| Significant and Critical Accounting Policies and Practices | Note 3 - Significant and Critical Accounting
Policies and Practices Basis of Presentation and Principles of
Consolidation On June 14, 2018 the Company completed the
purchase all of the outstanding shares of CLC such that CLC became a wholly-owned subsidiary of the Company and was immediately
thereafter merged with and into the Company, with the Company surviving. Accordingly, as of June 14, 2018 the Company no longer
has any subsidiaries consolidated in these financial statements. For the year ended December 31, 2017 and through
June 14, 2018, the accompanying condensed consolidated financial statements include the accounts of the Company’s subsidiaries.
For consolidated entities where the Company owns less than 100% of the subsidiary, the Company records net loss attributable to
non-controlling interests in its condensed consolidated statements of operations equal to the percentage of the economic or ownership
interest retained in such entities by the respective non-controlling parties. The condensed consolidated balance at December
31, 2017 was derived from audited annual financial statements but do not contain all of the footnote disclosures from the annual
financial statements. The unaudited condensed financial statements have been prepared by the Company pursuant to the rules and
regulations of the Securities and Exchange Commission (the “SEC”) and reflect all adjustments (consisting of normal
recurring adjustments unless otherwise indicated) which, in the opinion of management, are necessary for a fair presentation of
the results for the interim periods presented. Certain information in footnote disclosures
normally included in the financial statements prepared in conformity with accounting principles generally accepted in the United
States of America have been condensed or omitted pursuant to the SEC rules and regulations for interim reporting. The financial
results for the periods presented may not be indicative of the full year’s results. These unaudited condensed financial statements
should be read in conjunction with the Company’s audited consolidated financial statements and the notes thereto for the
fiscal year ended December 31, 2017 included in the Company’s Annual Report on Form 10-K filed on April 2, 2018. Use of Estimates The Company’s condensed financial statements
include certain amounts that are based on management’s best estimates and judgments. The Company’s significant estimates
include, but are not limited to, useful lives assigned to long-lived assets, fair value used in estimating the value of warrants,
stock-based compensation, accrued expenses and provisions for income taxes. Due to the uncertainty inherent in such estimates,
actual results may differ from these estimates. Cash As of September 30, 2018 and December 31, 2017,
substantially all of the Company’s cash was held by major financial institutions and the balance at certain times may exceed
the maximum amount insured by the Federal Deposits Insurance Corporation. However, the Company has not experienced losses on these
accounts and management believes that the Company is not exposed to significant risks on such accounts. Property and Equipment Lab equipment, leasehold improvements and office
equipment are recorded at cost and depreciated using the straight-line method over the estimated useful life of each asset, generally
three to seven years. Impairment of Long-Lived Assets The Company reviews long-lived assets, including
property and equipment, for impairment whenever events or changes in business circumstances indicate that the carrying amount of
the assets may not be fully recoverable. Factors that the Company considers in deciding when to perform an impairment review include
significant underperformance of the business in relation to expectations, significant negative industry or economic trends, and
significant changes or planned changes in the use of the assets. If an impairment review is performed to evaluate a long-lived
asset for recoverability, the Company compares forecasts of undiscounted cash flows expected to result from the use and eventual
disposition of the long-lived asset to its carrying value. An impairment loss would be recognized when estimated undiscounted future
cash flows expected to result from the use of an asset are less than its carrying amount. The impairment loss would be based on
the excess of the carrying value of the impaired asset over its fair value. There were no indicators of impairment for long-lived
assets during the nine months ended September 30, 2018. Fair Value of Preferred Stock The fair value of Preferred stock was estimated
based upon equivalent common shares that Preferred Stock could have been converted into at the closing price on the purchase date. Convertible Financial Instruments The Company bifurcates conversion options from
their host instruments and accounts for them as free standing derivative financial instruments if certain criteria are met. The
criteria include circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument are not
clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument that embodies
both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable generally
accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument with
the same terms as the embedded derivative instrument would be considered a derivative instrument. An exception to this rule is
when the host instrument is deemed to be conventional, as that term is described under applicable GAAP. When the Company has determined that the embedded
conversion options should not be bifurcated from their host instruments, discounts are recorded for the intrinsic value of conversion
options embedded in the instruments based upon the differences between the fair value of the underlying common stock at the commitment
date of the transaction and the effective conversion price embedded in the instrument. Deemed dividends are also recorded for the
intrinsic value of conversion options embedded in preferred shares based upon the differences between the fair value of the underlying
common stock at the commitment date of the transaction and the effective conversion price embedded in the preferred shares. Research and Development Research and development costs are expensed
as incurred. Advance payments for goods and services that will be used in future research and development activities are expensed
when the activity has been performed or when the goods have been received rather than when the payment is made. Upfront and milestone
payments due to third parties that perform research and development services on the Company’s behalf will be expensed as
services are rendered or when the milestone is achieved. Research and development costs primarily consist
of personnel related expenses, including salaries, benefits, travel, and other related expenses, stock-based compensation, payments
made to third parties for license and milestone costs related to in-licensed products and technology, payments made to third party
contract research organizations, consultants, the cost of acquiring and manufacturing research trial materials, and costs associated
with regulatory filings, laboratory costs and other supplies. In accordance with ASC 730-10-25-1, Research
and Development During the nine months ended September 30,
2018, in addition to ongoing efforts at one major research university, the Company entered into additional contracts with a national
research lab and another major research university for additional work related to development and scale-up of the Company’s
processes. The Company also commenced research and development efforts at the Company’s Yonkers lab facility. Contingencies The Company records accruals for contingencies
and legal proceedings expected to be incurred in connection with a loss contingency when it is probable that a liability has been
incurred and the amount can be reasonably estimated. If a loss contingency is not probable but is
reasonably possible, or is probable but cannot be estimated, the nature of the contingent liability, together with an estimate
of the range of possible loss if determinable and material, would be disclosed. Stock-Based Compensation The Company expenses stock-based compensation
to employees over the requisite service period based on the estimated grant-date fair value of the awards. For stock-based compensation
awards to non-employees, the Company remeasures the fair value of the non-employee awards at each reporting period prior to vesting
and finally at the vesting date of the award. Changes in the estimated fair value of these non-employee awards are recognized as
compensation expense in the period of change. The Company estimates the fair value of stock
options grants using the Black-Scholes option pricing model and the assumptions used in calculating the fair value of stock-based
awards represent management’s best estimates and involve inherent uncertainties and the application of management’s
judgment. Income Taxes The Company records income taxes using the
asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax effects attributable to
temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective
income tax bases, and operating loss and tax credit carryforwards. The Company establishes a valuation allowance if it is more
likely than not that the deferred tax assets will not be recovered based on an evaluation of objective verifiable evidence. For
tax positions that are more likely than not of being sustained upon audit, the Company recognizes the largest amount of the benefit
that is greater than 50% likely of being realized. For tax positions that are not more likely than not of being sustained upon
audit, the Company does not recognize any portion of the benefit. Loss Per Share Basic loss per share of common stock is computed
by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding for
the period. Diluted loss per share excludes the potential impact of common stock options, convertible preferred stock and outstanding
common stock purchase warrants because their effect would be anti-dilutive. Securities that could potentially dilute loss
per share in the future that were not included in the computation of diluted loss per share at September 30, 2018 and 2017 are
as follows:
As of September 30,
2018 2017
Warrants to purchase common stock 4,719,292 4,744,292
Options to purchase common stock 16,024,000 8,880,000
Preferred stock convertible into common stock 2,348,060 -
Total 23,091,352 13,624,292 Non-Controlling Interests Non-controlling interests in consolidated entities
represent the component of equity in consolidated entities held by third parties. Any change in ownership of a subsidiary while
the controlling financial interest is retained is accounted for as an equity transaction between the controlling and non-controlling
interests. Recent Accounting Pronouncements The Company considers the applicability and
impact of all Accounting Standard Updates (“ASUs”). ASUs not discussed below were assessed and determined to be either
not applicable or are expected to have minimal impact on our balance sheets or statements of operations. In August 2018, the Financial Accounting Standards
Board (“FASB”) issued ASU 2018-13, “Fair Value Measurement (Topic 820), – Disclosure Framework –
Changes to the Disclosure Requirements for Fair Value Measurement,” which makes a number of changes meant to add, modify
or remove certain disclosure requirements associated with the movement amongst or hierarchy associated with Level 1, Level 2 and
Level 3 fair value measurements. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning
after December 15, 2019. Early adoption is permitted upon issuance of the update. The Company is still evaluating but does not
expect the adoption of this guidance to have a material impact on its condensed Financial Statements. In August 2018, the SEC adopted the final rule
under SEC Release No. 33-10532, Disclosure Update and Simplification, amending certain disclosure requirements that were redundant,
duplicative, overlapping, outdated or superseded. In addition, the amendments expanded the disclosure requirements on the analysis
of stockholders’ equity for interim financial statements. Under the amendments, an analysis of changes in each caption of
stockholders’ equity presented in the balance sheet must be provided in a note or separate statement. The analysis should
present a reconciliation of the beginning balance to the ending balance of each period for which a statement of comprehensive income
is required to be filed. This final rule is effective on November 5, 2018. The Company plans to adopt this change in Q1 2019. In June 2018, the FASB issued ASU 2018-07,
“Improvements to Nonemployee Share-Based Payment Accounting”, which simplifies the accounting for share-based payments
granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned
with the requirements for share-based payments granted to employees. The changes take effect for public companies for fiscal years
starting after December 15, 2018, including interim periods within that fiscal year. For all other entities, the amendments are
effective for fiscal years beginning after December 15, 2019, and interim periods within fiscal years beginning after December
15, 2020. Early adoption is permitted, but no earlier than an entity’s adoption date of Topic 606. We are still evaluating
but expect the adoption of this pronouncement will eliminate significant fluctuation in stock based compensation expensed in the
past due to awards to non-employees. In July 2017, the FASB issued ASU 2017-11,
Earnings Per Share (Topic 260), Distinguishing Liabilities from Equity (Topic 480) and Derivatives and Hedging (Topic 815): I.
Accounting for Certain Financial Instruments with Down Round Features; II. Replacement of the Indefinite Deferral for Mandatorily
Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with
a Scope Exception, (ASU 2017-11). Part I of this update addresses the complexity of accounting for certain financial instruments
with down round features. Down round features are features of certain equity-linked instruments (or embedded features) that result
in the strike price being reduced on the basis of the pricing of future equity offerings. Current accounting guidance creates cost
and complexity for entities that issue financial instruments (such as warrants and convertible instruments) with down round features
that require fair value measurement of the entire instrument or conversion option. Part II of this update addresses the difficulty
of navigating Topic 480, Distinguishing Liabilities from Equity, because of the existence of extensive pending content in the FASB
Accounting Standards Codification. This pending content is the result of the indefinite deferral of accounting requirements about
mandatorily redeemable financial instruments of certain nonpublic entities and certain mandatorily redeemable noncontrolling interests.
The amendments in Part II of this update do not have an accounting effect. This ASU is effective for fiscal years, and interim
periods within those years, beginning after December 15, 2018. The Company is currently assessing the potential impact of adopting
ASU 2017-11 on its financial statements and related disclosures. In May 2017, the FASB issued ASU 2017-09, Compensation-Stock
Compensation (Topic 718): Scope of Modification Accounting In February 2016, the FASB issued ASU 2016-02,
Leases (Topic 842) and subsequent amendments to the initial guidance: ASU 2017-13, ASU 2018-10 and ASU 2018-11 (collectively, Topic
842). Topic 842 requires companies to generally recognize on the balance sheet operating and financing lease liabilities and corresponding
right-of-use assets. Topic 842 is effective for us in our first quarter of fiscal 2020, and earlier adoption is permitted. We are
currently evaluating the impact of our pending adoption of Topic 842 on our consolidated financial statements. We currently expect
that most of our operating lease commitments (see MD&A for commitments) will be subject to the new standard and recognized
as operating lease liabilities and right-of-use assets upon our adoption of Topic 842, which will increase our total assets and
total liabilities that we report relative to such amounts prior to adoption. In July 2018, the FASB issued ASU 2018-10,
Codification Improvements to Topic 842, Leases which clarifies, corrects or consolidates authoritative guidance issued in ASU 2016-02
and is effective upon adoption of ASU 2016-02. In July 2018, the FASB issued ASU 2018-11, Targeted Improvements, which provides
an optional transition method that allows entities to elect to apply the standard prospectively at its effective date, versus recasting
the prior periods presented. If elected, an entity would recognize a cumulative effect adjustment to the opening balance of retained
earnings in the period of adoption. The Company is still evaluating the method of adopting the standard. In August 2016, the FASB issued ASU 2016-15,
Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments, which addresses eight specific cash flow
issues with the objective of reducing the existing diversity in practice in how certain cash receipts and cash payments are presented
and classified in the statement of cash flows. The standard is effective for fiscal years beginning after December 15, 2017, including
interim periods within those fiscal years. The Company adopted the standard as of January 1, 2018 and adoption did not have a
material impact on its condensed statement of cash flows. |
