Incannex Healthcare Cancels All Outstanding Series A Warrants Following Strategic ATM Execution Capital structure streamlined and potential dilution from Series A Warrants eliminated ahead of key Phase 2 clinical milesto

Incannex Healthcare Cancels All Outstanding

Series A Warrants Following Strategic ATM Execution

Capital structure streamlined and potential

dilution from Series A Warrants eliminated ahead of key Phase 2 clinical milestones

NEW YORK and MELBOURNE, Australia - June 12, 2025 -

Incannex Healthcare Inc. (Nasdaq: IXHL) ("Incannex" or the "Company"), a clinical-stage biopharmaceutical company

advancing combination drug therapies for high-impact indications, announces it has successfully cancelled all remaining Series A Warrants

pursuant to its letter agreements with the holders of the Series A Warrants, having raised the full amount of capital required to complete

the cancellation through its At-The-Market ("ATM") facility.

This follows the Company's May 28, 2025, announcement of binding

agreements to cancel the final 172 million Series A Warrants in exchange for $12.2 million. Combined with a tranche canceled earlier in

May, the initiative removes 347.2 million shares from potential future dilution, fully eliminating the Series A Warrant overhang.

Incannex CEO Joel Latham commented, "Following increased market liquidity, we specifically utilized our ATM facility to fund the

cancellation of all outstanding Series A Warrants. This eliminates a significant source of dilution and leaves Incannex with a clean capital

structure ahead of key milestones, including the upcoming topline data readout from our Phase 2 RePOSA trial of IHL-42X for obstructive

sleep apnea, expected in July 2025. This action reflects our commitment to disciplined capital management and long-term value creation

IHL-42X is being developed as a potential first-in-class oral therapy

for obstructive sleep apnea, a condition affecting millions globally with no FDA-approved drug treatment currently available.

For additional details, refer to the Company's Form 8-K filed

with the SEC on May 28, 2025.

IHL-42X is designed to treat obstructive sleep apnea ("OSA")

by targeting its underlying pathophysiology. An oral fixed-dose combination of dronabinol and acetazolamide, IHL-42X is currently advancing

through the RePOSA Phase 2/3 clinical trial, which is expected to enroll more than 560 patients at sites worldwide.

Designed to act synergistically, IHL-42X uniquely targets two physiological

pathways associated with the intermittent hypoxia ("IH") and hypercapnia that characterize OSA. In a prior Australian Phase

2 clinical trial, IHL-42X was shown to reduce the Apnea-Hypopnea Index ("AHI") in all dosage strengths, with the lowest dose

reducing AHI by an average of 51 percent relative to baseline. RePOSA, a global Phase 2/3 clinical trial is underway, evaluating IHL-42X

in individuals with OSA who are either non-compliant, intolerant, or na ve to positive airway pressure devices, including CPAP, with

the Phase 2 portion conducted in the United States. A topline readout from the U.S. Phase 2 portion is anticipated in July 2025.

Unlike weight loss therapies, IHL-42X is uniquely engineered to target

two key physiological pathways, intermittent hypoxia (IH) and hypercapnia, that underlie the pathology of OSA. By targeting these core

mechanisms, IHL-42X offers a differentiated approach that may benefit a wider range of patients, including the 67% of individuals with

OSA who are not classified as obese. OSA affects an estimated 1 billion people globally and approximately 30 million people in the United

States. Despite its high prevalence OSA remains significantly underdiagnosed and undertreated. IHL-42X has the potential to address this

critical gap in care and improve outcomes for millions living with this serious, chronic condition.

About Incannex Healthcare Inc.

Incannex is leading the way in developing combination medicines that

target the underlying biological pathways associated with chronic conditions, including obstructive sleep apnea, rheumatoid arthritis

and generalized anxiety disorder. The company is advancing three clinical-stage product candidates based on evidence-based innovation,

and supported by streamlined operations. Incannex's lead clinical program, IHL-42X, is an oral fixed-dose combination of dronabinol and

acetazolamide designed to target underlying mechanisms and act synergistically in the treatment of obstructive sleep apnea. In a Phase

2 development program, IHL-675A is an oral fixed-dose combination of cannabidiol and hydroxychloroquine sulfate designed to act synergistically

to alleviate inflammatory conditions, such as rheumatoid arthritis. Approved for Phase 2 clinical development, PSX-001 is an oral synthetic

psilocybin treatment for the treatment of generalized anxiety disorder. Incannex's programs target disorders that have limited, inadequate,

or no approved pharmaceutical treatment options. For additional information on Incannex, please visit our website at www.incannex.com.

Forward Looking Statements

This press release contains "forward-looking statements"

within the meaning of the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Examples of

forward-looking statements in this press release include statements about, among other things: Incannex's business strategy, future operations;

Incannex's judgements regarding the potential benefits from the cancellation of its Series A Warrants; Incannex's ability to execute

on its objectives, prospects, or plans, evaluations and judgments regarding Incannex's research and development efforts, including any

implications that the results of earlier clinical trials will be representative or consistent with later clinical trials or final results;

the expected timing of enrollment for these trials and the availability of data or results of these trials, and the potential benefits,

safety or of Incannex's drug candidates. Forward-looking statements are statements other than historical facts and relate to future events

or circumstances or Incannex's future performance, and they are based on management's current assumptions, expectations, and beliefs concerning

future developments and their potential effect on Incannex's business; Incannex's ability to potentially benefit from its improved

capital structure or to maintain or further improve its capital structure in the future. These forward-looking statements are subject

to a number of risks and uncertainties, which may cause the forward-looking events and circumstances described in this press release to

not occur, and actual results to differ materially and adversely from those described in or implied by the forward-looking statements.

These risks and uncertainties include, among others: the continued availability of financing; Incannex's ability to raise capital to fund

continuing operations, to complete capital raising transactions and to maintain or potentially further improve its capital structure;

the impact of any infringement actions or other litigation brought against Incannex; the success of Incannex's development efforts, including

Incannex's ability to progress its drug candidates through clinical trials on the timelines expected; competition from other providers

and products; that the market for its drug candidates may not grow at the rates anticipated or at all; Incannex's compliance with the

various evolving and complex laws and regulations applicable to its business and its industry; and Incannex's ability to protect its proprietary

technology and intellectual property; and other factors relating to Incannex's industry, its operations and results of operations. The

forward-looking statements made in this press release speak only as of the date of this press release, and Incannex assumes no obligation

to update publicly any such forward-looking statements to reflect actual results or to changes in expectations, except as otherwise required

by law. Incannex's reports filed with the U.S. Securities and Exchange Commission (SEC) including its annual report on Form 10-K for the

fiscal year ended June 30, 2024, filed with the SEC on September 30, 2024, and the other reports it files from time to time, including

subsequently filed annual, quarterly and current reports, are made available on Incannex's website upon their filing with the SEC. These

reports contain more information about Incannex, its business and the risks affecting its business, as well as its results of operations

for the periods covered by the financial results included in this press release. For additional information on Incannex, please visit

our website at www.incannex.com.

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