InMed Pharmaceuticals Inc.

ITEM 1A. RISK FACTORS.

Reference is made to Part I, Item 1A, Risk Factors included in the 2024 Annual Report for information concerning risk factors, which should be read in conjunction with the factors set forth in Cautionary Statement Regarding Forward-Looking Statements of this Report. There have been no material changes with respect to the risk factors disclosed in our 2024 Annual Report, except as set forth below and in the December 2024 Form 10-Q. You should carefully consider such factors in the 2024 Annual Report, the December 2024 Form 10-Q and below, which could materially and adversely affect our business, financial condition orand future results. The risks described in theour 2024 Annual Report , the December 2024 Form 10-Q and below, are not exhaustive and therefore, there are additional risks facing the Company that could adversely affect its business, financial condition and future results. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

We maywill require additional financing, and a failure to obtain this necessary capital when needed could force us to delay, limit, or reduce our investments in advertisimarketing and other strategic initiatives planned for future growth.

On December 13, 2024, we entered the SEPA with the Investor, whereby we have the right, but not the obligation, to sell to the Investor Common Shares up to the Commitment Amount during the 36-month period following the Effective Date, subject to certain conditions. The Common Shares that may be issued under the SEPA may be sold by us to the Investor at our discretion from time to time and sales of Common Shares under the SEPA will depend upon market conditions and other factors. Additionally, in no event may we sell and issue the aggregate number of Common Shares that is equal to or in excess of the Exchange Cap, unless we obtain shareholder approval to issue Common Shares in excess of the Exchange Cap in accordance with applicable Nasdaq rules and comply with certain other requirements as described in the SEPA. We are unable to predict or provide assurances as of the date of this Quarterly Report that such shareholder approval would be obtained on a timely manner, if at all. As a result, unless our stock price exceeds $5.15, we will be unable to sell the full Commitment Amount to the Investor without seeking stockholder approval to issue additional Common Shares in excess of the Exchange Cap. In addition, the issuance of Common Shares under the SEPA is subject to further limitations, including that the Common Shares beneficially owned by the Investor and its affiliates will not exceed 9.99%, in the aggregate.

We may ultimately decide to sell all or some of the Common Shares that may be available for us to sell pursuant to the SEPA. Because the purchase price per share to be paid by the Investor for the Common Shares that we may elect to sell under the SEPA will fluctuate based on the market prices of our Common Shares during the applicable pricing period for each of those sales, it is not possible for us to predict, as of the date of this Quarterly Report and prior to any such sales, the number of Common Shares that we will sell under the SEPA, the purchase price per share or the aggregate gross proceeds that we will receive from those purchases under the SEPA. Further, the resale by the Investor of a significant number of Common Shares at any given time, or the perception that such sales may or are likely to occur, could cause the market price of our Common Shares to materially decline and be highly volatile.

Accordingly, due to the foregoing, we may not have access to the full Commitment Amount unless the market price of our Common Shares remains stable throughout the term of the SEPA. Any significant decrease to the price of our Common Shares could materially limit our ability to sell the full Commitment Amount to the Investor. If the aggregate selling price of our Common Shares under the SEPA is below $5.15, it is possible that we may not be permitted to draw the full amount of proceeds of the drawdown request from the Investor, which may not provide adequate funding for our planned operations and may materially decrease our liquidity.

T On April 4, 2025, the transition to a new presidential administration in tCompany announced the meeting, record date and certain other information relating to the June Special Meeting, pursuant to a filing submitted to SEDAR. On April, 29,2025, the Company filed the Preliminary Proxy Statement on EDGAR. The Company expects to file the definitive proxy statement on or about May 12, 2025, and will subsequently mail copies of the definitive proxy statement and proxy cared and accompanying materials to the Companys holders of Common Shares. At the United States, includJune Special Meeting, holders of Common Shares will be asked to approve the potential issuance of 20% or more of the Companys issued and outstanding Common Shares under the potential use SEPA pursuant to the Nasdaq Listing Rules 5635(d) and effects o5635(b).

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The threat or actual adoption of tariffs to address the administr, retaliatory tariffs and duties, trade barriers and restrictions, and related internations poal trade conflicy goalts, including by the United States, coCanada or other jurisdictions, could materially impact the macroeconomic framework in which we operate.

ThSince transition to a new aking office in January 2025, the current U.S. presidential administration in the United States coulhas issued numerous executive orders, including with respect to international and domestic policies, and impact n the first and second quarters of 2025, the macroeconomic framework in whichre were significant changes to tariffs by the U.S. and other countries. In the second quarter of 2025, new U.S. tariffs we operate, and we are unable to pre announced, including additional tariffs on imports from China, India, Japan, South Korea, Taiwan, Vietnam and the EU, among others. In response, several countries have imposed, or threatened to impose, recisely predict what actions procal tariffs on imports from the U.S. and other retaliatory measures. Various modifications and delays to the U.S. tariffs have been announced and furthe new administration will take. Fr changes are expected to be made in the future, which may include additional sector-based tariffs or example,other measures. The ultimate impact remains uncertain and will depend on February 1, 2025, several factors, including whethe currentr additional or incremental U.S. presidential administration announcetariffs or other measures are announced or imposed, to what extent other countries implement tariffs or other retaliatory measures in response, and the implementaoverall magnitude and duration of a 25% additional tariff on imports from Canada. While tthese measures. If disputes and conflicts further escalate, actions by the governments in response could be significantly more severe and restrictive. Trade disputes, tariffs, restrictions and other political tensions between the administration agreed to put a 30-daU.S. and other countries may also exacerbate unfavorable macroeconomic conditions including inflationary pause on the implementation of such tressures, foreign exchange volatility, financial market instability, and economic recessions or downturns. The ultimate impact of current or future tariffs, such tariffs may ultimate and trade restrictions remains uncertain. While we actively monitor these risks and manage our supply chains accordingly, prolonged economic or geopolitical disruptions could adversely be re-implemented in the event that the Uniaffect our business, ability to access the capital markets or other financing sources, results of operations, financial conditions and prospects. In addition, tariffs and other trade developments have and may continue to heighten the risks related States and Canada are to the other risk factors described elsewhere in this Quarterly Report. The ultimately unable to agree to economic terms outcome and consequences of the implementation of tariffs or other restrictive trade measures by the U.S. and other countries (including in the form of reciprocal measures) remains highly uncertain. Any trade wars, through the implementation of tariffs or otherwise, has the potentcould material toly and adversely affect us, incldirectly and indirectly, including by adversely impacting (a) the supply chains for our operations as well as the third parties with whom we engage, declining consumer confidence, inflation, lower economic expectations, and (b)increasing the macroeconomic markets at largcosts of services we provide and utilize.

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