Indicate by check whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X ] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of ~~“large~~"large accelerated filer,~~” “accelerated~~" "accelerated filer,~~” “smaller~~" "smaller reporting ~~company”~~company" and ~~“emerging~~"emerging growth ~~company”~~company" in Rule 12b-2 of the Exchange Act. (Check one):

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The number of shares of Predictive common stock outstanding as of ~~May 14,~~November 13, 2020 was ~~299,396,808.~~299,596,808.

QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED ~~MARCH 31,~~SEPTEMBER 30, 2020


			As of					As of
			March 31,		June 30,			September 30,		June 30,
			2020		2019			2020		2020
ASSETS	ASSETS					ASSETS
Current assets:	Current assets:					Current assets:
	Cash	$	206,443	$	1,618,244	Cash	$	1,270,841	$	331,228
	Accounts receivable, net of allowance for doubtful accounts of $149,241 and $687,064		125,923		1,250,476	Accounts receivable, net of allowance for doubtful accounts of $167,569 and $239,392		677,069		136,903
	Due from equity method investee		-		184,443	Inventory		1,027,940		1,514,841
	Inventory		2,190,293		5,775,185	Other current assets		5,413,656		5,720,561
	Other current assets		227,640		103,080
Total current assets	Total current assets		2,750,299		8,931,428	Total current assets		8,389,506		7,703,533
Fixed assets, net of depreciation			5,746,500		6,974,441
Property, plant, and equipment, net						Property, plant, and equipment, net		5,097,495		5,305,099
Operating lease right of use assets	Operating lease right of use assets		1,323,973		-	Operating lease right of use assets		902,071		1,115,308
License agreements, net of amortization	License agreements, net of amortization		16,564,125		18,062,315	License agreements, net of amortization		15,549,378		16,064,728
Patents, net of amortization	Patents, net of amortization		6,276,961		6,850,490	Patents, net of amortization		5,905,910		6,085,785
Trade secrets, net of amortization	Trade secrets, net of amortization		40,792,586		45,336,335	Trade secrets, net of amortization		26,256,329		29,236,447
Other intangible assets, net of amortization	Other intangible assets, net of amortization		314,990		383,931	Other intangible assets, net of amortization		276,586		295,788
Equity method investments	Equity method investments		34,947,717		51,717,719	Equity method investments		11,961,538		12,731,383
Goodwill	Goodwill		5,254,451		5,254,451	Goodwill		-		5,254,451
Other long-term assets	Other long-term assets		45,672		67,075	Other long-term assets		46,771		49,893
Total assets	Total assets	$	114,017,274	$	143,578,185	Total assets	$	74,385,584	$	83,842,415
LIABILITIES AND STOCKHOLDERS' EQUITY	LIABILITIES AND STOCKHOLDERS' EQUITY					LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:	Current liabilities:					Current liabilities:
Accounts payable	Accounts payable	$	4,712,283	$	4,943,178	Accounts payable	$	6,083,786	$	4,988,319
Accrued liabilities	Accrued liabilities		2,368,629		1,857,771	Accrued liabilities		7,429,610		8,046,814
Deferred revenue	Deferred revenue		286,991		469,376	Deferred revenue		318,345		381,889
Operating lease liability, current portion	Operating lease liability, current portion		886,662		-	Operating lease liability, current portion		944,518		914,473
Finance lease liability, current portion	Finance lease liability, current portion		647,721		504,488	Finance lease liability, current portion		653,486		649,492
Notes payable, current portion						Notes payable, current portion		1,341,514		705,234
Subscription payable, current portion	Subscription payable, current portion		3,500,000		6,300,000	Subscription payable, current portion		6,460,253		5,150,000
Total current liabilities	Total current liabilities		12,402,286		14,074,813	Total current liabilities		23,231,512		20,836,221
Operating lease liability			481,579		-
Finance lease liability			1,027,015		1,511,554
Subscription payable			3,706,610		4,040,610
Notes payable			2,800,000		400,000
Operating lease liability, net of current portion						Operating lease liability, net of current portion		-		243,378
Finance lease liability, net of current portion						Finance lease liability, net of current portion		692,829		861,613
Notes payable, net of current portion						Notes payable, net of current portion		6,829,705		4,465,985
Subscription payable, net of current portion						Subscription payable, net of current portion		706,610		2,056,610
Deferred tax liabilities	Deferred tax liabilities		2,731,781		11,014,745	Deferred tax liabilities		300,896		300,896
Other non-current liabilities						Other non-current liabilities		256,314		154,430
Total liabilities	Total liabilities		23,149,271		31,041,722	Total liabilities		32,017,866		28,919,133

Stockholders' equity:	Stockholders' equity:					Stockholders' equity:
Common stock, par value $0.001, 299,396,808 and 273,761,955
shares issued and outstanding at March 31, 2020 and
June 30, 2019; 900,000,000 shares authorized			299,397		273,762
Common stock, par value $0.001, 299,596,808 and 299,596,808						Common stock, par value $0.001, 299,596,808 and 299,596,808
shares issued and outstanding at September 30, 2020 and						shares issued and outstanding at September 30, 2020 and
2019; 900,000,000 shares authorized						2019; 900,000,000 shares authorized		299,597		299,597
Additional paid-in capital	Additional paid-in capital		179,574,800		153,604,830	Additional paid-in capital		184,799,403		181,862,823
Accumulated deficit	Accumulated deficit		(88,671,105)		(41,102,849)	Accumulated deficit		(142,332,179)		(126,872,115)
Total controlling interest	Total controlling interest		91,203,092		112,775,743	Total controlling interest		42,766,821		55,290,305
Non-controlling interest	Non-controlling interest		(335,089)		(239,280)	Non-controlling interest		(399,103)		(367,023)
Total stockholders' equity	Total stockholders' equity		90,868,003		112,536,463	Total stockholders' equity		42,367,718		54,923,282
Total liabilities and stockholders' equity	Total liabilities and stockholders' equity	$	114,017,274	$	143,578,185	Total liabilities and stockholders' equity	$	74,385,584	$	83,842,415



	Three months ended March 31,				Nine months ended March 31,				Three months ended September 30,
	2020		2019		2020		2019		2020		2019
Revenue	$	5,723,984	$	11,295,618	$	21,319,882	$	30,046,456	$	5,091,004	$	8,259,257
Cost of goods sold, exclusive of depreciation & amortization shown below		4,237,824		4,773,332		17,260,070		10,881,024
Cost of goods sold, exclusive of depreciation & amortization shown below:										3,465,137		7,181,991

Operating expenses:
Selling and marketing		2,002,394		2,888,309		8,203,957		8,726,902		1,061,798		3,151,971
General and administrative		6,343,658		4,835,652		19,757,304		10,380,413		5,257,499		6,378,877
Research and development		2,125,421		1,458,265		6,318,121		3,823,908		370,842		1,828,350
Depreciation and amortization		2,738,165		2,374,006		8,123,484		6,075,090		2,484,083		2,610,245
Loss on impairment										7,015,326		-
Total operating expenses		13,209,638		11,556,232		42,402,866		29,006,313		16,189,548		13,969,443

Operating loss		(11,723,478)		(5,033,946)		(38,343,054)		(9,840,881)		(14,563,681)		(12,892,177)

Loss on equity method investment		(651,450)		(193,524)		(17,040,002)		(1,108,423)
Other income (expense)		(100,118)		275,512		(471,336)		276,425
Total other income (loss)		(751,568)		81,988		(17,511,338)		(831,998)
Total other loss										(927,411)		(212,782)

Loss before income taxes		(12,475,046)		(4,951,958)		(55,854,392)		(10,672,879)		(15,491,092)		(13,104,959)

Benefit from (provision for) income taxes		(1,257,868)		1,215,312		8,190,327		2,541,290		(1,052)		5,208,418

Net loss & comprehensive loss	$	(13,732,914)	$	(3,736,646)	$	(47,664,065)	$	(8,131,589)	$	(15,492,144)	$	(7,896,541)

Net loss non-controlling interest		(31,934)		(27,735)		(95,809)		(88,858)		(32,080)		(31,934)

Net loss attributable to common shareholders	$	(13,700,980)	$	(3,708,911)	$	(47,568,256)	$	(8,042,731)	$	(15,460,064)	$	(7,864,607)

Weighted average common shares outstanding, basic & diluted		294,685,635		272,029,651		293,866,529		263,060,001		299,596,808		281,027,491

Basic & diluted loss per share attributable to common shareholders	$	(0.05)	$	(0.01)	$	(0.16)	$	(0.03)	$	(0.05)	$	(0.03)

Nine months ended March 31,

2020

2019
Cash flows from operating activities:

Net loss
$
(47,664,065)
$
(8,131,589)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization
8,123,484
6,075,090
Provision for bad debts
177,560
-
Share based compensation
13,363,687
4,238,790
Deferred income taxes
(8,282,964)
(2,541,290)
Non-cash lease expense
533,705
-
Gain on bargain purchase
-
(272,757)
Losses on equity method investment
17,040,002
1,108,423
Changes in operating assets and liabilities:

Accounts receivable
947,436
(80,331)
Inventory
3,584,892
977,555
Prepaid expenses
(124,560)
(88,542)
Other assets
21,403
(57,273)
Accounts payable
107,651
808,725
Accrued liabilities
822,776
520,805
Operating lease liability
(534,981)
-
Deferred revenue
(182,385)
501,685
Net cash provided by (used in) operating activities

(12,066,359)
3,059,291

Cash flows from investing activities:

Purchases of property and equipment
(504,136)
(2,554,966)
   Cash acquired from acquisitions, net
-
885,674
   Cash payments on equity method investee stock subscription
(520,000)
(1,634,390)
   Capitalization of patent acquisition costs
-
(163,461)
Net cash used in investing activities

(1,024,136)
(3,467,143)

Cash flows from financing activities:

Cash proceeds from stock subscriptions
-
1,025,000
Proceeds from sale of common stock
480,000
-
Exercises of stock options
-
3,133
Proceeds from issuance of long term debt
11,540,000
-
Principal payments on finance leases
(341,306)
-
Net cash provided by financing activities

11,678,694
1,028,133

Net increase (decrease) in cash and cash equivalents

(1,411,801)
620,281
Cash and cash equivalents at the beginning of the period
$
1,618,244
$
1,206,139
Cash and cash equivalents at the end of the period
$
206,443
$
1,826,420

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF ~~STOCKHOLDERS’~~STOCKHOLDERS' EQUITY

Predictive Technology Group, Inc., together with its subsidiaries (collectively, ~~“PTG”, “Predictive”~~"PTG" or the ~~“Company”~~"Company"), develops and commercializes discoveries and technologies involved in novel molecular diagnostic, therapeutic, and Human Cellular and Tissue-Based Products (“("HCT/~~Ps”~~Ps"). The Company uses this information as the cornerstone in the development of new diagnostics that assess a ~~person’s~~person's risk of disease and develop pharmaceutical therapeutics and HCT/Ps for use by healthcare professionals to improve outcomes in their patients. The ~~Company’s~~Company's corporate headquarters are located in Salt Lake City, Utah.

Operating segments are identified as components of an enterprise about which separate discrete financial information is available for evaluation by the chief operating decision-maker (CODM) in making decisions regarding resource allocation and assessing performance. The Company operates in two reportable segments, which are differentiated by product. The HCT/P segment offers minimally manipulated tissue products intended for homologous use, prepared utilizing proprietary extraction methods that reduce the loss of important scaffolding, growth factors and cytokines. The ~~Company’s~~Company's Diagnostics and Therapeutics segment uses data analytics for disease identification and subsequent therapeutic intervention through novel gene-based diagnostics, and companion therapeutics. Lastly, the ~~“Unallocated Corporate”~~"Unallocated Corporate" column in the table below represents those headquarters activities that do not qualify as operating segments and which are not allocated to operating segments in information provided to the CODM. We currently operate and sell our products exclusively in the United States.

During the fourth quarter of fiscal 2019, we realigned our segment reporting to separately present headquarters costs in information available to the CODM. The presentation of the comparative information has been recast to conform to the fiscal 2019 presentation.

Segment ~~revenue and operating losswere~~information was as follows during the periods presented:

The accompanying condensed consolidated financial statements have been prepared by Predictive Technology Group, Inc. ~~(the “Company” or “Predictive”)~~ in accordance with U.S. generally accepted accounting principles ~~(“GAAP”~~("GAAP") for financial information and pursuant to the applicable rules and regulations of the Securities and Exchange Commission ~~(“SEC”~~("SEC"). The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. In the opinion of management, the accompanying financial statements contain all adjustments (consisting of normal and recurring accruals) necessary to present fairly all financial statements in accordance with U.S. GAAP.

The condensed consolidated financial statements herein should be read in conjunction with the ~~Company’s~~Company's audited condensed consolidated financial statements and notes thereto for the fiscal year ended June 30, ~~2019,~~2020, included in the ~~Company’s~~Company's Annual Report on Form 10-K for the fiscal year ended June 30, ~~2019.~~2020. Operating results for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 may not necessarily be indicative of results to be expected for any other interim period or for the full fiscal year.

The Company operates on a fiscal year basis with the fiscal year ending on June 30.

These consolidated financial statements include the financial statements of Predictive Technology Group, Inc. and its wholly owned subsidiaries. All inter-company accounts and transactions have been eliminated in consolidation.

On March 11, 2020, the World Health Organization declared the novel coronavirus (“COVID-19”), a respiratory illness first identified in Wuhan, China, a pandemic. The global spread of COVID-19 has created significant volatility, uncertainty and economic disruption. Governments in affected regions have implemented, and may continue to implement, safety precautions which include quarantines, travel restrictions, business closures, cancellations of public gatherings and other measures as they deem necessary. Many organizations and individuals, including the Company and its employees, are taking additional steps to avoid or reduce infection, including limiting travel and working from home. These measures are disrupting normal business operations both in and outside of affected areas and have had significant negative impacts on businesses and financial markets worldwide.

The Company experienced operational and financial impacts from the COVID-19 pandemic beginning late in the third quarter of fiscal 2020, including the impact of stay-at-home mandates and related safety measures such as the delay of elective medical procedures, resulting in a decline in the volume of procedures using the Company’s products. The Company has implemented cost cutting measures, including a headcount reduction in April 2020 in the HCT/P segment of approximately 50%.

The severity of the material impact of the COVID-19 pandemic on the Company's business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on the Company's customers and suppliers, all of which are uncertain and cannot be predicted. The impact of COVID-19 on the Company’s results of operations and cash flows has been material and is expected to continue to be material, at least in the short term. Given the dynamic nature of this situation, the Company is currently unable to accurately predict the impact of COVID-19 on its overall 2020 operations and financial results or cash flows for the foreseeable future and whether the impact of COVID-19 could lead to potential impairments.

The Company considers all highly-liquid investments with a maturity of three months or less, when purchased, to be cash equivalents. The Company places its temporary cash investments with high-quality financial institutions.

The accompanying condensed consolidated financial statements have been prepared under the assumption that the Company will continue to operate as a going concern, which contemplates the realization of assets and the settlement of liabilities in the normal course of business. The condensed consolidated financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts of liabilities that may result from any inability of the Company to continue as a going concern.

The Company incurred a net loss attributable to common ~~shareholders~~stockholders of ~~$47,568,256~~$15,460,064 and net cash outflows from operations of ~~$12,066,359~~$1,867,499 for the ~~nine~~three months ended ~~March 31,~~September 30, 2020. At ~~March 31,~~September 30, 2020, the Company had ~~$206,443~~$1,270,841 of cash and negative working capital of ~~$9,651,987.~~$14,842,006. The Company's historical and current use of cash in operations combined with limited liquidity resources raise substantial doubt regarding the Company's ability to continue as a going concern. Management may seek additional capital through debt financings, collaborative or other funding arrangements with partners, sale of assets, or through other sources of financing. Should the Company seek additional financing from outside sources, the Company may not be able to raise such financing on terms acceptable to the Company or at ~~all.~~all to mitigate the substantial doubt that exists. If the Company is unable to raise additional capital when required or on acceptable terms, this could have a material adverse effect on liquidity. In such a case, the Company may be required to scale back or to discontinue the promotion of currently available products, scale back or discontinue the advancement of product candidates, reduce headcount, file for bankruptcy, reorganize, merge with another entity, or cease operations.

Trade accounts receivable are primarily comprised of amounts due from sales of the ~~Company’s~~Company's HCT/P products and sales of medical diagnostic testing services that are recorded at the invoiced amount, ~~and~~as well as deposits in transit from credit card processors. The allowance for doubtful accounts is based on the ~~Company’s~~Company's best estimate of the amount of probable losses in the ~~Company’s~~Company's existing accounts receivable, which is based on historical write-off experience, customer creditworthiness, facts and circumstances specific to outstanding balances, and payment terms. Account balances are charged against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off-balance-sheet credit exposure related to its customers and does not require collateral.

Inventories consist primarily of ~~HCT/Ps produced by Predictive Biotech, Inc. (“Predictive Biotech”), a wholly owned subsidiary and~~ laboratory supplies used in genetic testing performed by Predictive Laboratories, Inc. (“("Predictive ~~Labs”~~Labs") and HCT/Ps produced by Predictive Biotech, Inc. ("Predictive Biotech"). We value inventory at the lower of cost or net realizable value. We determine the cost of inventory using the standard cost method, which approximates actual cost based on a first-in, first-out method. All other costs, including administrative costs, are expensed as incurred.

We analyze our inventory levels at least quarterly and write down inventory that has a cost basis in excess of its expected net realizable value, or that is considered in excess of normal operating levels, as determined by management. We also reserve for the quantity of quarantined (WIP) inventory that is not expected to pass quality control based on historical averages. The related costs are recognized as cost of goods sold in the condensed consolidated statements of operations.

Stock subscriptions are recorded as contra-equity on the day the subscription agreement is signed and accepted by the Company. As of March 31, 2020 and June 30, 2019, all stock subscribed has been fully paid.

Amounts paid in advance for expenses are accounted for as prepaid expenses and classified as current assets if such amounts are to be recognized as expense within one year from the balance sheet date.

Lab equipment, furniture and computer equipment are stated at cost less accumulated depreciation. Depreciation is computed using the straight-line method based on the lesser of estimated useful lives of the related assets or the underlying lease term. Lab equipment items have depreciable lives of 5 years, furniture items have depreciable lives of 5 to 7 years, and computer equipment items have depreciable lives of 3 years. Repair and maintenance costs are charged to expense as incurred. Amortization of assets recorded under finance leases is included in depreciation expense.

The Company reviews property and equipment for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If property and equipment are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market value.

We have entered into operating and finance lease agreements primarily for office and laboratory facilities and laboratory equipment located in Salt Lake City, Utah with lease periods expiring between ~~2020~~2021 and ~~2022.~~2023.

We determine if an arrangement is a lease at inception. For all classes of underlying assets, we elect not to recognize right of use assets or lease liabilities when a lease has a lease term of 12 months or less at the commencement date and does not include an option to purchase the underlying asset that we are reasonably certain to exercise. ~~Operating lease assets and liabilities are included on our consolidated balance sheet beginning July 1, 2019.~~ Finance lease assets are included in property, plant, and equipment, net.

Operating lease assets and liabilities are recognized at the present value of the future lease payments at the lease commencement date. The interest rate used to determine the present value of the future lease payments is our incremental borrowing rate, because the interest rate implicit in most of our leases is not readily determinable. Our incremental borrowing rate is estimated to approximate the interest rate on a collateralized basis with similar terms and payments, and in economic environments where the leased asset is located. Operating lease assets also include any prepaid lease payments and lease incentives. Our lease terms include periods under options to extend or terminate the lease when it is reasonably certain that we will exercise that option. We generally use the base, non-cancelable, lease term when determining the lease assets and liabilities. Operating lease expense is recognized on a straight-line basis over the lease term.

Our lease agreements generally contain lease and non-lease components. Non-lease components primarily include payments for maintenance and utilities. We combine fixed payments for non-lease components with our lease payments and account for them together as a single lease component, which increases the amount of our lease assets and liabilities.

Intangible and other long-lived assets are comprised of acquired patents, licenses, trade secrets and other intellectual property. Acquired intangible assets are recorded at fair value and amortized over the shorter of the contractual life or the estimated useful life.

The Company reviews definite-lived intangible assets for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair market ~~value~~value.

As of June 30, 2020, the Company had identified indicators of impairment for certain of its long-lived assets ~~not subject~~for certain of its long-lived assets and performed an impairment test related to ~~amortization are reviewed~~those long-lived assets. An impairment charge of $10,041,556 was recorded related to assets acquired with Regenerative Medical Technologies, Inc. (see Note 3).

In October 2020, the Company stopped selling its CoreCyte product in connection with the decision to accelerate the Company's previously existing plan to file an Investigational New Drug (IND) application for ~~impairment annually, typically at~~CoreCyte with the ~~beginning~~FDA. The Company submitted documentation to begin the process of filing the IND on October 30, 2020, in which CoreCyte is indicated for the treatment of osteoarthritis of the ~~fourth fiscal quarter, or whenever~~knee. As the sequence of events ~~or changes~~that led to this decision began with the receipt of a Warning Letter from the FDA in ~~circumstances indicate~~August 2020, it was determined that the ~~carrying value~~decision to stop selling CoreCyte was an indicator of an asset may not be recoverable. Such events and circumstances may include sweeping regulatory changes, shifts in market demand that would negatively impact revenue, overall industry deterioration, dramatic increaseimpairment as of September 30, 2020. An impairment charge of $1,760,875 was recognized related to the trade secrets in the ~~number of competitors, rapidly increasing costs related to production inputs, significant changes~~HCT/P segment (see Note 3). There were no impairments for the three months ended September 30, 2019.

Additional delays in ~~Company management or Company strategy, or significant litigation. The Company first assesses qualitative factors above to determine whether it is necessary to perform~~ the ~~quantitative impairment test to identify any impairment loss.~~

~~Recoverability of assets to be held and used is measured by a comparison~~commercial launch of the ~~carrying amount of an asset or asset group to estimated future undiscounted net cash flows, or fair value,~~Company's diagnostic products such as those that may result from a prolongation of the ~~related asset or group of assets over their remaining lives.~~COVID-19 pandemic would adversely affect our business and potentially lead to additional impairment charges in the future.

Certain of the ~~Company’s~~Company's patents are currently subject to litigation (see Note ~~13)~~11) to determine whether the seller of the patents had ~~satisfactory~~faithfully represented the nature of their ownership of patents that were sold to the Company. The seller of the patents represented that all rights, title, and interest to the patents was transferred to the Company as part of the sale. However, the Company and its patent counsel have identified information in the US Patent and Trademark Office's (USPTO's) registry that calls into question whether the seller of the patents had all rights, title, and interest in the patents when they were ~~then~~ sold to the Company. The Company raised these concerns with the seller of the patents but was unable to secure clear and satisfactory proof on a voluntary basis. These patents have a carrying value of ~~$6,276,961~~$5,905,910 on our condensed consolidated balance sheet as of ~~March 31,~~September 30, 2020. While there is some question as to whether the ~~litigation is in its early stages and may reach a broad range of possible outcomes,~~Company has full title to these patents, we believe that we have ~~determined that it is~~ at least ~~reasonably possible that the patents may become impaired in the near term depending~~partial ownership and can develop products based on the ~~information gained during the legal discovery process and the outcome of the litigation.~~patents.

We test goodwill for impairment on an annual basis as of April 1 and in the interim by reporting unit if events and circumstances indicate that goodwill may be impaired. The events and circumstances that are considered include business climate and market conditions, legal factors, operating performance indicators and competition. All goodwill is included in the HCT/P segment.

Impairment of goodwill is evaluated on a qualitative basis to determine if using a two-step process is necessary. If the qualitative assessment suggests that impairment is more likely than not, a two-step impairment analysis is performed. The first step involves comparison of the fair value of a reporting unit with its carrying amount. The valuation of a reporting unit requires judgment in estimating future cash flows, discount rates and other factors. In making these judgments, we evaluate the financial health of our business, including such factors as industry performance, market saturation and opportunity, changes in technology and operating cash flows.

Changes in our forecasts or decreases in the value of our common stock could indicate that the book value of reporting units to exceed their fair values. If the carrying amount of a reporting unit exceeds its fair value, the second step of the process involves a comparison of the fair value and the carrying amount of the goodwill of that reporting unit. If the carrying amount of the goodwill of the reporting unit exceeds the fair value of that goodwill, an impairment loss would be recognized in an amount equal to the excess of carrying value over fair value. If an event occurs that would cause a revision to the estimates and assumptions used in analyzing the value of the goodwill, the revision could result in a non-cash impairment charge that could have a material impact on the financial results.

We apply the equity method of accounting for investments in which we have significant influence but not a controlling interest. The Company reviews equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amount of the investment may not be recoverable in accordance with generally accepted accounting principles. This determination requires significant judgment. In making this judgment, the Company considers available quantitative and qualitative evidence in evaluating potential impairment of these investments. If it is determined that an indicator of impairment exists, the Company assesses whether the carrying value exceeds the fair value of the asset. If the carrying value of the investment exceeds its fair value, the Company will evaluate, among other factors, general market conditions, the duration and extent to which the carrying value is greater than the fair value, and the ~~Company’s~~Company's intent and ability to hold, or plans to sell, the investment. The Company also considers specific adverse conditions related to the financial health of and business outlook for the investee, including industry and sector performance, changes in technology, and operational and financing cash flow factors. Once a decline in fair value is determined to be other-than-temporary, an impairment charge will be recorded and a new carrying basis in the investment will be established. The Company recorded an impairment ~~charge of $15,932,016~~charges totaling $37,907,283 related to our equity method investment in Juneau Biosciences, LLC for the ~~nine months~~year ended ~~March 31,~~June 30, 2020 (see Note 6)4). NoThere were no impairments ~~were recorded during~~for the three months ended ~~March 31,~~September 30, 2020 ~~nor~~or 2019, respectively.

On May 6, 2020, Company received loan proceeds of $1,665,985 under the Paycheck Protection Program ("PPP") under a promissory note from a commercial bank (the "PPP Loan"). The PPP, established as part of the CARES Act, provides for loans to qualifying businesses for amounts up to 2.5 times the ~~three~~average monthly payroll expenses of the qualifying business. As amended, the CARES act provides that the loans and accrued interest are forgivable after twenty-four weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels. The PPP Loan is included in notes payable in the condensed consolidated balance sheets. Should all or ~~nine months ended March 31, 2019.~~part of the PPP Loan be forgiven, the amount forgiven will be derecognized through other income in the period when forgiveness is granted by the governing authority.

We derive our revenue primarily from sales of HCT/P products and medical diagnostic testing services to clinicians. The majority of our contracts with customers have a single performance obligation, and all of our contracts with customers have a duration of less than one year. Revenue is recognized when control of the product passes to the customer, typically upon confirmation of delivery of the product to the customer. As our products must remain frozen during transit, we typically ship our products overnight. Revenue is recognized in an amount that reflects the expected consideration to be received in exchange for such goods or services. As such, customer orders are recorded as deferred revenue prior to delivery of products or services ordered.

Generally, we require authorization from a credit card or verification of receipt of payment before we ship products to customers. From time to time we grant credit to our customers with normal credit terms (typically 30 days). We do not recognize assets associated with costs to obtain or fulfill a contract with a customer, as the amortization period for any such costs if capitalized would be one year or less.

Shipping and handling is considered a fulfillment activity, as it takes place prior to the customer obtaining control of the product, and fees charged to customers are included in net revenue upon completion of our performance obligation. Shipping and handling expenses are included in cost of sales. We present revenue net of sales taxes, discounts, and expected returns.

We recognize a contract liability when customer payment precedes the completion of our performance obligations.

The following table provides information about deferred revenue from contracts with customers, including significant changes in deferred revenue balances during the period.


		Nine months ended March 31,				Three months ended September 30,
		2020		2019		2020		2019
Deferred revenue – beginning balance	$	469,376	$	-
Deferred revenue - beginning balance					$	381,889	$	469,376
Increase due to deferral of revenue at period end		286,991		501,685		318,345		529,870
Decrease due to beginning contract liabilities recognized as revenue		(469,376)		-		(381,889)		(469,376)
Deferred revenue – ending balance		286,991		501,685
Deferred revenue - ending balance					$	318,345	$	529,870

The Company maintains product liability insurance and has not experienced any related claims from its product offerings. The Company also offers a warranty to customers providing that its products will be delivered free of any material defects. There have been no material costs incurred since inception based on estimated return rates. The Company reviews the adequacy of its accrual on a quarterly basis.

The Company issues share-based compensation awards in the form of stock option grants. We use the Black-Scholes-Merton option pricing model to estimate the fair value of options granted under our equity incentive plans. The Black-Scholes-Merton option valuation model requires the use of assumptions, including the expected term of the award and the expected share price volatility. The Company uses the "simplified" method to estimate the expected option term. Stock-based compensation is measured at the grant date for all stock-based awards made to employees and non-employees based on the fair value of the awards. Stock-based compensation is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period.

The estimated fair value of performance-contingent equity awards is expensed using an accelerated method over the term of the award once we have determined that it is probable that performance milestones will be achieved. Compensation expense for equity awards that contain performance conditions is based on the grant date fair value of the award. Compensation expense is recorded over the requisite service period based on management's best estimate as to whether it is probable that the shares awarded are expected to vest. We assess the probability of the performance milestones being met on a continuous basis.

In order to determine the ~~Company’s~~Company's quarterly provision for income taxes, the Company uses an estimated annual effective tax rate that is based on expected annual income and applicable federal and state tax rates. Deferred tax assets and liabilities are recorded to reflect the future tax consequences attributable to the effects of differences between the carrying amounts of existing assets and liabilities for financial reporting and for income tax purposes. Deferred taxes are calculated by applying enacted statutory tax rates and tax laws to future years in which temporary differences are expected to reverse. The impact on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that the rate change is enacted.

Comprehensive loss is comprised of net loss and other comprehensive loss. Other comprehensive loss is equal to net loss for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 and 2019.

Basic net loss per common share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing the net loss attributable to common stockholders by the weighted-average number of common shares and dilutive common share equivalents outstanding during the period. Because the Company has reported a net loss attributable to common stockholders for all periods presented, diluted net loss per common share is the same as basic net loss per common share for these periods.

The fair value of a financial instrument is the amount that could be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Financial assets are marked to bid prices and financial liabilities are marked to offer prices. Fair value measurements do not include transaction costs. A fair value hierarchy is used to prioritize the quality and reliability of the information used to determine fair values. Categorization within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The fair value hierarchy is defined in the following three categories:

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 2: Observable market-based inputs or inputs that are corroborated by market data.

During the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 and 2019, we did not have any remeasurements of non-financial assets measured at fair value on a non-recurring basis subsequent to their initial ~~recognition, other than the impairment of our equity method investment in Juneau Biosciences, LLC described in Note 6.~~recognition.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of sales and expenses during the reporting periods. Key estimates in the accompanying unaudited condensed consolidated financial statements include, among others, ~~revenue recognition,~~ allowances for doubtful accounts and product returns, provisions for obsolete inventory, valuation of long-lived assets, and deferred income tax asset valuation allowances. Actual results could differ materially from these estimates.

Subsequent to the issuance of the Company's condensed consolidated financial statements for the three and nine months ended March 31, 2019, the Company discovered an error in the Company's shared-based compensation within the condensed consolidated statement of stockholders' equity. Share-based compensation was understated therein for the three months ended September 30, 2018 and December 31, 2018 by approximately $22,000 and $358,000, respectively, and was overstated therein for the three months ended March 31, 2019 by approximately $380,000. As a result, the accompanying condensed consolidated statement of stockholders' equity has corrected the share-based compensation therein from $906,948, $653,372 and $2,634,969, as previously reported, for the periods ended September 30, 2018, December 31, 2018 and March 31, 2019, respectively. There was no other impact to the condensed consolidated financial statements for the three and nine months ended March 31, 2019.

In June 2016, the FASB issued ASU 2016-13, ~~“Financial~~"Financial Instruments –- Credit Losses (Topic 326)”" which introduces new guidance for the accounting for credit losses on instruments within its scope. The new guidance ~~as amended by subsequent ASUs,~~ introduces an approach based on expected losses to estimate credit losses on certain types of financial instruments. For trade receivables, the Company will be required to use a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses which reflects losses that are probable. ~~For public business entities that meet~~After the ~~definition~~issuance of ~~a U.S. Securities and Exchange Commission (SEC) filer, excluding entities eligible to be~~ASU 2019-10, the guidance is effective for smaller reporting companies as defined by the SEC, the amendments in this Update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. For all other entities, the amendments in this Update are effective for fiscal years beginning after December 15, 2022, including interim periods within those ~~fiscal~~ years. Early ~~adoption~~application of the guidance is ~~permitted.~~permitted for all entities for fiscal years beginning after December 15, 2018, including the interim periods within those fiscal years. Application of the amendments is through a cumulative-effect adjustment to retained earnings as of the effective date. The Company is currently evaluating the impact of this update on the condensed consolidated financial statements.

In December 2019, the FASB issued ASU 2019-12, "Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes" (ASU 2019-12), which eliminates certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. This ASU also includes guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. ASU 2019-12 is effective for annual and interim periods in fiscal years beginning after December 15, 2020. Early adoption is permitted. The Company is currently assessing the impact of ASU 2019-12 on its consolidated financial statements.

In February 2016, the FASB established Topic 842, Leases, by issuing Accounting Standards Update (ASU) No. 2016-02, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU No. 2018-10, Codification Improvements to Topic 842, Leases; and ASU No. 2018-11, Targeted Improvements. The new standard establishes a right-of-use model (ROU) that requires a lessee to recognize a ROU asset and lease liability on the balance sheet for all leases with a term longer than 12 months. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement.

The new standard was effective for us on July 1, 2019. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (1) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. We used the effective date as our date of initial application. Consequently, financial information was not updated, and the disclosures required under the new standard were not provided for dates and periods before July 1, 2019.

The new standard provides a number of optional practical expedients in transition. We elected the ‘package of practical expedients’, which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. We elected all of the new standard’s available transition practical expedients that are applicable.

The new standard also provides practical expedients for an entity’s ongoing accounting. We elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, we will not recognize ROU assets or lease liabilities, and this includes not recognizing ROU assets or lease liabilities for existing short-term leases of those assets in transition. We also elected the practical expedient to not separate lease and non-lease components for all of our leases, other than for leases of real estate.

On August 22, 2018, the Company entered into an agreement captioned “Securities Purchase Agreement” with the members of Inception DX, LLC (“Inception”), a Utah limited liability company. Under the terms of the agreement, the Company acquired Inception for 15,500,000 shares of common stock. Inception owns laboratory equipment, partial interest in database records for over 31,900,000 individuals for use in genetics research, 400,000 units in Juneau Biosciences, LLC, initial CLIA registration, CLIA lab protocols, and other assets. Once the CLIA registration is completed, Inception will be used as a CLIA-certified laboratory by Predictive Technology Group, Inc. and its affiliates.

The stock issued was for cash, laboratory equipment, membership units in Juneau Biosciences, LLC (“Juneau units”), and trade secrets related to the DNA database and protocols related to a future use as a CLIA laboratory. The Juneau units were valued based on the value assigned when the Company entered into a subscription to purchase units of Juneau ($1.10 per unit). The equipment will be depreciated over 5 years. The proprietary data, DNA library, protocols, research and methods are classified as trade secrets in our industry. The Company will amortize the trade secrets over an estimated useful life of 15 years.

~~The stock price on August 22, 2018 was $0.92 per share, indicating a purchase price of $14,260,000 requiring allocation:~~

On August 22, 2018, the Company entered into an agreement captioned “Asset Purchase Agreement” (the “Purchase Agreement”) with Taueret Laboratories, LLC and its members. Under the terms of the Purchase Agreement, the Company issued warrants exercisable for 16,500,000 shares of the Company’s common stock. The warrants were exercisable at fair market value of the Company’s common stock on the closing date. In consideration for the warrants, the Company acquired (i) approximately 1,000 degenerative disc disease related DNA samples, related family records, relevant clinical records (including approximately 600 affected probands) and 800 ancestry matched control samples, (ii) whole exome sequencing data on approximately 300 degenerative disc disease samples, over 800 local controls, and published reference populations, together with initial analysis of the markers, (iii) project plan, study paperwork, promotional study and materials used in the research study, (iv) exclusive use of a DNA biobank that has a collection of over 300,000 samples for multiple diseases that the Company may target, (v) the remaining interest in database records for over 31,900,000 individuals for use in genetics research, and (vi) other assets.

The warrants issued are for proprietary data and methods that are otherwise a trade secret in our industry. Therefore, the Company determined to classify the assets purchased as trade secrets with a 15-year life. The Company used a Black Scholes calculation to determine valuation of the warrants of $13,860,000. As the purchase of the trade secrets with common stock warrants resulted in a difference between book and tax basis in the trade secrets, the carrying amount of the trade secrets was increased to $18,480,000 to reflect the deferred tax liability of $4,620,000 assumed in the transaction.

~~The fair value of the warrants was determined using the following inputs to the Black Scholes model:~~

~~Expected volatility was calculated from the historical volatility of the Company’s common stock.~~

On December 19, 2018 the Company executed a merger with the shareholders of Regenerative Medical Technologies, Inc. (“RMT”), a Utah corporation. The Company acquired RMT for 10,000,000 shares of common stock. RMT holds various assets including (i) models, methods and protocols for collection of birthing tissue and DNA samples, (ii) patient registry models, methods and protocols to collect clinical outcomes and electronic medical records, and (iii) designs and methodologies relating to many initiatives that are complementary to anticipated product offerings and ongoing research, and (iv) other assets.

The fair value of consideration paid was determined based on our stock price of $0.92 on the date of acquisition. In addition, the Company recognized a deferred tax liability of $3,066,667 related to the differences between book and tax basis arising from the acquisition, resulting in a total purchase price of $12,266,667. The Company determined that the assets acquired qualify for treatment as trade secrets within industry. The trade secrets will be amortized over an estimated useful life of 10 years.

On March 22, 2019, the Company completed the acquisition of Taueret Laboratories, LLC (“Taueret”) pursuant to the Securities Purchase Agreement (as amended, the “Purchase Agreement”), dated January 1, 2019. Pursuant to the terms of the Purchase Agreement, the Company acquired all of the outstanding units of Taueret. The Company and its affiliates plan to use Taueret’s CLIA-certified laboratory to perform diagnostic testing services.

The Purchase Agreement also specifies that the Company may, at its sole discretion, put certain patents related to the diagnosis and treatment of Preeclampsia (the “Preeclampsia IP”) back to the members of Taueret at any time prior to December 31, 2020 (the “Preeclampsia Option”). On December 31, 2020, an additional payment of $8,547,000 in cash will become due if the Company has not exercised the Preeclampsia Option. After considering the relevant accounting guidance, we determined that the Preeclampsia Option was not part of the business combination with Taueret, because the Preeclampsia Option was included in the Purchase Agreement primarily to benefit the acquirer.

The Company acquired Taueret and the Preeclampsia Option for total consideration of $931,817, net of cash acquired of $85,964. The consideration was paid as 552,995 shares of the Company’s common stock. The common stock was valued at the closing price on the date of the closing of the merger, adjusted for a 20% discount for lack of marketability related to a contractually stipulated lockup provision with a period of one year. The consideration was allocated between the business combination and the Preeclampsia Option on a relative fair value basis with $917,511 allocated to the business combination and $100,000allocated to the Preeclampsia Option. The Preeclampsia Option was recorded in intangible assets and will be amortized on a straight-line basis over the period the option is exercisable.

~~Total consideration transferred was allocated to tangible and intangible assets acquired and liabilities assumed based on their fair values as of the acquisition date.~~

Management estimated the fair value of tangible and intangible assets and liabilities in accordance with the applicable accounting guidance for business combinations and utilized the services of third-party valuation consultants. These amounts are provisional and may be adjusted during the measurement period, which expires no later than one year from the acquisition date, if new information is obtained that, if known, would have affected the amounts recognized as of the acquisition date.

The Company acquired intangible assets that consisted of an internally developed laboratory information management system which had an estimated fair value of $239,000, CLIA regulatory licenses with a fair value of $295,000, and customer relationships with a fair value of $16,000. The fair value of the software was determined using the replacement cost method. The fair value of the CLIA licenses were estimated using the excess earnings method. The estimated net cash flows were discounted using a discount rate of 22%, which is based on the estimated internal rate of return for the acquisition and represents the rate that market participants might use to value the intangible assets. The projected cash flows were based on key assumptions such as estimates of revenues and operating profits. The Company will amortize the intangible assets on a straight-line basis over their estimated useful lives of 15 years for the CLIA license and 5 years for the software and customer relationships. This amortization is deductible for income tax purposes.

Any excess of fair value of acquired net assets over the purchase price (negative goodwill) has been recognized as a gain in the period the acquisition was completed. We have reassessed whether all acquired assets and assumed liabilities have been identified and recognized and performed remeasurements to verify that the consideration paid, assets acquired, and liabilities assumed have been properly valued. The remaining excess has been recognized as a gain in other income and expense in the consolidated statement of operations. The bargain purchase gain partly resulted from the allocation of the total consideration between the business combination and the Preeclampsia Option. We also believe we were able to negotiate a bargain price due to the desire of the sellers to induce the Company to purchase the Preeclampsia Option contemporaneously with the business combination.


		As of		As of		As of		As of
		March 31,		June 30,		September 30,		June 30,
		2020		2019		2020		2020
Computer equipment	$	734,601	$	530,815	$	779,107	$	759,192
Furniture		230,747		224,324		230,747		230,747
Lab equipment		2,215,409		2,469,652		2,610,555		2,215,409
Software		928,369		923,369		1,006,215		1,006,215
Leasehold improvements		1,006,215		870,098		1,008,713		1,008,713
Other fixed assets in progress		183,937		69,886		18,943		91,195
Lab equipment subject to finance lease		2,774,907		2,774,907		2,774,907		2,774,907
Total property, plant, and equipment		8,074,185		7,863,051		8,429,187		8,086,378

Accumulated depreciation		(1,925,919)		(862,851)		(2,358,819)		(2,022,744)
Accumulated depreciation – leased assets		(401,766)		(25,759)
Accumulated depreciation - leased assets						(972,873)		(758,535)

Property, plant and equipment, net	$	5,746,500	$	6,974,441	$	5,097,495	$	5,305,099

Depreciation expense for the three-month periods ended ~~March 31,~~September 30, 2020 and 2019 was ~~$510,473and $149,776, respectively. Depreciation expense for~~$550,413 and $381,886, respectively, of which $214,338 and $25,759 related to the ~~nine-month periods ended March 31, 2020 and 2019 was $1,439,074and $358,790, respectively.~~amortization of assets recorded under finance leases.

Intangible assets primarily consist of amortizable purchased licenses, patents, and trade secrets. The following summarizes the amounts reported as intangible assets:


	Carrying Amount		Accumulated Amortization			Net	Weighted Average Remaining Amortization Period (Years)	Carrying Amount		Accumulated Amortization			Net	Weighted Average Remaining Amortization Period (Years)
At March 31, 2020:
At June 30, 2020:
Licenses	$	21,337,981	$	(4,773,856)	$	16,564,125	8.3	$	21,337,981	$	(5,273,253)	$	16,064,728	8.0
Patents		9,750,000		(3,473,039)		6,276,961	8.3		9,750,000		(3,664,215)		6,085,785	8.0
Trade Secrets		56,675,936		(15,883,350)		40,792,586	8.2		46,634,380		(17,397,933)		29,236,447	7.9
Other		411,000		(96,010)		314,990	10.2		411,000		(115,212)		295,788	10.0
Goodwill		5,254,451		N/A		5,254,451	N/A		5,254,451		N/A		5,254,451	N/A
Total intangible assets	$	93,429,368	$	(24,226,255)	$	69,203,113	8.3	$	83,387,812	$	(26,450,613)	$	56,937,199	8.0

Estimated future amortization expense related to intangible assets consists of the following as of ~~March 31,~~September 30, 2020:

Total amortization expense for the three months ended ~~March 31,~~September 30, 2020 and 2019 was ~~$2,227,692~~$1,933,670 and ~~$2,224,230respectively. Total amortization expense~~$2,228,359 respectively.

As of June 30, 2020, the Company identified indicators of impairment related to the assets acquired with Regenerative Medical Technologies, Inc. Specifically, development of the assets acquired has proceeded significantly more slowly than originally planned due to the departure of key personnel and related difficulties in obtaining patient consent required to use the acquired assets in the Company's research activities. The Company determined the fair value of the assets acquired to be $334,000 using the cost to recreate method, which resulted in an impairment charge of $10,041,556 for the ~~nine~~year ended June 30, 2020. This valuation approach uses inputs that qualify as Level 3 in the fair value hierarchy. The impaired assets and the related impairment charge in included in the Diagnostics and Therapeutics segment.

In October 2020, the Company stopped selling its CoreCyte product in connection with the decision to accelerate the Company's previously existing plan to file an Investigational New Drug (IND) application for CoreCyte with the FDA. The Company submitted documentation to begin the process of filing the IND on October 30, 2020 in which CoreCyte is indicated for the treatment of osteoarthritis of the knee. As the sequence of events that led to this decision began with the receipt of a Warning Letter from the FDA in August 2020, it was determined that the decision to stop selling CoreCyte was an indicator of impairment as of September 30, 2020. The Company estimated the fair value of the reporting unit using the discounted cash flow method, as the forecasted cash flows during the remaining economic life of the trade secrets (less than one year) were forecasted to be negative. This valuation approach uses inputs that qualify as Level 3 in the fair value hierarchy. As a result, an impairment charge of $1,760,875 was recognized related to the trade secrets in the HCT/P segment in loss on impairment in the condensed consolidated statement of operations and comprehensive loss. There were no impairments for the three months ended ~~March 31, 2020 and 2019 was $6,684,410 and $5,716,300respectively.~~September 30, 2019.

On December 28, 2016, Predictive Therapeutics ~~LLC~~ and Juneau amended and restated the license agreement dated July 9, 2015. The license granted the Company the right to market the Company's diagnostic testing products in the field of fertility and use the patents underlying those products. The license was subsequently amended in March 2018 to expand the scope of the license to include the entire field of endometriosis and pelvic pain. The term of the license is equal to the life of the licensed patents.

An additional license fee of $2,000,000 is due and payable once the Company has received profits of $25,000,000 related to the intellectual property licensed under the agreement.

Under the license, as amended, (i) upon the commercial sale of the ~~licensed assay,~~rights to the ~~Company will~~ARTguide™ or a license thereof we are required to issue to Juneau common ~~shares~~stock with a market value of ~~$2,500,000.~~$2,500,000, (ii) Juneau ~~is entitled to~~receives a royalty ~~equal to~~of 50% of net ~~sales, adjusted to exclude certain costs and fees, and subject to certain minimums.~~

In March of 2018, the Company’s licenses with Juneau were amended to reduce the royalty rate and expand the scope of the licenses to include the entire field of endometriosis and pelvic pain. The Company issued 1,000,000 shares of common stock and 14,000,000 warrants with an exercise price of $0.80 per shareprofits as ~~consideration.~~

In December of 2018, the Company and Juneau agreed to renegotiate the price paid for the license. The warrants issued initially for this license agreement were cancelled, and new warrants were issued with an increased exercise price of $0.90 per share, resultingdefined in ~~a decrease in the value assigned to~~ the license agreement, (iii) we must have minimum sales of ~~$4,449,211. The replacement of the warrants resulted in an additional deferred tax liability of $290,263, resulting in a net decrease~~$12.5 million in the ~~carrying value~~twelve month period beginning nine months after commercial launch, (iv) during the second year following launch we must have minimum sales of $30 million, and (v) during the ~~licenses~~third year following launch and each year thereafter we must have minimum annual sales of ~~$4,158,948. There was~~$60 million. If we fail to meet these metrics the license is null and void unless Predictive (a) presents written plan to Juneau describing how Predictive will use reasonable commercial efforts to improve sales and (b) Predictive agrees to spend an ~~associated adjustment to amortization expense. The fair value of the replacement warrants were determined using the following inputs~~amount equal to the ~~Black Scholes model:~~difference between the projected minimum sales and actual sales on an enhanced sales and marketing effort over the next year.

In addition to the license for the commercialization of assays and related services for the prognosis and monitoring of endometriosis in the infertility market, the Company entered into a license agreement with Juneau to use the assay as a companion diagnostic test in conjunction with endometriosis therapeutics that may be developed from intellectual property owned by the Company and Juneau. ~~Once~~This license agreement was amended and restated on August 1, 2016.

The agreement initially required a $250,000 license fee which was paid during 2013 and 2014. A subsequent milestone payment of 250,000 shares of Company stock was paid to Juneau on October 19, 2016. If FDA approval is granted on any companion diagnostic test, a final milestone payment of $250,000 is due.

The agreement requires a 2% royalty to be paid to Juneau on the sale of patented therapeutic products specifically covered by the agreement.

We recorded goodwill of $5,254,451 from the acquisition of Predictive Biotech, Inc. (formerly Renovo Biotech, Inc.) that was completed on March 28, 2016.

In October 2020, the Company stopped selling its CoreCyte product in connection with the decision to accelerate the Company's previously existing plan to file an Investigational New Drug (IND) application for CoreCyte with the FDA. The Company submitted documentation to begin the process of filing the IND on October 30, 2020, in which CoreCyte is indicated for the treatment of osteoarthritis of the knee. As the sequence of events that led to this decision began with the receipt of a Warning Letter from the FDA in August 2020, it was determined that the decision to stop selling CoreCyte was an indicator of impairment as of September 30, 2020. The Company estimated the fair value of the reporting unit using the discounted cash flow method. This valuation approach uses inputs that qualify as Level 3 in the fair value hierarchy. ��The fair value of the reporting unit was determined to have fallen below its carrying value, which resulted an impairment charge of $5,254,451 that was recognized in the HCT/P segment in loss on impairment in the condensed consolidated statement of operations and comprehensive loss. There were no impairments of goodwill for the three months ended September 30, 2019.

Changes in the goodwill balance during the three months ended September 30, 2020 were as follows.

The ~~Company’s~~Company's investment in Juneau is accounted for under the equity ~~method and included in the Diagnostics and Therapeutics segment.~~method. The following table summarizes the investment:



					As of September 30, 2020		As of June 30, 2020
	As of March 31, 2020		As of June 30, 2019
Carrying amount	$	34,947,717	$	51,717,719	$	11,961,538	$	12,731,383

Ownership percentage		48.3%		48.4%		48.3%		48.3%

In December 2017, the Company and Juneau reached verbal agreement on a stock subscription arrangement. The Company agreed to purchase 15,681,818 Class A Units of Juneau at a price of $1.10 per unit. In early 2018, the terms were finalized and memorialized in a subscription agreement executed by the Company and Juneau. Under the terms of the agreement (as amended), the subscription is to be paid in installments through September 30, 2021. The Company has the option to cancel the subscription. If this option is exercised, any units of Juneau issued to the Company but not paid will be cancelled. The agreement includes certain restrictions on the use of funds provided under the subscription agreement and grants the Company the right to appoint a minority of ~~Juneau’s~~Juneau's Board of Managers. Should the Company elect not to fund the entire subscription, ~~Juneau’s~~Juneau's obligations to the Company that are not related to the license agreements (see Note 5)3) will terminate.

On September 25, 2019, the Company and Juneau executed an amendment to the subscription agreement. The amendment reduced the total number of Class A Units purchased to 13,000,000 and changed the schedule of payments due under the subscription agreement. In addition, a receivable due from Juneau in the amount of $184,443 was applied to the subscription payable balance.

On February 10, 2020, the Company and Juneau Biosciences, LLC, its equity method investee, executed an amendment to the agreement captioned ~~“Third~~"Third Amended and Restated Subscription Agreement.”" Under the terms of the agreement, the Company issued common stock, par value $0.001, with a value of $2,430,000 (the ~~“Equity Payment”~~"Equity Payment") based on the closing market price on the agreement date that was applied against the subscription payable. The amendment also changed the schedule of cash payments due under the subscription agreement to purchase units of Juneau. The schedule of payments as of ~~March 31,~~September 30, 2020 under the amended agreement is as follows:


Year Ending June 30		Amount		Amount
2020	$	550,000
2021		4,600,000		5,110,253
2022		2,056,610		2,056,610
	$	7,206,610	$	7,166,863

The Company is currently $960,000 in arrears on payment on the subscription. Should Juneau declare the Company in default and cancel the subscription, our unpaid units of Juneau would be cancelled.

~~Summarized financial information for the Company’s equity method investee as of and for its fiscal year end is presented in the following tables:~~

The Company reviews its equity method investment on a quarterly basis to determine whether a triggering event has occurred that could necessitate an impairment test. During the three months ended December 31, 2019, the ~~Company’s~~Company's stock price declined from $1.67 per share to $0.73 per share, which was determined to qualify as a triggering event for impairment tests of our reporting units, intangible assets, and equity method investments. In addition, there had been delays in the commercialization of product licensed from Juneau. At June 30, 2020, the COVID-19 pandemic caused impediments to clinical research which are expected to further delay the commercialization of our genetic testing products. These factors triggered a second impairment test as of June 30, 2020.

For each of the impairment tests as of December 31, 2019 and June 30, 2020, we engaged a third-party valuation firm to assist us in determining whether the carrying value of our equity method investment had fallen below the carrying value. The ~~valuation was~~valuations were performed using a combination of the cost approach, the income approach, and calibration of the fair values of the ~~Company’s~~Company's operating segments and equity method investment to the ~~Company’s~~Company's overall market capitalization. These valuation approaches use inputs that qualify as Level 3 in the fair value hierarchy. As a result of the valuation, it was determined that the fair value of our equity method investment had fallen to $35,329,167 at December 31, 2019, necessitating an impairment charge of ~~$15,932,016.~~$15,932,016 during the three months ended December 31, 2019. At June 30, 2020, it was determined that the fair value of our equity method investment had fallen to $12,731,383, necessitating a further impairment charge of $21,975,267. The total impairment ~~charge is~~charges of $37,907,283 are included in ~~Loss~~loss on equity method investment in the condensed consolidated statement of operations for the ~~nine months~~year ended ~~March 31,~~June 30, 2020. The ~~impairment was~~impairments were determined to be other than temporary based on the magnitude of the decline in fair value.

There were no impairments ~~for~~during the three months ended ~~March 31,~~September 30, 2020 ~~nor for the three and nine months ended March 31, 2019.~~or 2019, respectively.

The customer deposit of $5,000,000 relates to a partial deposit received from the distributor of the Company's Assurance AB(tm) product. Under the terms of the agreement with the distributor, the purchase order may not be cancelled and product may only be returned if damaged in transit or subject to a recall order. In an effort to expeditiously satisfy the Company's obligations under the agreement with the distributor, the Company paid the full amount of the partial deposit to the Company's U.S. supplier. The deposit paid to the supplier is included in other current assets on the condensed consolidated balance sheets. If the Company does not receive Emergency Use Authorization from the FDA, the deposit paid to the Company's supplier may become impaired. The Company will fulfill the purchase order upon receipt of the remaining deposit amount due from the distributor under the distribution agreement. As of the date of the financial statements, no additional deposits have been made. The customer has requested a refund of the deposit. See further discussion in Note 11. As of the date of this filing, the Company has withdrawn its original EUA application and is re-filing an application for a revised COVID lateral flow assay tailored for use in preparing for near-term COVID immunity and vaccine related priorities.

As of September 30, 2020, unsecured promissory notes ~~to six accredited investors in the total amount~~with a face value of ~~$9,360,000.~~$2,600,000 were outstanding. The ~~promissory~~ notes bear 12% simple interest and mature from November 2021 to March 2022.

On June 4, 2020, trade payables due to a vendor in the amount of $705,234 were converted into an unsecured note payable due on November 15, 2020. The note bears interest at 3% per annum, increasing to 5% if the note is not paid when otherwise due.

In July and August 2020, the Company issued promissory notes to an accredited investor in the amount of $1,000,000. The notes bear interest at 15% per annum and mature on September 21, 2020. The notes are secured by the revenues arising from the Company's Assurance VR™ COVID-19 RT-PCR test.

On September 25, 2020, the Company and the same accredited investor amended and restated the outstanding notes and increased the principal amount by $2,000,000 to a total of $3,000,000. The amended promissory note bears 15% simple interest. No payments on the ~~two-year anniversary~~amended promissory note are due until September 2021, at which time monthly payments equal to 1/36th of ~~each note.~~the outstanding principal and interest amount shall commence. Interest accruing prior to September 2021 will be added to the principal amount. Any remaining principal and interest shall be due on September 30, 2022. The ~~notes~~amended promissory note is secured by the revenues arising from the Company's Assurance VR™ COVID-19 RT-PCR test and may be ~~repaid~~prepaid without penalty.

The Company entered into a Consulting Agreement with the same accredited investor on the same date that the promissory notes were amended. The Company will provide various services in connection with the accredited investor's COVID-19 testing business, including technical consultation and sales lead generation. The Company may earn up to $1,000,000 in milestone payments and shall earn a commission of 5% of the accredited investor's sales from performing COVID-19 testing generated from sales leads provided by the Company. Amounts earned under the Consulting Agreement shall first be applied to any balance outstanding under the amended promissory notes. The Company's total compensation under the Consulting Agreement is capped at ~~any time.~~$4,000,000. The agreement may be cancelled by the accredited investor without penalty.

In September 2019, the Company and an accredited investor entered into a Revolving Loan Agreement whereby the accredited investor agreed to lend the Company up to ~~an additional~~ $3,000,000. At September 30, 2020, $200,000 is outstanding and $2,800,000 is available. Amounts drawn under the revolving loan will be charged interest at a rate of 12% and may be repaid at any time. All amounts outstanding under the revolving loan are due upon the expiration of the revolving loan facility on September 30, 2021. ~~There was $200,000 outstanding~~

On May 6, 2020, Company received loan proceeds of $1,665,985 under the ~~Revolving Loan Agreement~~Paycheck Protection Program ("PPP") under a promissory note from a commercial bank (the "PPP Loan"). The PPP, established as part of ~~March 31, 2020.~~the CARES Act, provides for loans to qualifying businesses for amounts up to 2.5 times the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after eight weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels.

The application for these funds requires the Company to, ~~accept repayment~~ in ~~equity shares for promissory notes with a face value~~good faith, certify that the current economic uncertainty made the loan request necessary to support the ongoing operations of ~~$8,420,000~~the Company. Some of the uncertainties related to the Company's operations that are directly related to COVID-19 include, but are not limited to, the severity of the virus, the duration of the outbreak, governmental, business or other actions (which could include limitations on operations or mandates to provide products or services), impacts on the supply chain, and the ~~$720,000 outstanding under~~effect on customer demand or changes to operations. In addition, the health of the ~~Revolving~~Company's workforce and its ability to meet staffing needs are uncertain and is vital to its operations.

The PPP Loan ~~Agreement, as well as $311,918 in accrued interest thereon. For accounting purposes, the debt was not considered extinguished until~~certification further requires the Company ~~administratively issued~~to take into account our current business activity and our ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the shares during the quarter ended March 31, 2020. The debt was extinguished in full by issuing 12,947,833 shares of the Company’s common stock based on the closing market price on December 31, 2019 of $0.73 per share.

~~During the quarter ended March 31, 2020,~~business. While the Company ~~borrowed $200,000~~does have availability under its Revolving Loan Agreement, the $2.8 million that is available is in place to support working capital needs, along with ~~an accredited investor.~~ current cash on hand. Further, the Company has a lack of history of being able to access the capital markets. As a result, the Company believes it meets the certification requirements.

The ~~Company also borrowed an additional $1,660,000 under promissory notes with a second accredited investor. The promissory notes bear 12% simple interest~~receipt of these funds, and ~~matures~~the forgiveness of the loan attendant to these funds, is dependent on the ~~two-year anniversary~~Company having initially qualified for the loan and qualifying for the forgiveness of such loan based on our future adherence to the forgiveness criteria.

The term of the ~~note.~~Company's PPP Loan is two years. The ~~notes may be repaid at any time.~~

Asannual interest rate on the PPP Loan is 1% and no payments of ~~March 31, 2020, unsecured promissory notes bearing 12%~~principal or interest ~~with a face value of $2,600,000 remain outstanding. The notes mature from June 2021 to March 2022. Notes with a face value of $400,000 mature~~are due during the ~~fiscal year ended June 30, 2021, with~~six-month period beginning on the ~~remainder maturing during~~date of the ~~fiscal year ended June 30, 2022.~~PPP Loan. The PPP Loan is subject to any new guidance and new requirements released by the Department of the Treasury.

The fair value of the ~~Company’s~~Company's outstanding debt obligations as of ~~March 31,~~September 30, 2020 was ~~$2,574,000,~~$7,904,000, which was determined based on a discounted cash flow model using an estimated market rate of interest of ~~18.2%~~15.0%, which is classified as Level 2 within the fair value hierarchy.

In order to determine the Company’s quarterly provision for income taxes, the Company used an estimated annual effective tax rate that is based on expected annual income and applicable federal and state tax rates. The Tax Cuts and Jobs Act reduced the federal corporate tax rate to 21% in the fiscal year ended June 30, 2019. Section 15 of the Internal Revenue Code stipulates that the Company’s fiscal year ended June 30, 2019, had a blended corporate tax rate of 28%, which is based on the applicable tax rates before and after the Tax Act and the number of days in the year. For the fiscal years ending after June 30, 2019, the Company’s federal corporate tax rate is 21%. Certain significant or unusual items are separately recognized in the quarter during which they occur and can be a source of variability in the effective tax rate from quarter to quarter.

The Company recognized ~~a provision for~~ income ~~taxes~~tax expense (benefit) of ~~$1,257,868~~$1,052 and ~~a benefit from income taxes of $1,215,312~~($5,208,418) for the three-month periods ended ~~March 31,~~September 30, 2020 and 2019, respectively. The ~~Company recognized income tax benefits of $8,190,327 and $2,541,290 for the nine-month periods ended March 31, 2020 and 2019, respectively. The Company’s~~Company's recognized effective tax rate differs from the U.S. federal statutory rate for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 primarily due to state income taxes and share based compensation, ~~excess tax benefits arising from the exercise of commons stock warrants during the period, as well as an increase~~offset by changes in the valuation allowance onin deferred tax assets. The ~~Company’s~~Company's recognized effective tax rate differs from the U.S. federal statutory rate for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2019 primarily due to state income taxes, ~~and~~ share based ~~compensation.~~compensation and excess tax benefits arising from the exercise of commons stock warrants during the period.

The Company has issued various warrants exercisable for our common stock outside of the 2015 Stock Option Plan (see Note ~~12)~~10). The warrants were issued to raise capital, as compensation for acquisitions of intellectual property, and as compensation for services.

On July 16, 2019 and August 1, 2019, a total of 11,000,000 common stock warrants issued to FlagshipSailsRx, LLC, our former sales and marketing contractor, were exercised pursuant to a cashless exercise feature. The cashless exercise resulted in the issuance of 9,172,157 shares of common stock and the cancellation of 1,827,843 warrants as consideration for the exercise price.

In September 2019, the Company entered into an agreement with a consultant for research and development services. In consideration for these services, the Company granted warrants to the consultant exercisable for 1,250,000 shares of the Company’s common stock with a strike price equal to the closing price of the Company’s common stock on the date of grant. Warrants to acquire 625,000 shares vested upon issuance. Of the remaining warrants, 375,000 vest on March 1, 2020 and 225,000 vest on September 1, 2020. The warrants expire ten years from the date of issuance.

~~On January 29, 2020, the Company sold 500,000 shares of our common stock, par value $0.001, to an accredited investor at a price of $0.96 per share.~~

The following is a summary of warrant activity from June 30, ~~2019~~2020 through ~~March 31,~~September 30, 2020:

The Company recognizes expense for warrants issued for services that are subject to graded vesting on a straight-line basis. Share based compensation expense related to warrants issued for services for the three months ended ~~March 31,~~September 30, 2020 and 2019 was ~~$257,573~~$441,691 and ~~$2,093,333,~~$1,890,213, respectively. ~~Share based compensation expense related to warrants issued for services for the nine months ended March 31, 2020 and 2019 was $3,508,957 and $3,038,111, respectively.~~

As of ~~March 31,~~September 30, 2020, unrecognized compensation cost related to warrants issued for services was ~~$886,515~~$82,500 and is expected to be recognized over a weighted average period of ~~0.57~~1.33 years.

The computation of weighted average shares outstanding and the basic and diluted ~~loss~~earnings per common share for the following periods consisted of the following:


		Weighted
	Net	Average Shares	Per Share		Weighted
	Loss	Outstanding	Amount	Net	Average Shares	Per Share
Three months ended March 31, 2020
				Loss	Outstanding	Amount
Three months ended September 30, 2020				Three months ended September 30, 2020
Basic and diluted EPS attributable to common shareholders	$(13,700,980)	294,685,635	$(0.05)	$(15,460,064)	299,596,808	$(0.05)
Three months ended March 31, 2019
Three months ended September 30, 2019				Three months ended September 30, 2019
Basic and diluted EPS attributable to common shareholders	$(3,708,911)	272,029,651	$(0.01)	$(7,864,607)	281,027,491	$(0.03)
Nine months ended March 31, 2020
Basic and diluted EPS attributable to common shareholders	$(47,568,256)	293,866,529	$(0.16)
Nine months ended March 31, 2019
Basic and diluted EPS attributable to common shareholders	$(8,042,731)	263,060,001	$(0.03)

Potentially dilutive securities that would be excluded from the calculation of diluted net loss per common share because to include them would be anti-dilutive are as follows:

In 2015, a Stock Option Plan was adopted to advance the interests of the Company and its shareholders by helping the Company obtain and retain the services of employees, officers, consultants, independent contractors and directors, upon whose judgment, initiative and efforts the Company is substantially dependent, and to provide those persons with further incentives to advance the interests of the Company. Eligible participants include employees, officers, certain consultants, or directors of the Company or its subsidiaries.

The number of shares, terms, and vesting periods are determined by the ~~Company’s~~Company's Board of Directors or a committee thereof on an award-by-award basis. Awards provided under the Plan generally vest in three equal annual installments. The maximum term of options issued under the plan is 10 years from the date of grant. The aggregate number of shares of Option Stock that may be issued pursuant to the exercise of Options granted under this Plan will not exceed fifteen percent (15%) of the total outstanding shares of the Company's common stock. The Company settles exercises of stock option awards by issuing new shares. Forfeitures are recognized as they occur.

A summary of option activity is as follows for the ~~nine~~three months ended ~~March 31,~~September 30, 2020:


		Number of shares		Weighted average exercise price		Number of shares		Weighted average exercise price
Options outstanding at June 30, 2019		24,407,750	$	1.74
Options outstanding at June 30, 2020					Options outstanding at June 30, 2020	30,014,704	$	1.47
Options granted	Options granted	8,741,954		0.82	Options granted	15,000		0.44
Less:	Less:				Less:
	Options exercised	-		-	Options exercised	-		-
	Options canceled or expired	(2,268,600)		1.80	Options canceled or expired	(1,973,971)		1.29
Options outstanding at end of period		30,881,104	$	1.48
Options outstanding at September 30, 2020					Options outstanding at September 30, 2020	28,055,733	$	1.48

Share based compensation expense related to options issued under the 2015 Plan for the three months ended ~~March 31,~~September 30, 2020 and 2019 was ~~$3,477,445~~$2,494,889 and ~~$162,806, respectively. Share based compensation expense related to options issued under the 2015 Plan for the nine months ended March 31, 2020 and 2019 was $9,854,730 and $1,101,433,~~$3,104,387, respectively.

On January 2, 2020, the Company issued 150,000 stock option awards with a strike price of $0.88 to employees of Juneau Biosciences, LLC, our equity method investee. The awards vested immediately. Additional share based compensation expense related to these awards of $270,000 is included in loss on equity method investment in the statement of operations for the three and nine months ended March 31, 2020.

On March 21, 2020, the Company issued 5,000,000 stock option awards with a strike price of $0.44 to a consultant in connection with development of the Assurance AB™ COVID-19 antibody test. Options totaling 1,000,000 vested immediately, with the remaining 4,000,000 options vesting in three equal annual installments. The remaining 4,000,000 options may also vest on an accelerated basis in tranches of 1,000,000 options when the Company recognizes cumulative revenues from COVID-19 tests of $25 million, $50 million, $75 million, and $100 million.

The Company recognizes expense for awards subject to graded vesting on a straight-line basis. As of ~~March 31,~~September 30, 2020, there was ~~$26,406,836of~~$16,975,429 of total unrecognized share-based compensation expense related to stock options issued under the 2015 Stock Option Plan that will be recognized over a weighted-average period of ~~2.25~~1.77 years.

The Company has commitments under license agreements which are described in Note 5.3.

On October 10, 2019, substantially all of the ~~Company’s~~Company's operating leases of office and laboratory space were amended to extend the expiration dates of the leases to September 30, 2021. The Company also leased an additional 6,711 square feet of office and storage space that commenced on November 1, 2019 and expires on September 30, 2021.

In March 2019, the Company entered into finance leases of laboratory equipment. The validation process for the leased equipment was completed and payments commenced in October 2019. The leases expire in September ~~2022,~~2023, at which time the Company has the option to purchase the leased equipment for one dollar.

The table below presents the future ~~minimum~~maturities of lease ~~payments~~obligations under operating and finance leases:



Year Ending June 30,		Operating		Finance		Total		Operating		Finance		Total
2020	$	238,408	$	196,545	$	434,953
2021		979,071		748,361		1,727,432		740,663		555,597		1,296,260
2022		246,888		740,797		987,685		246,888		740,798		987,686
2023		-		167,719		167,719		-		167,719		167,719
2024		-		-		-		-		-		-
2025								-		-		-
Total cash payments		1,464,367		1,853,422		3,317,789		987,551		1,464,114		2,451,665
Less: Imputed interest		(96,126)		(178,686)		(274,813)		(44,662)		(116,169)		(160,831)
Total lease liability	$	1,368,241	$	1,674,736	$	3,042,976	$	942,889	$	1,347,945	$	2,290,834

Lease information for the three months ended ~~March 31,~~September 30, 2020 and 2019 is as follows:

~~Lease expense under operating leases was $169,044 and $328,124for the three- and nine-month periods ended March 31, 2019, respectively.~~

In March 2019, in connection with the lease of laboratory equipment described above, the Company agreed to purchase a fixed quantity of the consumables used by the equipment for a total of $1,386,710. The Company is obligated to pay for the consumables in twelve fixed monthly installments beginning in October 2019. At ~~March 31,~~September 30, 2020, the Company had taken delivery of consumables worth ~~$209,468~~$93,909 in excess of the installment amounts paid. The amount due for goods that have been delivered is included in accrued liabilities on the condensed consolidated balance sheet. Remaining payments due under the purchase commitment total ~~$346,677 during the year ending June 30, 2020 and $346,677~~$577,795 during the year ending June 30, 2021.

On or about July 13, 2018, RTJ, LLC and two of its principals filed a lawsuit against Predictive Therapeutics LLC, Predictive Biotech, Inc., both subsidiaries of Predictive Technology Group, Inc., and Jack Turner, Jr., an employee of Predictive Biotech, Inc. The plaintiffs had acted in a distributor capacity. The relationship was terminated. Plaintiffs are alleging breach of contract, promissory estoppel, unjust enrichment, fraud, breach of fiduciary duty, defamation, false light, and tortious interference. Based on the information available to us, we do not believe any of the RTJ proceedings will have a material adverse effect on our business, results of operations, financial position, or liquidity. Further, we deny the allegations in the complaint, have not discovered any evidence of wrongdoing with respect to the allegations and will vigorously defend against these allegations.

On or about May 1, 2019, Surgenex, LLC and one of its principals filed a lawsuit against Predictive Therapeutics LLC, Predictive Biotech, Inc., both subsidiaries of Predictive Technology Group, Inc., and Doug Schmid, an employee of Predictive Biotech, Inc. In 2014 Surgenex contracted with Utah Cord Bank, Inc., a former employer of Doug Schmid, to assist Surgenex in the doing work relating to allograft tissue. Schmid was later hired by Predictive Biotech, Inc. In connection with ~~Schmid’s~~Schmid's employment with Predictive Biotech, Surgenex has filed a lawsuit alleging unjust enrichment, conspiracy, conversion, tortious interference with contractual and business relations, violations of trade secrets act, and other claims. Based on the information available to us, we do not believe the Surgenex proceedings will have a material adverse effect on our business, results of operations, financial position, or liquidity. Further, we deny the allegations in the complaint, have not discovered any evidence of wrongdoing with respect to the allegations and will vigorously defend against these allegations.

On or about July 12, 2019, Predictive Technology Group, Inc. and Predictive Therapeutics, LLC, a subsidiary of Predictive Technology Group, Inc. filed a lawsuit against Michael ~~Schramm.~~ Schramm ~~had previously acted as our patent agent. While acting as our patent agent,~~(Schramm). Schramm entered into an agreement to sell us certain patents and patent applications in consideration for equity securities. Schramm represented that he owned all ~~right,~~rights, title, and interest in and to the intellectual property. We were subsequently advised by ~~the~~our patent counsel ~~who replaced Schramm~~ that, ~~Schramm’s representation was false.~~while the patents are registered with the US Patent and Trademark Office in the Company's name, the Company may not have a full interest in the patents. An unrelated third-party law firm placed a lien on the patents due to non-payment of legal fees by a third-party entity to whom certain assets were sold by another third-party entity that originally owned the patents. The Company raised these concerns with Schramm, who did not provide satisfactory evidence ~~addressing~~confirming that the ~~concerns of our current patent counsel.~~Company had sole title to the patents. We sued Schramm for breach of contract, conversion and on other legal theories and are seeking, among other things, rescission of the purchase and sale transaction. While there is some question as to whether the Company has full title to these patents, we believe that we have at least partial ownership and can develop products based on the said patents. Schramm filed a counterclaim against us and Bradley C. Robinson, our Chief Executive Officer and Transfer Online, Inc., our transfer agent. Schramm is alleging he did not make any false representations. He is alleging, among other things, that various parties involved in the transaction committed breach of contract, conversion, violations of Nevada state law for failure to transfer securities, breach of fiduciary duty, tortious interference, and civil conspiracy. Based on the information available to us, we do not believe the Schramm proceedings will have a material adverse effect on our business, results of operations, financial position, or liquidity. Further, we deny the allegations in the counterclaim, have not discovered any evidence of wrongdoing with respect to the allegations in the counterclaim and will vigorously prosecute our claims against Schramm.

On or about March 18, 2020, Predictive Biotech, Inc. filed a lawsuit in the Utah District Court against Auxocell Laboratories, Inc. for breach of contract, product liability, breach of warranty, negligent misrepresentation and other claims relating to defects in laboratory equipment Auxocell sold to Predictive Biotech. Alleged damages include wasted umbilical cord tissue, lost inventory, costs associated with particulate testing, reputational injury, and related claims. There can be no assurance that we will be successful in pursuing these claims.

Mackey Investment, LLLP ("Mackey") subscribed for and purchased 500,000 shares of Predictive common stock for $480,000 on or about January 29, 2020. On or about October 19, 2020, Mackey ~~through counsel, sent~~filed a ~~letter demanding~~lawsuit against Predictive, Brad Robinson, Predictive's chief executive officer, and Simon Brewer, Predictive's chief financial officer, in the Third District Court in the State of Utah seeking rescission of ~~his investment.~~the investment, damages in an unspecified amount and attorney's fees. He is ~~alleging that Predictive failed~~asserting claims for breach of contract, fraudulent inducement, violation of the Utah Uniform Securities Act and Conspiracy. Based on the information available to ~~disclose~~us, we do not believe any of the Mackey proceedings will have a material ~~information in connection with its investment and has threatened a lawsuit for securities fraud. To date, no lawsuit has been filed. We~~adverse effect on our business, results of operations, financial position, or liquidity. Further, we deny the allegations in the ~~demand letter~~complaint and have not discovered any evidence of wrongdoing with respect to the allegations and will vigorously defend against these allegations.

On or about April 30, 2020, Equitas Bio/Pharma Solutions, LLC ~~(“Equitas”~~("Equitas") filed a lawsuit against Predictive Technology Group in New York District Court alleging nonpayment of ~~“at~~"at least ~~$551,080”~~$551,080" in amounts owing under Master Service Agreement and Project Work Orders as of the date of filing. The claims are for breach of contract, breach of covenant of good faith and fair dealing and fraud. The basis of the fraud claim alleges that Predictive ~~“made~~"made specific statements to Equitas that it was able to and intend to perform its obligations under the ~~agreements”~~agreements" and at ~~“the~~"the time Predictive made these promises it had no intention of keeping them.”" We agree that amounts are owed under the agreements, but we deny all allegations in the complaint relating to breach of covenant of good faith and fraud. Amounts due as of ~~March 31,~~September 30, 2020 are included in accounts payable in the condensed consolidated balance sheets.

In June 2020, Wellgistics, LLC, the distributor of the Company's Assurance AB product, requested that the partial deposit paid on their non-cancellable purchase order of $5 million (see Note 5) be returned. As the purchase order is contractually non-cancellable and the Company performed on the order in good faith by transmitting the deposit to the Company's supplier, the request to return the deposit was not honored. To date there has been no legal action taken by either party.

As of ~~March 31,~~September 30, 2020, we did not record a liability related to these matters (other than amounts recorded in accounts payable as described above) as it was determined that an unfavorable resolution is either not currently probable or that an amount or relevant range is not reasonably estimable, or both. However, litigation is inherently unpredictable and it is possible that losses may occur. Any unfavorable resolution of any of these matters could materially affect our condensed consolidated financial position, cash flows, or results of operations. All legal costs associated with litigation are expensed as incurred.

On March 11, 2020, the World Health Organization declared the novel coronavirus ("COVID-19"), a respiratory illness first identified in Wuhan, China, a pandemic. The global spread of COVID-19 has created significant volatility, uncertainty, and economic disruption. Governments in affected regions have implemented, and may continue to implement, safety precautions which include quarantines, travel restrictions, business closures, cancellations of public gatherings and other measures as they deem necessary. Many organizations and individuals, including the Company and its employees, are taking additional steps to avoid or reduce infection, including limiting travel and working from home. These measures are disrupting normal business operations both in and outside of affected areas and have had significant negative impacts on businesses and financial markets worldwide.

The severity of the material impact of the COVID-19 pandemic on the Company's business will depend on a number of factors, including, but not limited to, the duration and severity of the pandemic and the extent and severity of the impact on the Company's customers and suppliers, all of which are uncertain and cannot be predicted. The impact of COVID-19 on the Company's results of operations and cash flows has been material and is expected to continue to be material, at least in the short term. Given the dynamic nature of this situation, the Company is currently unable to accurately predict the impact of COVID-19 on its future operations and financial results or cash flows for the foreseeable future and whether the impact of COVID-19 could lead to potential impairments.

We received a Warning Letter from the FDA on August 17, 2020 regarding the marketing of our allograft product, CoreCyte. The letter alleges inappropriate marketing of CoreCyte as a treatment for COVID-19 and challenges the eligibility of CoreCyte for regulation under section 361 of the Public Health Service Act. Products regulated solely under section 361 of the Public Health Service Act do not require premarket approval. As discussed in Note 12, the Company voluntarily stopped selling CoreCyte. The Company is currently working with the FDA to address the concerns raised in the Warning Letter to the FDA's satisfaction. The Company believes that it has complied with all applicable regulations to date.

As of September 30, 2020, many of the Company's obligations were significantly past due. As a result, our creditors may have grounds to take adverse action against the Company, including but not limited to lawsuits and seizure of collateral. Any such actions taken by our creditors could have material adverse impact on our operations or financial condition.

~~Management has evaluated subsequent events through May 15, 2020, the date on which the financial statements were available to be issued.~~

~~On April 1,~~In late October 2020, the Company ~~executed~~accelerated its existing plan to file an ~~agreement captioned Exclusive Distribution Services Agreement (“Agreement”)~~Investigational New Drug application (IND) for CoreCyte. In connection with ~~Wellgistics, LLC (“Wellgistics”) to distribute~~ the Assurance AB™ antibody-based COVID-19 diagnostic test to be imported by the Company. The Company received an initial purchase order under the Agreement for one million Assurance AB test units on April 1, 2020. Wellgistics tendered topending IND filing, the Company voluntarily stopped selling CoreCyte pending a ~~partial payment~~Pre-IND meeting with the FDA. The cessation of ~~$5.5 million. If the remaining contract balance is not paid by Wellgistics, the Company does not~~CoreCyte sales could have ~~the funding to purchase the units described in the agreement. Should final payment be received, shipment~~a material adverse effect on our business or financial condition. CoreCyte represented 73.9% of the ~~initial one million units may be delayed as pertinent regulations in both China and~~Company's sales for the ~~United States continue to evolve.~~three months ended September 30, 2020.

On April 21, 2020 the SEC issued Release No. 34-88719, which temporarily suspended trading in the Company’s common stock due to questions about the accuracy and adequacy of the Company’s previous disclosures regarding its Assurance AB™ serological COVID-19 tests. Trading in the Company’s common stock resumed on May 6, 2020 upon expiration of the suspension. Under OTC Market rules, lack of trading during the suspension resulted in trading of the Company’s common stock being transferred from the OTC Pink Sheets to the OTC Gray Sheets.-22-

On May 6, 2020, Company received loan proceeds of $1.7 million under the Paycheck Protection Program (“PPP”) under a promissory note from a commercial bank (the “PPP Loan”). The PPP, established as part of the CARES Act, provides for loans to qualifying businesses for amounts up to 2.5 times the average monthly payroll expenses of the qualifying business. The loans and accrued interest are forgivable after eight weeks as long as the borrower uses the loan proceeds for eligible purposes, including payroll, benefits, rent and utilities, and maintains its payroll levels.

The application for these funds requires the Company to, in good faith, certify that the current economic uncertainty made the loan request necessary to support the ongoing operations of the Company. Some of the uncertainties related to the Company’s operations that are directly related to COVID-19 include, but are not limited to, the severity of the virus, the duration of the outbreak, governmental, business or other actions (which could include limitations on operations or mandates to provide products or services), impacts on the supply chain, and the effect on customer demand or changes to operations. In addition, the health of the Company’s workforce and its ability to meet staffing needs are uncertain and is vital to its operations.

The PPP Loan certification further requires the Company to take into account our current business activity and our ability to access other sources of liquidity sufficient to support ongoing operations in a manner that is not significantly detrimental to the business. While the Company does have availability under its Revolving Loan Agreement, the $2.8 million that is available, is in place to support working capital needs, along with current cash on hand. Further, the Company has a lack of history of being able to access the capital markets. As a result, the Company believes it meets the certification requirements.

The receipt of these funds, and the forgiveness of the loan attendant to these funds, is dependent on the Company having initially qualified for the loan and qualifying for the forgiveness of such loan based on our future adherence to the forgiveness criteria. The term of the Company’s PPP Loan is two years. The annual interest rate on the PPP Loan is 1% and no payments of principal or interest are due during the six-month period beginning on the date of the PPP Loan. The PPP Loan is subject to any new guidance and new requirements released by the Department of the Treasury who has recently indicated that all companies that have received funds in excess of $2.0 million will be subject to a government (Small Business Administration) audit to further ensure PPP loans are limited to eligible borrowers in need.

Item 2. ~~MANAGEMENT’S~~MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with the audited ~~Consolidated~~Condensed consolidated Financial Statements and accompanying notes thereto included in the ~~Company’s~~Company's Annual Report on Form 10-K as of and for the fiscal year ended June 30, ~~2019.~~2020. Unless otherwise noted, all of the financial information in this Report is condensed consolidated financial information for the Company.

Predictive Technology Group, Inc., a Salt Lake City, UT life sciences company, is a leader in the use of data analytics for disease identification and subsequent therapeutic intervention through unique novel gene-based diagnostics, biotechnology treatments and companion therapeutics. Through ~~its’~~its' wholly-owned subsidiaries, Predictive Biotech, Predictive Laboratories, and Predictive Therapeutics, the company focuses on clinical categories such as: Endometriosis, Degenerative Disc Disease and Human Cell and Tissue Products (“("HCT/P”P"). In addition to Predictive ~~Biotech’s~~Biotech's efforts to advance regenerative medicine, Predictive Laboratories is committed to assisting women in overcoming the devastating consequences of endometriosis via appropriate early-stage diagnosis and subsequent treatment. During the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 we reported total revenues of ~~$5,723,984~~$5,091,004 and ~~$21,319,882, respectively. We reported~~ net ~~losses~~loss attributable to common ~~shareholders~~stockholders of ~~$13,700,980 and $47,568,256,~~$15,460,064 resulting in ~~net losses~~a $0.05 loss per ~~common share of $(0.05) and $(0.16), respectively.~~share. During the three ~~and nine~~ months ended ~~March 31,~~September 30, 2019 we reported total revenues of ~~$11,295,618~~$8,259,257 and ~~$30,046,456, respectively. We reported~~ net ~~losses attributable to common shareholders~~loss of ~~$3,708,911 and $8,042,731~~$7,864,607 resulting in ~~net losses~~a $0.03 loss per ~~common share of $(0.01) and $(0.03), respectively.~~share.

Our business units have been aligned with how the Chief Operating Decision Maker reviews performance and makes decisions in managing the Company. The business units have been aggregated into two reportable segments: Human Cell and Tissues Products (HCT/Ps) and diagnostics and therapeutics. Predictive ~~Biotech’s~~Biotech's HCT/Ps are processed in our FDA registered lab. Our minimally manipulated tissue products are prepared utilizing proprietary extraction methods that reduce the loss of important scaffolding, growth factor and general cytokines and are intended for homologous use. ~~Predictive Laboratory’s~~The diagnostics and therapeutics segment uses data analytics for disease identification and subsequent therapeutic intervention through unique novel gene-based diagnostics, biotechnology treatments and companion therapeutics.

The global COVID-19 pandemic has had, and will continue to have, a material impact on our business. Towards the end of the third quarter of fiscal 2020 we began to experience, and through the date of this filing we are continuing to experience, impacts to our business and operations related to the COVID-19 pandemic, including the impact of stay-at-home mandates and related safety measures such as the delay of elective medical procedures, resulting in a decline in the volume of procedures using our products and a resulting decline in sales. We cannot predict the magnitude or duration of the pandemic’s impact on our business.Business Updates

~~As a result of the COVID-19 pandemic, we undertook a thorough analysis of all of our expenses and reduced discretionary expenses where practicable.~~

In April 2020, we reduced headcount in our HCT/P segment by approximately 50%. We can give no assurances that we will not have to take additional cost reduction measures if the pandemic continues to adversely affect the volume of procedures using our products.

On February 25, 2020, we announced preliminary results from a collaborative genomics analysis from our collaboration partner, Atrin Pharmaceuticals, that will be used to optimize patient selection for Atrin’s upcoming ATRN-119 clinical trial. This genomics analysis was a result of Atrin’s collaboration with us to utilize next-generation genomics capabilities to improve predictive selection of clinical study patients most likely to respond and least likely to experience side effects from treatment with Atrin’s DDR drug candidates. We and Atrin have been jointly developing proprietary approaches to better identify patients with specific mutations that drive cancer tumor growth, regardless of tumor type, and who are most likely to clinically respond to synthetically-lethal anti-cancer therapies. Our genomics capabilities were added to Atrin’s existing proprietary proteomic and medicinal chemistry technologies to improve targeting of DDR proteins that are active in cancer cells and relatively inactive in healthy cells, ahead of Atrin’s initiation of a Phase 1/2a clinical study of ATRN-119, Atrin’s lead oral drug candidate. We are using a genomic data base analytics approach to help with patient selection, to increase efficiencies and quality of clinical trials, and to shorten time to market for Atrin’s drug candidates. Atrin’s pipeline also includes preclinical drug candidates in development for glioblastoma and hematological disorders that are being advanced towards IND enabling studies. This genomics analysis is already resulting in improved targeting of eligible patients for the upcoming Phase 1/2a ATRN-119 clinical study, and could potentially result in adoption of a new diagnostic for this type of anti-cancer treatment. Our unique genomic insights and modeling provide Atrin with enhanced diagnostic tools to accelerate Atrin’s DDR therapies and studies. Atrin currently expects initiation of the ATRN-119 Phase 1/2a study in 2020, with a first interim clinical readout in 2021. We believe that the Atrin collaboration will result in improved design and faster clinical advancement of multiple individualized, precision oncology treatments. By combining our state-of-the-art proprietary screening assay and related artificial intelligence capabilities with Atrin’s breakthrough DDR therapy candidates, we have the potential to become a leader in development of improved personalized oncology therapies. Cancer is genomic disease; cancer tumors typically develop when otherwise healthy cells acquire mutations in key “driver genes.” These cancer-causing mutations alter pathways regulating cellular growth and interactions with surrounding tissues. Understanding the specific gene mutations underlying tumor formation is frequently more important than location of the cancer in selecting personalized anti-cancer therapies. The key to successful cancer therapy is matching specific cancer mutations with efficient and targeted therapies. Multiple benign diseases, cancer-predisposition syndromes, and cancers have now been linked to mutations in DDR genes. DDR is a clinically validated therapeutic approach, following the commercial approval of multiple blockbuster Poly ADP Ribose Polymerase (PARP) inhibitor products. DDR drugs already represent a multi-billion-dollar market, and it is expected that DDR drugs may ultimately be used to treat over 200 different cancer targets, if a full set of complementary patient-targeting biomarkers are successfully developed and adopted for commercial use. Preliminary results from the collaborative genomics analysis using our proprietary assays in patients with a specific tumor type found an excess of DDR mutations in cancer cells compared with normal tissue. The analysis identified 92 genes as protein responders to ATRN-119 treatment, of which 18 genes are known TIER 1 cancer-driver genes, and well-characterized mutations were found in three dominant genes. Both in vitro and animal studies have confirmed synthetically-lethal interactions between ATRN-119 treatment and alteration of these three key cancer-causing genes. The overlap between DDR genes responding to ATRN-119 and those mutated in cancer cells suggest that genetic markers underlying response and resistance will be critical to optimizing patient selection in ATRN-119 clinical studies, by increasing clinical efficacy and minimizing systemic toxicities. Under the terms of the original Atrin-Predictive collaboration agreement, both companies will continue to contribute to the identification of additional druggable targets and pathways, both inside and outside of DDR, to treat a broad group of target indications, particularly in women’s health.

On January 28, 2020, we announced apotentialcollaboration agreement with Atrin Pharmaceuticals LLC to develop molecular diagnostic tools to facilitate improved selection of cancer patients who would most benefit from treatment with DNA Damage and Response (DDR) inhibitors, including Atrin’s and other small molecule ATR inhibitors. Atrin and Predictive will jointly utilize Predictive Laboratories’ state-of-the-art sequencing capabilities and genomics expertise to identify cancer patients with specific molecular markers that predict the level of clinical response to Atrin’s, and other, targeted therapies. This is intended to improve patient outcomes as well as improve Atrin’s ability to successfully progress its product pipeline, and upon commercialization, improve on the treatments for women with cancer. Predictive, with its proprietary list of already identified genes and state-of-the-art sequencing capabilities, believes it is the ideal molecular diagnostic partner to help Atrin successfully advance their therapeutic pipeline through clinical development. The companies believe that this collaboration may become a ‘game changer’ in oncology, as treatment continues to progress towards individualized precision medicine. As Atrin advances multiple Investigational New Drug (IND) applications and progresses their lead product candidate ATRN-119 into a first-in-human clinical study this year, Predictive’s portfolio of genomic tests will help Atrin better identify cancer patient populations whose genetic profiles will likely have an optimal clinical response to Atrin’s proprietary anti-cancer therapeutics. The collaboration will help optimize the safety and clinical efficacy of Atrin’s targeted cancer therapeutics and other DDR drug candidates. Atrin will have access to Predictive’s proprietary GenDB databases and women’s health biobank to better understand the clinical spectrum of germline mutations in DDR pathways. The companies will also study common gynecologic disorders, such as endometriosis, associated with the development of cancers in affected patients. The goal of this collaboration is to develop actionable predictive molecular and companion diagnostics and therapeutics for these common disorders and related cancers.

~~On October 16, 2019, Kenneth Ward, M.D., Chief executive officer of Juneau Biosciences~~; Rakesh Chettier M.S., director of biostatistics of Predictive Laboratories; and Hans Albertsen, Ph.D., chief scientific officer of Juneau Biosciences, received the 2019 Endometriosis Special Interest Group (EndoSIG) Prize Paper in the “Best in Clinical/Population Science” category at the American Society for Reproductive Medicine (ASRM) 2019 Scientific Congress & Expo in Philadelphia. The scientific breakthroughs reported in these award-winning discoveries provide us with insights into new non-hormonal therapies. The team’s research is based on the genetic markers of endometriosis discovered by Juneau and Predictive scientists in recent years, and uncovers molecular pathways involved in the pathogenesis of endometriosis-induced lesions in women at risk for the disease. Dr. Ward, a board-certified physician in obstetrics and gynecology, perinatology, clinical genetics and molecular genetics, presented two scientific papers at the Annual ASRM meeting: a poster entitled, “~~Endometriosis risk allele in WNT4 may interact with rare mutations in HDAC2 gene~~~~” and an oral abstract entitled, “~~~~Somatic cancer driver mutations in endometriosis lesions contribute to secondary cancer risk~~.”

On October 14, 2019, we launched the full U.S. market availability of ARTguide™ to evaluate the risk for endometriosis and other genetic causes of infertility in women. Endometriosis can be a debilitating disease for many women as it can cause severe pelvic pain, inflammation, adhesions to the fallopian tubes and uterus, and often, infertility. ARTguide can predict a patient’s risk of endometriosis early on so that women have a better understanding of their barriers to conception, and therefore their physician can create a more personalized infertility treatment plan. ARTguide is appropriate for all women considering use of ART to overcome difficulty conceiving or carrying a pregnancy.

In October 2019, we launched FertilityDX™, a comprehensive genetic testing service that identifies barriers to healthy pregnancy and birth, allowing doctors to tailor fertility treatments. The objective of FertilityDX™ is to provide couples considering ART with an understanding of the genetic and medical obstacles that may be affecting their fertility and provide doctors with genetically relevant information to help their patients have a healthy baby. FertilityDX™ provides information by evaluating three key areas: contributors to (or causes of) infertility, risks of pregnancy complications, and risks for serious genetic conditions in offspring. The test will be launched in select fertility clinics across the United States.

In August 2019, we collected over 2,500 DNA samples along with comprehensive medical records since acquiring our CLIA operations in March 2019. We broadened our research initiatives by acquiring new sample collections in chronic pain, pregnancy complications, autism, and both female and male infertility. Personalized medicine and the development of new therapeutics are expected to play a critical role in human health. Access to high-quality biospecimens from our biobank will be important for furthering our biomedical and translational research, and ultimately its development of personalized molecular diagnostics and clinical therapies. Current sample collection efforts are designed to strategically augment our existing library of over 300,000 DNA samples that we believe will produce valuable insights into future research and development projects.

On August 9, 2019, we launched PGxPLUS+™, a pharmacogenomic test panel being marketed to pain clinics for patients with chronic pain. PGxPLUS+™ evaluates genetic factors that play a major role in an individual’s response to medications. In parallel, we reached a milestone of enrolling 350 patients with chronic pain into an Investigational Review Board-approved clinical study aimed at providing additional insight into the mechanisms of chronic pain and responses to pain therapies. We are approaching chronic pain and the opioid crisis on multiple fronts. We have developed and in-licensed important prognostic DNA tests and novel treatments for osteoarthritis, lumbar disc disease, endometriosis, and other conditions causing chronic pain. In 2016, the Institute of Medicine estimated that up to one-third of the U.S. population lives with ongoing pain. Chronic pain is often triggered by one of these common conditions, and over time can develop into a chronic pain syndrome, which is a disease itself. The PGxPLUS+™ test evaluates 112 genetic variants across 38 genes that affect the metabolism of over 150 common medications, including pain medications. More than 90% of the population has one or more gene variants that affect the efficacy or safety of prescription drugs. Variation in drug metabolism is largely determined by an individual’s genetic profile, blood levels of a drug may vary up to 1,000-fold in similar patients taking identical doses of the same drug. Pharmacogenomics is the study of the role of our genome in drug responses.

On July 29, 2019, we entered into an agreement with the Preeclampsia Foundation to expand the study of genetic factors associated with preeclampsia. The study will advance the Preeclampsia Foundation’s database of collected preeclampsia medical information and will be utilized by Predictive Laboratories to develop a proprietary test for the early detection of women at risk for preeclampsia. Preeclampsia affects 5-8%, or approximately 300,000, pregnancies every year in the United States, sometimes causing severe adverse maternal and fetal outcomes, including organ failure, massive blood loss, permanent disability or even death. Globally, preeclampsia is a leading cause of pregnancy complications, preterm births and related disabilities. The deaths of approximately 76,000 mothers and 500,000 babies annually are attributable to preeclampsia. Healthcare providers, even in medically advanced countries, are hampered by imprecise diagnostic tools. The Preeclampsia Registry, a key program of the Preeclampsia Foundation’s research mission, is a patient registry that collects paired medical information and biological samples. Using established Institutional Review Board-approved protocols, we and the Preeclampsia Foundation will request samples from more than 2,500 existing and new registry participants for sequencing analysis. We have been granted a period of exclusive access to research data resulting from these new samples enrolled in the Preeclampsia Registry, after which samples and sequencing data will be available to other investigators for future research. This collaboration complements and extends our ongoing preeclampsia research initiatives. Over 20,000 DNA samples from our biorepository relating to preeclampsia and associated obstetric syndromes are being analyzed.

~~On April 9, 2020, we announced the submission of~~submitted an ~~Emergency Use Authorization (EUA)~~ application ~~with~~to the U.S. Food and Drug Administration (FDA) for Emergency Use Authorization (EUA) to market the ~~immediate use~~Assurance AB lateral flow assay. Predictive Laboratories' application was submitted before the FDA had determined how COVID serology tests would be evaluated. In subsequent discussions with the FDA, it became apparent that a different test design for Assurance AB would be preferred due the rapidly changing understanding of ~~mesenchymal stem cells (MSCs) derived~~the science related to COVID antibodies and the clinical utility of antibody testing. In parallel, over recent months, the rapid antibody testing market has shifted away from ~~umbilical cord tissue~~testing for recent infection (high titer levels of short-term IgM antibodies) toward preparing for near-term COVID immunity and vaccine related priorities (presence of IgG antibodies). As a result, Predictive made a business decision to withdraw the pending EUA application for the ~~treatment of Acute Respiratory Distress Syndrome (ARDS), secondary to SARS-CoV-2, coronavirus disease 2019 (COVID-19)~~original Assurance AB test design. Instead, The Company is working on an advanced test design with our manufacturing partner (DaBlood). ~~The pandemic caused by COVID-19 has shown to develop into severe ARDS in 30% of hospitalized patients with~~It is likely that a ~~22%-62% mortality rate (Murthy et al., 2020) for those requiring hospitalization in an intensive care unit. Currently, there is no confirmed treatment that can demonstrate safety or efficacy~~new EUA application for the ~~treatment of COVID-19. Coronavirus can~~revised COVID lateral flow assay will be deadly, in large part because the virus can cause ‘cytokine storms’ in which the patient’s own immune system triggers a runaway response causing more damage to the patient, than to the virus it’s trying to eliminate. Clinical data from early clinical trials appears to indicate that the avoidance of the cytokine storm utilizing MSCs may be a critical component for the treatment of COVID-19 infected patients. A recent review article published in Pain Physician, concluded that, “The limited but emerging evidence regarding UC MSC [umbilical cord mesenchymal stem cells] in managing COVID-19 suggests that it might be considered for compassionate use in critically ill patients to reduce morbidity and mortalitysubmitted in the United States.” The proposed IND clinical trial will utilize Predictive’s proprietary core technology of naturally occurring MSCs derived from umbilical cord tissue (UC-MSCs) to assess the efficacy as an add-on therapy to standard treatment of patients with severe Acute Respiratory Distress Syndrome (ARDS) secondary to COVID-19. Predictive’s UC MSC product, CoreCyteTM, [currently regulated by the FDA as a tissue-based product under 21 CFR 1271.3(d)(1) and Section 361 of the Public Health Service Act] has already been used as an allograft in over 50,000 patients. Physicians have reported to Predictive that over 1,100 patients have been treated with CoreCyte via intravenous administration. No serious adverse events have been reported with CoreCyte regardless of the route of administration. If Predictive’s EUA request is approved, CoreCyte would be available immediately to critically ill patients with ARDS due to COVID-19 infections.second fiscal quarter.

In November 2019, Predictive Biotech’s HCT/P processing facility successfully achieved the internationally recognized ISO 13485 certification over the Company’s system of laboratory quality controls.

Results of Operations for the ~~Three Months~~three months Ended ~~March 31,~~September 30, 2020 and 2019

~~The decrease~~Revenue in ~~revenue~~the HCT/P segment for the three months ended ~~March 31,~~September 30, 2020 decreased by $4.4 million from $8.3 million for the three months ended September 30, 2019. The decrease is primarily due to the ~~decline in~~impact of the COVID-19 pandemic, which has caused continued sales ~~volume~~declines due to closure of customer clinics and reduced patient visits to those clinics that remain open.

In October 2020, the Company notified the FDA that it had suspended sales of the CoreCyte allograft ~~products compared to~~product pending the anticipated filing of an IND application with the FDA. CoreCyte represented 73.9% of the Company's sales for the three months ended ~~March 31, 2019. The~~September 30, 2020. While commercial success cannot be guaranteed, the Company ~~believes~~is executing its transition plan related to the ~~decrease~~CoreCyte IND application and expects to generate additional sales from new and existing products in ~~sales volume is due to increased United States Food and Drug Administration (“FDA”) enforcement efforts affecting~~ the regenerative medicine industry as a whole, which has negatively impacted the size of the market for regenerative medicine services and caused a contraction of sales of allograft products. Specifically, the FDA has issued warnings to competitors regarding their safety practices and increased regulatory scrutiny of potentially inappropriate marketing practices of some providers of regenerative medicine services. Predictive Biotech, Inc. continues to demonstrate an excellent safety and quality record of over 100,000 allografts implanted and no adverse events. In addition, sales during the second half of March were negatively impacted by social distancing measures in response to COVID-19.near term.

~~Revenues~~Revenue in ~~our~~the diagnostics and therapeutics segment ~~were not material~~ for the ~~periods shown.~~three months ended September 30, 2020 increased by $1.2 million from zero due to the introduction of the Assurance VR COVID-19 RT-PCR viral test during the three months ended September 30, 2020.


	Three months ended
	March 31,								Three months ended
	2020			2019			Change		September 30,
Cost of goods sold	$	4,237,824		$	4,773,332		$	(535,508)	2020			2019			Change
HCT/P									$	2,386,660		$	7,181,991		$	(4,795,331)
Diagnostics and Therapeutics										1,078,477			-			1,078,477
Total									$	3,465,137		$	7,181,991		$	(3,716,854)

Cost of goods sold as a % of sales		74.0	%		42.3	%
HCT/P										61.7	%		87.0	%
Diagnostics and Therapeutics										88.3	%		-	%

Cost of goods sold in the HCT/P segment for the three months ended ~~March 31,~~September 30, 2020 decreased to ~~$4.2~~$2.4 million from ~~$4.8~~$7.2 million for the three months ended ~~March 31,~~September 30, 2019. ~~The~~Approximately $1.2 million of decrease is due to decreased sales. The remaining decreases are primarily comprised of $2.3 million in scrap expense, $0.5 million in personnel costs, and $0.3 million in freight and transaction costs. Scrap expense for the three months ended September 30, 2019 was abnormally high, primarily due to defective components supplied by a ~~$2.0 million reduction~~specific vendor (see Note 11 to the accompanying condensed consolidated financial statements for a summary of legal action taken against the vendor). The remaining decreases resulted from decreased sales and decreases in ~~direct cost of sales related~~production capacity made in response to the decrease in ~~revenues, offset by a $1.1 million increase in scrap expense related to HCT/P product that did not pass quality control, or that is not expected to pass quality control.~~sales.

Cost of ~~sales~~goods sold in ~~our~~the diagnostics and therapeutics segment ~~was not material~~ for the ~~periods shown.~~three months ended September 30, 2020 increased to $1.1 million from zero due to the introduction of the Assurance VR COVID-19 RT-PCR viral test during the three months ended September 30, 2020. The profitability of the COVID-19 testing business is sensitive to testing volume, with higher marginal profitability per unit after fixed costs are covered.


	Three months ended								Three months ended
	March 31,								September 30,
	2020			2019			Change		2020			2019			Change
Selling and marketing expense	$	2,002,394		$	2,888,309		$	(885,915)	$	1,061,798		$	3,151,971		$	(2,090,173)
Selling and marketing expense as a % of sales		35.0	%		25.6	%				20.9	%		38.2	%

Selling and marketing expenses for the three months ended ~~March 31,~~September 30, 2020 decreased to ~~$2.0~~$1.1 million from ~~$2.9~~$3.2 million for the three months ended ~~March 31,~~September 30, 2019. The decrease is due to ~~a decrease in commissions expense of $1.3 million, offset by increases~~decreases in personnel costs of ~~$0.5~~$0.8 million, share-based compensation expense of $0.3 million, and commissions expense of $0.7 million.

Substantially all of our selling and marketing expenses were incurred in the HCT/P segment.


	Three months ended								Three months ended
	March 31,								September 30,
	2020			2019			Change		2020			2019			Change
General and administrative expense	$	6,343,658		$	4,835,652		$	1,508,006	$	5,257,499		$	6,378,877		$	(1,121,378)
General and administrative expense as a % of sales		110.8	%		42.8	%				103.3	%		77.2	%

General and administrative expenses for the three months ended ~~March 31,~~September 30, 2020 ~~increased~~decreased to ~~$6.3~~$5.0 million from ~~$4.8~~$6.4 million for the three months ended ~~March 31,~~September 30, 2019. The ~~increase~~decrease is due to ~~increased~~decreases in personnel costs of $0.6 million and share-based compensation ~~expenses of $0.5 million, increased insurance costs of $0.2 million, increased professional fees of $0.3 million, increased payroll costs of $0.2 million, and increased information technology~~ expense of ~~$0.2~~$0.6 million. The decreases in personnel costs resulted primarily from the April 2020 reduction in force.


	Three months ended								Three months ended
	March 31,								September 30,
	2020			2019			Change		2020			2019			Change
Research and development expense	$	2,125,421		$	1,458,265		$	667,156	$	370,842		$	1,828,350		(1,457,508)
Research and development expense as a % of sales		37.1	%		12.9	%				7.3	%		22.1	%

Research and development expenses for the three months ended ~~March 31,~~September 30, 2020 ~~increased~~decreased to ~~$2.1~~$0.4 million from ~~$1.5~~$1.8 million for the three months ended ~~March 31,~~September 30, 2019. Approximately $0.9 million of the decrease is due to decreased share-based compensation expense, with the remainder driven by reallocation of resources previously used in R&D ~~expenses primarily related~~ to perform the ~~development of new HCT/P products and continued development of molecular diagnostic tests.~~Assurance VR COVID-19 test.


	Three months ended								Three months ended
	March 31,								September 30,
	2020			2019			Change		2020			2019			Change
Depreciation and amortization expense	$	2,738,165		$	2,374,006		$	364,159	$	2,484,083		$	2,610,245		$	(126,162)
Depreciation and amortization expense as a % of sales		47.8	%		21.0	%				48.8	%		31.6	%

Depreciation and amortization expense ~~increased~~decreased compared to the same period in the prior fiscal year primarily due to ~~an increase~~a decrease in our intangible asset portfolio arising from the ~~business combinations and asset acquisitions~~impairment of RMT described in Note 23 to the accompanying condensed consolidated financial statements. ~~Capital expenditures~~

Loss on impairment for the three months ended September 30, 2020 increased to ~~acquire property, plant, and equipment in connection with our laboratory expansion also contributed~~$7.0 million due to the ~~increase.~~impairment of $5.2 million in goodwill and 1.8 million in trade secrets in the HCT/P segment (see Note 3 to the accompanying condensed consolidated financial statements).

Other loss for the three months ended ~~March 31,~~September 30, 2020 increased ~~by $0.8~~to $0.9 million ~~compared to~~from $0.2 million for the three months ended ~~March 31,~~September 30, 2019. The increase was primarily driven by ~~$0.6 million in~~ increased ~~losses related to~~loss on our equity method investment ~~in Juneau Biosciences, LLC. In addition, a bargain purchase gain arising from the acquisition~~ of ~~Taueret Laboratories, LLC of $0.3 million recognized during the three months ended March 31, 2019 did not recur.~~

The decrease in revenue for the nine months ended March 31, 2020 is primarily due to the decline in sales volume of allograft products compared to the nine months ended March 31, 2019. The Company believes the decrease in sales volume is due to increased United States Food and Drug Administration (“FDA”) enforcement efforts affecting the regenerative medicine industry as a whole, which has negatively impacted the size of the market for regenerative medicine services and caused a contraction of sales of allograft products. Specifically, the FDA has issued warnings to competitors regarding their safety practices and increased regulatory scrutiny of potentially inappropriate marketing practices of some providers of regenerative medicine services. Predictive Biotech, Inc. continues to demonstrate an excellent safety and quality record of over 100,000 allografts implanted and no adverse events. In addition, sales during the second half of March were negatively impacted by social distancing measures in response to COVID-19.

~~Revenues in our diagnostics and therapeutics segment were not material for the periods shown.~~

Cost of goods sold for the nine months ended March 31, 2020 increased to $17.3 million from $10.9 million for the nine months ended March 31, 2019. The increase is primarily due to $4.9 million in scrap expense related to HCT/P product that did not pass quality control, or that is not expected to pass quality control. The increase in quality control failure rates above normal levels was primarily due to issues with a component supplied by a specific vendor. In addition, share based compensation expense increased by $0.6 million ~~indirect personnel costs increased by $0.4 million,~~ and ~~liquid nitrogen costs increased by $0.4 million in connection with the expansion of our production capacity since March 2019.~~

~~Cost of sales in our diagnostics and therapeutics segment was not material for the periods shown.~~

Selling and marketing expenses for the nine months ended March 31, 2020 decreased to $8.2 million from $8.7 million for the nine months ended March 31, 2019. The decrease is due to a decrease in commissions expense of $2.6 million, offset by increases in personnel costs of $1.9 million.

~~Substantially all of our selling and marketing expenses were incurred in the HCT/P segment.~~

General and administrative expenses for the nine months ended March 31, 2020 increased to $19.8 million from $10.4 million for the nine months ended March 31, 2019. Approximately $5.8 million of the increase is due to increased share-based compensation expenses. Additionally, personnel costs increased by $2.0 million and legal and consulting costs increased by $1.2 million.

Research and development expenses for the nine months ended March 31, 2020 increased to $6.3 million from $3.8 million for the nine months ended March 31, 2019. The increase was primarily driven by an increase of $2.2 million in share based compensation expense.

~~Depreciation and amortization expense increased compared to the same period in the prior fiscal year primarily due to~~ an increase in our intangible asset portfolio arising from the business combinations and asset acquisitions described in Note 2 to the accompanying condensed consolidated financial statements. Capital expenditures to acquire property, plant, and equipment in connection with our laboratory expansion also contributed to the increase. interest expense of $0.1 million.

Other loss for the nine months ended March 31, 2020 increased to $17.5 million from $0.9 million for the nine months ended March 31, 2019. The increase was primarily driven by the $15.9 million impairment charge recognized related to our equity method investment in Juneau Biosciences, LLC.

The Company incurred a net loss attributable to common ~~shareholders~~stockholders of ~~$47,568,256 for the nine months ended March 31, 2020~~$15,460,064 and net cash outflows from operations of ~~$12,066,359.~~$1,867,499 for the three months ended September 30, 2020. At ~~March 31,~~September 30, 2020, the Company had ~~$206,443~~$1,270,841 of cash and negative working capital of ~~$9,651,987.~~$14,842,006. The Company's historical and current use of cash in operations combined with limited liquidity resources raise substantial doubt regarding the ~~Company’s~~Company's ability to continue as a going concern. Management may seek additional capital through debt financings, collaborative or other funding arrangements with partners, sale of assets, or through other sources of financing. Should the Company seek additional financing from outside sources, the Company may not be able to raise such financing on terms acceptable to the Company or at ~~all.~~all to mitigate the substantial doubt that exists. If the Company is unable to raise additional capital when required or on acceptable terms, this could have a material adverse effect on liquidity. In such a case, the Company may be required to scale back or to discontinue the promotion of currently available products, scale back or discontinue the advancement of product candidates, reduce headcount, file for bankruptcy, reorganize, merge with another entity, or cease operations.

Our capital deployment strategy focuses on use of resources in two key areas: research and development, and the commercialization of our HCT/Ps and diagnostic products. We believe that research and development provides the best return on invested capital. We also allocate capital for acquisitions that support our business strategy.


	Nine months ended						Three months ended
	March 31,						September 30,
	2020		2019		Change		2020		2019		Change
Cash provided by (used in) operating activities	$	(12,066,359)	$	3,059,291	$	(15,125,650)
Cash used in operating activities							$	(1,867,499)	$	(6,251,183)	$	4,383,684
Cash used in investing activities		(1,024,136)		(3,467,143)		2,443,007		(125,537)		(600,805)		475,268
Cash provided by financing activities		11,678,694		1,028,133		10,650,561		2,932,649		6,075,587		(3,142,938)
Net increase (decrease) in cash and cash equivalents		(1,411,801)		620,281				939,613		(776,401)
Cash and cash equivalents at the beginning of the nine months		1,618,244		1,206,139
Cash and cash equivalents at the beginning of the period								331,228		1,618,244
Cash and cash equivalents at the end of the period	$	206,443	$	1,826,420			$	1,270,841	$	841,843

The ~~increase~~decrease in cash used in operating activities for the ~~nine~~three months ended ~~March 31,~~September 30, 2020 compared to the ~~nine~~three months ended ~~March 31,~~September 30, 2019 was primarily due to decreases in cash paid to suppliers and employees as a ~~$39.5 million increase~~result of reductions in ~~net loss,~~production and ~~a $5.7 million increase~~production capacity made in deferred income tax benefits, offset by increases of non-cash addbacks for loss on equity method investment of $15.9 million, share based compensation of $9.1 million, depreciation and amortization of $2.0 million, and changes in operating assets and liabilities of $3.3 million. response to decreasing sales.

The decrease in cash used in investing activities for the ~~nine~~three months ended ~~March 31,~~September 30, 2020 compared to the ~~nine~~three months ended ~~March 31,~~September 30, 2019 was primarily due to a decrease in cash paid on our subscription payable of ~~$1.1~~$0.3 million and a decrease in capital expenditures of ~~$2.1~~$0.2 million. ~~These changes were partly offset by $0.9 million in cash received from the acquisitions of InceptionDX, LLC and Taueret Laboratories, LLC.~~

The ~~increase~~decrease in cash provided by financing activities for the ~~nine~~three months ended ~~March 31,~~September 30, 2020 compared to the ~~nine~~three months ended ~~March 31,~~September 30, 2019 was primarily due to the receipt of ~~$11.5~~$3.1 million less in proceeds from the issuance of promissory notes.

We do not believe that inflation has had a material impact on our business, sales, or operating results during the periods presented.

We currently do not have any off-balance sheet arrangements or financing activities with special-purpose entities.

Critical accounting policies are those policies which are both important to the presentation of a ~~company’s~~company's financial condition and results and require ~~management’s~~management's most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain. There have been no recent significant changes to our accounting policies during the ~~nine~~three months ended March 31, 2020, other than the adoption of ASU 2016-02 discussed in detail in Footnote 1 to the accompanying unaudited condensed consolidated financial statements. For a further discussion of our critical accounting policies, see our Annual Report on Form 10-K for the fiscal year ended JuneSeptember 30, ~~2019.~~2020.

The Securities and Exchange Commission encourages companies to disclose forward-looking information so that investors can better understand a ~~company’s~~company's future prospects and make informed investment decisions. This Quarterly Report on Form 10-Q contains such ~~“forward-looking statements”~~"forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995.

All statements in this report, other than statements of historical fact, are forward-looking statements for purposes of these provisions, including any projections of earnings, revenues or other financial items, any statements of the plans and objectives of management for future operations, any statements concerning proposed new products or services, any statements regarding future economic conditions or performance, and any statements of assumptions underlying any of the foregoing. All forward-looking statements included in this report are made as of the date hereof and are based on information available to us as of such date. We assume no obligation to update any forward-looking statement. In some cases, forward-looking statements can be identified by the use of terminology such as ~~“may,” “will,” “expects,” “plans,” “anticipates,” “intends,” “believes,” “estimates,” “potential,”~~"may," "will," "expects," "plans," "anticipates," "intends," "believes," "estimates," "potential," or ~~“continue,”~~"continue," or the negative thereof or other comparable terminology. Although we believe that the expectations reflected in the forward-looking statements contained herein are based upon reasonable assumptions at the time made, there can be no assurance that any such expectations or any forward-looking statement will prove to be correct. Our actual results will vary, and may vary materially, from those projected or assumed in the forward-looking statements. Future financial condition and results of operations, as well as any forward-looking statements, are subject to inherent risks and uncertainties, many of which we cannot predict with accuracy and some of which we might not anticipate, including, without limitation, ~~the impact of the COVID-19 pandemic on our business,~~ product recalls and product liability claims; infringement of our technology or assertion that our technology infringes the rights of other parties; termination of supplier relationships, or failure of suppliers to perform; inability to successfully manage growth; delays in obtaining regulatory approvals or the failure to maintain such approvals; concentration of our revenue among a few customers, products or procedures; development of new products and technology that could render our products obsolete; market acceptance of new products; introduction of products in a timely fashion; price and product competition, availability of labor and materials, cost increases, and fluctuations in and obsolescence of inventory; volatility of the market price of our common stock; foreign currency fluctuations; changes in key personnel; work stoppage or transportation risks; integration of business ~~acquisitions; and other factors referred to in our reports filed with the SEC, including our most recently filed Annual Report on Form 10-K.~~acquisitions. All subsequent forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. ~~Additional factors that may have a direct bearing on our operating results are discussed in Item 1A “Risk Factors” in our most recently filed Annual Report on Form 10-K.~~ In light of these assumptions, risks and uncertainties, the results and events discussed in the forward-looking statements contained in this ~~Quarterly~~Annual Report or in any document incorporated by reference might not occur. Stockholders are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date of this Quarterly Report. We are not under any obligation, and we expressly disclaim any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. All subsequent forward-looking statements attributable to us or to any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section.

We maintain disclosure controls and procedures (Disclosure Controls) within the meaning of Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended, or the Exchange Act. Our Disclosure Controls are designed to ensure that information required to be disclosed by us in the reports we file or submit under the Exchange Act, such as this Quarterly Report on Form 10-Q, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange ~~Commission’s~~Commission's rules and forms. Our Disclosure Controls are also designed to ensure that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our Disclosure Controls, management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily applied its judgment in evaluating and implementing possible controls and procedures.

As of the end of the period covered by this Quarterly Report on Form 10-Q, we evaluated the effectiveness of the design and operation of our Disclosure Controls, which was done under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer. Based on the evaluation of our Disclosure Controls, our Chief Executive Officer and Chief Financial Officer have concluded that, as of ~~March 31,~~September 30, 2020, our Disclosure Controls were not effective due to a material ~~weakness~~weaknesses in the ~~Company’s~~Company's internal control over financial reporting as disclosed below.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) promulgated under the Exchange Act as a process designed by, or under the supervision of, a company's principal executive and principal financial officers and effected by the Company's board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. In making this assessment, management used the criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

Based on our ~~prior~~ assessment, ~~as of June 30, 2019,~~ management has concluded that our internal control over financial reporting was not effective as of September 30, 2020, due to the following material weaknesses:

● The Company has a material weakness ~~related~~in the design and operation of its controls regarding its accounting for its equity method investment, including the proper elimination of intercompany profit included in assets acquired by the Company from its equity method investment and possible impairment of the investment. The identification of intercompany profit to ~~insufficient~~be eliminated and the identification and compilation of data, assumptions, and computations used to determine the estimated fair value is not sufficiently precise in its preparation and review to identify misstatements that could become material.

● Separately, the Company has a material weakness in the design and operation of its controls over the ~~accounting for~~timely recording of forfeitures of share-based compensation awards and the ~~income tax effects~~application of ~~business combinations~~the amortization method used to recognize expense related to share based compensation awards, which could become material.

● The Company has a material weakness in the design and ~~asset acquisitions.~~ operation of its controls related to the timely execution of contracts.

A ~~“material weakness”~~"material weakness" is a deficiency, or a combination of deficiencies, in Internal Control over Financial Reporting ("ICFR"), such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. ~~Such material weakness has~~

Because of its inherent limitations, internal control over financial reporting may not ~~yet~~prevent or detect misstatements or prevent or detect all error and fraud. Any control system, no matter how well designed and operated, is based upon certain assumptions, and can provide only reasonable, not absolute, assurance that its objectives will be met. Further, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been ~~remediated as~~detected. Projections of ~~March 31, 2020.~~any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

We plan to enhance existing controls ~~by improving their design~~ and to design and implement new controls applicable to our ~~income tax~~equity method accounting, to ensure that our ~~income tax~~equity method investment balances are accurately calculated and appropriately reflected in our financial statements on a timely basis. ~~Specifically,~~We are in the process of implementing a software solution to automate the accounting for share based compensation awards. We are also planning to enhance our controls over the recording of forfeitures to ensure that forfeitures are recorded timely. Lastly, we plan to enhance existing controls and design, and implement new controls to ensure that contracts and agreements are executed timely and that executed copies of contracts are retained

We plan to devote significant time and attention to remediate the above material weakness as soon as reasonably possible. As we continue to evaluate our controls, we will ~~add incremental controls~~make the necessary changes to ~~determine~~improve the ~~income tax effects of unique transactions. We have engaged third party income tax experts to assist in the preparation~~overall design and operation of our ~~income tax provisions.~~controls. We believe ~~that improving the design of existing controls, adding incremental controls to determine the tax effects of unique transactions, and engaging third party tax specialists~~these actions will be sufficient to remediate the identified material weakness and strengthen our internal control over financial reporting; however, there can be no guarantee that such remediation will be sufficient. We will continue to monitor the effectiveness of our controls and will make any further changes management determines appropriate.

There were no changes in our internal control over financial reporting that occurred during the ~~three months~~quarter ended ~~March 31,~~September 30, 2020, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Mackey Investment, LLLP ("Mackey") subscribed for and purchased 500,000 shares of Predictive common stock for $480,000 on or about January 29, 2020. On or about October 19, 2020, Mackey ~~through counsel, sent~~filed a ~~letter demanding~~lawsuit against Predictive, Brad Robinson, Predictive'’s chief executive officer, and Simon Brewer, Predictive's chief financial officer, in the Third District Court in the State of Utah seeking rescission of ~~his investment.~~the investment, damages in an unspecified amount and attorney's fees. He is ~~alleging that Predictive failed~~asserting claims for breach of contract, fraudulent inducement, violation of the Utah Uniform Securities Act and Conspiracy. Based on the information available to ~~disclose~~us, we do not believe any of the Mackey proceedings will have a material ~~information in connection with its investment and has threatened a lawsuit for securities fraud. To date, no lawsuit has been filed. We~~adverse effect on our business, results of operations, financial position, or liquidity. Further, we deny the allegations in the ~~demand letter~~complaint and have not discovered any evidence of wrongdoing with respect to the allegations and will vigorously defend against these allegations.

In June 2020, Wellgistics, LLC, the distributor of the Company's Assurance AB product, requested that the partial deposit paid on their non-cancellable purchase order of $5 million be returned. As the purchase order is contractually non-cancellable and the Company performed on the order in good faith by transmitting the deposit to the Company's supplier, the request to return the deposit was not honored. To date there has been no legal action taken by either party.

There have been no material changes to the risk factors included in our Annual Report on Form 10-K for the fiscal year ended June 30, ~~2019, except as set forth below:~~

~~Those risk factors pertaining our genetic testing products included in our Form 10-K for the fiscal year ended June 30, 2019 also pertain to our Assurance AB™ COVID-19 antibody test.~~

Our business can be impacted by political events, international trade disputes, war, terrorism, natural disasters, public health issues, and industrial accidents, difficulties with our single manufacturer or other business interruptions.

Political events, international trade disputes, war, terrorism, natural disasters, public health issues, industrial accidents and other business interruptions could harm or disrupt international commerce and the global economy, and could have a material adverse effect on our business and our suppliers, contract manufacturers, distributors and other partners.

International trade disputes can result in tariffs and other measures that can adversely affect the sale of our Assurance AB™ COVID-19 antibody test. For example, trade tensions have led to a series of tariffs imposed by the U.S. on imports from China. Tariffs could increase the cost of our Assurance AB™ COVID-19 antibody test. These increased costs adversely impact the gross margin that the Company earns on these tests. Tariffs can also make our Assurance AB™ COVID-19 antibody tests more expensive for customers, which could make our Assurance AB™ COVID-19 antibody test less competitive and reduce consumer demand. Political uncertainty surrounding international trade disputes and measures could also have a negative effect on consumer confidence and spending, which could adversely affect our test sales.

The sole source and manufacturer of our Assurance AB™ COVID-19 antibody test is in China. The contract with our Chinese based manufacturer does not require the manufacturer to supply any minimum or maximum number of tests and the pricing and other purchase terms are subject to negotiation each time a purchase order is submitted. There can be no assurance that this manufacturer will produce a sufficient quantity of tests on a timely basis, that the tests will consistently be of acceptable quality, that the tests can be obtained at a competitive price, that there will not be unanticipated problems in moving tests through customs, that transportation of tests from China will be accomplished on a timely basis or that we will be able to replace its current manufacturer on a timely basis and on acceptable terms should circumstances require a change.

In addition, the manufacture of our Assurance AB™ COVID-19 antibody test is subject to the risk of interruption by fire, power shortages, and other industrial accidents, terrorist attacks and other hostile acts, labor disputes, public health issues and other events beyond our control. Such events could make it difficult or impossible for us to manufacture and deliver our Assurance AB™ COVID-19 antibody test to our customers and distributors. Following an interruption to our business, we could require substantial recovery time, experience significant expenditures to resume operations and lose significant sales. Because we rely on single source for the supply and manufacture of our Assurance AB™ COVID-19 antibody test, a business interruption affecting such source would exacerbate any negative consequences to us.

~~There can be no assurance of market acceptance for our Assurance AB™ COVID-19 antibody test.~~

The commercial success of our Assurance AB™ COVID-19 antibody test will depend upon its acceptance as medically useful and cost-effective by physicians and other members of the medical community, patients and third-party payers. Broad market acceptance can be achieved only with substantial education about the benefits and limitations of such tests, as well as resolution of concerns about their appropriate use. We or our distributor, if any, may be required to expend substantial financial resources to responsibly promote the benefits of our Assurance AB™ COVID-19 antibody test. There can be no assurance our Assurance AB™ COVID-19 antibody test will gain market acceptance on a timely basis, if at all. Failure to achieve market acceptance will have a material adverse effect on our business, financial condition and results of operations.

There can be no assurance that we will be able to maintain or develop appropriate distribution arrangements that will be necessary for us to develop and commercialize our Assurance AB™ COVID-19 antibody test.

Our current strategy is to rely on distribution arrangements to commercialize our Assurance AB™ COVID-19 antibody test. We currently have an exclusive distribution arrangement with Wellgistics, LLC. There can be no assurance that Wellgistics, LLC will be able to successfully market and distribute our Assurance AB™ COVID-19 antibody test. In addition, there can be no assurance that Wellgistics, LLC or any other future collaborative partner will not pursue alternative technologies or develop alternative products either on their own or in collaboration with others, including with our competitors, as a means of developing competitive tests. There is no assurance that we can successfully replace Wellgistics, LLC with one or more future distributors should we be required to make a change in our distribution arrangements. Failure of any distribution arrangement could have a material adverse effect on our business, financial condition or results of operations. A dispute with our current or any future distributor could lead to delays in test sales, or could result in litigation or arbitration, any of which could have a material adverse effect on our business, financial condition or results of operations.

We initially marketed the Assurance AB™ COVID-19 antibody test pursuant to the “Policy for Diagnostic Tests for Coronavirus Disease-2019 during the Public Health Emergency” issued by the United States Food and Drug Administration (FDA) on March 16, 2020. This policy, subject to certain notification and packaging requirements, allows distribution of validated serological tests such as Assurance AB™ for use in CLIA accredited high-complexity laboratories. In parallel, the Company has also submitted an application for Emergency Use Authorization (EUA), which would allow Assurance AB™ to be used at point of care in facilities with a CLIA waiver if approved. Predictive Laboratories also intends to apply for an authorization for home use once the FDA clarifies the standards to be applied to home use products. There can be no assurance that the EUA application will be approved, or that the test will be approved for home use. In addition, the FDA has issued and may issue further additional guidance or change regulatory requirements at any time, which may necessitate costly measures to maintain regulatory compliance, have a detrimental effect on the Company’s ability to market Assurance AB™, or both.

~~The COVID-19 pandemic could have a material impact on our business, results of operation and financial condition, operating results, cash flows and prospects.~~

In December 2019, a novel strain of coronavirus (COVID-19) emerged in Wuhan China. Less than four months later, in March 2020, the World Health Organization declared COVID-19 a pandemic. While the outbreak initially was largely concentrated in China and caused significant disruptions in its economy, the virus has now spread to many other countries and regions, and every state within the United States, including Utah, where our primary offices and manufacturing facility are located.

Towards the end of the third quarter of fiscal 2020 we began to experience, and through the date of this filing we are continuing to experience, impacts to our business and operations related to the COVID-19 pandemic, including the impact of stay-at-home mandates and related safety measures such as the delay of elective medical procedures, resulting in a decline in the volume of procedures using our products. In response to the pandemic, healthcare providers have, and may need to further, reallocate resources, such as physicians, staff and facilities, as they prioritize limited resources and personnel capacity to focus on the treatment of patients with COVID-19 and implement limitations on access to hospitals and other medical institutions due to concerns about the potential spread of COVID-19 in such settings. These actions have significantly delayed the provision of other medical care including elective and diagnostic procedures involving our products, having an adverse effect on our revenue. These measures and challenges may continue for the duration of the COVID-19 pandemic, and such duration is uncertain, and may significantly reduce our revenue and cash flows while the pandemic continues and thereafter until we and our customers are able to resume normal business operations. We anticipate that in the fourth quarter of fiscal 2020, the impact of the COVID-19 pandemic on our business will be more significant than we experienced in the third quarter as pandemic precautions continue to limit demand for our products. We cannot predict the magnitude or duration of the pandemic’s impact on our business.

~~In connection with the COVID-19 pandemic, the following risks could have a material effect on our business, financial condition, results of operations and prospects:~~

• The delay or cancellation by healthcare providers of the elective procedures in which our allograft products are used as a result of their COVID-19 response efforts and the duration of such effects, thereby reducing sales of our products for an unknown period of time;

• The inability or unwillingness of some patients to visit hospitals or clinics in order to undergo elective procedures in which our products are used, thereby reducing sales of our products for an unknown period of time;

• The inability of some patients to pay for elective procedures in which our products are used due to job loss or lack of insurance, thereby reducing sales of our products for an unknown period of time;

• The inability of our distributors and customers to conduct their normal operations, including supplying or conducting procedures in which our products are used, because of their COVID-19 response efforts, or the reduced capacity or productivity of their employees and contractors as a result of possible illness, quarantine or other inability to work, thereby reducing sales of our products for an unknown period of time;

• The inability of global suppliers of raw materials or components used in the manufacture of our products, to supply and/or transport those raw materials, components and products to us in a timely and cost effective manner due to shutdowns, interruptions or delays, limiting and precluding the production of our finished products, impacting our ability to supply customers, reducing our sales, increasing our costs of goods sold, and reducing our absorption of overhead;

• The partial or complete delay or cancellation of international or domestic flights by our airfreight carriers, resulting in our inability to receive raw materials, components and products from our suppliers or to ship and deliver our finished products to our domestic and international customers in a timely or cost effective manner, thereby potentially increasing our freight costs as we seek alternate, potentially more expensive, methods to ship raw materials, components or products, and negatively impacting our sales;

• The reduced capacity or productivity of our operations as a result of possible illness, quarantine or other inability of our employees and contractors to work, despite all of the preventative measures we continue to undertake to protect the health and safety of our workforce;

~~• The illiquidity or insolvency of our suppliers and freight carriers whose business activities could be shut down, interrupted or delayed;~~

• The illiquidity or insolvency of our distributors and customers, or their inability to pay our invoices in full or in a timely manner, due to the reduction in their revenues caused by the cancellation or delay of procedures and other factors, which could potentially reduce our cash flow, reduce our liquidity and increase our bad debt reserves;

~~• A portion of our raw materials or finished product inventory may expire due to reduced demand for our products;~~

• Delays in our ability, and the ability of our development partners to conduct, enroll and complete clinical development programs such as the ARTGUIDE™ clinical development program currently being conducted by the Houston Fertility Institute;

~~• Delays of regulatory reviews and approvals, including with respect to our product candidates, by the FDA or other health or regulatory authorities;~~

• Decreased sales of our products due to the reduction of in-person sales and marketing activities and training caused by travel restrictions, quarantines, other similar social distancing measures and more restrictive healthcare facility access policies;

~~• Our ability to maintain employee morale and motivate and retain management personnel and other key employees as a result of our recent reduction in force;~~

• The instability to worldwide economies, financial markets, social institutions, labor markets and the healthcare systems as a result of the COVID-19 pandemic, which could result in an economic downturn that could adversely impact our business, results of operations and financial condition, as well as that of our suppliers, distributors, customers or other business partners; and

~~• A recurrence of the COVID-19 pandemic after social distancing and other similar measures have been relaxed.~~

The extent to which the COVID-19 pandemic impacts our business and our results of operations and financial condition will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge in connection with the severity of the virus, the ability to treat and ultimately prevent it, its potential recurrence, and actions that may be taken to contain its impact.

~~During the nine months ended March 31, 2020, the Company issued (or is obligated to issue) the following shares:~~None

1) In September 2019, the Company entered into an agreement with a consultant for research and development services. The consultant is an accredited investor. In consideration for these services, the Company granted warrants to the consultant exercisable for 1,250,000 shares of the Company’s common stock with a strike price equal to the closing price of the Company’s common stock on the date of grant. Warrants to acquire 625,000 shares vested upon issuance. Of the remaining warrants, 375,000 vest on March 1, 2020 and 225,000 vest on September 1, 2020. The warrants expire ten years from the date of issuance.

2) On December 31, 2019, four accredited investors agreed to accept repayment in equity shares for promissory notes with a face value of $8,420,000 and the $720,000 outstanding under of the Revolving Loan Agreement, as well as $311,918 in accrued interest thereon. The debt was repaid in full by issuing 12,947,833 shares of the Company’s common stock based on the closing market price on December 31, 2020 of $0.73 per share.

All securities issued by us that are referenced above are deemed "restricted securities" within the meaning of that term as defined in Rule 144 of the Securities Act and have been issued pursuant to the "private placement" exemption under Section 4(a)(2) of the Securities Act. Such transactions did not involve a public offering of securities, no underwriter was involved with the transactions, and no commissions were paid. All purchasers in the private placement had access to information on the Company necessary to make an informed investment decision. We have been informed that all purchasers are able to bear the economic risk of this investment and are aware that the securities were not registered under the Securities Act and cannot be re-offered or re-sold unless they are registered or are qualified for sale pursuant to an exemption from registration. The transfer agent and registrar of the Company was instructed to mark "stop transfer" on its ledger regarding these shares.;

~~Neither the Company nor any person acting on its behalf offered or sold the securities by means of any form of general solicitation or general advertising.~~

The securities were acquired for the purchasers own account and not with the view to sell, or for resale in connection with any distribution. A legend was placed on the certificates issued stating that the securities have not been registered under the Securities Act and cannot be sold or otherwise transferred without an effective registration or an exemption therefrom

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

I, Bradley C. Robinson, certify, to my best knowledge and belief, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Predictive Technology Group, Inc., on Form 10-Q for the quarter ended ~~March 31,~~September 30, 2020 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Predictive Technology Group, Inc.

I, Simon Brewer, certify, to my best knowledge and belief, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the Quarterly Report of Predictive Technology Group, Inc. on Form 10-Q for the quarter ended ~~March 31,~~September 30, 2020, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Quarterly Report on Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Predictive Technology Group, Inc.


(Mark One) [X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the quarterly period ended ~~March 31,~~September 30, 2020
	Or
[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

	For the transition period _______ to _______


Nevada		90-1139372
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer identification number)

2735 Parleys Way, Suite 205, Salt Lake City, Utah		84109
(Address of principal executive offices)		(Zip Code)


Larger Accelerated Filer [ ]	Accelerated Filer [ ]
Non-Accelerated Filer [ ] (Do not check if a smaller reporting company)	Smaller Reporting Company [X]
Emerging growth company [ ]


	PART I - FINANCIAL INFORMATION
Item 1.	Financial Statements
	Unaudited ~~Condensed Consolidated~~condensed consolidated Balance Sheets as of ~~March 31,~~September 30, 2020 and June 30, ~~2019~~2020	2
	Unaudited ~~Condensed Consolidated~~condensed consolidated Statements of Operations and Comprehensive Loss for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 and 2019	3
	Unaudited ~~Condensed Consolidated~~condensed consolidated Statements of Cash Flows for the three ~~and nine~~ months ended ~~March 31,~~September 30, 2020 and 2019	4-5
	Unaudited ~~Condensed Consolidated~~condensed consolidated Statements of ~~Stockholders’~~Stockholders' Equity for the ~~nine~~three months ended ~~March 31,~~September 30, 2020 and 2019	~~6-7~~6
	Unaudited Notes to Condensed ~~Consolidated~~consolidated Financial Statements	87
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	4123
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	5527
Item 4.	Controls and Procedures	5627

	PART II - OTHER INFORMATION	5728
Item 1.	Legal Proceedings	5728
Item 1A.	Risk Factors	5929
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	6429
Item 3.	Defaults Upon Senior Securities	6529
Item 4.	Mine Safety Disclosures	6529
Item 5.	Other Information	6529
Item 6.	Exhibits	6630


		Nine months ended March 31,
		2020		2019
Warrants issued for trade secrets	$	-	$	13,860,000
Common stock issued for the acquisition of InceptionDX, LLC		-		14,260,000
Revaluation of warrants issued for licenses		-		(4,449,211)
Reduction in number of equity method investee units subscribed		-		(1,850,000)
Common stock issued and deferred tax liabilities assumed for the acquisition of Regenerative Medical Technologies, Inc.		-		12,266,667
Right-of-use assets obtained in exchange for new operating lease liabilities		1,903,222		-
Issuance of common stock to settle subscription payable		2,430,000		-
Extinguishment of debt with common stock		9,451,918		-
Capital expenditures in accounts payable		73,333		539,214


	Common Stock				Additional
	Shares		Amount		Paid in Capital		Subscription Receivable		Non-Controlling Interest		Accumulated Deficit		Stockholders’ Equity
BALANCES AT JUNE 30, 2018	247,624,069	$	247,624	$	108,049,300	$	(1,025,000)	$	(120,152)	$	(25,813,957)	$	81,337,815
Common stock issued for acquisition of InceptionDX, LLC	15,500,000		15,500		14,244,500								14,260,000
Common stock issued for services	50,000		50		43,450								43,500
Common stock cancelled	(1,200,000)		(1,200)		1,200								-
Warrants issued for trade secrets					13,860,000								13,860,000
Cash received from common stock subscriptions							325,000						325,000
Share based compensation					928,846								928,846
Net loss									(27,669)		(2,004,382)		(2,032,051)
BALANCES AT SEPTEMBER 30, 2018	261,974,069	$	261,974	$	137,127,296	$	(700,000)	$	(147,821)	$	(27,818,339)	$	108,723,110
Common stock issued for acquisition of Regenerative Medical Technologies, Inc.	10,000,000		10,000		9,190,000								9,200,000
Share based compensation					1,010,505								1,010,505
Revaluation of warrants issued for licenses					(4,449,211)								(4,449,211)
Cash received from common stock subscriptions							700,000						700,000
Net loss									(33,454)		(2,329,438)		(2,362,892)
BALANCES AT DECEMBER 31, 2018	271,974,069	$	271,974	$	142,878,590	$	-	$	(181,275)	$	(30,147,777)	$	112,821,512
Common stock issued for acquisition of Taueret Laboratories, Inc.	552,995		553		1,016,958								1,017,511
Share based compensation					2,254,739								2,254,739
Adoption of ASU 2018-07					(16,278)						16,278		-
Exercise of Stock Options	3,333		3		3,130								3,133
Net loss									(27,735)		(3,708,911)		(3,736,646)
BALANCES AT MARCH 31, 2019	272,530,397	$	272,530	$	146,137,139	$	-	$	(209,010)	$	(33,840,410)	$	112,360,249


	HCT/Ps		Diagnostics & Therapeutics			Unallocated Corporate	Total
Three months ended March 31, 2020
Revenues	$	5,673,451	$	50,533	$	-	$	5,723,984
Depreciation and amortization		897,219		1,759,279		81,667		2,738,165
Share based compensation		1,040,701		225,896		2,468,421		3,735,018
Segment operating loss		(5,805,596)		(3,377,911)		(2,539,971)		(11,723,478)
Three months ended March 31, 2019
Revenues	$	11,285,218	$	10,400	$	-	$	11,295,618
Depreciation and amortization		782,171		1,553,940		37,895		2,374,006
Share based compensation		257,843		7,208		1,989,688		2,254,739
Segment operating loss		(733,327)		(1,688,679)		(2,611,940)		(5,033,946)
Nine months ended March 31, 2020
Revenues	$	21,147,347	$	172,535	$	-	$	21,319,882
Depreciation and amortization		2,734,087		5,147,127		242,270		8,123,484
Share based compensation		3,955,032		930,350		8,478,305		13,363,687
Segment operating loss		(19,285,305)		(9,833,261)		(9,224,488)		(38,343,054)
Nine months ended March 31, 2019
Revenues	$	30,036,056	$	10,400	$	-	$	30,046,456
Depreciation and amortization		2,295,055		3,667,718		112,317		6,075,090
Share based compensation		629,681		15,394		3,593,715		4,238,790
Segment operating loss		(334,745)		(4,005,832)		(5,500,304)		(9,840,881)


	HCT/Ps		Diagnostics & Therapeutics			Unallocated Corporate	Total
Three months ended September 30, 2020
Revenues	$	3,869,258	$	1,221,746	$	-	$	5,091,004
Depreciation and amortization		914,064		1,480,959		89,060		2,484,083
Share based compensation		358,173		140,770		2,437,637		2,936,580
Segment operating loss		(9,166,825)		(2,311,458)		(3,085,398)		(14,563,681)
Three months ended September 30, 2019
Revenues	$	8,184,631	$	74,626	$	-	$	8,259,257
Depreciation and amortization		898,944		1,631,308		79,993		2,610,245
Share based compensation		1,671,456		450,101		2,873,043		4,994,600
Segment operating loss		(6,543,985)		(3,228,651)		(3,119,541)		(12,892,177)


		As of March 31,		As of June 30,
Total Assets		2020		2019
HCT/Ps	$	13,320,652	$	21,052,083
Diagnostics and therapeutics		99,293,376		120,665,445
Unallocated corporate		1,403,246		1,860,657
Total Assets	$	114,017,274	$	143,578,185


		As of September		As of June 30,
Total Assets		30, 2020		2020
HCT/Ps	$	3,534,481	$	11,980,175
Diagnostics and therapeutics		69,621,039		70,394,152
Unallocated corporate		1,230,064		1,468,088
Total Assets	$	74,385,584	$	83,842,415



Assets:		Amount
Cash	$	799,980
Lab equipment		1,177,750
Investment in non-controlling interest		440,000
Trade secrets		11,842,270
Total purchase price	$	14,260,000


~~Risk-free interest rate~~		~~2.7%~~
~~Expected dividend yield~~		0%
~~Expected life (in years)~~		~~5.0~~
~~Expected volatility~~		~~150%~~


Assets:	Fair Value
Current assets	$	663,262
Laboratory equipment	190,397
Software	239,000
Intangible Assets	311,000
Total assets acquired	1,403,659
Liabilities:
Accrued liabilities	(68,181)
Capital lease obligation	(54,291)
Total liabilities assumed	(122,472)
Bargain purchase gain	(363,676)
Total fair value of purchase price	$	917,511
Consideration allocated to Preeclampsia Option		100,000
Total consideration	$	1,017,511
Less: Cash acquired		(85,694)
Total consideration transferred	$	931,817


		As of March 31,		June 30,
		2020		2019
Finished goods	$	1,085,742	$	918,199
Work-in-process		900,902		4,485,349
Raw materials and supplies		203,649		371,637
Total inventory on hand	$	2,190,293	$	5,775,185



		Goodwill		Accumulated Impairment Losses
As of June 30, 2020	$	5,254,451	$	-
Impairment of Goodwill		-		(5,254,451)
As of September 30, 2020	$	5,254,451	$	(5,254,451)


Juneau Biosciences, LLC		Year ended December 31, 2019		Year ended December 31, 2018
		Unaudited
Revenue (related party)	$	202,010	$	2,554,037
Gross profit		202,010		2,554,037
Loss from operations		(1,890,382)		(2,419,890)
Net loss		(1,889,921)		(2,419,824)
Net loss attributable to Predictive Technology Group, Inc.		(912,454)		(1,200,238)


		Number of Warrants		Weighted Average Exercise Price	Weighted Average Remaining Contractual Life (Years)
Outstanding June 30, 2019		68,253,520	$	0.78	3.6
	Granted	1,250,000		1.73	9.5
	Exercised	(9,223,605)		0.50	2.5
	Forfeited/ Cancelled	(7,286,395)		0.81	3.1
Outstanding March 31, 2020		52,993,520	$	0.84	3.0



	As of September 30,
	2020	2019
Warrants for common stock	53,093,520	58,443,520
Options for common stock	28,055,733	25,012,750
	81,149,253	83,456.270


			Three months ended March 31, 2020		Nine months ended March 31, 2020
Lease cost
Finance lease cost
	Amortization of right of use assets	$	172,812	$	518,436
	Interest on lease liabilities		36,157		81,058
Operating lease cost			236,683		463,089
Short-term lease cost			900		65,687
Total lease cost		$	446,552	$	1,128,270

Cash paid for amounts included in the measurement of
lease liabilities
	Operating cash flows from finance leases	$	36,157	$	81,058
	Operating cash flows from operating leases		238,408		533,705
	Financing cash flows from finance leases		160,387		341,306

Weighted average remaining lease term — finance leases (Years)			2.36
Weighted average remaining lease term — operating leases (Years)			1.50
Weighted average discount rate — finance leases			8.06%
Weighted average discount rate — operating leases			8.63%


			September 30, 2020		September 30, 2019
Lease cost
Finance lease cost
	Amortization of right of use assets	$	214,338	$	24,413
	Interest on lease liabilities		29,604		4,413
Operating lease cost			236,683		104,404
Short-term lease cost			2,754		64,337
Total lease cost		$	483,379	$	197,567

Cash paid for amounts included in the measurement of
lease liabilities
	Operating cash flows from finance leases	$	29,604	$	4,413
	Operating cash flows from operating leases		236,683		102,357
	Financing cash flows from finance leases		163,159		24,413

Weighted average remaining lease term - finance leases (Years)			1.90		2.94
Weighted average remaining lease term - operating leases (Years)			1.00		1.25
Weighted average discount rate - finance leases			8.06%		8.11%
Weighted average discount rate - operating leases			8.63%		9.69%




Exhibit No.	Identification of Exhibit
31.1	Section 302 Certification of Chief Executive Officer (filed herewith)
31.2	Section 302 Certification of Principal Financial Officer (filed herewith)
32.1	Section 906 Certification of Chief Executive Officer (filed herewith)
32.2	Section 906 Certification of Principal Financial Officer (filed herewith)
101	XBRL Interactive Data Tags


	Predictive Technology Group, Inc., (Registrant)

	By:	/s/ Bradley C. Robinson
~~May 15,~~November 16, 2020		Bradley C. Robinson Chief Executive Officer and Director (Principal Executive Officer)

	By:	/s/ Simon Brewer
~~May 15,~~November 16, 2020		Simon Brewer Chief Accounting Officer (Principal Accounting and Principal Financial Officer)



1.		I have reviewed this quarterly report of Predictive Technology Group, Inc. (“("the ~~registrant”~~registrant") on Form 10-Q;
2.		Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.		Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.		The ~~registrant’s~~registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a)		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its condensed consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)		Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)		Evaluated the effectiveness of the ~~registrant’s~~registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d)		Disclosed in this report any change in the ~~registrant’s~~registrant's internal control over financial reporting that occurred during the ~~registrant’s~~registrant's most recent fiscal quarter (the ~~registrant’s~~registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the ~~registrant’s~~registrant's internal control over financial reporting.
5.		The ~~registrant’s~~registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the ~~registrant’s~~registrant's auditors and the audit committee of the ~~registrant’s~~registrant's board of directors (or persons performing the equivalent functions):
	a)		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the ~~registrant’s~~registrant's ability to record, process, summarize and report financial information; and
	b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the ~~registrant’s~~registrant's internal control over financial reporting.