25 January 2023 News Small Pharma Reports Fiscal Third Quarter 2023 Highlights – Positive top-line results from Phase IIa trial of SPL026 in Major Depressive Disorder – New SPL026 trials underway and screening commenced in the first in-human study of SPL028 January 25, 2023 – London, United Kingdom – Small Pharma Inc. (TSXV: DMT) (OTCQB: DMTTF) (the “Company” or “Small Pharma”), a biotechnology company focused on short-duration psychedelic-assisted therapies for mental health conditions, has today published its financial results for the three and nine months ended November 30, 2022. A full copy of the financial results can be found under the Company’s profile on SEDAR at www.sedar.com. Unless otherwise indicated, all currency references are in Canadian dollars. Financial Highlights (including post-period events): Cash on hand as of November 30, 2022 was $22.7 million. Cash is net of an unrealized foreign exchange loss of $2.3 million due to a strengthening of the Canadian dollar against the British pound sterling (“GBP”) during the 9 months ended November 30, 2022; however, as most of the Company’s operating costs are incurred in GBP, the loss has little impact on the underlying cash burn of the Company. Cash used in operating activities was $5.4 million for the three months ended November 30, 2022. Operating expenses for the three months ended November 30, 2022 were $7.2 million. 1,788,000 common shares purchased and cancelled to date through the normal course issuer bid. Recent Operational Highlights (including post-period events): Ultra Short-Duration Psychedelic Program Phase IIa trial investigated the safety and efficacy of intravenous (“IV”) SPL026, with supportive therapy, in 34 patients with moderate/severe Major Depressive Disorder (“MDD”). SPL026 demonstrated a rapid and durable antidepressant response, and a statistically significant and clinically relevant reduction in depressive symptoms versus placebo, as measured by the Montgomery-sberg Depression Rating Scale (“MADRS”). Primary endpoint met with a statistically significant -7.4 point difference between SPL026 (21.5mg) and placebo at two-weeks post-dose, as measured by MADRS change from baseline (p=0.02). Antidepressant effect of SPL026 with supportive therapy demonstrated a rapid onset at one-week post-dose with a statistically significant difference in MADRS of -10.8 versus placebo (p=0.002). Durable antidepressant effect with a 57% remission* rate at 12-weeks following a single SPL026 dose with supportive therapy. No apparent differences identified in antidepressant effect between a one and two dose regimen of SPL026. Favourable safety and tolerability profile demonstrated with no drug-related serious adverse events reported. All adverse events related to treatment were considered mild or moderate. Preparations for Phase IIb international multi-site clinical trial of SPL026 in MDD continues, with anticipated initiation in H1 2023. Dosing commenced in December 2022 in Phase Ib drug interaction study which aims to assess the interaction between selective serotonin reuptake inhibitors (“SSRIs”) and SPL026 in patients with MDD. The open-label study will investigate the safety, tolerability, pharmacokinetics (“PK”), pharmacodynamics (“PD”) and exploratory efficacy of SPL026, alone or in combination with SSRIs. Short-Duration Psychedelic Programs First patient dosed in January 2023 in the Phase I study exploring intramuscular (“IM”) administration of SPL026. The study aims to compare the safety, tolerability, PK and PD of SPL026 delivered via IM versus IV administration in healthy volunteers. Participant screening has commenced in the Phase I study evaluating the safety, tolerability, PK and PD of SPL028, deuterated DMT with supportive therapy. Additional Activities SPL026 drug candidate to be provided in support of a University College London (“UCL”) led neuroplasticity brain-imaging study, seeking to explore the impact of DMT-induced brain changes on cognition, behaviour, and well-being. The Understanding Neuroplasticity Induced by Tryptamines Project (the “UNITy Project”) will use Functional Magnetic Resonance Imaging (fMRI) to image the brain before, during and after a DMT or placebo infusion. Corporate Activity Continued expansion of Intellectual Property portfolio with patents granted across each of the Company’s core areas of patent protection. Three new patents granted in fiscal Q3 increasing the total to 14 granted patents and over 90 applications pending, including: Second U.S. patent granted, protecting the therapeutic composition of a small group of deuterated DMT compounds, with expected lifetime of exclusivity until April 2041. European patent granted protecting a manufacturing process for the preparation of synthetic DMT, DMT-related compounds and deuterated DMT analogs, including pipeline candidates SPL026 and SPL028. The Company has entered into a new services agreement dated January 24, 2023 (the “Agreement”)with Native Ads, Inc. (“Native Ads”), pursuant to which Native Ads will primarily be tasked with providing content development, media buying and distribution, and campaign reporting services (collectively, the “Services”). The Agreement will commence on January 25, 2023, for an expected period of six months. Native Ads will receive a cash fee of USD $25,000 for the Services. The Company and Native Ads act at arm’s length and to the knowledge of the Company, Native Ads nor any of its directors or officers currently own any securities of the Company. Native Ads has agreed to comply with all securities laws and policies of the TSX Venture Exchange (“TSXV”) and the OTC Markets Group Inc. in providing the Services. No stock options or other securities-based compensation are being granted in connection with the Agreement. The Agreement remains subject to the prior acceptance and approval of the TSXV. George Tziras, Chief Executive Officer of Small Pharma, said: The positive SPL026 Phase IIa results provide us with confidence in advancing the SPL026 clinical development program and our portfolio of short-duration mental health treatments. In the third fiscal quarter we made strong progress across our clinical trials, with two new SPL026 studies now underway and patient screening initiated in our first in-human trial with SPL028. In the first half of 2023, we will be focused on advancing these programs with momentum and preparing to launch our international Phase IIb trial for SPL026 in a larger MDD population.” About the SPL026 in MDD Phase IIa study The two-staged Phase IIa study investigated the efficacy and safety of IV SPL026, with supportive therapy, in 34 moderate/severe MDD patients. This included a blinded, randomized, placebo-controlled phase where the primary endpoint was to assess the efficacy of a single 21.5mg dose of SPL026 with supportive therapy, versus placebo with therapy, at two-weeks post-dose. All study participants were then enrolled into an open-label phase, where they received a single 21.5mg dose of SPL026 with supportive therapy, and were followed-up for a further 12-weeks. Efficacy was assessed using MADRS, a widely used and accepted scale for assessing depression severity, and assessments were made by blinded independent raters. About Small Pharma Small Pharma is a biotechnology company progressing a pipeline of short-duration psychedelic-assisted therapies for the treatment of mental health conditions. The Company’s current focus is on exploring new therapeutic approaches for depression. Small Pharma’s lead candidate, SPL026, is a proprietary synthetic formulation of DMT. The Company is advancing clinical programs of SPL026 and SPL028 with supportive therapy for the treatment of mental health conditions, and was granted an Innovation Passport designation from the U.K. Medicines and Healthcare products Regulatory Agency (the “MHRA”) for IV SPL026 with supportive therapy for MDD. In addition, Small Pharma has a pipeline of proprietary preclinical assets in development. About Native Ads Native Ads is a full-service advertising firm based in New York that owns and operates a proprietary ad exchange with over 80 integrated supply side platforms resulting in access to three to seven billion daily North American ad impressions. Notes: *remission = MADRS score ≤10 For further information contact: Small Pharma Inc. George Tziras, Chief Executive Officer Email: ir@smallpharma.co.uk Tel: +1 (646) 751-4363 Investor Relations: Eric Ribner LifeSci Advisors Email: eric@lifesciadvisors.com Tel: +1 (646) 889-1200 Media Relations Jaber Mohamed MHP Communications Email: smallpharma@mhpc.com Tel: +44 (0)7720 326 847 Cautionary Note Regarding Forward-Looking Statements This press release contains statements that constitute “forward-looking information” (“forward-looking information”) within the meaning of the applicable Canadian securities legislation. All statements, other than statements of historical fact, are forward-looking information and are based on expectations, estimates and projections as at the date of this news release. Any statement that discusses predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information. Forward-looking statements in this news release include statements regarding the Company’s Phase IIa study of SPL026, including the anticipated impact of the results; impact of further analysis of the top-line SPL026 trial data on assumptions made based on top-line data; the anticipated commencement, timing and design of the Company’s Phase IIb international multi-site trial of SPL026; the Company’s Phase Ib drug interaction study assessing the interaction between SSRIs and SPL026 in patients with MDD, including the intended trial design and impact, the Phase I study exploring IM administration of SPL026, including the trial design and impact, the anticipated commencement, timing and design of the Phase I study of SPL028 evaluating deuterated DMT with supportive therapy; the provision of SPL026 to the University College London in connection with the UNITy Project; the protections and exclusivity afforded by the Company’s patents granted in Q3; the Agreement with Native Ads, including the Services to be provided and approval of the TSXV; and the Company’s ability to progress short-duration psychedelic assisted therapies for the treatment of mental health conditions. In disclosing the forward-looking information contained in this press release, the Company has made certain assumptions. Although the Company believes that the expectations reflected in such forward-looking information are reasonable, it can give no assurance that the expectations of any forward-looking information will prove to be correct. Known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking information. Such factors include, but are not limited to: compliance with extensive government regulations; domestic and foreign laws and regulations adversely affecting the Company’s business and results of operations; the impact of COVID-19; and general business, economic, competitive, political and social uncertainties. Accordingly, readers should not place undue reliance on the forward-looking information contained in this press release. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward-looking information to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward-looking information or otherwise. Small Pharma makes no medical, treatment or health benefit claims about its proposed products. The MHRA or other similar regulatory authorities have not evaluated claims regarding DMT-assisted therapies and other next generation psychoactive compounds. The efficacy of such therapies has not been confirmed by MHRA-approved research. There is no assurance that such DMT-assisted therapies and other psychoactive compounds can diagnose, treat, cure or prevent any disease or condition. Vigorous scientific research and clinical trials are needed. Any references to quality, consistency, efficacy and safety of potential therapies do not imply that Small Pharma verified such in clinical trials or that Small Pharma will complete such trials. If Small Pharma cannot obtain the approvals or research necessary to commercialize its business, it may have a material adverse effect on Small Pharma’s performance and operations. The TSX Venture Exchange (“TSXV”) has neither approved nor disapproved the contents of this news release. Neither the TSXV nor its Regulation Services Provider (as that term is defined in the policies of the TSXV) accepts responsibility for the adequacy or accuracy of this release. Company Updates