Forward-Looking Statements





The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with the financial statements and the
related notes and other information that are included elsewhere in this Form
10-K. This discussion contains 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 as a result of a number of factors, including those set forth under
the cautionary note regarding "Forward-Looking Statements" contained elsewhere
in this Form 10-K. Additionally, you should read the "Risk Factors" section of
this Form 10-K for a discussion of important factors that could cause actual
results to differ materially from the results described in or implied by the
forward-looking statements contained in the following discussion and analysis.

Our audited financial statements are stated in United States dollars and are prepared in accordance with United States generally accepted accounting principles.





We assume no obligation to revise or publicly release the results of any
revision to these forward-looking statements, except as required by law. Given
these risks and uncertainties, readers are cautioned not to place undue reliance
on such forward-looking statements.

Unless expressly indicated or the context requires otherwise, the terms "Rasna,"," the "Company," "we," "us," and "our" refer to Rasna Therapeutics, Inc., a Nevada corporation, and, where appropriate, its wholly owned subsidiaries.





Company Background



Overview




To date, we have devoted substantially all of our resources to research and
development efforts relating to our therapeutic candidates, including conducting
clinical trials and developing manufacturing capabilities, in-licensing related
intellectual property, protecting our intellectual property and providing
general and administrative support for these operations. Since our inception, we
have funded our operations primarily through the issuance of equity securities.

We anticipate that our expenses will increase substantially if and as we:





    ?   continue enrollment in our ongoing clinical trials;

    ?   initiate new clinical trials;

? seek to identify, assess, acquire and develop other products, therapeutic

candidates and technologies;

? seek regulatory and marketing approvals in multiple jurisdictions for our


        therapeutic candidates that successfully complete clinical studies;

    ?   establish collaborations with third parties for the development and
        commercialization of our products and therapeutic candidates;

? make milestone or other payments under our agreements pursuant to which we

have licensed or acquired rights to intellectual property and technology

seek to maintain, protect, and expand our intellectual property portfolio;

? seek to attract and retain skilled personnel;

? incur the administrative costs associated with being a public company and

related costs of compliance;

? create additional infrastructure to support our operations as a commercial

stage public company and our planned future commercialization efforts; and



    ?   experience any delays or encounter issues with any of the above.




We expect to continue to incur significant expenses and increasing losses for at
least the next several years. Accordingly, we anticipate that we will need to
raise additional capital in addition to the net proceeds from this offering in
order to obtain regulatory approval for, and the commercialization of our
therapeutic candidates. Until such time that we can generate meaningful revenue
from product sales, if ever, we expect to finance our operating activities
through public or private equity or debt financings, government or other
third-party funding, marketing and distribution arrangements and other
collaborations, strategic alliances and licensing arrangements or a combination
of these approaches. If we are unable to obtain funding on a timely basis, we
may be required to significantly curtail, delay or discontinue one or more of
our research or development programs or the commercialization of any approved
therapies or products or be unable to expand our operations or otherwise
capitalize on our business opportunities, as desired, which could materially
adversely affect our business, financial condition and results of operations.

We only have one segment of activity which is that of a clinical stage biotechnology company focused on targeted drugs to treat diseases in oncology and immunology, mainly focusing on the treatment of leukemia.





                                       48

Summary of significant accounting policies





This discussion and analysis of our financial condition and results of
operations is based on our consolidated financial statements, which have been
prepared in accordance with generally accepted accounting principles in the
United States of America, or GAAP. The preparation of these financial statements
requires us to make estimates and assumptions that affect the reported amounts
of assets and liabilities, disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenue and
expenses during the reported period. In accordance with US GAAP, we base our
estimates on historical experience and on various other assumptions that we
believe are reasonable under the circumstances. Actual results may differ from
these estimates under different assumptions or conditions.



While our significant accounting policies are more fully described in Note 2 to
our audited consolidated financial statements appearing elsewhere in this Annual
Report, we believe the following accounting policies are critical to the process
of making significant judgments and estimates in the preparation of our
financial statements.



Basis of preparation



The accompanying consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States of
America ("US GAAP"). Any reference in these notes to applicable guidance is
meant to refer to US GAAP as found in the Accounting Standards Codification
("ASC") and Accounting Standards Updates ("ASU") of the Financial Accounting
Standards Board ("FASB").



Principles of Consolidation



In accordance with ASC 810, Consolidation, the Company consolidates any entity
in which it has a controlling financial interest. Further, the Company
consolidates any variable interest entity that it is deemed to be the primary
beneficiary of, and have the power to direct its significant activities. Upon
review of the relationship between Rasna Therapeutics ("Rasna UK") and the
Company, Management determined that the equity investment in Rasna UK was not
sufficient to fund its operations. Accordingly, the Company is considered to be
the primary beneficiary of the assets held within Rasna UK, which primarily
consist of cash received from the Company to fund its operations, and has power
to direct its significant activities. As a result, the Company consolidates this
variable interest entity, which has minimal activity and has been liquidated.



The consolidated financial statements include the financial statements of the
Company and its wholly owned subsidiary, Rasna Research Inc, and Rasna Research
Inc's subsidiary, Arna Therapeutics Limited. All significant intercompany
accounts and transactions have been eliminated in the preparation of the
accompanying consolidated financial statements.



                                       49





Going Concern



We are subject to a number of risks similar to those of other pre-commercial
stage companies, including its dependence on key individuals, uncertainty of
product development and generation of revenues, dependence on outside sources of
capital, risks associated with research, development, testing, and obtaining
related regulatory approvals of its pipeline products, suppliers and
collaborators, successful protection of intellectual property, competition with
larger, better-capitalized companies, successful completion of our development
programs and, ultimately, the attainment of profitable operations are dependent
on future events, including obtaining adequate financing to fulfill its
development activities and generating a level of revenues adequate to support
the Company's cost structure.



We have experienced net losses and significant cash outflows from cash used in
operating activities over the past two years, and as of September 30, 2021, had
an accumulated deficit of $23,534,479, a net loss for the year ended September
30, 2021 of $875,998 and net cash used in operating activities of $293,393.
These conditions indicate that there is substantial doubt about our ability to
continue as a going concern within the next twelve months from the filing date
of this annual report on Form 10-K.



We expect to continue to incur net losses and have significant cash outflows for
at least the next twelve months. We currently have sufficient funds to continue
operating until the end of June 2022 , but will require significant additional
cash resources to launch new development phases of existing products in its
pipeline. Additional cash injections are expected from Panetta partners which is
expected to enable the Company to continue our operations through at least March
2023, however in the event that we are unable to secure the necessary additional
cash resources needed, we may need to slow current development phases or halt
new development phases in order to mitigate the effects of the costs of
development . The accompanying consolidated financial statements have been
prepared assuming that we will continue as a going concern. This basis of
accounting contemplates the recovery of our assets and the satisfaction of
liabilities in the normal course of business. A successful transition to
attaining profitable operations is dependent upon achieving a level of positive
cash flows adequate to support our cost structure.



Use of Estimates




The preparation of financial statements in conformity with US GAAP requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosure of contingent liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. We evaluate our estimates on an ongoing basis, including
those related to the fair values of stock based compensation awards, the
modification and extinguishment of debt, troubled debt restructuring,
derivatives and valuations associated with derivatives, income taxes and
contingent liabilities, among others. We base our estimates on historical
experience and on various other assumptions that we believe to be reasonable,
the results of which form the basis for making judgments about the carrying
amounts of assets and liabilities. Actual results could differ from those
estimates and such differences could be material to our consolidated financial
position and results of operations.



                                       50

Goodwill and Intangible assets





Intangible assets are made up of in-process research and development, ("IPR&D")
and certain intellectual property ("IP"). The balance of IPR&D represents IPR&D
acquired in 2013, which, at the time, was determined to have alternative future
uses. IPR&D assets also represent the fair value assigned to acquired
technologies in a business combination, which at the time of the business
combination have not reached technological feasibility and have no alternative
future use. IP assets represent the fair value assigned to technologies, which
at the time of acquisition have reached technological feasibility, however, have
not yet been put into service. Intangible assets are considered to have an
indefinite useful life until the completion or abandonment of the associated
research and development projects.



Goodwill represents the premium paid over the fair value of the net tangible and
intangible assets acquired in business combinations. Goodwill is not amortized;
rather, it is subject to a periodic assessment for impairment by applying a fair
value based test. Goodwill is assessed for impairment on an annual basis or more
frequently if events or changes in circumstances indicate that the asset might
be impaired. An impairment charge is recognized only when the implied fair value
of our reporting unit's goodwill is less than its carrying amount.



Management evaluates indefinite life intangible assets for impairment on an
annual basis and on an interim basis if events or changes in circumstances
between annual impairment tests indicate that the asset might be impaired. The
ongoing evaluation for impairment of its indefinite life intangible assets
requires significant management estimates and judgment. Management reviews
definite life intangible assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Goodwill and intangible assets were fully impaired as of September
30, 2020.



Risks and Uncertainties

We intend to operate in an industry that is subject to rapid change. Our operations will be subject to significant risk and uncertainties including financial, operational, technological, regulatory, and other risks associated with an early-stage company, including the potential risk of business failure.





Research and development



Expenditure on research and development is charged to the statement of
operations in the year in which it is incurred with the exception of
expenditures incurred in respect of the development of major new products where
the outcome of those projects is assessed as being reasonably certain in regard
to viability and technical feasibility. Such expenditure is capitalized and
amortized straight line over the estimated period of sale for each product,
commencing in the year that sales of the product are first made. To date, we
have not capitalized any such expenditures other than certain IPR&D & IP
recorded in connection with certain acquisition or equity transactions.



Income Taxes




We account for income taxes under the asset and liability method. Deferred tax
assets and liabilities are recognized for 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 the 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 includes the
enactment date. Management considers many factors when assessing the likelihood
of future realization of deferred tax assets, including recent earnings
experience by jurisdiction, expectations of future taxable income, and the
carryforward periods available for tax reporting purposes, as well as other
relevant factors. A valuation allowance may be established to reduce deferred
tax assets to the amount that management believes is more likely than not to be
realized. Due to inherent complexities arising from the nature of the business,
future changes in income tax law and variances between actual and anticipated
operating results, management makes certain judgments and estimates. Therefore,
actual income taxes could materially vary from these estimates.



On December 22, 2017, The Tax Cuts and Jobs Act was signed into law and has
resulted in significant change to the U.S corporate income tax system. These
changes include a federal statutory rate reduction from 34% to 21%, a transition
tax, which applies to the repatriation of foreign earnings and profits, the
elimination or reduction of certain domestic deductions and credits and
limitations on the deductibility of interest expense and executive compensation.



                                       51

Changes in tax rates and tax laws are accounted for in the period of enactment.





We recognize in the financial statements the impact of a tax position, if that
position is more likely than not to be sustained upon an examination, based on
the technical merits of the position. We record a liability for the difference
between the benefit recognized and measured and the tax position taken or
expected to be taken on our tax return. To the extent that the assessment of
such tax positions changes, the change in estimate is recorded in the period in
which the determination is made. To the extent interest and penalties are not
assessed with respect to uncertain tax positions, amounts accrued will be
reduced and reflected as a reduction of the overall income tax provision. We
have incurred no liability and, therefore, did not need to record interest and
penalties during the year ended September 30, 2021 and 2020.



Foreign Currency



Items included in the financial statements are measured using their functional
currency, which is the currency of the primary economic environment in which the
company operates. The Company's consolidated financial statements are presented
in United States Dollar ("USD"), which is the company's functional and
presentational currency.



Net Loss per Share



Basic net loss per share is computed by dividing net loss available to common
shareholders by the weighted average number of common shares outstanding during
the period. Diluted net loss per share includes potentially dilutive securities
such as outstanding options and warrants, using various methods such as the
treasury stock or modified treasury stock method in the determination of
dilutive shares outstanding during each reporting period.



The following table sets forth potential common shares issuable upon the
exercise of outstanding options, the exercise of warrants and conversion of loan
notes, all of which have been excluded from the computation of diluted weighted
average shares outstanding as they would be anti-dilutive, including the impact
on dilutive net loss per share of in-the-money warrants:



                                                                September 30,       September 30,
                                                                    2021                2020
Stock options                                                        3,648,675           3,210,050
Warrants                                                             1,926,501           1,926,501
Convertible Notes                                                   82,487,678           1,562,319
Total shares issuable upon exercise or conversion                   88,062,854           6,698,870




Convertible  Notes



Debt Discount



The Company issued certain convertible notes that have certain embedded
derivatives and/or required bifurcation. In connection with these features, the
Company has recorded a discount to the debt that will be accreted to the face
value of the note under the effective interest method over the term of the

note.



                                       52

Fair Value of Financial Instruments





Fair value is defined under FASB ASC Topic 820 as the exchange price that would
be received for an asset or paid to transfer a liability (an exit price) in the
principal or the most advantageous market for an asset or liability in an
orderly transaction between participants on the measurement date. Valuation
techniques used to measure fair value must maximize the use of observable inputs
and minimize the use of unobservable inputs. The standard describes a fair value
hierarchy based on the levels of inputs, of which the first two are considered
observable and the last unobservable, that may be used to measure fair value.
The levels are as follows:

? Level 1 - Quoted prices in active markets for identical assets or liabilities


? Level 2 - Inputs other than Level 1 that are observable, either directly or
indirectly, such as quoted prices for similar assets or liabilities; quoted
prices in markets that are not active; or other inputs that are observable or
corroborated by observable market data for substantially the full term of the
assets or liabilities

? Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the value of the assets or liabilities.





The following is a listing of the Company's liabilities required to be measured
at fair value on a recurring basis and where they are classified within the fair
value hierarchy as of September 30, 2021:



                        Level 1       Level 2      Level 3       Total
Derivative Liability   $       -     $       -     $ 38,018     $ 38,018




Equity-Based Payments



ASC Topic 718 "Compensation-Stock Compensation" requires companies to measure
the cost of employee services received in exchange for the award of equity
instruments based on the estimated fair value of the award at the date of grant.
The expense is to be recognized over the period during which an employee is
required to provide services in exchange for the award. We account for shares of
common stock, stock options and warrants issued to employees based on the fair
value of the stock, stock option or warrant, if that value is more reliably
measurable than the fair value of the consideration or services received.



We account for stock-based compensation awards issued to non-employees under
Financial Accounting Standards Board ("FASB") Accounting Standards Codification
("ASC") No. 718-10, Compensation - Stock Compensation - Overall, and uses the
Black-Scholes Merton option-pricing model to determine the fair value of such
awards. The Company values awards issued to non-employees on the grant date and
has elected to estimate forfeitures as they occur and uses the simplified method
to estimate the term of such awards. The Company recognizes stock-based
compensation expense related to non-employee awards on a straight-line basis
over the service period.



                                       53

Recent Accounting Pronouncements


In August 2020, the FASB issued ASU 2020-06, which simplifies the guidance on
the issuer's accounting for convertible debt instruments by removing the
separation models for (1) convertible debt with a cash conversion feature and
(2) convertible instruments with a beneficial conversion feature. As a result,
entities will not separately present in equity an embedded conversion feature in
such debt and will account for a convertible debt instrument wholly as debt,
unless certain other conditions are met. The elimination of these models will
reduce reported interest expense and increase reported net income for entities
that have issued a convertible instrument that is within the scope of ASU
2020-06. Also, ASU 2020-06 requires the application of the if-converted method
for calculating diluted earnings per share and treasury stock method will be no
longer available. ASU 2020-06 is applicable for fiscal years beginning after
December 15, 2021, with early adoption permitted no earlier than fiscal years
beginning after December 15, 2020. The Company does not intend to early adopt
and continues to evaluate the impact of the provisions of ASU 2020-06 on its
consolidated financial statements.



In December 2019, the FASB issued ASU 2019 -12, Income Taxes - Simplifying the
Accounting for Income Taxes ("ASU 2019-12"). Among other items, the amendments
in ASU 2019-12 simplify the accounting treatment of tax law changes and
year-to-date losses in interim periods. An entity generally recognizes the
effects of a change in tax law in the period of enactment; however, there is an
exception for tax laws with delayed effective dates. Under current guidance, an
entity may not adjust its annual effective tax rate for a tax law change until
the period in which the law is effective. This exception was removed under ASU
2019-12, thereby providing that all effects of a tax law change are recognized
in the period of enactment, including adjustment of the estimated annual
effective tax rate. Regarding year-to-date losses in interim periods, an entity
is required to estimate its annual effective tax rate for the full fiscal year
at the end of each interim period and use that rate to calculate its income
taxes on a year-to-date basis. However, current guidance provides an exception
that when a loss in an interim period exceeds the anticipated loss for the year,
the income tax benefit is limited to the amount that would be recognized if the
year-to-date loss were the anticipated loss for the full year. ASU 2019-12
removes this exception and provides that, in this situation, an entity would
compute its income tax benefit at each interim period based on its estimated
annual effective tax rate. ASU 2019-12 is effective for fiscal years beginning
after December 15, 2020, including interim periods within those annual periods.
Early adoption is permitted. The Company is currently evaluating the effect that
this update will have on its financial statements and related disclosures.

The Company has determined that all other recently issued accounting pronouncements will not have a material impact on its consolidated financial position, results of operations and cash flows, or do not apply to its operations.





Results of Operations

The following paragraphs set forth our results of operations for the periods presented. The period-to-period comparison of financial results is not necessarily indicative of future results.

Results of Operations for the years ended September 30, 2021 and 2020





Revenues

There were no revenues for the year ended September 30, 2021, and 2020 because we do not have any commercial biopharmaceutical products.





Operating Expenses



Operating expenses consisting of consultancy fees, legal and professional fees
and general and administrative expenses for the year ended September 30, 2021
decreased to $247,814 from $5,428,858 for the year ended September 30, 2020, a
decrease of $5,181,044. The decrease is primarily attributable to the impairment
and write off of goodwill and intangible assets of $4,872,354 offset by the pace
of development of the LSD1 and NPM1 projects which decreased while the direction
of the programs were being evaluated based on results achieved so far, along
with a decrease in general administrative costs driven by our decreased
activity.



Net Loss



Net loss for the year ended September 30, 2021 decreased to $875,998 from
$5,346,672 for the year ended September 30, 2020, a decrease of $4,470,674. The
decrease was due to the impairment and write off of goodwill and intangible
assets of $4,872,354 offset by increases in costs due to the accretion of debt
discount and other promissory note costs, decreases in the pace of development
of the LSD1 and NPM1 projects which decreased while the direction of
the programs are being evaluated, along with a decrease in general
administrative costs driven by our decreased activity.



                                       54

Liquidity and Capital Resources


On November 12, 2019 we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $57,500 in cash, which we received in November 2019.
As at the date of filing this note is in default. The Company is currently
negotiating an extension to the maturity date along with amended terms.



On February 7, 2020, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $31,000 in cash, which we received in February 2020.

On March 20, 2020, we entered into a 12% Convertible Promissory Note with a Holder pursuant to which we issued a Convertible Promissory Note to the Holder. The Holder provided us with $20,000 in cash, which we received in March 2020.





On September 22, 2020, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $35,000 in cash, which we received in September
2020.



On October 21 2020, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $40,000 in cash, which we received in January 2021.



On January 12, 2021, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $60,000 in cash, which we received in January 2021.



On February 23, 2021, we entered into a 12% Convertible Promissory Note with a
Holder pursuant to which we issued a Convertible Promissory Note to the Holder.
The Holder provided us with $90,000 in cash, which we received in February 2021.



On May 25, 2021, we entered into a 1% Convertible Promissory Note with a Holder
pursuant to which we issued a Convertible Promissory Note to the Holder. The
Holder provided us with $100,000 in cash, which we received in May 2021.



We will be required to raise additional capital to continue the development and
commercialization of current product candidates and to fund operations. We
cannot be certain that additional funding will be available on acceptable terms,
or at all. To the extent that we raise additional funds by issuing equity
securities, our shareholders may experience significant dilution. Any debt
financing, if available, may (i) involve restrictive covenants that impact our
ability to conduct, delay, scale back or discontinue the development and/or
commercialization of one or more product candidates; (ii) seek collaborators for
product candidates at an earlier stage than otherwise would be desirable and on
terms that are less favorable than might otherwise be available; or
(iii) relinquish or otherwise dispose of rights to technologies, product
candidates or products that we would otherwise seek to develop or commercialize
its self on unfavorable terms.



Capital Resources

The following table summarizes total current assets, liabilities and working capital as of the periods indicated:





                              September 30,       September 30,
                                  2021                2020            Change
Current assets               $        44,577     $        32,630     $  11,947
Current liabilities          $     2,798,389     $     2,707,632     $  91,207
Working capital deficiency   $    (2,753,812 )   $    (2,675,002 )   $ (78,810 )

We had a cash balance of $10,848 and $14,241 as of September 30, 2021 and September 30, 2020, respectively.





                                       55





Liquidity



The following table sets forth a summary of our cash flows for the periods
indicated:



                                                         For the             For the
                                                       year ended          year ended
                                                      September 30,       September 30,       Increase/
                                                          2021                2020           (Decrease)

Net cash used in operating activities                $      (293,393 )   $      (251,327 )   $   (42,066 )
Net cash used in investing activities                $             -     $             -     $         -
Net cash provided by financing activities            $       290,000     $ 

     215,500     $    74,500

Net Cash Used in Operating Activities





Net cash used in operating activities was $293,393 for the year ended September
30, 2021 compared to $251,327 for the year ended September 30, 2020. The change
is principally attributable to net loss of $785,082 excluding non-cash items
such as share based compensation of $42,673, fee charges related to convertible
notes of $123,718, Tiziana loan interest of $5,760, accretion of beneficial
conversion feature and debt discount of $545,594, a gain on troubled debt
restructuring of $11,773 and changes in operating assets and liabilities of
$32,765 for the year ended September 30, 2021 as compared to a net loss of
$5,346,672 excluding non-cash items such as share based compensation of
$134,632, an impairment of goodwill and intangible assets of $4,872,354 and
changes in operating assets and liabilities of $48,320 for the year
ended September 30, 2020

Net Cash Provided by Financing Activities

Net cash provided by financing activities consists of proceeds from the issuance of convertible notes of $290,000 during the year ended September 30, 2021 compared to proceeds from the issuance of a convertible notes and a related party loan payable of $215,500 during the year ended September 30, 2020.

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