Full Press Release Details
MANAGEMENT'S DISCUSSION AND ANALYSIS
This management's discussion and analysis
("MD&A") relates to the operations and financial condition of Optimi Health Corp. ("Optimi" or the "Company") and is dated as of May 29, 2026 and the MD&A describes the operating
and financial results of the Company for the period ended March 31, 2026, and 2025. The MD&A supplements, but does not form part of, the condensed interim consolidated financial statements of the Company, and should be read in conjunction
with the Company's condensed interim consolidated financial statements and related notes for the period ended March 31, 2026, and 2025 and audited financial statements for the year ended September 30, 2025, and 2024. The Company
prepares and files its condensed interim consolidated financial statements in accordance with International Financial Reporting Standards ("IFRS"). The currency referred to in this MD&A is in Canadian Dollars.
Certain information included in the MD&A is forward-looking and based upon assumptions and anticipated results that are subject to uncertainties. Should
one or more of these uncertainties materialize or should the underlying assumptions prove incorrect, actual results may vary significantly from those expected. See "Cautionary Statement Regarding Forward-Looking Statements" for
On May 19, 2026, the Company executed a 1 for 30 reverse stock split of all outstanding common shares, warrants, stock options,
RSRs, and convertible debentures. All references to share and per-share information, warrants, stock options, RSRs, and convertible debentures in this MD&A have been adjusted to reflect the effects of the
Reverse Stock Split. No fractional shares were issued, and all fractional balances were rounded.
The Company is a Health Canada licensed, Good Manufacturing Practices ("GMP") certified, end-to-end pharmaceutical drug manufacturer specializing in controlled substances, specifically MDMA and botanical psilocybin. With a vertically integrated approach, Optimi owns and operates two purpose built
10,000-square-foot licensed production sites in Princeton, British Columbia and holds a Drug Establishment Licence ("DEL"), as issued by Health Canada. Optimi's DEL certifies that its
facility and Quality Management Systems comply with Canadian GMP for the formulation of designated drug products and the manufacture of certain active pharmaceutical ingredients ("API") from plant sources. Additionally, Optimi holds a
Dealer's Licence under Canada's Narcotic Control Regulations, allowing the Company to possess, produce, assemble, sell and deliver psilocybin and other psychedelic substances within the regulated framework set forth by Health Canada. The
Dealer's Licence allows Optimi to possess up to 20kg of psilocybin and 200g of psilocin (equivalent to approximately 2,000kg of dried full-body psilocybin-containing mushrooms) and 2kg of MDMA. Optimi holds a Precursor Licence under
Canada's Precursor Regulations allowing the Company to import 3,4-METHYLENEDIOXYPHENYL-2-PROPANONE, which can be used in
the synthesis of MDMA.
Optimi's DEL enables it to supply validated psilocybin API, psilocybin drug products and MDMA drug products to patients in
Australia under the Authorised Prescriber Scheme and globally. With Health Canada being a participant in several Mutual Recognition Agreements ("MRAs"), Optimi's GMP-certified products are
positioned for international distribution. Through strategic collaborations and ongoing compliance with global regulatory authorities, the Company aims to expand its product offerings to new jurisdictions where psychedelic-assisted therapies are
gaining regulatory approval.
The key differentiator of a DEL is that it enables Optimi's GMP MDMA and psilocybin capsules to be prescribed by
authorized physicians in Australia for the treatment of Post Traumatic Stress Disorder ("PTSD") and Treatment Resistant Depression ("TRD"). Unlike most companies in the psychedelic sector that remain in clinical or pre-commercial phases, Optimi is currently supplying regulated medicines under prescription - supported by a DEL that also permits the legal manufacture, and international export of both products.
As part of Optimi's commitment to innovation and broadening accessibility to psychedelic-based therapies, the Company is continuously refining its
production methodologies, investing in advanced cultivation and extraction technologies and enhancing its regulatory compliance frameworks to establish best practices for the pharmaceutical drug manufacturing of its novel formulations. By
prioritizing sustainable and responsible production practices, Optimi is dedicated to becoming a global leader in the psychedelic pharmaceutical sector. Optimi's research initiatives focus on optimizing extraction efficiency, improving
formulation stability and ensuring scalable manufacturing techniques that align with future market expansion plans.
Drug Establishment License ("DEL"): the Company was awarded a Drug Establishment License
on May 24th, 2024. Securing a DEL positions the Company as a pharmaceutical company with a strong portfolio of government approved licenses for controlled substances. As Health Canada is a
participant to several Mutual Recognition Agreements (MRAs) covering drug/medicinal products for global distribution, the Company is now recognized globally for the GMP production of its psilocybin and MDMA formulations. The DEL differentiates the
Company from other psychedelic manufacturers in the space and enables the Company to provide competitively priced products within the GMP psychedelics market; conduct research and development with in-house
scientific and quality teams; and provides flexibility to adapt to international licensing demands and changes in legislation. Importantly, having a DEL enables Optimi to be one of the only licensed, psychedelic pharmaceutical manufacturers in the
world permitted to export to the Australian Marketplace and supply the country's Authorized Prescriber program. As part of the Authorized Prescriber program in Australia, authorized Psychiatrists are able to prescribe MDMA assisted therapy for
patients suffering from PTSD and Psilocybin Assisted therapy for patients suffering from TRD. All products supplied to the Authorized Prescriber Program should be certified GMP as per the Therapeutic Goods Administration (TGA). Health
Canada is only allowing Canadian companies with a DEL to be issued export permits to supply Australia.
Having a DEL will allow Optimi to offer its
products into new international markets as regulations evolve.
Mind Medicine Australia: On February 28, 2023, the Company received signed
purchase orders from Mind Medicine Australia Limited which it accepted with the intent of ensuring that patients in Australia with treatment resistant PTSD have access to medical grade GMP MDMA and patients with treatment resistant depression have
access to GMP encapsulated psilocybin as part of prescribed assisted therapy administered by authorized psychiatrists. A long-term distribution agreement with Mind Medicine Australia Limited was also entered into, which is facilitating the
distribution of Optimi's products through a lead pharmaceutical distribution company and registered pharmacy networks in each State and Territory of Australia with full compliance with regulatory requirements in each jurisdiction. MDMA and
psilocybin drug candidates have been encapsulated and packaged inside the Company's Health Canada Licensed Facility in compliance with GMP standards and the first shipment of MDMA was fulfilled in August 2024 and deliveries have continued
through fiscal 2025 and 2026.
Optimi Labs Inc.: The Company has acquired various analytical instrumentation which will facilitate rapid expansion
of its research and development activities as well as ramp up in-house productivity and testing capabilities. With this equipment, the Company will be able to produce assays which includes potency testing via
high-performance liquid chromatography including a diode array detector that allows for measuring multiple substances at multiple wavelengths (or components) simultaneously. Additional capabilities include stability and identity testing
utilizing thin layer chromatography, ultraviolet-visible spectroscopy, and mass spectrometry.
The equipment includes stability chambers, a GC-MS-FID, an automatic capsule filler, back up HPLCs, equipment to support Optimi's ICP-MS, back up equipment for formulating
and all requisite equipment for conducting full panel microbial testing on its products. Upon installation of this equipment, Optimi will be in the position to conduct in-house analytical testing to produce a
complete certificate of analysis ("COA") for its psychedelic products and to begin full scale cannabis testing for licensed cannabis producers.
Results of Operations
Six-Month Period Ended March 31, 2026
During the six-month period ended March 31, 2026, the Company generated a net loss of $3,145,846. The main factors
that contributed to the loss in the fiscal period were amortization expense of $491,528, bank charges and interest of $515,565, consulting of $537,527, and wages and benefits of $530,031.
During the period ended March 31, 2026, the Company earned revenue of $99,500 from sale of drug products. The Company received an additional $120,000
deposit from a customer for sales fulfilled in the third quarter.
Subsequent to March 31, 2026, the Company:
Period Ended March 31, 2025
During the six-month period ended March 31, 2025, the Company generated revenue of $293,941 and a net loss of
$1,455,346. The main factors that contributed to the loss in the fiscal period were amortization expense of $453,021, consulting of $416,504, research and development costs of $201,998, and wages and benefits of $619,003 offset by debt forgiveness
recovery of $903,951 related to certain directors forgiving debts owed from the Company.
During the period ended March 31, 2025, the Company
received $395,000 in proceeds from a private placement.
During the period ended March 31, 2025, the Company received debt forgiveness of $903,951
from related parties.
Selected Financial Information
The following table sets forth selected financial information with respect to the Company's condensed interim consolidated financial statements for the
period ended March 31, 2026, and 2025.
| Period ended March 31, 2026 | Period ended March 31, 2025 | |||||||
| Operations: | ||||||||
| Revenue | 99,500 | $ | 293,941 | |||||
| Expenses | $ | 3,242,538 | $ | 2,580,889 | ||||
| Interest and other income | $ | 7,228 | $ | 7,422 | ||||
| Loss and comprehensive loss | ($ | 3,145,846 | ) | ($ | 1,455,346 | ) | ||
| Loss per share (basic and diluted) | ($ | 0.98 | ) | ($ | 0.46 | ) | ||
| Assets: | ||||||||
| Current Assets | $ | 558,568 | $ | 841,059 | ||||
| Non-Current Assets | $ | 12,951,108 | $ | 12,880,145 | ||||
| Total Assets | $ | 13,509,676 | $ | 13,721,204 | ||||
| Liabilities: | ||||||||
| Current Liabilities | $ | 9,828,019 | $ | 3,256,016 | ||||
| Non-Current Liabilities | $ | 143,211 | $ | 1,821,500 | ||||
| Total Liabilities | $ | 9,971,230 | $ | 5,077,516 | ||||
| Shareholders' Equity | $ | 3,538,446 | $ | 8,643,688 | ||||
| Total Liabilities and Shareholders' Equity | $ | 13,509,676 | $ | 13,721,204 |
Selected of Quarterly Results
| Quarter | March 31, 2026 | December 31, 2025 | September 30, 2025 | June 30, 2025 | ||||||||||||
| Loss for the period | $ | 1,591,871 | $ | 1,553,975 | $ | 1,349,367 | $ | 907,318 | ||||||||
| Loss per share | $ | (0.49 | ) | $ | (0.48 | ) | $ | (0.42 | ) | $ | (0.28 | ) | ||||
| Total assets | $ | 13,509,676 | $ | 14,236,203 | $ | 15,212,645 | $ | 14,135,865 | ||||||||
| Total liabilities | $ | 9,971,230 | $ | 9,219,190 | $ | 8,641,984 | $ | 6,383,375 | ||||||||
| Quarter | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | ||||||||||||
| Loss for the period | $ | 196,366 | $ | 1,258,980 | $ | 1,723,183 | $ | 1,626,757 | ||||||||
| Loss per share | $ | (0.06 | ) | $ | (0.40 | ) | $ | (0.58 | ) | $ | (0.55 | ) | ||||
| Total assets | $ | 13,721,204 | $ | 14,004,097 | $ | 14,551,035 | $ | 15,064,293 | ||||||||
| Total liabilities | $ | 5,077,516 | $ | 5,364,540 | $ | 4,975,323 | $ | 4,399,532 |
Liquidity and Capital Resources
As at March 31, 2026, the Company had a working capital deficiency of $9,269,451. Subsequent to the period ended March 31, the Company raised
approximately CAD$18.4 million in net proceeds from its Nasdaq Capital Market public offering.
The Company had negative cash flow of $970,308 from
operating activities during the period ended March 31, 2026. During the period ended March 31, 2026, the Company spent $14,754 on plant and equipment additions, $12,900 on payments of lease obligations and $27,492 in deferred financing
The Company's future capital requirements will depend upon many factors including, without limitation, its ability to produce, market and
sell its products, consumer demand for its products, the Company's ability to secure required financing, and in the event consumer demand is strong for its products, the Company's ability to expand its business to facilitate this demand.
The Company has limited capital resources and has historically relied upon the sale of equity securities for cash required for research and development purposes, for acquisitions and to fund the administration of the Company. The Company intends to
finance its future requirements through a combination of debt and/or equity issuances. There is no assurance that the Company will be able to obtain such financings or obtain them on favorable terms. These uncertainties cast significant doubt on the
Company's ability to continue as a going concern. The audited consolidated financial statements do not include any adjustments related to the recoverability of assets and classification of liabilities that might be necessary should the Company
be unable to continue as a going concern. Such adjustments could be material.
Off-Balance Sheet Arrangements
The Company has no off-balance sheet arrangements.
Key Management Compensation and Related Party Transactions
During the periods ended March 31, 2026, and 202, the Company incurred the following amounts charged by officers and directors (being key management
personnel) and companies controlled and/or owned by officers and directors of the Company in addition to the related party transactions disclosed elsewhere in these consolidated financial statements:
| March 31, 2026 $ | March 31, 2025 $ | |||||||
| Consulting fees | 277,645 | 305,234 | ||||||
| Share-based compensation | 34,277 | - | ||||||
| 311,922 | 305,234 |
The Company has entered into a lease agreement with BC Green, as described in Note 7 of the condensed interim
consolidation financial statements.
As at March 31, 2026, there was $1,658,461 (September 30, 2025-$524,326) owing to key management, which is
included in due to related parties. The amounts are unsecured, without interest and due on demand.
During the period ended March 31, 2025, the
Company received debt forgiveness of $903,951 from related parties.
During the year ended September 30, 2023, the Company received $1,000,000 in
loan proceeds from a company controlled by a director (Note 11). As at March 31, 2026, the Company owed $1,000,000 (September 30, 2025-$1,000,000) in principal and $219,811 (September 30, 2025-$131,250) in accrued interest in
relation to this loan.
During the year ended September 30, 2025, the Company received $3,450,000 in loan proceeds from two companies controlled by
directors (Note 11). As at March 31, 2026, the Company owed $3,450,000 (September 30, 2025-$3,450,000) in principal and $356,315 (September 30, 2025 $96,175) in accrued interest in relation to this loan recorded in due to related parties.