BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

This management’s discussion and analysis (“MD&A”) is provided to enable the reader to assess material changes in financial condition and results of operations of BioHEP Technologies Ltd (“BioHEP” or the “Company”) for the nine months ended October 31, 2017. This MD&A should be read in conjunction with the unaudited condensed interim financial statements of the Company for the nine months ended October 31, 2017, and the audited financial statements of the Company for the year ended January 31, 2017, prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). This MD&A complements and supplements, but does not form part of the Company’s financial statements.

This MD&A contains forward-looking statements. All forward-looking statements, including those not specifically identified herein, are made subject to cautionary language on page 8. Readers are advised to refer to the cautionary language when reading any forward-looking statements.

All dollar amounts contained herein are expressed in Canadian dollars unless otherwise indicated. This MD&A has been prepared as of December 27, 2017.

BUSINESS OVERVIEW

BioHEP Ventures Ltd. was incorporated under the British Columbia Business Corporations Act as a private company on February 11, 2014. On April 11, 2014, BioHEP completed a Plan of Arrangement (“Arrangement”) with Global Blockchain Technologies Corp. (“Global”) (formerly Carrus Capital Corporation). Under the terms of the Arrangement, BioHEP received substantially all of Global’s interest in the SB-9000 technologies with $nil carrying value, investment in Spring Bank Pharmaceuticals Inc. (“Spring Bank”) of $1,000 and $5,000 cash. As consideration for the SB-9000 technologies, BioHEP issued 2,845,378 common shares to Global, which was then distributed to the shareholders of Global pro-rata based on their relative shareholdings of Global. As a result of the Arrangement, the Company became a private bio-pharmaceutical reporting issuer.

On September 27, 2017 the Company closed an asset sale agreement (“Assignment Agreement”) entered into on April 21, 2017 between the Company and Exro Technologies Inc. (formerly BioDE Ventures Ltd.) (“BioDE”). Under the asset sale agreement, BioDE assigned to the Company a license agreement and certain patents for $450,000 which was paid by the Company by issuing 448,321 shares and $1,679 cash consideration.

HEPATITIS SB-9000 TECHNOLOGY

On April 11, 2014 the Company acquired a biotechnology license related to SB-9000 (formerly known as MX-1313), for the treatment for chronic HBV infection (the “Agreement”). The Acquisition of this license included an agreement with Spring Bank Pharmaceuticals Inc. (“Spring Bank”), a U.S. development stage company, whereby Spring Bank was granted the worldwide rights to a dinucleotide analogue compound (SB-9000). As consideration related to the original license granted to Spring Bank, Spring Bank issued 250,000 Series A non-voting, convertible preferred shares of Spring Bank and 12,500 common shares of Spring Bank. In addition, the Company may receive in the future, payments related to the Agreement aggregating US$3,500,000 upon the achievement of certain clinical development milestones and royalties on net sales and sublicensing revenues. Spring Bank is responsible for all development and related patent costs.

On February 1, 2016, the Company entered into an amended and restated license agreement with Spring Bank Pharmaceuticals, Inc. (“Spring Bank”) of Milford, MA (“New Agreement”). Under the amended and restated license agreement, BioHEP granted Spring Bank an exclusive worldwide license under certain patents and know-how to make, have made, use, sell, offer to sell and import certain product candidates comprising a novel phosphorothioate dinucleotide referred to as ORI-9020 and certain related compounds, for the diagnosis and/or treatment of all viral diseases and conditions. In exchange, Company received an additional 125,000 common shares (500,000 pre-reverse stock split) of Spring Bank and 125,000 share purchase warrants (500,000 pre-reverse stock split) with an exercise price of USD$16 per share (USD$4 pre-reverse stock split), expiring on August 1, 2018.

An income tax expense has been estimated based on the shares received in conjunction with the restated license being treated as a capital gain. The capital gain was applied at tax rate of 26% to the fair value of the shares received of $1,928,625. The fair value of the shares was determined to be $11.10 per share which is based on the closing price on May 6, 2016, when Spring Bank became publicly traded on the NASDAQ stock exchange.

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

As at October 31, 2017, deferred income tax liability of $641,653 has been estimated using the 2017 tax rate of 26% applied to the unrealized gain to date on shares classified as available for sale. During the nine months ended October 31, 2017, deferred income tax expense of $409,702 was recognized in the statement of comprehensive income.

On March 18, 2016, Spring Bank completed a 4-for-1 reverse stock split. Following the reverse split the Company owned 250,000 convertible preferred shares, 137,500 common shares and 125,000 warrants with an exercise price of USD$16 per share, expiring on August 1, 2018. The fair value of the shares was determined to be $11.10 per share which is based on the closing price on May 6, 2016 when the 250,000 convertible preferred shares were converted to 250,000 common shares and Spring Bank became publicly traded on the NASDAQ stock exchange. As part of a share capital restructuring, on May 6, 2016, the 250,000 convertible Spring Bank preferred shares were converted to 250,000 common shares.

During the nine months ended October 31, 2017, the Company sold 15,000 Spring Bank shares for net proceeds of $131,309 with an adjusted cost base of $74,696. A gain of $56,613 was recognized in income for the nine months ended October 31, 2017.

OMIGANAN BASED TECHNOLOGIES

On September 27, 2017 the Company acquired Omiganan based technologies from BioDE. The Company’s primary dermatological assets are Omiganan 1% gel (cationic peptide also known as OmigardTM and MX-226) and Omiganan for dermatological diseases (cationic peptide also known as CLS001). This technology may potentially be used for prevention of catheter-related infections (topical) and treatment of rosacea and other dermatological diseases (topical).

Two Phase III studies for Omiganan 1% gel and Phase II rosacea study for Omiganan for dermatological diseases has been completed. The technology is currently licensed by Cutanea Lifesciences Inc. (“Cutanea”). Cutanea is responsible for all development and related patent costs.

Licensing Agreement – Cutanea Life Sciences Inc.

Cutanea holds the license for the exclusive worldwide rights to develop and market CLS001 (formerly known as MX594AN) and its analogues for dermatological indications. Pursuant to the licensing agreement, the Company is eligible to receive up to approximately US$21,700,000 in development and commercialization milestone payments, in addition to royalties on net sales, as follows:

• US$500,000 upon the first successful completion of a Phase 3 clinical trial;

• US$500,000 upon the first successful completion of a clinical Phase 3 clinical trial with a licensed product under a Company sponsored IND;

• US$1,000,000 upon the first acceptance for review of a Company sponsored NDA by the FDA for a licensed product;

• Additional milestones of up to US$9,200,000 after the product receives FDA approval and approval in the EU and Japan; and

• Sales based milestones of up to US$10,000,000 after sales of up to USD$700,000,000 in sales is achieved.

OTHER ASSETS

Pursuant to the terms of an Amalgamation Agreement between BioAB Strategies Ltd and Invictus MD Strategies Ltd. (“Invictus”), Invictus transferred the existing MX-2401 antibiotic assets (lipopeptide) and related contracts to the Company in exchange of $1. This technology may potentially be used for treatment of serious Gram positive bacterial infections (intravenous). BioHEP's directors and advisors are currently considering potential alternative initiatives regarding the MX-2401 technology.

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

NOTES PAYABLE

On November 13, 2015, the Company entered into a loan agreement for a total amount of $130,000 with 7 parties, including two directors, Global and one officer (collectively, the “Lenders”). The loan agreement provides for a term of two years and bears simple interest of 14% per annum, with interest payable per annum. For the nine months ended October 31, 2017, interest expense of $12,001 (2016 - $13,626) has been recognized in the statement of earnings. Each loan is convertible in part or in whole at the option of the Lenders at deemed price of $0.025 per share for a total of 5,200,000 potential common shares. As additional consideration of the risk associated with the loan, the Company is obligated to issue 1,040,000 common shares to the lenders, the 1,040,000 common shares were issued on December 2, 2015.

Subsequent to October 31, 2017, the Company issued 4,800,000 common shares to 6 lenders pursuant to the conversion of $120,000 aggregate principal amount of convertible promissory notes.

RESULTS OF OPERATIONS AND SELECTED QUARTERLY FINANCIAL DATA

Selected quarterly financial data

The company had increased business activity in Q4/16, Q1/17, and Q2/17 when the license agreement with Spring Bank was re-negotiated followed by a slight decrease in activity in Q3/17. The Company sold 37,500 shares of Spring Bank in Q4/17 and 15,000 shares of Spring Bank in Q1/18 and has invested excess cash in money market funds. Since the end of Q1/18, Spring Bank shares have increased in value from US$9.55 per share to US$15.29 per share as of October 31, 2017. The Company expects the increased activity to continue as it develops the strategy to manage the investments and increased value of its investments.

For the three months ended October 31, 2017, compared to the three months ended October 31, 2016

During the three months ended October 31, 2017, the Company had net loss of $21,860, an increase of $11,259 over the comparative period for the three months ended October 31, 2016, of $10,601. During the three months ended October 31, 2017, the Company had comprehensive income of $556,598, an increase of $406,079 over the comparative period for the three months ended October 31, 2016, of $150,519. This increase is due mainly to the increase in value of the investment in Spring Bank shares from approximately US$13 to $15 net of tax. These shares are accounted for as available for sale and as such gains and losses net of tax are included in other comprehensive income.

During the three months ended October 31, 2017, professional fees increased by $10,765 over the comparative period to $11,765 (2016 - $367). This increase is primarily a result of increased in legal and accounting fees related to the acquisition of the Biotechnology license and patents in the current period.

During the three months ended October 31, 2017, transfer agent and regulatory expense stayed relatively unchanged compared to the comparative period $669 (2016 - $672).

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

During the three months ended October 31, 2017, the Company recognized a fair value gain on its available-for-sale investments of $706,049, compared to $220,671 during the three months ended October 31, 2016. This is a result of the increase in market price of Spring Bank shares. The increase in the deferred income tax expense of $127,591 is a result of an increase in the fair value gain over the Spring Bank Shares. Since these amounts are not realized and the investment is treated as available for sale, the net unrealized gain after taxes is included entirely in other comprehensive income.

For the nine months ended October 31, 2017, compared to the nine months ended October 31, 2016

During the nine months ended October 31, 2017, the Company had net loss of $26,155 (2016 - net income of $2,525,166). During the nine months ended October 31, 2017, the Company had comprehensive income of $2,830,963, a decrease of $1,843,773 over the comparative period for the nine months ended October 31, 2016, of $4,674,736.

During the nine months ended October 31, 2017, the Company did not receive shares and warrants. During the nine months ended October 31, 2016, the Company amended its license agreement with Springbank and in exchange, received 125,000 shares and 125,000 warrants exercisable into 125,000 shares at USD$16 per share expiring August 1, 2018. The shares and warrants were recorded at a fair value of $1,928,625 and $1,133,702 respectively. The shares were valued at USD$11.10 which is based on the closing price on May 6, 2016, the day the shares became publicly traded on the NASDAQ stock exchange. The warrants were valued using the Black-Scholes valuation method. As a result of the described transaction, current tax expense of $240,600 was estimated and recognized in the statement of comprehensive income.

During the nine months ended October 31, 2017, the Company recognized a fair value gain on its available-for-sale investments of $3,266,820, as compared to a gain of $2,972,451 during the nine months ended October 31, 2016. These gains are the result of the increase in market price of Spring Bank shares. The decrease in the deferred income tax expense of $409,702 (2016 - $822,881) is a result of the change of the expected treatment to capital gain instead of regular income for the fair value gain related to the Spring Bank Shares.

During the nine months ended October 31, 2017, the Company sold 15,000 Spring Bank shares and recognized a gain on sale of investments of $56,613. There were no such sales during the comparative period.

During the nine months ended October 31, 2017, the Company recognized dividend income of $2,051 arising from cash invested in money market funds. There were no such dividends during the comparative period.

During the nine months ended October 31, 2017, cash used in operations increased by $244,933 to $286,604 (2016 - $41,672). This is primarily a result of paying income taxes of $240,568

During the nine months ended October 31, 2017, cash provided by investing activities was $129,629 (2016 - $nil). This is due to the Company selling 15,000 shares of Spring Bank and raise funds to pay taxes payable and fund working capital.

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

Selected annual information

The selected financial information below is derived from the Company’s audited financial statements for the years ended January 31, 2017, 2016 and 2015, prepared in accordance with IFRS. The Company’s significant accounting policies and new accounting policies applied in the preparation of its financial statements are outlined in note 3 to the Company’s audited financial statements for the years ended January 31, 2017, 2016 and 2015.

There were no distributions or cash dividends in the past three years. In the year ended January 31, 2017, the Company amended the agreement with Spring Bank and received shares in exchange for the expanded rights under the license agreement. Spring Bank successfully completed an IPO and went public which allowed the Company to reliably estimate the fair value of the related marketable securities during the year ended January 31, 2017 and for the nine months ended October 31, 2017.

OUTSTANDING SHARE DATA

As at December 27, 2017, there are:

• 9,448,708 (October 31, 2017 - 4,648,708) common shares outstanding; and

• Nil warrants or stock options outstanding (October 31, 2017 – Nil).

SUBSEQUENT EVENT

Subsequent to October 31, 2017, the Company issued 4,800,000 common shares to 6 lenders pursuant to the conversion of $120,000 aggregate principal amount of convertible promissory notes including 4,200,000 shares issued to clients of Pathfinder Asset Management Limited (“Pathfinder”). As a result, Pathfinder, increased the shares under management to 61.28% of the Company’s total issued and outstanding shares. In addition, the Company paid the accrued interest owed on the promissory notes settled to November 30, 2017.

LIQUIDITY AND CAPITAL RESOURCES

The Company does not have sufficient working capital to continue operations in the normal course for the foreseeable future and will require additional financing or sell investments to remain financially solvent.

The Company’s financial statements for the nine months ended October 31, 2017, have been prepared on a going concern basis, which assumes that the Company will continue in operation in the foreseeable future and will be able to realize its assets and settle its liabilities in the normal course of business. At October 31, 2017, the Company had

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

working capital of $50,799 (January 31, 2017– $3,938).

The Company’s ability to continue its operations is dependent on its success in raising equity through share issuances, suitable debt financing and/or other financing arrangements.

The Company expects to be able to continue to sell Spring Bank shares if operating funds are needed. There are also risks relating to the Company’s ability to realize the current market value of the Spring Bank shares in the event a sale of shares is forced upon the Company to fund operations (see risk and uncertainties below).

OFF-BALANCE SHEET ARRANGEMENTS

The Company does not have any off-balance sheet arrangements for the nine months ended October 31, 2017.

PROPOSED TRANSACTIONS

The Company does not have any proposed transactions.

MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL STATEMENTS

The information provided in this report, including the condensed interim financial statements, is the responsibility of management. In the preparation of these statements, estimates are sometimes necessary to make a determination of future values for certain assets or liabilities. Management believes such estimates have been based on careful judgments and have been properly reflected in the accompanying financial statements.

APPROVAL

The Company’s Board of Directors has approved the Company’s condensed interim financial statements for the nine months ended October 31, 2017. The Company’s Board of Directors has also approved the disclosures contained in this MD&A. A copy of this MD&A will be provided to anyone who requests it and is available on www.sedar.com.

RELATED PARTY TRANSACTIONS

The Company and Global, its former parent company, entered into the Arrangement. The Arrangement provided for the transfer from Global of $5,000, the investment in Spring Bank and the SB-9000 technologies to the Company, a wholly-owned subsidiary, and the immediate distribution of a controlling interest in the common shares of the Company to the shareholders of Global as at April 11, 2014.

Key management compensation

Key management personnel are persons responsible for planning, directing and controlling the activities of the Company. During the nine months ended October 31, 2017 and 2016, key management personal were not paid any compensation, nor did they receive any employment benefits or other management incentives such as stock options.

During the nine months ended October 31, 2017, the Company incurred $12,870 for professional fees (2016 – $6,079) provided by Fehr & Associates, an entity controlled by the Company’s Corporate Secretary, of which $nil (2016 - $2,300) was included in accounts payable and accrued liabilities.

Other

As at October 31, 2017, the Company had $120,000 in convertible notes payable to related parties (January 31, 2017 – $130,000). Each of Bruce Schmidt, Chester Shynkaryk and Ann Fehr, directly or indirectly loaned the Company of $5,000 as part of this arrangement. Douglas Johnson, a shareholder with greater than 10% ownership of the Company, loaned the Company a $60,000. The Partners Fund, an investment fund managed by Pathfinder Asset Management Limited (“Pathfinder”), loaned the Company $40,000. A limited partnership managed by Pathfinder also loaned the Company $5,000. Pathfinder is retained by the Company to manage the marketable securities and investments of the

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

Company. Douglas Johnson is a director of Pathfinder and an indirect shareholder of Pathfinder. Subsequent to October 31, 2017 $120,000 was converted into 4,800,000 shares of the Company.

RISKS AND UNCERTAINTIES

The Company is in the business of holding biotechnology assets and as such is exposed to a number of risks and uncertainties that are not uncommon to other companies with passive investments. The Company has no ongoing revenue or income from operations. The Company has limited capital resources and has to rely upon the sale its assets or sale of its common shares for cash required to make new investments and to fund the administration of the Company.

These risks may not be the only risks faced by the Company. Additional risks and uncertainties not presently known by the Company or which are presently considered immaterial may also adversely impact the Company’s business, results of operations, and financial performance. Please refer to the MD&A for the year ended January 31, 2017 for an expanded discussion of the risks. The most significant risks and uncertainties faced by the Company are (in no specific order) are:

• There is expressed doubt about our ability to continue as a going concern, which may hinder our ability to achieve our objectives;

• We have not completed the development of any commercial products and have no revenues from the sale of products; we may not achieve profitability;

• Even if we obtain the necessary marketing approvals, our products may not gain meaningful market acceptance, and we may not become profitable;

• Our product candidates subject us to the risk of product liability claims for which we may not be able to maintain or obtain adequate insurance coverage;

• Our assets under development by the manager require significant testing; Spring Bank may not be able to obtain the regulatory approvals or clearances necessary to commercialize products;

• Even if any of the product candidates receive regulatory approval, Spring Bank may still face development and regulatory difficulties that may delay or impair future royalties to the Company;

• Our success depends on our ability and the ability of the manager of the assets to protect our proprietary rights and operate without infringing the proprietary rights of others; we may incur significant expenses or be prevented from developing and/or commercializing products as a result of an intellectual property infringement claim; and

• The Company's directors and officers may, from time to time, serve in similar positions with other public companies, which may put them in a conflict position from time to time.

FINANCIAL INSTRUMENTS

At October 31, 2017 and January 31, 2017, the carrying values of cash, accounts payable and accrued liabilities approximate their fair values due their short-term maturity.

Financial instruments recorded at fair value on the statements of financial position are classified using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy are as follows:

Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly (i.e., as prices) or indirectly (i.e., derived from prices); and Level 3: Inputs that are not based on observable market data.

Inputs that are not based on observable market data.

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

At October 31, 2017 and January 31, 2017, the Company has designated its notes payables as Level 2. The investments in Spring Bank Pharmaceuticals Inc. are designated as Level 1.

CRITICAL ACCOUNTING ESTIMATES

The preparation of the Company’s financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Areas requiring the use of estimates in the preparation of the Company’s financial statements the assumptions used to determine the fair value of warrants included in investments and deferred taxes. Management believes the estimates used are reasonable; however, actual results could differ materially from those estimates and, if so, would impact future results of operations and cash flows.

SIGNIFICANT ACCOUNTING POLICIES

These condensed interim financial statements have been prepared on the basis of accounting policies and methods of computation consistent with those applied in the Company’s audited annual financial statements for the fiscal year ended January 31, 2017. Please refer to the audited financial statements for the year ended January 31, 2017 for additional information.

ACCOUNTING STANDARDS ISSUED BUT NOT YET EFFECTIVE

At the date of authorization of these financial statements, the IASB and International Financial Reporting Interpretation Committee have issued a number of new and revised standards and interpretations, which are not yet effective for the relevant reporting periods. The new and revised standards are applicable to the Company. Please refer to the financial statements for additional information.

FORWARD-LOOKING INFORMATION OR STATEMENTS AND CAUTIONARY FACTORS THAT MAY AFFECT FUTURE RESULTS

Certain statements contained in the following MD&A constitute forward-looking statements (within the meaning of the Canadian securities legislation and the U.S. Private Securities Litigation Reform Act of 1995) that involve risks and uncertainties. Forward-looking statements are frequently, but not always, identified by words such as “expects”, “anticipates”, “believes”, “intends”, “estimates”, “potential”, “possible” and similar expressions, or statements that events, conditions or results “will”, “may”, “could” or “should” occur or be achieved. The forward-looking statements may include statements regarding work programs, capital expenditures, timelines, strategic plans, market price of commodities or other statements that are not statement of fact. Forward-looking statements are statements about the future and are inherently uncertain, and actual achievements of the Company may differ materially from those reflected in forward-looking statements due to a variety of risks, uncertainties and other factors. For the reasons set forth above, investors should not place undue reliance on forward-looking statements. Important factors that could cause actual results to differ materially from the Company’s expectations include uncertainties involved in disputes and litigation, fluctuations in currency exchange rates; uncertainty of estimates of capital and operating costs; the need to obtain additional financing and uncertainty as to the availability and terms of future financing; and other risks and uncertainties disclosed in other information released by the Company from time to time and filed with the appropriate regulatory agencies.

It is the Company’s policies that all forward-looking statements are based on the Company’s beliefs and assumptions which are based on information available at the time these assumptions are made. The forward-looking statements contained herein are as of December 22, 2017, and are subject to change after this date, and the Company assumes no obligation to publicly update or revise the statements to reflect new events or circumstances, except as may be required pursuant to applicable laws. Although management believes that the expectations represented by such forward-looking information or statements are reasonable, there is significant risk that the forward-looking information or statements may not be achieved, and the underlying assumptions thereto will not prove to be accurate. Forward-looking information or statements in this MD&A include, but are not limited to, information or statements

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BioHEP Technologies Ltd. Management’s Discussion & Analysis For the nine months ended October 31, 2017

concerning our expectations regarding the ability to raise additional funds and find additional value in the biotechnology assets held.

Actual results or events could differ materially from the plans, intentions and expectations expressed or implied in any forward-looking information or statements, including the underlying assumptions thereto, as a result of numerous risks, uncertainties and factors including: the possibility that opportunities will arise that require more cash than the Company has or can reasonably obtain; dependence on key personnel; dependence on corporate collaborations; potential delays; uncertainties related to early stage of technology and product development; uncertainties as to fluctuation of the stock market; uncertainties as to future expense levels and the possibility of unanticipated costs or expenses or cost overruns; and other risks and uncertainties which may not be described herein. The Company has no policy for updating forward looking information beyond the procedures required under applicable securities laws.

Vancouver, BC

December 27, 2017

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