Cover
Cover - shares | 3 Months Ended | |
Jun. 30, 2022 | Aug. 15, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Jun. 30, 2022 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2023 | |
Current Fiscal Year End Date | --03-31 | |
Entity File Number | 001-15697 | |
Entity Registrant Name | ELITE PHARMACEUTICALS, INC. | |
Entity Central Index Key | 0001053369 | |
Entity Tax Identification Number | 22-3542636 | |
Entity Incorporation, State or Country Code | NV | |
Entity Address, Address Line One | 165 LUDLOW AVENUE | |
Entity Address, City or Town | NORTHVALE | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 07647 | |
City Area Code | (201) | |
Local Phone Number | 750-2646 | |
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | ELTP | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 1,011,281,988 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Current assets: | ||
Cash | $ 19,779,584 | $ 8,535,357 |
Accounts receivable | 3,965,109 | 3,057,913 |
Inventory | 7,617,163 | 6,741,170 |
Prepaid expenses and other current assets | 507,923 | 526,949 |
Total current assets | 31,869,779 | 18,861,389 |
Property and equipment, net of accumulated depreciation of $13,641,313 and $13,348,565, respectively | 5,754,841 | 5,952,992 |
Intangible assets, net of accumulated amortization of $-0-, respectively | 6,634,035 | 6,634,035 |
Operating lease - right-of-use asset | 980,871 | 1,031,884 |
Deferred income tax asset | 2,171,821 | 2,171,821 |
Other assets: | ||
Restricted cash - debt service for NJEDA bonds | 405,163 | 405,039 |
Security deposits | 291,738 | 91,738 |
Total other assets | 696,901 | 496,777 |
Total assets | 48,108,248 | 35,148,898 |
Current liabilities: | ||
Accounts payable | 1,614,260 | 1,430,985 |
Accrued expenses | 4,809,835 | 4,693,142 |
Deferred revenue, current portion | 13,333 | 13,333 |
Bonds payable, current portion, net of bond issuance costs | 100,822 | 100,822 |
Loans payable, current portion | 334,134 | 253,006 |
Lease obligation - operating lease, current portion | 207,373 | 202,953 |
Total current liabilities | 7,079,757 | 6,694,241 |
Long-term liabilities: | ||
Deferred revenue, net of current portion | 28,889 | 32,226 |
Bonds payable, net of current portion and bond issuance costs | 1,143,394 | 1,139,848 |
Loans payable, net of current portion and loan costs | 12,063,213 | 249,046 |
Lease obligation - operating lease, net of current portion | 782,232 | 835,893 |
Derivative financial instruments - warrants | 1,436,980 | 936,837 |
Other long-term liabilities | 40,551 | 38,780 |
Total long-term liabilities | 15,495,259 | 3,232,630 |
Total liabilities | 22,575,016 | 9,926,871 |
Shareholders’ equity: | ||
Series J convertible preferred stock; par value of $0.01; 50 shares authorized; 0 issued and outstanding as of June 30, 2022 and March 31, 2022 | ||
Common stock; par value $0.001; 1,445,000,000 shares authorized; 1,011,381,988 shares issued as of June 30, 2022 and March 31, 2022; 1,011,281,988 shares outstanding as of June 30, 2022 and March 31, 2022. | 1,011,385 | 1,011,385 |
Additional paid-in capital | 164,582,549 | 164,577,227 |
Treasury stock; 100,000 shares as of June 30, 2022 and March 31, 2022; at cost | (306,841) | (306,841) |
Accumulated deficit | (139,753,861) | (140,059,744) |
Total shareholders’ equity | 25,533,232 | 25,222,027 |
Total liabilities and shareholders’ equity | $ 48,108,248 | $ 35,148,898 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Accumulated depreciation | $ 13,641,313 | $ 13,348,565 |
Accumulated amortization on intangible assets | $ 0 | $ 0 |
Preferred stock, par value stated value per share | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50 | 50 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,445,000,000 | 1,445,000,000 |
Common stock, shares issued | 1,011,381,988 | 1,011,381,988 |
Common stock, shares outstanding | 1,011,281,988 | 1,011,281,988 |
Treasury stock, shares | 100,000 | 100,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Revenue: | ||
Manufacturing fees | $ 6,327,141 | $ 5,750,036 |
Licensing fees | 1,345,767 | 1,306,753 |
Total revenue | 7,672,908 | 7,056,789 |
Cost of manufacturing | 3,675,061 | 3,503,262 |
Gross profit | 3,997,847 | 3,553,527 |
Operating expenses: | ||
Research and development | 955,443 | 1,202,192 |
General and administrative | 1,718,104 | 1,070,664 |
Non-cash compensation through issuance of stock options | 5,322 | 2,811 |
Depreciation and amortization | 296,294 | 312,702 |
Total operating expenses | 2,975,163 | 2,588,369 |
Income from operations | 1,022,684 | 965,158 |
Other income (expense): | ||
Change in fair value of derivative instruments | (500,143) | 614,461 |
Interest expense and amortization of debt issuance costs | (216,787) | (45,893) |
Interest income | 129 | 42 |
Other (expense) income, net | (716,801) | 568,610 |
Income from operations before income taxes | 305,883 | 1,533,768 |
Net benefit for sale of state net operating losses and credits | 855,350 | |
Net income attributable to common shareholders | $ 305,883 | $ 2,389,118 |
Basic net income per share attributable to common shareholders | $ 0 | $ 0 |
Diluted net income per share attributable to common shareholders | $ 0 | $ 0 |
Basic weighted average Common Stock outstanding | 1,011,381,988 | 1,009,199,886 |
Diluted weighted average Common Stock outstanding | 1,011,381,988 | 1,009,199,886 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($) | Preferred Stock [Member] Series J Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings [Member] | Total |
Beginning balance, value at Mar. 31, 2021 | $ 1,009,279 | $ 164,407,480 | $ (306,841) | $ (148,957,989) | $ 16,151,929 | |
Beginning balance, shares at Mar. 31, 2021 | 1,009,276,752 | 100,000 | ||||
Net income | 2,389,118 | 2,389,118 | ||||
Non-cash compensation through the issuance of employee stock options | 2,811 | 2,811 | ||||
Shares issued in payment of salaries | $ 2,106 | 155,394 | 157,500 | |||
Shares issued in payment of salaries, shares | 2,105,236 | |||||
Ending balance, value at Jun. 30, 2021 | $ 1,011,385 | 164,565,685 | $ (306,841) | (146,568,871) | 18,701,358 | |
Ending balance, shares at Jun. 30, 2021 | 1,011,381,988 | 100,000 | ||||
Beginning balance, value at Mar. 31, 2022 | $ 1,011,385 | 164,577,227 | $ (306,841) | (140,059,744) | 25,222,027 | |
Beginning balance, shares at Mar. 31, 2022 | 1,011,381,988 | 100,000 | ||||
Net income | 305,883 | 305,883 | ||||
Non-cash compensation through the issuance of employee stock options | 5,322 | 5,322 | ||||
Ending balance, value at Jun. 30, 2022 | $ 1,011,385 | $ 164,582,549 | $ (306,841) | $ (139,753,861) | $ 25,533,232 | |
Ending balance, shares at Jun. 30, 2022 | 1,011,381,988 | 100,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 305,883 | $ 2,389,118 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 296,294 | 312,702 |
Amortization of operating leases - right-of-use assets | 51,013 | 57,530 |
Change in fair value of derivative financial instruments - warrants | 500,143 | (614,461) |
Non-cash compensation accrued | 143,870 | 218,808 |
Non-cash compensation through the issuance of employee stock options | 5,322 | 2,811 |
Non-cash rent expense and lease accretion | 602 | 567 |
Change in operating assets and liabilities: | ||
Accounts receivable | (907,196) | 118,641 |
Inventory | (875,993) | (1,690,615) |
Prepaid expenses and other current assets | (180,974) | 251,896 |
Accounts payable, accrued expenses and other current liabilities | 156,098 | 731,566 |
Deferred revenue | (3,337) | (3,333) |
Lease obligations - operating leases | (49,241) | (59,771) |
Net cash (used in) provided by operating activities | (557,516) | 1,715,459 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (94,597) | (4,950) |
Net cash used in investing activities | (94,597) | (4,950) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from loans payable | 12,000,000 | |
Other loan payments | (103,536) | (152,549) |
Net cash provided by (used in) financing activities | 11,896,464 | (152,549) |
Net change in cash and restricted cash | 11,244,351 | 1,557,960 |
Cash and restricted cash, beginning of period | 8,940,396 | 3,597,781 |
Cash and restricted cash, end of period | 20,184,747 | 5,155,741 |
Supplemental disclosure of cash and non-cash transactions: | ||
Cash paid for interest | 216,787 | 14,043 |
Financing of equipment purchases and insurance renewal | 244,124 | |
Stock issued in payment of Directors fees, salaries and consulting expenses | 157,500 | |
Supplemental non-cash amounts of lease liabilities arising from obtaining right of use assets | $ 1,042,799 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Overview Elite Pharmaceuticals, Inc. (the “Company” or “Elite”) was incorporated on October 1, 1997 under the laws of the State of Delaware, and its wholly-owned subsidiary Elite Laboratories, Inc. (“Elite Labs”) was incorporated on August 23, 1990 under the laws of the State of Delaware. On January 5, 2012, Elite Pharmaceuticals was reincorporated under the laws of the State of Nevada. Elite Labs engages primarily in researching, developing, licensing and manufacture of generic, oral dose pharmaceuticals. The Company is equipped to manufacture controlled-release products on a contract basis for third parties and itself, if and when the product candidates are approved. These products include drugs that cover therapeutic areas for allergy, bariatric, attention deficit and infection. Research and development activities are performed with an objective of developing product candidates that will secure marketing approvals from the United States Food and Drug Administration (“FDA”), and thereafter, commercially exploiting such products. Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Elite Labs. All significant intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring items, which are, in the opinion of management, necessary for a fair presentation of such statements. The results of operations for the three months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the entire year. Segment Information Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 280 (“ASC 280”), Segment Reporting The Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial performance and the results of operations of the segments prepared in accordance with GAAP when making decisions about allocating resources and assessing performance of the Company. The Company has determined that its reportable segments are products whose marketing approvals were secured via an Abbreviated New Drug Applications (“ANDA”) and products whose marketing approvals were secured via a New Drug Application (“NDA”). ANDA products are referred to as generic pharmaceuticals and NDA products are referred to as branded pharmaceuticals. There are currently no intersegment revenues. Asset information by operating segment is not presented below since the chief operating decision maker does not review this information by segment. The reporting segments follow the same accounting policies used in the preparation of the Company’s condensed unaudited consolidated financial statements. Please see Note 15 for further details. Revenue Recognition The Company generates revenue primarily from manufacturing and licensing fees. Manufacturing fees include the development of pain management products, manufacturing of a line of generic pharmaceutical products with approved ANDA, through the manufacture of formulations and the development of new products. Licensing fees include the commercialization of products either by license and the collection of royalties, or the expansion of licensing agreements with other pharmaceutical companies, including co-development projects, joint ventures and other collaborations. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Under ASC 606, Revenue from Contacts with Customers Nature of goods and services The following is a description of the Company’s goods and services from which the Company generates revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each, as applicable: a) Manufacturing Fees The Company is equipped to manufacture controlled-release products on a contract basis for third parties, if, and when, the products are approved. These products include products using controlled-release drug technology. The Company also develops and markets (either on its own or by license to other companies) generic and proprietary controlled-release pharmaceutical products. The Company recognizes revenue when the customer obtains control of the Company’s product based on the contractual shipping terms of the contract. The Company is primarily responsible for fulfilling the promise to provide the product, is responsible to ensure that the product is produced in accordance with the related supply agreement and bears risk of loss while the inventory is in-transit to the commercial partner. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products to a customer. b) License Fees The Company enters into licensing and development agreements, which may include multiple revenue generating activities, including milestones payments, licensing fees, product sales and services. The Company analyzes each element of its licensing and development agreements in accordance with ASC 606 to determine appropriate revenue recognition. The terms of the license agreement may include payment to the Company of licensing fees, non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation. The Company determines standalone selling prices based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. The Company recognizes revenue from non-refundable upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer. For those milestone payments which are contingent on the occurrence of particular future events (for example, payments due upon a product receiving FDA approval), the Company determined that these need to be considered for inclusion in the calculation of total consideration from the contract as a component of variable consideration using the most-likely amount method. As such, the Company assesses each milestone to determine the probability and substance behind achieving each milestone. Given the inherent uncertainty of the occurrence of future events, the Company will recognize revenue from the milestone when there is not a high probability of a reversal of revenue, which typically occurs near or upon achievement of the event. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Significant management judgment is required to determine the level of effort required under an arrangement and the period over which the Company expects to complete its performance obligations under the arrangement. If the Company cannot reasonably estimate when its performance obligations either are completed or become inconsequential, then revenue recognition is deferred until the Company can reasonably make such estimates. Revenue is then recognized over the remaining estimated period of performance using the cumulative catch-up method. When determining the transaction price of a contract, an adjustment is made if payment from a customer occurs either significantly before or significantly after performance, resulting in a significant financing component. Applying the practical expedient in ASC 606-10-32-18, the Company does not assess whether a significant financing component exists if the period between when the Company performs its obligations under the contract and when the customer pays is one year or less. None of the Company’s contracts contained a significant financing component as of June 30, 2022. In accordance with ASC 606-10-55-65, royalties are recognized when the subsequent sale of the customer’s products occurs. The Company entered into a sales and distribution licensing agreement with Epic Pharma LLC, (“Epic”) dated June 4, 2015 (the “2015 Epic License Agreement”), which has been determined to satisfy the criteria for consideration as a collaborative agreement, and is accounted for accordingly. The 2015 Epic License Agreement expired on June 4, 2020 without renewal. The Company entered into a Master Development and License Agreement with SunGen Pharma LLC dated August 24, 2016 (the “SunGen Agreement”), which has been determined to satisfy the criteria for consideration as a collaborative agreement, and is accounted for accordingly. On April 3, 2020, Elite and SunGen mutually agreed to discontinue any further joint product development activities. Disaggregation of revenue In the following table, revenue is disaggregated by type of revenue generated by the Company. The table also includes a reconciliation of the disaggregated revenue with the reportable segments: SCHEDULE OF DISAGGREGATION OF REVENUE For the Three Months Ended June 30, 2022 2021 NDA: Licensing fees $ — $ — Manufacturing fees $ 6,327,141 $ 5,750,036 Total NDA revenue — — ANDA: Manufacturing fees $ 6,327,141 $ 5,750,036 Licensing fees 1,345,767 1,306,753 Total ANDA revenue 7,672,908 7,056,789 Total revenue $ 7,672,908 $ 7,056,789 Cash The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks and money market instruments. The Company places its cash and cash equivalents with high-quality, U.S. financial institutions and, to date has not experienced losses on any of its balances. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Restricted Cash As of June 30, 2022, and March 31, 2022, the Company had $ 405,163 405,039 Accounts Receivable Accounts receivable are comprised of balances due from customers, net of estimated allowances for uncollectible accounts. In determining collectability, historical trends are evaluated, and specific customer issues are reviewed on a periodic basis to arrive at appropriate allowances. Inventory Inventory is recorded at the lower of cost or net realizable value on specific identification by lot number basis. Long-Lived Assets The Company periodically evaluates the fair value of long-lived assets, which include property and equipment and intangibles, whenever events or changes in circumstances indicate that its carrying amounts may not be recoverable. Property and equipment are stated at cost. Depreciation is provided on the straight-line method based on the estimated useful lives of the respective assets which range from three forty years Upon retirement or other disposition of assets, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss, if any, is recognized in income. Intangible Assets The Company capitalizes certain costs to acquire intangible assets; if such assets are determined to have a finite useful life they are amortized on a straight-line basis over the estimated useful life. Costs to acquire indefinite lived intangible assets, such as costs related to ANDAs are capitalized accordingly. The Company tests its intangible assets for impairment at least annually (as of March 31st) and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others and without limitation: a significant decline in the Company’s expected future cash flows; a sustained, significant decline in the Company’s stock price and market capitalization; a significant adverse change in legal factors or in the business climate of the Company’s segments; unanticipated competition; and slower growth rates. As of June 30, 2022, the Company did not identify any indicators of impairment. Please also see Note 4 for further details on intangible assets. Research and Development Research and development expenditures are charged to expense as incurred. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Contingencies Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that it is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s condensed consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Where applicable, the Company records a valuation allowance to reduce any deferred tax assets that it determines will not be realizable in the future. The Company recognizes the benefit of an uncertain tax position that it has taken or expects to take on income tax returns it files if such tax position is more likely than not to be sustained on examination by the taxing authorities, based on the technical merits of the position. These tax benefits are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. The Company operates in multiple tax jurisdictions within the United States of America. The Company remains subject to examination in all tax jurisdiction until the applicable statutes of limitation expire. As of June 30, 2022, a summary of the tax years that remain subject to examination in our major tax jurisdictions are: United States – Federal, 2016 and forward, and State, 2013 and forward. The Company did not record unrecognized tax positions for the three months ended June 30, 2022 and June 30, 2021. Warrants and Preferred Shares The accounting treatment of warrants and preferred share series issued is determined pursuant to the guidance provided by ASC 470, Debt Distinguishing Liabilities from Equity Derivatives and Hedging Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation In accordance with the Company’s Director compensation policy and certain employment contracts, director’s fees and a portion of employee’s salaries are to be paid via the issuance of shares of the Company’s Common Stock (“Common Stock”), in lieu of cash, with the valuation of such share being calculated on a quarterly basis and equal to the average closing price of the Company’s Common Stock. Earnings Per Share Attributable to Common Shareholders’ The Company follows ASC 260, Earnings Per Share ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) The following is the computation of earnings per share applicable to common shareholders for the periods indicated: SCHEDULE OF EARNINGS (LOSS) PER SHARE APPLICABLE TO COMMON SHAREHOLDERS 2022 2021 For the Three Months Ended June 30, 2022 2021 Numerator Net income - basic $ 305,883 $ 2,389,118 Effect of dilutive instrument on net income — (614,461 ) Net income - diluted $ 305,883 $ 1,774,657 Denominator Weighted average shares of Common Stock outstanding - basic 1,011,381,988 1,009,199,886 Dilutive effect of stock options and convertible securities — — Weighted average shares of Common Stock outstanding - diluted 1,011,381,988 1,009,199,886 Net income per share Basic $ 0.00 $ 0.00 Diluted $ 0.00 $ 0.00 Fair Value of Financial Instruments ASC 820, Fair Value Measurements and Disclosures ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC 820 are described as follows: ● Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date. ● Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means. ● Level 3 – Inputs that are unobservable for the asset or liability. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Measured on a Recurring Basis The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell: SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS Fair Value Measurement Using Amount at Fair Value Level 1 Level 2 Level 3 Balance as of March 31, 2022 $ 936,837 - - $ 936,837 Change in fair value of derivative instruments 500,143 - - 500,143 Balance as of June 30, 2022 $ 1,436,980 $ — $ — $ 1,436,980 See Note 11, for specific inputs used in determining fair value. The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses, approximate their fair values because of the short maturity of these instruments. Based upon current borrowing rates with similar maturities the carrying value of long-term debt approximates fair value. Non-Financial Assets that are Measured at Fair Value on a Non-Recurring Basis Non-financial assets such as intangible assets, and property and equipment are measured at fair value only when an impairment loss is recognized. The Company did not record an impairment charge related to these assets in the periods presented. Treasury Stock The Company records treasury stock at the cost to acquire it and includes treasury stock as a component of shareholders’ equity. Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our consolidated financial statements and related disclosures. |
INVENTORY
INVENTORY | 3 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
INVENTORY | NOTE 2. INVENTORY Inventory consisted of the following: SCHEDULE OF INVENTORY June 30, 2022 March 31, 2022 Finished goods $ 397,061 $ 159,808 Work-in-progress 23,737 1,203,204 Raw materials 7,196,365 5,378,158 Inventory, net $ 7,617,163 $ 6,741,170 ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 3 Months Ended |
Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 3. PROPERTY AND EQUIPMENT, NET Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2022 March 31, 2022 Land, building and improvements $ 5,456,524 $ 5,456,524 Laboratory, manufacturing, warehouse and transportation equipment 13,112,328 13,017,731 Office equipment and software 373,601 373,601 Furniture and fixtures 453,701 453,701 Property plant and equipment, gross 19,396,154 19,301,557 Less: Accumulated depreciation (13,641,313 ) (13,348,565 ) Property plant and equipment, net $ 5,754,841 $ 5,952,992 Depreciation expense was $ 292,748 309,157 |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 3 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 4. INTANGIBLE ASSETS The following table summarizes the Company’s intangible assets: SCHEDULE OF INTANGIBLE ASSETS June 30, 2022 Estimated Gross Useful Carrying Accumulated Net Book Life Amount Additions Reductions Amortization Value Patent application costs * $ 465,684 $ — $ — $ — $ 465,684 ANDA acquisition costs Indefinite 6,168,351 — — — 6,168,351 $ 6,634,035 $ — $ — $ — $ 6,634,035 March 31, 2022 Estimated Gross Useful Carrying Accumulated Net Book Life Amount Additions Reductions Amortization Value Patent application costs * * $ 465,684 $ — $ — $ — $ 465,684 ANDA acquisition costs Indefinite 6,168,351 — — — 6,168,351 $ 6,634,035 $ — $ — $ — $ 6,634,035 * Patent application costs were incurred in relation to the Company’s abuse deterrent opioid technology. Amortization of the patent costs will begin upon the issuance of marketing authorization by the FDA. Amortization will then be calculated on a straight-line basis through the expiry of the related patent(s). ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
ACCRUED EXPENSES
ACCRUED EXPENSES | 3 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | NOTE 5. ACCRUED EXPENSES As of June 30, 2022 and March 31, 2022, the Company’s accrued expenses consisted of the following: SUMMARY OF ACCRUED EXPENSES June 30, 2022 March 31, 2022 Salaries and fees payable in common stock 3,750,000 3,625,000 Income tax 414,985 414,989 Consultant contract fees 153,333 153,333 Audit fees 140,000 140,000 Director dues 112,500 90,000 EWB loan interest 61,300 — Employee bonuses 56,250 143,000 Other accrued expenses 121,467 126,820 Total accrued expenses $ 4,809,835 $ 4,693,142 |
NJEDA BONDS
NJEDA BONDS | 3 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
NJEDA BONDS | NOTE 6. NJEDA BONDS In August, 2005, the Company issued NJEDA tax exempt Bonds with Series A Notes outstanding. The Company is required to maintain a debt service reserve. The debt service reserve is classified as restricted cash on the accompanying unaudited condensed consolidated balance sheets. The NJEDA Bonds require the Company to make an annual principal payment on September 1st based on the amount specified in the loan documents and semi-annual interest payments on March 1st and September 1st, equal to interest due on the outstanding principal. The annual interest rate on the Series A Note is 6.5 The following tables summarize the Company’s bonds payable liability: SCHEDULE OF BONDS PAYABLE LIABILITY June 30, 2022 March 31, 2022 Gross bonds payable NJEDA Bonds - Series A Notes $ 1,360,000 $ 1,360,000 Less: Current portion of bonds payable (prior to deduction of bond offering costs) (115,000 ) (115,000 ) Long-term portion of bonds payable (prior to deduction of bond offering costs) $ 1,245,000 $ 1,245,000 Bond offering costs $ 354,454 $ 354,454 Less: Accumulated amortization (238,670 ) (235,124 ) Bond offering costs, net $ 115,784 $ 119,330 Current portion of bonds payable - net of bond offering costs Current portions of bonds payable $ 115,000 $ 115,000 Less: Bonds offering costs to be amortized in the next 12 months (14,178 ) (14,178 ) Current portion of bonds payable, net of bond offering costs $ 100,822 $ 100,822 Long term portion of bonds payable - net of bond offering costs Long term portion of bonds payable 1,245,000 $ 1,245,000 Less: Bond offering costs to be amortized subsequent to the next 12 months (101,606 ) (105,152 ) Long term portion of bonds payable, net of bond offering costs $ 1,143,394 $ 1,139,848 Amortization expense was $ 3,546 3,545 29,467 7,367 ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
LOANS PAYABLE
LOANS PAYABLE | 3 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
LOANS PAYABLE | NOTE 7. LOANS PAYABLE On April 2, 2022, the Company and Elite Labs entered into a Loan and Security Agreement (the “EWB Loan Agreement”) with East West Bank (“EWB”). Pursuant to the EWB Loan Agreement, the Company and Elite Labs received one term loan for a principal amount of $ 12,000,000 2,000,000 6.48% 1.73 five years May 1, 2027 5.65% 0.87% May 1, 2027 40,120 The EWB Loan Agreement contains customary representations, warranties and covenants. These covenants include, but are not limited to, maintaining maximum leverage ratios of 3.50 to 1.00, minimum liquidity of $5,000,000, minimum cash of $1,000,000, a fixed charge coverage ratio of 1.25 to 1.00 and restrictions on mergers or sales of assets and debt borrowings Loans payable consisted of the following: SCHEDULE OF LOANS PAYABLE June 30, 2022 March 31, 2022 Equipment and insurance financing loans payable, between 3.30 12.02 $ 12,397,347 $ 502,052 Less: Current portion of loans payable (334,134 ) (253,006 ) Long-term portion of loans payable $ 12,063,213 $ 249,046 The interest expense associated with the loans payable was $ 177,579 6,109 |
DEFERRED REVENUE
DEFERRED REVENUE | 3 Months Ended |
Jun. 30, 2022 | |
Deferred Revenue | |
DEFERRED REVENUE | NOTE 8. DEFERRED REVENUE Deferred revenues in the aggregate amount of $ 42,222 13,333 28,889 45,559 13,333 32,226 These line items represent the unamortized amounts of a $ 200,000 September 2010 August 2025 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 9. COMMITMENTS AND CONTINGENCIES Operating Leases – 135 Ludlow Ave. The Company entered into an operating lease for a portion of a one-story warehouse, located at 135 Ludlow Avenue, Northvale, New Jersey (the “135 Ludlow Ave. lease”) which began in 2010. On June 30, 2021, the Company exercised a renewal option, with such option including a term that begins on January 1, 2022 and expires on December 31, 2026. The 135 Ludlow Ave. modified lease property required significant leasehold improvements and qualifications, as a prerequisite, for its intended future use. Manufacturing, packaging, warehousing and regulatory activities are currently conducted at this location. Additional renovations and construction to further expand the Company’s manufacturing resources are in progress. In October 2020, the Company entered into an operating lease for office space in Pompano Beach, Florida (the “Pompano Office Lease”). The Pompano Office Lease is for approximately 1,275 The Company assesses whether an arrangement is a lease or contains a lease at inception. For arrangements considered leases or that contain a lease that is accounted for separately, the Company determines the classification and initial measurement of the right-of-use asset and lease liability at the lease commencement date, which is the date that the underlying asset becomes available for use. The Company has elected to account for non-lease components associated with its leases and lease components as a single lease component. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) The Company recognizes a right-of-use asset, which represents the Company’s right to use the underlying asset for the lease term, and a lease liability, which represents the present value of the Company’s obligation to make payments arising over the lease term. The present value of the lease payments is calculated using either the implicit interest rate in the lease or an incremental borrowing rate. Rent expense is recorded on the straight-line basis. Rent expense under the leases for the three months ended June 30, 2022 and June 30, 2021 was $ 64,578 62,877 The table below shows the future minimum rental payments, exclusive of taxes, insurance and other costs, under the 135 Ludlow Ave. modified lease and the Pompano Office Lease: SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS Years ending March 31, Amount 2023 (excluding the three months ended June 30, 2022) 195,216 2024 254,050 2025 243,612 2026 248,484 Thereafter 189,144 Total future minimum lease payments 1,130,506 Less: interest (140,901 ) Present value of lease payments $ 989,605 The Company has an obligation for the restoration of its leased facility and the removal or dismantlement of certain property and equipment as a result of its business operation in accordance with ASC 410, Asset Retirement and Environmental Obligations – Asset Retirement Obligations 40,551 38,780 |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS – WARRANTS | 3 Months Ended |
Jun. 30, 2022 | |
Derivative Financial Instruments Warrants | |
DERIVATIVE FINANCIAL INSTRUMENTS – WARRANTS | NOTE 10. DERIVATIVE FINANCIAL INSTRUMENTS – WARRANTS The Company evaluates and accounts for its freestanding instruments in accordance with ASC 815, Accounting for Derivative Instruments and Hedging Activities The Company issued warrants, with a term of ten years, to affiliates in connection with an exchange agreement dated April 28, 2017, as further described in this note below. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) A summary of warrant activity is as follows: SCHEDULE OF WARRANT ACTIVITY June 30, 2022 March 31, 2022 Warrant Shares Weighted Average Exercise Price Warrant Shares Weighted Average Exercise Price Balance at beginning of period 79,008,661 $ 0.1521 79,008,661 $ 0.1521 Warrants granted pursuant to the issuance of Series J convertible preferred shares — — — — Warrants exercised, forfeited and/or expired, net — — — — Balance at end of period 79,008,661 $ 0.1521 79,008,661 $ 0.1521 On April 28, 2017, the Company entered into an Exchange Agreement with Nasrat Hakim (“Hakim”), the Chairman of the Board, President, and Chief Executive Officer of the Company, pursuant to which the Company issued to Hakim 24.0344 79,008,661 158,017,321 6,474,674 The Series J Warrants are exercisable for a period of 10 0.1521 The fair value of the Series J Warrants was calculated using a Black-Scholes model. The following assumptions were used in the Black-Scholes model to calculate the fair value of the Series J Warrants: SCHEDULE OF FAIR VALUE OF WARRANTS ISSUED June 30, 2022 March 31, 2022 Fair value of the Company’s Common Stock $ 0.0500 $ 0.0350 Volatility 72.42 % 76.55 % Initial exercise price $ 0.1521 $ 0.1521 Warrant term (in years) 4.8 5.1 Risk free rate 3.04 % 2.40 % The changes in warrants (Level 3 financial instruments) measured at fair value on a recurring basis for the three months ended June 30, 2022 were as follows: SCHEDULE OF CHANGES IN WARRANTS MEASURED AT FAIR VALUE ON A RECURRING BASIS Balance at March 31, 2022 $ 936,837 Change in fair value of derivative financial instruments - warrants 500,143 Balance at June 30, 2022 $ 1,436,980 ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
SHAREHOLDERS_ EQUITY
SHAREHOLDERS’ EQUITY | 3 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
SHAREHOLDERS’ EQUITY | NOTE 11. SHAREHOLDERS’ EQUITY Lincoln Park Capital Transaction - July 8, 2020 Purchase Agreement On July 8, 2020, the Company entered into a purchase agreement (the “2020 LPC Purchase Agreement”), and a registration rights agreement (the “2020 LPC Registration Rights Agreement”), with Lincoln Park Capital Fund, LLC (“Lincoln Park”), pursuant to which Lincoln Park has committed to purchase up to $ 25.0 0.001 The Company did not issue any shares of its Common Stock pursuant to the 2020 LPC Purchase Agreement during the three months ended June 30, 2022. In addition, there were no shares issued to Lincoln Park as additional commitment shares, pursuant to the 2020 LPC Agreement. As of June 30, 2022, the Company has issued an aggregate of 5,975,857 469,105 |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 3 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 12. STOCK-BASED COMPENSATION Part of the compensation paid by the Company to its Directors and employees consists of the issuance of Common Stock or via the granting of options to purchase Common Stock. Stock-based Director Compensation The Company’s Director compensation policy, instituted in October 2009 and further revised in January 2016, includes provisions that a portion of director’s fees are to be paid via the issuance of shares of the Company’s Common Stock, in lieu of cash, with the valuation of such shares being calculated on quarterly basis and equal to the average closing price of the Company’s Common Stock. As of June 30, 2022, the Company accrued director’s fees totaling $ 112,500 37,500 1,744,608 Stock-based Employee/Consultant Compensation Employment contracts with the Company’s President and Chief Executive Officer and certain other employees and engagement contracts with certain consultants include provisions for a portion of each employee’s salaries or consultant’s fees to be paid via the issuance of shares of the Company’s Common Stock, in lieu of cash, with the valuation of such shares being calculated on a quarterly basis and equal to the average closing price of the Company’s Common Stock. During the three months ended June 30, 2022, the Company accrued salaries totaling $ 193,750 2,274,102 As of June 30, 2022, the Company owed its President and Chief Executive Officer and certain other employees’ salaries totaling $ 3,750,000 53,107,446 ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Options Under its 2014 Stock Option Plan and prior options plans, the Company may grant stock options to officers, selected employees, as well as members of the Board of Directors and advisory board members. All options have generally been granted at a price equal to or greater than the fair market value of the Company’s Common Stock at the date of the grant. Generally, options are granted with a vesting period of up to three years and expire ten years from the date of grant. A summary of the activity of Company’s 2014 Stock Option Plan for the three months ended June 30, 2022 is as follows: SCHEDULE OF STOCK OPTION PLAN Shares Weighted Weighted Average Remaining Contractual Aggregate Intrinsic Value Outstanding at March 31, 2022 5,650,000 $ 0.14 2.8 $ — Granted 1,100,000 $ 0.04 10.0 $ 13,970 Outstanding at June 30, 2022 6,750,000 $ 0.14 2.8 $ — Exercisable at June 30, 2022 4,530,001 $ 0.16 2.3 $ — The aggregate intrinsic value for outstanding options is calculated as the difference between the exercise price of the underlying awards and the quoted price of the Company’s Common Stock as of June 30, 2022 and March 31, 2022 of $ 0.09 0.10 As of June 30, 2022, there was $ 44,330 2.8 |
CONCENTRATIONS AND CREDIT RISK
CONCENTRATIONS AND CREDIT RISK | 3 Months Ended |
Jun. 30, 2022 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS AND CREDIT RISK | NOTE 13. CONCENTRATIONS AND CREDIT RISK Revenues One customer accounted for approximately 85 One customer accounted for approximately 83 Accounts Receivable Two 90 80 10 Two 91 78 13 Purchasing Two 66 56 10 Two 52 38 14 |
SEGMENT RESULTS
SEGMENT RESULTS | 3 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT RESULTS | NOTE 14. SEGMENT RESULTS FASB ASC 280-10-50 requires use of the “management approach” model for segment reporting. The management approach is based on the way a company’s management organized segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. The Company has determined that its reportable segments are ANDAs for generic products and NDAs for branded products. The Company identified its reporting segments based on the marketing authorization relating to each and the financial information used by its chief operating decision maker to make decisions regarding the allocation of resources to and the financial performance of the reporting segments. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Asset information by operating segment is not presented below since the chief operating decision maker does not review this information by segment. The reporting segments follow the same accounting policies used in the preparation of the Company’s unaudited condensed consolidated financial statements. The following represents selected information for the Company’s reportable segments: SCHEDULE OF SELECTED INFORMATION FOR REPORTABLE SEGMENTS 2022 2021 For the Three Months Ended June 30, 2022 2021 Operating Income by Segment ANDA $ 2,252,145 $ 2,351,334 NDA — $ — Operating Income by Segment $ 2,252,145 $ 2,351,334 The table below reconciles the Company’s operating income by segment to income from operations before provision for income taxes as reported in the Company’s unaudited condensed consolidated statements of operations. SCHEDULE OF OPERATING LOSS BY SEGMENT TO (LOSS) INCOME FROM OPERATIONS 2022 2021 For the Three Months Ended June 30, 2022 2021 Operating income by segment $ 2,252,145 $ 2,351,334 Corporate unallocated costs (716,872 ) (851,856 ) Interest income 129 42 Interest expense and amortization of debt issuance costs (216,787 ) (45,893 ) Depreciation and amortization expense (296,294 ) (312,702 ) Significant non-cash items (216,295 ) (221,618 ) Change in fair value of derivative instruments (500,143 ) 614,461 Income from operations before income taxes $ 305,883 $ 1,533,768 |
RELATED PARTY AGREEMENTS WITH M
RELATED PARTY AGREEMENTS WITH MIKAH PHARMA, LLC | 3 Months Ended |
Jun. 30, 2022 | |
Related Party Agreements With Mikah Pharma Llc | |
RELATED PARTY AGREEMENTS WITH MIKAH PHARMA, LLC | NOTE 15. RELATED PARTY AGREEMENTS WITH MIKAH PHARMA, LLC On December 3, 2018, the Company executed a development agreement with Mikah Pharma, LLC (“Mikah”), pursuant to which Mikah and the Company will collaborate to develop and commercialize generic products including formulation development, analytical method development, bioequivalence studies and manufacture of development batches of generic products. Mikah was founded in 2009 by Hakim, a related party and the Company’s President, Chief Executive Officer and Chairman of the Board. As of March 31, 2021, the Company has incurred costs which are $ 238,451 In May 2020, SunGen Pharma LLC (“SunGen”), pursuant to an asset purchase agreement, assigned its rights and obligations under the SunGen Agreement for Amphetamine IR and Amphetamine ER to Mikah Pharmaceuticals. The ANDAs for Amphetamine IR and Amphetamine ER are now registered under Elite’s name. Mikah will now be Elite’s partner with respect to Amphetamine IR and ER and will assume all the rights and obligations for these products from SunGen. Mikah Pharmaceuticals was founded in 2009 by Nasrat Hakim, a related party and the Company’s President, Chief Executive Officer and Chairman of the Board. In June 2021, the Company entered into a development and license agreement with Mikah Pharma LLC, pursuant to which Mikah Pharma LLC will engage in the research, development, sales and licensing of generic pharmaceutical products. In addition, Mikah Pharma LLC will collaborate to develop and commercialize generic products including formulation development, analytical method development, manufacturing, sales and marketing of generic products. Initially two generic products were identified for the parties to develop. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 16. INCOME TAXES The Company’s effective tax rate and income tax expense for the three months ended June 30, 2022 was $ 0 21 |
COVID-19 UPDATE
COVID-19 UPDATE | 3 Months Ended |
Jun. 30, 2022 | |
Unusual or Infrequent Items, or Both [Abstract] | |
COVID-19 UPDATE | NOTE 17. COVID-19 UPDATE In December 2019, the Novel Corona Virus, COVID-19 was reported to have emerged in Wuhan, China. In March 2020, the World Health Organization (“WHO”) declared the COVID-19 outbreak a global pandemic. Governments at the national, state and local level in the United States, and globally, have implemented aggressive actions to reduce the spread of the virus, with such actions including, without limitation, lockdown and shelter in place orders, limitations on non-essential gatherings of people, suspension of all non-essential travel, and ordering certain businesses and governmental agencies to cease non-essential operations at physical locations. Under current and applicable laws and regulations, the Company’s business is deemed essential and it has continued to operate in all aspects of its pharmaceutical manufacturing, distribution, product development, regulatory compliance and other activities. The Company’s management has developed and implemented a range of measures to address the risks, uncertainties, and operational challenges associated with operating in a COVID-19 environment. The Company is closely monitoring the rapidly evolving and changing situation and are implementing plans intended to limit the impact of COVID-19 on our business so that the Company can continue to manufacture those medicines used by end user patients. Actions the Company has taken to date are, without limitation, further described below. Workforce The Company has taken and will continue to take, proactive measures to provide for the well-being of its workforce while continuing to safely produce pharmaceutical products. The Company has implemented alternative working practices, which include, without limitation, modified schedules, shift rotation and work at home abilities for appropriate employees to best ensure adequate social distancing. In addition, the Company increased its already thorough cleaning protocols throughout its facilities and has prohibited visits from non-essential visitors. Certain of these measures have resulted in increased costs. Manufacturing and Supply Chain During the three months ended June 30, 2022, and as of the date of this Quarterly Report on Form 10-Q, the Company has not experienced material, detrimental issues related to COVID-19 in its manufacturing, supply chain, quality assurance and regulatory compliance activities, and has been able to operate without interruption. The Company has taken, and plans to continue to take, commercially practical measures to keep its facilities open. The Company’s supply chains remain intact and operational, and the Company is in regular communications with its suppliers and third-party partners. A prolonging of the current situation relating to COVID-19 may result in an increased risk of interruption in the Company supply chain in the future, with no assurances given as the materiality of such future interruption on the Company’s business, financial condition, results of operations and cash flows. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 18. SUBSEQUENT EVENTS On April 8, 2022, the Company entered into an Agreement for Sale and Purchase of Real Estate to purchase the building located at 135-137 Ludlow Avenue in Northvale, NJ. The Company had leased the entire 35,000 square feet of floor space since 2014. This property is occupied by the Company’s Quality Assurance department, commercial manufacturing, packaging, and warehouse. The closing of the Agreement for Sale and Purchase of Real Estate occurred on July 1, 2022. On July 1, 2022, the EWB provided a mortgage loan in the amount of $ 2.55 10 years bears interest at a rate of 4.75% fixed for 5 years then adjustable at WSJP plus 0.5% with floor rate of 4.5% |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Elite Labs. All significant intercompany accounts and transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements reflect all adjustments, consisting of normal recurring items, which are, in the opinion of management, necessary for a fair presentation of such statements. The results of operations for the three months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the entire year. |
Segment Information | Segment Information Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 280 (“ASC 280”), Segment Reporting The Company’s chief operating decision maker is the Chief Executive Officer, who reviews the financial performance and the results of operations of the segments prepared in accordance with GAAP when making decisions about allocating resources and assessing performance of the Company. The Company has determined that its reportable segments are products whose marketing approvals were secured via an Abbreviated New Drug Applications (“ANDA”) and products whose marketing approvals were secured via a New Drug Application (“NDA”). ANDA products are referred to as generic pharmaceuticals and NDA products are referred to as branded pharmaceuticals. There are currently no intersegment revenues. Asset information by operating segment is not presented below since the chief operating decision maker does not review this information by segment. The reporting segments follow the same accounting policies used in the preparation of the Company’s condensed unaudited consolidated financial statements. Please see Note 15 for further details. |
Revenue Recognition | Revenue Recognition The Company generates revenue primarily from manufacturing and licensing fees. Manufacturing fees include the development of pain management products, manufacturing of a line of generic pharmaceutical products with approved ANDA, through the manufacture of formulations and the development of new products. Licensing fees include the commercialization of products either by license and the collection of royalties, or the expansion of licensing agreements with other pharmaceutical companies, including co-development projects, joint ventures and other collaborations. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Under ASC 606, Revenue from Contacts with Customers |
Nature of goods and services | Nature of goods and services The following is a description of the Company’s goods and services from which the Company generates revenue, as well as the nature, timing of satisfaction of performance obligations, and significant payment terms for each, as applicable: a) Manufacturing Fees The Company is equipped to manufacture controlled-release products on a contract basis for third parties, if, and when, the products are approved. These products include products using controlled-release drug technology. The Company also develops and markets (either on its own or by license to other companies) generic and proprietary controlled-release pharmaceutical products. The Company recognizes revenue when the customer obtains control of the Company’s product based on the contractual shipping terms of the contract. The Company is primarily responsible for fulfilling the promise to provide the product, is responsible to ensure that the product is produced in accordance with the related supply agreement and bears risk of loss while the inventory is in-transit to the commercial partner. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring products to a customer. b) License Fees The Company enters into licensing and development agreements, which may include multiple revenue generating activities, including milestones payments, licensing fees, product sales and services. The Company analyzes each element of its licensing and development agreements in accordance with ASC 606 to determine appropriate revenue recognition. The terms of the license agreement may include payment to the Company of licensing fees, non-refundable upfront license fees, milestone payments if specified objectives are achieved, and/or royalties on product sales. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price based on the estimated relative standalone selling prices of the promised products or services underlying each performance obligation. The Company determines standalone selling prices based on the price at which the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the Company estimates the standalone selling price taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. The Company recognizes revenue from non-refundable upfront payments at a point in time, typically upon fulfilling the delivery of the associated intellectual property to the customer. For those milestone payments which are contingent on the occurrence of particular future events (for example, payments due upon a product receiving FDA approval), the Company determined that these need to be considered for inclusion in the calculation of total consideration from the contract as a component of variable consideration using the most-likely amount method. As such, the Company assesses each milestone to determine the probability and substance behind achieving each milestone. Given the inherent uncertainty of the occurrence of future events, the Company will recognize revenue from the milestone when there is not a high probability of a reversal of revenue, which typically occurs near or upon achievement of the event. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Significant management judgment is required to determine the level of effort required under an arrangement and the period over which the Company expects to complete its performance obligations under the arrangement. If the Company cannot reasonably estimate when its performance obligations either are completed or become inconsequential, then revenue recognition is deferred until the Company can reasonably make such estimates. Revenue is then recognized over the remaining estimated period of performance using the cumulative catch-up method. When determining the transaction price of a contract, an adjustment is made if payment from a customer occurs either significantly before or significantly after performance, resulting in a significant financing component. Applying the practical expedient in ASC 606-10-32-18, the Company does not assess whether a significant financing component exists if the period between when the Company performs its obligations under the contract and when the customer pays is one year or less. None of the Company’s contracts contained a significant financing component as of June 30, 2022. In accordance with ASC 606-10-55-65, royalties are recognized when the subsequent sale of the customer’s products occurs. The Company entered into a sales and distribution licensing agreement with Epic Pharma LLC, (“Epic”) dated June 4, 2015 (the “2015 Epic License Agreement”), which has been determined to satisfy the criteria for consideration as a collaborative agreement, and is accounted for accordingly. The 2015 Epic License Agreement expired on June 4, 2020 without renewal. The Company entered into a Master Development and License Agreement with SunGen Pharma LLC dated August 24, 2016 (the “SunGen Agreement”), which has been determined to satisfy the criteria for consideration as a collaborative agreement, and is accounted for accordingly. On April 3, 2020, Elite and SunGen mutually agreed to discontinue any further joint product development activities. |
Disaggregation of revenue | Disaggregation of revenue In the following table, revenue is disaggregated by type of revenue generated by the Company. The table also includes a reconciliation of the disaggregated revenue with the reportable segments: SCHEDULE OF DISAGGREGATION OF REVENUE For the Three Months Ended June 30, 2022 2021 NDA: Licensing fees $ — $ — Manufacturing fees $ 6,327,141 $ 5,750,036 Total NDA revenue — — ANDA: Manufacturing fees $ 6,327,141 $ 5,750,036 Licensing fees 1,345,767 1,306,753 Total ANDA revenue 7,672,908 7,056,789 Total revenue $ 7,672,908 $ 7,056,789 |
Cash | Cash The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks and money market instruments. The Company places its cash and cash equivalents with high-quality, U.S. financial institutions and, to date has not experienced losses on any of its balances. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
Restricted Cash | Restricted Cash As of June 30, 2022, and March 31, 2022, the Company had $ 405,163 405,039 |
Accounts Receivable | Accounts Receivable Accounts receivable are comprised of balances due from customers, net of estimated allowances for uncollectible accounts. In determining collectability, historical trends are evaluated, and specific customer issues are reviewed on a periodic basis to arrive at appropriate allowances. |
Inventory | Inventory Inventory is recorded at the lower of cost or net realizable value on specific identification by lot number basis. |
Long-Lived Assets | Long-Lived Assets The Company periodically evaluates the fair value of long-lived assets, which include property and equipment and intangibles, whenever events or changes in circumstances indicate that its carrying amounts may not be recoverable. Property and equipment are stated at cost. Depreciation is provided on the straight-line method based on the estimated useful lives of the respective assets which range from three forty years Upon retirement or other disposition of assets, the cost and related accumulated depreciation are removed from the accounts and the resulting gain or loss, if any, is recognized in income. |
Intangible Assets | Intangible Assets The Company capitalizes certain costs to acquire intangible assets; if such assets are determined to have a finite useful life they are amortized on a straight-line basis over the estimated useful life. Costs to acquire indefinite lived intangible assets, such as costs related to ANDAs are capitalized accordingly. The Company tests its intangible assets for impairment at least annually (as of March 31st) and whenever events or circumstances change that indicate impairment may have occurred. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. Such indicators may include, among others and without limitation: a significant decline in the Company’s expected future cash flows; a sustained, significant decline in the Company’s stock price and market capitalization; a significant adverse change in legal factors or in the business climate of the Company’s segments; unanticipated competition; and slower growth rates. As of June 30, 2022, the Company did not identify any indicators of impairment. Please also see Note 4 for further details on intangible assets. |
Research and Development | Research and Development Research and development expenditures are charged to expense as incurred. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) |
Contingencies | Contingencies Occasionally, the Company may be involved in claims and legal proceedings arising from the ordinary course of its business. The Company records a provision for a liability when it believes that it is both probable that a liability has been incurred, and the amount can be reasonably estimated. If these estimates and assumptions change or prove to be incorrect, it could have a material impact on the Company’s condensed consolidated financial statements. Contingencies are inherently unpredictable, and the assessments of the value can involve a series of complex judgments about future events and can rely heavily on estimates and assumptions. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. Where applicable, the Company records a valuation allowance to reduce any deferred tax assets that it determines will not be realizable in the future. The Company recognizes the benefit of an uncertain tax position that it has taken or expects to take on income tax returns it files if such tax position is more likely than not to be sustained on examination by the taxing authorities, based on the technical merits of the position. These tax benefits are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. The Company operates in multiple tax jurisdictions within the United States of America. The Company remains subject to examination in all tax jurisdiction until the applicable statutes of limitation expire. As of June 30, 2022, a summary of the tax years that remain subject to examination in our major tax jurisdictions are: United States – Federal, 2016 and forward, and State, 2013 and forward. The Company did not record unrecognized tax positions for the three months ended June 30, 2022 and June 30, 2021. |
Warrants and Preferred Shares | Warrants and Preferred Shares The accounting treatment of warrants and preferred share series issued is determined pursuant to the guidance provided by ASC 470, Debt Distinguishing Liabilities from Equity Derivatives and Hedging |
Stock-Based Compensation | Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718, Compensation-Stock Compensation In accordance with the Company’s Director compensation policy and certain employment contracts, director’s fees and a portion of employee’s salaries are to be paid via the issuance of shares of the Company’s Common Stock (“Common Stock”), in lieu of cash, with the valuation of such share being calculated on a quarterly basis and equal to the average closing price of the Company’s Common Stock. |
Earnings Per Share Attributable to Common Shareholders’ | Earnings Per Share Attributable to Common Shareholders’ The Company follows ASC 260, Earnings Per Share ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) The following is the computation of earnings per share applicable to common shareholders for the periods indicated: SCHEDULE OF EARNINGS (LOSS) PER SHARE APPLICABLE TO COMMON SHAREHOLDERS 2022 2021 For the Three Months Ended June 30, 2022 2021 Numerator Net income - basic $ 305,883 $ 2,389,118 Effect of dilutive instrument on net income — (614,461 ) Net income - diluted $ 305,883 $ 1,774,657 Denominator Weighted average shares of Common Stock outstanding - basic 1,011,381,988 1,009,199,886 Dilutive effect of stock options and convertible securities — — Weighted average shares of Common Stock outstanding - diluted 1,011,381,988 1,009,199,886 Net income per share Basic $ 0.00 $ 0.00 Diluted $ 0.00 $ 0.00 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC 820, Fair Value Measurements and Disclosures ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy under ASC 820 are described as follows: ● Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that are accessible at the measurement date. ● Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means. ● Level 3 – Inputs that are unobservable for the asset or liability. ELITE PHARMACEUTICALS, INC. AND SUBSIDIARY NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) Measured on a Recurring Basis The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell: SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS Fair Value Measurement Using Amount at Fair Value Level 1 Level 2 Level 3 Balance as of March 31, 2022 $ 936,837 - - $ 936,837 Change in fair value of derivative instruments 500,143 - - 500,143 Balance as of June 30, 2022 $ 1,436,980 $ — $ — $ 1,436,980 See Note 11, for specific inputs used in determining fair value. The carrying amounts of the Company’s financial assets and liabilities, such as cash, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses, approximate their fair values because of the short maturity of these instruments. Based upon current borrowing rates with similar maturities the carrying value of long-term debt approximates fair value. Non-Financial Assets that are Measured at Fair Value on a Non-Recurring Basis Non-financial assets such as intangible assets, and property and equipment are measured at fair value only when an impairment loss is recognized. The Company did not record an impairment charge related to these assets in the periods presented. |
Treasury Stock | Treasury Stock The Company records treasury stock at the cost to acquire it and includes treasury stock as a component of shareholders’ equity. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments Management has evaluated other recently issued accounting pronouncements and does not believe that any of these pronouncements will have a significant impact on our consolidated financial statements and related disclosures. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
SCHEDULE OF DISAGGREGATION OF REVENUE | In the following table, revenue is disaggregated by type of revenue generated by the Company. The table also includes a reconciliation of the disaggregated revenue with the reportable segments: SCHEDULE OF DISAGGREGATION OF REVENUE For the Three Months Ended June 30, 2022 2021 NDA: Licensing fees $ — $ — Manufacturing fees $ 6,327,141 $ 5,750,036 Total NDA revenue — — ANDA: Manufacturing fees $ 6,327,141 $ 5,750,036 Licensing fees 1,345,767 1,306,753 Total ANDA revenue 7,672,908 7,056,789 Total revenue $ 7,672,908 $ 7,056,789 |
SCHEDULE OF EARNINGS (LOSS) PER SHARE APPLICABLE TO COMMON SHAREHOLDERS | The following is the computation of earnings per share applicable to common shareholders for the periods indicated: SCHEDULE OF EARNINGS (LOSS) PER SHARE APPLICABLE TO COMMON SHAREHOLDERS 2022 2021 For the Three Months Ended June 30, 2022 2021 Numerator Net income - basic $ 305,883 $ 2,389,118 Effect of dilutive instrument on net income — (614,461 ) Net income - diluted $ 305,883 $ 1,774,657 Denominator Weighted average shares of Common Stock outstanding - basic 1,011,381,988 1,009,199,886 Dilutive effect of stock options and convertible securities — — Weighted average shares of Common Stock outstanding - diluted 1,011,381,988 1,009,199,886 Net income per share Basic $ 0.00 $ 0.00 Diluted $ 0.00 $ 0.00 |
SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS | The following table presents information about our liabilities measured at fair value on a recurring basis, aggregated by the level in the fair value hierarchy within which those measurements fell: SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS Fair Value Measurement Using Amount at Fair Value Level 1 Level 2 Level 3 Balance as of March 31, 2022 $ 936,837 - - $ 936,837 Change in fair value of derivative instruments 500,143 - - 500,143 Balance as of June 30, 2022 $ 1,436,980 $ — $ — $ 1,436,980 |
INVENTORY (Tables)
INVENTORY (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Inventory Disclosure [Abstract] | |
SCHEDULE OF INVENTORY | Inventory consisted of the following: SCHEDULE OF INVENTORY June 30, 2022 March 31, 2022 Finished goods $ 397,061 $ 159,808 Work-in-progress 23,737 1,203,204 Raw materials 7,196,365 5,378,158 Inventory, net $ 7,617,163 $ 6,741,170 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT June 30, 2022 March 31, 2022 Land, building and improvements $ 5,456,524 $ 5,456,524 Laboratory, manufacturing, warehouse and transportation equipment 13,112,328 13,017,731 Office equipment and software 373,601 373,601 Furniture and fixtures 453,701 453,701 Property plant and equipment, gross 19,396,154 19,301,557 Less: Accumulated depreciation (13,641,313 ) (13,348,565 ) Property plant and equipment, net $ 5,754,841 $ 5,952,992 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF INTANGIBLE ASSETS | The following table summarizes the Company’s intangible assets: SCHEDULE OF INTANGIBLE ASSETS June 30, 2022 Estimated Gross Useful Carrying Accumulated Net Book Life Amount Additions Reductions Amortization Value Patent application costs * $ 465,684 $ — $ — $ — $ 465,684 ANDA acquisition costs Indefinite 6,168,351 — — — 6,168,351 $ 6,634,035 $ — $ — $ — $ 6,634,035 March 31, 2022 Estimated Gross Useful Carrying Accumulated Net Book Life Amount Additions Reductions Amortization Value Patent application costs * * $ 465,684 $ — $ — $ — $ 465,684 ANDA acquisition costs Indefinite 6,168,351 — — — 6,168,351 $ 6,634,035 $ — $ — $ — $ 6,634,035 * Patent application costs were incurred in relation to the Company’s abuse deterrent opioid technology. Amortization of the patent costs will begin upon the issuance of marketing authorization by the FDA. Amortization will then be calculated on a straight-line basis through the expiry of the related patent(s). |
ACCRUED EXPENSES (Tables)
ACCRUED EXPENSES (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
SUMMARY OF ACCRUED EXPENSES | As of June 30, 2022 and March 31, 2022, the Company’s accrued expenses consisted of the following: SUMMARY OF ACCRUED EXPENSES June 30, 2022 March 31, 2022 Salaries and fees payable in common stock 3,750,000 3,625,000 Income tax 414,985 414,989 Consultant contract fees 153,333 153,333 Audit fees 140,000 140,000 Director dues 112,500 90,000 EWB loan interest 61,300 — Employee bonuses 56,250 143,000 Other accrued expenses 121,467 126,820 Total accrued expenses $ 4,809,835 $ 4,693,142 |
NJEDA BONDS (Tables)
NJEDA BONDS (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF BONDS PAYABLE LIABILITY | The following tables summarize the Company’s bonds payable liability: SCHEDULE OF BONDS PAYABLE LIABILITY June 30, 2022 March 31, 2022 Gross bonds payable NJEDA Bonds - Series A Notes $ 1,360,000 $ 1,360,000 Less: Current portion of bonds payable (prior to deduction of bond offering costs) (115,000 ) (115,000 ) Long-term portion of bonds payable (prior to deduction of bond offering costs) $ 1,245,000 $ 1,245,000 Bond offering costs $ 354,454 $ 354,454 Less: Accumulated amortization (238,670 ) (235,124 ) Bond offering costs, net $ 115,784 $ 119,330 Current portion of bonds payable - net of bond offering costs Current portions of bonds payable $ 115,000 $ 115,000 Less: Bonds offering costs to be amortized in the next 12 months (14,178 ) (14,178 ) Current portion of bonds payable, net of bond offering costs $ 100,822 $ 100,822 Long term portion of bonds payable - net of bond offering costs Long term portion of bonds payable 1,245,000 $ 1,245,000 Less: Bond offering costs to be amortized subsequent to the next 12 months (101,606 ) (105,152 ) Long term portion of bonds payable, net of bond offering costs $ 1,143,394 $ 1,139,848 |
LOANS PAYABLE (Tables)
LOANS PAYABLE (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
SCHEDULE OF LOANS PAYABLE | Loans payable consisted of the following: SCHEDULE OF LOANS PAYABLE June 30, 2022 March 31, 2022 Equipment and insurance financing loans payable, between 3.30 12.02 $ 12,397,347 $ 502,052 Less: Current portion of loans payable (334,134 ) (253,006 ) Long-term portion of loans payable $ 12,063,213 $ 249,046 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS | The table below shows the future minimum rental payments, exclusive of taxes, insurance and other costs, under the 135 Ludlow Ave. modified lease and the Pompano Office Lease: SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS Years ending March 31, Amount 2023 (excluding the three months ended June 30, 2022) 195,216 2024 254,050 2025 243,612 2026 248,484 Thereafter 189,144 Total future minimum lease payments 1,130,506 Less: interest (140,901 ) Present value of lease payments $ 989,605 |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS – WARRANTS (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Derivative Financial Instruments Warrants | |
SCHEDULE OF WARRANT ACTIVITY | A summary of warrant activity is as follows: SCHEDULE OF WARRANT ACTIVITY June 30, 2022 March 31, 2022 Warrant Shares Weighted Average Exercise Price Warrant Shares Weighted Average Exercise Price Balance at beginning of period 79,008,661 $ 0.1521 79,008,661 $ 0.1521 Warrants granted pursuant to the issuance of Series J convertible preferred shares — — — — Warrants exercised, forfeited and/or expired, net — — — — Balance at end of period 79,008,661 $ 0.1521 79,008,661 $ 0.1521 |
SCHEDULE OF FAIR VALUE OF WARRANTS ISSUED | The fair value of the Series J Warrants was calculated using a Black-Scholes model. The following assumptions were used in the Black-Scholes model to calculate the fair value of the Series J Warrants: SCHEDULE OF FAIR VALUE OF WARRANTS ISSUED June 30, 2022 March 31, 2022 Fair value of the Company’s Common Stock $ 0.0500 $ 0.0350 Volatility 72.42 % 76.55 % Initial exercise price $ 0.1521 $ 0.1521 Warrant term (in years) 4.8 5.1 Risk free rate 3.04 % 2.40 % |
SCHEDULE OF CHANGES IN WARRANTS MEASURED AT FAIR VALUE ON A RECURRING BASIS | The changes in warrants (Level 3 financial instruments) measured at fair value on a recurring basis for the three months ended June 30, 2022 were as follows: SCHEDULE OF CHANGES IN WARRANTS MEASURED AT FAIR VALUE ON A RECURRING BASIS Balance at March 31, 2022 $ 936,837 Change in fair value of derivative financial instruments - warrants 500,143 Balance at June 30, 2022 $ 1,436,980 |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
SCHEDULE OF STOCK OPTION PLAN | SCHEDULE OF STOCK OPTION PLAN Shares Weighted Weighted Average Remaining Contractual Aggregate Intrinsic Value Outstanding at March 31, 2022 5,650,000 $ 0.14 2.8 $ — Granted 1,100,000 $ 0.04 10.0 $ 13,970 Outstanding at June 30, 2022 6,750,000 $ 0.14 2.8 $ — Exercisable at June 30, 2022 4,530,001 $ 0.16 2.3 $ — |
SEGMENT RESULTS (Tables)
SEGMENT RESULTS (Tables) | 3 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
SCHEDULE OF SELECTED INFORMATION FOR REPORTABLE SEGMENTS | The following represents selected information for the Company’s reportable segments: SCHEDULE OF SELECTED INFORMATION FOR REPORTABLE SEGMENTS 2022 2021 For the Three Months Ended June 30, 2022 2021 Operating Income by Segment ANDA $ 2,252,145 $ 2,351,334 NDA — $ — Operating Income by Segment $ 2,252,145 $ 2,351,334 |
SCHEDULE OF OPERATING LOSS BY SEGMENT TO (LOSS) INCOME FROM OPERATIONS | The table below reconciles the Company’s operating income by segment to income from operations before provision for income taxes as reported in the Company’s unaudited condensed consolidated statements of operations. SCHEDULE OF OPERATING LOSS BY SEGMENT TO (LOSS) INCOME FROM OPERATIONS 2022 2021 For the Three Months Ended June 30, 2022 2021 Operating income by segment $ 2,252,145 $ 2,351,334 Corporate unallocated costs (716,872 ) (851,856 ) Interest income 129 42 Interest expense and amortization of debt issuance costs (216,787 ) (45,893 ) Depreciation and amortization expense (296,294 ) (312,702 ) Significant non-cash items (216,295 ) (221,618 ) Change in fair value of derivative instruments (500,143 ) 614,461 Income from operations before income taxes $ 305,883 $ 1,533,768 |
SCHEDULE OF DISAGGREGATION OF R
SCHEDULE OF DISAGGREGATION OF REVENUE (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Licensing fees | $ 1,345,767 | $ 1,306,753 |
Manufacturing fees | 6,327,141 | 5,750,036 |
Total revenue | 7,672,908 | 7,056,789 |
New Drug Applications [Member] | ||
Licensing fees | ||
Total revenue | ||
Abbreviated New Drug Applications [Member] | ||
Licensing fees | 1,345,767 | 1,306,753 |
Manufacturing fees | 6,327,141 | 5,750,036 |
Total revenue | $ 7,672,908 | $ 7,056,789 |
SCHEDULE OF EARNINGS (LOSS) PER
SCHEDULE OF EARNINGS (LOSS) PER SHARE APPLICABLE TO COMMON SHAREHOLDERS (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Accounting Policies [Abstract] | ||
Net income - basic | $ 305,883 | $ 2,389,118 |
Effect of dilutive instrument on net income | (614,461) | |
Net income - diluted | $ 305,883 | $ 1,774,657 |
Weighted average shares of Common Stock outstanding - basic | 1,011,381,988 | 1,009,199,886 |
Dilutive effect of stock options and convertible securities | ||
Weighted average shares of Common Stock outstanding - diluted | 1,011,381,988 | 1,009,199,886 |
Basic | $ 0 | $ 0 |
Diluted | $ 0 | $ 0 |
SCHEDULE OF LIABILITIES MEASURE
SCHEDULE OF LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Derivative liabilities, beginning balance | $ 936,837 | |
Change in fair value of derivative instruments | 500,143 | $ (614,461) |
Derivative liabilities, ending balance | 1,436,980 | |
Fair Value, Inputs, Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Derivative liabilities, beginning balance | ||
Change in fair value of derivative instruments | ||
Derivative liabilities, ending balance | ||
Fair Value, Inputs, Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Derivative liabilities, beginning balance | ||
Change in fair value of derivative instruments | ||
Derivative liabilities, ending balance | ||
Fair Value, Inputs, Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Derivative liabilities, beginning balance | 936,837 | |
Change in fair value of derivative instruments | 500,143 | |
Derivative liabilities, ending balance | $ 1,436,980 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Mar. 31, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Restricted cash | $ 405,163 | $ 405,039 |
Description of tax benefits | These tax benefits are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. | |
Minimum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 3 years | |
Maximum [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful life | 40 years |
SCHEDULE OF INVENTORY (Details)
SCHEDULE OF INVENTORY (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Finished goods | $ 397,061 | $ 159,808 |
Work-in-progress | 23,737 | 1,203,204 |
Raw materials | 7,196,365 | 5,378,158 |
Inventory, net | $ 7,617,163 | $ 6,741,170 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 19,396,154 | $ 19,301,557 |
Less: Accumulated depreciation | (13,641,313) | (13,348,565) |
Property plant and equipment, net | 5,754,841 | 5,952,992 |
Land, Buildings and Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 5,456,524 | 5,456,524 |
Laboratory Manufacturing Warehouse And Transportation Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 13,112,328 | 13,017,731 |
Office Equipment And Software [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 373,601 | 373,601 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 453,701 | $ 453,701 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 292,748 | $ 309,157 |
SCHEDULE OF INTANGIBLE ASSETS (
SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Mar. 31, 2022 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 6,634,035 | $ 6,634,035 | |
Additions | |||
Reductions | |||
Accumulated Amortization | 0 | 0 | |
Net Book Value | $ 6,634,035 | $ 6,634,035 | |
Patent Application Costs [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated Useful Life | [1] | * | * |
Gross Carrying Amount | $ 465,684 | $ 465,684 | |
Additions | |||
Reductions | |||
Accumulated Amortization | 0 | 0 | |
Net Book Value | $ 465,684 | $ 465,684 | |
ANDA Acquisition Costs [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Estimated Useful Life | Indefinite | Indefinite | |
Gross Carrying Amount | $ 6,168,351 | $ 6,168,351 | |
Additions | |||
Reductions | |||
Accumulated Amortization | 0 | 0 | |
Net Book Value | $ 6,168,351 | $ 6,168,351 | |
[1]Patent application costs were incurred in relation to the Company’s abuse deterrent opioid technology. Amortization of the patent costs will begin upon the issuance of marketing authorization by the FDA. Amortization will then be calculated on a straight-line basis through the expiry of the related patent(s). |
SUMMARY OF ACCRUED EXPENSES (De
SUMMARY OF ACCRUED EXPENSES (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Payables and Accruals [Abstract] | ||
Salaries and fees payable in common stock | $ 3,750,000 | $ 3,625,000 |
Income tax | 414,985 | 414,989 |
Consultant contract fees | 153,333 | 153,333 |
Audit fees | 140,000 | 140,000 |
Director dues | 112,500 | 90,000 |
EWB loan interest | 61,300 | |
Employee bonuses | 56,250 | 143,000 |
Other accrued expenses | 121,467 | 126,820 |
Total accrued expenses | $ 4,809,835 | $ 4,693,142 |
SCHEDULE OF BONDS PAYABLE LIABI
SCHEDULE OF BONDS PAYABLE LIABILITY (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Debt Instrument [Line Items] | ||
Less: Bonds offering costs to be amortized in the next 12 months | $ (100,822) | $ (100,822) |
Less: Bond offering costs to be amortized subsequent to the next 12 months | (1,143,394) | (1,139,848) |
Njeda Bonds Series A Notes [Member] | ||
Debt Instrument [Line Items] | ||
NJEDA Bonds - Series A Notes | 1,360,000 | 1,360,000 |
Less: Current portion of bonds payable (prior to deduction of bond offering costs) | (115,000) | (115,000) |
Long-term portion of bonds payable (prior to deduction of bond offering costs) | 1,245,000 | 1,245,000 |
Bond offering costs | 354,454 | 354,454 |
Less: Accumulated amortization | (238,670) | (235,124) |
Bond offering costs, net | 115,784 | 119,330 |
Njeda Bonds Current [Member] | ||
Debt Instrument [Line Items] | ||
Current portions of bonds payable | 115,000 | 115,000 |
Less: Bonds offering costs to be amortized in the next 12 months | (14,178) | (14,178) |
Current portion of bonds payable, net of bond offering costs | 100,822 | 100,822 |
Njeda Bonds Noncurrent [Member] | ||
Debt Instrument [Line Items] | ||
Long term portion of bonds payable | 1,245,000 | 1,245,000 |
Less: Bond offering costs to be amortized subsequent to the next 12 months | (101,606) | (105,152) |
Long term portion of bonds payable, net of bond offering costs | $ 1,143,394 | $ 1,139,848 |
NJEDA BONDS (Details Narrative)
NJEDA BONDS (Details Narrative) - USD ($) | 3 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | |
Debt Instrument [Line Items] | |||
Interest payable | $ 29,467 | $ 7,367 | |
NJEDA Bonds [Member] | |||
Debt Instrument [Line Items] | |||
Amortization expense | $ 3,546 | $ 3,545 | |
Njeda Bonds Series A Notes [Member] | |||
Debt Instrument [Line Items] | |||
Annual interest rate | 6.50% |
SCHEDULE OF LOANS PAYABLE (Deta
SCHEDULE OF LOANS PAYABLE (Details) - USD ($) | Jun. 30, 2022 | Mar. 31, 2022 |
Debt Disclosure [Abstract] | ||
Equipment and insurance financing loans payable, between 3.30% and 12.02% interest and maturing between October 2022 and April 2027 | $ 12,397,347 | $ 502,052 |
Less: Current portion of loans payable | (334,134) | (253,006) |
Long-term portion of loans payable | $ 12,063,213 | $ 249,046 |
SCHEDULE OF LOANS PAYABLE (De_2
SCHEDULE OF LOANS PAYABLE (Details) (Parenthetical) | Jun. 30, 2022 | Mar. 31, 2022 |
Minimum [Member] | ||
Debt Instrument [Line Items] | ||
Debt interest rate | 3.30% | 3.30% |
Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt interest rate | 12.02% | 12.02% |
LOANS PAYABLE (Details Narrativ
LOANS PAYABLE (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Apr. 02, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | |
Line of Credit Facility [Line Items] | ||||
Interest expenses debt | $ 177,579 | $ 6,109 | ||
Loan and Security Agreement [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Principal amount | $ 12,000,000 | |||
Debt interest rate | 6.48% | |||
Debt issuance cost | $ 40,120 | $ 40,120 | ||
Debt instrument, description | The EWB Loan Agreement contains customary representations, warranties and covenants. These covenants include, but are not limited to, maintaining maximum leverage ratios of 3.50 to 1.00, minimum liquidity of $5,000,000, minimum cash of $1,000,000, a fixed charge coverage ratio of 1.25 to 1.00 and restrictions on mergers or sales of assets and debt borrowings | |||
Loan and Security Agreement [Member] | Prime Rate [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Debt interest rate | 1.73% | |||
Debt term | 5 years | |||
Debt maturity date | May 01, 2027 | |||
Loan and Security Agreement [Member] | Revolving Credit Facility [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit maximum borrowing capacity | $ 2,000,000 | |||
Line of credit, interest rate | 5.65% | |||
Loan and Security Agreement [Member] | Revolving Credit Facility [Member] | Prime Rate [Member] | ||||
Line of Credit Facility [Line Items] | ||||
Line of credit, interest rate | 0.87% | |||
Line of credit, maturity date | May 01, 2027 |
DEFERRED REVENUE (Details Narra
DEFERRED REVENUE (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Mar. 31, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | ||
Deferred revenues | $ 42,222 | $ 45,559 |
Deferred revenues current component | 13,333 | 13,333 |
Deferred revenues long-term component | $ 28,889 | $ 32,226 |
Deferred revenues term, description | These line items represent the unamortized amounts of a $200,000 advance payment received for a TAGI Pharma (“TAGI”) licensing agreement with a fifteen-year term beginning in September 2010 and ending in August 2025 | |
TAGI Pharma [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Unamortized amount | $ 200,000 | |
Licensing agreement beginning | Sep. 30, 2010 | |
Licensing agreement ending | Aug. 31, 2025 |
SCHEDULE OF FUTURE MINIMUM RENT
SCHEDULE OF FUTURE MINIMUM RENTAL PAYMENTS (Details) | Jun. 30, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2023 (excluding the three months ended June 30, 2022) | $ 195,216 |
2024 | 254,050 |
2025 | 243,612 |
2026 | 248,484 |
Thereafter | 189,144 |
Total future minimum lease payments | 1,130,506 |
Less: interest | (140,901) |
Present value of lease payments | $ 989,605 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details Narrative) | 1 Months Ended | 3 Months Ended | |||
Oct. 31, 2020 ft² | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Apr. 08, 2022 ft² | Mar. 31, 2022 USD ($) | |
Loss Contingencies [Line Items] | |||||
Operating lease, terms | The Pompano Office Lease is for approximately 1,275 square feet of office space, with Elite taking occupancy on November 1, 2020. The Pompano Office has a term of three years, ending on October 31, 2023 | ||||
Area of land | ft² | 35,000 | ||||
Rent expense | $ | $ 64,578 | $ 62,877 | |||
Other Noncurrent Liabilities [Member] | |||||
Loss Contingencies [Line Items] | |||||
Other long-term liabilities | $ | $ 40,551 | $ 38,780 | |||
Pompano Office Lease [Member] | Property Subject to Operating Lease [Member] | |||||
Loss Contingencies [Line Items] | |||||
Area of land | ft² | 1,275 |
SCHEDULE OF WARRANT ACTIVITY (D
SCHEDULE OF WARRANT ACTIVITY (Details) - $ / shares | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Derivative Financial Instruments Warrants | ||
Warrant Shares, Balance at beginning of period | 79,008,661 | 79,008,661 |
Weighted Average Exercise Price, Balance at beginning of period | $ 0.1521 | $ 0.1521 |
Warrant Shares, Warrants granted pursuant to the issuance of Series J convertible preferred shares | ||
Weighted Average Exercise Price, Warrants granted pursuant to the issuance of Series J convertible preferred shares (in Dollars per share) | ||
Warrant Shares, Warrants exercised, forfeited and/or expired, net | ||
Weighted Average Exercise Price, Warrants exercised, forfeited and/or expired, net (in Dollars per share) | ||
Warrant Shares, Balance at end of period | 79,008,661 | 79,008,661 |
Weighted Average Exercise Price, Balance at end of period | $ 0.1521 | $ 0.1521 |
SCHEDULE OF FAIR VALUE OF WARRA
SCHEDULE OF FAIR VALUE OF WARRANTS ISSUED (Details) | Jun. 30, 2022 | Mar. 31, 2022 |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Term | 4 years 9 months 18 days | 5 years 1 month 6 days |
Measurement Input, Share Price [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 0.0500 | 0.0350 |
Measurement Input, Price Volatility [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 0.7242 | 0.7655 |
Measurement Input, Exercise Price [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 0.1521 | 0.1521 |
Measurement Input, Risk Free Interest Rate [Member] | ||
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | ||
Warrants and Rights Outstanding, Measurement Input | 3.04 | 2.40 |
SCHEDULE OF CHANGES IN WARRANTS
SCHEDULE OF CHANGES IN WARRANTS MEASURED AT FAIR VALUE ON A RECURRING BASIS (Details) - Fair Value, Inputs, Level 3 [Member] - Warrant [Member] | 3 Months Ended |
Jun. 30, 2022 USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Beginning balance | $ 936,837 |
Change in fair value of derivative financial instruments - warrants | 500,143 |
Ending balance | $ 1,436,980 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS – WARRANTS (Details Narrative) - USD ($) | 1 Months Ended | ||
Apr. 28, 2020 | Apr. 28, 2017 | Jun. 30, 2022 | |
Series J Warrants [Member] | |||
Warrant expiration period | 10 years | ||
Initial exercise price | $ 0.1521 | ||
Chief Executive Officer [Member] | Series J Convertible Preferred Stock [Member] | |||
Conversion of stock, shares issued | 24.0344 | ||
Nasrat Hakim [Member] | Series J Convertible Preferred Stock [Member] | |||
Conversion of stock, shares issued | 158,017,321 | ||
Warrant to purchase shares | 79,008,661 | ||
Fair value of the warrants | $ 6,474,674 |
SHAREHOLDERS_ EQUITY (Details N
SHAREHOLDERS’ EQUITY (Details Narrative) - USD ($) | 3 Months Ended | ||
Jul. 08, 2020 | Jun. 30, 2022 | Mar. 31, 2022 | |
Restructuring Cost and Reserve [Line Items] | |||
Common stock, par value per share | $ 0.001 | $ 0.001 | |
2020 LPC Purchase Agreement [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Stock issued during period, shares | 5,975,857 | ||
Stock issued during period, value | $ 469,105 | ||
Lincoln Park [Member] | |||
Restructuring Cost and Reserve [Line Items] | |||
Purchase of common stock, amount | $ 25,000,000 | ||
Common stock, par value per share | $ 0.001 |
SCHEDULE OF STOCK OPTION PLAN (
SCHEDULE OF STOCK OPTION PLAN (Details) | 3 Months Ended |
Jun. 30, 2022 $ / shares shares | |
Share-Based Payment Arrangement [Abstract] | |
Outstanding, Beginning Balance | shares | 5,650,000 |
Weighted Average Exercise Price, Beginning Balance | $ 0.14 |
Weighted Average Remaining Contractual Term | 2 years 9 months 18 days |
Granted, Option | shares | 1,100,000 |
Granted, Exercise price | $ 0.04 |
Term granted | 10 years |
Grants intrinsic value | $ 13,970 |
Outstanding, Ending Balance | shares | 6,750,000 |
Outstanding, Weighted Average Exercise Price, Ending Balance | $ 0.14 |
Weighted Average Remaining Contractual Term | 2 years 9 months 18 days |
Options, Exercisable, Ending Balance | shares | 4,530,001 |
Exercisable, Weighted Average Exercise Price Ending Balance | $ 0.16 |
Weighted Average Remaining Contractual Term (in years), Exercisable | 2 years 3 months 18 days |
STOCK-BASED COMPENSATION (Detai
STOCK-BASED COMPENSATION (Details Narrative) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Mar. 31, 2022 | |
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Price difference between exercise price and quoted price | $ 0.09 | $ 0.10 |
Unrecognized stock based compensation expense | $ 44,330 | |
Recognized over period | 2 years 9 months 18 days | |
Employee Stock [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Salaries wages and officers compensation | $ 193,750 | |
Common stock in payment of salaries | 2,274,102 | |
Common Stock [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Shares, issued | 1,744,608 | |
Director [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Accrued director fees | $ 112,500 | |
Cash payment | $ 37,500 | |
President and Chief Executive Officer and Other Employees [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Shares, issued | 53,107,446 | |
President and Chief Executive Officer and Other Employees [Member] | Common Stock [Member] | ||
Deferred Compensation Arrangement with Individual, Excluding Share-Based Payments and Postretirement Benefits [Line Items] | ||
Other employee salary | $ 3,750,000 |
CONCENTRATIONS AND CREDIT RISK
CONCENTRATIONS AND CREDIT RISK (Details Narrative) - Integer | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | Mar. 31, 2022 | |
Revenue Benchmark [Member] | |||
Concentration Risk [Line Items] | |||
Number of customers | 2 | 2 | |
Purchases [Member] | |||
Concentration Risk [Line Items] | |||
Number of suppliers | 2 | 2 | |
One Customer [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 85% | 83% | |
Two Customers [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 90% | 91% | |
Customer One [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 80% | 78% | |
Customer Two [Member] | Accounts Receivable [Member] | Customer Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 10% | 13% | |
Two Suppliers [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 66% | 52% | |
Supplier One [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 56% | 38% | |
Supplier Two [Member] | Purchases [Member] | Supplier Concentration Risk [Member] | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 10% | 14% |
SCHEDULE OF SELECTED INFORMATIO
SCHEDULE OF SELECTED INFORMATION FOR REPORTABLE SEGMENTS (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting Information [Line Items] | ||
Operating Income by Segment | $ 1,022,684 | $ 965,158 |
Abbreviated New Drug Applications [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating Income by Segment | 2,252,145 | 2,351,334 |
New Drug Applications [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating Income by Segment | ||
Business Segment [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating Income by Segment | $ 2,252,145 | $ 2,351,334 |
SCHEDULE OF OPERATING LOSS BY S
SCHEDULE OF OPERATING LOSS BY SEGMENT TO (LOSS) INCOME FROM OPERATIONS (Details) - USD ($) | 3 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Segment Reporting Information [Line Items] | ||
Operating income by segment | $ 1,022,684 | $ 965,158 |
Interest income | 129 | 42 |
Depreciation and amortization expense | (296,294) | (312,702) |
Income from operations before income taxes | 305,883 | 1,533,768 |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Operating income by segment | 2,252,145 | 2,351,334 |
Corporate unallocated costs | (716,872) | (851,856) |
Interest income | 129 | 42 |
Interest expense and amortization of debt issuance costs | (216,787) | (45,893) |
Depreciation and amortization expense | (296,294) | (312,702) |
Significant non-cash items | (216,295) | (221,618) |
Change in fair value of derivative instruments | (500,143) | 614,461 |
Income from operations before income taxes | $ 305,883 | $ 1,533,768 |
RELATED PARTY AGREEMENTS WITH_2
RELATED PARTY AGREEMENTS WITH MIKAH PHARMA, LLC (Details Narrative) | Mar. 31, 2021 USD ($) |
Mikha Pharma LLC [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Advance payment for purchase received | $ 238,451 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) | 3 Months Ended |
Jun. 30, 2022 USD ($) | |
Income Tax Disclosure [Abstract] | |
Income tax expense benefit | $ 0 |
Statutory income tax rate, percent | 21% |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) $ in Thousands | Jul. 01, 2022 USD ($) | Apr. 08, 2022 ft² |
Subsequent Event [Line Items] | ||
Area of Land | ft² | 35,000 | |
East West Bank (EWB) [Member] | Mortgages [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Proceeds from issuance of debt | $ | $ 2,550 | |
Debt term | 10 years | |
Interest rate, description | bears interest at a rate of 4.75% fixed for 5 years then adjustable at WSJP plus 0.5% with floor rate of 4.5% |