~~Scottsdale, Arizona 85251~~____________________________________________________________

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

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of ~~April~~July 14, 2022, there were 20,020,239 shares of common stock outstanding.

This report includes forward-looking statements that relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Words such as, but not limited to, “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “targets,” “likely,” “aim,” “will,” “would,” “could,” and similar expressions or phrases identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and future events and financial trends that we believe may affect our financial condition, results of operation, business strategy and financial needs. Forward-looking statements include, but are not limited to, statements about risks associated with:

You should read thoroughly this report and the documents that we refer to herein with the understanding that our actual future results may be materially different from and/or worse than what we expect. We qualify all of our forward-looking statements by these cautionary statements including those made in Part I. Item 1A. Risk Factors appearing in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021 as filed with the Securities and Exchange Commission (the “SEC”) on December 10, ~~2021~~ ~~and our other filings with the SEC.~~2021. New risk factors emerge from time to time and it is not possible for our management to predict all risk factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Except for our ongoing obligations to disclose material information under the Federal securities laws, we undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events. These forward-looking statements speak only as of the date of this report, and you should not rely on these statements without also considering the risks and uncertainties associated with these statements and our business.

All references in this report to the “Company”, “Innovation1 Biotech Inc.”, “Innovation1”, “we”, “us,” or “our” are to Innovation1 Biotech Inc. (formerly “Gridiron BioNutrients, Inc.”), a Nevada corporation and our ~~wholly owned~~wholly-owned subsidiary Gridiron Ventures, Inc., a Nevada corporation.

All share and per share information gives proforma effect to the 308:1 reverse stock split of our common stock effective January 8, 2021.

		February 28, 2022			August 31, 2021				May 31, 2022			August 31, 2021
		(Unaudited)							(Unaudited)
ASSETS	ASSETS							ASSETS
Current assets:
Cash		$	1,310,285		$	137,476			$	636,159		$	137,476
Other receivable			179,770			0				56,421			0
Inventory			0			17,000				0			17,000
Prepaid expenses			30,300			14,000				127,826			14,000
Total current assets			1,520,355			168,476				820,406			168,476
Other assets
Equity investment, net of discount			0			11,132				0			11,132
Equipment, net			3,138			598				2,876			598
Trademarks			1,680			1,680				1,680			1,680
Intangibles			80,592,852			0				79,744,239			0
ROU Asset			585,390			0				533,738			0
Security Deposit			60,000			0				60,000			0
Total other assets			81,243,060			13,410				80,342,533			13,410
Total Assets		$	82,763,415		$	181,886			$	81,162,939		$	181,886
LIABILITIES AND STOCKHOLDERS’ EQUITY	LIABILITIES AND STOCKHOLDERS’ EQUITY							LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	101,593		$	41,874			$	133,578		$	41,874
Accrued expenses			12,514			2,056				35,555			2,056
Acquisition payments due to Ingenius, current portion			28,500,000			0				28,500,000			0
Related party payable			0			64,600				0			64,600
Lease liability, current portion			189,527			0				194,305			0
Note payable, current portion			10,000			160,000				10,000			160,000
Dividends payable			462,654			138,195				650,226			138,195
Total current liabilities			29,276,288			406,725				29,523,664			406,725
Long term liabilities:
Long-term liabilities:
Lease liability			400,504			0				350,099			0
Acquisition payments due to Ingenius			11,000,000			0				11,000,000			0
Total long term liabilities			11,400,504			0
Total long-term liabilities										11,350,099			0
Total liabilities			40,676,792			406,725				40,873,763			406,725
Commitments and contingencies (Note 10)
Stockholders’ equity (deficiency):
Preferred stock Series A, $0.001 par value; 22,305,486 shares authorized; -0- issued and outstanding as of February 28, 2022 and August 31, 2021			0			0
Preferred stock Series B, $0.001 par value; 2,695,514 shares authorized; 2,695,514 and 2,694,514 issued and outstanding as of February 28, 2022 and August 31, 2021, respectively			2,695			2,695
Preferred stock Series B-1, $0.001 par value; 5,389,028 shares authorized; 5,389,028 and 0 issued and outstanding as of February 28, 2022 and August 31, 2021, respectively			5,389			0
Common stock, $0.001 par value; 200,000,000 shares authorized; 20,020,239 and 188,616 shares issued and outstanding as of February 28, 2022 and August 31, 2021, respectively			20,020			188
Commitments and contingencies (Note 9)
Stockholders’ equity (deficit):

Preferred stock Series A, $0.001 par value; 22,305,486 shares authorized; 0 issued and outstanding as of May 31, 2022 and August 31, 2021										0			0

Preferred stock Series B, $0.001 par value; 2,695,514 shares authorized; 2,695,514 and 2,694,514 issued and outstanding as of May 31, 2022 and August 31, 2021, respectively										2,695			2,695

Preferred stock Series B-1, $0.001 par value; 5,389,028 shares authorized; 5,389,028 and 0 issued and outstanding as of May 31, 2022 and August 31, 2021, respectively										5,389			0

Common stock, $0.001 par value; 200,000,000 shares authorized; 20,020,239 and 188,616 shares issued and outstanding as of May 31, 2022 and August 31, 2021, respectively
Additional paid in capital			47,375,512			2,745,906				47,375,512			2,745,906
Accumulated deficit			(5,316,993	)		(2,973,628	)			(7,114,440	)		(2,973,628	)
Total stockholders’ equity (deficiency)			42,086,623			(224,839	)
Total Liabilities and Stockholders’ equity		$	82,763,415		$	181,886
Total stockholders’ equity (deficit)										40,289,176			(224,839	)

Total Liabilities and Stockholders’ equity (deficit)									$	81,162,939		$	181,886

The accompanying notes are an integral part of these ~~financial statements.~~

~~The common stock issued and outstanding for the~~condensed consolidated financial statements ~~presented have been retroactively adjusted to reflect the 1-for-308 reverse stock split, which was effective in January 2021.~~

	For the Six Months Ended						For the Three Months Ended						For the Three Months Ended						For the Nine Months Ended
	February 28, 2022			February 28, 2021			February 28, 2022			February 28, 2021			May 31, 2022			May 31, 2021			May 31, 2022			May 31, 2021
Revenue	$	-		$	3,080		$	0		$	0		$	0		$	0		$	0		$	3,080
Cost of Revenue		0			1,421			0			0			0			0			0			1,421

Gross margin		0			1,659			0			0			0			0			0			1,659

Operating expenses:
Advertising		207			365			51			156			3,631			156			3,838			521
Consulting fees		242,180			30,375			103,850			15,375			83,000			15,000			325,180			45,375
General and administrative		30,664			22,682			18,200			10,675			19,855			14,831			50,518			36,697
Professional fees		407,223			61,689			298,292			30,068			231,154			16,811			638,377			78,500
Salaries		580,112			0			478,921			0			357,212			0			937,324			0
Stock compensation expense		0			0			0			0
Depreciation and amortization expense		883,048			0			883,048			0
Depreciation expense														261			299			261			1,115
Amortization expense - ROU														51,652			0			86,087			0
Amortization expense – intangible assets														848,613			0			1,697,226			0
Total operating expenses		2,143,434			115,111			1,782,362			56,274			1,595,378			47,097			3,738,811			162,208

Net operating income (loss)		(2,143,434	)		(113,452	)		(1,782,362	)		(56,274	)		(1,595,378	)		(47,097	)		(3,738,811	)		(160,549	)

Other (income) expense:
Interest expense		15,469			76,886			10,330			40,136			14,498			28,338			29,967			105,224
Interest income		(13,638	)		(48,743	)		(13,638	)		(21,018	)		0			(6,825	)		(13,638	)		(55,567	)
Impairment expense		17,598			0			0			0			0			19,100			17,598			19,100
(Gain) loss on change in fair value of derivative liability		0			(572,701	)		0			(665,343	)		0			(881,779	)		0			(1,454,480	)
Interest accretion		0			114,599			0			34,088			0			0			0			114,599
Gain on extinguishment of debt		(143,956	)		0			0			0			0			0			(143,956	)		0
Other (income) expense		0			(4,174	)		0			(2,087	)		0			(2,087	)		0			(6,262	)
Gain (loss) on derivative financial instruments		0			0			0			0
Total Other (income) expense		(124,527	)		(434,133	)		(3,308	)		(614,224	)		14,498			(843,253	)		(110,029	)		(1,277,386	)

Net income (loss)		(2,018,907	)		320,681			(1,779,054	)		557,950			(1,609,876	)		796,156			(3,628,782	)		1,116,837

Preferred Dividends		(324,458	)		0			(87,571	)		0			(187,571	)		0			(512,030	)		0
Net income (loss) available to common shareholders	$	(2,343,365	)	$	320,681		$	(1,866,625	)	$	557,950		$	(1,797,447	)	$	796,156		$	(4,140,812	)	$	1,116,837

Basic income (loss) per share	$	(0.18	)	$	1.71		$	(0.09	)	$	2.97		$	(0.09	)	$	4.22		$	(0.27	)	$	5.94

Weighted average number of common
shares outstanding - basic		12,788,818			187,563			20,020,239			187,937			20,020,239			188,616			15,225,781			187,918

The accompanying notes are an integral part of these ~~financial statements.~~

	Preferred Stock - Series A				Preferred Stock - Series B				Preferred Stock - Series B1				Common Stock				Additional Paid-In			Accumulated			Total Stockholders’			Preferred Stock - Series A						Preferred Stock - Series B				Preferred Stock - Series B1				Common Stock				Additional Paid-In			Accumulated			Total Stockholders’ Equity
	Shares		Amount		Shares		Amount		Shares		Amount		Shares		Amount		Capital			Deficit			Equity (Deficit)			Shares			Amount			Shares		Amount		Shares		Amount		Shares		Amount		Capital			Deficit			(Deficit)
Balance at August 31, 2021		-	$	0		2,694,514	$	2,695		-	$	0		188,616	$	188	$	2,745,906		$	(2,973,628	)	$	(224,839	)		-		$	-			2,694,514	$	2,695		-	$	0		188,616	$	188	$	2,745,906		$	(2,973,628	)	$	(224,839	)
Series B-1 preferred stock purchase agreements		-		0		-		0		5,389,028		5,389		-		0		4,000,000			0			4,000,000			-			0			-		0		5,389,028		5,389		-		0		3,994,611			0			4,000,000
Common Stock issued for asset purchase		-		0		-		0		-		0		19,831,623		19,832		40,634,995			0			40,654,827			-			0			-		0		-		0		19,831,623		19,832		40,634,995			0			40,654,827
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(136,887	)		(136,887	)		-			0			-		0		-		0		-		0		0			(136,887	)		(136,887	)
Net loss, period ended November 30, 2021		-		0		-		0		-		0		-		0		0			(239,853	)		(239,853	)		-			0			-		0		-		0		-		0		0			(239,853	)		(239,853	)
Balance at November 30, 2021 (Unaudited)		-	$	0		2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,380,901		$	(3,350,368	)	$	44,053,248			-		$	0			2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,375,512		$	(3,350,368	)	$	44,053,248
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(187,571	)		(187,571	)		-			0			-		0		-		0		-		0		0			(187,571	)		(187,571	)
Net loss, period ended February 28, 2022		-		0		-		0		-		0		-		0		0			(1,779,054	)		(1,779,054	)		-			0			-		0		-		0		-		0		0			(1,779,054	)		(1,779,054	)
Balance at February 28, 2022 (Unaudited)																											-		$	0			2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,375,512		$	(5,316,993	)	$	42,086,623
Dividends on preferred stock accrued																											-			0			-		0		-		0		-		0		0			(187,571	)		(187,571	)
Net loss, period ended May 31, 2022																											-			0			-		0		-		0		-		0		0			(1,609,876	)		(1,609,876	)
Balance at May 31, 2022 (Unaudited)																											-		$	0			2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,375,512		$	(7,114,440	)	$	40,289,176

Balance at February 28, 2022 (Unaudited)		-	$	0		2,694,514	$	2,695		5,389,028	$	5,389		20,020,239	$	20,020	$	47,380,901		$	(5,316,993	)	$	42,086,623

Balance at August 30, 2020		8,480,000	$	8,480		-	$	0		-	$	0		187,194	$	187	$	1,157,253		$	(3,843,927	)	$	(2,678,007	)
Balance at August 31, 2020																											8,480,000		$	8,480			-	$	0		-	$	0		187,194	$	187	$	1,157,253		$	(3,843,927	)	$	(2,678,007	)
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(12,575	)		(12,575	)		-			0			-		0		-		0		-		0		0			(12,575	)		(12,575	)
Net loss, period ended November 30, 2020		-		0		-		0		-		0		-		0		0			(237,268	)		(237,268	)		-			0			-		0		-		0		-		0		0			(237,268	)		(237,268	)
Balance at November 30, 2020 (Unaudited)		8,480,000	$	8,480		-	$	0		-	$	0		60,247,911	$	60,247	$	1,157,253		$	(4,093,770	)	$	(2,927,850	)		8,480,000		$	8,480			-	$	0		-	$	0		187,194	$	187	$	1,157,253		$	(4,093,770	)	$	(2,927,850	)
Adjustment for reverse split		-		0		-		0		-		0		1,422		1		(1	)		0			0			-			0			-		0		-		0		1,422		1		(1	)		0			0
Dividends on preferred stock accrued		-		0		-		0		-		0		-		0		0			(12,575	)		(12,575	)		-			0			-		0		-		0		-		0		0			(12,575	)		(12,575	)
Net loss, period ended February 28, 2021		-		0		-		0		-		0		-		0		0			557,950			557,950			-			0			-		0		-		0		-		0		0			557,950			557,950
Balance at February 28, 2021 (Unaudited)		8,480,000	$	8,480		-	$	0		-	$	0		60,249,333	$	60,248	$	1,157,252		$	(3,548,395	)	$	(2,382,475	)		8,480,000		$	8,480			-	$	0		-	$	0		188,616	$	188	$	1,157,252		$	(3,548,395	)	$	(2,382,475	)
Exchange agreement																											(8,480,000	)		(8,480	)		2,694,514		2,695		-		0		-		0		1,588,654			0			1,582,869
Dividends on preferred stock accrued																											-			0			-		0		-		0		-		0		0			(38,649	)		(38,649	)
Net loss, period ended May 31, 2021																											-			0			-		0		-		0		-		0		0			796,156			796,156
Balance at May 31, 2021 (Unaudited)																											-		$	0			2,694,514	$	2,695		-	$	0		188,616	$	188	$	2,745,906		$	(2,790,888	)	$	(42,099	)

The accompanying notes are an integral part of these ~~financial statements.~~

	Six Months Ending						Nine Months Ending
	February 28, 2022			February 28, 2021			May 31, 2022			May 31, 2021

Cash flows from operating activities:
Net income (loss)	$	(2,018,907	)	$	320,681		$	(3,628,782	)	$	1,116,837
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		0			816			261			1,115
(Gain) Loss on change in fair value of derivative liability		0			(572,701	)		0			(1,454,480	)
Interest accretion		0			114,599			0			114,599
Amortization of ROU Asset		34,435			0			86,087			0
Amortization of Mioxal Asset		834,975			0			1,683,588			0
Impairment expense		17,598			0			17,598			20,100
Gain on extinguishment of debt		(143,956	)		0			(143,956	)		0
Realized income on investment		0			(4,174	)		0			(6,262	)
Changes in operating assets and liabilities:
Other receivable		(179,770	)		0			(56,421	)		0
Inventory		0			1,000
Prepaid expenses		(76,300	)		7,945			(173,826	)		10,945
Notes receivable		0			71,771			0			132,852
Accounts payable		(387,986	)		79,345			(401,627	)		103,485
Related party payable		(64,600	)		(11,869	)		(64,600	)		(25,869	)
Accrued expenses		10,458			0			33,499			0
Net cash provided by (used in) operating activities		(1,974,053	)		7,413			(2,648,179	)		13,321

Cash flows from investing activities:
Purchase of equipment		(3,138	)		0			(3,138	)		0
Cash paid for asset purchase		(350,000	)		0			(350,000	)		0
Notes receivable investment		(500,000	)		0			(500,000	)		0
Net cash used in investing activities		(853,138	)		0			(853,138	)		0

Cash flows from financing activities
Proceeds from Series B-1 preferred stock purchase agreements		4,000,000			0			4,000,000			0
Net cash provided by financing activities		4,000,000			0			4,000,000			0

Net increase (decrease) in cash		1,172,809			7,413			498,683			13,321
Cash - beginning of the period		137,476			17,881			137,476			17,881
Cash - end of the period	$	1,310,285		$	25,294		$	636,159		$	31,202

Supplemental disclosures:
Interest paid	$	10,207		$	0		$	24,579		$	0
Non-cash transactions:
Preferred stock dividends accrued	$	324,458		$	25,150		$	312,029		$	63,799
Right of Use Asset and Lease liability recognition at inception	$	619,825					$	619,825
Common Stock issued for asset purchase	$	40,654,827		$	0		$	40,654,827		$	0

The accompanying notes are an integral part of these ~~financial statements.~~

~~Gridiron Bionutrients,~~Innovation1 Biotech Inc. (the “Company”) was formed under the laws of the state of Nevada on July 20, 2017, under the name of Gridiron BioNutrients, Inc. to develop and distribute a retail line of health water infused with probiotics and minerals.

Effective March 31, 2022, as approved by the shareholders, the name of the Company was changed from Gridiron ~~Bionutrients,~~BioNutrients, Inc. (trading symbol GVMP) to Innovation1 Biotech Inc. (trading symbol IVBT).

The Company is currently developing products using five proprietary preclinical prodrugs, all fully synthetic without connection to botanical sourcing: a mushroom-derived psychedelic molecule for treatment post-traumatic stress disorder and depression, a novel cannabinoid and tree bark derived psychedelic for treatment of addiction and three additional novel cannabinoid prodrugs addressing clinical indications of refractory epilepsy, burn wounds and uveitis.

The Company also owns a currently patented nutraceutical complex specially designed and formulated to contribute and help maintain normal energy metabolism, improve mood and reduce fatigue for those suffering from fibromyalgia and chronic fatigue syndrome.

On December 22, 2020, the Company filed Articles of Amendment to its Articles of Incorporation, as amended, which were effective on January 8, 2021 (the “Effective Date”), which effected a three hundred eight for one (308:1) reverse stock split of its outstanding common stock. Previously, on December 4, 2020 the Company filed a definitive Information Statement on Schedule 14C with the SEC notifying its stockholders that on December 2, 2020, the holders of a majority of its outstanding shares of common stock and the shares Series A Convertible Preferred Stock who were entitled to consent to the action, voting as a single class, executed a written consent in lieu of a special meeting of stockholders approving a reverse stock split of the Company’s outstanding common stock of not less than 300:1 and not more than 310:1, with the Company’s Board of Directors having the discretion as to when such reverse stock split would be effected (on or prior to December 2, 2021) and the exact ratio of the reverse stock split to be set at a whole number within the above range as determined by the board of directors in its sole discretion. On December 17, 2020, in accordance with such authority, the Board of Directors fixed the exact ratio of the reverse stock split.

On November 5, 2021, the Company completed the asset acquisition of ST BioSciences, Ltd., consisting substantially of intellectual property assets, relating to Mioxal® as discussed in Note 3 – Asset Acquisition. The closing of the acquisition resulted in a change of control of the Company. As part of the acquisition, Mr. Orr stepped down as the Company’s Chief Executive Officer and assumed the role of the Company’s Chief Financial Officer. Mr. Orr has since resigned from his position and as a director. Pursuant to the terms of the Asset Purchase Agreement, Jeffrey J. Kraws was appointed as the Company’s Chief Executive Officer and a director of the Company. In addition, the Company agreed to appoint Jason Frankovich as a director of the Company subject to the Company’s compliance with Rule 14F-1 of the Exchange Act.

The Company’s financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company had 0no revenue and a net operating loss of ~~$2,143,434~~$3,738,811 for the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The Company has working capital deficit of ~~$27,755,933~~$28,703,258 and an accumulated deficit of ~~$5,316,993~~$7,114,440 as of ~~February 28,~~May 31, 2022. These conditions raise substantial doubt about the Company’s ability to continue as a going concern for the twelve months after the issuance of this financial statement. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The ability of the Company to fully commence its operations is dependent upon, among other things, obtaining additional financing to continue operations and execution of its business plan. In response to these concerns, management plans to fund operations through additional debt and equity financing. Debt instruments may be convertible or non-convertible and will vary based on the Company’s needs and financing options available at such times. There can be no assurance that management’s plan will be successful.

This summary of accounting policies for Innovation1 is presented to assist in understanding the Company’s financial statements. The Company uses the accrual basis of accounting and accounting principles generally accepted in the United States of America (“US GAAP” ~~accounting) and~~), which have been consistently applied in the preparation of the financial statements.

The accompanying unaudited financial information as of and for the three and the nine months ended May 31, 2022 and 2021 has been prepared in accordance with GAAP in the U.S. for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, such financial information includes all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation of our financial position at such date and the operating results and cash flows for such periods. Operating results for the three and nine months ended May 31, 2022 are not necessarily indicative of the results that may be expected for the entire year or for any other subsequent interim period.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to the rules of the U.S. Securities and Exchange Commission, or the SEC. These unaudited financial statements and related notes should be read in conjunction with our audited financial statements for the year ended August 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC on December 10, 2021.

The condensed consolidated balance sheet at August 31, 2021 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by generally accepted accounting principles in the U.S. for complete financial statements.

The consolidated financial statements represent the results of Innovation1 Biotech, Inc, its ~~wholly owned~~wholly-owned subsidiary, Gridiron Ventures and the assets, processes, and results therefrom. All intercompany transactions and balances have been eliminated. All financial information has been prepared in conformity with ~~accounting principles generally accepted in the United States of America.~~US GAAP.

Certain prior year amounts have been reclassified for comparative purposes to conform to the current-year financial statement presentation. These reclassifications had no effect on previously reported results.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements. Actual results could differ from those estimates. Estimates are used when accounting for fair value calculations, including those related to embedded conversion features of outstanding convertible notes payable.

The Company considers all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents to the extent the funds are not being held for investment purposes. The Company ~~had $1,310,285 and $137,476 of cash as of February 28, 2022 and August 31, 2021, respectively. The Company~~ did 0tnot have any cash equivalents as of ~~February 28,~~May 31, 2022 and August 31, 2021.

The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (FDIC) up to $250,000. As of February 28, 2022, the Company’s cash balance exceeded FDIC coverage. As of August 31, 2021, the Company’s cash balance did not exceed FDIC coverage. The Company has not experienced any losses in such accounts and periodically evaluates the credit worthiness of the financial institutions and has determined the credit exposure to be negligible.

Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration that an entity expects to receive in exchange for those goods or services. In addition, the standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The amount of revenue that is recorded reflects the consideration that the Company expects to receive in exchange for those goods. The Company applies the following five-step model in order to determine this amount: (i) identification of the promised goods in the contract; (ii) determination of whether the promised goods are performance obligations, including whether they are distinct in the context of the contract; (iii) measurement of the transaction price, including the constraint on variable consideration; (iv) allocation of the transaction price to the performance obligations; and (v) recognition of revenue when (or as) the Company satisfies each performance obligation.

Once a contract is determined to be within the scope of ASC 606 at contract inception, the Company reviews the contract to determine which performance obligations the Company must deliver and which of these performance obligations are distinct. The Company recognizes as revenues the amount of the transaction price that is allocated to the respective performance obligation when the performance obligation is satisfied or as it is satisfied. Generally, the Company’s performance obligations are transferred to customers at a point in time, typically upon delivery.

Fair value of certain of the Company’s financial instruments including cash, prepaid expenses, accounts payable, accrued expenses, notes payable, and other accrued liabilities approximate cost because of their short maturities. The Company measures and reports fair value in accordance with ASC 820, “Fair Value Measurements and Disclosure” defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles and expands disclosures about fair value investments.

Fair value, as defined in ASC 820, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of an asset should reflect its highest and best use by market participants, principal (or most advantageous) markets, and an in-use or an in-exchange valuation premise. The fair value of a liability should reflect the risk of nonperformance, which includes, among other things, the Company’s credit risk.

Valuation techniques are generally classified into three categories: the market approach; the income approach; and the cost approach. The selection and application of one or more of the techniques may require significant judgment and are primarily dependent upon the characteristics of the asset or liability, and the quality and availability of inputs. Valuation techniques used to measure fair value under ASC 820 must maximize the use of observable inputs and minimize the use of unobservable inputs. ASC 820 also provides fair value hierarchy for inputs and resulting measurement as follows:

Level 1: Quoted prices (unadjusted) in active markets that are accessible at the measurement date for identical assets or liabilities.

Level 2: Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities; and

Level 3: Unobservable inputs for the asset or liability that are supported by little or no market activity, and that are significant to the fair values.

Fair value measurements are required to be disclosed by the Level within the fair value hierarchy in which the fair value measurements in their entirety fall. Fair value measurements using significant unobservable inputs (in Level 3 measurements) are subject to expanded disclosure requirements including a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (i) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings, and a description of where those gains or losses included in earning are reported in the statement of income.

The Company did not ~~identify~~have any Level 1, Level 2 or Level 3 assets orand liabilities ~~that are required to be presented on the balance sheet~~ at ~~fair value in accordance with ASC 825-10 as of February 28,~~May 31, 2022 and August 31, 2021.

Accounts receivable balances are established for amounts owed to the Company from its customers from the sale of products. The Company closely monitors the collectability of outstanding accounts receivable and provide an allowance for doubtful accounts based on estimated collections of outstanding amounts. The Company evaluated the accounts and other receivable and determined no collection loss reserve was necessary. There were $-0- accounts receivable as of February 28, 2022 and August 31, 2021, respectively.

During the ~~six~~nine months ended ~~February 28,~~May 31, 2022, the Company discovered duplicate withdrawals from its payroll processing company and has recorded ~~an other~~a receivable on its condensed consolidated balance sheet at ~~February 28,~~May 31, 2022. There were ~~$179,770~~$56,421 and ~~$-0-~~$0 outstanding other receivable as of ~~February 28,~~May 31, 2022 and August 31, ~~2021, respectively.~~

Inventories consist of raw materials and T-free distillate and are stated at the lower of cost or net realizable value using the first‑in, first‑out method. The Company periodically assesses the recoverability of its inventory and reduces the carrying value of the inventory when items are determined to be obsolete, defective or in excess of forecasted sales requirements. Inventory write‑downs for excess, defective and obsolete inventory are recorded as impairment expense in the accompanying statement of operations. The Company wrote-off $-0- of obsolete inventory or inventory below market value for the for the three months ended February 28, 2022 and 2021, respectively, and $17,000 and $-0- for the six months ended February 28, 2022 and 2021, respectively.

Trademark costs are capitalized as incurred to the extent the Company expects the costs incurred to result in a trademark being awarded. The trademarks are deemed to have an indefinite life and are reviewed for impairment loss considerations annually. As of ~~February 28,~~May 31, 2022 and August 31, 2021, the Company had trademarks totaling $1,680.

Property and equipment are carried at cost. Expenditures for maintenance and repairs are expensed in the period incurred. Renewals and betterments that materially extend the life of the assets are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in income for the period.

Depreciation is computed for financial statement purposes on a straight-line basis over estimated useful lives of the related assets and the modified accelerated cost recovery system for federal income tax purposes. The estimated useful lives of depreciable ~~assets are:~~computers and other equipment are three years.

With the asset acquisition as discussed in Note 3 – Asset Acquisition the Company wrote off the remaining property and equipment as impaired in the accompanying statement of operations. Depreciation expense was ~~$-0-~~$261 and ~~$387~~$299 for the three months ended ~~February 28,~~May 31, 2022 and 2021, respectively, and ~~$-0-~~$261 and ~~$816~~$1,115 for the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and. 2021, respectively.

Operating lease right of use (“ROU”) assets represent the right to use the leased asset for the lease term and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most leases do not provide an implicit rate, the Company uses ~~and~~an incremental borrowing rate based on the information available at the adoption date in determining the present value of future payments. Lease expense for minimum lease payments is amortized on a straight-line basis over the lease term and is included in general and administrative expenses in the consolidated statements of operations.

The Company follows the asset and liability method of accounting for income taxes under ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that included the enactment date. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Use of net operating loss carry forwards for income tax purposes may be limited by Internal Revenue Code section 382 if a change of ownership occurs.

ASC 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more likely than not to be sustained upon examination by taxing authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of February 28, 2022 and August 31, 2021. The Company is currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position. The Company is subject to income tax examinations by major taxing authorities since inception.

Basic income (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity.

The Series B and Series B1 Convertible Preferred shares would convert to 8,083,542 shares of the Company’s common stock in addition to the 20,020,239 outstanding shares at ~~February 28,~~May 31, 2022. The Series B Convertible Preferred shares would convert to 22,694,514 shares of the Company’s common stock in addition to the 188,616 outstanding shares at May 31, 2021. The Company calculates diluted earnings per share by dividing the Company’s net income available to common shareholders less preferred dividends by the diluted weighted average number of shares outstanding during the period. The conversion of the Company’s Series B and Series B1 Convertible Preferred shares are excluded from the computation of diluted earnings per share as they are anti-dilutive due to the Company’s operating losses for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021.

The Company’s policy regarding advertising is to expense advertising when incurred. The Company incurred advertising costs totaling ~~$51~~$3,631 and $156 during the three months ended ~~February 28,~~May 31, 2022 and 2021, respectively, and ~~$207~~$3,838 and ~~$365~~$521 during the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021 respectively.

The Company accounts for share-based compensation in accordance with the fair value recognition provisions of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) No. 718. The Company issues restricted stock to employees and consultants for their services. Cost for these transactions are measured at the fair value of the equity instruments issued at the date of grant. These shares are considered fully vested and the fair market value is recognized as expense in the period granted. The Company recognized consulting expenses and a corresponding increase to additional paid-in-capital related to stock issued for services. For agreements requiring future services, the consulting expense is to be recognized ratably over the requisite service period.

~~There was $-0- stock-based compensation during three and six months ended February 28, 2022 and 2021.~~

~~The Company follows subtopic ASC 850-10 for the identification of related parties and disclosure of related party transactions.~~

Pursuant to ASC 850-10-20 the related parties include (a) affiliates of the Company; (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of ASC 825–10–15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; (e) management of the Company; (f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

The financial statements shall include disclosures of material related party transactions, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: (a) the nature of the relationship(s) involved; (b) description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which income statements are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; (c) the dollar amounts of transactions for each of the periods for which income statements are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and (d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

~~In December 2019, the FASB issued ASU 2019-12,~~ ~~Simplifying the Accounting for Income Taxes~~, as part of its Simplification Initiative to reduce the cost and complexity in accounting for income taxes. ASU 2019-12 removes certain exceptions related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 also amends other aspects of the guidance to help simplify and promote consistent application of GAAP. The guidance is effective for interim and annual periods beginning after December 15, 2020, with early adoption permitted. The update had no material impact on the consolidated financial statements.

In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock. For convertible instruments with conversion features that are not required to be accounted for as derivatives under Topic 815, Derivatives and Hedging, or that do not result in substantial premiums accounted for as paid-in capital, the embedded conversion features no longer are separated from the host contract. ASU 2020-06 also removes certain conditions that should be considered in the derivatives scope exception evaluation under Subtopic 815-40, Derivatives and Hedging—Contracts in Entity’s Own Equity, and clarify the scope and certain requirements under Subtopic 815-40. In addition, ASU 2020-06 improves the guidance related to the disclosures and earnings-per-share (EPS) for convertible instruments and contract in entity’s own equity. ASU 2020-06 is effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Board specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. ~~The Company is currently evaluating the impact~~Implementation of this ASU ~~will have~~had no material impact on ~~its~~the consolidated financial statements.

As of ~~February 28,~~May 31, 2022, there were several new accounting pronouncements issued by the Financial Accounting Standards Board. Each of these pronouncements, as applicable, has been or will be adopted by the Company. Management does not believe the adoption of any of these accounting pronouncements has had or will have a material impact on the Company’s ~~consolidated financial statements.~~

The Company evaluates events that have occurred after the balance sheet date of February 28, 2022, through the date which the consolidated financial statements were issued. Based upon the review, other than described in ~~Note 12 – Subsequent Events~~~~, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the~~ consolidated financial statements.

On October 27, 2021, the Company entered into an asset acquisition agreement with ST BioSciences, Ltd., a company organized under the laws of England and Wales (“STB”), of certain Transferred Assets, consisting substantially of their intellectual property relating to Mioxal®, a nutraceutical complex composed of essential amino acids, natural coenzymes and minerals. The Company acquired certain intellectual property, and patent rights, and no tangible assets, ~~as well as the~~assumed certain liabilities ~~being acquired was~~ related to the acquisition of Mioxal by STB, as discussed below, and some outstanding employee payments. The acquisition was completed pursuant to the terms of the Amended and Restated Asset Purchase Agreement dated November 5, 2021. As consideration for the acquisition, the Company paid $850,000 in cash and issued 19,831,623 shares of Common Stock to STB valued at $40,654,827 or $2.05 per share based on the closing market price on November 5, 2021, which at the closing of the acquisition represented approximately 70% of the Company’s outstanding shares of Common Stock on a fully diluted basis, for an aggregate purchase price of $41,504,827, resulting in a change in control of the Company. The shares were issued ~~to a director of the Company and former director of STB who joined the Company~~ in December 2021.

The Mioxal® intellectual property, including the patent rights, was acquired by STB from Ingenius Biotech S.L, a Spanish corporation (“Ingenius”) on September 10, 2021. The Ingenius milestone and stock payments set forth in the Purchase Agreement between Ingenius and STB, were assumed by the Company in aggregate of $39,500,000 and are recorded in current and long-term liabilities in the accompanying consolidated balance sheets. ~~Upon meeting the milestones, the~~The first installment of $1,500,000 was due on January 15, 2022, the second installment of $1,500,000 on April 15, 2022 and a $3,500,000 ~~thereafter for each~~payment was due within thirty business days following the occurrence of the milestone ~~event for an aggregate of $24,500,000 to be paid in cash.~~event. The milestone, ~~being~~ a signed sales agreement with a third party to distribute Mioxal throughout ~~Europe.~~Europe, was not reached and therefore the requirement for the milestone payment was forfeited and will never be owed. In addition, ~~the remaining~~ $15,000,000 will be paid through the issuance of the Company’s common ~~stock. Ingenius is to receive~~stock in three tranches ~~of the Company’s common stock~~ beginning twelve months from execution of agreement with STB on September 10, 2021, as follows:

~~In addition, until the $39,500,000~~The remaining balance is to be paid ~~in cash and the Company’s common stock,~~on an earn-out basis whereunder Ingenius will earn an 8% royalty on all sales generated by Mioxal®. until the balance is satisfied.

On January 13, 2022, the Company entered into Amendment No. 1 to Purchase Agreement with Ingenius Biotech S.L. to modify the terms of the agreement dated September 10, 2021. Under the amended agreement, the first installment of $1,500,000 is now due on June 30, 2022, with an additional extension of the due date to August 30, 2022, and the second installment is now due on December 31, 2022.

The assets and liabilities assumed have been ~~valuated~~recorded at the fair values as follows:

The Mioxal® asset has a 24-year life and will be tested for impairment on an annual basis. During the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022, amortization of $846,494 and $1,692,989 was expensed. The other intangible assets for $178,000 have a 21-year life. During the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022, amortization of $2,119 and $4,238 was expensed.

On April 9, 2021 Company entered into an Exchange Agreement with Calvary Fund Management, LLC (“Calvary”) pursuant to which it agreed to issue Calvary 2,694,514 shares of its newly designated Series B Convertible Preferred Stock (the “Series B Preferred”) in exchange (the “Exchange”) for (i) 8,480,000 shares of its Series A Convertible Preferred Stock (the “Series A Preferred”), (ii) outstanding common stock purchase warrants (the “Warrants”), and (iii) all principal and accrued interest due under outstanding convertible promissory notes held by Calvary (the “Convertible Notes”, and together with the Series A Preferred and the Warrants, the “Calvary Securities”). The closing of the Exchange (the “Closing”) occurred following the satisfaction or waiver of the conditions set forth in the Exchange Agreement. On the Closing date, subject to the terms and conditions of the Exchange Agreement, the Company issued the Series B Preferred to Calvary in exchange for the Calvary Securities (which will be cancelled and retired) in a transaction exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) in reliance on exemptions provided pursuant to Section 3(a)(9) of the Securities Act.

The Series B Preferred Designations designated 2,694,514 shares of the Company’s blank check preferred stock as Series B Preferred Stock. In addition to rights granted to holders of Series B Preferred Stock under the Nevada Revised Statues, each holder will be entitled to the whole number of votes equal to the number of shares of common stock into which such holder’s Series B Preferred Stock would be convertible on the record date for the vote or consent of stockholders and shall otherwise have voting rights and powers equal to the voting rights and powers of the common stock. Once issued, the shares of Series B Preferred Stock are transferrable by the holder in the holder’s sole option without the consent of the Company, subject to compliance with Section 5 of the Securities Act.

The Series B Preferred Stock will rank senior to all other classes of the Company’s capital stock and has a stated value of $1.30 per share (the “Stated Value”). Subject only to the liquidation rights of the holders of Series B Preferred Stock that is then currently issued and outstanding, upon the liquidation, dissolution or winding up of the business of the Company, whether voluntary or involuntary, the Series B Preferred Stock is entitled to receive an amount per share equal to the Stated Value and then receive a pro-rata portion of the remaining assets available for distribution to the holders of common stock on an as-converted to common stock basis.

From and after the Closing date, cumulative dividends on each share of Series B Preferred Stock will accrue, on a quarterly basis in arrears, at the rate of 10% per annum on the Stated Value, plus all dividends, whether declared or not, on such share of Series B Preferred Stock (the “Additional Amount”) thereon. All accrued dividends on each share of Series B Preferred Stock are to be paid upon conversion of the Series B Preferred Stock for which the applicable dividend is due. At the option of the Company dividends may be paid in cash or shares of common stock. Each holder of Series B Preferred Stock will also be entitled to receive dividends or distributions on each share of Series B Preferred Stock on an “as converted” into common stock basis when and if dividends are declared on the common stock by the Company’s Board of Directors. Dividends may be paid in cash or property, as determined by the Board of Directors.

Subject to the beneficial ownership limitations described below, at any time after the Closing date, each share of Series B Preferred Stock will be convertible at the holder’s option into validly issued, fully paid and non-assessable shares of common stock at a conversion rate (the “Conversion Rate”) determined by dividing the Conversion Amount of such share of Series B Preferred Stock by the conversion price, which is (i) $1.30 or (ii) 75% of the price paid per share by investors in any subsequent offering of the Company’s common stock or common stock equivalents, subject to adjustment as provided herein, subject to adjustment as set forth below (the “Conversion Price”). The Conversion Amount is defined as the Stated Value plus the Additional Amount and any accrued and unpaid late charges with respect to such Stated Value and Additional Amount as of such date of determination. In addition, the shares of Series B Preferred Stock will be convertible at the holder’s option at the Conversion Price any time during the period commencing on the date of the occurrence of a Triggering Event (as defined in the Series B Preferred Designations). A holder of Series B Preferred Stock will not be able to convert the shares into shares of common stock to the extent such conversion or exercise would cause the holder, together with its affiliates, to beneficially own a number of shares of common stock which would exceed 4.99% of the Company’s then outstanding shares of our common stock following such exercise or conversion, subject to a waiver by the holder upon 61 days’ prior notice to the Company.

The Conversion Price and the number of shares of common stock issuable upon conversion of the Series B Preferred Stock will be subject to pro-rata adjustment for stock splits, dividends and similar corporate events. In addition, if on or after April 9, 2021, the execution date of the Exchange Agreement, the Company issues or sells, or is deemed to have issued or sold, any shares of common stock, excluding certain specified excluded securities for a consideration per share (the “New Issuance Price”) less than a price equal to the Conversion Price in effect immediately prior to such issue or sale or deemed issuance or sale, then, immediately after such dilutive issuance, the Conversion Price then in effect shall be reduced to the New Issuance Price.

The Series B Preferred Designations or any provision hereof (other than the beneficial ownership limitation set forth above) may be modified or amended or the provisions hereof waived with the written consent of the Company and either (i) the holders of a majority of the Series B Preferred Stock then currently outstanding, which must include Cavalry as long as Cavalry (or any of its affiliates) owns at least 5% of the Series B Preferred Stock issued pursuant to the Exchange Agreement, or (ii) Cavalry as long as Cavalry (or any of its affiliates) owns at least 5% of the Series B Preferred Stock issued pursuant to the Exchange Agreement.

On April 15, 2021, the date of the exchange, the Company exchanged 2,694,514 shares of the Company’s Series B Preferred Stock for the principal and interest on four convertible notes payable for $1,477,437, dividends payable on the Series A preferred stock of $105,432 and the Series A preferred stock for $1,006,000 for an aggregate of $2,588,869.

On April 27, 2020, under the Libertas Participation Agreement, the Company received 45,053 Warrants of QSI Holding Company, a private company, (“~~QSI~~QSI” and “QSI Warrants”) to purchase common stock priced at $3.111 per share for common stock par value $0.00001 expiring the 7th anniversary after the issue date. Upon issuance, the Company valued the warrants using the Black Scholes model yielding a total value of $58,443. The Company used the following assumptions upon measurement: QSI Holding Company value per common share of $3.4520, a life of 7 years, an exercise price of $3.111, a risk-free rate of 0.56% and volatility of 32%. In addition, the Company recorded a discount of $58,443 and will record income over the 7-year life of the warrants. On November 8, 2021, the Company entered into a Warrant Assignment Agreement to assign the QSI Warrants ~~issued on April 29, 2020 from QSI Holding Company, Inc. (“QSI”),~~ to Calvary Fund 1 LP (“Calvary”). In consideration of the assignment of the Warrant, Calvary forgave the ~~Company from the~~ principal and interest ~~owing~~owed by the Company under the Calvary $150,000 promissory note dated August 30, ~~2021 (See~~ ~~Note 4 Exchange Agreement~~).2021. The warrants are recorded as an equity investment in the accompanying consolidated balance sheets for ~~$-0-~~$0 and $11,132 at ~~February 28,~~May 31, 2022 and August 31, 2021, respectively. The Company recorded other income of ~~$-0-~~$0 and $2,087, respectively for the three months ended ~~February 28,~~May 31, 2022 and 2021, respectively, and ~~$-0-~~$0 and ~~$4,174~~$6,262 for the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021, respectively, in the accompanying condensed consolidated statement of operations.

On September 14, 2017, the Company issued a $10,000 promissory note to a limited liability company. The loan bears interest at 5% and ~~has~~had a maturity date of September 15, 2018. The unpaid balance including accrued interest was ~~$12,230~~$12,356 and ~~$11,730~~$11,856 at ~~February 28,~~May 31, 2022 and 2021, respectively. The Company is in default with the repayment terms of the note. Interest of ~~$123~~$126 was expensed during the three months ended ~~February 28,~~May 31, 2022 and 2021. Interest of ~~$248~~$374 was expensed during the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021.

On August 30, 2021, the Company issued a $150,000 promissory note to Calvary. The loan bears interest at 18% and has a maturity date of August 30, 2022. On November 8, 2021, the Company entered into a Warrant Assignment Agreement to assign the QSI Holding Company, Inc. (“QSI”) Warrants issued on April 29, 2020 from QSI to the Company, to Calvary. In consideration of the assignment of the Warrant, Calvary forgave the Company from the principal and interest owing under the Calvary $150,000 promissory note dated August 30, 2021 to fully satisfy the principal and interest owed under the promissory note. The unpaid principal and interest on the date of the assignment of the Warrant to Calvary was $155,088. Investments were reduced by $11,132 and the Company recorded a gain on debt extinguishment of $143,956 in the accompanying consolidated statement of operations. The unpaid balance including accrued interest was ~~$-0-~~$0 and $150,074 at ~~February 28,~~May 31, 2022 and August 31, 2021, respectively.

~~As discussed on~~ ~~Note 4 – Exchange Agreement~~, the Company exchanged the convertible notes payable for Series B Preferred Stock. As a result of the Exchange agreement, the convertible notes payable and accrued interest were reduced to $-0- in the accompanying consolidated balance sheets.

On August 27, 2019, the Company signed a convertible promissory note with an investor. The $30,000 note was issued with an original issue discount of $3,000 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 25% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on February 27, 2020. The note has a prepayment penalty of 110% of the principal and interest outstanding if repaid before 180 days from issuance. After February 27, 2020, the payment premium increases to 125% of the principal and interest outstanding and if in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note.

On November 25, 2019, the Company signed a convertible promissory note with an investor. The $140,000 note was issued with an original issue discount of $14,000 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on May 25, 2020. The note has a prepayment penalty of 110% of the principal and interest outstanding if repaid before 180 days from issuance. If in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note.

On January 27, 2020, the Company signed a convertible promissory note with an investor. The $555,000 note was issued with an original issue discount of $55,500 and bears interest at 10% per year. The note principal and interest are convertible into shares of common stock at a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on July 27, 2020. The note has a prepayment penalty of 115% of the principal and interest outstanding if repaid more than 30 days after note issuance. If in default, the payment premium increases to 140% of the principal and interest outstanding. The original issue discount is amortized through the term of the note.

On April 27, 2020, the Company signed a convertible promissory note with an investor. The $259,615 note was issued with an original issue discount of $57,115 and bears interest at -0-% per year. The Company recorded the self-amortizing convertible promissory note using the effective interest rate method to calculate the loan payable at $202,500 and accrued interest at $57,115. The note requires nine equal payments due starting June 15, 2020 for $28,846. In the event the Company fails to make the $28,846 installment payment by the 15th day of each designated month and/or fails to cure any missed installment payment within five (5) calendars days following the due date, or the Company defaults, the defaulted amount owed shall be 130% of the total outstanding balance owed by the Company. The default interest rate for missing an installment payment shall be 18% and the conversion into common stock shall be at a price of $0.02 per common stock. The note principal and interest are convertible into shares of common stock at the lower of $0.02 per share or a 35% discount to the lowest traded price of the Company’s common stock during the 10 prior trading days including the day the notice of conversion is received by the Company. The note matured on February 21, 2021. The Company made the first payment on June 15, 2020 for $28,846 and a partial payment of $10,000 on July 15, 2020. The original issue discount is amortized through the term of the note.

The conversion features meet the definition of a derivative liability instrument because the conversion rate is variable and therefore does not meet the “fixed-for-fixed” criteria outlined in ASC 815-40-15. As a result, the conversion features of the notes are recorded as a derivative liability at fair value and marked-to-market each period with the changes in fair value each period charged or credited to other income (expense). See ~~Note 11 - Derivative Liability~~~~, for a further discussion.~~31, 2022 (Unaudited)

As of ~~February 28,~~May 31, 2022, and August 31, 2021, the Company owed ~~$-0-~~$0 and $64,600, respectively to our former President and Director. The balance due is recorded as related party payable in the accompanying condensed consolidated balance sheets.

On January 1, 2022, we adopted ASC Topic 842 – Leases. Under this new guidance, lessees are required to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases. Upon adoption, we recognized operating lease right-of-use (“ROU”) assets and corresponding lease liabilities of $619,825.

We determine if an arrangement is or contains a lease at inception. Our assessment is based on (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period and (3) whether we have the right to direct the use of the asset. Leases are classified as either finance leases or operating leases. A lease is classified as a finance lease if any one of the following criteria are met: the lease transfers ownership of the asset by the end of the lease term, the lease contains an option to purchase the asset that is ~~reasonable~~reasonably certain to be exercised, the lease term is for the majority of the remaining useful life of the asset or the present value of the lease payments equals or exceeds substantially all of the fair value of the asset. A lease is classified as an operating lease if it does not meet any one of these criteria. The lease classification affects the expense recognition in the income statement. Operating lease costs are recorded entirely in operating expenses. Finance lease costs are split, where amortization of the ROU asset is recorded in operating expenses and an implied interest component is recorded in interest expense.

Under the guidance of ASC 842, operating leases are included in right-of-use assets, current lease liabilities, and noncurrent lease liabilities on our balance sheets. ROU assets and lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. As most of our leases do not provide an implicit interest rate, we use our incremental borrowing rate based on the information available at transition date in determining the present value of future payments. The ROU asset includes any lease payments made but excludes lease incentives and initial direct costs incurred, if any. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

Many leases have options to either extend or terminate the lease. In determining the lease term, we considered all available contract extensions that are reasonably certain of occurring.

On January 1, 2022, the Company entered into an operating lease for office space. The lease is effective for 3 years from the commencement date with automatic renewal at the expiration date. The lease agreement may be terminated earlier upon ninety days’ prior written notice by either party. The lease requires adjustment upon renewal with an increase to the monthly rent by 10% of the monthly rent due for the month preceding such renewal date or market rate, whichever is the greater amount.

The following table summarizes balance sheet data related to leases at ~~February 28,~~May 31, 2022 and August 31, 2021:

	February 28, 2022			August 31, 2021		May 31, 2022			August 31, 2021
Assets
Operating lease right of use assets	$	619,825		$	0	$	619,825		$	0
Less accumulated depreciation		(34,435	)		0		(86,087	)		0
Total operating lease right of use assets	$	585,390		$	0	$	533,738		$	0

Liabilities
Operating lease liability, current		189,527			0	$	194,305		$	0
Operating lease liability, noncurrent		400,504			0		350,099			0
Total lease liabilities		590,031			0	$	544,404		$	0

Operating lease liability is presented net of lease payments. The Company is required to make monthly payments of $20,000. During the ~~six~~nine months ended ~~February 28,~~May 31, 2022, the Company paid ~~$29,793~~$75,421 towards the lease liability and ~~$10,207~~$24,579 in interest expense.

During the year ended August 31, 2018, the Company issued Series A Convertible Preferred Stock, which accrues dividends at a rate of 5% annually. ~~As discussed on~~ ~~Note 4 – Exchange Agreement~~~~, the~~The Company exchanged the Series A Convertible Preferred for Series B Preferred Stock. As a result of the Exchange agreement, the dividends on the Series A Convertible Preferred Stock was reduced to ~~$-0-~~$0 in the accompanying consolidated balance sheets. The Series B and Series B1 Convertible Preferred Stock accrues dividends at a rate of 10% annually. There was ~~$362,654~~$650,226 and $138,195 of dividends payable at ~~February 28,~~May 31, 2022 and August 31, 2021, respectively. The dividends have not been declared and are accrued in the accompanying condensed consolidated balance sheets as a result of a contractual obligation in the Company’s Series B and Series B1 Preferred Stock offering.

There were ~~-0-~~no shares of Series A Convertible Preferred Stock issued and outstanding as of ~~February 28,~~May 31, 2022 and August 31, 2021.

~~As discussed on~~ ~~Note 4 – Exchange Agreement~~~~, the~~The Company designated 2,694,514 shares of Series B Convertible Preferred Stock in April 2021.

On September 7, 2021, the Company consummated the initial tranche of its $2 million financing contemplated by that certain Series B-1 Purchase Agreement between the Company and an investor pursuant to which the Company agreed to issue and sell the investor up to 2,694,514 shares of its newly designated Series B-1 Convertible Preferred Stock (the “Series B-1 Preferred”) at a Stated Value per share price of $0.742245 (or $2,000,000 in the aggregate). At the initial closing, the Company issued 673,628 shares of Series B-1 Preferred to the investor and received $500,000 in gross proceeds. On October 28, 2021, the Company consummated the second tranche of the Series B-1 Preferred Stock investment, issuing an additional 673,628 shares of its Series B-1 Preferred Stock to the investor at a price per share of $0.742245 or $500,000.00 in the aggregate. On November 9, 2021, the Company consummated the third and final tranche of the Series B-1 Preferred Stock investment, issuing an additional 1,347,256 shares of its Series B-1 Preferred Stock to the investor a price per share of $0.742245 or $1,000,000.00 in the aggregate. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.

On November 24, 2021, the Company entered into, and consummated the financing contemplated by, that certain Series B-1 Purchase Agreement between the Company and an investor, pursuant to which the Company issued and sold to the investor 2,694,514 shares of its Series B-1 Preferred at a per share price of $0.742245, or $2,000,000. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.

There were 8,083,542 and 2,694,514 shares of Series B and Series B-1 Convertible Preferred Stock issued and outstanding as of ~~February 28,~~May 31, 2022 and August 31, 2021, respectively.

On January 8, 2021, a 308-to-1 reverse stock split was declared effective. In accordance with the terms of all such instruments, the conversion ratio of the Company’s outstanding Series A Convertible Preferred Stock and its various convertible promissory notes, together with the exercise price of its outstanding warrants, were proportionally adjusted to give effect to the reverse stock split.

The Company is authorized to issue up to 200,000,000 shares of $0.001 par value common stock.

As discussed in Note 3 – Asset Acquisition, on November 5, 2021, the Company completed the acquisition of all of the assets, including intellectual property assets, relating to Mioxal®, a nutraceutical complex composed of essential amino acids, natural coenzymes and minerals, and assumed certain liabilities held by ST BioSciences, Ltd., a company organized under the laws of England and Wales (“STB”). As part consideration for the acquisition, the issued 19,831,623 shares of Common Stock valued at $40,654,827 or $2.05 per share.

~~There were 20,020,239 and 188,616 common shares issued and outstanding as of February 28, 2022 and August 31, 2021, respectively.~~

The Company could become a party to various legal actions arising in the ordinary course of business. Matters that are probable of unfavorable outcomes to the Company and which can be reasonably estimated are accrued. Such accruals are based on information known about the matters, the Company’s estimates of the outcomes of such matters and its experience in contesting, litigating and settling similar matters. As of the date of this report, there are no pending legal proceedings to which the Company is a party or of which any of their property is the subject, nor are there any such proceedings known to be contemplated by governmental authorities.

Due to the COVID-19 pandemic, there has been and will continue to be uncertainty and disruption in the global economy and financial markets. As the COVID-19 pandemic begins to subside, it has, and could continue to result in shelter-in-place and other similar restrictions being eased. The full extent of the impact of the COVID-19 pandemic on our business, ~~could~~results of operations, cash flows and financial position will depend on future developments, which are highly uncertain and cannot be ~~materially~~predicted, including, but not limited to, the duration and ~~adversely affected by the risks, or the public perception~~spread of the ~~risks, related~~outbreak, its severity, the prevalence and severity of any variants, the actions to contain the virus or treat its impact, and how quickly and to what extent normal economic and operating conditions can resume. Even after the COVID-19 outbreak has subsided, we may experience significant impacts to our business because of its global economic impact, including any economic downturn or recession that has occurred or may occur in the future.

As of the date of issuance of these financial statements, we are not aware of any specific event or circumstance that would require updates to our estimates and judgments or revisions due to COVID-19 to the ~~outbreak~~carrying value of ~~COVID-19. To date, COVID has directly impacted the ability we have to participate in trade show~~our assets or liabilities. These estimates may change as new events occur and ~~other in-person marketing. The risk of a pandemic, or public perception of the risk, could cause customers to avoid public places, including retail properties,~~additional information is obtained, and ~~could cause temporary or long-term disruptions in our supply chains and/or delays~~would be recognized in the ~~delivery of our inventory~~financial statements as soon as they become known. Actual results could differ from estimates and any such differences may be material to ~~customers. Further, such risks could also adversely affect retail customers’~~the financial ~~condition, resulting in reduced spending on premium products.~~statements.

As of ~~February 28,~~May 31, 2022 and August 31, 2021, the Company had no derivative liability in the accompanying condensed consolidated balance sheet, and (gain) loss on change in fair value of the derivative liability of ~~$-0-~~$0 and ~~$(665,343)~~$(881,779) for the three months ended ~~February 28,~~May 31, 2022 and 2021, respectively, and ~~$-0-~~$0 and ($~~572,701)~~1,454,480) for the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021, respectively, in the accompanying consolidated statement of operations. In addition, the Company amortized ~~$-0- and $34,088~~$0 to interest accretion during the three months ended ~~February 28,~~May 31, 2022 and 2021, respectively, and ~~$-0-~~$0 and $114,599 to interest accretion during the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021, respectively, in the accompanying consolidated statement of operations for the preferred stock warrants and derivative convertible notes payable.

~~On April 1,~~The Company evaluates events that have occurred after the balance sheet date of May 31, 2022, ~~Mr. Jason Frankovich resigned from~~through the ~~Board of Directors effective March 31, 2022. Effective April 1, 2022 Mr. Patrick Morris has been appointed by~~date which the ~~Board to replace Mr. Frankovich as a director.~~ consolidated financial statements were issued. Based upon the review, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the consolidated financial statements.

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

The following discussion of our financial condition and results of operations for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021 should be read in conjunction with the consolidated financial statements and the notes to those statements that are included elsewhere in this report. Our discussion includes forward-looking statements based upon current expectations that involve risks and uncertainties, such as our plans, objectives, expectations and intentions. Actual results and the timing of events could differ materially from those anticipated in these forward-looking statements because of several factors, including those set forth under the Part I, Item 1A, Risk Factors and Business sections in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021, as filed with the SEC on December 10, 2021 and our other filings with the SEC. We use words such as “anticipate,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “believe,” “intend,” “may,” “will,” “should,” “could,” and similar expressions to identify forward-looking statements. In addition, any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances are forward-looking statements. Such statements are based on our current expectations and could be affected by the uncertainties and risk factors described throughout this report.

Innovation1 Biotech Inc. (“IVBT”) believes it will be among the first companies to harness the raw power of botanical therapeutics by transforming them into fully synthetic drugs that are safely, reliably and consistently delivered.

There are two fundamental limitations in exploiting botanical Schedule 1 molecules:

To overcome these limitations, IVBT has engaged with a US-Israeli pharmaceutical firm that has pioneered the design and development of novel small molecules in the fields of cancer, heart disease, lung injury, intermediary metabolism and ophthalmology, with 3 exits totaling $1.4 billion, federal R&D grants and contracts totaling $160M and capital raises of $152M. The firm is currently regarded as a world leader in the design and optimization of rare cannabinoids.

The pharmaceutical firm has invented novel, proprietary, water-soluble prodrugs of the most promising botanical molecules existing today. Its prodrugs overcome the above fundamental limitations intrinsic to botanical molecules and enable for the first time the exploitation of the vast intrinsic therapeutic power of botanical Schedule 1 molecules.

IVBT has acquired five proprietary preclinical prodrugs, all fully synthetic without connection to botanical sourcing: a mushroom-derived psychedelic molecule for treatment post-traumatic stress disorder and depression, a novel cannabinoid and tree bark derived psychedelic for treatment of addiction and three additional novel cannabinoid prodrugs addressing clinical indications of refractory epilepsy, burn wounds and uveitis.

IVBT also owns a ~~currently approved~~patented nutraceutical complex specially designed and formulated to contribute and help maintain normal energy metabolism, improve mood and reduce fatigue for those suffering from fibromyalgia and/or chronic fatigue syndrome. We look to initiate sales of this product in the marketplace in 2022.

IVBT’s drug portfolio uniquely positions IVBT to capitalize on the growing global demand for pharmaceutical Schedule 1 drugs.

Our financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. We have not yet established an ongoing source of revenues sufficient to cover our operating costs. Our ability to continue as a going concern is dependent on our company obtaining additional capital to fund operating losses until we become profitable. If we are unable to obtain additional capital, we could be forced to significantly curtail or cease operations.

We have only realized nominal revenues from our business. In the next 12 months, we plan to identify business to whom we can license and/or distribute our product, Mioxal® product as well as seek additional opportunities to continue as a going concern.

In December 2019, a novel strain of COVID-19 was reported in China. Since then, the COVID-19 has spread globally including across North America and the United States. The spread of COVID-19 from China to other countries has resulted in the World Health Organization (WHO) declaring the outbreak of COVID-19 as a “pandemic,” or a worldwide spread of a new disease, on March 11, 2020. Specifically, we caution that our business could be materially and adversely affected by the risks, or the public perception of the risks, related to the outbreak of COVID-19. To date, COVID has directly impacted the ability we have to participate in trade show events and other in-person marketing. The risk of a pandemic, or public perception of the risk, could cause customers to avoid public places, including retail properties, and could cause temporary or long-term disruptions in our supply chains and/or delays in the delivery of our inventory to customers. Further, such risks could also adversely affect retail customers’ financial condition, resulting in reduced spending on premium products.

~~Please refer to Note 2 - Summary of Significant Accounting Policies in the accompanying Notes to the Consolidated Financial Statements.~~

~~Results of Operations for the Three Months Ended February 28, 2022 and 2021~~

~~Overview~~. We had revenues of $-0- for the three months ended February 28, 2022 and 2021, respectively. We incurred a net income (loss) of ($1,779,054) and $557,950 for the three months ended February 28, 2022 and 2021, respectively. The increase in net loss is attributable to the factors discussed below.

~~Revenues~~. We had $-0- revenues from operations for the three months ended February 28, 2022 and 2021. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

~~Gross Margin~~~~. We had $-0- gross margin for the three months ended February 28, 2022 and 2021.~~

~~Expenses~~. Our operating expenses were $1,782,362 and $56,274 for the three months ended February 28, 2022 and 2021, respectively. The increase was primarily attributable our November 5, 2021 asset acquisition from ST BioSciences, Ltd., (“STB”). Four former STB employees or contractors were hired which increased salaries approximately $478,921, consulting fees increased approximately $88,475 for compensation for our former CFO, professional fees increased approximately $268,224 from the legal cost associated with our November 5, 2021 asset acquisition, amortization expense related to the asset acquisition and the right-of-use asset increased 883,048, and an approximate $7,525 increase in other general and administrative and advertising expenses.

~~Other (Income) Expense~~. Our total other (income) expense was ($3,308) and ($614,224) for the three months ended February 28, 2022 and 2021, respectively. The $610,916 decrease in other income was attributable to a gain on derivative liability during the prior year, a decrease in interest expense and a decrease in interest income.

~~Results of Operations for the Six Months Ended February 28, 2022 and February 28, 2021~~

~~Overview~~. We had revenues of $-0- and $3,080 for the six months ended February 28, 2022 and 2021, respectively. We incurred a net income (loss) of ($2,018,907) and $320,681 for the six months ended February 28, 2022 and 2021, respectively. The increase in net loss is attributable to the factors discussed below.

~~Revenues~~. We had $-0- and $3,080 revenues from operations for the six months ended February 28, 2022 and 2021, respectively. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

~~Gross Margin~~~~. We had $-0- and $1,659 gross margin for the six months ended February 28, 2022 and 2021, respectively.~~

~~Expenses~~. Our operating expenses were $2,143,434 and $115,111 for the six months ended February 28, 2022 and 2021, respectively. The increase of $2,028,323 was primarily attributable our November 5, 2021 asset acquisition from ST BioSciences, Ltd., (“STB”). Consulting fees increased by $211,805, professional fees increased by $345,534, salaries increased by $580,112, amortization expense increased $883,048 and general and administrative expenses increased by $7,982.

~~Other (Income) Expense~~. Our total other (income) expense was ($124,527) and ($434,133) for the six months ended February 28, 2022 and 2021, respectively. The $309,606 decrease in other (income) was attributable to a gain on derivative liability and interest accretion during the six months ended February 28, 2021. Interest expense decreased by $61,417, interest income decreased by $35,105,

~~For the six months ended February 28, 2022, we used net cash of $1,974,053 from operating activities, primarily attributable to our November 5, 2021 asset acquisition from ST BioSciences, Ltd.~~

~~For the six months ended February 28, 2022, we used net cash of $853,138 from investing activities, for our November 5, 2021 asset acquisition from ST BioSciences, Ltd.~~

~~For the six months ended February 28, 2022, cash of $4,000,000 was provided from financing activities with $4,000,000 received for our Series B-1 Convertible Stock financing.~~

We had total assets of $82,763,415 as of February 28, 2022, which consisted of $1,310,285 cash, other receivable of $179,770, prepaid expenses of $30,300, equipment of $3,138, security deposit of $60,000, $585,390 right-of-use asset, trademarks of $1,680, and intangibles asset of $80,592,852 from our November 5, 2021 asset acquisition from ST BioSciences, Ltd.

~~The cash of $1,310,285 is attributable to our Series B-1 Convertible Stock financing for $4,000,000. For a further discussion, see~~ ~~Note 9 – Stockholders’ Equity~~ ~~in the accompanying notes to the financial statements.~~

We had total liabilities of $40,576,792 as of February 28, 2022 consisting of accounts payable of $101,593, accrued expenses of $12,514, current acquisition payments due to Ingenius of $28,500,000, note payable - current portion of $10,000, lease payable – current portion of $189,527, lease payable $400,504, dividends payable of $362,654 for our Series B and Series B-1 Convertible Preferred stock and long-term acquisition payments due to Ingenius of $11,000,000. With the November 5, 2021 asset acquisition from ST BioSciences, Ltd., the Company assumed current and long-term liabilities of $39,923,000 for Mioxal and accounts payable.

To date the Company only generated nominal revenues and consequently has incurred recurring losses from operations. We do not have sufficient funds to support our daily operations for the next twelve (12) months. ~~The ability of the Company to continue as a going concern is dependent on raising capital to fund our business model and ultimately to attain profitable operations.~~ Accordingly, these factors raise substantial doubt as to the Company’s ability to continue as a going concern.

The Company is attempting to commence operations and generate sufficient revenue; however, the Company’s cash position may not be sufficient to support its daily operations. While the Company believes in the viability of its strategy to commence operations and generate sufficient revenue and in its ability to raise additional funds, there can be no assurances to that effect. The ability of the Company to continue as a going concern is dependent upon its ability to further implement its business model and generate sufficient revenue and its ability to raise additional funds by way of a public or private offering.

We have only realized nominal revenues from our business in a prior year. In the next 12 months, we plan to identify business to whom we can license and/or distribute our product, Mioxal®, as well as seek additional opportunities to continue as a going concern.

Please refer to Note 2 - Summary of Significant Accounting Policies in the accompanying Notes to the Consolidated Financial Statements.

Overview. We had revenues of $0 for the three months ended May 31, 2022 and 2021, respectively. We incurred a net income (loss) of ($1,609,876) and $796,156 for the three months ended May 31, 2022 and 2021, respectively. The increase in net loss is attributable to the factors discussed below.

Revenues. We had $0 revenues from operations for the three months ended May 31, 2022 and 2021. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

Gross Margin. We had $0 gross margin for the three months ended May 31, 2022 and 2021.

Expenses. Our operating expenses were $1,595,378 and $47,097 for the three months ended May 31, 2022 and 2021, respectively. The increase was primarily attributable to our November 5, 2021 asset acquisition from ST BioSciences, Ltd., (“STB”). Four former STB employees or contractors were hired which increased salaries approximately $357,212, consulting fees increased approximately $68,000 for compensation for our former CFO, professional fees increased approximately $214,343 from the legal cost associated with our November 5, 2021 asset acquisition, amortization expense related to the asset acquisition and the right-of-use asset increased $900,526, and an approximate $8,200 increase in other general and administrative and advertising expenses.

Other (Income) Expense. Our total other (income) expense was $14,498 and ($843,253) for the three months ended May 31, 2022 and 2021, respectively. The $857,751 decrease in other income was attributable to a gain on derivative liability during the prior year, a decrease in interest expense and a decrease in interest income.

Overview. We had revenues of $0 and $3,080 for the nine months ended May 31, 2022 and 2021, respectively. We incurred a net income (loss) of ($3,628,782) and $1,116,837 for the nine months ended May 31, 2022 and 2021, respectively. The increase in net loss is attributable to the factors discussed below.

Revenues. We had $0 and $3,080 revenues from operations for the nine months ended May 31, 2022 and 2021, respectively. The extent to which, and the amount of revenues which may be generated from our future business operations and activities is unknown.

Gross Margin. We had $0 and $1,659 gross margin for the nine months ended May 31, 2022 and 2021, respectively.

Expenses. Our operating expenses were $3,738,811 and $162,208 for the nine months ended May 31, 2022 and 2021, respectively. The increase of $3,576,604 was primarily attributable to our November 5, 2021 asset acquisition from ST BioSciences, Ltd., (“STB”). Consulting fees increased by $279,805, professional fees increased by $559,877, salaries increased by $937,324, amortization expense increased $1,783,574 and general and administrative and advertising expenses increased by $16,024.

Other (Income) Expense. Our total other (income) expense was ($110,029) and ($1,277,386) for the nine months ended May 31, 2022 and 2021, respectively. The $1,167,357 decrease in other (income) was attributable to a gain on derivative liability and interest accretion during the nine months ended May 31, 2021. Interest expense decreased by $75,257, interest income decreased by $41,929,

For the nine months ended May 31, 2022, we used net cash of $2,648,179 from operating activities, primarily attributable to our November 5, 2021 asset acquisition from ST BioSciences, Ltd.

For the nine months ended May 31, 2022, we used net cash of $853,138 from investing activities, for our November 5, 2021 asset acquisition from ST BioSciences, Ltd.

For the nine months ended May 31, 2022, cash of $4,000,000 was provided from financing activities with $4,000,000 received for our Series B-1 Convertible Stock financing.

We had total assets of $81,162,939 as of May 31, 2022, which consisted of $636,159 cash, other receivable of $56,421, prepaid expenses of $127,826, equipment of $2,876, security deposit of $60,000, $533,738 right-of-use asset, trademarks of $1,680, and intangibles asset of $79,744,239 from our November 5, 2021 asset acquisition from ST BioSciences, Ltd.

The cash of $636,159 is attributable to our Series B-1 Convertible Stock financing for $4,000,000. For a further discussion, see Note 9 – Stockholders’ Equity in the accompanying notes to the financial statements.

We had total liabilities of $40,873,763 as of May 31, 2022 consisting of accounts payable of $133,578, accrued expenses of $35,555, current acquisition payments due to Ingenius of $28,500,000, note payable - current portion of $10,000, lease payable – current portion of $194,305, lease payable $350,099, dividends payable of $650,226 for our Series B and Series B-1 Convertible Preferred stock and long-term acquisition payments due to Ingenius of $11,000,000. With the November 5, 2021 asset acquisition from ST BioSciences, Ltd., the Company assumed current and long-term liabilities of $39,923,000 for Mioxal and accounts payable.

As a smaller reporting company (as defined in Rule 12b-2 of the Exchange Act), we are not required to provide the information called for by this Item 3.

Under the supervision and with the participation of our management, our principal executive officer and our principal financial officer are responsible for conducting an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of the end of the fiscal year covered by this report. Disclosure controls and procedures means that the material information required to be included in our Securities and Exchange Commission reports is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms relating to our company, including any consolidating subsidiaries, and was made known to us by others within those entities, particularly during the period when this report was being prepared. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were not effective as of ~~February 28,~~May 31, 2022 as a result of continuing weaknesses in our internal control over financial reporting as set forth in our Annual Report on Form 10-K for the fiscal year ended August 31, 2021 as filed with the SEC on December 10, 2021.

Changes in Internal Control Over Financial Reporting. There were no changes in the Company’s internal controls over financial reporting during the most recently completed fiscal quarter that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

The Company is not currently subject to any legal proceedings. From time to time, the Company may become subject to litigation or proceedings in connection with its business, as either a plaintiff or defendant. There are no such pending legal proceedings to which the Company is a party that, in the opinion of management, is likely to have a material adverse effect on the Company’s business, financial condition or results of operations.

We incorporate by reference the risk factors disclosed in Part I, Item 1A of our Annual Report on Form 10-K for the fiscal year ended August 31, 2021 as filed with the SEC on December 10, 2021.

On September 7, 2021, the Company consummated the initial tranche of its $2 million financing contemplated by that certain Series B-1 Purchase Agreement between the Company and an investor pursuant to which the Company agreed to issue and sell to LPC up to 2,694,514 shares of its newly designated Series B-1 Convertible Preferred Stock (the “Series B-1 Preferred”) at a Stated Value per share price of $0.742245 (or $2,000,000 in the aggregate). At the initial closing, the Company issued 673,628 shares of Series B-1 Preferred to LPC and received $500,000 in gross proceeds. On October 28, 2021, the Company consummated the second tranche of the Series B-1 Preferred Stock investment, issuing an additional 637,628 shares of its Series B-1 Preferred Stock to LPC at a price per share of $0.742245 or $500,000.00 in the aggregate. On November 9, 2021, the Company consummated the third and final tranche of the Series B-1 Preferred Stock investment, issuing an additional 1,347,256 shares of its Series B-1 Preferred Stock to LPC at a price per share of $0.742245 or $1,000,000.00 in the aggregate. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.

On November 24, 2021, the Company ~~entered into, and~~ consummated ~~the~~a financing ~~contemplated by, that certain~~through a Series B-1 Purchase Agreement between the Company and an investor, pursuant to which the Company issued and sold to L1 Capital 2,694,514 shares of its Series B-1 Preferred at a per share price of $0.742245, or $2,000,000 in the aggregate. The aggregate gross proceeds of $2,000,000 was used by the Company as working capital.

We entered into an employment agreement with ~~Mr. Kraws~~Dr. Andrew Salzman effective as of ~~March 16,~~April 17, 2022 (the “Employment Agreement”).

Pursuant to the Employment Agreement, ~~Mr. Kraws~~Dr. Salzman was retained for a ~~four-year~~one-year period as our Chief ~~Executive~~Scientific Officer reporting to our ~~Board of Directors. Mr. Kraws’~~Chief Executive Officer. Dr. Salzman’s base salary is ~~$450,000 subject to annual cost of living increases in the amount of 2.5% of his then-current base salary, not to be less than $450,000 per year. Mr. Kraws~~$120,000. Dr. Salzman shall also ~~be paid an annual retention bonus of $200,000 per year. IN addition, Mr. Kraws will~~ be eligible to earn an annual cash performance bonus of up to 50% of his then-current annual base salary as determined by our ~~Board~~Chief Executive Officer based on the achievement of performance goals and objectives established by the ~~Company and Mr. Kraws on an annual basis. Mr. Kraws shall~~Company. The Employment Agreement also be granted option to purchase 350,000 shares of our common stock at prevailing market prices on the date of grant. The options will be subject to a five-year vesting schedule such that one-fifth of such options will vest each year. The NEO Employment Agreements also containcontains standard confidentiality and ~~non-competition~~con-competition covenants.

~~Pursuant~~Dr. Salzman’s employment agreement also contains standard language concerning the payment of salary, bonus, expenses or severance otherwise to the Employment Agreement, in the event Mr. Kraws’ employment is terminated due to the expiration of the term of the Employment Agreement, his death or disability (as defined in the Employment Agreement), by the Company without Cause (as defined in the Employment Agreement) or by Mr. Kraws without Good Reason (as defined in the Employment Agreement), Mr. Kraws will be entitled to receive: (i) any accrued but unpaid base salary for services rendered to the date of termination, (ii) any unpaid guaranteed bonus and any earned but unpaid performance bonus, and (iii) reimbursement of any accrued but unpaid expenses required to be reimbursed under the Employment Agreement.

Pursuant to the Employment Agreement, in the event Mr. Kraws’ employment is terminated by the Company without Cause or by Mr. Kraws with Good Reason, Mr. Kraws will be entitled to receive: (i) any accrued but unpaid base salary for services rendered to the date of termination, (ii) any unpaid guaranteed bonus and any earned but unpaid performance bonus, (iii) reimbursement of any accrued but unpaid expenses required to be reimbursed under the Employment Agreement and (iv) as severance payments, (1) an amount equal to the greater of (a) Mr. Kraws’ annual base salary and guaranteed bonus for a two-year period or (b) Mr. Kraws’ annual base salary for the remaining portion of the term of the Employment Agreement and (2) an amount equal to Mr. Kraws’ guaranteed bonus for the remaining term of the Employment Agreement. Such payments are contingent upon the Company and Mr. Kraws executing a mutual release.

~~Pursuant to the Employment Agreement~~him in the event of termination or a ~~Change~~change in Control (as defined in the Employment Agreement), (i) if Mr. Kraws’ employment is terminated without Cause by the Company or its successor or by Mr. Kraws with Good Reason following the Chane in Control, Mr. Kraws will be entitled to receive: (i) any accrued but unpaid base salary for services rendered to the date of termination, (ii) any unpaid guaranteed bonus and any earned but unpaid performance bonus, (iii) reimbursement of any accrued but unpaid expenses required to be reimbursed under the Employment Agreement and (iv) as severance payments, (1) an amount equal to the greater of (a) Mr. Kraws’ annual base salary and guaranteed bonus for a two-year period or (b) Mr. Kraws’ annual base salary for the remaining portioncontrol of the term of the Employment Agreement, (2) an amount equal to Mr. Kraws’ guaranteed bonus for the remaining term of the Employment Agreement and (3) an amount equal to Mr. Kraws’ annual cash performance bonus for the remaining term of the Employment Agreement.Company.

(a) The following Exhibits, as required by Item 601 of Regulation SK, are attached or incorporated by reference, as stated below.

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.

Nevada		82-2275255
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		Identification No.)

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
none		not applicable		not applicable

Index			Page

Part I. Financial Information

Item 1.	Financial Statements		4

	Condensed Consolidated Balance Sheets at ~~February 28,~~May 31, 2022 (Unaudited) and August 31, ~~2021.~~2021	4	5

	Condensed Consolidated Statements of Operations for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021 (Unaudited).	5	6

	Condensed Consolidated Statement of Stockholders’ Equity (Deficit) for the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021 (Unaudited).		6

	Condensed Consolidated Statements of Cash Flow for the ~~six~~nine months ended ~~February 28,~~May 31, 2022 and 2021 (Unaudited).		7

	Notes to Condensed Consolidated Financial Statements (Unaudited).		8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations.~~Operations	17	16

Item 3.	Quantitative and Qualitative Disclosures About Market ~~Risk.~~Risk	19	18

Item 4.	Controls and ~~Procedures.~~Procedures	19	18

Part II. Other Information

Item 1.	Legal ~~Proceedings.~~Proceedings	20	19

Item 1A.	Risk Factors	20	19

Item 2.	Unregistered Sales of Equity Securities and Use of ~~Proceeds.~~Proceeds	20	19

Item 3.	Defaults Upon Senior ~~Securities.~~Securities		19

Item 4.	Mine Safety Disclosures		19

Item 5.	Other Information		19

Item 6.	Exhibits		20

~~Item 4.~~	~~Mine Safety Disclosures.~~	20

~~Item 5.~~	~~Other Information.~~	20

~~Item 6.~~	~~Exhibits.~~	21

Signatures		22	21

	·	~~we have a history of losses;~~
		•	we have a history of losses;
	·	•	our auditors have raised substantial doubts about our ability to continue as a going concern;

•	·	we have a working capital deficit and need to raise additional capital to continue our business model;

•	·	the adverse impact of COVID-19 on our company; and

	·•	our reliance on our two officers and directors.

	·	~~the applicability of penny stock rules; and~~
		•	the applicability of penny stock rules; and
	·	•	material weaknesses in our internal control over financial reporting; and

•	·	the significant dilution to our stockholders upon the conversion of the outstanding Series B Convertible Preferred Stock.

Large accelerated filer	☐	Non-accelerated Filer	☒
Accelerated filer	☐	Smaller reporting company	☒
Emerging growth company	☐

	·	On September 10, 2022 - $4,000,000

	·	On September 10, 2023 - $5,000,000

	·	On September 10, 2024 - $6,000,000

	·	Total stock to be issued - $15,000,000

Mioxal®	81,249,827
Other intangible assets	178,000

Less liabilities assumed:
Mioxal® liability assumed	(39,500,000	)
Other liabilities assumed	(423,000
		)
Net value acquired in asset acquisition	41,504,827

	1.	Large and unpredictable pharmacokinetic excursions, both high and low, that make the drug potentially dangerous or ineffective

	2.	Insolubility in water that curtails bioavailability across mucosal membranes

		Incorporated by Reference			Filed or Furnished
No.	Exhibit Description	Form	Date Filed	Number	Herewith
3.1.1	Articles of Incorporation	S-1	4/13/2015	3.1
3.1.2	Certificate of Amendment	10-K	12/15/2017	3.1.2
3.1.3	Certificate of Amendment	8-K	2/21/2018	3.1.1
3.1.4	Certificate of Amendment	8-K	8/16/2018	3.1.1
3.1.5	Certificate of Amendment	8-K	8/16/2018	3.1.2
3.1.6	Certificate of Designation	8-K	8/16/2018	3.1.3
3.1.7	Certificate of Correction	8-K	8/16/2018	3.1.4
3.1.8	Articles of Amendment filed December 22, 2020 effective January 8, 2021	8-K	1/11/21	3.1.8
3.1.9	Articles of Amendment filed March 31, 2022 effective March 31, 2022	8-K	4/6/22	3.1.9
3.2	Bylaws	S-1	4/13/2015	3.2
10.1	Jeffrey Kraws employment agreement effective March 16, 2022				Filed
31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002				Filed
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002				Filed
32.1	Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002				Filed
101.INS	Inline XBRL Instance Document				Filed
101.SCH	Inline XBRL Taxonomy Extension Schema Document				Filed
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document				Filed
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document				Filed
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document				Filed
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document				Filed

	INNOVATION1 BIOTECH, INC.
	(Name of Registrant)

Date: ~~April~~July 14, 2022	By:	/s/ ~~Jeffrey~~Jeffery J. Kraws
	Name:	Jeffery J. Kraws
	Title:	Chief Executive Officer (Principal Executive ~~Officer~~ and Principal Financial Officer)