			Change						(unaudited)		(unaudited)			Change
	$		$			$			%			$		$			$			%
Cash flows provided from (used in) operating activities		89,728		(338,569	)		428,297			-127	%		75,552		(899,150	)		974,702			-108	%
Cash flows provided from (used in) investing activities		-		500,000			(500,000	)		N/A			-		500,000			(500,000	)		N/A
Increase (decrease) in cash		89,728		161,431			(71,703	)		-44	%		75,552		(399,150	)		474,702			-119	%
Cash, beginning of period		69,546		211,364			(141,818	)		-67	%		83,722		771,945			(688,223	)		-89	%
Cash, end of period		159,274		372,795			(213,521	)		-57	%		159,274		372,795			(213,521	)		-57	%

The Company had cash of $159,274 as at May 31, 2022 compared to $372,795 as at May 31, 2022.

For the three months ended May 31, 2023, net cash flows used in operating activities increased to $89,728 as compared to net cash flows provided from operating activities of $338,569 for the three months ended May 31, 2022. The increase was primarily a result of the increase in accounts receivable, prepaid expenses and accrued liabilities offset by a decrease in accounts payable, and a lower loss from operations.

R&D costs, which are a portion of the cash flows used in operating activities, related to continued internal R&D programs, are expensed as incurred. However, equipment and supplies are capitalized and amortized over their useful lives if they have alternative future uses. For the three months ended May 31, 2023 and the three months ended May 31, 2022, R&D expense were $377,507, and $825,673, respectively. The decrease is mainly due to the allocation of losses from royalty revenue to R&D expense in the six months ended May 31, 2022.

For the three and six months ended May 31, 2023, net cash flows from Investing activities were $Nil each period, compared to $500,000 for the three and six months ended May 31, 2022. The investing activities in the three and six months ended May 31, 2022 was related to the sale of equipment.

All non-cash items have been added back or deducted from the condensed unaudited interim consolidated statements of cash flows.

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With the exception of the quarter ended February 28, 2014, the Company has incurred losses from operations since inception. To date, the Company has funded its R&D activities principally through the issuance of securities, loans from related parties, funds from the IPC Arrangement Transaction and funds received under commercial license agreements. Since November 2013, research has also been funded from revenues earned on sales of our generic Focalin XR® capsules for the 15 and 30 mg strengths. Despite the launch of the 25 and 35 mg strengths by Par in January 2017, the launch of the 10 and 20 mg strengths in May 2017 along with the launch of the 5 and 40 mg strengths in November 2017, we expect sales of generic Focalin XR®, due to continued competitive pressures, to continue to be negatively impacted for the next several quarters.  As of May 31, 2023, our cash balance was $159,274. We currently expect to meet our short-term cash requirements from potential revenues for approved generic products or other collaborations, other available financing and by cost savings resulting from reduced R&D activities and staffing levels, as well as quarterly profit share from Par. Effective May 5, 2021 our exclusive license agreements with Tris Pharma, Inc. for generic Seroquel XR^®, generic Pristiq^® and generic Effexor XR^® were mutually terminated. Products were never supplied nor distributed under the licenses. Termination of the exclusive agreements may provide opportunity for the Company to explore options of supplying the products to multiple sources on non-exclusive bases. However, there can be no assurance that the products previously licensed to Tris Pharma will be successfully commercialized and produce significant revenues for us. We will need to obtain additional funding to, among other things, further product commercialization activities and development of our product candidates. The Company recently entered into a license and supply agreement with Taro Pharmaceuticals Inc. by which the Company has granted Taro an exclusive license to market, sell and distribute a product in Canada. There can be no assurance that the product will be successfully commercialized and produce significant revenues for us. Potential sources of capital may include, if conditions permit, equity and/or debt financing, payments from licensing and/or development agreements and/or new strategic partnership agreements. The Company has funded its business activities principally through the issuance of securities, loans from related parties (see “Related Party Transactions” for more information related to the terms of such loans and applicable maturities) and funds from development agreements. There is no certainty that such funding will be available going forward or, if it is, whether it will be sufficient to meet our needs.  Our future operations are highly dependent upon our ability to source additional funding to support advancing our product candidate pipeline through continued R&D activities and to expand our operations. Our ultimate success will depend on whether our product candidates are approved by the FDA, Health Canada, or the regulatory authorities of other countries in which our products are proposed to be sold and whether we are able to successfully market our approved products.  We cannot be certain that we will receive such regulatory approval for any of our current or future product candidates, that we will reach the level of revenues necessary to achieve and sustain profitability, or that we will secure other capital sources on terms or in amounts sufficient to meet our needs, or at all. Our cash requirements for R&D during any period depend on the number and extent of the R&D activities we focus on. At present, we are focused principally on the development of 505(b)(2) product candidates, such as our Regabatin™ XR and Oxycodone ER 505(b)(2) product candidates and selected generic product candidates as resources permit. Our development of Oxycodone ER required significant expenditures, including costs to defend against the Purdue (as defined below) litigation (as described in the “Legal Proceedings and Regulatory Actions” section). Some of these costs remain to be paid by the Company.  For our Regabatin™ XR product candidate, Phase III clinical trials can be capital intensive, and will only be undertaken consistent with the availability of funds and a prudent cash management strategy.

On September 10, 2018, the Company completed a private placement financing of the unsecured convertible 2018 Debenture in the principal amount of $0.5 million. The 2018 Debenture was originally scheduled to mature on September 1, 2020. The 2018 Debenture bears interest at a rate of 10% per annum, payable monthly, is pre-payable at any time at the option of the Company and is convertible at any time into common shares of the Company at a conversion price of $3.00 per common share at the option of the holder. The maturity date for the 2018 Debenture has been extended from time to time and the maturity date is currently August 31, 2023. No interest was paid on the 2018 Debenture for the three and six months ended May 31, 2023.

On April 4, 2019, a tentative approval from TSX was received for refinancing of the 2013 Debenture subject to certain conditions being met. As a result of the refinancing, the principal amount owing under the 2013 Debenture was refinanced by the May 2019 Debenture. On May 1, 2019, the May 2019 Debenture was issued in the principal amount of $1,050,000, was originally scheduled to mature on November 1, 2019, bears interest at a rate of 12% per annum and is convertible into 1,779,661 common shares of the Company at a conversion price of $0.59 per common share. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors, and executive officers of the Company, are the holders of the May 2019 Debenture. The maturity date for the May 2019 Debenture has been extended from time to time and the maturity date for the May 2019 Debenture is currentlyAugust 31, 2023. No interest was paid on the May 2019 Debenture for thethree and six months ended May 31, 2023.

On November 15, 2019, the Company completed a private placement financing of the unsecured November 2019 Debenture in the principal amount of $0.25 million. The November 2019 Debenture was originally scheduled to mature on December 31, 2019. The November 2019 Debenture bears interest at a rate of 12% per annum, payable monthly, is pre-payable at any time at the option of the Company and is convertible at any time into common shares of the Company at a conversion price of $0.12 per common share at the option of the holder. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors and executive officers of the Company provided the Company with the $0.25 million of proceeds for the November 2019 Debenture. The maturity date for the November 2019 Debenture has been extended from time to time and the maturity date for the November 2019 Debenture is currently August 31, 2023. No interest was paid on the November 2019 Debenture for the three and six months ended May 31, 2023.

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The availability of equity or debt financing will be affected by, among other things, the results of our R&D, our ability to obtain regulatory approvals, our success in commercializing approved products with our commercial partners and the market acceptance of our products, the state of the capital markets generally, our delisting from Nasdaq, strategic alliance agreements, and other relevant commercial considerations. In addition, if we raise additional funds by issuing equity securities, our then existing security holders will likely experience dilution, and the incurring of indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would restrict our operations. In the event that we do not obtain sufficient additional capital, it will raise substantial doubt about our ability to continue as a going concern, realize our assets and pay our liabilities as they become due. Our cash outflows are expected to consist primarily of internal and external R&D, legal and consulting expenditures to advance our product pipeline and selling, general and administrative expenses to support our commercialization efforts.  Depending upon the results of our R&D programs, the impact of the litigation against us and the availability of financial resources, we could decide to accelerate, terminate, or reduce certain projects, or commence new ones.  Any failure on our part to successfully commercialize approved products or raise additional funds on terms favorable to us or at all, may require us to significantly change or further curtail our current or planned operations in order to conserve cash until such time, if ever, that sufficient proceeds from operations are generated, and could result in us not taking advantage of business opportunities, in the termination or delay of clinical trials or us not taking any necessary actions required by the FDA or Health Canada for one or more of our product candidates, in curtailment of our product development programs designed to identify new product candidates, in the sale or assignment of rights to our technologies, products or product candidates, and/or our inability to file ANDAs, ANDSs or NDAs at all or in time to competitively market our products or product candidates.

In March 2019, we received formal notice that a Nasdaq Panel had determined to delist our shares from Nasdaq based upon our non-compliance with the $1.00 bid price requirement, as set forth in Nasdaq Listing Rule 5550(a)(2). The suspension of trading on Nasdaq took effect at the open of business on March 21, 2019. Our shares began trading on the OTCQB under the symbol “IPCIF”, commencing on March 21, 2019. Our shares are also listed on the TSX under the symbol “IPCI” and our non-compliance with Nasdaq's requirements did not impact our listing or trading status on that exchange.

OUTSTANDING SHARE INFORMATION

As at May 31, 2023, the Company had 33,092,665 common shares issued and outstanding. There have been no changes to common shares since February 28, 2023. The number of options outstanding as of May 31, 2023 is 1,309,000. The warrants outstanding as of May 31, 2023 represent 21,160,314 common shares issuable upon the exercise of 21,160,314 outstanding warrants.  During the three months ended May 31, 2023, no deferred share units (“DSUs”) were exercised and converted into common shares. The number of DSUs outstanding as of May 31, 2023 is Nil. As of July 14, 2023 the number of common shares outstanding is 33,092,665.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT LIQUIDITY AND MARKET RISK

Liquidity risk is the risk that we will encounter difficulty raising liquid funds to meet our commitments as they fall due. In meeting our liquidity requirements, we closely monitor our forecasted cash requirements with expected cash drawdown.

We are exposed to interest rate risk, which is affected by changes in the general level of interest rates. Due to the fact that our cash is deposited with major financial institutions in an interest savings account, we do not believe that the results of operations or cash flows would be affected to any significant degree by a sudden change in market interest rates given their relative short-term nature.

Trade accounts receivable potentially subjects us to credit risk. We provide an allowance for doubtful accounts equal to the estimated losses expected to be incurred in the collection of accounts receivable.

The following table sets forth details of the aged accounts receivable that are not overdue as well as an analysis of overdue amounts and the related allowance for doubtful accounts:

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	May 31,		November 30,
	2023		2022
Accounts receivable		333,582		602
Less allowance for doubtful accounts		-		-
Total trade and other receivables, net		333,582		602
Not past due		333,582		602
Past due for more than 31 days
but no more than 120 days		-		-
Past due for more than 120 days		-		-
Total trade and other receivables, gross		333,582		602

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of uncollateralized accounts receivable. The Company’s maximum exposure to credit risk is equal to the potential amount of financial assets. For the three months ended May 31, 2023, one customer accounted for all the revenues and for all the accounts receivable of the Company.

The Company is also exposed to credit risk at period end from the carrying value of its cash. The Company manages this risk by maintaining bank accounts with a Canadian Chartered Bank. The Company’s cash is not subject to any external restrictions.

We are exposed to changes in foreign exchange rates between the Canadian and U.S. Dollar which could affect the value of our cash. We had no foreign currency hedges or other derivative financial instruments as of May 31, 2023. The Company did not enter into financial instruments for trading or speculative purposes and we do not currently utilize derivative financial instruments.

We have balances in Canadian dollars that give rise to exposure to foreign exchange risk relating to the impact of translating certain non-U.S. Dollar balance sheet accounts as these statements are presented in U.S. Dollars. A strengthening U.S. Dollar will lead to a foreign exchange loss while a weakening U.S. Dollar will lead to a foreign exchange gain. For each Canadian dollar balance of $1.0 million, a +/- 10% movement in the Canadian currency held by us versus the U.S. Dollar would affect our loss and other comprehensive loss by $0.1 million.

WORKING CAPITAL

Working capital (defined as current assets minus current liabilities) has decreased by approximately $0.3 million from November 30, 2022 to May 31, 2023, mainly as a result of an increase in accounts receivable, prepaid expenses, accrued liabilities and employee costs payable and decrease in accounts payable. We continue to explore partnership opportunities for both currently approved and yet-to-be-approved products, as well as potential international partnership opportunities for both existing and future products. We have reduced R&D and other activities, and the number of employees because of the financial condition of the Company. While the Company has some flexibility with its level of expenditures, our future operations are highly dependent upon our ability to source additional capital to support advancing our product pipeline through continued R&D activities and to fund any significant expansion of our operations. Our ultimate success will depend on whether our product candidates receive the approval of the FDA, Health Canada, and the regulatory authorities of other countries in which our products are proposed to be sold and whether we are able to successfully market our approved products. We cannot be certain that we will receive FDA, Health Canada, or such other regulatory approval for any of our current or future product candidates, that we will reach the level of sales and revenues necessary to achieve and sustain profitability, or that we can secure other capital sources on terms or in amounts sufficient to meet our needs, or at all.

As an R&D company, we are eligible to receive investment tax credits from various levels of government under the SR&ED incentive programs. Depending on the financial condition of our operating subsidiary, Intellipharmaceutics Corp., R&D expenses in any fiscal year could be claimed. Eligible R&D expenses include salaries for employees involved in R&D, cost of materials, new equipment purchase as well as third party contract services. This amount is not a reduction in income taxes, but a form of government refundable credits based on the level of R&D that we carry out.

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In January 2013, the Company completed the private placement financing of the unsecured 2013 Debenture in the original principal amount of $1.5 million. The 2013 Debenture bore interest at a rate of 12% per annum, payable monthly, was pre-payable at any time at the option of the Company and was convertible at any time into common shares at a conversion price of $30.00 per common share at the option of the holder. Drs. Isa and Amina Odidi, who are directors, executive officers and shareholders of our Company, provided us with the original $1.5 million of the proceeds for the 2013 Debenture. In December 2016, a principal repayment of $150,000 was made on the 2013 Debenture and the maturity date was extended. In December 2018, a principal repayment of $300,000 was made on the 2013 Debenture and the maturity date was extended. The maturity date for the 2013 Debenture was extended from time to time until it was refinanced into the May 2019 Debenture on May 1, 2019.

On April 4, 2019, a tentative approval from TSX was received for refinancing of the 2013 Debenture subject to certain conditions being met. As a result of the refinancing, the principal amount owing under the 2013 Debenture was refinanced by the May 2019 Debenture. On May 1, 2019, the May 2019 Debenture was issued in the principal amount of $1,050,000, was originally scheduled to mature on November 1, 2019, bears interest at a rate of 12% per annum and is convertible into 1,779,661 common shares of the Company at a conversion price of $0.59 per common share. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors, and executive officers of the Company, are the holders of the May 2019 Debenture. The maturity date for the May 2019 Debenture has been extended from time to time and the maturity date for the May 2019 Debenture is currentlyAugust 31, 2023. No interest was paid on the May 2019 Debenture for the three and six months ended May 31, 2023.

On September 10, 2018, the Company completed a private placement financing of the 2018 Debenture in the principal amount of $0.5 million. The 2018 Debenture was scheduled to mature on September 1, 2020. The 2018 Debenture bears interest at a rate of 10% per annum, payable monthly, is pre-payable at any time at the option of the Company and is convertible at any time into common shares at a conversion price of $3.00 per common share at the option of the holder. Drs. Isa and Amina Odidi, who are directors, executive officers and shareholders of our Company, provided the original $500,000 of the proceeds for the 2018 Debenture. The maturity date for the 2018 Debenture has been extended from time to time and the maturity date for the 2018 Debenture is currently August 31, 2023. No interest was paid on the May 2019 Debenture for the three and six months ended May 31, 2023.

On November 15, 2019, the Company completed a private placement financing of the unsecured convertible November 2019 Debenture in the principal amount of $0.25 million. The November 2019 Debenture was originally scheduled to mature on December 31, 2019. The November 2019 Debenture bears interest at a rate of 12% per annum, payable monthly, is pre-payable at any time at the option of the Company and is convertible at any time into common shares of the Company at a conversion price of $0.12 per common share at the option of the holder. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors and executive officers of the Company provided the Company with the $0.25 million of proceeds for the November 2019 Debenture.The maturity date for the November 2019 Debenture has been extended from time to time and the maturity date for the November 2019 Debenture is currently August 31, 2023. No interest was paid on the May 2019 Debenture for the three and six months ended May 31, 2023.

CONTRACTUAL OBLIGATIONS

In the table below, we set forth our enforceable and legally binding obligations and future commitments and obligations related to all contracts. Some of the figures we include in this table are based on management’s estimate and assumptions about these obligations, including their duration, the possibility of renewal, anticipated actions by third parties, and other factors. Current operating lease obligations relate to the lease of premises for the Company’s premises that it operates from at 30 Worcester Road. The Company had a lease for this as well as the adjoining property at 22 Worcester Road, which is indirectly owned by the same landlord, which expired in November 2020. On June 21, 2020, the Company entered into a lease surrender agreement and vacated the property at 22 Worcester Road on June 30, 2020. On August 20, 2020, the Company extended its lease for the premises (30 Worcester Road) that it currently operates from, for one year, commencing December 1, 2020, with an option to continue on a month-to-month basis after November 30, 2021. Effective December 1, 2021, the Company extended its lease for the premises (30 Worcester Road) for one year with an option to renew for another year; the current lease expires November 30, 2023.

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The following are the contractual maturities of the undiscounted cash flows of financial liabilities as at May 31, 2023:

	Less than		3 to 6		6 to 9		9 months		Greater than
	3 months		months		months		to 1 year		1 year		Total
	$		$		$		$		$		$
Accounts payable		3,672,776		-		-		-		-		3,672,776
Accrued liabilities		3,284,320		-		-		-		-		3,284,320
Employee costs payable		3,491,952		-		-		-		-		3,491,952
Operating lease liabiity		45,891		45,891		-		-		-		91,782
Convertible debentures		1,800,000		-		-		-		-		1,800,000
Promissory notes payable		359,454		-		-		-		-		359,454
Total contractual obligations		12,654,393		45,891		-		-		-		12,700,284

CONTINGENCIES AND LITIGATION

From time to time, we may be exposed to claims and legal actions in the normal course of business. As at May 31, 2023, and continuing as at July 11, 2023, we are not aware of any pending or threatened material litigation claims against us, other than as described below.

In November 2016, we filed an NDA for our Oxycodone ER product candidate, relying on the 505(b)(2) regulatory pathway, which allowed us to reference data from Purdue's file for its OxyContin® extended-release oxycodone hydrochloride. Our Oxycodone ER application was accepted by the FDA for further review in February 2017. We certified to the FDA that we believed that our Oxycodone ER product candidate would not infringe any of the OxyContin® patents listed in the Orange Book, or that such patents are invalid, and so notified Purdue and the other owners of the subject patents listed in the Orange Book of such certification.

On April 7, 2017, we received notice that Purdue, Purdue Pharmaceuticals L.P., The P.F. Laboratories, Inc., or collectively the Purdue parties, Rhodes Technologies, and Grünenthal GmbH, or collectively the “Purdue litigation plaintiffs”, had commenced patent infringement proceedings, or the Purdue litigation, against us in the U.S. District Court for the District of Delaware (docket number 17-392) in respect of our NDA filing for Oxycodone ER, alleging that our proposed Oxycodone ER infringes 6 out of the 16 patents associated with the branded product OxyContin®, or the OxyContin® patents, listed in the Orange Book.

Subsequent to the above-noted filing of lawsuit, 4 further such patents were listed and published in the Orange Book. On March 16, 2018, we received notice that the Purdue litigation plaintiffs had commenced further such patent infringement proceedings adding the 4 further patents. On April 15, 2020, Purdue filed a new patent infringement suit against the Company relating to additional Paragraph IV certifications lodged against two more listed Purdue patents.

As a result of the commencement of the first of these legal proceedings, the FDA was stayed for 30 months from granting final approval to our Oxycodone ER product candidate. That time period commenced on February 24, 2017, when the Purdue litigation plaintiffs received notice of our certification concerning the patents, and would expire on August 24, 2019, unless the stay is earlier terminated by a final declaration of the courts that the patents are invalid, or are not infringed, or the matter is otherwise settled among the parties. On April 24, 2019, an order was issued, setting a trial date of November 12, 2019 for case number 17-392 in the District of Delaware, and also extending the 30-month stay date for regulatory approval to March 2, 2020.

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On or about June 26, 2018, the court issued an order to sever 6 “overlapping” patents from the second Purdue case but ordered litigation to proceed on the 4 new (2017-issued) patents. An answer and counterclaim was filed on July 9, 2018. On July 6, 2018, the court issued a so-called “Markman” claim construction ruling on the first case. On July 24, 2018, the parties to the case mutually agreed to and did have dismissed without prejudice the infringement claims related to the Grünenthal ‘060 patent, which is one of the six patents included in the original litigation case.

On October 4, 2018, the parties mutually agreed to postpone the scheduled court date pending a case status conference scheduled for December 17, 2018. At that time, further trial scheduling and other administrative matters were postponed pending the Company’s resubmission of the Oxycodone ER NDA to the FDA, which was made on February 28, 2019. On January 17, 2019, the court issued a scheduling order in which the remaining major portions are scheduled. The trial was scheduled for June 2020.

On April 4, 2019, the U.S. Federal Circuit Court of Appeals affirmed the invalidity of one Purdue OxyContin® formulation patent, subject to further appeal to the U.S. Supreme Court.

Following the filing of a bankruptcy stay by Purdue Pharma L.P., the Company’s ongoing litigation case numbers 1:17-cv-00392-RGA and 1:18-cv-00404-RGA-SRF between Purdue Pharma L.P. et al and Intellipharmaceutics were stayed and the existing trial dates in both cases vacated by orders issued in each case by the judge in the District of Delaware on October 4, 2019. With the litigation stay order, the previous 30-month stay date of March 2, 2020 was unchanged.

On or about July 2, 2020 the parties in the cases, numbers 17-cv-392-RGA, 18-cv-404-RGA and 20-cv-515-RGA (the “Litigations”) between Purdue Pharma L.P. et al (“Purdue’) and Intellipharmaceutics entered into a stipulated dismissal of the Litigations.The stipulated dismissal, which was subject to approval by the bankruptcy court presiding over Purdue Pharma’s pending chapter 11 cases, provides for the termination of the patent infringement proceedings. The stipulated dismissal also provides that (i) for a thirty (30) day period following a final approval of the Company’s Aximris XR^TM NDA the parties will attempt to resolve any potential asserted patent infringement claims relating to the NDA and (ii) if the parties fail to resolve all such claims during such period Purdue Pharma will have fifteen (15) days to pursue an infringement action against the Company. The terms of the stipulated dismissal agreement are confidential. On July 28, 2020 the United States District Court for the District of Delaware signed the stipulations of dismissal into order thereby dismissing the claims in the three cases without prejudice. In consideration of the confidential stipulated dismissal agreement and for future saved litigation expenses, Purdue paid an amount to the Company.

In July 2017, three complaints were filed in the U.S. District Court for the Southern District of New York that were later consolidated under the caption Shanawaz v. Intellipharmaceutics Int’l Inc., et al., No. 1:17-cv-05761 (S.D.N.Y.). The lead plaintiffs filed a consolidated amended complaint on January 29, 2018.  In the amended complaint, the lead plaintiffs assert claims on behalf of a putative class consisting of purchasers of our securities between May 21, 2015 and July 26, 2017. The amended complaint alleges that the defendants violated Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder by making allegedly false and misleading statements or failing to disclose certain information regarding our NDA for Oxycodone ER abuse-deterrent oxycodone hydrochloride extended-release tablets. The complaint seeks, among other remedies, unspecified damages, attorneys’ fees and other costs, equitable and/or injunctive relief, and such other relief as the court may find just and proper.

On November 7, 2019 the Company announced that the parties reached a settlement that was subject to the approval of the court following notice to class members. The stipulation of settlement provides for a settlement payment of US$1.6 million by the Company, which has been paid from available insurance coverage. As part of the settlement, the Company also agreed to contribute to the settlement fund specific anticipated Canadian tax refunds of up to US$400,000 to the extent received within 18 months after the entry of final judgment. The stipulation of settlement acknowledges that the Company and the other defendants continue to deny that they committed any violation of the U.S. securities laws or engaged in any other wrongdoing and that they are entering into the settlement at this time based on the burden, expense, and inherent uncertainty of continuing the litigation.

On December 7, 2020 the court approved the settlement and entered an order and final judgement to that effect, thereby concluding the case.

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On February 21, 2019, the Company and its CEO, Dr. Isa Odidi, were served with a Statement of Claim filed in the Superior Court of Justice of Ontario for a proposed class action under the Ontario Class Proceedings Act. The Action was brought by Victor Romita, the proposed representative plaintiff, on behalf of a class of Canadian persons who traded shares of the Company during the period from February 29, 2016 to July 26, 2017. The Statement of Claim, under the caption Victor Romita v. Intellipharmaceutics International Inc. and Isa Odidi, asserted that the defendants knowingly or negligently made certain public statements during the relevant period that contained or omitted material facts concerning Oxycodone ER abuse-deterrent oxycodone hydrochloride extended-release tablets. The plaintiff alleged that he and the class suffered loss and damages as a result of their trading in the Company’s shares during the relevant period. The plaintiff sought, among other remedies, unspecified damages, legal fees and court and other costs as the Court may permit. On February 26, 2019, the plaintiff delivered a Notice of Motion seeking the required approval from the Court, in accordance with procedure under the Ontario Securities Act, to allow the statutory claims under the Ontario Securities Act to proceed with respect to the claims based upon the acquisition or disposition of the Company’s shares on the TSX during the relevant period.  On January 28, 2020 the plaintiff served a Notice of Motion for leave to amend the Statement of Claim. On April 2, 2020 the plaintiff delivered an Amended Motion Record and Amended Notice of Motion seeking an order for leave to issue a fresh as Amended Statement of Claim including the addition of Christopher Pearce as a Plaintiff (“Amendment Motion”). On May 1, 2020, the court granted the plaintiff’s Amendment Motion.An order for leave to proceed for settlement purposes was granted on 25 June 2021. At a hearing on 12 October 2021, the Court approved the settlement. The stipulation of settlement provides for a settlement payment of CAD$266,000 by the Company, CAD$226,000 was paid from insurance coverage while the Company paid CAD$40,000. Therefore, this action is now settled.

On October 7, 2019, a complaint was filed in the U.S. District Court for the Southern District of New York by Alpha Capital Anstalt (“Alpha”) against the Company, two of its existing officers and directors and its former Chief Financial Officer. In the complaint, Alpha alleged that the Company and the executive officers/directors named in the complaint violated Sections 11, 12(a)(2) and 15 of the U.S. Securities Act of 1933, as amended, by allegedly making false and misleading statements in the Company’s Registration Statement on Form F-1 filed with the U.S. Securities and Exchange Commission on September 20, 2018, as amended, by failing to disclose certain information regarding the resignation of the Company’s then Chief Financial Officer, which was announced several weeks after such registration statement was declared effective.  In the complaint, Alpha sought unspecified damages, rescission of its purchase of the Company’s securities in the relevant offering, attorneys’ fees and other costs and further relief as the court may find just and proper. On December 12, 2019, the Company and the other defendants in the action filed a motion to dismiss for failure to state a claim. The plaintiff filed an opposition to that motion on February 4, 2020 and a reply brief in further support of the motion to dismiss the action was filed March 6, 2020. In addition, the Court scheduled a mandatory settlement conference with the Magistrate Judge for April 23, 2020 which the Company and its counsel attended. On June 18, 2020, the court largely denied the Company’s motion to dismiss the action. Briefing on these motions was completed on February 19, 2021.In a court order filed July 9, 2021, the District Court issued an opinion and order granting summary judgment in the Company’s favor and ordered the case closed. The judgment was entered on July 12, 2021. On August 10, 2021, the Plaintiff filed a notice of appeal. On October 1, 2021, the Plaintiff filed a notice of voluntary dismissal of the appeal with prejudice, stipulated to by the Company. The Court of Appeals “so ordered” the voluntary dismissal stipulation and the appeal was dismissed. As a result, the matter has been fully resolved in favor of the Company and the named individual Defendants.  

On or about August 5, 2020 a former employee filed a claim against the Company for wrongful dismissal of employment plus loss of benefits, unpaid vacation pay, interest and costs. The parties have agreed to settlement terms in the matter. The Company has fulfilled the terms and has received a release and consent to dismiss. A dismissal order is pending from the court.

On or about August 9, 2022, a service provider brought to the Company’s attention a Motion Record to seek judgement with respect to amounts owed it by the Company for the principal amount owed, plus pre-judgment interest and costs. We found out then, that a statement of claim dated May 3, 2021 was delivered to the Company’s premises.  The Company did not respond to the claim because it was inadvertently never brought to the attention of management, as a result the Company was noted in default in May 31, 2021. The Company was not aware of the claim and the default before August 9, 2022. The Company signed a consent which allows the other party to obtain judgement from a court and take steps to enforce judgement if we default on certain conditions.

34

RELATED PARTY TRANSACTIONS

In January 2013, the Company completed the private placement financing of the unsecured 2013 Debenture in the original principal amount of $1.5 million. The 2013 Debenture bore interest at a rate of 12% per annum, payable monthly, was pre-payable at any time at the option of the Company and was convertible at any time into common shares at a conversion price of $30.00 per common share at the option of the holder. Drs. Isa and Amina Odidi, who are directors, executive officers and shareholders of our Company, provided us with the original $1.5 million of the proceeds for the 2013 Debenture. In December 2016, a principal repayment of $150,000 was made on the 2013 Debenture and the maturity date was extended until April 1, 2017. The maturity date for the 2013 Debenture was further extended from time to time. In December 2018, a principal repayment of $300,000 was made on the 2013 Debenture. On April 4, 2019, a tentative approval from TSX was received for refinancing of the 2013 Debenture subject to certain conditions being met. As a result of the refinancing, the principal amount owing under the 2013 Debenture was refinanced by the May 2019 Debenture. On May 1, 2019, the May 2019 Debenture was issued in the principal amount of $1,050,000, was originally scheduled to mature on November 1, 2019, bears interest at a rate of 12% per annum and is convertible into 1,779,661 common shares of the Company at a conversion price of $0.59 per common share. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors, and executive officers of the Company, are the holders of the May 2019 Debenture.The maturity date for the May 2019 Debenture has been extended from time to time and the maturity date for the May 2019 Debenture is currently August 31, 2023.

On September 10, 2018, the Company completed the 2018 Debenture Financing. The 2018 Debenture bears interest at a rate of 10% per annum, payable monthly, may be prepaid at any time at our option, and is convertible into common shares at any time prior to the maturity date at a conversion price of $3.00 per common share at the option of the holder. Drs. Isa and Amina Odidi, who are directors, executive officers and shareholders of our Company, provided us with the original $500,000 of proceeds for the 2018 Debenture. The 2018 Debenture was scheduled to mature on September 1, 2020.The net proceeds of the 2018 Debenture were used for working capital and general corporate purposes. The maturity date for the 2018 Debenture has been extended from time to time and the maturity date is currently August 31, 2023.

In September 2019, the Company issued two promissory notes payable. The notes are unsecured, non-interest bearing with no fixed repayment terms, in the amounts of US$6,500 and CDN$203,886, and payable to Dr. Isa Odidi and Dr. Amina Odidi, who are stockholders, directors and executive officers of the Company. The proceeds from such notes were used for working capital and general corporate purposes.

On November 15, 2019, the Company issued the November 2019 Debenture, an unsecured convertible debenture in the principal amount of $250,000 that was originally scheduled to mature on December 31, 2019, bears interest at a rate of 12% per annum and is convertible into common shares of the Company at a conversion price of $0.12 per share. The Company used the proceeds from the November 2019 Debenture for working capital and general corporate purposes. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors, and executive officers of the Company, are the holders of the November 2019 Debenture. The maturity date for the November 2019 Debenture has been extended from time to time and the maturity date for the November 2019 Debenture is now August 31, 2023.

No interest was paid on any of the September 2018, May 2019 and November 2019 Debentures during the three and six months ended May 31, 2023.

35

To the Company’s knowledge, Armistice Capital Master Fund, Ltd. and/or its affiliates, previously a holder of in excess of 10% of the Company’s outstanding common shares, participated in (i) a registered direct offering in October 2017, pursuant to a placement agent agreement dated October 10, 2017 between the Company and H.C. Wainwright & Co., LLC (“Wainwright”), and (ii) the registered direct offerings completed in March 2018, pursuant to placement agent agreements dated March 12, 2018 and March 18, 2018 between the Company and Wainwright; and (iii) the underwritten public offering completed in October 2018. Armistice Capital, LLC, Armistice Capital Master Fund, Ltd., and Steven Boyd reported on a Schedule 13-G/A, filed with the SEC on February 14, 2019, that it was the beneficial owner of less than 10% of the Company’s Common Shares. A subsequent Schedule 13G filed with the SEC on February 16, 2021, reported that Armistice was the beneficial owner of 2,627,978, representing approximately 9.99% of the Company’s common shares at the time. A subsequent Schedule 13G filed with the SEC on February 16, 2022, reported that Armistice was the beneficial owner of 3,672,877, representing approximately 9.99% of the Company’s common shares at the time. The most recent Schedule 13G filed February 14, 2023 reported that Armistice was the beneficial owner of 3,672,877 common shares, representing approximately 9.99%. Sabby Volatility Warrant Master Fund, Ltd. and its affiliates reported on a Schedule 13-G/A, filed with the SEC on January 21, 2020, that they were each the beneficial owner of 1,101,571 common shares of the Company, representing approximately 4.65% of the Company’s common shares at the time.

The Company’s Corporate Governance Committee, made up of independent directors, oversees any potential transaction and negotiation that could give rise to a related party transaction or create a conflict of interest, and conducts an appropriate review.

DISCLOSURE CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including the Chief Executive Officer and the acting Chief Financial Officer, we have evaluated the effectiveness of our disclosure controls and procedures as of May 31, 2023. Disclosure controls and procedures are designed to ensure that the information required to be disclosed by the Company in the reports it files or submits under securities legislation is recorded, processed, summarized and reported on a timely basis and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and acting Chief Financial Officer, as appropriate, to allow required disclosures to be made in a timely fashion. Based on that evaluation, management has concluded that these disclosure controls and procedures were effective as of May 31, 2023.

INTERNAL CONTROL OVER FINANCIAL REPORTING

The management of our Company is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with generally accepted accounting principles and includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Company’s receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.

Management assessed the effectiveness of the Company’s internal control over financial reporting using the 1992 Internal Control-Integrated Framework developed by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

Based on this assessment, management concluded that the Company’s internal control over financial reporting was effective as of May 31, 2023.

In the second quarter of 2017, we initiated the transition from the COSO 1992 Internal Control - Integrated Framework to the COSO 2013 Internal Control - Integrated Framework. Management has completed the business risk and information technology components and is working towards completion of controls over financial reporting as well as fraud risk.  We currently expect the transition to this new framework to continue through the fiscal year 2023. Although we do not expect to experience significant changes in internal control over financial reporting as a result of our transition, we may identify significant deficiencies or material weaknesses and incur additional costs in the future as a result of our transition.

Changes in Internal Control over Financial Reporting

During the three months ended May 31, 2023, there were no changes made to the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting, and specifically, there were no changes in accounting functions, board or related committees and charters, or auditors; no functions, controls or financial reporting processes of any constituent entities were adopted as the Company’s functions, controls and financial processes; and no other significant business processes were implemented.

36

OFF-BALANCE SHEET ARRANGEMENTS

The Company, as part of its ongoing business, does not participate in transactions that generate relationships with unconsolidated entities or financial partnerships, such as entities often referred to as structured finance or special purpose entities (“SPE”), which would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes. As of May 31, 2023, the Company was not involved in any material unconsolidated SPE transactions.

RISKS AND UNCERTAINTIES

We are a R&D company that received final FDA approval of our once daily generic Focalin XR® capsules for the 15 and 30 mg strengths in November 2013. We depend significantly on the actions of our marketing partner Par in the prosecution, regulatory approval and commercialization of our generic Focalin XR® capsules and on their timely payment to us of the contracted calendar quarterly payments as they come due. Our near-term ability to generate significant revenue will depend upon successful commercialization of our products in the U.S., where the branded Focalin XR® product is in the market. Although we have several other products in our pipeline, and received final approval from the FDA for our generic Keppra XR® (levetiracetam extended-release tablets) for the 500 and 750 mg strengths, final approval from the FDA for our generic Glucophage XR® in the 500 and 750 mg strengths, final approval from the FDA for our generic Effexor XR® in the 37.5, 75, and 150 mg strengths and of our generic Seroquel XR®, and final approval from the FDA for our generic Pristiq® (desvenlafaxine extended-release tablets) in the 50 and 100 mg strengths, the majority of the products in our pipeline are at earlier stages of development. We continue to explore licensing and commercial alternatives for our generic Seroquel XR®, generic Effexor XR®, generic Pristiq®, generic Glucophage XR® and generic Keppra XR®, product strengths that have been approved by the FDA. The Company has entered into a license and supply agreement with Taro by which the Company has granted Taro an exclusive license to market, sell and distribute in Canada, Desvenlafaxine Extended-release Tablets (generic Pristiq) in the 50 mg and 100 mg strengths that is approved for sale in the Canadian market. However there can be no assurance that the product will be successfully commercialized and/or produce significant revenue for us. Potential licensing and commercial alternatives for these products include licensing and distribution deals for regions outside of North America. Because of these characteristics, the Company is subject to certain risks and uncertainties, or risk factors. The Company cannot predict or identify all such risk factors nor can it predict the impact, if any, of the risk factors on its business operations or the extent to which a factor, event or any such combination may materially change future results of financial position from those reported or projected in any forward looking statements. Accordingly, the Company cautions the reader not to rely on reported financial information and forward-looking statements to predict actual future results. This document and the accompanying financial information should be read in conjunction with this statement concerning risks and uncertainties. Some of the risks, uncertainties and events that may affect the Company, its business, operations and results of operations are given in this section. However, the factors and uncertainties are not limited to those stated.

We believe that the revenues derived from our generic Focalin XR® capsules are subject to wholesaler buying patterns, increased generic competition negatively impacting price, margins and market share consistent with industry post-exclusivity experience and, to a lesser extent, seasonality (as these products are indicated for conditions including attention deficit hyperactivity disorder which we expect may see increases in prescription rates during the school term and declines in prescription rates during the summer months). Accordingly, these factors may cause our operating results to fluctuate.

Since we commenced operations, we have incurred accumulated losses through May 31, 2023. We had an accumulated deficit of $105,543,958 as of May 31, 2023 and have incurred additional losses since such date. As we engage in the development of products in our pipeline, we will continue to incur further losses. There can be no assurance that we will ever be able to achieve or sustain profitability or positive cash flow. Our ultimate success will depend on whether our product candidates receive the approval by the FDA, Health Canada, and the regulatory authorities of the other countries in which our products are proposed to be sold and whether we are able to successfully market the approved products. We cannot be certain that we will be able to receive FDA, Health Canada, or such other regulatory approval for any of our current or future product candidates, that we will reach the level of sales and revenues necessary to achieve and sustain profitability, or that we can secure other capital sources on terms or in amounts sufficient to meet our needs, or at all.

37

Our business requires substantial capital investment in order to conduct the R&D, clinical and regulatory activities and to defend against patent litigation claims in order to bring our products to market and to establish commercial manufacturing, marketing and sales capabilities. In the event that we do not obtain sufficient additional capital, it will raise substantial doubt about our ability to continue as a going concern, realize our assets, and pay our liabilities as they become due.

Nasdaq delisted our common shares from trading on its exchange which could limit investors’ ability to make transactions in our shares and subject us to additional trading restrictions. Subsequent to Nasdaq delisting our shares from trading on its exchange, our shares are quoted in the over-the-counter market on the OTCQB. We could face material adverse consequences due to the delisting of our shares from Nasdaq, including: (i) a limited availability of market quotations for our shares; (ii) reduced liquidity for our shares; (iii) a determination that our common shares are “penny stock” which will require brokers trading in our common shares to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our shares; (iv) a limited amount of news and analyst coverage; and (v) restrictions on our ability to issue additional securities or obtain additional financing in the future.

Our cash outflows are expected to consist primarily of internal and external R&D, legal and consulting expenditures to advance our product pipeline and selling, general and administrative expenses to support our commercialization efforts. Depending upon the results of our R&D programs, the impact of the litigation against us and the availability of financial resources, we could decide to accelerate, terminate, or reduce certain projects, or commence new ones. Any failure on our part to successfully commercialize approved products or raise additional funds on terms favorable to us, or at all, may require us to significantly change or curtail our current or planned operations in order to conserve cash until such time, if ever, that sufficient proceeds from operations are generated, and could result in us not taking advantage of business opportunities, in the termination or delay of clinical trials or in not taking any necessary actions required by the FDA or Health Canada for one or more of our product candidates, in curtailment of our product development programs designed to identify new product candidates, in the sale or assignment of rights to our technologies, products or product candidates, and/or in our inability to file ANDAs, ANDSs or NDAs at all or in time to competitively market our products or product candidates.

We set goals regarding the expected timing of meeting certain corporate objectives, such as the commencement and completion of clinical trials, anticipated regulatory approval and product launch dates. From time to time, we may make certain public statements regarding these goals. The actual timing of these events can vary dramatically due to, among other things, insufficient funding, delays or failures in our clinical trials or bioequivalence studies, the uncertainties inherent in the regulatory approval process, such as failure to secure requested product labeling approvals, requests for additional information, delays in achieving manufacturing or marketing arrangements necessary to commercialize our product candidates and failure by our collaborators, marketing and distribution partners, suppliers and other third parties to fulfill contractual obligations. In addition, the possibility of a patent infringement suit, such as the Purdue litigation, regarding one or more of our product candidates could delay final FDA approval of such candidates and materially adversely affect our ability to market our products. Even if we are found not to infringe Purdue’s or any other plaintiff’s patent claims or the claims are found invalid or unenforceable, defending any such infringement claims could be expensive and time-consuming and could distract management from their normal responsibilities. If we fail to achieve one or more of our planned goals, the price of our common shares could decline.

From late 2019 the Company has had to reduce development activities and staffing levels significantly due to ongoing financial problems which have continued, coupled with the effects of the Covid-19 pandemic. It is not possible to reliably estimate the length and severity of the developments and impact on the future financial results and condition of the Company. The challenges and uncertainties could impair the Company’s ability to raise capital,postpone research activities, impact our ability to maintain operations and launch new products; it could also impair the value of our shares, our long-lived assets, and materially adversely impact our ability to generate potential future revenue.

Further risks and uncertainties affecting us can be found elsewhere in this document, in our latest Annual Information Form, our latest Form F-1 and F-3 registration statements, each as amended or supplemented (including any documents forming a part thereof or incorporated by reference therein), and our latest Form 20-F, as amended, and other public documents filed on SEDAR and EDGAR.

ADDITIONAL INFORMATION

Additional information relating to the Company, including the Company’s latest Annual Information Form, our latest Form F-1 and F-3 registration statements, each as amended or supplemented (including any documents forming a part thereof or incorporated by reference therein), and latest Form 20-F, as amended, can be located under the Company’s profile on the SEDAR website at www.sedar.com and on the EDGAR section of the SEC’s website at www.sec.gov.

38

EX-99.2

EXHIBIT 99.2

Condensed unaudited interim consolidated financial statements of

Intellipharmaceutics

International Inc.

May 31, 2023

Page 1

Intellipharmaceutics International Inc.

May 31, 2023

Table of contents

Condensed unaudited interim consolidated balance sheets	2
Condensed unaudited interim consolidated statements of operations and comprehensive loss	3
Condensed unaudited interim consolidated statements of shareholders’ equity (deficiency)	4
Condensed unaudited interim consolidated statements of cash flows	5
Notes to the condensed unaudited interim consolidated financial statements	6-22

Page 2

NOTICE OF NO AUDITOR REVIEW OF INTERIM FINANCIAL STATEMENTS

Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.

The accompanying unaudited condensed interim consolidated financial statements of the Company have been prepared by and are the responsibility of the Company’s management.

The Company’s independent auditor has not performed a review of these financial statements in accordance with standards established by the Chartered Professional Accountants Canada for a review of interim financial statements by an entity’s auditor.

Page 3

Intellipharmaceutics International Inc.
Consolidated balance sheets
As at
(Stated in U.S. dollars)
	May 31,			November 30,
	2023			2022
	$			$
Assets
Current
Cash		159,274			83,722
Trade and other receivables, net		333,582			602
Investment tax credits		268,179			268,179
Prepaid expenses and other assets		192,411			140,008
		953,446			492,511
Property and equipment, net (Note 4)		706,760			788,050
Right-of-use asset (Note 6)		75,204			151,471
		1,735,410			1,432,032
Liabilities
Current
Accounts payable		3,672,776			3,764,692
Accrued liabilities		3,284,320			2,821,506
Employee costs payable		3,491,952			3,067,578
Operating lease liability (Note 6)		84,466			165,441
Income tax payable		29,036			29,036
Promissory notes payable (Note 5)		359,454			360,514
Convertible debentures (Note 5)		1,800,000			1,800,000
		12,722,004			12,008,767
Shareholders' deficiency
Capital stock (Note 7)
Authorized
Unlimited common shares without par value
Unlimited preference shares
Issued and outstanding
33,092,665 common shares		49,175,630			49,175,630
(November 30, 2020 - 23,678,105)
Additional paid-in capital		45,097,313			45,097,313
Accumulated other comprehensive income		284,421			284,421
Accumulated deficit		(105,543,958	)		(105,134,099	)
		(10,986,594	)		(10,576,735	)
Contingencies (Note 12)
		1,735,410			1,432,032
Going Concern (Note 1)
See accompanying notes to the condensed unaudited interim consolidated financial statements

Page 4

Intellipharmaceutics International Inc.
Condensed unaudited interim consolidated statements of operations and comprehensive loss
For the three and six months ended May 31, 2023 and 2022
(Stated in U.S. dollars)
	Three months ended						Six months ended
	May 31, 2023			May 31, 2022			May 31, 2023			May 31, 2022
	$			$			$			$
Revenue
Licensing (Note 3)		480,203			-			806,546			-
Other revenue		-			-			-			16,978
		480,203			-			806,546			16,978
Expenses
Research and development		377,507			956,851			825,673			1,434,408
Selling, general and administrative		93,504			243,501			232,339			504,359
Depreciation (Note 4)		40,547			51,479			81,289			102,957
		511,558			1,251,831			1,139,301			2,041,724
Loss from operations		(31,355	)		(1,251,831	)		(332,755	)		(2,024,746	)
Net foreign exchange gain		29,122			(15,357	)		25,544			(22,851	)
Interest expense		(51,888	)		(73,466	)		(102,648	)		(174,029	)
Gain on disposal of assets		-			500,000			-			500,000
Net loss and comprehensive loss		(54,121	)		(840,654	)		(409,859	)		(1,721,626	)
Loss per common share, basic and diluted		(0.002	)		(0.03	)		(0.01	)		(0.05	)
Weighted average number of common
shares outstanding, basic and diluted		33,092,665			33,092,665			33,092,665			33,092,665
See accompanying notes to condensed unaudited interim consolidated financial statements

Page 5

Intellipharmaceutics International Inc.                                                                                                                                                                                                                                                                                                                                            

Condensed unaudited interim consolidated statements of shareholders' equity (deficiency)

For the six months ended May 31, 2023 and 2022                                                                                                                                                                                                                                                                                       

(Stated in U.S. dollars)

							Accumulated					Total
					Additional		other					shareholders'
			Capital stock		paid-in		comprehensive		Accumulated			equity
	Number		amount		capital		income		deficit			(deficiency)
			$		$		$		$			$
Balance, November 30, 2021		33,092,665		49,175,630	$	44,626,436		284,421		(102,241,705	)		(8,155,218	)
Beneficial conversion feature related to Debentures (Note 5)		-		-		20,833		-		-			20,833
Net loss		-		-		-		-		(1,721,626	)		(1,721,626	)
Balance, May 31, 2022		33,092,665		49,175,630	$	44,647,269		284,421		(103,963,331	)		(9,856,011	)
Balance, November 30, 2022		33,092,665		49,175,630	$	45,097,313		284,421		(105,134,099	)		(10,576,735	)
Net loss		-		-		-		-		(409,859	)		(409,859	)
Balance, May 31, 2023		33,092,665		49,175,630	$	45,097,313		284,421		(105,543,958	)		(10,986,594	)

See accompanying notes to condensed unaudited interim consolidated financial statements

Page 6

Intellipharmaceutics International Inc.
Condensed unaudited interim consolidated statements of cash flows
For the three and six months ended May 31, 2023 and 2022
(Stated in U.S. dollars)
	Three months ended						Six months ended
	May 31, 2023			May 31, 2022			May 31, 2023			May 31, 2022
	$			$			$			$
Net loss		(54,121	)		(840,654	)		(409,859	)		(1,721,626	)
Items not affecting cash
Depreciation		40,547			51,479			81,289			102,957
Accreted interest		-			20,834			-			69,351
Non-cash lease expense		(6,682	)		490			4,708			1,042
Gain on disposal of assets		-			(500,000	)		-			(500,000	)
Unrealized foreign exchange (gain) loss		(10,472	)		629			(10,477	)		1,812
Change in non-cash operating assets & liabilities
Accounts receivable		(122,055	)		37,353			(332,980	)		-
Prepaid expenses, sundry and other assets		(6,296	)		40,006			(52,403	)		(205,121	)
Accounts payable, accrued liabilities and employee costs payable		248,807			851,294			795,274			1,352,435
Cash flows provided from (used in) operating activities		89,728			(338,569	)		75,552			(899,150	)
Investing activities
Sale of property and equipment		-			500,000			-			500,000
Cash flows provided from investing activities		-			500,000			-			500,000
Increase (decrease) in cash		89,728			161,431			75,552			(399,150	)
Cash, beginning of period		69,546			211,364			83,722			771,945
Cash, end of period		159,274			372,795			159,274			372,795
See accompanying notes to condensed unaudited interim consolidated financial statements

Page 7

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

1. Nature of operations

Intellipharmaceutics International Inc. (the “Company”) is a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs.

On October 22, 2009, IntelliPharmaCeutics Ltd. (“IPC Ltd. “) and Vasogen Inc. completed a court approved plan of arrangement and merger (the “IPC Arrangement Agreement”), resulting in the formation of the Company, which is incorporated under the laws of Canada. The Company’s common shares are traded on the Toronto Stock Exchange (“TSX”) and the OTCQB Venture Market.

The Company earns revenue from non-refundable upfront fees, milestone payments upon achievement of specified research or development, exclusivity milestone payments and licensing and cost-plus payments on sales of resulting products. In November 2013, the U.S. Food and Drug Administration (“FDA”) granted the Company final approval to market the Company’s first product, the 15 mg and 30 mg strengths of the Company’s generic Focalin XR® (dexmethylphenidate hydrochloride extended-release) capsules. In 2017, the FDA granted final approval for the remaining 6 (six) strengths, all of which have been launched. In May 2017, the FDA granted the Company final approval for its second commercialized product, the 50, 150, 200, 300 and 400 mg strengths of generic Seroquel XR® (quetiapine fumarate extended release) tablets, and the Company commenced shipment of all strengths that same month. In November 2018, the FDA granted the Company final approval for its venlafaxine hydrochloride extended-release capsules in the 37.5, 75, and 150 mg strengths.

Going concern

The condensed unaudited interim consolidated financial statements are prepared on a going concern basis, which assumes that the Company will be able to meet its obligations and continue its operations for the next twelve months. The Company has incurred losses from operations since inception and has reported losses of $54,121 and $409,859 for the three and six months ended May 31, 2023 (three and six months ended May 31, 2022 - $840,654 and $1,721,626) and has an accumulated deficit of $105,543,958 as at May 31, 2023 (November 30, 2022 - $105,134,099). The Company has a working capital deficiency of $10,986,594 as atMay 31, 2023 (November 30, 2022 – $11,516,252). The Company has funded its research and development (“R&D”) activities principally through the issuance of securities, loans from related parties, funds from the IPC Arrangement Agreement, and funds received under development agreements. There is no certainty that such funding will be available going forward. These conditions raise substantial doubt about its ability to continue as a going concern and realize its assets and pay its liabilities as they become due.

In order for the Company to continue as a going concern and fund any significant expansion of its operation or R&D activities, the Company will require significant additional capital. Although there can be no assurances, such funding may come from revenues from the sales of the Company’s generic Focalin XR® (dexmethylphenidate hydrochloride extended-release) capsules, from revenues from the sales of the Company’s generic Seroquel XR® (quetiapine fumarate extended-release) tablets and from potential partnering opportunities. Other potential sources of capital may include payments from licensing agreements, cost savings associated with managing operating expense levels, other equity and/or debt financings, and/or new strategic partnership agreements which fund some or all costs of product development. The Company’s ultimate success will depend on whether its product candidates receive the approval of the FDA, Health Canada, and the regulatory authorities of the other countries in which its products are proposed to be sold and whether it is able to successfully market approved products. The Company cannot be certain that it will receive FDA, Health Canada, or such other regulatory approval for any of its current or future product candidates, or that it will reach the level of sales and revenues necessary to achieve and sustain profitability, or that the Company can secure other capital sources on terms or in amounts sufficient to meet its needs, or at all.

The availability of equity or debt financing will be affected by, among other things, the results of the Company’s R&D, its ability to obtain regulatory approvals, its success in commercializing approved products with its commercial partners and the market acceptance of its products, the state of the capital markets generally, the delisting from Nasdaq (as defined below), strategic alliance agreements, and other relevant commercial considerations.

Page 8

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

1. Nature of operations (continued)

Going concern (continued)

In addition, if the Company raises additional funds by issuing equity securities, its then existing security holders will likely experience dilution, and the incurring of indebtedness would result in increased debt service obligations and could require the Company to agree to operating and financial covenants that would restrict its operations. In the event that the Company does not obtain sufficient additional capital, it will raise substantial doubt about the Company’s ability to continue as a going concern, realize its assets and pay its liabilities as they become due. The Company’s cash outflows are expected to consist primarily of internal and external R&D, legal and consulting expenditures to advance its product pipeline and selling, general and administrative expenses to support its commercialization efforts. Depending upon the results of the Company’s R&D programs, the impact of the litigation against the Company and the availability of financial resources, the Company could decide to accelerate, terminate, or reduce certain projects, or commence new ones. Any failure on its part to successfully commercialize approved products or raise additional funds on terms favorable to the Company or at all, may require the Company to significantly change or curtail its current or planned operations in order to conserve cash until such time, if ever, that sufficient proceeds from operations are generated, and could result in the Company not taking advantage of business opportunities, in the termination or delay of clinical trials or the Company not taking any necessary actions required by the FDA or Health Canada for one or more of the Company’s product candidates, in curtailment of the Company’s product development programs designed to identify new product candidates, in the sale or assignment of rights to its technologies, products or product candidates, and/or its inability to file Abbreviated New Drug Applications (“ANDAs”), Abbreviated New Drug Submissions (“ANDSs”) or New Drug Applications (“NDAs”) at all or in time to competitively market its products or product candidates.

The condensed unaudited interim consolidated financial statements do not include any adjustments that might result from the outcome of uncertainties described above. If the going concern assumption no longer becomes appropriate for these condensed unaudited interim consolidated financial statements, then adjustments would be necessary to the carrying values of assets and liabilities, the reported expenses and the balance sheet classifications used. Such adjustments could be material.

2. Basis of presentation

(a) Basis of consolidation

These condensed unaudited interim consolidated financial statements include the accounts of the Company and its wholly owned operating subsidiaries, IPC Ltd., Intellipharmaceutics Corp., and Vasogen Corp.

References in these condensed unaudited interim consolidated financial statements to share amounts, per share data, share prices, exercise prices and conversion rates have been adjusted to reflect the effect of the 1-for-10 reverse stock split (known as a share consolidation under Canadian law) (the “reverse split”) which became effective on each of The Nasdaq Stock Market LLC (“Nasdaq”) and TSX at the opening of the market on September 14, 2018. The term “share consolidation” is intended to refer to such reverse split and the terms “pre-consolidation” and “post-consolidation” are intended to refer to “pre-reverse split” and “post-reverse split”, respectively.

In September 2018, the Company announced the reverse split. At a special meeting of the Company’s shareholders held on August 15, 2018, the Company’s shareholders granted the Company’s Board of Directors discretionary authority to implement a share consolidation of the issued and outstanding common shares of the Company on the basis of a share consolidation ratio within a range from five (5) pre-consolidation common shares for one (1) post-consolidation common share to fifteen (15) pre-consolidation common shares for one (1) post-consolidation common share. The Board of Directors selected a share consolidation ratio of ten (10) pre-consolidation shares for one (1) post-consolidation common share. On September 12, 2018, the Company filed an amendment to the Company’s articles ("Articles of Amendment") to implement the 1-for-10 reverse split.

Page 9

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

2. Basis of presentation (continued)

(a) Basis of consolidation (continued)

The Company’s common shares began trading on each of Nasdaq and TSX on a post-split basis under the Company’s existing trade symbol “IPCI” at the opening of the market on September 14, 2018. In accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), the change was applied retroactively.

The condensed unaudited interim consolidated financial statements do not conform in all respects to the annual requirements of U.S. GAAP. Accordingly, these condensed unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended November 30, 2022.

These condensed unaudited interim consolidated financial statements have been prepared using the same accounting policies and methods as those used by the Company in the annual audited consolidated financial statements for the year ended November 30, 2022.

The condensed unaudited interim consolidated financial statements reflect all adjustments necessary for the fair presentation of the Company’s financial position and results of operation for the interim periods presented. All such adjustments are normal and recurring in nature.

All inter-company accounts and transactions have been eliminated on consolidation.

(b) Use of estimates

The preparation of the condensed unaudited interim consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates.

Areas where significant judgment is involved in making estimates are the determination of the functional currency; the fair values of financial assets and liabilities, valuation of convertible debt; the determination of units of accounting for revenue recognition; the accrual of licensing and milestone revenue; and forecasting future cash flows for assessing the going concern assumption.

From late 2019 the Company has had to reduce development activities and staffing levels significantly due to ongoing financial problems which have continued, coupled with the effects of the Covid-19 pandemic. It is not possible to reliably estimate the length and severity of the developments and impact on the future financial results and condition of the Company. The challenges and uncertainties could impair the Company’s ability to raise capital,postpone research activities, impact our ability to maintain operations and launch new products; it could also impair the value of our shares, our long-lived assets, and materially adversely impact our ability to generate potential future revenue.

3. Significant accounting policies

(a) Revenue recognition

The Company accounts for revenue in accordance with the provisions of ASC Topic 606 Revenue from Contracts with Customers. Under ASC Topic 606, the Company recognizes revenue when the customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed under ASC Topic 606: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation(s). The Company earns revenue from non-refundable upfront fees, milestone payments upon achievement of specified research or development, exclusivity milestone payments and licensing payments on sales of resulting products.

The relevant revenue recognition accounting policy is applied to each separate unit of accounting.

Page 10

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

3. Significant accounting policies (continued)

(a) Revenue recognition (continued)

Licensing

The Company recognizes revenue from the licensing of the Company's drug delivery technologies, products and product candidates. Under the terms of the licensing arrangements, the Company provides the customer with a right to access the Company’s intellectual property with regards to the license which is granted. Revenue arising from the license of intellectual property rights is recognized over the period the Company transfers control of the intellectual property.

The Company has a license and commercialization agreement with Par Pharmaceutical Inc. (“Par”). Under the exclusive territorial license rights granted to Par, the agreement requires that Par manufacture, promote, market, sell and distribute the product. Licensing revenue amounts receivable by the Company under this agreement are calculated and reported to the Company by Par, with amounts generally based upon net product sales and net profit which include estimates for chargebacks, rebates, product returns, and other adjustments. Licensing revenue payments received by the Company from Par under this agreement are not subject to further deductions for chargebacks, rebates, product returns, and other pricing adjustments. Based on this arrangement and the guidance per ASC Topic 606, the Company records licensing revenue over the period the Company transfers control of the intellectual property in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

Milestones

For milestone payments that are not contingent on sales-based thresholds, the Company applies a most-likely amount approach on a contract-by-contract basis. Management makes an assessment of the amount of revenue expected to be received based on the probability of the milestone outcome. Variable consideration is included in revenue only to the extent that it is probable that the amount will not be subject to a significant reversal when the uncertainty is resolved (generally when the milestone outcome is satisfied).

Research and development

Under arrangements where the license fees and research and development activities can be accounted for as a separate unit of accounting, non-refundable upfront license fees are deferred and recognized as revenue on a straight-line basis over the expected term of the Company's continued involvement in the research and development process.

Deferred revenue

Deferred revenue represents the funds received from clients, for which the revenues have not yet been earned, as the milestones have not been achieved, or in the case of upfront fees for drug development, where the work remains to be completed. As of November 30, 2022, the Company has recorded a deferred revenue balance of $Nil (November 30, 2021 - $Nil) due to the termination of its license and commercial supply agreement with Mallinckrodt.

(b) Research and development costs

Research and development costs related to continued research and development programs are expensed as incurred in accordance with ASC Topic 730 Research and Development. However, materials and equipment are capitalized and amortized over their useful lives if they have alternative future uses.

(c) Translation of foreign currencies

Transactions denominated in currencies other than the Company and its wholly owned operating subsidiaries’ functional currencies, monetary assets and liabilities are translated at the period end rates. Revenue and expenses are translated at rates of exchange prevailing on the transaction dates. All of the exchange gains or losses resulting from these other transactions are recognized in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

The functional and reporting currency of the Company and its subsidiaries is the U.S. dollar.

Page 11

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

3. Significant accounting policies (continued)

(d) Investment tax credits

The investment tax credits (“ITC") receivable are amounts considered recoverable from the Canadian federal and provincial governments under the Scientific Research & Experimental Development (“SR&ED”) incentive program. The amounts claimed under the program represent the amounts based on management estimates of eligible research and development costs incurred during the year. Realization is subject to government approval. Any adjustment to the amounts claimed will be recognized in the year in which the adjustment occurs. Refundable ITCs claimed relating to capital expenditures are credited to property and equipment. Refundable ITCs claimed relating to current expenditures are netted against research and development expenditures.

(e) Loss per share

Basic loss per share (“EPS”) is computed by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive.

The dilutive effect of stock options is determined using the treasury stock method.

4. Property and equipment

	Computer equipment		Computer software		Furniture and fixtures		Laboratory equipment		Leasehold improvements		Total
	$		$		$		$		$		$
Cost
Balance at November 30, 2021		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Impairment of asset		-		-		-		-		-		-
Balance at November 30, 2022		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Balance at February 28, 2023		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Accumulated depreciation
Balance at November 30, 2021		565,088		154,500		150,991		4,157,060		1,441,452		6,469,091
Depreciation		19,874		924		4,301		180,959		-		206,058
Balance at November 30, 2022		584,962		155,424		155,292		4,338,019		1,441,452		6,675,149
Depreciation		6,972		214		14,095		60,010		-		81,291
Balance at May 31, 2023		591,934		155,638		169,387		4,398,029		1,441,452		6,756,440
Net book value at:
November 30, 2022		46,372		635		17,206		723,838		-		788,051
May 31, 2023		39,400		421		3,111		663,828		-		706,760

Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Impairment is assessed by comparing the carrying amount of an asset with the sum of the undiscounted cash flows expected from its use and disposal, and as such requires the Company to make significant estimates on expected revenues from the commercialization of its products and services and the related expenses. The Company records a write-down for long-lived assets which have been abandoned and do not have any residual value. Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that

Page 12

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

4. Property and equipment (continued)

the carrying value of an asset may not be recoverable. Impairment is assessed by comparing the carrying amount of an asset with the sum of the undiscounted cash flows expected from its use and disposal, and as such requires the Company to make significant estimates on expected revenues from the commercialization of its products and services and the related expenses. The Company records a write-down for long-lived assets which have been abandoned and do not have any residual value.

5. Convertible debentures and promissory notes payable

(a) Convertible debentures

Amounts due to the related parties are payable to two shareholders who are also officers and directors of the Company.

	May 31,		November 30,
	2023		2022
Convertible debenture payable to two directors and officers of the
Company, unsecured, 10% annual interest rate,
payable monthly (“2018 Debenture”)	$	500,000	$	500,000
Convertible debenture payable to two directors and officers of the
Company, unsecured, 12% annual interest rate,
payable monthly (“May 2019 Debenture”)		1,050,000		1,050,000
Convertible debenture payable to two directors and officers of the
Company, unsecured, 12% annual interest rate,
payable monthly (“November 2019 Debenture”)		250,000		250,000
	$	1,800,000	$	1,800,000

On September 10, 2018, the Company completed a private placement financing of the unsecured convertible 2018 Debenture in the principal amount of $0.5 million. The 2018 Debenture matured on September 1, 2020. The 2018 Debenture bore interest at a rate of 10% per annum, payable monthly, was pre-payable at any time at the option of the Company and was convertible at any time into common shares of the Company at a conversion price of $3.00 per common share at the option of the holder. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors and executive officers of the Company provided the Company with the $0.5 million of the proceeds for the 2018 Debenture.

At issuance, as the conversion price was lower than the market share price, the beneficial conversion feature valued at September 10, 2018 of $66,667 was allocated to Additional paid-in capital. Subsequently, the fair value of the 2018 Debenture was accreted over the remaining life of the 2018 Debenture using an effective rate of interest of 7.3%. Effective September 1, 2020, the maturity date for the 2018 Debenture was further extended to November 30, 2020. Under ASC Subtopic 470-50, the change in the debt instrument was accounted for as an extinguishment of debt. At the date of extinguishment, the Company derecognized the carrying amount of convertible debt of $0.5 million and recorded the new convertible debt at the fair value of $0.5 million, resulting in no gain or loss. The carrying amount of the debt instrument is accreted over the remaining life of the 2018 Debenture using a nominal effective rate of interest. As of November 30, 2022 the maturity date for the 2018 Debenture was further extended to August 31, 2023.

Effective May 31, 2022, the maturity date for the May 2019 Debenture was further extended to November 30, 2022. Under ASC Subtopic 470-50, the change in the debt instrument was accounted for as an extinguishment of debt. At the date of extinguishment, the Company derecognized the carrying amount of convertible debt of $1,050,000 and recorded the new convertible debt at the fair value of $1,050,000, resulting in no gain or loss. The carrying amount of the debt instrument is accreted over the remaining life of the May 2019 Debenture using a nominal effective rate of interest. As of November 30, 2022 the maturity date for the May 2019 Debenture was further extended to August 31, 2023.

Page 13

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

5. Convertible debentures and promissory notes payable (continued)

(a) Convertible debentures (continued)

Effective May 31, 2022, the maturity date for the November 2019 Debenture was further extended to November 30, 2022. Under ASC Subtopic 470-50, the change in the debt instrument was accounted for as an extinguishment. In accordance with ASC paragraph 470-50-40-2, extinguishment transactions between related entities are treated as capital transactions. At the date of extinguishment, the Company derecognized the carrying amount of convertible debt of $250,000 and recorded the new convertible debt at the fair value of $250,000, resulting in no gain or loss. The carrying amount of the debt instrument is accreted over the remaining life of the November 2019 Debenture using a nominal effective rate of interest. As of November 30, 2022 the maturity date for the November 2019 Debenture was further extended to August 31, 2023.

Accreted interest expense during the three and six months ended May 31, 2023 is $Nil and $Nil (three and six months ended May 31, 2022 is $20,834 and $69,351) and has been included in interest expense in the condensed unaudited interim consolidated statements of operations and comprehensive loss. In addition, the coupon interest on the 2018 Debenture, May 2019 Debenture and November 2019 Debenture (collectively, the “Debentures”) for the three and six months ended May 31, 2023 is $51,888 and $102,648 (three and six months ended May 31, 2022 – $51,888 and $102,648) and has also been included in interest expense in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

(b) Promissory notes payable

	May 31,		November 30,
	2023		2022
	$		$
Promissory notes payable to two directors and officers
of the Company, unsecured, no annual interest
rate on the outstanding loan balance		156,377		157,437
Promissory notes payable to third party
unsecured, 10% annual interest
rate on the outstanding loan balance		203,077		203,077
		359,454		360,514

In September 2019, the Company issued two unsecured, non-interest bearing promissory notes, with no fixed repayment terms, in the amounts of US$6,500 and CDN$203,886, to Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors and executive officers of the Company.

In October 2022, the Company issued an unsecured, 10% annual interest bearing promissory note, with a 6 month fixed repayment term, in the amount of US$200,000.

6. Lease

On December 1, 2015, the Company entered into a new lease agreement for the premises that it currently operates from, as well the adjoining property, which is owned by the same landlord, for a 5-year term with a 5-year renewal option. On June 21, 2020, the Company entered into a lease surrender agreement and vacated one of its premises on June 30, 2020. On August 20, 2020, The Company extended its lease for the premises that it currently operates from, for one year, commencing December 1, 2020, with an option to continue on a month-to-month basis after November 30, 2021.This operating lease was capitalized under ASC Topic 842 effective on the August 20, 2020 date of extension.

The gross amounts of assets and liabilities related to operating leases were as follows:

6. Lease (continued)

Page 14

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

	May 31, 2023		November 30, 2022
Assets:
Operating lease right-of-use asset	$	75,204	$	151,471
Liabilities:
Current:
Operating lease liability	$	84,466	$	165,441
Total lease liability	$	84,466	$	165,441

For the three months ended May 31, 2023, lease payments of $87,293 were paid in relation to the operating lease liability.

Lease terms and discount rates are as follows:

	May 31, 2023
Remaining lease term (months)		6
Estimated incremental borrowing rate		11.4	%

The approximate future minimum lease payments for the operating lease as at May 31, 2023 were as follows:

	May 31, 2023
Lease payments for remainder of year	$	87,293
Less imputed interest		2,827
Present value of lease liabilities	$	84,466

7. Capital stock

Authorized, issued and outstanding

(a) The Company is authorized to issue an unlimited number of common shares, all without nominal or par value and an unlimited number of preference shares. As at May 31, 2023, the Company had 33,092,665 (May 31, 2022 – 33,092,665) common shares issued and outstanding and no preference shares issued and outstanding. Two officers and directors of the Company owned directly and through their family holding company 578,131 (November 30, 2022 – 578,131) common shares or approximately 1.7% (November 30, 2022 – 1.7%) of the issued and outstanding common shares of the Company as at May 31, 2023.

Each common share of the Company entitles the holder thereof to one vote at any meeting of shareholders of the Company, except meetings at which only holders of a specified class of shares are entitled to vote.

Holders of common shares of the Company are entitled to receive, as and when declared by the board of directors of the Company, dividends in such amounts as shall be determined by the board.

The holders of common shares of the Company have the right to receive the remaining property of the Company in the event of liquidation, dissolution, or winding-up of the Company, whether voluntary or involuntary.

The preference shares may at any time and from time to time be issued in one or more series. The board of directors will, by resolution, from time to time, before the issue thereof, fix the rights, privileges, restrictions and conditions attaching to the preference shares of each series. Except as required by law, the holders of any series of preference shares will not as such be entitled to receive notice of, attend or vote at any meeting of the shareholders of the Company. Holders of preference shares will be entitled to preference with respect to payment of dividends and the distribution of

Page 15

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

7. Capital stock (continued)

assets in the event of liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs, on such shares over the common shares of the Company and over any other shares ranking junior to the preference shares.

In April 2021, the Company completed a private placement offering of an aggregate of 9,414,560 common shares at a price of CAD$0.41 per Common Share. The Company recorded $3,069,448 44as the value of common shares under Capital stock in 3. The direct costs related to the issuance of the common shares were $38,220. These direct costs were recorded as an offset against the condensed unaudited interim consolidated statements of shareholders’ equity (deficiency).

8. Options

All grants of options to employees after October 22, 2009 are made from the Employee Stock Option Plan (the “Employee Stock Option Plan”). The maximum number of common shares issuable under the Employee Stock Option Plan is limited to 10% of the issued and outstanding common shares of the Company from time to time, or 3,309,267 based on the number of issued and outstanding common shares as at May 31, 2023. As at May 31, 2023, 1,309,000 options are outstanding and there were 2,000,267 options available for grant under the Employee Stock Option Plan. Each option granted allows the holder to purchase one common share at an exercise price not less than the closing price of the Company's common shares on the TSX on the last trading day prior to the grant of the option. Options granted under these plans typically have a term of 5 years with a maximum term of 10 years and generally vest over a period of up to three years.

In the three and six months ended May 31, 2023, Nil (three and six months ended May 31, 2022 –- Nil) stock options were granted.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes Option-Pricing Model, consistent with the provisions of ASC Topic 718. Compensation—Stock Compensation Option pricing models require the use of subjective assumptions, changes in these assumptions can materially affect the fair value of the options. The Company calculates expected volatility based on historical volatility of the Company’s own volatility for options that have an expected life of less than ten years. The expected term, which represents the period of time that options granted are expected to be outstanding, is estimated based on the historical average of the term and historical exercises of the options. The risk-free rate assumed in valuing the options is based on the U.S. treasury yield curve in effect at the time of grant for the expected term of the option.

The expected dividend yield percentage at the date of grant is Nil as the Company is not expected to pay dividends in the foreseeable future.

Details of stock option transactions in Canadian dollars (“C$”) are as follows:

	May 31, 2023						May 31, 2022
			Weighted							Weighted
			average		Weighted					average		Weighted
			exercise		average					exercise		average
	Number of		price per		grant date		Number of			price per		grant date
	options		share		fair value		options			share		fair value
	#		$		$		#			$		$
Outstanding, beginning of period		1,309,000		0.35		0.27		1,489,500			2.40		1.80
Expired		-		-		-		(85,000	)		32.70		25.08
Outstanding, end of period		1,309,000		0.35		0.27		1,404,500			0.55		0.38
Options exercisable, end of period		1,309,000		0.35		0.27		1,404,500			0.55		0.38

Page 16

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

8. Options (continued)

Total unrecognized compensation cost relating to the unvested performance-based stock options at May 31, 2023 is $Nil (May 31, 2022 - $Nil).

For the three and six months ended May 31, 2023 and 2022, no options were exercised.

The Company has estimated its stock option forfeitures to be approximately 4% for the three and six months ended May 31, 2023 (three and six months ended May 31, 2022 – 4%).

9. Deferred share units

Effective May 28, 2010, the Company’s shareholders approved a Deferred Share Unit (“DSU”) Plan to grant DSUs to its non-management directors and reserved a maximum of 11,000 common shares for issuance under the plan. The DSU Plan permits certain non-management directors to defer receipt of all or a portion of their board fees until termination of the board service and to receive such fees in the form of common shares at that time. A DSU is a unit equivalent in value to one common share of the Company based on the trading price of the Company's common shares on the TSX.

Upon termination of board service, the director will be able to redeem DSUs based upon the then market price of the Company's common shares on the date of redemption in exchange for any combination of cash or common shares as the Company may determine.

During the three and six months ended May 31, 2023, no non-management board members elected to receive director fees in the form of DSUs under the Company’s DSU Plans. As at May 31, 2023, Nil (May 31, 2022 Nil) DSUs were outstanding and 11,000 (May 31, 2022 – 11,000) DSUs were available for grant under the DSU Plan.

During the three and six months ended May 31, 2023 and 2022, no DSUs were exercised.

10. Warrants

All of the Company’s outstanding warrants are considered to be indexed to the Company’s own stock and are therefore classified as equity under ASC 480.Topic 480 Distinguishing Liabilities from Equity. The warrants, in specified situations, provide for certain compensation remedies to a holder if the Company fails to timely deliver the shares underlying the warrants in accordance with the warrant terms.

The following table provides information on the 21,160,314 warrants, including 2018 Firm Warrants, outstanding and exercisable as of May 31, 2023:

	Exercise		Number			Shares issuable
Warrant	price ($)		outstanding		Expiry	upon exercise
2018 Firm Warrants		0.75		20,000,000	October 16, 2023		20,000,000
October 2018 Placement Agent Warrants		0.9375		1,160,314	October 16, 2023		1,160,314
				21,160,314			21,160,314

During the three and six months ended May 31, 2023, there were no cash exercises in respect of warrants (three and six months ended May 31, 2022 – Nil).

Details of warrant transactions for the six months ended May 31, 2023 and 2022 are as follows:

	Outstanding,  December 1, 2022		Issued		Expired		Exercised		Outstanding,  May 31,  2023
2018 Firm Warrants		20,000,000		-		-		-		20,000,000
October 2018 Placement
Agent Warrants		1,160,314		-		-		-		1,160,314
		21,160,314		-		-		-		21,160,314

Page 17

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

10. Warrants (continued)

	Outstanding,  December 1, 2021		Issued		Expired		Exercised		Outstanding,  May 31,  2022
2018 Firm Warrants		20,000,000		-		-		-		20,000,000
October 2018 Placement
Agent Warrants		1,160,314		-		-		-		1,160,314
		21,160,314		-		-		-		21,160,314

11. Income Taxes

The Company has had no taxable income under the Federal and Provincial tax laws of Canada for the three months ended 2023 and May 31, 2022. The Company has non-capital loss carry-forwards at May 31, 2023 in Canada $62,493,624 that must be offset against future taxable income. If not utilized, the loss carry-forwards will expire between 2028 and 2042.

For the three and six months ended May 31, 2022, the Company had a cumulative carry-forward pool of Canadian Federal Scientific Research & Experimental Development expenditures in the amount of approximately $15,951,739, which can be carried forward indefinitely.

For the three and six months ended May 31, 2022, the Company had approximately $2,933,013 of unclaimed Investment Tax Credits which expire from 2025 to 2040. These credits are subject to a full valuation allowance as they are not more likely than not to be realized.

12. Contingencies

From time to time, the Company may be exposed to claims and legal actions in the normal course of business. As at May 31, 2023, and continuing as at July 14, 2023, the Company is not aware of anypending or threatenedmateriallitigation claimsagainst the Company, other than as described below.

In November 2016, the Company filed an NDA for its Oxycodone ER product candidate, relying on the 505(b)(2) regulatory pathway, which allowed the Company to reference data from Purdue Pharma L.P's (“Purdue”) file for its OxyContin® extended release oxycodone hydrochloride. The Oxycodone ER application was accepted by the FDA for further review in February 2017. The Company certified to the

FDA that it believed that its Oxycodone ER product candidate would not infringe any of the OxyContin® patents listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, commonly

known as the “Orange Book”, or that such patents are invalid, and so notified Purdue and the other owners of the subject patents listed in the Orange Book of such certification.

On April 7, 2017, the Company received notice that Purdue Pharma L.P., Purdue Pharmaceuticals L.P., The P.F. Laboratories, Inc., or collectively the Purdue parties, Rhodes Technologies, and Grünenthal GmbH, or collectively the Purdue litigation plaintiffs, had commenced patent infringement proceedings against the Company in the U.S. District Court for the District of Delaware (docket number 17-392) in respect of its NDA filing for Oxycodone ER, alleging that its proposed Oxycodone ER infringes six out of the 16 patents associated with the branded product OxyContin^®, or the OxyContin^® patents, listed in the Orange Book.

Subsequent to the above-noted filing of lawsuit, four further such patents were listed and published in the Orange Book. On March 16, 2018, the Company received notice that the Purdue litigation plaintiffs had commenced further such patent infringement proceedings adding the four further patents. On April 15, 2020, Purdue filed a new patent infringement suit against the Company relating to additional Paragraph IV certifications lodged against two more listed Purdue patents.

As a result of the commencement of the first of these legal proceedings, the FDA was stayed for 30 months from granting final approval to the Company’s Oxycodone ER product candidate. That time period commenced on February 24, 2017, when the Purdue litigation plaintiffs received notice of the Company’s certification concerning the patents, and were to expire on August 24, 2019, unless the stay was earlier terminated by a final declaration of the courts that the patents are invalid, or are not infringed, or the matter is otherwise settled among the parties. On April 24, 2019, an order was issued, setting a trial date of

Page 18

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

12. Contingencies (continued)

November 12, 2019 for case number 17-392 in the District of Delaware, and also extending the 30-month stay date for regulatory approval to March 2, 2020.

On or about June 26, 2018, the court issued an order to sever 6 “overlapping” patents from the second Purdue case but ordered litigation to proceed on the 4 new (2017-issued) patents. An answer and counterclaim was filed on July 9, 2018. On July 6, 2018, the court issued a so-called “Markman” claim construction ruling on the first case. On July 24, 2018, the parties to the case mutually agreed to and did

have dismissed without prejudice the infringement claims related to the Grünenthal ‘060 patent, which is one of the six patents included in the original litigation case.

On October 4, 2018, the parties mutually agreed to postpone the scheduled court date pending a case status conference scheduled for December 17, 2018. At that time, further trial scheduling and other administrative matters were postponed pending the Company’s resubmission of the Oxycodone ER NDA to the FDA, which was made on February 28, 2019. On January 17, 2019, the court issued a scheduling order in which the remaining major portions are scheduled. The trial was scheduled for June 2020.

On April 4, 2019, the U.S. Federal Circuit Court of Appeals affirmed the invalidity of one Purdue OxyContin® formulation patent, subject to further appeal to the U.S. Supreme Court.

Following the filing of a bankruptcy stay by Purdue Pharma L.P., the Company’s ongoing litigation case numbers 1:17-cv-00392-RGA and 1:18-cv-00404-RGA-SRF between Purdue Pharma L.P. et al and The Company were stayed and the existing trial dates in both cases vacated by orders issued in each case by the judge in the District of Delaware on October 3, 2019. With the litigation stay order, the previous 30-month stay date of March 2, 2020 was unchanged.

On or about July 2, 2020 the parties in the cases, numbers 17-cv-392-RGA, 18-cv-404-RGA and 20-cv-515-RGA (the “Litigations”) between Purdue Pharma L.P. et al (“Purdue’) and Intellipharmaceutics entered into a stipulated dismissal of the Litigations. The stipulated dismissal, which was subject to approval by the bankruptcy court presiding over Purdue Pharma’s pending chapter 11 cases, provides for the termination of the patent infringement proceedings. The stipulated dismissal also provides that (i) for a thirty (30) day period following a final approval of the Company’s Aximris XRTM NDA the parties will attempt to resolve any potential asserted patent infringement claims relatingto the NDA and (ii) if the parties fail to resolve all such claims during such periodPurdue Pharma will have fifteen (15) days to pursue an

infringement action against the Company.The terms of the stipulated dismissal agreement are confidential.

On July 28, 2020 theU.S.District Court for the District of Delaware signed the stipulations of dismissal into order thereby dismissing the claims in the three cases without prejudice.In consideration of the confidential stipulated dismissal agreement andfor future saved litigation expenses, Purduepaidan amount to the Company.

In July 2017, three complaints were filed in the U.S. District Court for the Southern District of New York that were later consolidated under the caption Shanawaz v. Intellipharmaceutics Int’l Inc., et al., No. 1:17-cv-05761 (S.D.N.Y.). The lead plaintiffs filed a consolidated amended complaint on January 29, 2018. In the amended complaint, the lead plaintiffs assert claims on behalf of a putative class consisting of purchasers of the Company’s securities between May 21, 2015 and July 26, 2017. The amended complaint alleges that the defendants violated Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder by making allegedly false and misleading statements or failing to disclose certain information regarding the Company’s NDA for Oxycodone ER abuse-deterrent oxycodone hydrochloride extended release tablets. The complaint seeks, among other remedies, unspecified damages, attorneys’ fees and other costs, equitable and/or injunctive relief, and such other relief as the court may find just and proper.

On November 7, 2019, the Company announced that the parties reached a settlement that is subject to the approval of the court following notice to class members. The stipulation of settlement provides for a settlement payment of US$1.6 million by the Company, which has been paid from available insurance coverage.

Page 19

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

12. Contingencies (continued)

As part of the settlement, the Company also agreed to contribute to the settlement fund specific anticipated Canadian tax refunds of up to US$400,000 to the extent received within 18 months after the entry of final judgment. The stipulation of settlement acknowledges that the Company and the other defendants continue to deny that they committed any violation of the U.S. securities laws or engaged in any other wrongdoing and that they are entering into the settlement at this time based on the burden, expense, and inherent uncertainty of continuing the litigation. On December 7, 2020 the court approved the settlement and entered an order and final judgement to that effect, thereby concluding the case.

On February 21, 2019, the Company and its CEO, Dr. Isa Odidi (“Defendants”), were served with a Statement of Claim filed in the Superior Court of Justice of Ontario (“Court”) for a proposed class action under the Ontario Class Proceedings Act (“Action”). The Action was brought by Victor Romita, the proposed representative plaintiff (“Plaintiff”), on behalf of a class of Canadian persons (“Class”) who traded shares of the Company during the period from February 29, 2016 to July 26, 2017 (“Period”). The Statement of Claim, under the caption Victor Romita v. Intellipharmaceutics International Inc. and Isa Odidi, asserted that the defendants knowingly or negligently made certain public statements during the relevant period that contained or omitted material facts concerning Oxycodone ER abuse-deterrent oxycodone hydrochloride extended-release tablets. The plaintiff alleges that he and the class suffered loss and damages as a result of their trading in the Company’s shares during the relevant period. The plaintiff seeks, among other remedies, unspecified damages, legal fees and court and other costs as the Court may permit. On February 26, 2019, the plaintiff delivered a Notice of Motion seeking the required approval from the Court, in accordance with procedure under the Ontario Securities Act, to allow the statutory claims under the Ontario Securities Act to proceed with respect to the claims based upon the acquisition or disposition of the Company’s shares on the TSX during the Period (“Motion”). On June 28, 2019, the Court endorsed a timetable for the exchange of material leading to the hearing of the Motion scheduled for January 27-28, 2020. On October 28, 2019, plaintiff’s counsel advised the court that the Plaintiff intended to amend his claim and could not proceed with the Leave Motion scheduled for January 27-28, 2020. As such, the Court released those dates. On January 28, 2020 the plaintiff served a Notice of Motion for leave to amend the Statement of Claim. On April 2, 2020 the plaintiff delivered an Amended Motion Record and Amended Notice of Motion seeking an order for leave to issue a fresh as Amended Statement of Claim including the addition of Christopher Pearce as a Plaintiff (“Amendment Motion”).

On May 1, 2020, the court granted the plaintiff’s Amendment Motion. An order for leave to proceed for settlement purposes was granted on 25 June 2021. At a hearing on October 12,2021, the Court approved the settlement. The stipulation of settlement provides for a settlement payment of CAD$266,000 by the Company, CAD$226,000 was paid from insurance coverage while the Company paid CAD$40,000. Therefore, this action is now settled.

On October 7, 2019, a complaint was filed in the U.S. District Court for the Southern District of New York by Alpha Capital Anstalt (“Alpha”) against the Company, two of its existing officers and directors and its former Chief Financial Officer. In the complaint, Alpha alleged that the Company and the executive officers/directors named in the complaint violated Sections 11, 12(a)(2) and 15 of the U.S. Securities Act of 1933, as amended, by allegedly making false and misleading statements in the Company’s Registration Statement on Form F-1 filed with the U.S. Securities and Exchange Commission on September 20, 2018, as amended (the “Registration Statement”) by failing to disclose certain information regarding the resignation of the Company’s then Chief Financial Officer, which was announced several weeks after such registration statement was declared effective. In the complaint, Alpha seeks unspecified damages, rescission of its purchase of the Company’s securities in the relevant offering, attorneys’ fees and other costs and further relief as the court may find just and proper. On December 12, 2019, the Company and the other defendants in the action filed a motion to dismiss for failure to state a claim. The plaintiff filed an opposition to that motion on February 4, 2020 and a reply brief in further support of the motion to dismiss the action was filed March 6, 2020. In addition, the Court scheduled a mandatory settlement conference with the Magistrate Judge for April 23, 2020 which the Company and its counsel attended. On June 18, 2020, the court largely denied the Company’s motion to dismiss the action. Briefing on these motions was completed on February 19, 2021. In a court order filed July 9, 2021, the District Court issued an opinion and order granting summary judgment in the Company’s favor and ordered the case closed. The judgment was entered on July 12, 2021. On August 10, 2021, the Plaintiff filed a notice of appeal. On October 1, 2021, the Plaintiff filed a notice of voluntary dismissal of the appeal with prejudice, stipulated to by the Company. The Court of Appeals “so ordered” the voluntary dismissal stipulation and the appeal was

Page 20

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

12. Contingencies (continued)

dismissed. As a result, the matter has been fully resolved in favor of the Company and the named individual Defendants.

On or about August 5, 2020 a former employee filed a claim against the Company for wrongful dismissal of employment plus loss of benefits, unpaid vacation pay, interest and costs. The parties have agreed to settlement terms in the matter. The Company has fulfilled the terms and has received a release and consent to dismiss. A dismissal order is pending from the court.

On or about August 9, 2022, a service provider brought to the Company’s attention a Motion Record to seek judgement with respect to amounts owed it by the Company for the principal amount owed, plus pre-judgment interest and costs. We found out then, that a statement of claim dated May 3, 2021 was delivered to the Company’s premises. The Company did not respond to the claim because it was inadvertently never brought to the attention of management, as a result the Company was noted in default in May 31, 2021. The Company was not aware of claim and the default before August 9, 2022. The Company has signed a consent which allows the other party to obtain judgement from a court and take steps to enforce judgement if we default on certain conditions.

13. Financial instruments

(a) Fair values

The Company follows ASC Topic 820 Fair Value Measurement (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The provisions of ASC Topic 820 apply to other accounting pronouncements that require or permit fair value measurements. ASC Topic 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date; and establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date.

Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. To increase consistency and comparability in fair value measurements and related disclosures, the fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels.

The three levels of the hierarchy are defined as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly for substantially the full term of the financial instrument.

Level 3 inputs are unobservable inputs for asset or liabilities.

The categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

(i) The Company calculates fair value of the options and warrants using its own historical volatility (Level 1).

(ii) The Company calculates the interest rate for the conversion option based on the Company’s estimated cost of raising capital (Level 2).

An increase/decrease in the volatility and/or a decrease/increase in the discount rate would have resulted in an increase/decrease in the fair value of the conversion option and warrants.

Page 21

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

13. Financial instruments (continued)

(a) Fair values (continued)

Fair value of financial assets and financial liabilities that are not measured at fair value on a recurring basis are as follows:

	May 31, 2023				November 30, 2022
	Carrying		Fair		Carrying		Fair
	amount		value		amount		value
	$		$		$		$
Financial Liabilities
Convertible debentures(i)		1,800,000		1,783,882		1,800,000		1,753,406
Promissory notes payable(i)		359,454		359,454		360,514		360,514

(i) The Company calculates the interest rate for the Debentures and promissory notes payable based on the Company’s estimated cost of raising capital and uses the discounted cash flow model to calculate the fair value of the Debentures and the promissory notes payable.

The carrying values of cash, accounts receivable, accounts payable, accrued liabilities and employee cost payable approximates their fair values because of the short-term nature of these instruments.

(b) Interest rate and credit risk

Interest rate risk is the risk that the value of a financial instrument might be adversely affected by a change in interest rates. The Company does not believe that the results of operations or cash flows would be affected to any significant degree by a sudden change in market interest rates, relative to interest rates on cash and the convertible debenture due to the short-term nature of these obligations. Trade accounts receivable potentially subjects the Company to credit risk. The Company provides an allowance for doubtful accounts equal to the estimated losses expected to be incurred in the collection of accounts receivable.

The following table sets forth details of the aged accounts receivable that are not overdue as well as an analysis of overdue amounts and the related allowance for doubtful accounts:

	May 31,		November 30,
	2023		2022
	$		$
Accounts receivable		333,582		602
Less allowance for doubtful accounts		-		-
Total trade and other receivables, net		333,582		602
Not past due		333,582		602
Past due for more than 31 days
but no more than 120 days		-		-
Past due for more than 120 days		-		-
Total trade and other receivables, gross		333,582		602

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of uncollateralized accounts receivable. The Company’s maximum exposure to credit risk is equal to the potential amount of financial assets. For the three months ended May 31, 2023, one customer accounted for all the revenues and all the accounts receivable of the Company.

The Company is also exposed to credit risk at period end from the carrying value of its cash. The Company manages this risk by maintaining bank accounts with a Canadian Chartered Bank. The Company’s cash is not subject to any external restrictions.

Page 22

Intellipharmaceutics International Inc.

Notes to the condensed unaudited interim consolidated financial statements

For the three and six months ended May 31, 2023 and 2022

(Stated in U.S. dollars)

13. Financial instruments (continued)

(c) Foreign exchange risk

The Company has balances in Canadian dollars that give rise to exposure to foreign exchange risk relating to the impact of translating certain non-U.S. dollar balance sheet accounts as these statements are presented in U.S. dollars. A strengthening U.S. dollar will lead to a foreign exchange loss while a weakening U.S. dollar will lead to a foreign exchange gain. For each Canadian dollar balance of $1.0 million, a +/- 10% movement in the Canadian currency held by the Company versus the U.S. dollar would affect the Company’s loss and other comprehensive loss by $0.1 million.

(d) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty raising liquid funds to meet its commitments as they fall due. In meeting its liquidity requirements, the Company closely monitors its forecasted cash requirements with expected cash drawdown.

The following are the contractual maturities of the undiscounted cash flows of financial liabilities as at May 31, 2023:

	Less than		3 to 6		6 to 9		9 months		Greater than
	3 months		months		months		to 1 year		1 year		Total
	$		$		$		$		$		$
Accounts payable		3,672,776		-		-		-		-		3,672,776
Accrued liabilities		3,284,320		-		-		-		-		3,284,320
Employee costs payable		3,491,952		-		-		-		-		3,491,952
Operating lease liabiity		45,891		45,891		-		-		-		91,782
Convertible debentures (Note 5)		1,800,000		-		-		-		-		1,800,000
Promissory notes payable (Note 5)		359,454		-		-		-		-		359,454
Total contractual obligations		12,654,393		45,891		-		-		-		12,700,284

14. Segmented information

The Company's operations comprise a single reportable segment engaged in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. As the operations comprise a single reportable segment, amounts disclosed in the financial statements for revenue, loss for the period, depreciation and total assets also represent segmented amounts. In addition, all of the Company's long-lived assets are in Canada. The Company’s license and commercialization agreement with Par accounts for substantially all of the revenue of the Company.

14. Segmented information (continued)

	Three months ended				Six months ended
	May 31,		May 31,		May 31,		May 31,
	2023		2022		2023		2022
	$		$		$		$
Revenue
United States		806,546		-		16,978		16,978

	May 31,		November 30,
	2023		2022
	$		$
Total assets
Canada		1,735,410		1,432,032
Total property and equipment
Canada		706,760		788,050

23

EX-99.3

EXHIBIT 99.3

Intellipharmaceutics Announces Second Quarter 2023 Results

Toronto, Ontario July 14, 2023 – Intellipharmaceutics International Inc. (OTCQB: IPCIF and TSX: IPCI) (“Intellipharmaceutics” or the “Company”), a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs, today reported the results of operations for the three and six months ended May 31, 2023. All dollar amounts referenced herein are in United States dollars unless otherwise noted.

·	On June 5, 2023 the Company filed it’s annual audited financial statements for the year ended November 30, 2022 as well as the interim (Q1 2023) financial statements, MD&A and the required certifications. The Ontario Securities Commission (the “OSC”) was satisfied that the Company had filed the continuous disclosure documents required within the time specified in the failure to file cease trade order (CTO), then in effect, and revoked the CTO June 7, 2023.
·	On March 7, 2023 the Company had announced that the “OSC” had issued a general "failure to file" cease trade order (CTO) pursuant to National Policy 11-103 – Failure to File Cease Trade Orders in Multiple Jurisdictions dated March 6, 2023 in respect of the securities of the Company as a result of the Company’s inability to file its annual audited financial statements and other required filings for the fiscal year ended November 30, 2022 by the filing deadline of February 28, 2023.
	The CTO prohibited the trading, whether direct or indirect, by any person of any securities of the Company in each jurisdiction in Canada in which the Company is a reporting issuer for as long as the CTO remains in effect; however, the CTO provides an exception for beneficial security holders of the Company who are not (and who were not as of March 6, 2023) insiders or control persons of the Company and who sell securities of the Company acquired before March 6, 2023 if both of the following criteria are met: (i) the sale is made through a "foreign organized regulated market", as defined in section 1.1 of the Universal Market Integrity Rules of the Investment Industry Regulatory Organization of Canada and (ii) the sale is made through an investment dealer registered in a jurisdiction of Canada in accordance with applicable securities legislation. If the default is remedied within 90 days of the date of the CTO (March 6, 2023), including any annual or interim financial statements, MD&A and certifications that subsequently became due, the filing of the documents constitutes the application to revoke the CTO and no application fee would be required.
·	On February 3, 2023 the Company had announced that its annual audited financial statements for the fiscal year ended November 30, 2022, related management’s discussion and analysis and accompanying Chief Executive Officer and Chief Financial Officer certificates and annual information form for the fiscal year ended November 30, 2022 due February 28, 2023 will not be filed by the filing deadline.
·	In August 2022 the Company announced that it has entered into a license and supply agreement with Taro Pharmaceuticals Inc. ("Taro"), by which the Company has granted Taro an exclusive license to market, sell and distribute in Canada, Desvenlafaxine Extended-release Tablets in the 50 mg and 100 mg strengths (the "licensed product") approved for sale in the Canadian market by the Pharmaceutical Drugs Directory (PDD) of Health Canada.
·	In February 2022 the Company received marketing approval for the Canadian market from Health Canada (notice of compliance) for generic Pristiq (desvenlafaxine succinate extended-release tablets) in the 50 and 100 mg strengths.

1

Results of Operations

The Company recorded net loss for the three months ended May 31, 2023 of $54,121 or $0.002 per common share, compared with a net loss of $840,654 or $0.03 per common share for the three months ended May 31, 2022. For the three months ended May 31, 2023, the net loss is attributed to expenditures related to ongoing selling, general and administrative expenses related to professional and legal fees, as well as ongoing R&D expenses, offset by an increase in licensing revenue. In the three months ended May 31, 2022, the net loss was attributed to the gain on sale of equipment offset by increased administrative expense related to professional and legal fees as well as R&D expenses.

The Company recorded revenues of $480,203 for the three months ended May 31, 2023 versus $Nil for the three months ended May 31, 2022. Such revenues consisted primarily of licensing revenues from commercial sales of our generic Focalin XR® under the Par agreement during the three months ended May 31, 2023.

Expenditures for R&D were $377,507 for the year ended May 31, 2023 in comparison to $956,851 the three months ended May 31, 2022. The decrease in the R&D expenses are attributed to the decrease in R&D staff in the first quarter of 2023, as well, in the second quarter of 2022 allocation of losses on royalty payments were included in R&D cost.

Selling, general and administrative expenses were $93,504 for the three months ended May 31, 2023 in comparison to $243,501 for the three months ended May 31, 2022, resulting in a decrease of $122,023. The decrease is due to a decrease in administrative costs, wages, and occupancy cost.

As of May 31, 2023, our cash balance was $159,274. We currently expect to meet our short-term cash requirements from potential revenues for approved generic products or other collaborations, other available financing and by cost savings resulting from reduced R&D activities and staffing levels, as well as quarterly profit share from Par. Effective May 5, 2021 our exclusive license agreements with Tris Pharma, Inc. for generic Seroquel XR^®, generic Pristiq^® and generic Effexor XR^® were mutually terminated. Products were never supplied nor distributed under the licenses. Termination of the exclusive agreements may provide opportunity for the Company to explore options of supplying the products to multiple sources on non-exclusive bases. However, there can be no assurance that the products previously licensed to Tris Pharma will be successfully commercialized and produce significant revenues for us. We will need to obtain additional funding to, among other things, further product commercialization activities and development of our product candidates. The Company recently entered into a license and supply agreement with Taro Pharmaceuticals Inc. by which the Company has granted Taro an exclusive license to market, sell and distribute a product in Canada. There can be no assurance that the product will be successfully commercialized and produce significant revenues for us. Potential sources of capital may include, if conditions permit, equity and/or debt financing, payments from licensing and/or development agreements and/or new strategic partnership agreements. The Company has funded its business activities principally through the issuance of securities, loans from related parties (see “Related Party Transactions” for more information related to the terms of such loans and applicable maturities) and funds from development agreements. There is no certainty that such funding will be available going forward or, if it is, whether it will be sufficient to meet our needs. Our future operations are highly dependent upon our ability to source additional funding to support advancing our product candidate pipeline through continued R&D activities and to expand our operations. Our ultimate success will depend on whether our product candidates are approved by the FDA, Health Canada, or the regulatory authorities of other countries in which our products are proposed to be sold and whether we are able to successfully market our approved products. We cannot be certain that we will receive such regulatory approval for any of our current or future product candidates, that we will reach the level of revenues necessary to achieve and sustain profitability, or that we will secure other capital sources on terms or in amounts sufficient to meet our needs, or at all.

There can be no assurance that we will not be required to conduct further studies for our Aximris XR^TM product candidate, that the FDA will approve any of our requested abuse-deterrence label claims, that the FDA will meet its deadline for review, or that the FDA will ultimately approve the NDA for the sale of the product candidate in the U.S. market, or that the product will ever be successfully commercialized and produce significant revenue for us.If the Aximris XR^TM NDA is approved, there can be no assurance that the Company and Purdue will resolve any potential asserted patent infringement claims relating to the NDA within a thirty (30) day period following the final approval as provided in the stipulated dismissal agreement of the Purdue litigations. There can be no assurance that the Purdue parties will not pursue an infringement claim against the Company again. There can be no assurance that any of our products or product candidates can be successfully commercialized and produce significant revenues for the company.

2

About Intellipharmaceutics

Intellipharmaceutics International Inc. is a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. The Company's patented Hypermatrix™ technology is a multidimensional controlled-release drug delivery platform that can be applied to a wide range of existing and new pharmaceuticals. Intellipharmaceutics has developed several drug delivery systems based on this technology platform, with a pipeline of products (some of which have received FDA approval) in various stages of development. The Company has ANDA and NDA 505(b)(2) drug product candidates in its development pipeline. These include the Company’s Oxycodone ER based on its proprietary nPODDDS™ novel Point Of Divergence Drug Delivery System (for which an NDA has been filed with the FDA), and Regabatin™ XR (pregabalin extended-release capsules).

Cautionary Statement Regarding Forward-Looking Information

Certain statements in this document constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and/or “forward-looking information” under the Securities Act (Ontario). These statements include, without limitation, statements expressed or implied regarding our expectations , plans, goals and milestones, status of developments or expenditures relating to our business, plans to fund our current activities, and statements concerning our partnering activities, health regulatory submissions, strategy, future operations, future financial position, future sales, revenues and profitability, projected costs and market penetration and risks or uncertainties arising from the delisting of our shares from Nasdaq and our ability to comply with OTCQB and TSX requirements. In some cases, you can identify forward-looking statements by terminology such as “appear”, “unlikely”, “target”, "may", "will", "should", "expects", "plans", "plans to", "anticipates", "believes", "estimates", "predicts", "confident", "prospects", "potential", "continue", "intends", "look forward", "could", “would”, “projected”, “goals” ,“set to”, “seeking” or the negative of such terms or other comparable terminology. We made a number of assumptions in the preparation of our forward-looking statements. You should not place undue reliance on our forward-looking statements, which are subject to a multitude of known and unknown risks and uncertainties that could cause actual results, future circumstances or events to differ materially from those stated in or implied by the forward-looking statements. Risks, uncertainties and other factors that could affect our actual results include, but are not limited to, , the effects of general economic conditions, securing and maintaining corporate alliances, our estimates regarding our capital requirements, and the effect of capital market conditions and other factors, including the current status of our product development programs, capital availability, the estimated proceeds (and the expected use of any proceeds) we may receive from any offering of our securities, the potential dilutive effects of any future financing, potential liability from and costs of defending pending or future litigation, risks associated with the novel coronavirus (COVID-19) including its impact on our business and operations, our programs regarding research, development and commercialization of our product candidates, the timing of such programs, the timing, costs and uncertainties regarding obtaining regulatory approvals to market our product candidates and the difficulty in predicting the timing and results of any product launches, the timing and amount of profit-share payments from our commercial partners, and the timing and amount of any available investment tax credits, the actual or perceived benefits to users of our drug delivery technologies, products and product candidates as compared to others, our ability to establish and maintain valid and enforceable intellectual property rights in our drug delivery technologies, products and product candidates, the scope of protection provided by intellectual property rights for our drug delivery technologies, products and product candidates, recent and future legal developments in the United States and elsewhere that could make it more difficult and costly for us to obtain regulatory approvals for our product candidates and negatively affect the prices we may charge, increased public awareness and government scrutiny of the problems associated with the potential for abuse of opioid based medications, pursuing growth through international operations could strain our resources, our limited manufacturing, sales, marketing and distribution capability and our reliance on third parties for such, the actual size of the potential markets for any of our products and product candidates compared to our market estimates, our selection and licensing of products and product candidates, our ability to attract distributors and/or commercial partners with the ability to fund patent litigation and with acceptable product development, regulatory and commercialization expertise and the benefits to be derived from such collaborative efforts, sources of revenues and anticipated revenues, including contributions from distributors and commercial partners, product sales, license agreements and other collaborative efforts for the development and commercialization of product candidates, our ability to create an effective direct sales and marketing infrastructure for products we elect to market and sell directly, the rate and degree of market acceptance of our products, delays in product approvals that may be caused by changing regulatory requirements, the difficulty in predicting the timing of regulatory approval and launch of competitive products, the difficulty in predicting the impact of competitive products on sales volume, pricing, rebates and other allowances, the number of competitive product entries, and the nature and extent of any aggressive pricing and rebate activities that may follow, the inability to forecast wholesaler demand and/or wholesaler buying patterns, seasonal fluctuations in the number of prescriptions written for our generic Focalin XR® capsules which may produce substantial fluctuations in revenue, the timing and amount of insurance reimbursement regarding our products, changes in laws and regulations affecting the conditions required by the FDA for approval, testing and labeling of drugs including abuse or overdose deterrent properties, and changes affecting how opioids are regulated and prescribed by physicians, changes in laws and regulations, including Medicare and Medicaid, affecting among other things, pricing and reimbursement of pharmaceutical products, the effect of recent changes in U.S. federal income tax laws, including but not limited to, limitations on the deductibility of business interest, limitations on the use of net operating losses and application of the base erosion minimum tax, on our U.S. corporate income tax burden, the success and pricing of other competing therapies that may become available, our ability to retain and hire qualified employees, the availability and pricing of third-party sourced products and materials, challenges related to the development, commercialization, technology transfer, scale-up, and/or process validation of manufacturing processes for our products or product candidates, the manufacturing capacity of third-party manufacturers that we may use for our products, potential product liability risks, the recoverability of the cost of any pre-launch inventory, should a planned product launch encounter a denial or delay of approval by regulatory bodies, a delay in commercialization, or other potential issues, the successful compliance with FDA, Health Canada and other governmental regulations applicable to us and our third party manufacturers' facilities, products and/or businesses, our reliance on commercial partners, and any future commercial partners, to market and commercialize our products and, if approved, our product candidates, difficulties, delays or changes in the FDA approval process or test criteria for ANDAs and NDAs, challenges in securing final FDA approval for our product candidates, including our oxycodone hydrochloride extended release tablets product candidate, in particular, if a patent infringement suit is filed against us with respect to any particular product candidates (such as in the case of Oxycodone ER), which could delay the FDA's final approval of such product candidates, healthcare reform measures that could hinder or prevent the commercial success of our products and product candidates, the risk that the FDA may not approve requested product labeling for our product candidate(s) having abuse-deterrent properties and targeting common forms of abuse (oral, intra-nasal and intravenous), risks associated with cyber-security and the potential for vulnerability of our digital information or the digital information of a current and/or future drug development or commercialization partner of ours, and risks arising from the ability and willingness of our third-party commercialization partners to provide documentation that may be required to support information on revenues earned by us from those commercialization partners. Additional risks and uncertainties relating to us and our business can be found in the "Risk Factors" section of our latest annual information form, our latest Form 20-F, and our latest Form F-1 and F-3 registration statements (including any documents forming a part thereof or incorporated by reference therein), as amended, as well as in our reports, public disclosure documents and other filings with the securities commissions and other regulatory bodies in Canada and the U.S., which are available on www.sedar.com and www.sec.gov. The forward-looking statements reflect our current views with respect to future events and are based on what we believe are reasonable assumptions as of the date of this document and we disclaim any intention and have no obligation or responsibility, except as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

3

Trademarks used herein are the property of their respective holders.

Unless the context otherwise requires, all references (i) to "we," "us," "our," "Intellipharmaceutics," and the "Company" refer to Intellipharmaceutics International Inc. and its subsidiaries and (ii) in this document to share amounts, per share data, share prices, exercise prices and conversion rates have been adjusted to reflect the effect of the 1-for-10 reverse split which became effective on each of Nasdaq and TSX at the open of market on September 14, 2018. The common shares of the Company are currently traded on the OTCQB and the TSX.

Nothing contained in this document should be construed to imply that the results discussed herein will necessarily continue into the future or that any conclusion reached herein will necessarily be indicative of our actual operating results.

The consolidated financial statements, accompanying notes to the consolidated financial statements, and Management Discussion and Analysis for the three and six months ended May 31, 2023 will be accessible on Intellipharmaceutics’ website at www.intellipharmaceutics.com and will be available on SEDAR.

Summary financial tables are provided below.

4

Intellipharmaceutics International Inc.
Consolidated balance sheets
As at
(Stated in U.S. dollars)
	May 31,			November 30,
	2023			2022
Assets
Current
Cash		159,274			83,722
Trade and other receivables, net		333,582			602
Investment tax credits		268,179			268,179
Prepaid expenses and other assets		192,411			140,008
		953,446			492,511
Property and equipment, net		706,760			788,050
Right-of-use asset		75,204			151,471
		1,735,410			1,432,032
Liabilities
Current
Accounts payable		3,672,776			3,764,692
Accrued liabilities		3,284,320			2,821,506
Employee costs payable		3,491,952			3,067,578
Operating lease liability		84,466			165,441
Income tax payable		29,036			29,036
Promissory notes payable		359,454			360,514
Convertible debentures		1,800,000			1,800,000
		12,722,004			12,008,767
Shareholders' deficiency
Capital stock
Authorized
Unlimited common shares without par value
Unlimited preference shares
Issued and outstanding
33,092,665 common shares		49,175,630			49,175,630
(November 30, 2020 - 23,678,105)
Additional paid-in capital		45,097,313			45,097,313
Accumulated other comprehensive income		284,421			284,421
Accumulated deficit		(105,543,958	)		(105,134,099	)
		(10,986,594	)		(10,576,735	)
		1,735,410			1,432,032

5

Intellipharmaceutics International Inc.
Condensed unaudited interim consolidated statements of operations and comprehensive loss
For the three and six months ended May 31, 2023 and 2022
(Stated in U.S. dollars)
	Three months ended						Six months ended
	May 31, 2023			May 31, 2022			May 31, 2023			May 31, 2022
Revenue
Licensing		480,203			-			806,546			-
Other revenue		-			-			-			16,978
		480,203			-			806,546			16,978
Expenses
Research and development		377,507			956,851			825,673			1,434,408
Selling, general and administrative		93,504			243,501			232,339			504,359
Depreciation		40,547			51,479			81,289			102,957
		511,558			1,251,831			1,139,301			2,041,724
Loss from operations		(31,355	)		(1,251,831	)		(332,755	)		(2,024,746	)
Net foreign exchange gain		29,122			(15,357	)		25,544			(22,851	)
Interest expense		(51,888	)		(73,466	)		(102,648	)		(174,029	)
Gain on disposal of assets		-			500,000			-			500,000
Net loss and comprehensive loss		(54,121	)		(840,654	)		(409,859	)		(1,721,626	)
Loss per common share, basic and diluted		(0.002	)		(0.03	)		(0.01	)		(0.05	)
Weighted average number of common
shares outstanding, basic and diluted		33,092,665			33,092,665			33,092,665			33,092,665

6

Intellipharmaceutics International Inc.
Condensed unaudited interim consolidated statements of cash flows
For the three and six months ended May 31, 2023 and 2022
(Stated in U.S. dollars)
	Three months ended						Six months ended
	May 31, 2023			May 31, 2022			May 31, 2023			May 31, 2022
Net loss		(54,121	)		(840,654	)		(409,859	)		(1,721,626	)
Items not affecting cash
Depreciation		40,547			51,479			81,289			102,957
Accreted interest		-			20,834			-			69,351
Non-cash lease expense		(6,682	)		490			4,708			1,042
Gain on disposal of assets		-			(500,000	)		-			(500,000	)
Unrealized foreign exchange (gain) loss		(10,472	)		629			(10,477	)		1,812
Change in non-cash operating assets & liabilities
Accounts receivable		(122,055	)		37,353			(332,980	)		-
Prepaid expenses, sundry and other assets		(6,296	)		40,006			(52,403	)		(205,121	)
Accounts payable, accrued liabilities and employee costs payable		248,807			851,294			795,274			1,352,435
Cash flows provided from (used in) operating activities		89,728			(338,569	)		75,552			(899,150	)
Investing activities
Sale of property and equipment		-			500,000			-			500,000
		-			500,000			-			500,000
Increase (decrease) in cash		89,728			161,431			75,552			(399,150	)
Cash, beginning of period		69,546			211,364			83,722			771,945
Cash, end of period		159,274			372,795			159,274			372,795

7

CONTACT INFORMATION

Company Contact:

Intellipharmaceutics International Inc.

Isa Odidi

Chief Executive Officer

416.798.3001 ext. 102

investors@intellipharmaceutics.com

8

EX-99.4

EXHIBIT 99.4

FORM 52-109F2

CERTIFICATION OF INTERIM FILINGS

FULL CERTIFICATE

I, Dr. Isa Odidi, Chief Executive Officer, of Intellipharmaceutics International Inc., certify the following

1. Review: I have reviewed the interim financial statements and interim MD&A (together, the "interim filings") of Intellipharmaceutics International Inc. (the "issuer") for the interim period ended May 31, 2023.

2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4.Responsibility: The issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control Framework: The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Committee of Sponsoring Organizations Internal Control Framework.

5.2 ICFR – material weakness relating to design: The issuer has disclosed in its interim MD&A for each material weakness relating to design existing at the end of the interim period

(a) a description of the material weakness;

(b) the impact of the material weakness on the issuer’s financial reporting and its ICFR; and

(c) the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.

5.3 N/A

6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on March 1, 2023 and ended on May 31, 2023 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: July 14, 2023

/s/ Isa Odidi

Dr. Isa Odidi

Chief Executive Officer

EX-99.5

EXHIBIT 99.5

FORM 52-109F2

CERTIFICATION OF INTERIM FILINGS

FULL CERTIFICATE

I, Amina Odidi, President/COO, Acting Chief Financial Officer, of Intellipharmaceutics International Inc., certify the following

1. Review: I have reviewed the interim financial statements and interim MD&A (together, the "interim filings") of Intellipharmaceutics International Inc. (the "issuer") for the interim period ended May 31, 2023.

2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial condition, results of operations and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4.Responsibility: The issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control Framework: The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Committee of Sponsoring Organizations Internal Control Framework.

5.2 ICFR – material weakness relating to design: The issuer has disclosed in its interim MD&A for each material weakness relating to design existing at the end of the interim period

(a) a description of the material weakness;

(b) the impact of the material weakness on the issuer’s financial reporting and its ICFR; and

(c) the issuer’s current plans, if any, or any actions already undertaken, for remediating the material weakness.

5.3 N/A

6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on March 1, 2023 and ended on May 31, 2023, that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: July 15, 2023

/s/ Amina Odidi

Dr. Amina Odidi

Acting Chief Financial Officer

XML

Cover	6 Months Ended
	May 31, 2023
Cover [Abstract]
Entity Registrant Name	Intellipharmaceutics International Inc.
Entity Central Index Key	0001474835
Document Type	6-K
Amendment Flag	false
Current Fiscal Year End Date	--11-30
Document Period End Date	May 31, 2023
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2023
Entity File Number	000-53805

XML

Consolidated balance sheets - USD ($)	May 31, 2023	Nov. 30, 2022
Current
Cash	$ 159,274	$ 83,722
Trade and other receivables, net	333,582	602
Investment tax credits	268,179	268,179
Prepaid expenses and other assets	192,411	140,008
Total Current Assets	953,446	492,511
Property and equipment, net (Note 4)	706,760	788,050
Right-of-use asset (Note 6)	75,204	151,471
Total Assets	1,735,410	1,432,032
Current
Accounts payable	3,672,776	3,764,692
Accrued liabilities	3,284,320	2,821,506
Employee costs payable	3,491,952	3,067,578
Operating lease liability (Note 6)	84,466	165,441
Income tax payable	29,036	29,036
Promissory notes payable (Note 5)	359,454	360,514
Convertible debentures (Note 5)	1,800,000	1,800,000
Total Current Liabilities	12,722,004	12,008,767
Shareholders' deficiency
Capital stock (Note 7) Authorized Unlimited common shares without par value Unlimited preference shares Issued and outstanding 33,092,665 common shares (November 30, 2020 - 23,678,105)	49,175,630	49,175,630
Additional paid-in capital	45,097,313	45,097,313
Accumulated other comprehensive income	284,421	284,421
Accumulated deficit	(105,543,958)	(105,134,099)
Total Shareholders Deficiency	(10,986,594)	(10,576,735)
Contingencies (Note 12)
Total Liabilities And Stockholders Equity	$ 1,735,410	$ 1,432,032

XML

Consolidated balance sheets (Parenthetical) - shares	May 31, 2023	Nov. 30, 2022	May 31, 2022
Consolidated balance sheets
Common shares, issued	33,092,665	23,678,105	33,092,665
Common shares, outstanding	33,092,665	23,678,105	33,092,665

XML

Condensed unaudited interim consolidated statements of operations and comprehensive loss - USD ($)	3 Months Ended		6 Months Ended
	May 31, 2023	May 31, 2022	May 31, 2023	May 31, 2022
Revenue
Licensing (Note 3)	$ 480,203	$ 0	$ 806,546	$ 0
Other revenue	0	0	0	16,978
Total Revenue	480,203	0	806,546	16,978
Expenses
Research and development	377,507	956,851	825,673	1,434,408
Selling, general and administrative	93,504	243,501	232,339	504,359
Depreciation (Note 4)	40,547	51,479	81,289	102,957
Total operating expenses	511,558	1,251,831	1,139,301	2,041,724
Loss from operations	(31,355)	(1,251,831)	(332,755)	(2,024,746)
Net foreign exchange gain	29,122	(15,357)	25,544	(22,851)
Interest expense	(51,888)	(73,466)	(102,648)	(174,029)
Gain on disposal of assets	0	500,000	0	500,000
Net loss and comprehensive loss	$ (54,121)	$ (840,654)	$ (409,859)	$ (1,721,626)
Loss per common share, basic and diluted	$ (0.002)	$ (0.03)	$ (0.01)	$ (0.05)
Weighted average number of common shares outstanding, basic and diluted	33,092,665	33,092,665	33,092,665	33,092,665

XML

Condensed unaudited interim consolidated statements of shareholders' equity (deficiency) - USD ($)	Total	Additional Paid-In Capital	Accumulated other comprehensive income	Accumulated Deficit	Capital Stock
Balance, shares at Nov. 30, 2021					33,092,665
Balance, amount at Nov. 30, 2021	$ (8,155,218)	$ 44,626,436	$ 284,421	$ (102,241,705)	$ 49,175,630
Beneficial conversion feature related to Debentures (Note 5)	20,833	20,833	0	0	0
Net loss	(1,721,626)	0	0	(1,721,626)	0
Balance, amount at May. 31, 2022	(9,856,011)	44,647,269	284,421	(103,963,331)	$ 49,175,630
Balance, shares at May. 31, 2022					33,092,665
Balance, shares at Nov. 30, 2022					33,092,665
Balance, amount at Nov. 30, 2022	(10,576,735)	45,097,313	284,421	(105,134,099)	$ 49,175,630
Net loss	(409,859)	0	0	(409,859)	0
Balance, amount at May. 31, 2023	$ (10,986,594)	$ 45,097,313	$ 284,421	$ (105,543,958)	$ 49,175,630
Balance, shares at May. 31, 2023					33,092,665

XML

Condensed unaudited interim consolidated statements of cash flows - USD ($)	3 Months Ended		6 Months Ended
	May 31, 2023	May 31, 2022	May 31, 2023	May 31, 2022
Condensed unaudited interim consolidated statements of cash flows
Net loss	$ (54,121)	$ (840,654)	$ (409,859)	$ (1,721,626)
Items not affecting cash
Depreciation	40,547	51,479	81,289	102,957
Accreted interest	0	20,834	0	69,351
Non-cash lease expense	(6,682)	490	4,708	1,042
Gain on disposal of assets	0	(500,000)	0	(500,000)
Unrealized foreign exchange (gain) loss	(10,472)	629	(10,477)	1,812
Change in non-cash operating assets & liabilities
Accounts receivable	(122,055)	37,353	(332,980)	0
Prepaid expenses, sundry and other assets	(6,296)	40,006	(52,403)	(205,121)
Accounts payable, accrued liabilities and employee costs payable	248,807	851,294	795,274	1,352,435
Cash flows provided from (used in) operating activities	89,728	(338,569)	75,552	(899,150)
Investing activities
Sale of property and equipment	0	500,000	0	500,000
Cash flows provided from investing activities	0	500,000	0	500,000
Increase (decrease) in cash	89,728	161,431	75,552	(399,150)
Cash, beginning of period	69,546	211,364	83,722	771,945
Cash, end of period	$ 159,274	$ 372,795	$ 159,274	$ 372,795

XML

Nature of Operations

6 Months Ended

May 31, 2023

Nature of Operations

Nature of Operations

1. Nature of operations

Intellipharmaceutics International Inc. (the “Company”) is a pharmaceutical company specializing in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs.

On October 22, 2009, IntelliPharmaCeutics Ltd. (“IPC Ltd. “) and Vasogen Inc. completed a court approved plan of arrangement and merger (the “IPC Arrangement Agreement”), resulting in the formation of the Company, which is incorporated under the laws of Canada. The Company’s common shares are traded on the Toronto Stock Exchange (“TSX”) and the OTCQB Venture Market.

The Company earns revenue from non-refundable upfront fees, milestone payments upon achievement of specified research or development, exclusivity milestone payments and licensing and cost-plus payments on sales of resulting products. In November 2013, the U.S. Food and Drug Administration (“FDA”) granted the Company final approval to market the Company’s first product, the 15 mg and 30 mg strengths of the Company’s generic Focalin XR® (dexmethylphenidate hydrochloride extended-release) capsules. In 2017, the FDA granted final approval for the remaining 6 (six) strengths, all of which have been launched. In May 2017, the FDA granted the Company final approval for its second commercialized product, the 50, 150, 200, 300 and 400 mg strengths of generic Seroquel XR® (quetiapine fumarate extended release) tablets, and the Company commenced shipment of all strengths that same month. In November 2018, the FDA granted the Company final approval for its venlafaxine hydrochloride extended-release capsules in the 37.5, 75, and 150 mg strengths.

Going concern

The condensed unaudited interim consolidated financial statements are prepared on a going concern basis, which assumes that the Company will be able to meet its obligations and continue its operations for the next twelve months. The Company has incurred losses from operations since inception and has reported losses of $54,121 and $409,859 for the three and six months ended May 31, 2023 (three and six months ended May 31, 2022 - $840,654 and $1,721,626) and has an accumulated deficit of $105,543,958 as at May 31, 2023 (November 30, 2022 - $105,134,099). The Company has a working capital deficiency of $10,986,594 as atMay 31, 2023 (November 30, 2022 – $11,516,252). The Company has funded its research and development (“R&D”) activities principally through the issuance of securities, loans from related parties, funds from the IPC Arrangement Agreement, and funds received under development agreements. There is no certainty that such funding will be available going forward. These conditions raise substantial doubt about its ability to continue as a going concern and realize its assets and pay its liabilities as they become due.

In order for the Company to continue as a going concern and fund any significant expansion of its operation or R&D activities, the Company will require significant additional capital. Although there can be no assurances, such funding may come from revenues from the sales of the Company’s generic Focalin XR® (dexmethylphenidate hydrochloride extended-release) capsules, from revenues from the sales of the Company’s generic Seroquel XR® (quetiapine fumarate extended-release) tablets and from potential partnering opportunities. Other potential sources of capital may include payments from licensing agreements, cost savings associated with managing operating expense levels, other equity and/or debt financings, and/or new strategic partnership agreements which fund some or all costs of product development. The Company’s ultimate success will depend on whether its product candidates receive the approval of the FDA, Health Canada, and the regulatory authorities of the other countries in which its products are proposed to be sold and whether it is able to successfully market approved products. The Company cannot be certain that it will receive FDA, Health Canada, or such other regulatory approval for any of its current or future product candidates, or that it will reach the level of sales and revenues necessary to achieve and sustain profitability, or that the Company can secure other capital sources on terms or in amounts sufficient to meet its needs, or at all.

The availability of equity or debt financing will be affected by, among other things, the results of the Company’s R&D, its ability to obtain regulatory approvals, its success in commercializing approved products with its commercial partners and the market acceptance of its products, the state of the capital markets generally, the delisting from Nasdaq (as defined below), strategic alliance agreements, and other relevant commercial considerations.

Going concern (continued)

In addition, if the Company raises additional funds by issuing equity securities, its then existing security holders will likely experience dilution, and the incurring of indebtedness would result in increased debt service obligations and could require the Company to agree to operating and financial covenants that would restrict its operations. In the event that the Company does not obtain sufficient additional capital, it will raise substantial doubt about the Company’s ability to continue as a going concern, realize its assets and pay its liabilities as they become due. The Company’s cash outflows are expected to consist primarily of internal and external R&D, legal and consulting expenditures to advance its product pipeline and selling, general and administrative expenses to support its commercialization efforts. Depending upon the results of the Company’s R&D programs, the impact of the litigation against the Company and the availability of financial resources, the Company could decide to accelerate, terminate, or reduce certain projects, or commence new ones. Any failure on its part to successfully commercialize approved products or raise additional funds on terms favorable to the Company or at all, may require the Company to significantly change or curtail its current or planned operations in order to conserve cash until such time, if ever, that sufficient proceeds from operations are generated, and could result in the Company not taking advantage of business opportunities, in the termination or delay of clinical trials or the Company not taking any necessary actions required by the FDA or Health Canada for one or more of the Company’s product candidates, in curtailment of the Company’s product development programs designed to identify new product candidates, in the sale or assignment of rights to its technologies, products or product candidates, and/or its inability to file Abbreviated New Drug Applications (“ANDAs”), Abbreviated New Drug Submissions (“ANDSs”) or New Drug Applications (“NDAs”) at all or in time to competitively market its products or product candidates.

The condensed unaudited interim consolidated financial statements do not include any adjustments that might result from the outcome of uncertainties described above. If the going concern assumption no longer becomes appropriate for these condensed unaudited interim consolidated financial statements, then adjustments would be necessary to the carrying values of assets and liabilities, the reported expenses and the balance sheet classifications used. Such adjustments could be material.

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Basis of Presentation

6 Months Ended

May 31, 2023

Basis of Presentation

Basis of Presentation

2. Basis of presentation

(a) Basis of consolidation

These condensed unaudited interim consolidated financial statements include the accounts of the Company and its wholly owned operating subsidiaries, IPC Ltd., Intellipharmaceutics Corp., and Vasogen Corp.

References in these condensed unaudited interim consolidated financial statements to share amounts, per share data, share prices, exercise prices and conversion rates have been adjusted to reflect the effect of the 1-for-10 reverse stock split (known as a share consolidation under Canadian law) (the “reverse split”) which became effective on each of The Nasdaq Stock Market LLC (“Nasdaq”) and TSX at the opening of the market on September 14, 2018. The term “share consolidation” is intended to refer to such reverse split and the terms “pre-consolidation” and “post-consolidation” are intended to refer to “pre-reverse split” and “post-reverse split”, respectively.

In September 2018, the Company announced the reverse split. At a special meeting of the Company’s shareholders held on August 15, 2018, the Company’s shareholders granted the Company’s Board of Directors discretionary authority to implement a share consolidation of the issued and outstanding common shares of the Company on the basis of a share consolidation ratio within a range from five (5) pre-consolidation common shares for one (1) post-consolidation common share to fifteen (15) pre-consolidation common shares for one (1) post-consolidation common share. The Board of Directors selected a share consolidation ratio of ten (10) pre-consolidation shares for one (1) post-consolidation common share. On September 12, 2018, the Company filed an amendment to the Company’s articles ("Articles of Amendment") to implement the 1-for-10 reverse split.

The Company’s common shares began trading on each of Nasdaq and TSX on a post-split basis under the Company’s existing trade symbol “IPCI” at the opening of the market on September 14, 2018. In accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”), the change was applied retroactively.

The condensed unaudited interim consolidated financial statements do not conform in all respects to the annual requirements of U.S. GAAP. Accordingly, these condensed unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto for the year ended November 30, 2022.

These condensed unaudited interim consolidated financial statements have been prepared using the same accounting policies and methods as those used by the Company in the annual audited consolidated financial statements for the year ended November 30, 2022.

The condensed unaudited interim consolidated financial statements reflect all adjustments necessary for the fair presentation of the Company’s financial position and results of operation for the interim periods presented. All such adjustments are normal and recurring in nature.

All inter-company accounts and transactions have been eliminated on consolidation.

(b) Use of estimates

The preparation of the condensed unaudited interim consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from those estimates.

Areas where significant judgment is involved in making estimates are the determination of the functional currency; the fair values of financial assets and liabilities, valuation of convertible debt; the determination of units of accounting for revenue recognition; the accrual of licensing and milestone revenue; and forecasting future cash flows for assessing the going concern assumption.

From late 2019 the Company has had to reduce development activities and staffing levels significantly due to ongoing financial problems which have continued, coupled with the effects of the Covid-19 pandemic. It is not possible to reliably estimate the length and severity of the developments and impact on the future financial results and condition of the Company. The challenges and uncertainties could impair the Company’s ability to raise capital,postpone research activities, impact our ability to maintain operations and launch new products; it could also impair the value of our shares, our long-lived assets, and materially adversely impact our ability to generate potential future revenue.

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Significant Accounting Policies

6 Months Ended

May 31, 2023

Significant Accounting Policies

Significant Accounting Policies

3. Significant accounting policies

(a) Revenue recognition

The Company accounts for revenue in accordance with the provisions of ASC Topic 606 Revenue from Contracts with Customers. Under ASC Topic 606, the Company recognizes revenue when the customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed under ASC Topic 606: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation(s). The Company earns revenue from non-refundable upfront fees, milestone payments upon achievement of specified research or development, exclusivity milestone payments and licensing payments on sales of resulting products.

The relevant revenue recognition accounting policy is applied to each separate unit of accounting.

Licensing

The Company recognizes revenue from the licensing of the Company's drug delivery technologies, products and product candidates. Under the terms of the licensing arrangements, the Company provides the customer with a right to access the Company’s intellectual property with regards to the license which is granted. Revenue arising from the license of intellectual property rights is recognized over the period the Company transfers control of the intellectual property.

The Company has a license and commercialization agreement with Par Pharmaceutical Inc. (“Par”). Under the exclusive territorial license rights granted to Par, the agreement requires that Par manufacture, promote, market, sell and distribute the product. Licensing revenue amounts receivable by the Company under this agreement are calculated and reported to the Company by Par, with amounts generally based upon net product sales and net profit which include estimates for chargebacks, rebates, product returns, and other adjustments. Licensing revenue payments received by the Company from Par under this agreement are not subject to further deductions for chargebacks, rebates, product returns, and other pricing adjustments. Based on this arrangement and the guidance per ASC Topic 606, the Company records licensing revenue over the period the Company transfers control of the intellectual property in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

Milestones

For milestone payments that are not contingent on sales-based thresholds, the Company applies a most-likely amount approach on a contract-by-contract basis. Management makes an assessment of the amount of revenue expected to be received based on the probability of the milestone outcome. Variable consideration is included in revenue only to the extent that it is probable that the amount will not be subject to a significant reversal when the uncertainty is resolved (generally when the milestone outcome is satisfied).

Research and development

Under arrangements where the license fees and research and development activities can be accounted for as a separate unit of accounting, non-refundable upfront license fees are deferred and recognized as revenue on a straight-line basis over the expected term of the Company's continued involvement in the research and development process.

Deferred revenue

Deferred revenue represents the funds received from clients, for which the revenues have not yet been earned, as the milestones have not been achieved, or in the case of upfront fees for drug development, where the work remains to be completed. As of November 30, 2022, the Company has recorded a deferred revenue balance of $Nil (November 30, 2021 - $Nil) due to the termination of its license and commercial supply agreement with Mallinckrodt.

(b) Research and development costs

Research and development costs related to continued research and development programs are expensed as incurred in accordance with ASC Topic 730 Research and Development. However, materials and equipment are capitalized and amortized over their useful lives if they have alternative future uses.

(c) Translation of foreign currencies

Transactions denominated in currencies other than the Company and its wholly owned operating subsidiaries’ functional currencies, monetary assets and liabilities are translated at the period end rates. Revenue and expenses are translated at rates of exchange prevailing on the transaction dates. All of the exchange gains or losses resulting from these other transactions are recognized in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

The functional and reporting currency of the Company and its subsidiaries is the U.S. dollar.

(d) Investment tax credits

The investment tax credits (“ITC") receivable are amounts considered recoverable from the Canadian federal and provincial governments under the Scientific Research & Experimental Development (“SR&ED”) incentive program. The amounts claimed under the program represent the amounts based on management estimates of eligible research and development costs incurred during the year. Realization is subject to government approval. Any adjustment to the amounts claimed will be recognized in the year in which the adjustment occurs. Refundable ITCs claimed relating to capital expenditures are credited to property and equipment. Refundable ITCs claimed relating to current expenditures are netted against research and development expenditures.

(e) Loss per share

Basic loss per share (“EPS”) is computed by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive.

The dilutive effect of stock options is determined using the treasury stock method.

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Property and Equipment

6 Months Ended

May 31, 2023

Property and Equipment

Property and Equipment

4. Property and equipment

	Computer equipment		Computer software		Furniture and fixtures		Laboratory equipment		Leasehold improvements		Total
	$		$		$		$		$		$
Cost
Balance at November 30, 2021		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Impairment of asset		-		-		-		-		-		-
Balance at November 30, 2022		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Balance at February 28, 2023		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Accumulated depreciation
Balance at November 30, 2021		565,088		154,500		150,991		4,157,060		1,441,452		6,469,091
Depreciation		19,874		924		4,301		180,959		-		206,058
Balance at November 30, 2022		584,962		155,424		155,292		4,338,019		1,441,452		6,675,149
Depreciation		6,972		214		14,095		60,010		-		81,291
Balance at May 31, 2023		591,934		155,638		169,387		4,398,029		1,441,452		6,756,440
Net book value at:
November 30, 2022		46,372		635		17,206		723,838		-		788,051
May 31, 2023		39,400		421		3,111		663,828		-		706,760

Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Impairment is assessed by comparing the carrying amount of an asset with the sum of the undiscounted cash flows expected from its use and disposal, and as such requires the Company to make significant estimates on expected revenues from the commercialization of its products and services and the related expenses. The Company records a write-down for long-lived assets which have been abandoned and do not have any residual value. Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that

the carrying value of an asset may not be recoverable. Impairment is assessed by comparing the carrying amount of an asset with the sum of the undiscounted cash flows expected from its use and disposal, and as such requires the Company to make significant estimates on expected revenues from the commercialization of its products and services and the related expenses. The Company records a write-down for long-lived assets which have been abandoned and do not have any residual value.

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Convertible debentures and promissory notes payable

6 Months Ended

May 31, 2023

Convertible debentures and promissory notes payable

Convertible debentures and promissory notes payable

5. Convertible debentures and promissory notes payable

(a) Convertible debentures

Amounts due to the related parties are payable to two shareholders who are also officers and directors of the Company.

	May 31,		November 30,
	2023		2022
Convertible debenture payable to two directors and officers of the
Company, unsecured, 10% annual interest rate,
payable monthly (“2018 Debenture”)	$	500,000	$	500,000
Convertible debenture payable to two directors and officers of the
Company, unsecured, 12% annual interest rate,
payable monthly (“May 2019 Debenture”)		1,050,000		1,050,000
Convertible debenture payable to two directors and officers of the
Company, unsecured, 12% annual interest rate,
payable monthly (“November 2019 Debenture”)		250,000		250,000
	$	1,800,000	$	1,800,000

On September 10, 2018, the Company completed a private placement financing of the unsecured convertible 2018 Debenture in the principal amount of $0.5 million. The 2018 Debenture matured on September 1, 2020. The 2018 Debenture bore interest at a rate of 10% per annum, payable monthly, was pre-payable at any time at the option of the Company and was convertible at any time into common shares of the Company at a conversion price of $3.00 per common share at the option of the holder. Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors and executive officers of the Company provided the Company with the $0.5 million of the proceeds for the 2018 Debenture.

At issuance, as the conversion price was lower than the market share price, the beneficial conversion feature valued at September 10, 2018 of $66,667 was allocated to Additional paid-in capital. Subsequently, the fair value of the 2018 Debenture was accreted over the remaining life of the 2018 Debenture using an effective rate of interest of 7.3%. Effective September 1, 2020, the maturity date for the 2018 Debenture was further extended to November 30, 2020. Under ASC Subtopic 470-50, the change in the debt instrument was accounted for as an extinguishment of debt. At the date of extinguishment, the Company derecognized the carrying amount of convertible debt of $0.5 million and recorded the new convertible debt at the fair value of $0.5 million, resulting in no gain or loss. The carrying amount of the debt instrument is accreted over the remaining life of the 2018 Debenture using a nominal effective rate of interest. As of November 30, 2022 the maturity date for the 2018 Debenture was further extended to August 31, 2023.

Effective May 31, 2022, the maturity date for the May 2019 Debenture was further extended to November 30, 2022. Under ASC Subtopic 470-50, the change in the debt instrument was accounted for as an extinguishment of debt. At the date of extinguishment, the Company derecognized the carrying amount of convertible debt of $1,050,000 and recorded the new convertible debt at the fair value of $1,050,000, resulting in no gain or loss. The carrying amount of the debt instrument is accreted over the remaining life of the May 2019 Debenture using a nominal effective rate of interest. As of November 30, 2022 the maturity date for the May 2019 Debenture was further extended to August 31, 2023.

Effective May 31, 2022, the maturity date for the November 2019 Debenture was further extended to November 30, 2022. Under ASC Subtopic 470-50, the change in the debt instrument was accounted for as an extinguishment. In accordance with ASC paragraph 470-50-40-2, extinguishment transactions between related entities are treated as capital transactions. At the date of extinguishment, the Company derecognized the carrying amount of convertible debt of $250,000 and recorded the new convertible debt at the fair value of $250,000, resulting in no gain or loss. The carrying amount of the debt instrument is accreted over the remaining life of the November 2019 Debenture using a nominal effective rate of interest. As of November 30, 2022 the maturity date for the November 2019 Debenture was further extended to August 31, 2023.

Accreted interest expense during the three and six months ended May 31, 2023 is $Nil and $Nil (three and six months ended May 31, 2022 is $20,834 and $69,351) and has been included in interest expense in the condensed unaudited interim consolidated statements of operations and comprehensive loss. In addition, the coupon interest on the 2018 Debenture, May 2019 Debenture and November 2019 Debenture (collectively, the “Debentures”) for the three and six months ended May 31, 2023 is $51,888 and $102,648 (three and six months ended May 31, 2022 – $51,888 and $102,648) and has also been included in interest expense in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

(b) Promissory notes payable

	May 31,		November 30,
	2023		2022
	$		$
Promissory notes payable to two directors and officers
of the Company, unsecured, no annual interest
rate on the outstanding loan balance		156,377		157,437
Promissory notes payable to third party
unsecured, 10% annual interest
rate on the outstanding loan balance		203,077		203,077
		359,454		360,514

In September 2019, the Company issued two unsecured, non-interest bearing promissory notes, with no fixed repayment terms, in the amounts of US$6,500 and CDN$203,886, to Dr. Isa Odidi and Dr. Amina Odidi, who are shareholders, directors and executive officers of the Company.

In October 2022, the Company issued an unsecured, 10% annual interest bearing promissory note, with a 6 month fixed repayment term, in the amount of US$200,000.

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Lease

6 Months Ended

May 31, 2023

Lease

Lease

6. Lease

On December 1, 2015, the Company entered into a new lease agreement for the premises that it currently operates from, as well the adjoining property, which is owned by the same landlord, for a 5-year term with a 5-year renewal option. On June 21, 2020, the Company entered into a lease surrender agreement and vacated one of its premises on June 30, 2020. On August 20, 2020, The Company extended its lease for the premises that it currently operates from, for one year, commencing December 1, 2020, with an option to continue on a month-to-month basis after November 30, 2021.This operating lease was capitalized under ASC Topic 842 effective on the August 20, 2020 date of extension.

The gross amounts of assets and liabilities related to operating leases were as follows:

	May 31, 2023		November 30, 2022
Assets:
Operating lease right-of-use asset	$	75,204	$	151,471
Liabilities:
Current:
Operating lease liability	$	84,466	$	165,441
Total lease liability	$	84,466	$	165,441

For the three months ended May 31, 2023, lease payments of $87,293 were paid in relation to the operating lease liability.

Lease terms and discount rates are as follows:

	May 31, 2023
Remaining lease term (months)		6
Estimated incremental borrowing rate		11.4	%

The approximate future minimum lease payments for the operating lease as at May 31, 2023 were as follows:

	May 31, 2023
Lease payments for remainder of year	$	87,293
Less imputed interest		2,827
Present value of lease liabilities	$	84,466

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Capital Stock

6 Months Ended

May 31, 2023

Capital Stock

Capital Stock

7. Capital stock

Authorized, issued and outstanding

(a) The Company is authorized to issue an unlimited number of common shares, all without nominal or par value and an unlimited number of preference shares. As at May 31, 2023, the Company had 33,092,665 (May 31, 2022 – 33,092,665) common shares issued and outstanding and no preference shares issued and outstanding. Two officers and directors of the Company owned directly and through their family holding company 578,131 (November 30, 2022 – 578,131) common shares or approximately 1.7% (November 30, 2022 – 1.7%) of the issued and outstanding common shares of the Company as at May 31, 2023.

Each common share of the Company entitles the holder thereof to one vote at any meeting of shareholders of the Company, except meetings at which only holders of a specified class of shares are entitled to vote.

Holders of common shares of the Company are entitled to receive, as and when declared by the board of directors of the Company, dividends in such amounts as shall be determined by the board.

The holders of common shares of the Company have the right to receive the remaining property of the Company in the event of liquidation, dissolution, or winding-up of the Company, whether voluntary or involuntary.

The preference shares may at any time and from time to time be issued in one or more series. The board of directors will, by resolution, from time to time, before the issue thereof, fix the rights, privileges, restrictions and conditions attaching to the preference shares of each series. Except as required by law, the holders of any series of preference shares will not as such be entitled to receive notice of, attend or vote at any meeting of the shareholders of the Company. Holders of preference shares will be entitled to preference with respect to payment of dividends and the distribution of

assets in the event of liquidation, dissolution or winding-up of the Company, whether voluntary or involuntary, or any other distribution of the assets of the Company among its shareholders for the purpose of winding up its affairs, on such shares over the common shares of the Company and over any other shares ranking junior to the preference shares.

In April 2021, the Company completed a private placement offering of an aggregate of 9,414,560 common shares at a price of CAD$0.41 per Common Share. The Company recorded $3,069,448 44as the value of common shares under Capital stock in 3. The direct costs related to the issuance of the common shares were $38,220. These direct costs were recorded as an offset against the condensed unaudited interim consolidated statements of shareholders’ equity (deficiency).

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Options

6 Months Ended

May 31, 2023

Options

Options

8. Options

All grants of options to employees after October 22, 2009 are made from the Employee Stock Option Plan (the “Employee Stock Option Plan”). The maximum number of common shares issuable under the Employee Stock Option Plan is limited to 10% of the issued and outstanding common shares of the Company from time to time, or 3,309,267 based on the number of issued and outstanding common shares as at May 31, 2023. As at May 31, 2023, 1,309,000 options are outstanding and there were 2,000,267 options available for grant under the Employee Stock Option Plan. Each option granted allows the holder to purchase one common share at an exercise price not less than the closing price of the Company's common shares on the TSX on the last trading day prior to the grant of the option. Options granted under these plans typically have a term of 5 years with a maximum term of 10 years and generally vest over a period of up to three years.

In the three and six months ended May 31, 2023, Nil (three and six months ended May 31, 2022 –- Nil) stock options were granted.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes Option-Pricing Model, consistent with the provisions of ASC Topic 718. Compensation—Stock Compensation Option pricing models require the use of subjective assumptions, changes in these assumptions can materially affect the fair value of the options. The Company calculates expected volatility based on historical volatility of the Company’s own volatility for options that have an expected life of less than ten years. The expected term, which represents the period of time that options granted are expected to be outstanding, is estimated based on the historical average of the term and historical exercises of the options. The risk-free rate assumed in valuing the options is based on the U.S. treasury yield curve in effect at the time of grant for the expected term of the option.

The expected dividend yield percentage at the date of grant is Nil as the Company is not expected to pay dividends in the foreseeable future.

Details of stock option transactions in Canadian dollars (“C$”) are as follows:

	May 31, 2023						May 31, 2022
			Weighted							Weighted
			average		Weighted					average		Weighted
			exercise		average					exercise		average
	Number of		price per		grant date		Number of			price per		grant date
	options		share		fair value		options			share		fair value
	#		$		$		#			$		$
Outstanding, beginning of period		1,309,000		0.35		0.27		1,489,500			2.40		1.80
Expired		-		-		-		(85,000	)		32.70		25.08
Outstanding, end of period		1,309,000		0.35		0.27		1,404,500			0.55		0.38
Options exercisable, end of period		1,309,000		0.35		0.27		1,404,500			0.55		0.38

Total unrecognized compensation cost relating to the unvested performance-based stock options at May 31, 2023 is $Nil (May 31, 2022 - $Nil).

For the three and six months ended May 31, 2023 and 2022, no options were exercised.

The Company has estimated its stock option forfeitures to be approximately 4% for the three and six months ended May 31, 2023 (three and six months ended May 31, 2022 – 4%).

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Deferred Share Units

6 Months Ended

May 31, 2023

Deferred Share Units

Deferred Share Units

9. Deferred share units

Effective May 28, 2010, the Company’s shareholders approved a Deferred Share Unit (“DSU”) Plan to grant DSUs to its non-management directors and reserved a maximum of 11,000 common shares for issuance under the plan. The DSU Plan permits certain non-management directors to defer receipt of all or a portion of their board fees until termination of the board service and to receive such fees in the form of common shares at that time. A DSU is a unit equivalent in value to one common share of the Company based on the trading price of the Company's common shares on the TSX.

Upon termination of board service, the director will be able to redeem DSUs based upon the then market price of the Company's common shares on the date of redemption in exchange for any combination of cash or common shares as the Company may determine.

During the three and six months ended May 31, 2023, no non-management board members elected to receive director fees in the form of DSUs under the Company’s DSU Plans. As at May 31, 2023, Nil (May 31, 2022 Nil) DSUs were outstanding and 11,000 (May 31, 2022 – 11,000) DSUs were available for grant under the DSU Plan.

During the three and six months ended May 31, 2023 and 2022, no DSUs were exercised.

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Warrants

6 Months Ended

May 31, 2023

Warrants

Warrants

10. Warrants

All of the Company’s outstanding warrants are considered to be indexed to the Company’s own stock and are therefore classified as equity under ASC 480.Topic 480 Distinguishing Liabilities from Equity. The warrants, in specified situations, provide for certain compensation remedies to a holder if the Company fails to timely deliver the shares underlying the warrants in accordance with the warrant terms.

The following table provides information on the 21,160,314 warrants, including 2018 Firm Warrants, outstanding and exercisable as of May 31, 2023:

	Exercise		Number			Shares issuable
Warrant	price ($)		outstanding		Expiry	upon exercise
2018 Firm Warrants		0.75		20,000,000	October 16, 2023		20,000,000
October 2018 Placement Agent Warrants		0.9375		1,160,314	October 16, 2023		1,160,314
				21,160,314			21,160,314

During the three and six months ended May 31, 2023, there were no cash exercises in respect of warrants (three and six months ended May 31, 2022 – Nil).

Details of warrant transactions for the six months ended May 31, 2023 and 2022 are as follows:

	Outstanding,  December 1, 2022		Issued		Expired		Exercised		Outstanding,  May 31,  2023
2018 Firm Warrants		20,000,000		-		-		-		20,000,000
October 2018 Placement
Agent Warrants		1,160,314		-		-		-		1,160,314
		21,160,314		-		-		-		21,160,314

	Outstanding,  December 1, 2021		Issued		Expired		Exercised		Outstanding,  May 31,  2022
2018 Firm Warrants		20,000,000		-		-		-		20,000,000
October 2018 Placement
Agent Warrants		1,160,314		-		-		-		1,160,314
		21,160,314		-		-		-		21,160,314

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Income Taxes

6 Months Ended

May 31, 2023

Income Taxes

Income Taxes

11. Income Taxes

The Company has had no taxable income under the Federal and Provincial tax laws of Canada for the three months ended 2023 and May 31, 2022. The Company has non-capital loss carry-forwards at May 31, 2023 in Canada $62,493,624 that must be offset against future taxable income. If not utilized, the loss carry-forwards will expire between 2028 and 2042.

For the three and six months ended May 31, 2022, the Company had a cumulative carry-forward pool of Canadian Federal Scientific Research & Experimental Development expenditures in the amount of approximately $15,951,739, which can be carried forward indefinitely.

For the three and six months ended May 31, 2022, the Company had approximately $2,933,013 of unclaimed Investment Tax Credits which expire from 2025 to 2040. These credits are subject to a full valuation allowance as they are not more likely than not to be realized.

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Contingencies

6 Months Ended

May 31, 2023

Contingencies (Note 12)

Contingencies

12. Contingencies

From time to time, the Company may be exposed to claims and legal actions in the normal course of business. As at May 31, 2023, and continuing as at July 14, 2023, the Company is not aware of anypending or threatenedmateriallitigation claimsagainst the Company, other than as described below.

In November 2016, the Company filed an NDA for its Oxycodone ER product candidate, relying on the 505(b)(2) regulatory pathway, which allowed the Company to reference data from Purdue Pharma L.P's (“Purdue”) file for its OxyContin® extended release oxycodone hydrochloride. The Oxycodone ER application was accepted by the FDA for further review in February 2017. The Company certified to the

FDA that it believed that its Oxycodone ER product candidate would not infringe any of the OxyContin® patents listed in the FDA’s Approved Drug Products with Therapeutic Equivalence Evaluations, commonly

known as the “Orange Book”, or that such patents are invalid, and so notified Purdue and the other owners of the subject patents listed in the Orange Book of such certification.

On April 7, 2017, the Company received notice that Purdue Pharma L.P., Purdue Pharmaceuticals L.P., The P.F. Laboratories, Inc., or collectively the Purdue parties, Rhodes Technologies, and Grünenthal GmbH, or collectively the Purdue litigation plaintiffs, had commenced patent infringement proceedings against the Company in the U.S. District Court for the District of Delaware (docket number 17-392) in respect of its NDA filing for Oxycodone ER, alleging that its proposed Oxycodone ER infringes six out of the 16 patents associated with the branded product OxyContin^®, or the OxyContin^® patents, listed in the Orange Book.

Subsequent to the above-noted filing of lawsuit, four further such patents were listed and published in the Orange Book. On March 16, 2018, the Company received notice that the Purdue litigation plaintiffs had commenced further such patent infringement proceedings adding the four further patents. On April 15, 2020, Purdue filed a new patent infringement suit against the Company relating to additional Paragraph IV certifications lodged against two more listed Purdue patents.

As a result of the commencement of the first of these legal proceedings, the FDA was stayed for 30 months from granting final approval to the Company’s Oxycodone ER product candidate. That time period commenced on February 24, 2017, when the Purdue litigation plaintiffs received notice of the Company’s certification concerning the patents, and were to expire on August 24, 2019, unless the stay was earlier terminated by a final declaration of the courts that the patents are invalid, or are not infringed, or the matter is otherwise settled among the parties. On April 24, 2019, an order was issued, setting a trial date of

November 12, 2019 for case number 17-392 in the District of Delaware, and also extending the 30-month stay date for regulatory approval to March 2, 2020.

On or about June 26, 2018, the court issued an order to sever 6 “overlapping” patents from the second Purdue case but ordered litigation to proceed on the 4 new (2017-issued) patents. An answer and counterclaim was filed on July 9, 2018. On July 6, 2018, the court issued a so-called “Markman” claim construction ruling on the first case. On July 24, 2018, the parties to the case mutually agreed to and did

have dismissed without prejudice the infringement claims related to the Grünenthal ‘060 patent, which is one of the six patents included in the original litigation case.

On October 4, 2018, the parties mutually agreed to postpone the scheduled court date pending a case status conference scheduled for December 17, 2018. At that time, further trial scheduling and other administrative matters were postponed pending the Company’s resubmission of the Oxycodone ER NDA to the FDA, which was made on February 28, 2019. On January 17, 2019, the court issued a scheduling order in which the remaining major portions are scheduled. The trial was scheduled for June 2020.

On April 4, 2019, the U.S. Federal Circuit Court of Appeals affirmed the invalidity of one Purdue OxyContin® formulation patent, subject to further appeal to the U.S. Supreme Court.

Following the filing of a bankruptcy stay by Purdue Pharma L.P., the Company’s ongoing litigation case numbers 1:17-cv-00392-RGA and 1:18-cv-00404-RGA-SRF between Purdue Pharma L.P. et al and The Company were stayed and the existing trial dates in both cases vacated by orders issued in each case by the judge in the District of Delaware on October 3, 2019. With the litigation stay order, the previous 30-month stay date of March 2, 2020 was unchanged.

On or about July 2, 2020 the parties in the cases, numbers 17-cv-392-RGA, 18-cv-404-RGA and 20-cv-515-RGA (the “Litigations”) between Purdue Pharma L.P. et al (“Purdue’) and Intellipharmaceutics entered into a stipulated dismissal of the Litigations. The stipulated dismissal, which was subject to approval by the bankruptcy court presiding over Purdue Pharma’s pending chapter 11 cases, provides for the termination of the patent infringement proceedings. The stipulated dismissal also provides that (i) for a thirty (30) day period following a final approval of the Company’s Aximris XRTM NDA the parties will attempt to resolve any potential asserted patent infringement claims relatingto the NDA and (ii) if the parties fail to resolve all such claims during such periodPurdue Pharma will have fifteen (15) days to pursue an

infringement action against the Company.The terms of the stipulated dismissal agreement are confidential.

On July 28, 2020 theU.S.District Court for the District of Delaware signed the stipulations of dismissal into order thereby dismissing the claims in the three cases without prejudice.In consideration of the confidential stipulated dismissal agreement andfor future saved litigation expenses, Purduepaidan amount to the Company.

In July 2017, three complaints were filed in the U.S. District Court for the Southern District of New York that were later consolidated under the caption Shanawaz v. Intellipharmaceutics Int’l Inc., et al., No. 1:17-cv-05761 (S.D.N.Y.). The lead plaintiffs filed a consolidated amended complaint on January 29, 2018. In the amended complaint, the lead plaintiffs assert claims on behalf of a putative class consisting of purchasers of the Company’s securities between May 21, 2015 and July 26, 2017. The amended complaint alleges that the defendants violated Sections 10(b) and 20(a) of the U.S. Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder by making allegedly false and misleading statements or failing to disclose certain information regarding the Company’s NDA for Oxycodone ER abuse-deterrent oxycodone hydrochloride extended release tablets. The complaint seeks, among other remedies, unspecified damages, attorneys’ fees and other costs, equitable and/or injunctive relief, and such other relief as the court may find just and proper.

On November 7, 2019, the Company announced that the parties reached a settlement that is subject to the approval of the court following notice to class members. The stipulation of settlement provides for a settlement payment of US$1.6 million by the Company, which has been paid from available insurance coverage.

As part of the settlement, the Company also agreed to contribute to the settlement fund specific anticipated Canadian tax refunds of up to US$400,000 to the extent received within 18 months after the entry of final judgment. The stipulation of settlement acknowledges that the Company and the other defendants continue to deny that they committed any violation of the U.S. securities laws or engaged in any other wrongdoing and that they are entering into the settlement at this time based on the burden, expense, and inherent uncertainty of continuing the litigation. On December 7, 2020 the court approved the settlement and entered an order and final judgement to that effect, thereby concluding the case.

On February 21, 2019, the Company and its CEO, Dr. Isa Odidi (“Defendants”), were served with a Statement of Claim filed in the Superior Court of Justice of Ontario (“Court”) for a proposed class action under the Ontario Class Proceedings Act (“Action”). The Action was brought by Victor Romita, the proposed representative plaintiff (“Plaintiff”), on behalf of a class of Canadian persons (“Class”) who traded shares of the Company during the period from February 29, 2016 to July 26, 2017 (“Period”). The Statement of Claim, under the caption Victor Romita v. Intellipharmaceutics International Inc. and Isa Odidi, asserted that the defendants knowingly or negligently made certain public statements during the relevant period that contained or omitted material facts concerning Oxycodone ER abuse-deterrent oxycodone hydrochloride extended-release tablets. The plaintiff alleges that he and the class suffered loss and damages as a result of their trading in the Company’s shares during the relevant period. The plaintiff seeks, among other remedies, unspecified damages, legal fees and court and other costs as the Court may permit. On February 26, 2019, the plaintiff delivered a Notice of Motion seeking the required approval from the Court, in accordance with procedure under the Ontario Securities Act, to allow the statutory claims under the Ontario Securities Act to proceed with respect to the claims based upon the acquisition or disposition of the Company’s shares on the TSX during the Period (“Motion”). On June 28, 2019, the Court endorsed a timetable for the exchange of material leading to the hearing of the Motion scheduled for January 27-28, 2020. On October 28, 2019, plaintiff’s counsel advised the court that the Plaintiff intended to amend his claim and could not proceed with the Leave Motion scheduled for January 27-28, 2020. As such, the Court released those dates. On January 28, 2020 the plaintiff served a Notice of Motion for leave to amend the Statement of Claim. On April 2, 2020 the plaintiff delivered an Amended Motion Record and Amended Notice of Motion seeking an order for leave to issue a fresh as Amended Statement of Claim including the addition of Christopher Pearce as a Plaintiff (“Amendment Motion”).

On May 1, 2020, the court granted the plaintiff’s Amendment Motion. An order for leave to proceed for settlement purposes was granted on 25 June 2021. At a hearing on October 12,2021, the Court approved the settlement. The stipulation of settlement provides for a settlement payment of CAD$266,000 by the Company, CAD$226,000 was paid from insurance coverage while the Company paid CAD$40,000. Therefore, this action is now settled.

On October 7, 2019, a complaint was filed in the U.S. District Court for the Southern District of New York by Alpha Capital Anstalt (“Alpha”) against the Company, two of its existing officers and directors and its former Chief Financial Officer. In the complaint, Alpha alleged that the Company and the executive officers/directors named in the complaint violated Sections 11, 12(a)(2) and 15 of the U.S. Securities Act of 1933, as amended, by allegedly making false and misleading statements in the Company’s Registration Statement on Form F-1 filed with the U.S. Securities and Exchange Commission on September 20, 2018, as amended (the “Registration Statement”) by failing to disclose certain information regarding the resignation of the Company’s then Chief Financial Officer, which was announced several weeks after such registration statement was declared effective. In the complaint, Alpha seeks unspecified damages, rescission of its purchase of the Company’s securities in the relevant offering, attorneys’ fees and other costs and further relief as the court may find just and proper. On December 12, 2019, the Company and the other defendants in the action filed a motion to dismiss for failure to state a claim. The plaintiff filed an opposition to that motion on February 4, 2020 and a reply brief in further support of the motion to dismiss the action was filed March 6, 2020. In addition, the Court scheduled a mandatory settlement conference with the Magistrate Judge for April 23, 2020 which the Company and its counsel attended. On June 18, 2020, the court largely denied the Company’s motion to dismiss the action. Briefing on these motions was completed on February 19, 2021. In a court order filed July 9, 2021, the District Court issued an opinion and order granting summary judgment in the Company’s favor and ordered the case closed. The judgment was entered on July 12, 2021. On August 10, 2021, the Plaintiff filed a notice of appeal. On October 1, 2021, the Plaintiff filed a notice of voluntary dismissal of the appeal with prejudice, stipulated to by the Company. The Court of Appeals “so ordered” the voluntary dismissal stipulation and the appeal was

dismissed. As a result, the matter has been fully resolved in favor of the Company and the named individual Defendants.

On or about August 5, 2020 a former employee filed a claim against the Company for wrongful dismissal of employment plus loss of benefits, unpaid vacation pay, interest and costs. The parties have agreed to settlement terms in the matter. The Company has fulfilled the terms and has received a release and consent to dismiss. A dismissal order is pending from the court.

On or about August 9, 2022, a service provider brought to the Company’s attention a Motion Record to seek judgement with respect to amounts owed it by the Company for the principal amount owed, plus pre-judgment interest and costs. We found out then, that a statement of claim dated May 3, 2021 was delivered to the Company’s premises. The Company did not respond to the claim because it was inadvertently never brought to the attention of management, as a result the Company was noted in default in May 31, 2021. The Company was not aware of claim and the default before August 9, 2022. The Company has signed a consent which allows the other party to obtain judgement from a court and take steps to enforce judgement if we default on certain conditions.

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Financial Instruments

6 Months Ended

May 31, 2023

Financial Instruments

Financial Instruments

13. Financial instruments

(a) Fair values

The Company follows ASC Topic 820 Fair Value Measurement (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The provisions of ASC Topic 820 apply to other accounting pronouncements that require or permit fair value measurements. ASC Topic 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date; and establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date.

Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. To increase consistency and comparability in fair value measurements and related disclosures, the fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels.

The three levels of the hierarchy are defined as follows:

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly for substantially the full term of the financial instrument.

Level 3 inputs are unobservable inputs for asset or liabilities.

The categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

(i) The Company calculates fair value of the options and warrants using its own historical volatility (Level 1).

(ii) The Company calculates the interest rate for the conversion option based on the Company’s estimated cost of raising capital (Level 2).

An increase/decrease in the volatility and/or a decrease/increase in the discount rate would have resulted in an increase/decrease in the fair value of the conversion option and warrants.

Fair value of financial assets and financial liabilities that are not measured at fair value on a recurring basis are as follows:

	May 31, 2023				November 30, 2022
	Carrying		Fair		Carrying		Fair
	amount		value		amount		value
	$		$		$		$
Financial Liabilities
Convertible debentures(i)		1,800,000		1,783,882		1,800,000		1,753,406
Promissory notes payable(i)		359,454		359,454		360,514		360,514

(i) The Company calculates the interest rate for the Debentures and promissory notes payable based on the Company’s estimated cost of raising capital and uses the discounted cash flow model to calculate the fair value of the Debentures and the promissory notes payable.

The carrying values of cash, accounts receivable, accounts payable, accrued liabilities and employee cost payable approximates their fair values because of the short-term nature of these instruments.

(b) Interest rate and credit risk

Interest rate risk is the risk that the value of a financial instrument might be adversely affected by a change in interest rates. The Company does not believe that the results of operations or cash flows would be affected to any significant degree by a sudden change in market interest rates, relative to interest rates on cash and the convertible debenture due to the short-term nature of these obligations. Trade accounts receivable potentially subjects the Company to credit risk. The Company provides an allowance for doubtful accounts equal to the estimated losses expected to be incurred in the collection of accounts receivable.

The following table sets forth details of the aged accounts receivable that are not overdue as well as an analysis of overdue amounts and the related allowance for doubtful accounts:

	May 31,		November 30,
	2023		2022
	$		$
Accounts receivable		333,582		602
Less allowance for doubtful accounts		-		-
Total trade and other receivables, net		333,582		602
Not past due		333,582		602
Past due for more than 31 days
but no more than 120 days		-		-
Past due for more than 120 days		-		-
Total trade and other receivables, gross		333,582		602

Financial instruments that potentially subject the Company to concentration of credit risk consist principally of uncollateralized accounts receivable. The Company’s maximum exposure to credit risk is equal to the potential amount of financial assets. For the three months ended May 31, 2023, one customer accounted for all the revenues and all the accounts receivable of the Company.

The Company is also exposed to credit risk at period end from the carrying value of its cash. The Company manages this risk by maintaining bank accounts with a Canadian Chartered Bank. The Company’s cash is not subject to any external restrictions.

(c) Foreign exchange risk

The Company has balances in Canadian dollars that give rise to exposure to foreign exchange risk relating to the impact of translating certain non-U.S. dollar balance sheet accounts as these statements are presented in U.S. dollars. A strengthening U.S. dollar will lead to a foreign exchange loss while a weakening U.S. dollar will lead to a foreign exchange gain. For each Canadian dollar balance of $1.0 million, a +/- 10% movement in the Canadian currency held by the Company versus the U.S. dollar would affect the Company’s loss and other comprehensive loss by $0.1 million.

(d) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty raising liquid funds to meet its commitments as they fall due. In meeting its liquidity requirements, the Company closely monitors its forecasted cash requirements with expected cash drawdown.

The following are the contractual maturities of the undiscounted cash flows of financial liabilities as at May 31, 2023:

	Less than		3 to 6		6 to 9		9 months		Greater than
	3 months		months		months		to 1 year		1 year		Total
	$		$		$		$		$		$
Accounts payable		3,672,776		-		-		-		-		3,672,776
Accrued liabilities		3,284,320		-		-		-		-		3,284,320
Employee costs payable		3,491,952		-		-		-		-		3,491,952
Operating lease liabiity		45,891		45,891		-		-		-		91,782
Convertible debentures (Note 5)		1,800,000		-		-		-		-		1,800,000
Promissory notes payable (Note 5)		359,454		-		-		-		-		359,454
Total contractual obligations		12,654,393		45,891		-		-		-		12,700,284

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Segmented Information

6 Months Ended

May 31, 2023

Segmented Information

Segmented Information

14. Segmented information

The Company's operations comprise a single reportable segment engaged in the research, development and manufacture of novel and generic controlled-release and targeted-release oral solid dosage drugs. As the operations comprise a single reportable segment, amounts disclosed in the financial statements for revenue, loss for the period, depreciation and total assets also represent segmented amounts. In addition, all of the Company's long-lived assets are in Canada. The Company’s license and commercialization agreement with Par accounts for substantially all of the revenue of the Company.

	Three months ended				Six months ended
	May 31,		May 31,		May 31,		May 31,
	2023		2022		2023		2022
	$		$		$		$
Revenue
United States		806,546		-		16,978		16,978

	May 31,		November 30,
	2023		2022
	$		$
Total assets
Canada		1,735,410		1,432,032
Total property and equipment
Canada		706,760		788,050

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Significant Accounting Policies (Policies)

6 Months Ended

May 31, 2023

Significant Accounting Policies

Revenue recognition

The Company accounts for revenue in accordance with the provisions of ASC Topic 606 Revenue from Contracts with Customers. Under ASC Topic 606, the Company recognizes revenue when the customer obtains control of promised goods or services, in an amount that reflects the consideration the Company expects to receive in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed under ASC Topic 606: (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenues when (or as) the Company satisfies the performance obligation(s). The Company earns revenue from non-refundable upfront fees, milestone payments upon achievement of specified research or development, exclusivity milestone payments and licensing payments on sales of resulting products.

The relevant revenue recognition accounting policy is applied to each separate unit of accounting.

Licensing

The Company recognizes revenue from the licensing of the Company's drug delivery technologies, products and product candidates. Under the terms of the licensing arrangements, the Company provides the customer with a right to access the Company’s intellectual property with regards to the license which is granted. Revenue arising from the license of intellectual property rights is recognized over the period the Company transfers control of the intellectual property.

The Company has a license and commercialization agreement with Par Pharmaceutical Inc. (“Par”). Under the exclusive territorial license rights granted to Par, the agreement requires that Par manufacture, promote, market, sell and distribute the product. Licensing revenue amounts receivable by the Company under this agreement are calculated and reported to the Company by Par, with amounts generally based upon net product sales and net profit which include estimates for chargebacks, rebates, product returns, and other adjustments. Licensing revenue payments received by the Company from Par under this agreement are not subject to further deductions for chargebacks, rebates, product returns, and other pricing adjustments. Based on this arrangement and the guidance per ASC Topic 606, the Company records licensing revenue over the period the Company transfers control of the intellectual property in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

Milestones

For milestone payments that are not contingent on sales-based thresholds, the Company applies a most-likely amount approach on a contract-by-contract basis. Management makes an assessment of the amount of revenue expected to be received based on the probability of the milestone outcome. Variable consideration is included in revenue only to the extent that it is probable that the amount will not be subject to a significant reversal when the uncertainty is resolved (generally when the milestone outcome is satisfied).

Research and development

Under arrangements where the license fees and research and development activities can be accounted for as a separate unit of accounting, non-refundable upfront license fees are deferred and recognized as revenue on a straight-line basis over the expected term of the Company's continued involvement in the research and development process.

Deferred revenue

Deferred revenue represents the funds received from clients, for which the revenues have not yet been earned, as the milestones have not been achieved, or in the case of upfront fees for drug development, where the work remains to be completed. As of November 30, 2022, the Company has recorded a deferred revenue balance of $Nil (November 30, 2021 - $Nil) due to the termination of its license and commercial supply agreement with Mallinckrodt.

Research and development costs

Research and development costs related to continued research and development programs are expensed as incurred in accordance with ASC Topic 730 Research and Development. However, materials and equipment are capitalized and amortized over their useful lives if they have alternative future uses.

Translation of foreign currencies

Transactions denominated in currencies other than the Company and its wholly owned operating subsidiaries’ functional currencies, monetary assets and liabilities are translated at the period end rates. Revenue and expenses are translated at rates of exchange prevailing on the transaction dates. All of the exchange gains or losses resulting from these other transactions are recognized in the condensed unaudited interim consolidated statements of operations and comprehensive loss.

The functional and reporting currency of the Company and its subsidiaries is the U.S. dollar.

Investment tax credits

The investment tax credits (“ITC") receivable are amounts considered recoverable from the Canadian federal and provincial governments under the Scientific Research & Experimental Development (“SR&ED”) incentive program. The amounts claimed under the program represent the amounts based on management estimates of eligible research and development costs incurred during the year. Realization is subject to government approval. Any adjustment to the amounts claimed will be recognized in the year in which the adjustment occurs. Refundable ITCs claimed relating to capital expenditures are credited to property and equipment. Refundable ITCs claimed relating to current expenditures are netted against research and development expenditures.

Loss per share

Basic loss per share (“EPS”) is computed by dividing the loss attributable to common shareholders by the weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur from common shares issuable through the exercise or conversion of stock options, restricted stock awards, warrants and convertible securities. In certain circumstances, the conversion of options, warrants and convertible securities are excluded from diluted EPS if the effect of such inclusion would be anti-dilutive.

The dilutive effect of stock options is determined using the treasury stock method.

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Property and Equipment (Tables)

6 Months Ended

May 31, 2023

Property and Equipment

Schedule of property and equipment

	Computer equipment		Computer software		Furniture and fixtures		Laboratory equipment		Leasehold improvements		Total
	$		$		$		$		$		$
Cost
Balance at November 30, 2021		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Impairment of asset		-		-		-		-		-		-
Balance at November 30, 2022		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Balance at February 28, 2023		631,334		156,059		172,498		5,061,857		1,441,452		7,463,200
Accumulated depreciation
Balance at November 30, 2021		565,088		154,500		150,991		4,157,060		1,441,452		6,469,091
Depreciation		19,874		924		4,301		180,959		-		206,058
Balance at November 30, 2022		584,962		155,424		155,292		4,338,019		1,441,452		6,675,149
Depreciation		6,972		214		14,095		60,010		-		81,291
Balance at May 31, 2023		591,934		155,638		169,387		4,398,029		1,441,452		6,756,440
Net book value at:
November 30, 2022		46,372		635		17,206		723,838		-		788,051
May 31, 2023		39,400		421		3,111		663,828		-		706,760

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Convertible Debentures and Promissory Notes Payable (Tables)

6 Months Ended

May 31, 2023

Convertible debentures and promissory notes payable

Schedule of related party transactions

	May 31,		November 30,
	2023		2022
Convertible debenture payable to two directors and officers of the
Company, unsecured, 10% annual interest rate,
payable monthly (“2018 Debenture”)	$	500,000	$	500,000
Convertible debenture payable to two directors and officers of the
Company, unsecured, 12% annual interest rate,
payable monthly (“May 2019 Debenture”)		1,050,000		1,050,000
Convertible debenture payable to two directors and officers of the
Company, unsecured, 12% annual interest rate,
payable monthly (“November 2019 Debenture”)		250,000		250,000
	$	1,800,000	$	1,800,000

Schedule of Promissory notes payable

	May 31,		November 30,
	2023		2022
	$		$
Promissory notes payable to two directors and officers
of the Company, unsecured, no annual interest
rate on the outstanding loan balance		156,377		157,437
Promissory notes payable to third party
unsecured, 10% annual interest
rate on the outstanding loan balance		203,077		203,077
		359,454		360,514

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Lease (Tables)

6 Months Ended

May 31, 2023

Lease

Schedule of operating lease assets and liabilities

	May 31, 2023		November 30, 2022
Assets:
Operating lease right-of-use asset	$	75,204	$	151,471
Liabilities:
Current:
Operating lease liability	$	84,466	$	165,441
Total lease liability	$	84,466	$	165,441

Schedule of Lease terms and discount rates

	May 31, 2023
Remaining lease term (months)		6
Estimated incremental borrowing rate		11.4	%

Schedule of Future minimum lease payments

	May 31, 2023
Lease payments for remainder of year	$	87,293
Less imputed interest		2,827
Present value of lease liabilities	$	84,466

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Options (Tables)

6 Months Ended

May 31, 2023

Options

Schedule of stock option transactions

	May 31, 2023						May 31, 2022
			Weighted							Weighted
			average		Weighted					average		Weighted
			exercise		average					exercise		average
	Number of		price per		grant date		Number of			price per		grant date
	options		share		fair value		options			share		fair value
	#		$		$		#			$		$
Outstanding, beginning of period		1,309,000		0.35		0.27		1,489,500			2.40		1.80
Expired		-		-		-		(85,000	)		32.70		25.08
Outstanding, end of period		1,309,000		0.35		0.27		1,404,500			0.55		0.38
Options exercisable, end of period		1,309,000		0.35		0.27		1,404,500			0.55		0.38

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Warrants (Tables)

6 Months Ended

May 31, 2023

Warrants

Schedule of warrants outstanding and exercisable

	Exercise		Number			Shares issuable
Warrant	price ($)		outstanding		Expiry	upon exercise
2018 Firm Warrants		0.75		20,000,000	October 16, 2023		20,000,000
October 2018 Placement Agent Warrants		0.9375		1,160,314	October 16, 2023		1,160,314
				21,160,314			21,160,314

Schedule of warrant transactions

	Outstanding,  December 1, 2022		Issued		Expired		Exercised		Outstanding,  May 31,  2023
2018 Firm Warrants		20,000,000		-		-		-		20,000,000
October 2018 Placement
Agent Warrants		1,160,314		-		-		-		1,160,314
		21,160,314		-		-		-		21,160,314

	Outstanding,  December 1, 2021		Issued		Expired		Exercised		Outstanding,  May 31,  2022
2018 Firm Warrants		20,000,000		-		-		-		20,000,000
October 2018 Placement
Agent Warrants		1,160,314		-		-		-		1,160,314
		21,160,314		-		-		-		21,160,314

XML

Financial Instruments (Tables)

6 Months Ended

May 31, 2023

Financial Instruments

Schedule of fair value of assets and liabilities

	May 31, 2023				November 30, 2022
	Carrying		Fair		Carrying		Fair
	amount		value		amount		value
	$		$		$		$
Financial Liabilities
Convertible debentures(i)		1,800,000		1,783,882		1,800,000		1,753,406
Promissory notes payable(i)		359,454		359,454		360,514		360,514

Schedule of receivables

	May 31,		November 30,
	2023		2022
	$		$
Accounts receivable		333,582		602
Less allowance for doubtful accounts		-		-
Total trade and other receivables, net		333,582		602
Not past due		333,582		602
Past due for more than 31 days
but no more than 120 days		-		-
Past due for more than 120 days		-		-
Total trade and other receivables, gross		333,582		602

Schedule of contractual maturities of the undiscounted cash flows of financial liabilities

	Less than		3 to 6		6 to 9		9 months		Greater than
	3 months		months		months		to 1 year		1 year		Total
	$		$		$		$		$		$
Accounts payable		3,672,776		-		-		-		-		3,672,776
Accrued liabilities		3,284,320		-		-		-		-		3,284,320
Employee costs payable		3,491,952		-		-		-		-		3,491,952
Operating lease liabiity		45,891		45,891		-		-		-		91,782
Convertible debentures (Note 5)		1,800,000		-		-		-		-		1,800,000
Promissory notes payable (Note 5)		359,454		-		-		-		-		359,454
Total contractual obligations		12,654,393		45,891		-		-		-		12,700,284

XML

Segmented Information (Tables)

6 Months Ended

May 31, 2023

Segmented Information

Schedule of revenue from external customers and long-lived assets, by geographical areas

	Three months ended				Six months ended
	May 31,		May 31,		May 31,		May 31,
	2023		2022		2023		2022
	$		$		$		$
Revenue
United States		806,546		-		16,978		16,978

	May 31,		November 30,
	2023		2022
	$		$
Total assets
Canada		1,735,410		1,432,032
Total property and equipment
Canada		706,760		788,050

XML

Nature of Operations (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	May 31, 2023	May 31, 2022	May 31, 2023	May 31, 2022	Nov. 30, 2022
Nature of Operations
Net loss	$ (54,121)	$ (840,654)	$ (409,859)	$ (1,721,626)
Accumulated deficit	(105,543,958)		(105,543,958)		$ (105,134,099)
Working capital deficiency	$ (10,986,594)		$ (10,986,594)		$ (11,516,252)

XML

Basis of presentation (Details Narrative)	6 Months Ended
	May 31, 2023
Basis of Presentation
Description of business	1-for-10 reverse stock split

XML

Significant Accounting Policies (Details Narrative) - USD ($)	6 Months Ended
	May 31, 2023	Nov. 30, 2022	Nov. 30, 2021
Lease Term	12 months
Mallinckrodt LLC [Member]
Deferred revenue		$ 0	$ 0

XML

Property and Equipment (Details) - USD ($)	6 Months Ended	12 Months Ended
	May 31, 2023	Nov. 30, 2022
Cost, beginning balance	$ 7,463,200	$ 7,463,200
Impairment of asset		0
Impairment of asset		0
Cost, ending balance		7,463,200
Accumulated amortization, beginning balance	6,675,149	6,469,091
Depreciation	81,291	206,058
Accumulated amortization, ending balance	6,756,440	6,675,149
Property and equipment, net	706,760	788,051
Computer Equipment
Cost, beginning balance	631,334	631,334
Impairment of asset		0
Impairment of asset		0
Cost, ending balance		631,334
Accumulated amortization, beginning balance	584,962	565,088
Depreciation	6,972	19,874
Accumulated amortization, ending balance	591,934	584,962
Property and equipment, net	39,400	46,372
Computer Software
Cost, beginning balance	156,059	156,059
Impairment of asset		0
Impairment of asset		0
Cost, ending balance		156,059
Accumulated amortization, beginning balance	155,424	154,500
Depreciation	214	924
Accumulated amortization, ending balance	155,638	155,424
Property and equipment, net	421	635
Furniture and Fixtures
Cost, beginning balance	172,498	172,498
Impairment of asset		0
Impairment of asset		0
Cost, ending balance		172,498
Accumulated amortization, beginning balance	155,292	150,991
Depreciation	14,095	4,301
Accumulated amortization, ending balance	169,387	155,292
Property and equipment, net	3,111	17,206
Laboratory Equipment
Cost, beginning balance	5,061,857	5,061,857
Impairment of asset		0
Impairment of asset		0
Cost, ending balance		5,061,857
Accumulated amortization, beginning balance	4,338,019	4,157,060
Depreciation	60,010	180,959
Accumulated amortization, ending balance	4,398,029	4,338,019
Property and equipment, net	663,828	723,838
Leasehold Improvements
Cost, beginning balance	1,441,452	1,441,452
Impairment of asset		0
Impairment of asset		0
Cost, ending balance		1,441,452
Accumulated amortization, beginning balance	1,441,452	1,441,452
Depreciation	0	0
Accumulated amortization, ending balance	1,441,452	1,441,452
Property and equipment, net	$ 0	$ 0

XML

Convertible Debentures and Promissory Notes Payable (Details) - USD ($)	May 31, 2023	Nov. 30, 2022
Convertible debentures and promissory notes payable
Convertible debenture payable to two directors and officers of the Company, unsecured, 10% annual interest rate, payable monthly ("2018 Debenture")	$ 500,000	$ 500,000
Convertible debenture payable to two directors and officers of the Company, unsecured, 12% annual interest rate, payable monthly ("May 2019 Debenture")	1,050,000	1,050,000
Convertible debenture payable to two directors and officers of the Company, unsecured, 12% annual interest rate, payable monthly ("November 2019 Debenture")	250,000	250,000
Promissory note payable to two directors and officers of the Company, unsecured no annual interest rate on the outstanding loan balance	$ 1,800,000	$ 1,800,000

XML

Convertible Debentures and Promissory Notes Payable (Details 1) - USD ($)	May 31, 2023	Nov. 30, 2022
Promissory Notes Payable	$ 359,454	$ 360,514
Promissory notes payable to two directors and officers
Promissory Notes Payable	156,377	157,437
Promissory notes payable to third party
Promissory Notes Payable	$ 203,077	$ 203,077

XML

Convertible Debentures and Promissory Notes Payable (Details Narrative)		1 Months Ended	3 Months Ended		6 Months Ended
	Sep. 10, 2018 USD ($) $ / shares	Oct. 31, 2022 USD ($)	May 31, 2023 USD ($)	May 31, 2022 USD ($)	May 31, 2023 USD ($)	May 31, 2022 USD ($)	Feb. 28, 2023 USD ($)	Nov. 30, 2022 USD ($)	Feb. 28, 2022 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2019 CAD ($)
Convertible Debt Fair Value			$ 178,388,200,000	$ 1,050,000	$ 178,388,200,000	$ 1,050,000		$ 1,753,406
Carrying Amount Of Convertible Debt				1,050,000		1,050,000
Interest expense			51,888	73,466	102,648	174,029
Debt Instrument Interest Rate Effective	7.30%
Additional Paid-in Capital	$ 66,667
Convertible Debenture			51,888	51,888	51,888	51,888	$ 102,648	$ 51,888	$ 102,648		$ 203,886
Non-interest Bearing Promissory Notes										$ 6,500
Private Placement [Member]
Interest Rate	10.00%	10.00%
Debt Principal Amount	$ 500,000	$ 20,000,000,000
Proceeds From Debt	$ 500,000
Debt Conversion Price | $ / shares	$ 3.00
November 2019 Debenture [Member]
Convertible Debt Fair Value				250,000		250,000
Carrying Amount Of Convertible Debt				250,000		250,000
Interest expense			$ 0	$ 20,834	$ 0	$ 69,351

XML

Lease (Details) - USD ($)	May 31, 2023	Nov. 30, 2022
Lease
Operating Lease Right-of-use Asset	$ 75,204	$ 151,471
Current Operating Lease Liability	84,466	165,441
Total Lease Liability	$ 84,466	$ 165,441

XML

Lease (Details 1)	6 Months Ended
	May 31, 2023
Lease
Remaining Lease Term (months)	6 years
Estimated Incremental Borrowing Rate	11.40%

XML

Lease (Details 2) - USD ($)	May 31, 2023	Nov. 30, 2022
Lease
Lease payments for the remainder of the year ending	$ 87,293
Less imputed interest	2,827
Present value of lease liabilities	$ 84,466	$ 165,441

XML

Lease (Details Narrative) - USD ($)	3 Months Ended	6 Months Ended
	May 31, 2023	May 31, 2023
Lease
Renewal of Lease Term		5 years
Lease Payments	$ 87,293

XML

Capital Stock (Details Narrative)	1 Months Ended
	Apr. 30, 2021 USD ($) shares	May 31, 2023 USD ($) shares	Nov. 30, 2022 USD ($) shares	May 31, 2022 shares	Apr. 30, 2021 $ / shares
Common shares, issued		33,092,665	23,678,105	33,092,665
Common shares, outstanding		33,092,665	23,678,105	33,092,665
Private placement offering of an aggregate of common value | $		$ 49,175,630	$ 49,175,630
Officers and Directors
Common shares, issued		578,131	578,131
Common shares, outstanding		578,131	578,131
Noncontrolling interest, ownership percentage by noncontrolling owners		1.70%	1.70%
Private Placement [Member]
Private placement offering of an aggregate of common shares	9,414,560
Share issued, price per share | $ / shares					$ 0.41
Stock issuance costs | $	$ 38,220
Private placement offering of an aggregate of common value | $	$ 3,069,448

XML

Options (Details) - $ / shares	6 Months Ended
	May 31, 2023	May 31, 2022
Options
Options Outstanding, Beginning of period	1,309,000	1,489,500
Expired		85,000
Options Outstanding, End of period	1,309,000	1,404,500
Options exercisable, end of period	1,309,000	1,404,500
Weighted average exercise price outstanding, Beginning	$ 0.35	$ 2.40
Weighted average exercise price, Expired	0	32.70
Weighted average exercise price outstanding, Ending	0.35	0.55
Weighted average exercise price, Options exercisable end of period	0.35	0.55
Weighted average grant date fair value, Beginning	0.27	1.80
Weighted average grant date fair value, Expired	0	25.08
Weighted average grant date fair value, Ending	0.27	0.38
Weighted average grant date fair value, Options exercisable end of period	$ 0.27	$ 0.38

XML

Options (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	May 31, 2023	May 31, 2022	May 31, 2023	May 31, 2022	Nov. 30, 2022
Unrecognized compensation cost	$ 0	$ 0	$ 0	$ 0
Number of options outstanding	1,309,000		1,309,000
Options exercised	$ 0	$ 0	$ 0	$ 0
Stock option share-based compensation forfeiture rate	4.00%	4.00%	4.00%	4.00%
Common shares, outstanding	33,092,665	33,092,665	33,092,665	33,092,665	23,678,105
Employee Stock Option Plan [Member]
Share-based compensation arrangement by share-based payment award, options, grants in period			2,000,267
Common shares, outstanding	3,309,267		3,309,267
Lower [Member]
Options granted, term			5 years
Upper [Member]
Options granted, term			10 years

XML

Deferred Share Units (Details Narrative) - Deferred Share Units - shares	May 31, 2023	May 31, 2022	May 28, 2010
Common Shares Reserved Maximum For Issuance Under The Plan			11,000
Outstanding shares	0	0
Share based compensation arrangement by share based payment award number of shares available for grant	11,000	11,000

XML

Warrants (Details) - $ / shares	6 Months Ended
	May 31, 2023	May 31, 2022
Number Outstanding	21,160,314	21,160,314
Shares Issuable Upon Exercise	21,160,314	21,160,314
2018 Firm Warrants
Number Outstanding	20,000,000	20,000,000
Shares Issuable Upon Exercise	20,000,000	20,000,000
Exercise Price	$ 0.75
Expiry	Oct. 16, 2023
October 2018 Placement Agent Warrants
Number Outstanding	1,160,314
Shares Issuable Upon Exercise	1,160,314
Exercise Price	$ 0.9375
Expiry	Oct. 16, 2023

XML

Warrants (Details 1) - shares	May 31, 2023	May 31, 2022
Number Outstanding	21,160,314	21,160,314
Shares Issuable Upon Exercise	21,160,314	21,160,314
2018 Firm Warrants
Number Outstanding	20,000,000	20,000,000
Shares Issuable Upon Exercise	20,000,000	20,000,000
Agent Warrants
Number Outstanding	1,160,314	1,160,314
Shares Issuable Upon Exercise	1,160,314	1,160,314

XML

Warrants (Details 2) - shares	May 31, 2023	May 31, 2022
Number Outstanding	21,160,314	21,160,314
Shares Issuable Upon Exercise	21,160,314	21,160,314
2018 Firm Warrants
Number Outstanding	20,000,000	20,000,000
Shares Issuable Upon Exercise	20,000,000	20,000,000
Agent Warrants
Number Outstanding	1,160,314	1,160,314
Shares Issuable Upon Exercise	1,160,314	1,160,314

XML

Warrants (Details Narrative) - shares	May 31, 2023	May 31, 2022
Warrants
Shares Issuable Upon Exercise	21,160,314	21,160,314
Warrants	0	0

XML

Income taxes (Details Narrative) - USD ($)	May 31, 2023	May 31, 2022	Feb. 28, 2022
Income Taxes
Operating Loss Carryforwards	$ 62,493,624	$ 62,493,624
Research And Experimental Development Expenditures, Cumulative Carry-forwards		15,951,739	$ 15,951,739
Unclaimed Investment Tax Credits		$ 2,933,013	$ 2,933,013

XML

Contingencies (Details Narrative)	Oct. 12, 2021 CAD ($)	May 02, 2020 CAD ($)	Nov. 07, 2019 USD ($)
Contingencies (Note 12)
Payment for settlement	$ 40,000	$ 266,000	$ 1,600,000
Contribution to settlement fund			$ 400,000
Payment for settlement from insurance coverage	$ 226,000

XML

Financial Instruments (Details) - USD ($)	May 31, 2023	Nov. 30, 2022	May 31, 2022
Financial Liabilities
Convertible Debentures, Carrying Amount	$ 1,800,000	$ 1,800,000
Convertible Debentures, Fair Value	178,388,200,000	1,753,406	$ 1,050,000
Promissory Notes Payable, Carrying Amount	359,454	360,514
Promissory Notes Payable, Fair Value	$ 359,454	$ 360,514

XML

Financial Instruments (Details 1) - USD ($)	May 31, 2023	Nov. 30, 2022
Total Accounts Receivable	$ 333,582	$ 602
Less Allowance For Doubtful Accounts	0	0
Total Accounts Receivable, Net	333,582	602
Not Past Due	333,582	602
Accounts receivable	333,582	602
Total Accounts Receivable, Gross	333,582	602
Past due for more than 31 days but no more than 120 days
Past Due	0	0
Past due for more than 120 days
Past Due	$ 0	$ 0

XML

Financial Instruments (Details 2)	6 Months Ended
	May 31, 2023 USD ($)
Operating lease liabiity
Undiscounted Future Cash Flows	$ 91,782
Employee Costs Payable
Undiscounted Future Cash Flows	3,491,952
Convertible Debentures
Undiscounted Future Cash Flows	1,800,000
Promissory Notes Payable
Undiscounted Future Cash Flows	359,454
Total contractual obligations
Undiscounted Future Cash Flows	12,700,284
Accrued Liabilities
Undiscounted Future Cash Flows	3,284,320
Accounts Payable
Undiscounted Future Cash Flows	3,672,776
Less Than 3 Months
Undiscounted Future Cash Flows	12,654,393
Less Than 3 Months | Operating lease liabiity
Undiscounted Future Cash Flows	45,891
Less Than 3 Months | Employee Costs Payable
Undiscounted Future Cash Flows	3,491,952
Less Than 3 Months | Convertible Debentures
Undiscounted Future Cash Flows	1,800,000
Less Than 3 Months | Promissory Notes Payable
Undiscounted Future Cash Flows	359,454
Less Than 3 Months | Accrued Liabilities
Undiscounted Future Cash Flows	3,284,320
Less Than 3 Months | Accounts Payable
Undiscounted Future Cash Flows	3,672,776
Three To Six Months
Undiscounted Future Cash Flows	45,891
Three To Six Months | Operating lease liabiity
Undiscounted Future Cash Flows	45,891
Three To Six Months | Employee Costs Payable
Undiscounted Future Cash Flows	0
Three To Six Months | Convertible Debentures
Undiscounted Future Cash Flows	0
Three To Six Months | Promissory Notes Payable
Undiscounted Future Cash Flows	0
Three To Six Months | Accrued Liabilities
Undiscounted Future Cash Flows	0
Three To Six Months | Accounts Payable
Undiscounted Future Cash Flows	0
Six To Nine Months
Undiscounted Future Cash Flows	0
Six To Nine Months | Operating lease liabiity
Undiscounted Future Cash Flows	0
Six To Nine Months | Employee Costs Payable
Undiscounted Future Cash Flows	0
Six To Nine Months | Convertible Debentures
Undiscounted Future Cash Flows	0
Six To Nine Months | Promissory Notes Payable
Undiscounted Future Cash Flows	0
Six To Nine Months | Accrued Liabilities
Undiscounted Future Cash Flows	0
Six To Nine Months | Accounts Payable
Undiscounted Future Cash Flows	0
Nine Months To One Year
Undiscounted Future Cash Flows	0
Nine Months To One Year | Operating lease liabiity
Undiscounted Future Cash Flows	0
Nine Months To One Year | Employee Costs Payable
Undiscounted Future Cash Flows	0
Nine Months To One Year | Convertible Debentures
Undiscounted Future Cash Flows	0
Nine Months To One Year | Promissory Notes Payable
Undiscounted Future Cash Flows	0
Nine Months To One Year | Accrued Liabilities
Undiscounted Future Cash Flows	0
Nine Months To One Year | Accounts Payable
Undiscounted Future Cash Flows	0
Greater Than One Year
Undiscounted Future Cash Flows	0
Greater Than One Year | Operating lease liabiity
Undiscounted Future Cash Flows	0
Greater Than One Year | Employee Costs Payable
Undiscounted Future Cash Flows	0
Greater Than One Year | Convertible Debentures
Undiscounted Future Cash Flows	0
Greater Than One Year | Promissory Notes Payable
Undiscounted Future Cash Flows	0
Greater Than One Year | Accrued Liabilities
Undiscounted Future Cash Flows	0
Greater Than One Year | Accounts Payable
Undiscounted Future Cash Flows	$ 0

XML

Financial Instruments (Details Narrative) $ in Millions	6 Months Ended
	May 31, 2023 USD ($)
Financial Instruments
Foreign Exchange Risk Movement In Currency Percentage	10.00%
Foreign Exchange Risk Loss And Other Comprehensive Loss Amount Affected	$ 0.1

XML

Segmented Information (Details) - USD ($)	3 Months Ended		6 Months Ended
	May 31, 2023	May 31, 2022	May 31, 2023	May 31, 2022	Nov. 30, 2022
Revenue	$ 480,203	$ 0	$ 806,546	$ 16,978
Total assets	1,735,410		1,735,410		$ 1,432,032
Total property and equipment	706,760		706,760		788,051
United States [Member]
Revenue	806,546	$ 0	16,978	$ 16,978
Canada [Member]
Total assets	1,735,410		1,735,410		1,432,032
Total property and equipment	$ 706,760		$ 706,760		$ 788,050