Ocata Therapeutics (OCAT) Inactive 10-Q11 Aug 142014 Q2 Quarterly reportFinancial data

Company Profile

Document_and_Entity_Informatio

Document and Entity Information	6 Months Ended
Document and Entity Information	Jun. 30, 2014	Aug. 04, 2014
Document And Entity Information	'	'
Entity Registrant Name	'ADVANCED CELL TECHNOLOGY, INC.	'
Entity Central Index Key	'0001140098	'
Document Type	'10-Q	'
Document Period End Date	30-Jun-14	'
Amendment Flag	'false	'
Current Fiscal Year End Date	'--12-31	'
Is Entity a Well-known Seasoned Issuer?	'No	'
Is Entity a Voluntary Filer?	'No	'
Is Entity's Reporting Status Current?	'Yes	'
Entity Filer Category	'Accelerated Filer	'
Entity Common Stock, Shares Outstanding	'	3,363,698,522
Document Fiscal Period Focus	'Q2	'
Document Fiscal Year Focus	'2014	'

CONSOLIDATED_BALANCE_SHEETS

CONSOLIDATED BALANCE SHEETS (USD $)	Jun. 30, 2014	Dec. 31, 2013
ASSETS	'	'
Cash and cash equivalents	$4,062,330	$1,743,485
Other receivables	54,258	209,198
Deferred royalty fees, current portion	62,435	62,435
Prepaid expenses and other current assets	419,541	896,741
Total current assets	4,598,564	2,911,859
Property and equipment, net	808,619	753,576
Deferred royalty fees, less current portion	76,561	107,780
Other assets	58,685	68,801
Deferred costs	0	65,903
TOTAL ASSETS	5,542,429	3,907,919
LIABILITIES AND STOCKHOLDERS' DEFICIT	'	'
Accounts payable	3,346,816	2,285,331
Accrued expenses	2,618,821	3,545,713
Accrued settlement	3,099,411	4,086,619
Senior secured convertible debentures, current portion, net of discount of $225,324 at December 31, 2013	0	2,174,676
Embedded conversion option liabilities, current portion	0	335,208
Loss contingency accrual	221,581	6,431,979
Unsettled warrant obligation	0	3,899,391
Deferred revenue, current portion	157,872	157,872
Total current liabilities	9,444,501	22,916,789
Senior secured convertible debentures, less current portion, net of discount of $37,553 at December 31, 2013	0	1,162,447
Embedded conversion option liabilities, less current portion	0	327,792
Warrant and option derivative liabilities	270,999	284,799
Deferred revenue, less current portion	1,670,763	1,749,702
Total liabilities	11,386,263	26,441,529
Commitments and contingencies	'	'
STOCKHOLDERS' DEFICIT:	'	'
Common stock, $0.001 par value; 3,750,000,000 shares authorized, 3,307,187,075 and 2,640,264,975 shares issued and outstanding at June 30, 2014 and December 31, 2013, respectively	3,307,188	2,640,265
Additional paid-in capital	360,462,530	322,683,874
Promissory notes receivable, net of discount of $1,368,433 and $2,018,321, at June 30, 2014 and December 31, 2013, respectively	-31,498,191	-34,013,395
Accumulated deficit	-338,115,364	-313,844,357
Total stockholders' deficit	-5,843,834	-22,533,610
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT	5,542,429	3,907,919
Series B Preferred Stock	'	'
STOCKHOLDERS' DEFICIT:	'	'
Preferred stock	1	1
Total stockholders' deficit	1	1
Series C Preferred Stock	'	'
STOCKHOLDERS' DEFICIT:	'	'
Preferred stock	2	2
Total stockholders' deficit	$2	$2

CONSOLIDATED_BALANCE_SHEETS_Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Jun. 30, 2014	Dec. 31, 2013
CURRENT LIABILITIES:	'	'
Discount on senior secured convertible debentures - current	$0	$225,324
Discount on senior secured convertible debentures - noncurrent	0	37,553
STOCKHOLDERS' DEFICIT:	'	'
Common stock par value (in Dollars per share)	$0.00	$0.00
Common stock shares authorized	3,750,000,000	3,750,000,000
Common stock shares issued	3,307,187,075	2,640,264,975
Common stock shares outstanding	3,307,187,075	2,640,264,975
Discount on promissory notes receivable	$1,368,433	$2,018,321
Series B Preferred Stock	'	'
STOCKHOLDERS' DEFICIT:	'	'
Preferred stock par value	$0.00	$0.00
Preferred stock shares authorized	50,000,000	50,000,000
Preferred stock shares issued	750	1,000
Preferred stock shares outstanding	750	1,000
Series C Preferred Stock	'	'
STOCKHOLDERS' DEFICIT:	'	'
Preferred stock par value	$0.00	$0.00
Preferred stock shares authorized	50,000,000	50,000,000
Preferred stock shares issued	1,750	1,750
Preferred stock shares outstanding	1,750	1,750

CONSOLIDATED_STATEMENTS_OF_OPE

CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		6 Months Ended
CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Income Statement [Abstract]	'	'	'	'
Revenue (License fees and royalties)	$39,469	$58,268	$78,937	$146,049
Cost of Revenue	15,608	16,859	31,217	51,218
Gross profit	23,861	41,409	47,720	94,831
Operating expenses:	'	'	'	'
Research and development	2,718,625	2,975,270	5,226,469	6,073,829
General and administrative expenses	2,175,749	2,652,843	5,488,312	5,486,712
Loss on settlement of litigation	11,567,009	0	13,468,547	0
Total operating expenses	16,461,383	5,628,113	24,183,328	11,560,541
Loss from operations	-16,437,522	-5,586,704	-24,135,608	-11,465,710
Non-operating income (expense):	'	'	'	'
Interest income	951	1,015	55,840	2,792
Interest expense	-132,532	-370,228	-429,504	-894,417
Finance (loss) gain	-343,511	-291,139	-394,237	45,741
Adjustments to fair value of unsettled warrant obligation	1,004,867	-556,153	18,959	-1,169,185
Fines	0	-587,147	0	-587,147
Gain on extinguishment of debt	0	438,587	0	438,587
Adjustments to fair value of derivatives	389,771	57,713	676,800	224,646
Total non-operating income (expense)	919,546	-1,307,352	-72,142	-1,938,983
Loss before provision for income tax	-15,517,976	-6,894,056	-24,207,750	-13,404,693
Provision for income tax	0	0	0	0
Net loss	($15,517,976)	($6,894,056)	($24,207,750)	($13,404,693)
Weighted average shares outstanding : Basic and diluted	2,955,457,728	2,451,694,258	2,845,066,346	2,389,481,712
Loss per share: Basic and diluted	($0.01)	$0	($0.01)	($0.01)

CONSOLIDATED_STATEMENTS_OF_STO

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (USD $)	Series B Preferred Stock	Series C Preferred Stock	Common Stock	Additional Paid-In Capital	Promissory Notes Receivable, net	Accumulated Deficit	Total
Beginning balance, amount at Dec. 31, 2013	$1	$2	$2,640,265	$322,683,874	($34,013,395)	($313,844,357)	($22,533,610)
Beginning balance, shares at Dec. 31, 2013	1,000	1,750	2,640,264,975	'	'	'	'
Shares issued for settlements, shares	'	'	427,373,609	'	'	'	'
Shares issued for settlements, amount	'	'	427,374	25,550,226	'	'	25,977,600
Shares issued for services, shares	'	'	1,927,826	'	'	'	'
Shares issued for services, amount	'	'	1,973	140,761	'	'	142,734
Redemption of Preferred Stock, shares	-250	'	'	'	'	'	'
Redemption of Preferred Stock, amount	'	'	'	-3,739,071	3,668,942	'	-70,129
Accrued dividends on Series B and C Preferred Stock	'	'	'	1,216,995	'	-1,216,995	'
Accretion of note receivable discount on Series B and C Preferred Stock	'	'	'	'	-1,153,738	1,153,738	'
Stock based compensation	'	'	'	566,026	'	'	566,206
Issuance of shares of common stock as a commitment fee, shares	'	'	10,600,707	'	'	'	'
Issuance of shares of common stock as a commitment fee, amount	'	'	10,601	-10,601	'	'	'
Issuance of common stock in financing arrangement, shares	'	'	226,974,958	'	'	'	'
Issuance of common stock in financing arrangement, amount	'	'	226,975	14,054,320	'	'	14,281,295
Net loss	'	'	'	'	'	-24,207,750	-24,207,750
Ending balance, amount at Jun. 30, 2014	$1	$2	$3,307,188	$360,462,530	($31,498,191)	($338,115,364)	($5,843,834)
Ending balance, shares at Jun. 30, 2014	750	1,750	3,307,187,075	'	'	'	'

CONSOLIDATED_STATEMENTS_OF_CAS

CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	6 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	Jun. 30, 2014	Jun. 30, 2013
CASH FLOWS FROM OPERATING ACTIVITIES:	'	'
Net loss	($24,207,750)	($13,404,693)
Adjustments to reconcile net loss to net cash used in operating activities:	'	'
Depreciation	64,342	37,702
Amortization of deferred charges	31,217	81,218
Amortization of deferred revenue	-78,937	-145,999
Redeemable preferred stock dividend accrual	0	43,873
Stock based compensation	566,026	2,031,005
Amortization of deferred issuance costs	65,903	303,765
Amortization of discounts	262,877	326,770
Adjustments to fair value of derivatives	-676,800	-224,646
Shares of common stock issued for compensation	142,734	849,659
Non-cash financing costs	18,223	-1,154,233
Loss on settlement of litigation	13,468,547	0
Adjustment to the fair value of unsettled warrant obligation	-18,959	1,169,185
Gain on debt extinguishment	0	-438,587
Warrants and options issued for consulting services	0	22,145
Changes in operating assets and liabilities	'	'
Prepaid expenses, other asets and other receivables	642,256	-210,873
Accounts payable and other liabilities	-852,615	-1,769,780
Net cash used in operating activities	-10,572,936	-12,483,489
CASH FLOWS FROM INVESTING ACTIVITIES	'	'
Purchases of property and equipment	-119,385	-434,598
Payment of lease deposits	0	-8,364
Net cash used in investing activities	-119,385	-442,962
CASH FLOWS FROM FINANCING ACTIVITIES:	'	'
Proceeds from issuance of common stock	14,281,295	11,748,653
Repayment of senior secured convertible debentures	-1,200,000	-600,000
Redemption of 250 shares of Series B Preferred Stock, net	-70,129	0
Net cash provided by financing activities	13,011,166	11,148,653
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	2,318,845	-1,777,798
CASH AND CASH EQUIVALENTS, BEGINNING BALANCE	1,743,485	7,241,852
CASH AND CASH EQUIVALENTS, ENDING BALANCE	4,062,330	5,464,054
CASH PAID FOR: Interest	100,724	192,000
Income taxes	0	0
SUPPLEMENTAL DISCLOSURE OF NON-CASH FINANCING ACTIVITIES:	'	'
Accrued dividends on Series B and C Preferred Stock	1,216,995	1,155,397
Accretion of note receivable discount on Series B and C Preferred Stock	1,153,738	1,165,702
Issuance of 427,373,609 and 100,283,406 shares of common stock for accrued settlement	25,977,600	5,700,000
Conversion of Series A Preferred stock for 27,522,833 shares of common stock	$0	$1,912,837

CONSOLIDATED_STATEMENTS_OF_CAS1

CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical)	6 Months Ended
CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical)	Jun. 30, 2014	Jun. 30, 2013
Statement of Cash Flows [Abstract]	'	'
Issuance of shares of common stock for accrued settlement	427,373,609	100,283,406
Series A Preferred stock converted, shares	0	27,522,833
Common stock shares issued as commitment fee	10,606,707	'

1_ORGANIZATIONAL_MATTERS

1. ORGANIZATIONAL MATTERS	6 Months Ended
1. ORGANIZATIONAL MATTERS	Jun. 30, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]	'
1. ORGANIZATIONAL MATTERS	'
	The unaudited consolidated financial statements have been prepared by Advanced Cell Technology, Inc. and Subsidiary (collectively the “Company”), pursuant to the rules and regulations of the Securities and Exchange Commission. The information furnished herein reflects all adjustments (consisting of normal recurring accruals and adjustments) which are, in the opinion of management, necessary to fairly present the operating results for the respective periods. Certain information and footnote disclosures normally present in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) have been omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on April 1, 2014. The results for the six months ended June 30, 2014 are not necessarily indicative of the results to be expected for the full year ending December 31, 2014.

	Organization and Nature of Business

	The Company is a biotechnology company, incorporated in the state of Delaware, engaged in the development and commercialization of human pluripotent stem cell technology in the field of regenerative medicine. The Company is conducting clinical trials for treating dry age-related macular degeneration and Stargardt’s macular degeneration, in addition to several clinical and preclinical programs for other ocular therapies. The Company also has a preclinical development pipeline in areas outside of ophthalmology, including; autoimmune diseases, inflammatory diseases, and wound healing. The Company’s intellectual property portfolio includes pluripotent human embryonic stem cell, or hESC; induced pluripotent stem cell, or iPSC, platforms; and other cell therapy research programs. The corporate headquarters and principle laboratory and manufacturing facilities are located in Marlborough, Massachusetts.

2_RESTATEMENT_OF_PREVIOUSLY_IS

2. RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS	6 Months Ended
	Jun. 30, 2014
Accounting Changes and Error Corrections [Abstract]	'
2. RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS	'
	On March 10, 2014, the Company concluded that its previously issued consolidated financial statements required a restatement for the years ended December 31, 2012 and 2011. The Company determined that a misapplication of accounting guidance relating to certain warrants and an associated full-ratchet anti-dilution feature that was included in these warrants occurred. Additionally the Company concluded that it had an error with its stock compensation accounting as a result of having inadequate authorized, unissued shares available for its outstanding options in certain periods. As a result of these errors the Company determined that its financial statements for the following periods (the “Applicable Periods”) required a restatement and could no longer be relied upon: the fiscal years ended December 31, 2009, December 31, 2010, December 31, 2011 and December 31, 2012; each quarterly period in 2011 and 2012; and the first three quarterly periods in its fiscal year ended December 31, 2013.

	Warrant Accounting Issue

	Two separate warrant agreements entered into in September 2005 contained a full ratchet, anti-dilution feature which entitled the holders to automatic adjustments in the number and purchase price of their shares, if the Company issued lower-priced shares between May 1, 2005 and January 15, 2009, ( the “Pricing Period”). From the original date of the warrant until the exercise of the warrants in September 2006, the anti-dilution embedded derivative feature was properly accounted for and recorded at its fair value. From the date of exercise through the end of the pricing period, the full ratchet feature remained in effect but was not accounted for or recorded at its fair value, which resulted in an accounting error. In determining the proper accounting management performed a valuation of this full ratchet embedded derivative using a Monte Carlo simulation model.

	Management further determined that as of the end of the pricing period an adjustment to the shares and purchase price of the shares should have taken place per the full ratchet anti-dilution feature of the warrant. As the matter went to litigation this contractual obligation was never settled and became fixed at 63.2 million shares with a floor price of $0.06. This unsettled warrant contractual obligation should have been recorded from the end of the pricing period until settlement with accounting treatment, under ASC 815, requiring mark-to-market adjustments at each reporting date.

	Due to the resulting financial statement impact within the years impacted, the Company has determined it is necessary to restate its financial statements for the Applicable Periods.

	Stock Compensation Issue related to inadequate authorized and unissued shares to settle share based awards in shares

	The Company examined periods being restated for the warrant liability issue to determine if authorized, unissued share availability was an issue in relation to instruments that have share based settlement requirements. Through this analysis it was determined that stock options were impacted in certain periods while other instruments such as warrants, convertible debt and preferred stock already had liability classification and therefore would not be impacted by inadequate authorized, unissued shares available.

	It was determined that in Q1 2009, Q2 2009 and Q4 2011 options outstanding were impacted by the lack of authorized, unissued shares available. It was further determined that the date in which committed shares exceeded unauthorized was February 9, 2009 and that shortage of available shares ran through September 10, 2009, when additional authorized shares were approved. As for 2011, the share issue began on November 2, 2011 and ran through January 24, 2012, when additional authorized shares were approved.

	As per the accounting requirements of ASC 718, the inadequate share issue caused the accounting to change from equity based to liability based accounting, with the vested options to be measured at fair value as a liability until such time as adequate shares were approved and the accounting for the stock compensation would revert back to equity based accounting.

	This accounting error in treating the stock compensation as equity throughout these periods with inadequate authorized unissued shares, led the Company to re-measure all stock options impacted during these periods to effect the proper accounting treatment.

	Due to the resulting financial statement impact within the years impacted, the Company has determined it is necessary to restate its financial statements for the Applicable Periods.

	The following tables summarize the effects of the restatement on the Company’s previously issued condensed consolidated financial statements:

	Summary of increases (decreases) in net loss (unaudited)

			Three months ended June 30, 2013				Six months ended June 30, 2013

	Net loss, as previously reported		$	(6,611,346	)		$	(13,024,387	)
	Net adjustments
	Research and development			(113,033	)			(219,592	)
	General and administrative expenses			(9,524	)			(17,529	)
	Adjustments to fair value of unsettled warrant obligation			(160,153	)			(143,185	)
	Net loss, restated		$	(6,894,056	)		$	(13,404,693	)
	Basic loss per share:
	Net loss, as previously reported		$	(0.00	)		$	(0.01	)
	Net adjustments
	Research and development			(0.00	)			(0.00	)
	General and administrative expenses			(0.00	)			(0.00	)
	Adjustments to fair value of unsettled warrant obligation			0				0
	Net loss, restated		$	(0.00	)		$	(0.01	)
	Diluted loss per share:
	Net loss, as previously reported		$	(0.00	)		$	(0.01	)
	Net adjustments
	Research and development			(0.00	)			(0.00	)
	General and administrative expenses			(0.00	)			(0.00	)
	Adjustments to fair value of unsettled warrant obligation			0				0
	Net loss, restated		$	(0.00	)		$	(0.01	)
	Weighted average shares used in computing net loss per share:
	Basic			2,451,694,258				2,389,481,712
	Diluted			2,451,694,258				2,389,481,712

	Consolidated Statements of Operations (unaudited) for the three months ended June 30, 2013

			Three months ended June 30, 2013
			As Previously Reported				Adjustments				As Restated

	Revenue		$	58,268							$	58,268
	Cost of revenue			16,859								16,859
	Gross profit			41,409				–				41,409
	Operating expenses:
	Research and development			2,862,237				113,033				2,975,270
	General and administrative expenses			2,643,319				9,524				2,652,843
Total operating expenses			5,505,556				122,557				5,628,113
Loss from operations			(5,464,147	)			(122,557	)			(5,586,704	)
Non-operating income (expense):
Interest income			1,015								1,015
Interest expense and late fees			(370,228	)							(370,228	)
Finance gain (cost)			(687,139	)			396,000				(291,139	)
Fines and penalties			(587,147	)							(587,147	)
Gain on extinguishment of debt			438,587								438,587
Adjustments to fair value of unsettled warrant obligation			–				(556,153	)			(556,153	)
Adjustments to fair value of derivatives			57,713								57,713
Total non-operating expense			(1,147,199	)			(160,153	)			(1,307,352	)
Loss before provision for income tax			(6,611,346	)			(282,710	)			(6,894,056	)
Provision for income tax			–				–				–
Net loss		$	(6,611,346	)		$	(282,710	)		$	(6,894,056	)
Loss per share:
Basic		$	(0.00	)		$	(0.00	)		$	(0.00	)
Diluted			(0.00	)			(0.00	)			(0.00	)
Weighted average shares outstanding:
Basic			2,451,694,258				–				2,451,694,258
Diluted			2,451,694,258				–				2,451,694,258

Consolidated Statements of Operations (unaudited) for the six months ended June 30, 2013

		Six months ended June 30, 2013
		As Previously Reported				Adjustments				As Restated

Revenue		$	146,049							$	146,049
Cost of revenue			51,218								51,218
Gross profit			94,831				–				94,831
Operating expenses:
Research and development			5,854,237				219,592				6,073,829
General and administrative expenses			5,469,183				17,529				5,486,712
Total operating expenses			11,323,420				237,121				11,560,541
Loss from operations			(11,228,589	)			(237,121	)			(11,465,710	)
Non-operating income (expense):
Interest income			2,792								2,792
Interest expense and late fees			(894,417	)							(894,417	)
Finance gain (cost)			(980,259	)			1,026,000				45,741
Fines and penalties			(587,147	)							(587,147	)
Gain on extinguishment of debt			438,587								438,587
Adjustments to fair value of unsettled warrant obligation			–				(1,169,185	)			(1,169,185	)
Adjustments to fair value of derivatives			224,646								224,646
Total non-operating expense			(1,795,798	)			(143,185	)			(1,938,983	)
Loss before provision for income tax			(13,024,387	)			(380,306	)			(13,404,693	)
Provision for income tax			–				–				–
Net loss		$	(13,024,387	)		$	(380,306	)		$	(13,404,693	)
Loss per share:
Basic		$	(0.01	)		$	(0.00	)		$	(0.01	)
Diluted			(0.01	)			(0.00	)			(0.01	)
Weighted average shares outstanding:
Basic			2,389,481,712				–				2,389,481,712
Diluted			2,389,481,712				–				2,389,481,712

Consolidated Statement of Cash Flows Impact

The following table includes selected information from the Company’s consolidated statements of cash flows presenting previously reported and restated cash flows, for the six months ended June 30, 2013:

		For the six months ended
		30-Jun-13
		As Previously Reported				As
		As Previously Reported				Restated

Net loss		$	(13,024,387	)		$	(13,404,693	)
Stock based compensation			1,793,884				2,031,005
Adjustments to fair value of unsettled warrant obligation			–				1,169,185
Non-cash financing costs			(128,233	)			(1,154,233	)
Net cash used in operating activities			(12,483,489	)			(12,483,489	)

3_SUMMARY_OF_SIGNIFICANT_ACCOU

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation —The Company follows accounting standards set by the Financial Accounting Standards Board, FASB. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, GAAP. References to GAAP issued by the FASB in these footnotes are to the FASB Accounting Standards Codification,™ sometimes referred to as the Codification or ASC.

The accompanying consolidated financial statements have been prepared in conformity with GAAP which contemplate continuation of the company as a going concern. However, as of June 30, 2014, the Company has an accumulated deficit of $338.1 million. The ability to continue as a going concern is dependent upon many factors, including the Company’s ability to raise additional capital in a timely manner. The Company entered into an agreement for a $30 million equity line arrangement in late June 2014. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

Principles of Consolidation — The accounts of the Company and its wholly-owned subsidiary Mytogen, Inc. are included in the accompanying consolidated financial statements. All intercompany balances and transactions were eliminated in consolidation.

Segment Reporting —ASC 280, “Segment Reporting” requires use of the “management approach” model for segment reporting. The management approach model is based on the way a company’s management organizes segments within the company for making operating decisions and assessing performance. The Company determined it has one operating segment. Disaggregation of the Company’s operating results is impracticable, because the Company’s research and development activities and its assets overlap, and management reviews its business as a single operating segment. Thus, discrete financial information is not available by more than one operating segment.

Use of Estimates — These consolidated financial statements have been prepared in accordance with GAAP and, accordingly, require management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Specifically, the Company’s management has estimated loss contingencies related to outstanding litigation. In addition, Management has estimated variables used to calculate the Black-Scholes option pricing model used to value derivative instruments and the Company estimates the fair value of the embedded conversion option associated with the senior secured convertible debentures using a binomial lattice model as discussed below under “Fair Value Measurements”. Also, management has estimated the expected economic life and value of the Company’s licensed technology, the Company’s net operating loss for tax purposes, share-based payments for compensation to employees, directors, consultants and investment banks, and the useful lives of the Company’s fixed assets. Actual results could differ from those estimates.

Cash and Cash Equivalents — Cash equivalents are comprised of certain highly liquid investments with maturities of three months or less when purchased. The Company maintains its cash in bank deposit accounts, which at times, may exceed federally insured limits. The Company has not experienced any losses related to this concentration of risk. As of June 30, 2014 and December 31, 2013, the Company had deposits in excess of federally-insured limits totaling $3,678,495 and $1,668,232, respectively.

Commitments and Contingencies — The Company is subject to various claims and contingencies related to lawsuits as well as commitments under contractual and other obligations. The Company recognizes liabilities for contingencies and commitments when a loss is probable and can be reasonably estimated.

Relating to loss contingencies the Company accrues the best estimate of a loss within a range. If no estimate in a range is better than any other, the minimum amount is accrued. The Company discloses a reasonably possible loss in excess of the amount accrued, if applicable. For reasonably possible loss contingencies the Company discloses the nature of the loss contingency and give a range of the estimate of possible loss or state that an estimate cannot be made.

Grant Received — From time to time, the Company participates in research grants both as an initiator of grants as well as a sub-recipient of grant funds. The Company incurs costs for the grant and is subsequently reimbursed for these expenses by grant receipts. The Company records such receipts as a reduction in research and development costs. For the three and six months ended June 30, 2014, the Company had no research grants recorded. For the three and six months ended June 30, 2013, the Company recorded $60,022 and $120,044, respectively, as a reduction in research and development costs.

Grants Receivable — The Company periodically assesses its grants receivable for collectability on a specific identification basis. If collectability of an account becomes unlikely, the Company records an allowance for that doubtful account. Once the Company has exhausted efforts to collect, management writes off the grants receivable against the allowance it has already created.

Property and Equipment — The Company records its property and equipment at historical cost. The Company expenses maintenance and repairs as incurred. Upon disposition of property and equipment, the gross cost and accumulated depreciation are written off and the difference between the proceeds and the net book value is recorded as a gain or loss on sale of assets. In the case of certain assets acquired under capital leases, the assets are recorded net of imputed interest, based upon the net present value of future payments. Assets under capital lease are pledged as collateral for the related lease.

The Company provides for depreciation over the assets’ estimated useful lives as follows:

Machinery & equipment

4 years

Computer equipment

3 years

Office furniture

4 years

Leasehold improvements

Lesser of lease life or economic life

Capital leases

Lesser of lease life or economic life

Patents — The Company follows ASC 350-30, “General Intangibles Other than Goodwill,” in accounting for its patents. ASC 350-30 provides that costs of internally developing, maintaining, or restoring intangible assets that are not specifically identifiable, that have indeterminate lives, or that are inherent in a continuing business and related to an entity as a whole, shall be recognized as an expense when incurred. The Company has expensed as research and development expense all costs associated with developing its patents.

Equity Method Investment — The Company follows ASC 323, “Investments-Equity Method and Joint Ventures,” in accounting for its investment in the joint venture. In the event the Company’s share of the joint venture’s net losses reduces the Company’s investment to zero, the Company will discontinue applying the equity method and will not provide for additional losses unless the Company has guaranteed obligations of the joint venture or is otherwise committed to provide further financial support for the joint venture. If the joint venture subsequently reports net income, the Company will resume applying the equity method only after its share of that net income equals the share of net losses not recognized during the period the equity method was suspended.

Deferred Costs — Consist of the following:

(a) Payments, either in cash or share-based, made in connection with the sale of debentures which are amortized using the effective interest method over the lives of the related debentures. These deferred issuance costs are charged to financing costs when and if the related debt instrument is retired or converted early. The weighted average amortization period for deferred debt issuance costs is 48 months.

(b) Payments made to secure commitments under certain financing arrangements. These amounts are recognized in financing costs ratably over the period of the financing arrangements, and are recognized in financing costs immediately if the arrangement is cancelled, forfeited or the utility of the arrangement to the company is otherwise compromised.

(c) Payments made to financial institutions and consulting firms in order to provide financing related services. These costs are being amortized over the terms of the related agreements.

Long-Lived Assets— The Company follows ASC 360-10, “Property, Plant, and Equipment,” which established a “primary asset” approach to determine the cash flow estimation period for a group of assets and liabilities that represents the unit of accounting for a long-lived asset to be held and used. Long-lived assets to be held and used are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The carrying amount of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less cost to sell. Through June 30, 2014, the Company had not experienced impairment losses on its long-lived assets.

Fair Value Measurements — The Company applies the provisions of ASC 820-10, “Fair Value Measurements and Disclosures.” ASC 820-10 defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. For certain financial instruments, including cash and cash equivalents, grants receivable, prepaid expenses, accounts payable and accrued expenses, the carrying amounts approximate fair value due to their relatively short maturities. The carrying amount of senior secured convertible debentures approximates fair value as the interest rate charged on the debentures is based on the prevailing rate. The three levels of valuation hierarchy are defined as follows:

Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The Company analyzes all financial instruments with features of both liabilities and equity under ASC 480, “Distinguishing Liabilities From Equity,” and ASC 815, “Derivatives and Hedging.” Derivative liabilities are adjusted to reflect fair value at each period end, with any increase or decrease in the fair value being recorded in results of operations as adjustments to fair value of derivatives. The effects of interactions between embedded derivatives are calculated and accounted for in arriving at the overall fair value of the financial instruments. In addition, the fair values of freestanding derivative instruments such as warrant and option derivatives are valued using the Black-Scholes model.

The Company uses Level 2 inputs for its valuation methodology for certain warrant derivative liabilities. The Company’s derivative liabilities are adjusted to reflect fair value at each period end, with any increase or decrease in the fair value being recorded in results of operations as adjustments to fair value of derivatives.

The Company uses Level 3 inputs for its valuation methodology for the fair value of certain embedded conversion options and warrant and option derivative liabilities.

The Company estimates the fair value of the embedded conversion option associated with its 8% convertible debentures using a binomial lattice, which estimates and compares the present value of the principal and interest payments to the as converted value to determine whether the holder of the notes should convert the notes into the Company’s common stock or continue to receive principal and interest payments. The Company uses this methodology to determine the beneficial conversion features because there are no observable inputs available with respect to the fair value.

The binomial lattice relies on the following Level 3 inputs: (1) expected volatility of the Company’s common stock; (2) potential discount for illiquidity of large blocks of the Company’s common stock, and (3) discount rate for contractual debt principal and interest payments. The fair value of the embedded beneficial conversion feature is estimated as the difference between the fair value of the notes with and without the conversion feature. The fair value of the notes without the conversion feature is determined using one Level 3 input, the discount rate for contractual debt interest and principal payments.

The expected volatility of the Company’s common stock is estimated from the historical volatility of daily returns in the Company’s common stock price. The Company monitors the volatility of its common stock on a quarterly basis to observe trends that may impact the fair value of the notes.

The discount for illiquidity is measured using an average-strike option that calculates the discount as the opportunity cost for not being able to sell a large block of the Company’s common stock immediately at prevailing observable market prices. Inputs to the average-strike option model include the expected volatility of the Company’s common stock and time to sell a large block of the Company’s stock as Level 3 inputs and other observable inputs. The time to sell the stock is estimated considering the historical daily trading volume of the Company’s common stock and market maker estimates of the amount of shares that can be offered for sale above the normal the daily trading volume without depressing the price of the Company’s common stock.

At June 30, 2014, the Company identified the following assets and liabilities that are required to be presented on the balance sheet at fair value:

Description

Fair Value

Fair Value Measurements at

As of

30-Jun-14

Using Fair Value Hierarchy

Level 1

Level 2

Level 3

Warrant and option derivative liabilities

270,999

–

270,999

Total

270,999

–

270,999

The following tables reconcile the change in fair value for measurements categorized within Level 3 of the fair value hierarchy:

Warrant and Option Derivative Liabilities

Balance at December 31, 2013

284,799

Total (gains) for the period included in earnings

(13,800

)

Balance at June 30, 2014

270,999

Embedded Conversion Option Liabilities

Balance at December 31, 2013

663,000

Total (gains) for the period included in earnings

(663,000

)

Balance at June 30, 2014

–

Gains and losses included in earnings for the six months ended June 30, 2014 are reported as follows:

Warrant and Option Derivative Liabilities

Total gain included in earnings

13,800

Embedded Conversion Option Liabilities

Total gain included in earnings

663,000

The following table provides quantitative information about measurements categorized within Level 3 of the fair value hierarchy:

Fair Value at

June 30,

Valuation

Description

2014

Technique

Unobservable Input

Value

Warrant and Option derivative liabilities

270,999

Black Scholes Model

Expected volatility of the Company's common stock

65% - 90%

For the three and six months ended June 30, 2014 the Company recognized a gain of $389,771 and $676,800, respectively, for the changes in the valuation of derivative liabilities. For the three and six months ended June 30, 2013 the Company recognized a gain of $57,713 and $224,646, respectively, for the changes in the valuation of derivative liabilities.

The Company did not identify any non-recurring assets and liabilities that were recorded at fair value during the periods presented.

Revenue Recognition and Deferred Revenue — The Company’s revenues are primarily generated from license and research agreements with collaborators. Licensing revenue is recognized on a straight-line basis over the shorter of the life of the license or the estimated economic life of the patents related to the license.

License fee revenue begins to be recognized in the first full month following the effective date of the license agreement. Deferred revenue represents the portion of the license and other payments received that has not been earned. Costs associated with the license revenue are deferred and recognized over the same term as the revenue. Reimbursements of research expense pursuant to grants are recorded in the period during which collection of the reimbursement becomes assured, because the reimbursements are subject to approval.

In some cases, the Company is entitled to receive royalty payments from licensees. In such cases, the Company recognizes the royalties when they are earned and collectability of those royalty payments is reasonably assured.

In connection with its license agreements, the Company recorded $39,469 and $78,937 in license fee revenue for the three and six months ended June 30, 2014, respectively, in its consolidated statements of operations, and recorded $58,268 and $146,049 in license fee revenue for the three and six months ended June 30, 2013, respectively.

The remainder of the license fees have been accrued in deferred revenue at June 30, 2014 and December 31, 2013, respectively.

Research and Development Costs — Research and development costs consist of expenditures for the research and development of patents and technology, which cannot be capitalized. The Company’s research and development costs consist mainly of payroll and payroll related expenses, research supplies and research grants. Reimbursements of research expense pursuant to grants are recorded in the period during which collection of the reimbursement becomes assured, because the reimbursements are subject to approval. Research and development costs are expensed as incurred.

Share-Based Compensation — The Company records stock-based compensation in accordance with ASC 718, “Compensation – Stock Compensation.” ASC 718 requires companies to measure compensation cost for stock-based employee compensation at fair value at the grant date and recognize the expense over the employee’s requisite service period. The Company recognizes in the statement of operations the grant-date fair value of stock options and other equity-based compensation issued to employees and non-employees. There were 125,658,698 options outstanding as of June 30, 2014.

Income Taxes — Deferred income taxes are provided using the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards, and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of the changes in tax laws and rates of the date of enactment.

When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. The benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above is reflected as a liability for unrecognized tax benefits in the balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination.

Applicable interest and penalties associated with unrecognized tax benefits are classified as additional income taxes in the statements of operations.

Net Loss Per Share — Earnings per share is calculated in accordance with the ASC 260-10, “Earnings Per Share.” Basic earnings-per-share is based upon the weighted average number of common shares outstanding. Diluted earnings-per-share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period.

At June 30, 2014 and 2013, approximately 133,035,654 and 168,401,502 potentially dilutive shares, respectively, were excluded from the shares used to calculate diluted earnings per share as their inclusion would be anti-dilutive.

Concentrations and Other Risks — Currently, the Company’s revenues are concentrated on a small number of license agreements with customers. Revenues are based on amortizing funds already received over contractual terms of agreements. Based on the insignificance of these revenues to the Company’s operations and the nature of the agreements, any concentration of revenue among a small number of customers does not result in a risk to the Company.

Other risks include the uncertainty of the regulatory environment and the effect of future regulations on the Company’s business activities. As the Company is a biotechnology research and development company, there is also the attendant risk that someone could commence legal proceedings over the Company’s discoveries.

Recent Accounting Pronouncements - During the quarter ended June 30, 2014, the Financial Accounting Standards Board (FASB) issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes all existing revenue recognition requirements, including most industry-specific guidance. The new standard requires a company to recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration that the company expects to receive for those goods or services. The new standard will be effective for the Company on January 1, 2017. The Company is currently evaluating the potential impact that Topic 606 may have on its financial position and results of operations.

In July 2013, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (ASU 2013-11). ASU 2013-11 clarifies guidance and eliminates diversity in practice on the presentation of unrecognized tax benefits when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists at the reporting date. This new guidance is effective on a prospective basis for fiscal years and interim reporting periods within those years, beginning after December 15, 2013. The adoption of ASU 2013-11 is not expected to have a material impact on consolidated results of operations, financial condition, or liquidity.

In February 2013, the FASB issued ASU No. 2013-02, Comprehensive Income (Topic 220) – Reporting of Amounts Reclassified out of Accumulative Other Comprehensive Income (ASU 2013-02), which replaces the presentation requirements for reclassifications out of accumulated other comprehensive income in ASU 2011-05 and ASU 2011-12. ASU 2013-02 requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component and to present significant amounts reclassified out of accumulated other comprehensive income by respective line items of net income if the amount reclassified is required to be reclassified to net income in its entirety. The adoption of this standard is not expected to have a material impact on consolidated results of operations, financial condition, or liquidity.

4_INVESTMENT_IN_JOINT_VENTURE

4. INVESTMENT IN JOINT VENTURE	6 Months Ended
4. INVESTMENT IN JOINT VENTURE	Jun. 30, 2014
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]	'
4. INVESTMENT IN JOINT VENTURE	'
	On December 1, 2008, the Company and CHA Bio & Diostech Co., Ltd. (“CHA”), formed an international joint venture. The new company, Stem Cell & Regenerative Medicine International, Inc. (“SCRMI”), will develop human blood cells and other clinical therapies based on the Company’s hemangioblast program, one of the Company’s core technologies. Under the terms of the agreement, the Company purchased upfront a 33% interest in the joint venture, and will receive another 7% interest upon fulfilling certain obligations under the agreement over a period of 3 years. The Company’s contribution includes (a) the uninterrupted use of a portion of its leased facility at the Company’s expense, (b) the uninterrupted use of certain equipment in the leased facility, and (c) the release of certain of the Company’s research and science personnel to be employed by the joint venture. In return, for a 60% interest, CHA has agreed to contribute $150,000 cash and to fund all operational costs in order to conduct the hemangioblast program. Effective May 1, 2010, the Company was no longer obligated to provide laboratory space to SCRMI. As of June 30, 2014, the Company holds a 40% interest in the joint venture and CHA owns a 60% interest. The two partners to the joint venture are in negotiations on further funding of the joint venture, but there can be no assurances that an agreement will be reached. Any financial statement impact at this time is unclear should an agreement not be reached.

	The Company has agreed to collaborate with the joint venture in securing grants to further research and development of its technology. Additionally, SCRMI has agreed to pay the Company a fee of $500,000 for an exclusive, worldwide license to the Hemangioblast Program. The Company recorded $7,353 and $14,706 in license fee revenue for the three and six months ended June 30, 2014, respectively, and $7,353 and $14,706 in license fee revenue for the three and six months ended June 30, 2013, respectively, in the consolidated statements of operations, and the balance of unamortized license fee of $337,010 and $351,715 is included in deferred revenue in the accompanying consolidated balance sheets at June 30, 2014 and December 31, 2013, respectively.

	On July 15, 2011, the Company and CHA entered into a binding term sheet, with the expectation of entering into a future definitive agreement, in which the joint venture was realigned around both product development rights and research responsibilities. Under the terms of the binding term sheet, SCRMI exclusively licensed the rights to the Hemangioblast Program to the Company for United States and Canada and expanded the jurisdictional scope of the license to CHA to include Japan (in addition to South Korea, which was already exclusively licensed to CHA). As part of the agreement, the scientists at SCRMI involved in the Hemangioblast Program were transferred to the Company, and SCRMI discontinued its research activity and became solely a licensing entity. The Company is obligated to meet a minimal research spending requirement of $6.75 million by July 31, 2014 in order to maintain its exclusive license, up to the point of filing an investigational new drug for a therapeutic product. Intellectual property rights created by the Company in the course of its research are subject to a non-exclusive license to CHA for Japan and South Korea, and to SCRMI to be sub-licensable under certain circumstances for countries other than the United States, Canada, Japan and South Korea. Pursuant to the agreement, the Company paid $820,000 to SCRMI which is recorded to “losses attributable to equity method investments.” By filing the investigational new animal drug application on September 12, 2013 with the Federal Drug Administration, the Company has met the commitment required to maintain its exclusive license.

	The following table is a summary of key financial data for the joint venture as of and for the six months ended June 30, 2014 and 2013:

		June 30,
		2014		2013
	Current assets	$	257,400	$	191,544
	Noncurrent assets		1,298,307		1,245,289
	Current liabilities		292,116		294,165
	Noncurrent liabilities		1,729,495		2,021,611
	Net revenue		146,058		146,058
	Net income (loss)	$	101,095	$	84,638

5_PROPERTY_AND_EQUIPMENT

5. PROPERTY AND EQUIPMENT	6 Months Ended
5. PROPERTY AND EQUIPMENT	Jun. 30, 2014
Property, Plant and Equipment [Abstract]	'
5. PROPERTY AND EQUIPMENT	'
	Property and equipment consisted of the following at June 30, 2014 and December 31, 2013:

			June 30,			December 31,
			2014			2013
	Machinery & equipment (1)		$	1,135,385		$	1,086,800
	Computer equipment			64,967			49,707
	Office furniture			49,560			38,783
	Leasehold improvements (1)			604,732			559,969
				1,854,644			1,735,259

	Accumulated depreciation			(1,046,025	)		(981,683	)
	Property and equipment, net		$	808,619		$	753,576

	-1	The June 30, 2014 balances include approximately $133,038 in machinery & equipment and $366,223 in leasehold improvements that were not yet placed in service at June 30, 2014 and therefore had not started being depreciated as of that date.

	Depreciation expense for the three and six months ended June 30, 2014 amounted to $33,382 and $64,342, respectively. Depreciation expense for the three and six months ended June 30, 2013 amounted to $19,850 and $37,702, respectively.

6_ACCRUED_SETTLEMENT

6. ACCRUED SETTLEMENT	6 Months Ended
	Jun. 30, 2014
Accrued Settlement	'
6. ACCRUED SETTLEMENT	'
	The accrued settlement is comprised of the following at June 30, 2014 and December 31, 2013:

		June 30,		December 31,
		2014		2013
	SEC Civil Action	$	2,724,411	$	4,086,619
	SEC Section 16 Investigation		375,000		–
	Total	$	3,099,411	$	4,086,619

	SEC Civil Action

	In May 2012, the Company was named as a defendant in a civil action brought by the Securities and Exchange Commission related to transactions involving the sale and issuance of the Company’s securities. The Securities and Exchange Commission alleges that Company violated Section 5(a) and 5(c) of the Securities Act of 1933 because certain sales of shares to outside organizations, completed in late 2008 and early 2009 under the Company’s former management, resulted in $3.5 million in proceeds to the Company, were neither registered under the Securities act nor subject to an exemption from registration under Section 3(a)(10) of the Securities Act of 1933, as amended. In addition, the Company is alleged to have violated Section 13(a) of the Exchange Act of 1934 because the Company did not disclose the sale and issuance of the shares to the Securities and Exchange Commission on a timely basis.

	In December 2013, the Company settled the civil action. Under the terms of the settlement accepted by the SEC, the Company consented to entry of judgment under which it neither admits nor denies liability and has agreed to disgorgement of $3.5 million in proceeds from the transactions in question. In addition, the Company will pay approximately $587,000 in pre-judgment interest. The total amount due, approximately $4.1 million, will be paid over six equal quarterly installments. The first installment was placed into escrow in July 2013 and was applied to the aggregate amount due upon the acceptance by the SEC of the settlement agreement. The next installment was due and paid in April 2014 and the most recent payment was due and paid in July 2014. In addition, the settlement permanently restrains and enjoins the Company from violations of Sections 5(a) and 5(c) of the Securities Act, Section 13(a) of the Exchange Act and Rule 13a-11 under the Exchange Act.

	SEC Section 16 Investigation

	In April 2013, it was determined that Gary Rabin, our former Chief Executive Officer, failed to report 27 transactions in which Mr. Rabin sold shares of the Company’s common stock that took place between February 7, 2011 and January 10, 2013. The Company was advised that the SEC was investigating transactions involving sales of shares of our common stock that the former Chief Executive Officer failed to report in a timely manner on Form 4 under Section 16 of the Exchange Act. The Company has discussed a resolution to the matter with the SEC and has recorded the $375,000 as the expected settlement amount.

7_CONVERTIBLE_PROMISSORY_NOTES

7. CONVERTIBLE PROMISSORY NOTES	6 Months Ended
7. CONVERTIBLE PROMISSORY NOTES	Jun. 30, 2014
Convertible Promissory Notes	'
7. CONVERTIBLE PROMISSORY NOTES	'
	CAMOFI Senior Secured Convertible Debentures

	On January 11, 2013 the Company entered into a settlement agreement and mutual release (“the Settlement Agreement”) with CAMOFI Master LDC (“CAMOFI”) and CAMZHN Master LDC (“CAMHZN” and together with CAMOFI, the “CAMOFI Parties”), relating to the lawsuit between the Settling Parties, as plantiffs, and the Company, as defendant, in the Supreme Court of New York. Pursuant to the Settlement Agreement the Company issued Debentures in the principal amount of $4,732,781 and $1,267,219 to CAMOFI and CAMHZN, respectively (together the “Debentures”).

	The Debentures have an effective date of December 31, 2012, accrue interest at the rate of 8% per annum and mature on June 30, 2015. The Company may pre-pay all or a portion of the amounts due under the Debentures prior to maturity without penalty. Both of the Debentures are convertible at the option of the holder at a price per share of common stock equal to 80% of VWAP of the ten consecutive trading days prior to the conversion date. The Company must make quarterly payments under the Debentures on the last day of each calendar quarter commencing on March 31, 2013 in the amount of $600,000. The quarterly payments may, at the option of the Company and subject to the satisfaction of certain conditions, be paid in shares of Common Stock. In such case, the conversion price for such payment will be based on the lesser of (i) the conversion price as defined in the agreement or (ii) 80% of the average of the 10 closing prices immediately prior to the date the quarterly payment is due. To secure its obligations under the Debentures, the Company granted a security interest in substantially all of the Company’s assets, including its intellectual property, to the CAMOFI Parties. The Debentures contain certain covenants customary for debt instruments of its kind.

	On April 29, 2014, the Company received an Acceleration Notice from the CAMOFI Parties of a declaration that the aggregate principal amount remaining under the Debentures due June 30, 2015 issued by the Company and held by each of CAMOFI Parties subject to adjustment as set forth therein, together with any other amounts owed under the Debentures were immediately due and payable in accordance with their terms. The Acceleration Notice followed the delivery of a notice to the Company on April 15, 2014 stating that, due to the Company’s failure to deliver shares of common stock issuable to the CAMOFI Parties within three days of a conversion event, an “Event of Default” had occurred and the CAMOFI Parties were reserving all rights held by them arising from such Event of Default. At the time of the conversion event, the Company determined not to deliver the shares to the CAMOFI Parties in order to comply with applicable securities laws. The Company later delivered the shares to the CAMOFI Parties in compliance with applicable securities laws, prior to the delivery of the Default Notice.

	On May 2, 2014 the Company paid to the CAMOFI Parties an aggregate amount of approximately $1,616,000 calculated in accordance with the payment acceleration provisions of the Debentures and satisfying the Company’s obligations under the Debentures. The payment represented the remaining $1,200,000 in principal Debentures due and an additional amount of approximately $416,000, which represented penalties, interest and legal cost reimbursement to the CAMOFI Parties. With the payment, the Company satisfied in full its obligations under the Debentures and the terms of the Settlement Agreement and Mutual Release dated as of December 31, 2012 pursuant to which the Debentures were issued in January 2013. The Company received correspondence from the CAMOFI Parties stating that they believe the aggregate amount due to be different than the amount the Company paid. The Company believes that its interpretation of the Debentures is accurate and complete.

	The Debentures had contained an embedded beneficial conversion feature as the Debentures are convertible at a price per share of common stock equal to 80% of VWAP of the ten consecutive trading days prior to the conversion date. The embedded beneficial conversion feature was modeled using a binomial lattice model, and had a calculated value at December 31, 2013 of $663,000. The Company recorded a gain of $663,000 for the change in the fair value of the embedded conversion option liability for the six months ended June 30, 2014 as the derivative was recorded at $0 at June 30, 2014 with the retirement of the remaining debentures.

	The Company recorded a debt discount of $725,000, which was to be amortized over the life of the note using the effective interest rate of 22.9%. The unamortized discount balance of $108,229 was written off to interest expense with the retirement of the remaining outstanding debentures.

8_LOSS_CONTINGENCY_ACCRUAL

8. LOSS CONTINGENCY ACCRUAL	6 Months Ended
	Jun. 30, 2014
Commitments and Contingencies Disclosure [Abstract]	'
8. LOSS CONTINGENCY ACCRUAL	'
	The loss contingency accrual is comprised of the following at June 30, 2014 and December 31, 2013:

		June 30,		December 31,
		2014		2013
	Warrant holder litigation	$	–	$	6,228,621
	Miscellaneous settlements		221,581		203,358
	Total	$	221,581	$	6,431,979

	Warrant holder litigation

	On June 4, 2014, the Company entered into a settlement agreement (the “June 2014 Agreement”) with each of Gary D. Aronson (“Aronson”), John S. Gorton, individually and as trustee of the John S. Gorton Separate Property Trust dated March 3, 1993 (“Gorton”), herronlaw apc, attorneys for Aronson (“Herron”), Miller and Steele LLP, attorneys for Gorton (“Miller/Steele”) and Michael A. Bourke, attorney for both Aronson and Gorton (“Bourke”). The June 2014 Agreement relates to previously disclosed lawsuits filed against the Company by each of Aronson and Gorton in August 2011 in the United States District Court for the District of Massachusetts claiming that the Company breached an anti-dilution provision contained in warrants held by each of Aronson and Gorton as a result of certain transactions between the Company and other third-party investors.

	Pursuant to the settlement agreement, in exchange for dismissal of the lawsuit by the warrant holders, the Company issued 384,000,000 shares of its common stock. On the date of the settlement the shares were valued at $.0614 per share for a total value of $23,577,600. With the settlement the Company reversed the existing accruals recorded for warrant holder litigation under loss contingency as well as under the unsettled warrant obligation. As a result the Company recorded a loss on settlement of litigation of $11,567,009 and $13,468,547 for the three and six months ended June 30, 2014, respectively. (see Note 9).

	At December 31, 2013 the Company had determined that a loss was probable and the amount of loss was reasonably estimable, based on the facts and circumstances surrounding the litigation during the last quarter of 2013. The loss contingency represented the estimated number of shares to settle above a determined share amount necessary to settle the warrant share obligation plus an additional amount for potential interest charges.

	Miscellaneous settlements

	The Company was not able to reach settlement agreements with all of holders of convertible promissory notes and warrants that were issued between 2005 and 2010. The Company has not been contacted by the remaining holders nor has it been able to reach them for potential settlement discussions. If the Company is able to negotiate with the holders it anticipates that the number of shares to be issued will be similar to the settlements that have already been finalized as of December 31, 2012.

9_UNSETTLED_WARRANT_OBLIGATION

9. UNSETTLED WARRANT OBLIGATION	6 Months Ended
9. UNSETTLED WARRANT OBLIGATION	Jun. 30, 2014
Unsettled Warrant Obligation	'
9. UNSETTLED WARRANT OBLIGATION	'
	The Company determined that it had an unsettled warrant obligation related to two warrant agreements entered into in 2005. The warrant agreement had anti-dilution ratchet provisions which the Company determined led to a contractual obligation, which became fixed on January 15, 2009, to issue approximately 63.2 million common shares. The Company further determined that those common shares represent a liability which should be recorded at fair value at each accounting period with changes to that fair value being recorded in earnings. Fair value is based on the share obligation multiplied by the stock price at the end of each reporting period, with a liability “floor” established, at $0.06 per share, based on the stock price at the time the ratchet provision was triggered. At December 31, 2013 the liability has been recorded at $3,899,391.

	In June 2014, the warrant holder litigation with Aronson and Gorton was settled as the Company entered into a settlement agreement with the parties, thus eliminating the unsettled warrant obligation accrual at June 30, 2014 (see Note 8). The Company conducted a final valuation of the 63.2 million shares of unsettled warrant obligation on the day of settlement, June 4, 2014, and the liability was adjusted to $3,880,431 before being adjusted for the settlement. As a result of this final valuation the Company recorded $1,004,867 through earnings during the three months ended June 30, 2014.

10_SERIES_B_PREFERRED_STOCK

10. SERIES B PREFERRED STOCK	6 Months Ended
10. SERIES B PREFERRED STOCK	Jun. 30, 2014
SeriesBPreferredStockAbstract	'
10. SERIES B PREFERRED STOCK	'
	On November 2, 2009 (“Effective Date”), the Company entered into a preferred stock purchase agreement with Optimus Life Sciences Capital Partners, LLC (“Investor” or “Optimus”). Pursuant to the purchase agreement, the Company agreed to sell, and the Investor agreed to purchase, in one or more purchases from time to time at the Company’s sole discretion, (i) up to 1,000 shares of Series B preferred stock at a purchase price of $10,000 per share, for an aggregate purchase price of up to $10,000,000, and (ii) five-year warrants to purchase shares of the Company’s common stock with an aggregate exercise price equal to 135% of the purchase price paid by the Investor, at an exercise price per share as follows:

	On the sixth (6th) trading day following the tranche notice date, the exercise price of the Optimus warrant shall be adjusted to equal the VWAP for the 5 trading days beginning on and including the tranche notice date (as so adjusted, the “Adjusted Exercise Price”); and

	If the Adjusted Exercise Price results in additional Warrant Shares being issuable to the Holder, such additional shares shall be delivered to the Holder within one Trading Day following the Adjustment Date. If the Adjusted Exercise Price results in less Warrant Shares being issuable to the Holder, the excess Warrant Shares shall be returned by the Holder to the Company within one Trading Day following on the Adjustment Date.

	The Company agreed to pay to the Investor a commitment fee of $500,000, at the earlier of the closing of the first Tranche or the six month anniversary of the effective date, payable at the Company’s election in cash or common stock valued at 90% of the volume weighted average price of the Company’s common stock on the five trading days preceding the payment date. The $500,000 commitment fee was outstanding and was recorded in accrued expenses in the Company’s consolidated balance sheet at December 31, 2009. During 2010, the Company issued 50 shares of preferred stock as payment for the commitment fee.

	During 2010, the Company delivered tranche notices to Optimus Life Sciences Capital Partners, LLC for delivery of a total of 1,000 shares under the Series B preferred stock for funding in the amount of $10,000,000 ($9,485,000 in cash proceeds, $500,000 of commitment fee applied, and $15,000 in legal fees).

	During 2010, in connection with the funding, the Company issued 95,870,362 shares of its common stock upon exercise of the same number of warrants, which were granted simultaneously with the Company’s tranche notices. During 2010, the Company received secured promissory notes in the amount of $13,500,000 to settle the warrant exercise.

	Dividends

	Commencing on the date of the issuance of any shares of Series B preferred stock, Holders of Series B preferred stock will be entitled to receive dividends on each outstanding share of Series B preferred stock, which will accrue in shares of Series B preferred stock at a rate equal to 10% per annum from the issuance date compounded annually. Accrued dividends will be payable upon redemption of the Series B preferred stock. Accrued dividends were $2,980,258 and $3,587,748 at June 30, 2014 and December 31, 2013, respectively.

	Redemption Rights

	Upon or after the fourth anniversary of the initial issuance date, the Company will have the right, at the Company’s option, to redeem all or a portion of the shares of the Series B preferred stock, at a price per share equal to 100% of the Series B liquidation value. The preferred stock may be redeemed at the Company’s option, commencing 4 years from the issuance date at a price per share of (a) $10,000 per share plus accrued but unpaid dividends (the “Series B Liquidation Value”), or, at a price per share of: (x) 127% of the Series B Liquidation Value if redeemed on or after the first anniversary but prior to the second anniversary of the initial issuance date, (y) 118% of the Series B Liquidation Value if redeemed on or after the second anniversary but prior to the third anniversary of the initial issuance date, and (z) 109% of the Series B Liquidation Value if redeemed on or after the third anniversary but prior to the fourth anniversary of the initial issuance date.

	Liquidation Rights

	The preferred shares shall, with respect to dividend, rights upon liquidation, winding-up or dissolution, rank: (i) senior to the Company’s common stock, and any other class or series of preferred stock of the Company, except Series A-1 Convertible Preferred Stock which shall rank senior in right of liquidation and pari passu with respect to dividends; and (ii) junior to all existing and future indebtedness of the Company.

	If the Company determines to liquidate, dissolve or wind-up its business, it must redeem the Series B preferred stock at the prices set forth above. Upon any liquidation, dissolution or winding up of the Company the Holders of Series B preferred stock shall be first entitled to be paid out of the assets of the Company available for distribution to its stockholders an amount with respect to each share of Series B preferred stock equal to $10,000, plus any accrued and unpaid dividends.

	The Company has classified the Series B redeemable preferred stock in the equity section in its consolidated balance sheets.

	Related Secured Promissory Notes Receivable:

	In accordance with the terms of the Series B preferred stock agreement, Optimus issued to the Company a secured promissory note in consideration for receiving and exercising warrants under each tranche. The value of each secured promissory note equals the value of the warrants that Optimus received. Interest on the notes accrues at 2% per year, compounding annually if the interest remains unpaid at the end of each year. The note is secured by freely tradable marketable securities belonging to Optimus. Each promissory note matures on the fourth anniversary of its issuance.

	In the event the Company redeems all or a portion of any shares of Series B preferred stock held by Optimus, the Company will be permitted to offset the full amount of such proceeds against amounts outstanding under the promissory notes. Accordingly, the Company included the discounted value of the secured promissory notes as a separate component of stockholders’ deficit at June 30, 2014 and December 31, 2013.

	June 2014 Redemption

	In June 2014 the Company redeemed 250 shares of the Series B preferred, all of which were upon or after the fourth anniversary of their initial issuance date, representing three separate tranches. As part of the redemption, the promissory notes receivable balances for these tranches were netted against the accrued dividends payable, with the net dividend payable balance of $70,129 being paid out in cash and a charge being recorded to stockholders equity.

	The value of the secured promissory notes in the consolidated balance sheet was $10,448,835, net of discounts of $403,049 and accrued interest of $726,884 at June 30, 2014, reflecting a face value of $10,125,000. The value of the secured promissory notes in the consolidated balance sheet was $13,561,607, net of discounts of $654,559 and accrued interest of $716,166 at December 31, 2013, reflecting a face value of $13,500,000. The Company determined that a 10% discount is appropriate, in order to consistently reflect the Company’s cost of borrowing under the terms of the underlying Series B preferred stock that permits offset. The Company recorded an initial discount on the promissory notes in the amount of $3,519,238 during the year ended December 31, 2010. The Company accretes interest at 10% over the respective four-year terms of the promissory notes.

	During the three and six months ended June 30, 2014 the Company accreted interest on the promissory notes in the amount of $298,006 and $556,170, respectively, and during the three and six months ended June 30, 2013, the Company accreted interest on the promissory notes in the amount of $312,116 and $601,958, respectively, which was recorded in accumulated deficit during the periods then ended. The Company recorded dividends on its Series B preferred stock during the three and six months ended June 30, 2014 of $297,448 and $631,581 respectively and during the three and six months ended June 30, 2013 of $312,718 and $603,119, respectively. The accrued dividends are offset by the accretion of the note receivable discount.

	As of June 30, 2014 and December 31, 2013, 750 and 1,000 shares of Series B preferred stock, respectively, were outstanding. As of June 30, 2014, the Company has drawn the entire commitment of $10,000,000.

11_SERIES_C_PREFERRED_STOCK

11. SERIES C PREFERRED STOCK	6 Months Ended
	Jun. 30, 2014
SeriesCPreferredStockAbstract	'
11. SERIES C PREFERRED STOCK	'
	On December 30, 2010 (the “Series C Effective Date”), the Company entered into a securities purchase agreement (the “Series C Purchase Agreement”) with Socius CG II, Ltd., a Bermuda exempted company (“Socius”). Pursuant to the Series C Purchase Agreement:

		·	The Company agreed to sell, and Socius agreed to purchase, in one or more purchases from time to time (each such purchase, a “Series C Tranche”) in the Company’s sole discretion (subject to the conditions set forth therein), (i) up to 2,500 shares of Series C preferred stock at a purchase price of $10,000 per share, for an aggregate purchase price of up to $25,000,000, and (ii) a two-year warrant (the “Socius Warrant”) obligating Socius to purchase shares of the Company’s common stock with an aggregate exercise price equal to 20% of the purchase price paid by Socius for the Series C preferred stock sold in each Series C Tranche, at an exercise price per share equal to the closing bid price of the Company’s common stock on the date the Company provides notice of such Series C Tranche (the “Series C Tranche Notice”). On each date that the Company delivers a Series C Tranche Notice to Socius, Socius shall also become obligated, pursuant to a right automatically vesting on such Series C Tranche Notice date, to purchase that number of shares of common stock (such shares of common stock, the “Additional Investment Shares”) equal in dollar amount to 100% of the Series C Tranche amount set forth in the Series C Tranche Notice at a price per share equal to the closing bid price of the Company’s common stock on the Series C Tranche Notice date.

		·	The Series C Purchase Agreement requires that, when the Company requests Socius to purchase a tranche of Series C preferred stock, the mandatory purchase by Socius of the related Additional Investment Shares must occur no later than sixty (60) calendar days following the Series C Tranche Notice date.

		·	The Socius Warrant was issued to Socius on December 30, 2010 (the “Closing Date”) simultaneous with entering into the Series C Purchase Agreement. The Socius Warrant was issued with an initial exercise price per warrant of $0.16 per share and for a total of up to 31,250,000 shares, subject to adjustment as described therein. On January 10, 2011, Socius and the Company entered into a letter agreement in which the parties agreed that, following arms-length negotiations and notwithstanding anything to the contrary in the Socius Warrant, that the initial number of shares issuable under the Socius Warrant, subject to the adjustment mechanism set forth therein, was equal to 30,000,000.

		·	As required by the Series C Purchase Agreement, the Socius Warrant must be exercised for such number of shares of common stock equal in amount to 20% of the cumulative purchase price paid by Socius for the Series C preferred stock. The maximum amount of Series C preferred stock that Socius may become obligated to purchase under all Series C Tranches is $25,000,000. Assuming the maximum drawdown of $25,000,000 by the Company under the Series C Purchase Agreement, Socius would be required to exercise the Socius Warrant to purchase 20% of this total dollar amount, or $5,000,000 worth of the Company’s common stock.

		·	The letter agreement entered into on January 10, 2011, modified the Socius Warrant only with respect to the initial number of underlying shares and expressly provides that, except as so modified, the Socius Warrant shall remain unchanged and shall continue in full force and effect.

		·	At the initial closing pursuant to the Series C Purchase Agreement, which occurred on the Closing Date, (i) Socius purchased 400 shares of Series C preferred stock and the Company received gross proceeds of $4,000,000. (ii) the Company delivered to Socius an initial warrant (the “Initial Warrant”) obligating Socius to purchase shares of its common stock with an aggregate purchase price of $800,000, which shall be automatically exercisable on the date a registration statement for the resale of all shares of common stock issuable pursuant to the Series C Purchase Agreement is declared effective (which effectiveness occurred on April 13, 2011), with delivery of such shares made to Socius on the trading day immediately following the exercise date at a per-share price equal to the closing bid price of the Company’s common stock on the delivery date, and (iii) Socius became obligated to purchase additional shares of common stock equal in aggregate dollar amount to $4,000,000 (such shares of common stock the “Initial Investment Shares”), with delivery of such shares made to Socius on the trading day immediately following the date the registration statement is declared effective at a price per share equal to the closing bid price of the Company’s common stock on the delivery date.

		·	The Company agreed to pay to Socius a commitment fee of $1,250,000 (the “Commitment Fee”), at the earlier of the closing of the first Series C Tranche or the six month anniversary of the Series C Effective Date. This Commitment Fee is payable solely at the Company’s election, in cash or in the alternative, in shares of common stock valued at 88% of the volume weighted average price of the Company’s common stock on the 5 trading days preceding the payment date. If the Company elects to pay the Commitment Fee in shares of its common stock, no cash payment would be due as the issuance of shares would satisfy the Commitment Fee obligation in full. The Company issued 7,562,008 shares of its common stock on September 30, 2011 as full payment of the commitment fee.

		·	The Company agreed to use its best efforts to file within 60 days of the Series C Effective Date, and cause to become effective as soon as possible thereafter, a registration statement with the Securities and Exchange Commission for the resale of all shares of common stock issuable pursuant to the Series C Purchase Agreement, including the shares of common stock underlying the Socius Warrant, shares of the common stock issuable upon exercise of the Initial Warrant, shares of common stock issuable as Initial Investment Shares, shares of common stock issuable as Additional Investment Shares, and shares of common stock issuable in payment of the Commitment Fee.

		·	In the event that Socius does not comply with its obligations under the Series C Purchase Agreement (including its obligations to exercise the Socius Warrant), the Series C Purchase Agreement provides that, in addition to being entitled to exercise all rights provided therein or granted by law, the Company would be entitled to seek specific performance by Socius under the Series C Purchase Agreement and the Socius Warrant.

	On December 30, 2010, in accordance with the Series C Purchase Agreement, the Company filed a certificate of designations for the Series C preferred stock with the Secretary of State of the State of Delaware. As previously reported, pursuant to the certificate of designations, the Series C preferred stock shall, with respect to dividend, rights upon liquidation, winding-up or dissolution, rank: (i) senior to the Company’s common stock, and any other class or series of preferred stock of the Company (collectively, with any warrants, rights, calls or options exercisable for or convertible into such preferred stock, the “Junior Securities”); provided, however, the Series A-1 redeemable convertible preferred stock and Series B preferred stock (together, the “Senior Securities”) shall rank senior in right of redemption, liquidation, and dividends; and (ii) junior to all existing and future indebtedness of the Company.

	As of June 30, 2014 and December 31, 2013, the Company had drawn $17,500,000 of the $25,000,000 commitment.

	Dividends

	Commencing on the date of the issuance of any shares of Series C preferred stock, holders of Series C preferred stock will be entitled to receive dividends on each outstanding share of Series C preferred stock, which will accrue in shares of Series C preferred stock at a rate equal to 6% per annum from the issuance date compounded annually. Accrued dividends will be payable upon redemption of the Series C preferred stock. Accrued dividends were $3,040,267 and $2,454,853 at June 30, 2014 and December 31, 2013, respectively.

	Redemption Rights

	Upon or after the fourth anniversary of the initial issuance date, the Company will have the right, at the Company’s option, to redeem all or a portion of the shares of the Series C preferred stock, at a price per share equal to 100% of the Series C liquidation value. The Series C preferred stock may be redeemed at the Company’s option, commencing 4 years from the issuance date at a price per share of (a) $10,000 per share plus accrued but unpaid dividends (the “Series C Liquidation Value”), or, at a price per share of : (i) 136% of the Series C Liquidation Value if redeemed prior to the first anniversary of the initial issuance date, (ii) 127% of the Series C Liquidation Value if redeemed on or after the first anniversary but prior to the second anniversary of the initial issuance date, (iii) 118% of the Series C Liquidation Value if redeemed on or after the second anniversary but prior to the third anniversary of the initial issuance date, and (iv) 109% of the Series C Liquidation Value if redeemed on or after the third anniversary but prior to the fourth anniversary of the initial issuance date.

	Termination and Liquidation Rights

	If the Company determines to liquidate, dissolve or wind-up its business, it must redeem the Series C preferred stock at the prices set forth above. Upon any liquidation, dissolution or winding up of the Company, the holders of Series C preferred stock shall be first entitled to be paid out of the assets of the Company available for distribution to its stockholders an amount with respect to each share of Series C preferred stock equal to $10,000, plus any accrued and unpaid dividends.

	Related Secured Promissory Notes Receivable:

	As of June 30, 2014, Socius has issued $21,000,000 in notes receivable in accordance with the terms of the Series C Purchase Agreement. Interest on the notes accrues at 2% per year, compounding annually if the interest remains unpaid at the end of each year. The notes are secured by freely tradable marketable securities belonging to Socius. Each promissory note matures on the fourth anniversary of its issuance.

	In the event the Company redeems all or a portion of any shares of Series C preferred stock held by Socius, the Company will be permitted to offset the full amount of such proceeds against amounts outstanding under the promissory notes. Accordingly, the Company included the discounted value of the secured promissory notes as a separate component of stockholders’ deficit at June 30, 2014 and December 31, 2013.

	At June 30, 2014, the value of the secured promissory notes in the consolidated balance sheet was $21,049,355, net of discounts of $965,383 and accrued interest of $1,014,738, reflecting a face value of $21,000,000.

	At December 31, 2013, the value of the secured promissory notes in the consolidated balance sheet was $20,451,788, net of discounts of $1,363,762 and accrued interest of $815,549, reflecting a face value of $21,000,000.

	The Company determined that a 6% discount is appropriate, in order to consistently reflect the Company’s cost of borrowing under the terms of the underlying Series C preferred stock that permits offset. The Company recorded an initial discount on the promissory notes in the amount of $1,968,050 during the year ended December 31, 2011 and an additional $1,026,809 of debt discounts during the year ended December 31, 2012 related to the fifth, sixth and seventh tranche notice. The Company accretes interest at 6% over the respective four-year terms of the promissory notes.

	During the three and six months ended June 30 2014, the Company accreted interest on the promissory note in the amount of $303,641 and $597,568, respectively, and during the three and six months ended June 30, 2013 the Company accreted interest on the promissory note in the amount of $286,454 and $563,744, respectively, which was recorded in accumulated deficit during the periods then ended. The Company recorded dividends on its Series C preferred stock during the three and six months ended June 30, 2014, of $295,743 and $585,414, respectively and recorded dividends of $279,003 and $552,277 during the three and six months ended June 30, 2013, respectively. The accrued dividends are offset by the accretion of the note receivable discount.

	The Company has classified the Series C preferred stock in the equity section in its consolidated balance sheets. As of June 30, 2014 and December 31, 2013, 1,750 shares of Series C preferred stock were outstanding.

12_WARRANT_SUMMARY

12. WARRANT SUMMARY	6 Months Ended
12. WARRANT SUMMARY	Jun. 30, 2014
Warrants and Rights Note Disclosure [Abstract]	'
12. WARRANT SUMMARY	'
	Warrant Activity

	A summary of warrant activity for the six months ended June 30, 2014 is presented below:

										Weighted
							Weighted			Average		Aggregate
							Average			Remaining		Intrinsic
			Number of				Exercise			Contractual		Value
			Warrants				Price $			Life (in years)		(000)$
	Outstanding, December 31, 2013			7,829,883				0.28			1.82		–
	Granted			–				–
	Exercised			–				–
	Forfeited/Canceled			(452,927	)			0.1
	Outstanding, June 30, 2014			7,376,956				0.29			1.41
	Exercisable, June 30, 2014			7,376,956				0.29			1.41		–

	The aggregate intrinsic value in the table above is before applicable income taxes and is calculated based on the difference between the exercise price of the warrants and the quoted price of the Company’s common stock as of the reporting date.

	The following table summarizes information about warrants outstanding and exercisable at June 30, 2014:

		Warrants Outstanding and Exercisable
						Weighted			Weighted
						Average			Average
	Exercise	Number				Remaining			Exercise
	Price $	of Shares				Life (Years)			Price $
	.10 - .11		2,786,320				0.5			0.1
	.20 - .30		1,630,000				1.5			0.25
	.38-.39		1,330,636				3.07			0.39
	.40-.45		815,000				1.5			0.45
	0.7		815,000				1.5			0.7
			7,376,956

13_STOCKHOLDERS_DEFICIT_TRANSA

13. STOCKHOLDERS' DEFICIT TRANSACTIONS	6 Months Ended
13. STOCKHOLDERS' DEFICIT TRANSACTIONS	Jun. 30, 2014
Equity [Abstract]	'
13. STOCKHOLDERS' EQUITY TRANSACTIONS	'
	On June 27, 2014, the Company entered into a purchase agreement with Lincoln Park Capital Fund, LLC (“Lincoln Park”) pursuant to which the Company has the right to sell to Lincoln Park up to $30,000,000 in shares of its common stock, subject to certain limitations set forth in the purchase agreement.

	On June 27, 2014, the Company and Lincoln Park also entered into a registration rights agreement, pursuant to which the Company is required to file a registration statement with the SEC to register the resale of the shares of common stock issued and issuable to Lincoln Park, pursuant to the purchase agreement.

	Upon the satisfaction of the conditions set forth in the purchase agreement, including the registration statement being declared effective by the SEC, the Company has the right over a 36-month period to sell up to an additional $30,000,000 million worth of shares of its Common Stock to Lincoln Park, upon the terms set forth in the purchase agreement. Pursuant to the purchase agreement, the purchase price of such common stock will be based on the prevailing market price of the Company’s common stock immediately preceding the time of sales, with the Company controlling the timing and amount of any future sales, if any, of common stock to Lincoln Park. There are no upper limits to the price Lincoln Park may pay to purchase the Company’s common stock. Lincoln Park shall not have the right or the obligation to purchase any shares of common stock on any business day that the closing price of the Company’s common stock is below a floor price as provided in the purchase agreement. The purchase price means, with respect to any regular purchase, the lower of: (i) the lowest sale price on the applicable purchase date and (ii) the arithmetic average of the three (3) lowest closing sale prices for the common stock during the ten (10) consecutive business days ending on the business day immediately preceding such purchase date (in each case, to be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split or other similar transaction that occurs on or after the date of this Agreement). However, the purchase price cannot be below $0.03.

	The purchase agreement contains customary representations, warranties, covenants, closing conditions and indemnification and termination provisions by, among and for the benefit of the parties. Lincoln Park has covenanted not to cause or engage in any manner whatsoever, any direct or indirect short selling or hedging of the Company’s common stock. The purchase agreement may be terminated by the Company at any time at its discretion without any cost to the Company. The proceeds received by the Company under the purchase agreement are expected to be used to fund the Company’s clinical activities.

	In consideration for entering into the purchase agreement, the Company issued to Lincoln Park 10,600,707 shares of its common stock as a commitment fee. The shares related to the commitment fee have been issued in reliance on an exemption from registration under the Securities Act of 1933, as amended pursuant to Section 4(a)(2) thereof and Regulation D promulgated thereunder, and will be registered for resale on the registration statement that the Company must file pursuant to the purchase agreement and the Registration Rights Agreement. The shares related to the commitment fee are fully earned as of the date of the agreement. There were no other considerations given to Lincoln Park for entering into this agreement with the Company.

	From January 1, 2014 to June 30, 2014, Lincoln Park purchased 226,974,958 shares of common stock for cash proceeds of $14,281,295.

	From January 27, 2014 to June 30, 2014, the Company issued an aggregate of 427,373,609 shares in settlements, including 384,000,000 shares in settlement of the Aronson-Gorton warrant holder litigation valued at $23,577,600 and 43,373,609 shares in settlement of $2,400,000 Debentures to the CAMOFI Parties as required by the Settlement Agreement.

	During the six months ended June 30, 2014, the Company issued various board members 1,972,826 shares of common stock valued at $142,734 as compensation for board services.

14_STOCKBASED_COMPENSATION

14. STOCK-BASED COMPENSATION	6 Months Ended
14. STOCK-BASED COMPENSATION	Jun. 30, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]	'
14. STOCK-BASED COMPENSATION	'
	Stock Plans

										Options/Shares
			Options/Shares				Options			Available			Total
	Stock Plan		Issued				Outstanding			For Grant			Authorized
	2004 Stock Plan			2,492,000				70,000			1,215,104			2,800,000
	2004 Stock Plan II			650,000				420,000			651,161			1,301,161
	2005 Stock Plan			158,079,319				125,168,698			423,759,464			581,838,783
				161,221,319				125,658,698			425,625,729			585,939,944

	Stock Option Activity

	A summary of option activity for the six months ended June 30, 2014 is presented below:

										Weighted
							Weighted			Average
							Average			Remaining			Aggregate
			Number of				Exercise			Contractual			Intrinsic
			Options				Price			Life (in years)			Value
	Outstanding, December 31, 2013			118,278,611			$	0.19			6.95		$	10,319
	Granted			16,075,000				0.08
	Exercised			–				–
	Forfeited/canceled			(8,694,913	)			0.31
	Outstanding, June 30, 2014			125,658,698				0.17			7.16			65,824

	Vested and expected to vest at June 30, 2014			122,815,109			$	0.17			7.1		$	63,642

	Exercisable, June 30, 2014			103,784,935			$	0.19			6.69		$	49,039

	The aggregate intrinsic value in the table above is before applicable income taxes and is calculated based on the difference between the exercise price of the options and the quoted price of the Company’s common stock as of the reporting date.

	The following table summarizes information about stock options outstanding and exercisable at June 30, 2014.

				Options Outstanding					Options Exercisable
						Weighted		Weighted			Weighted	Weighted
						Average		Average			Average	Average
		Exercise		Number		Exercise		Remaining	Number		Exercise	Remaining
		Price		of Shares		Price		Life (Years)	of Shares		Price	Life (Years)
	$	0.05 - 0.0799		23,305,714	$	0.07		9.05	14,251,547	$	0.07	9.02
		0.08 - 0.10		42,329,081		0.09		7.43	29,509,485		0.09	6.52
		0.101 - 0.157		20,250,000		0.15		6.96	20,250,000		0.15	6.96
		0.158 - 0.21		25,634,166		0.19		6.23	25,634,166		0.19	6.23
		0.22 - 0.45		10,420,000		0.37		6.74	10,420,000		0.37	6.74
		0.46 - 0.85		3,114,737		0.85		0.59	3,114,737		0.85	0.59
	$	0.86 - 2.48		605,000	$	2.02		1.38	605,000	$	2.02	1.38
				125,658,698					103,784,935

	The assumptions used in calculating the fair value of options granted using the Black-Scholes option- pricing model for options granted during the three months ended June 30, 2014 are as follows:

			June 30,		June 30,
			2014		2013
	Risk-free interest rate		0.02 – 2.27%		0.76 - 1.91%
	Expected life of the options		5.00 - 6.25 years		5.00 - 6.50 years
	Expected volatility		112 - 148%		160%
	Expected dividend yield		0%		0%
	Expected forfeitures		13%		13%

	The weighted average grant-date fair value for the options granted during the six months ended June 30, 2014 and 2013 was $0.0768 and $0.08, respectively.

	Stock-based compensation expense to employees for the three and six months ended June 30, 2014 was $219,611 and $566,206 and for the three and six months ended June 30, 2013 was $898,381and $2,031,005, respectively.

	The compensation expense related to the unvested options as of June 30, 2014, was $1,400,227 which will be recognized over the weighted average period of 2.81 years.

15_SUBSEQUENT_EVENTS

15. SUBSEQUENT EVENTS	6 Months Ended
15. SUBSEQUENT EVENTS	Jun. 30, 2014
Subsequent Events [Abstract]	'
15. SUBSEQUENT EVENTS	'
	On various dates from July 1, 2014 through August 4, 2014, Lincoln Park purchased 26,511,447 shares of common stock for cash proceeds to the Company of $1,852,618.

	On June 24, 2014, the Company issued a press release announcing that it had named Paul K. Wotton as its Chief Executive Officer. Dr. Wotton’s employment with the Company began on July 21, 2014.

	On August 7, 2014, the Company redeemed 750 shares of its Series B Preferred Stock and the associated outstanding dividends payable from Optimus Life Sciences Capital Partners, LLC, or Optimus, in exchange for (i) cancellation of the secured promissory notes and associated accrued interest of $10,874,257, issued to the Company by Optimus and (ii) $25,000 cash. Following this repurchase, the Company has zero shares of Series B Preferred Stock outstanding.

	On August 7, 2014, the Company redeemed 1,750 shares of its Series C Preferred Stock and the associated outstanding dividends payable from Socius CGIII, Ltd., or Socius, in exchange for (i) cancellation of the secured promissory notes and associated accrued interest of $22,186,899, issued to the Company by Socius and (ii) $25,000 cash. Following this repurchase, the Company has zero shares of Series C Preferred Stock outstanding.

3_SUMMARY_OF_SIGNIFICANT_ACCOU1

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Basis of Presentation

Principles of Consolidation

Segment Reporting

Use of Estimates

Cash and Cash Equivalents

Commitments and Contingencies

Grant Received

Grants Receivable

Property and Equipment

The Company provides for depreciation over the assets’ estimated useful lives as follows:

Machinery & equipment

4 years

Computer equipment

3 years

Office furniture

4 years

Leasehold improvements

Lesser of lease life or economic life

Capital leases

Lesser of lease life or economic life

Patents

Equity Method Investment

Deferred Costs

Deferred Costs — Consist of the following:

(c) Payments made to financial institutions and consulting firms in order to provide financing related services. These costs are being amortized over the terms of the related agreements.

Long-Lived Assets

Fair Value Measurements

Level 1 inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

Level 3 inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The Company uses Level 3 inputs for its valuation methodology for the fair value of certain embedded conversion options and warrant and option derivative liabilities.

At June 30, 2014, the Company identified the following assets and liabilities that are required to be presented on the balance sheet at fair value:

Description

Fair Value

Fair Value Measurements at

As of

30-Jun-14

Using Fair Value Hierarchy

Level 1

Level 2

Level 3

Warrant and option derivative liabilities

270,999

–

270,999

Total

270,999

–

270,999

The following tables reconcile the change in fair value for measurements categorized within Level 3 of the fair value hierarchy:

Warrant and Option Derivative Liabilities

Balance at December 31, 2013

284,799

Total (gains) for the period included in earnings

(13,800

)

Balance at June 30, 2014

270,999

Embedded Conversion Option Liabilities

Balance at December 31, 2013

663,000

Total (gains) for the period included in earnings

(663,000

)

Balance at June 30, 2014

–

Gains and losses included in earnings for the six months ended June 30, 2014 are reported as follows:

Warrant and Option Derivative Liabilities

Total gain included in earnings

13,800

Embedded Conversion Option Liabilities

Total gain included in earnings

663,000

The following table provides quantitative information about measurements categorized within Level 3 of the fair value hierarchy:

Fair Value at

June 30,

Valuation

Description

2014

Technique

Unobservable Input

Value

Warrant and Option derivative liabilities

270,999

Black Scholes Model

Expected volatility of the Company's common stock

65% - 90%

The Company did not identify any non-recurring assets and liabilities that were recorded at fair value during the periods presented.

Revenue Recognition and Deferred Revenue

The remainder of the license fees have been accrued in deferred revenue at June 30, 2014 and December 31, 2013, respectively.

Research and Development Costs

Share-Based Compensation

Income Taxes

Applicable interest and penalties associated with unrecognized tax benefits are classified as additional income taxes in the statements of operations.

Net Loss Per Share

Concentrations and Other Risks

Recent Accounting Pronouncements

2_RESTATEMENT_OF_PREVIOUSLY_IS1

2. RESTATEMENT OF PREVIOUSLY ISSUED CONSOLIDATED FINANCIAL STATEMENTS (Tables)	6 Months Ended
	Jun. 30, 2014
Accounting Changes and Error Corrections [Abstract]	'
Restated financial tables	'
	Summary of increases (decreases) in net loss (unaudited)

			Three months ended June 30, 2013				Six months ended June 30, 2013

	Net loss, as previously reported		$	(6,611,346	)		$	(13,024,387	)
	Net adjustments
	Research and development			(113,033	)			(219,592	)
	General and administrative expenses			(9,524	)			(17,529	)
	Adjustments to fair value of unsettled warrant obligation			(160,153	)			(143,185	)
	Net loss, restated		$	(6,894,056	)		$	(13,404,693	)
	Basic loss per share:
	Net loss, as previously reported		$	(0.00	)		$	(0.01	)
	Net adjustments
	Research and development			(0.00	)			(0.00	)
	General and administrative expenses			(0.00	)			(0.00	)
	Adjustments to fair value of unsettled warrant obligation			0				0
	Net loss, restated		$	(0.00	)		$	(0.01	)
	Diluted loss per share:
	Net loss, as previously reported		$	(0.00	)		$	(0.01	)
	Net adjustments
	Research and development			(0.00	)			(0.00	)
	General and administrative expenses			(0.00	)			(0.00	)
	Adjustments to fair value of unsettled warrant obligation			0				0
	Net loss, restated		$	(0.00	)		$	(0.01	)
	Weighted average shares used in computing net loss per share:
	Basic			2,451,694,258				2,389,481,712
	Diluted			2,451,694,258				2,389,481,712

	Consolidated Statements of Operations (unaudited) for the three months ended June 30, 2013

			Three months ended June 30, 2013
			As Previously Reported				Adjustments				As Restated

	Revenue		$	58,268							$	58,268
	Cost of revenue			16,859								16,859
	Gross profit			41,409				–				41,409
	Operating expenses:
	Research and development			2,862,237				113,033				2,975,270
	General and administrative expenses			2,643,319				9,524				2,652,843
	Total operating expenses			5,505,556				122,557				5,628,113
	Loss from operations			(5,464,147	)			(122,557	)			(5,586,704	)
	Non-operating income (expense):
	Interest income			1,015								1,015
	Interest expense and late fees			(370,228	)							(370,228	)
	Finance gain (cost)			(687,139	)			396,000				(291,139	)
	Fines and penalties			(587,147	)							(587,147	)
	Gain on extinguishment of debt			438,587								438,587
	Adjustments to fair value of unsettled warrant obligation			–				(556,153	)			(556,153	)
	Adjustments to fair value of derivatives			57,713								57,713
	Total non-operating expense			(1,147,199	)			(160,153	)			(1,307,352	)
	Loss before provision for income tax			(6,611,346	)			(282,710	)			(6,894,056	)
	Provision for income tax			–				–				–
	Net loss		$	(6,611,346	)		$	(282,710	)		$	(6,894,056	)
	Loss per share:
	Basic		$	(0.00	)		$	(0.00	)		$	(0.00	)
	Diluted			(0.00	)			(0.00	)			(0.00	)
	Weighted average shares outstanding:
	Basic			2,451,694,258				–				2,451,694,258
	Diluted			2,451,694,258				–				2,451,694,258

	Consolidated Statements of Operations (unaudited) for the six months ended June 30, 2013

			Six months ended June 30, 2013
		As Previously Reported				Adjustments				As Restated

Revenue		$	146,049							$	146,049
Cost of revenue			51,218								51,218
Gross profit			94,831				–				94,831
Operating expenses:
Research and development			5,854,237				219,592				6,073,829
General and administrative expenses			5,469,183				17,529				5,486,712
Total operating expenses			11,323,420				237,121				11,560,541
Loss from operations			(11,228,589	)			(237,121	)			(11,465,710	)
Non-operating income (expense):
Interest income			2,792								2,792
Interest expense and late fees			(894,417	)							(894,417	)
Finance gain (cost)			(980,259	)			1,026,000				45,741
Fines and penalties			(587,147	)							(587,147	)
Gain on extinguishment of debt			438,587								438,587
Adjustments to fair value of unsettled warrant obligation			–				(1,169,185	)			(1,169,185	)
Adjustments to fair value of derivatives			224,646								224,646
Total non-operating expense			(1,795,798	)			(143,185	)			(1,938,983	)
Loss before provision for income tax			(13,024,387	)			(380,306	)			(13,404,693	)
Provision for income tax			–				–				–
Net loss		$	(13,024,387	)		$	(380,306	)		$	(13,404,693	)
Loss per share:
Basic		$	(0.01	)		$	(0.00	)		$	(0.01	)
Diluted			(0.01	)			(0.00	)			(0.01	)
Weighted average shares outstanding:
Basic			2,389,481,712				–				2,389,481,712
Diluted			2,389,481,712				–				2,389,481,712

Consolidated Statement of Cash Flows Impact

The following table includes selected information from the Company’s consolidated statements of cash flows presenting previously reported and restated cash flows, for the six months ended June 30, 2013:

		For the six months ended
		30-Jun-13
		As Previously Reported				As
		As Previously Reported				Restated

Net loss		$	(13,024,387	)		$	(13,404,693	)
Stock based compensation			1,793,884				2,031,005
Adjustments to fair value of unsettled warrant obligation			–				1,169,185
Non-cash financing costs			(128,233	)			(1,154,233	)
Net cash used in operating activities			(12,483,489	)			(12,483,489	)

3_SUMMARY_OF_SIGNIFICANT_ACCOU2

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Estimated useful lives

Machinery & equipment

4 years

Computer equipment

3 years

Office furniture

4 years

Leasehold improvements

Lesser of lease life or economic life

Capital leases

Lesser of lease life or economic life

Company identified the following assets and liabilities

Description

Fair Value

Fair Value Measurements at

As of

30-Jun-14

Using Fair Value Hierarchy

Level 1

Level 2

Level 3

Warrant and option derivative liabilities

270,999

–

270,999

Total

270,999

–

270,999

Fair value for measurements

Warrant and Option Derivative Liabilities

Balance at December 31, 2013

284,799

Total (gains) for the period included in earnings

(13,800

)

Balance at June 30, 2014

270,999

Embedded Conversion Option Liabilities

Balance at December 31, 2013

663,000

Total (gains) for the period included in earnings

(663,000

)

Balance at June 30, 2014

–

Gains and losses included in earnings

Warrant and Option Derivative Liabilities

Total gain included in earnings

13,800

Embedded Conversion Option Liabilities

Total gain included in earnings

663,000

Quantitative information within Level 3 of the fair value hierarchy

Fair Value at

June 30,

Valuation

Description

2014

Technique

Unobservable Input

Value

Warrant and Option derivative liabilities

270,999

Black Scholes Model

Expected volatility of the Company's common stock

65% - 90%

4_INVESTMENT_IN_JOINT_VENTURE_

4. INVESTMENT IN JOINT VENTURE (Tables)	6 Months Ended
4. INVESTMENT IN JOINT VENTURE (Tables)	Jun. 30, 2014
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]	'
Summary of key financial data for the joint venture	'
		June 30,
		2014		2013
	Current assets	$	257,400	$	191,544
	Noncurrent assets		1,298,307		1,245,289
	Current liabilities		292,116		294,165
	Noncurrent liabilities		1,729,495		2,021,611
	Net revenue		146,058		146,058
	Net income (loss)	$	101,095	$	84,638

5_PROPERTY_AND_EQUIPMENT_Table

5. PROPERTY AND EQUIPMENT (Tables)	6 Months Ended
5. PROPERTY AND EQUIPMENT (Tables)	Jun. 30, 2014
Property, Plant and Equipment [Abstract]	'
Property and equipment consisted of the following at March 31, 2012 and December 31, 2011:	'
			June 30,			December 31,
			2014			2013
	Machinery & equipment (1)		$	1,135,385		$	1,086,800
	Computer equipment			64,967			49,707
	Office furniture			49,560			38,783
	Leasehold improvements (1)			604,732			559,969
				1,854,644			1,735,259

	Accumulated depreciation			(1,046,025	)		(981,683	)
	Property and equipment, net		$	808,619		$	753,576

	-1	The June 30, 2014 balances include approximately $133,038 in machinery & equipment and $366,223 in leasehold improvements that were not yet placed in service at June 30, 2014 and therefore had not started being depreciated as of that date.

6_ACCRUED_SETTLEMENT_Tables

6. ACCRUED SETTLEMENT (Tables)	6 Months Ended
6. ACCRUED SETTLEMENT (Tables)	Jun. 30, 2014
Accrued Settlement	'
Accrued settlement	'
		June 30,		December 31,
		2014		2013
	SEC Civil Action	$	2,724,411	$	4,086,619
	SEC Section 16 Investigation		375,000		–
	Total	$	3,099,411	$	4,086,619

8_LOSS_CONTINGENCY_ACCRUAL_Tab

8. LOSS CONTINGENCY ACCRUAL (Tables)	6 Months Ended
8. LOSS CONTINGENCY ACCRUAL (Tables)	Jun. 30, 2014
Commitments and Contingencies Disclosure [Abstract]	'
Loss contingency accrual	'
		June 30,		December 31,
		2014		2013
	Warrant holder litigation	$	–	$	6,228,621
	Miscellaneous settlements		221,581		203,358
	Total	$	221,581	$	6,431,979

12_WARRANT_SUMMARY_Tables

12. WARRANT SUMMARY (Tables)	6 Months Ended
12. WARRANT SUMMARY (Tables)	Jun. 30, 2014
Warrants and Rights Note Disclosure [Abstract]	'
Summary of warrant activity	'
										Weighted
							Weighted			Average		Aggregate
							Average			Remaining		Intrinsic
			Number of				Exercise			Contractual		Value
			Warrants				Price $			Life (in years)		(000)$
	Outstanding, December 31, 2013			7,829,883				0.28			1.82		–
	Granted			–				–
	Exercised			–				–
	Forfeited/Canceled			(452,927	)			0.1
	Outstanding, June 30, 2014			7,376,956				0.29			1.41
	Exercisable, June 30, 2014			7,376,956				0.29			1.41		–
Summary of warrants outstanding and exercisable	'
		Warrants Outstanding and Exercisable
						Weighted			Weighted
						Average			Average
	Exercise	Number				Remaining			Exercise
	Price $	of Shares				Life (Years)			Price $
	.10 - .11		2,786,320				0.5			0.1
	.20 - .30		1,630,000				1.5			0.25
	.38-.39		1,330,636				3.07			0.39
	.40-.45		815,000				1.5			0.45
	0.7		815,000				1.5			0.7
			7,376,956

14_STOCKBASED_COMPENSATION_Tab

14. STOCK-BASED COMPENSATION (Tables)	6 Months Ended
14. STOCK-BASED COMPENSATION (Tables)	Jun. 30, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]	'
Stock Plans	'
										Options/Shares
			Options/Shares				Options			Available			Total
	Stock Plan		Issued				Outstanding			For Grant			Authorized
	2004 Stock Plan			2,492,000				70,000			1,215,104			2,800,000
	2004 Stock Plan II			650,000				420,000			651,161			1,301,161
	2005 Stock Plan			158,079,319				125,168,698			423,759,464			581,838,783
				161,221,319				125,658,698			425,625,729			585,939,944
Stock Option Activity	'
										Weighted
							Weighted			Average
							Average			Remaining			Aggregate
			Number of				Exercise			Contractual			Intrinsic
			Options				Price			Life (in years)			Value
	Outstanding, December 31, 2013			118,278,611			$	0.19			6.95		$	10,319
	Granted			16,075,000				0.08
	Exercised			–				–
	Forfeited/canceled			(8,694,913	)			0.31
	Outstanding, June 30, 2014			125,658,698				0.17			7.16			65,824

	Vested and expected to vest at June 30, 2014			122,815,109			$	0.17			7.1		$	63,642

	Exercisable, June 30, 2014			103,784,935			$	0.19			6.69		$	49,039
Summary stock options outstanding and exercisable	'
				Options Outstanding					Options Exercisable
						Weighted		Weighted			Weighted	Weighted
						Average		Average			Average	Average
		Exercise		Number		Exercise		Remaining	Number		Exercise	Remaining
		Price		of Shares		Price		Life (Years)	of Shares		Price	Life (Years)
	$	0.05 - 0.0799		23,305,714	$	0.07		9.05	14,251,547	$	0.07	9.02
		0.08 - 0.10		42,329,081		0.09		7.43	29,509,485		0.09	6.52
		0.101 - 0.157		20,250,000		0.15		6.96	20,250,000		0.15	6.96
		0.158 - 0.21		25,634,166		0.19		6.23	25,634,166		0.19	6.23
		0.22 - 0.45		10,420,000		0.37		6.74	10,420,000		0.37	6.74
		0.46 - 0.85		3,114,737		0.85		0.59	3,114,737		0.85	0.59
	$	0.86 - 2.48		605,000	$	2.02		1.38	605,000	$	2.02	1.38
				125,658,698					103,784,935
Assumptions in calculating the fair value of options granted	'
			June 30,		June 30,
			2014		2013
	Risk-free interest rate		0.02 – 2.27%		0.76 - 1.91%
	Expected life of the options		5.00 - 6.25 years		5.00 - 6.50 years
	Expected volatility		112 - 148%		160%
	Expected dividend yield		0%		0%
	Expected forfeitures		13%		13%

2_RESTATEMENT_OF_PREVIOUSLY_IS2

2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details-Net Loss) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Net loss, restated	($15,517,976)	($6,894,056)	($24,207,750)	($13,404,693)
Basic loss per share	'	$0	'	($0.01)
Diluted loss per share	'	$0	'	($0.01)
Weighted average shares used in computing net loss per share - basic	'	2,451,694,258	'	2,389,481,712
Weighted average shares used in computing net loss per share- diluted	'	2,451,694,258	'	2,389,481,712
As Previously Reported	'	'	'	'
Net loss, restated	'	-6,611,346	'	-13,024,387
Basic loss per share	'	$0	'	($0.01)
Diluted loss per share	'	$0	'	($0.01)
Weighted average shares used in computing net loss per share - basic	'	2,451,694,258	'	2,389,481,712
Weighted average shares used in computing net loss per share- diluted	'	2,451,694,258	'	2,389,481,712
Adjustments	'	'	'	'
Net loss, restated	'	-282,710	'	-380,306
Basic loss per share	'	$0	'	$0
Diluted loss per share	'	$0	'	$0
Adjustments \| Research and Development Expense [Member]	'	'	'	'
Net loss, restated	'	-113,033	'	-219,592
Basic loss per share	'	$0	'	$0
Diluted loss per share	'	$0	'	$0
Adjustments \| General and Administrative Expense [Member]	'	'	'	'
Net loss, restated	'	-9,524	'	-17,529
Basic loss per share	'	$0	'	$0
Diluted loss per share	'	$0	'	$0
Adjustments \| Adjustments to fair value of unsettled warrant obligation	'	'	'	'
Net loss, restated	'	($160,153)	'	($143,185)
Basic loss per share	'	$0	'	$0
Diluted loss per share	'	$0	'	$0

2_RESTATEMENT_OF_PREVIOUSLY_IS3

2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details-Income Statement) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Revenue	$39,469	$58,268	$78,937	$146,049
Cost of revenue	15,608	16,859	31,217	51,218
Gross profit	23,861	41,409	47,720	94,831
Operating expenses:	'	'	'	'
Research and development	2,718,625	2,975,270	5,226,469	6,073,829
General and administrative expenses	2,175,749	2,652,843	5,488,312	5,486,712
Total operating expenses	16,461,383	5,628,113	24,183,328	11,560,541
Loss from operations	-16,437,522	-5,586,704	-24,135,608	-11,465,710
Non-operating income (expense):	'	'	'	'
Interest income	951	1,015	55,840	2,792
Interest expense and late fees	-132,532	-370,228	-429,504	-894,417
Finance gain (cost)	-343,511	-291,139	-394,237	45,741
Fines and penalties	0	-587,147	0	-587,147
Gain on extinguishment of debt	0	438,587	0	438,587
Adjustments to fair value of unsettled warrant obligation	1,004,867	-556,153	18,959	-1,169,185
Adjustments to fair value of derivatives	389,771	57,713	676,800	224,646
Total non-operating expense	919,546	-1,307,352	-72,142	-1,938,983
Loss before provision for income tax	-15,517,976	-6,894,056	-24,207,750	-13,404,693
Provision for income tax	0	0	0	0
Net loss	-15,517,976	-6,894,056	-24,207,750	-13,404,693
Loss per share:	'	'	'	'
Basic	'	$0	'	($0.01)
Diluted	'	$0	'	($0.01)
Weighted average shares outstanding:	'	'	'	'
Basic	'	2,451,694,258	'	2,389,481,712
Diluted	'	2,451,694,258	'	2,389,481,712
As Previously Reported	'	'	'	'
Revenue	'	58,268	'	146,049
Cost of revenue	'	16,859	'	51,218
Gross profit	'	41,409	'	94,831
Operating expenses:	'	'	'	'
Research and development	'	2,862,237	'	5,854,237
General and administrative expenses	'	2,643,319	'	5,469,183
Total operating expenses	'	5,505,556	'	11,323,420
Loss from operations	'	-5,464,147	'	-11,228,589
Non-operating income (expense):	'	'	'	'
Interest income	'	1,015	'	2,792
Interest expense and late fees	'	-370,228	'	-894,417
Finance gain (cost)	'	-687,139	'	-980,259
Fines and penalties	'	-587,147	'	-587,147
Gain on extinguishment of debt	'	438,587	'	438,587
Adjustments to fair value of unsettled warrant obligation	'	0	'	0
Adjustments to fair value of derivatives	'	57,713	'	224,646
Total non-operating expense	'	-1,147,199	'	-1,795,798
Loss before provision for income tax	'	-6,611,346	'	-13,024,387
Provision for income tax	'	0	'	0
Net loss	'	-6,611,346	'	-13,024,387
Loss per share:	'	'	'	'
Basic	'	$0	'	($0.01)
Diluted	'	$0	'	($0.01)
Weighted average shares outstanding:	'	'	'	'
Basic	'	2,451,694,258	'	2,389,481,712
Diluted	'	2,451,694,258	'	2,389,481,712
Adjustments	'	'	'	'
Operating expenses:	'	'	'	'
Research and development	'	113,033	'	219,592
General and administrative expenses	'	9,524	'	17,529
Total operating expenses	'	122,557	'	237,121
Loss from operations	'	-122,557	'	-237,121
Non-operating income (expense):	'	'	'	'
Finance gain (cost)	'	396,000	'	1,026,000
Adjustments to fair value of unsettled warrant obligation	'	-556,153	'	-1,169,185
Total non-operating expense	'	-160,153	'	-143,185
Loss before provision for income tax	'	-282,710	'	-380,306
Provision for income tax	'	0	'	0
Net loss	'	($282,710)	'	($380,306)
Loss per share:	'	'	'	'
Basic	'	$0	'	$0
Diluted	'	$0	'	$0

2_RESTATEMENT_OF_PREVIOUSLY_IS4

2. RESTATEMENT OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS (Details-Cash Flow) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Net loss	($15,517,976)	($6,894,056)	($24,207,750)	($13,404,693)
Stock based compensation	219,611	898,381	566,026	2,031,005
Adjustments to fair value of unsettled warrant obligation	-1,004,867	556,153	-18,959	1,169,185
Non-cash financing costs	'	'	18,223	-1,154,233
Net cash used in operating activities	'	'	-10,572,936	-12,483,489
As Previously Reported	'	'	'	'
Net loss	'	-6,611,346	'	-13,024,387
Stock based compensation	'	'	'	1,793,884
Adjustments to fair value of unsettled warrant obligation	'	0	'	0
Non-cash financing costs	'	'	'	-128,233
Net cash used in operating activities	'	'	'	($12,483,489)

3_SUMMARY_OF_SIGNIFICANT_ACCOU3

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details-Estimated useful lives)	6 Months Ended
	Jun. 30, 2014
Machinery and equipment	'
Estimated useful lives	'4 years
Computer Equipment	'
Estimated useful lives	'3 years
Office furniture member	'
Estimated useful lives	'4 years
Leasehold Improvements	'
Estimated useful lives	'Lesser of lease life or economic life
Capital Leases	'
Estimated useful lives	'Lesser of lease life or economic life

3_SUMMARY_OF_SIGNIFICANT_ACCOU4

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details-Fair value hierarchy) (USD $)	Jun. 30, 2014
Warrant and option derivative liabilities	$270,999
Total Derivative Liabilities	270,999
Fair Value Inputs Level 1	'
Warrant and option derivative liabilities	0
Total Derivative Liabilities	0
Fair Value Inputs Level 2	'
Warrant and option derivative liabilities	0
Total Derivative Liabilities	0
Fair Value Inputs Level 3	'
Warrant and option derivative liabilities	270,999
Total Derivative Liabilities	$270,999

3_SUMMARY_OF_SIGNIFICANT_ACCOU5

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details-Level 3) (USD $)	6 Months Ended
	Jun. 30, 2014
Warrant and Option Derivative Liabilities	'
Beginning balance	$284,799
Total (gains) for the period included in earnings	-13,800
Ending balance	270,999
Embedded Conversion Option Liabilities	'
Beginning balance	663,000
Total (gains) for the period included in earnings	-663,000
Ending balance	$0

3_SUMMARY_OF_SIGNIFICANT_ACCOU6

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Gain included in earnings) (USD $)	6 Months Ended
	Jun. 30, 2014
Embedded Conversion Option Liabilities	'
Gain included in earnings	$663,000
Warrant and Option Derivative Liabilities	'
Gain included in earnings	$13,800

3_SUMMARY_OF_SIGNIFICANT_ACCOU7

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Accounting Policies [Abstract]	'	'	'	'	'
Accumulated deficit	($338,115,364)	'	($338,115,364)	'	($313,844,357)
Deposits in excess of federally-insured limits	3,678,495	'	3,678,495	'	1,668,232
Increase (decrease) in research and development costs	0	60,022	0	120,044	'
Gain (loss) for the changes in the valuation of derivative liabilities	389,771	57,713	676,800	224,646	'
License fee revenue	$39,469	$58,268	$78,937	$146,049	'
Options outstanding	125,658,698	'	125,658,698	'	'
Shares excluded from calculation of diluted earnings per share as their inclusion would be anti-dilutive	'	'	133,035,654	168,401,502	'

4_INVESTMENT_IN_JOINT_VENTURE_1

4. INVESTMENT IN JOINT VENTURE (Details) (USD $)	6 Months Ended
4. INVESTMENT IN JOINT VENTURE (Details) (USD $)	Jun. 30, 2014	Jun. 30, 2013
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]	'	'
Current assets	$257,400	$191,544
Noncurrent assets	1,298,307	1,245,289
Current liabilities	292,116	294,165
Noncurrent liabilities	1,729,495	2,021,611
Net revenue	146,058	146,058
Net income (loss)	$101,095	$84,638

4_INVESTMENT_IN_JOINT_VENTURE_2

4. INVESTMENT IN JOINT VENTURE (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
4. INVESTMENT IN JOINT VENTURE (Details Narrative) (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]	'	'	'	'	'
License fee revenue	$7,353	$7,353	$14,706	$14,706	'
Unamortized license fee of is included in deferred revenue	$337,010	'	$337,010	'	$351,715

5_PROPERTY_AND_EQUIPMENT_Detai

5. PROPERTY AND EQUIPMENT (Details) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Property, Plant and Equipment [Line Items]	'	'
Property and equipment, gross	$1,854,644	$1,735,259
Accumulated depreciation	-1,046,025	-981,683
Property and equipment, net	808,619	753,576
Machinery and Equipment [Member]	'	'
Property, Plant and Equipment [Line Items]	'	'
Property and equipment, gross	1,135,385	1,086,800
Computer Equipment [Member]	'	'
Property, Plant and Equipment [Line Items]	'	'
Property and equipment, gross	64,967	49,707
Office Furniture [Member]	'	'
Property, Plant and Equipment [Line Items]	'	'
Property and equipment, gross	49,560	38,783
Leasehold Improvements [Member]	'	'
Property, Plant and Equipment [Line Items]	'	'
Property and equipment, gross	$604,732	$559,969

5_PROPERTY_AND_EQUIPMENT_Detai1

5. PROPERTY AND EQUIPMENT (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
5. PROPERTY AND EQUIPMENT (Details Narrative) (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Property, Plant and Equipment [Abstract]	'	'	'	'
Depreciation expense	$33,382	$19,850	$64,342	$37,702

6_ACCRUED_SETTLEMENT_Details

6. ACCRUED SETTLEMENT (Details) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Accrued settlement	$3,099,411	$4,086,619
SEC Civil Action	'	'
Accrued settlement	2,724,411	4,086,619
SEC Section 16 Investigation	'	'
Accrued settlement	$375,000	$0

7_CONVERTIBLE_PROMISSORY_NOTES1

7. CONVERTIBLE PROMISSORY NOTES (Details Narrative) (USD $)	6 Months Ended			12 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Dec. 31, 2013	Dec. 31, 2013
	Jun. 30, 2014	Jun. 30, 2013	CAMOFI	CAMOFI	CAMHZN
Debentures issued	'	'	'	$4,732,781	$1,267,219
Interest rate	'	'	'	8.00%	8.00%
Maturity date	'	'	'	30-Jun-15	30-Jun-15
Repayment of convertible note	1,200,000	600,000	1,200,000	'	'
Repayment on penalties, interest and legal cost	'	'	416,000	'	'
Embedded beneficial conversion feature	'	'	'	663,000	'
Gain on change in fair value of embedded conversion feature	'	'	663,000	'	'
Debt discount	'	'	'	725,000	'
Unamortized debt discount written off to interest	'	'	$108,229	'	'

8_LOSS_CONTINGENCY_ACCRUAL_Det

8. LOSS CONTINGENCY ACCRUAL (Details) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Total loss contingency accrual	$221,581	$6,431,979
Warrant holder litigation	'	'
Total loss contingency accrual	0	6,228,621
Miscellaneous settlements	'	'
Total loss contingency accrual	$221,581	$203,358

8_LOSS_CONTINGENCY_ACCRUAL_Det1

8. LOSS CONTINGENCY ACCRUAL (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
8. LOSS CONTINGENCY ACCRUAL (Details Narrative) (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Loss Contingency Accrual Details Narrative	'	'	'	'
Stock issued in settlement, shares issued	'	'	384,000,000	'
Stock issued in settlement, value	'	'	$23,577,600	'
Loss on settlement of litigation	($11,567,009)	$0	($13,468,547)	$0

9_UNSETTLED_WARRANT_OBLIGATION1

9. UNSETTLED WARRANT OBLIGATION (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
9. UNSETTLED WARRANT OBLIGATION (Details Narrative) (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Unsettled Warrant Obligation	'	'	'	'	'
Unsettled warrant obligation	$0	'	$0	'	$3,899,391
Change in fair value of unsettled warrant obligation	$1,004,867	($556,153)	$18,959	($1,169,185)	'

10_SERIES_B_PREFERRED_STOCK_De

10. SERIES B PREFERRED STOCK (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
10. SERIES B PREFERRED STOCK (Details Narrative) (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Redemption of stock	'	'	($70,129)	$0	'
Series B Preferred Stock	'	'	'	'	'
Accrued dividends on preferred stock	2,980,258	'	2,980,258	'	3,587,748
Redemption of stock	'	'	-70,129	'	'
Value of secured promissory notes	10,448,835	'	10,448,835	'	13,561,607
Discounts on secured promissory notes	403,049	'	403,049	'	654,559
Accrued interest on secured promissory notes	726,884	'	726,884	'	716,166
Face value of secured promissory notes	10,125,000	'	10,125,000	'	13,500,000
Interest accreted	298,006	312,116	556,170	601,958	'
Dividend expense	297,448	312,718	631,581	603,119	'
Commitment drawn	$10,000,000	'	$10,000,000	'	'

11_SERIES_C_PREFERRED_STOCK_De

11. SERIES C PREFERRED STOCK (Details Narrative) (Series C Preferred Stock, USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Series C Preferred Stock	'	'	'	'	'
Accrued dividends on preferred stock	$3,040,267	'	$3,040,267	'	$2,454,853
Value of secured promissory notes	21,049,355	'	21,049,355	'	20,451,788
Discounts on secured promissory notes	965,383	'	965,383	'	1,363,762
Accrued interest on secured promissory notes	1,014,738	'	1,014,738	'	815,549
Face value of secured promissory notes	21,000,000	'	21,000,000	'	21,000,000
Interest accreted	303,641	286,454	597,568	563,744	'
Dividend expense	295,743	279,003	585,414	552,277	'
Commitment drawn	17,500,000	'	17,500,000	'	'
Commitment fee available	$25,000,000	'	$25,000,000	'	'

12_WARRANT_SUMMARY_DetailsWarr

12. WARRANT SUMMARY (Details-Warrant activity) (USD $)	6 Months Ended	12 Months Ended
12. WARRANT SUMMARY (Details-Warrant activity) (USD $)	Jun. 30, 2014	Dec. 31, 2013
Number of Warrants, Ending	7,829,883	'
WarrantMember	'	'
Number of Warrants, Beginning	7,829,883	'
Number of Warrants, Granted	0	'
Number of Warrants, Exercised	0	'
Number of Warrants, Forfeited/Canceled	-452,927	'
Number of Warrants, Ending	7,376,956	7,829,883
Number of Warrants, Exercisable	7,376,956	'
Weighted Average Exercise Price, Beginning	$0.29	'
Weighted Average Exercise Price, Granted	'	'
Weighted Average Exercise Price, Exercised	'	'
Weighted Average Exercise Price, Forfeited/Canceled	$0.10	'
Weighted Average Exercise Price, Ending	$0.29	$0.29
Weighted Average Exercise Price, Exercisable	$0.29	'
Weighted Average Remaining Contractual Life (in years), Ending	'1 year 4 months 28 days	'1 year 9 months 25 days
Weighted Average Remaining Contractual Life (in years), Exercisable	'1 year 4 months 28 days	'
Aggregate intrinsic value outstanding	'	'
Aggregate intrinsic value exercisable	'	'

12_WARRANT_SUMMARY_DetailsWarr1

12. WARRANT SUMMARY (Details-Warrants outstanding and exercisable) (USD $)	6 Months Ended
	Jun. 30, 2014
Number of shares	7,829,883
Exercise Price $.10 - .11	'
Number of shares	3,239,247
Weighted Average Remaining Life (Years)	'6 months
Weighted Average Exercise Price $	$0.10
Exercise Price $.20 - .30	'
Number of shares	1,630,000
Weighted Average Remaining Life (Years)	'1 year 6 months
Weighted Average Exercise Price $	$0.25
Exercise Price $.38 - .39	'
Number of shares	1,330,636
Weighted Average Remaining Life (Years)	'3 years 25 days
Weighted Average Exercise Price $	$0.39
Exercise Price $.40 - .45	'
Number of shares	815,000
Weighted Average Remaining Life (Years)	'1 year 6 months
Weighted Average Exercise Price $	$0.45
Exercise Price $.70	'
Number of shares	815,000
Weighted Average Remaining Life (Years)	'1 year 6 months
Weighted Average Exercise Price $	$0.70

13_STOCKHOLDERS_DEFICIT_TRANSA1

13. STOCKHOLDERS' DEFICIT TRANSACTIONS (Details Narrative) (USD $)	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Stock issued in settlement, amount	$25,977,600	$5,700,000
Stock issued to board members, amount	142,734	'
Board members	'	'
Stock issued to board members, shares	1,972,826	'
Stock issued to board members, amount	142,734	'
Lincoln Park	'	'
Common stock sold for cash, shares	226,974,958	'
Common stock sold for cash, amount	14,281,295	'
CAMOFI	'	'
Stock issued in settlement, shares	43,373,609	'
Stock issued in settlement, amount	2,400,000	'
Aronson-Gorton	'	'
Stock issued in settlement, shares	384,000,000	'
Stock issued in settlement, amount	$23,577,600	'

14_STOCKBASED_COMPENSATION_Det

14. STOCK-BASED COMPENSATION (Details-Stock Plans)	6 Months Ended
14. STOCK-BASED COMPENSATION (Details-Stock Plans)	Jun. 30, 2014
Options/Shares Issued	161,221,319
Options outstanding	125,658,698
Options/Shares Available For Grant	425,625,729
Total Authorized	585,939,944
2004 Stock Plan	'
Options/Shares Issued	2,492,000
Options outstanding	70,000
Options/Shares Available For Grant	1,215,104
Total Authorized	2,800,000
2004 Stock Plan II	'
Options/Shares Issued	650,000
Options outstanding	420,000
Options/Shares Available For Grant	651,161
Total Authorized	1,301,161
2005 Stock Plan	'
Options/Shares Issued	158,079,319
Options outstanding	125,168,698
Options/Shares Available For Grant	423,759,464
Total Authorized	581,838,783

14_STOCKBASED_COMPENSATION_Det1

14. STOCK-BASED COMPENSATION (Details-Stock option activity) (USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Number of Options	'	'
Number of Options Granted	161,221,319	'
Number of shares outstanding ending balance	125,658,698	'
Stock Options	'	'
Number of Options	'	'
Number of shares outstanding beginning balance	118,278,611	'
Number of Options Granted	16,075,000	'
Number of Options Exercised	0	'
Number of Options Forfeited/canceled	-8,694,913	'
Number of shares outstanding ending balance	125,658,698	118,278,611
Number of Options Vested and expected to vest	122,815,109	'
Number of Options Exercisable	103,784,935	'
Weighted Average Exercise Price	'	'
Weighted Average Exercise Price Outstanding, Beginning	$0.19	'
Weighted Average Exercise Price Granted	$0.08	'
Weighted Average Exercise Price Exercised	'	'
Weighted Average Exercise Price Forfeited/canceled	$0.31	'
Weighted Average Exercise Price Outstanding, Ending	$0.17	$0.19
Weighted Average Exercise Price Vested and expected to vest	$0.17	'
Weighted Average Exercise Price Exercisable	$0.19	'
Weighted Average Remaining Contractual Life (in years)	'	'
Weighted Average Remaining Contractual Life (in years) Outstanding	'7 years 1 month 28 days	'6 years 11 months 12 days
Weighted Average Remaining Contractual Life (in years) Vested and expected to vest	'7 years 1 month 6 days	'
Weighted Average Remaining Contractual Life (in years) Exercisable	'6 years 8 months 8 days	'
Aggregate Intrinsic Value, beginning value	$10,319	'
Aggregate Intrinsic Value, ending value	65,824	10,319
Aggregate Intrinsic Value vested and expected to vest	63,642	'
Aggregate Intrinsic Value Exercisable	$49,039	'

14_STOCKBASED_COMPENSATION_Det2

14. STOCK-BASED COMPENSATION (Details-Options outstanding and exercisable) (USD $)	6 Months Ended	12 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Options Outstanding	'	'
Number of shares outstanding	125,658,698	'
Exercise Price $0.05-0.079	'	'
Options Outstanding	'	'
Number of shares outstanding	23,305,714	'
Weighted Average Exercise Price Outstanding	$0.07	'
Weighted Average Remaining Life (Years) Outstanding	'9 years 18 days	'
Options Exercisable	'	'
Number of Shares Exercisable	14,251,547	'
Weighted Average Exercise Price Exercisable	$0.07	'
Weighted Average Remaining Life (Years) Exercisable	'9 years 7 days	'
Exercise Price $0.08-0.09	'	'
Options Outstanding	'	'
Number of shares outstanding	42,329,081	'
Weighted Average Exercise Price Outstanding	$0.09	'
Weighted Average Remaining Life (Years) Outstanding	'7 years 5 months 5 days	'
Options Exercisable	'	'
Number of Shares Exercisable	29,509,485	'
Weighted Average Exercise Price Exercisable	$0.09	'
Weighted Average Remaining Life (Years) Exercisable	'6 years 6 months 7 days	'
Exercise Price $0.10-0.157	'	'
Options Outstanding	'	'
Number of shares outstanding	20,250,000	'
Weighted Average Exercise Price Outstanding	$0.15	'
Weighted Average Remaining Life (Years) Outstanding	'6 years 11 months 16 days	'
Options Exercisable	'	'
Number of Shares Exercisable	20,250,000	'
Weighted Average Exercise Price Exercisable	$0.15	'
Weighted Average Remaining Life (Years) Exercisable	'6 years 11 months 16 days	'
Exercise Price $0.185-0.21	'	'
Options Outstanding	'	'
Number of shares outstanding	25,634,166	'
Weighted Average Exercise Price Outstanding	$0.19	'
Weighted Average Remaining Life (Years) Outstanding	'6 years 2 months 23 days	'
Options Exercisable	'	'
Number of Shares Exercisable	25,634,166	'
Weighted Average Exercise Price Exercisable	$0.19	'
Weighted Average Remaining Life (Years) Exercisable	'6 years 2 months 23 days	'
Exercise Price $0.25-0.45	'	'
Options Outstanding	'	'
Number of shares outstanding	10,420,000	'
Weighted Average Exercise Price Outstanding	$0.37	'
Weighted Average Remaining Life (Years) Outstanding	'6 years 8 months 26 days	'
Options Exercisable	'	'
Number of Shares Exercisable	10,420,000	'
Weighted Average Exercise Price Exercisable	$0.37	'
Weighted Average Remaining Life (Years) Exercisable	'6 years 8 months 26 days	'
Exercise Price $.046-0.85	'	'
Options Outstanding	'	'
Number of shares outstanding	3,114,737	'
Weighted Average Exercise Price Outstanding	$0.85	'
Weighted Average Remaining Life (Years) Outstanding	'7 months 2 days	'
Options Exercisable	'	'
Number of Shares Exercisable	3,114,737	'
Weighted Average Exercise Price Exercisable	$0.85	'
Weighted Average Remaining Life (Years) Exercisable	'7 months 2 days	'
Exercise Price $0.86-2.48	'	'
Options Outstanding	'	'
Number of shares outstanding	605,000	'
Weighted Average Exercise Price Outstanding	$2.02	'
Weighted Average Remaining Life (Years) Outstanding	'1 year 4 months 17 days	'
Options Exercisable	'	'
Number of Shares Exercisable	605,000	'
Weighted Average Exercise Price Exercisable	$2.02	'
Weighted Average Remaining Life (Years) Exercisable	'1 year 4 months 17 days	'
Stock Options	'	'
Options Outstanding	'	'
Number of shares outstanding	125,658,698	118,278,611
Weighted Average Exercise Price Outstanding	$0.17	$0.19
Weighted Average Remaining Life (Years) Outstanding	'7 years 1 month 28 days	'6 years 11 months 12 days
Options Exercisable	'	'
Number of Shares Exercisable	103,784,935	'
Weighted Average Exercise Price Exercisable	$0.19	'
Weighted Average Remaining Life (Years) Exercisable	'9 years 3 months 11 days	'

14_STOCKBASED_COMPENSATION_Det3

14. STOCK-BASED COMPENSATION (Details-Assumptions)	6 Months Ended
14. STOCK-BASED COMPENSATION (Details-Assumptions)	Jun. 30, 2014	Jun. 30, 2013
The assumptions used in calculating the fair value of options granted using the Black-Scholes option- pricing model for options granted during the three months ended March 31, 2012 are as follows:	'	'
Risk-free interest rate minimum	0.02%	0.76%
Risk-free interest rate maximum	2.27%	1.91%
Expected life of the options	'5.00 to 6.25 years	'5.00 to 6.50 years
Expected volatility minimum	112.00%	'
Expected volatility maximum	148.00%	'
Expected volatility	'	160.00%
Expected dividend yield	0.00%	0.00%
Expected forfeitures	13.00%	13.00%

14_STOCKBASED_COMPENSATION_Det4

14. STOCK-BASED COMPENSATION (Details Narrative) (USD $)	3 Months Ended		6 Months Ended
14. STOCK-BASED COMPENSATION (Details Narrative) (USD $)	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Stock-based compensation expense	$219,611	$898,381	$566,026	$2,031,005
Stock Options	'	'	'	'
Weighted average grant-date fair value	'	'	$0.08	$0.08
Compensation expense related to unvested options	$1,400,227	'	$1,400,227	'
Weighted average period of compensation expense related to unvested options	'	'	'	'2 years 9 months 22 days