Jupiter Neurosciences Signs Term Sheet For Exclusive U.S. Rights To PharmAla Biotech Holdings MDMA Drug Candidate ALA-002 In Deal Worth Over $100M Including Milestones And Royalties

PharmAla Biotech Holdings Inc. (CSE:MDMA, OTCQB:MDXXF) ("PharmAla" or the "Company"), a global leader in the research, development, and manufacturing of novel MDXX-class molecules, today announced that it has entered into a term sheet (the "Term Sheet") under which PharmAla would grant Jupiter Neurosciences, Inc. (NASDAQ:JUNS) ("Jupiter") exclusive, perpetual United States licensing rights to ALA-002, PharmAla's lead drug candidate and a next-generation, non-racemic MDMA Novel Chemical Entity. The total potential value of the proposed transaction is in excess of US$100 million through a combination of upfront consideration, development milestone payments, and single-digit royalties on net sales. PharmAla would retain all rights to ALA-002 in territories outside of the United States, including its existing commercial presence through its Cortexa joint venture in Australia.

Pursuant to the Term Sheet, PharmAla would receive upfront consideration of US$3.33 million at closing of the definitive agreement, comprised of US$1.50 million in cash and US$1.83 million in shares of Jupiter common stock, with such shares subject to a 10-day lock-up period. The Term Sheet additionally provides that further development milestone payments and royalties will be paid to PharmAla as the product is developed, approved, and commercialized in the United States. Closing of the definitive agreement, based on the terms and conditions set forth in the Term Sheet, is to occur no more than 90 days from the execution of the Term Sheet. Pursuant to the Term Sheet, Jupiter has agreed to deposit US$600,000 into an escrow account upon execution of the Term Sheet, which shall be credited against the upfront cash consideration payable to PharmAla at closing under the definitive agreement. If the definitive agreement is not executed within 90 days from signing of the Term Sheet, PharmAla shall receive all of the escrowed cash amount as a reverse termination fee, subject to fault-based carve-outs and exceptions as set forth in the escrow agreement.