Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Oct. 31, 2016 | Dec. 02, 2016 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | PharmaCyte Biotech, Inc. | |
Entity Central Index Key | 1,157,075 | |
Document Type | 10-Q | |
Document Period End Date | Oct. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --04-30 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 849,904,665 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,017 | |
Entity Current Reporting Status | Yes | |
Entity Well Known Seasoned Issuer | No | |
Entity Voluntary Filers | No |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheet (Unaudited) - USD ($) | Oct. 31, 2016 | Apr. 30, 2016 |
Current Assets: | ||
Cash | $ 1,551,610 | $ 1,920,825 |
Prepaid expenses and other current assets | 51,112 | 110,026 |
Total Current Assets | 1,602,722 | 2,030,851 |
Other assets: | ||
Intangibles | 3,549,427 | 3,549,427 |
Investment in SG Austria | 1,572,193 | 1,572,193 |
Other assets | 7,372 | 7,854 |
Total other assets | 5,128,992 | 5,129,474 |
Total Assets | 6,731,714 | 7,160,325 |
Current Liabilities: | ||
Accounts payable | 300,896 | 336,009 |
Accrued expenses | 148,094 | 151,630 |
License agreement obligation | 0 | 150,000 |
Total current liabilities | 448,990 | 637,639 |
Total Liabilities | 448,990 | 637,639 |
Stockholders' Equity | ||
Common stock, authorized 1,490,000,000 shares, $0.0001 par value, 849,154,665 and 781,233,338 shares issued and outstanding as of October 31, 2016 and April 30, 2016, respectively | 84,916 | 78,127 |
Additional paid in capital | 92,894,298 | 91,135,370 |
Accumulated deficit | (86,698,134) | (84,691,617) |
Accumulated other comprehensive income | 1,644 | 806 |
Total stockholders' equity | 6,282,724 | 6,522,686 |
Total Liabilities and Stockholders' Equity | $ 6,731,714 | $ 7,160,325 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheet (Unaudited) (Parenthetical) - $ / shares | Oct. 31, 2016 | Apr. 30, 2016 |
Statement of Financial Position [Abstract] | ||
Common stock, authorized | 1,490,000,000 | 1,490,000,000 |
Common stock issued | 849,154,665 | 781,233,338 |
Common stock, outstanding | 849,154,665 | 781,233,338 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Revenues: | ||||
Revenue | $ 0 | $ 0 | $ 0 | $ 0 |
Cost of revenue | 0 | 0 | 0 | 0 |
Gross margin | 0 | 0 | 0 | 0 |
Operating Expenses: | ||||
Research and development costs | 253,768 | 439,711 | 428,772 | 595,389 |
Compensation expense | 491,472 | 400,507 | 906,478 | 848,077 |
Director fees | 9,000 | 9,000 | 18,000 | 27,000 |
Legal and professional fees | 56,760 | 57,988 | 234,765 | 183,063 |
General and administrative | 163,195 | 728,612 | 417,577 | 1,496,600 |
Total operating expenses | 974,195 | 1,635,818 | 2,005,592 | 3,150,129 |
Loss from operations | (974,195) | (1,635,818) | (2,005,592) | (3,150,129) |
Other income (expense): | ||||
Other income | 0 | 430 | 0 | 335 |
Interest expense | (356) | (194) | (925) | (826) |
Total other expense, net | (356) | 236 | (925) | (491) |
Net loss | $ (974,551) | $ (1,635,582) | $ (2,006,517) | $ (3,150,620) |
Basic and diluted loss per share | $ 0 | $ 0 | $ 0 | $ 0 |
Weighted average shares outstanding basic and diluted | 848,910,100 | 745,357,022 | 818,540,900 | 741,637,252 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Income Statement [Abstract] | ||||
Net Loss | $ (974,551) | $ (1,635,582) | $ (2,006,517) | $ (3,150,620) |
Other comprehensive income (loss): | ||||
Foreign currency translation | (390) | (34) | (1,644) | 1,587 |
Other comprehensive income (loss) | (390) | (34) | (1,644) | 1,587 |
Comprehensive loss | $ (974,941) | $ (1,635,616) | $ (2,008,161) | $ (3,149,033) |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (2,006,517) | $ (3,150,620) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Stock issued for services | 38,500 | 333,216 |
Stock issued for compensation | 143,760 | 254,040 |
Stock based compensation - options | 340,236 | 287,928 |
Stock based compensation - warrants | 0 | 679,930 |
Change in assets and liabilities: | ||
Increase (decrease) in prepaid expenses and current assets | 59,396 | (80,500) |
Decrease in accounts payable | (35,113) | (69,491) |
Increase (decrease) in accrued expenses | (3,536) | 29,130 |
Decrease in license agreement obligation | (150,000) | (400,000) |
Net cash used in operating activities | (1,613,274) | (2,116,367) |
Cash flows from investing activities: | ||
Net cash provided by (used in) investing activities | 0 | 0 |
Cash flows from financing activities: | ||
Proceeds from sale of common stock | 1,243,221 | 1,728,935 |
Net cash provided by financing activities | 1,243,221 | 1,728,935 |
Effect of currency rate exchange on cash | 838 | 125 |
Net decrease in cash | (369,215) | (387,307) |
Cash at beginning of the period | 1,920,825 | 2,699,737 |
Cash at end of the period | 1,551,610 | 2,312,430 |
Supplemental disclosures of cash flows information: | ||
Cash paid during the period for interest | $ 925 | $ 826 |
1. NATURE OF BUSINESS
1. NATURE OF BUSINESS | 6 Months Ended |
Oct. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS | Overview PharmaCyte Biotech, Inc. (“Company”) is a clinical stage biotechnology company focused on developing and preparing to commercialize treatments for cancer and diabetes based upon a proprietary cellulose-based live cell encapsulation technology known as “Cell-in-a-Box ® ® The Company is developing therapies for pancreatic and other solid cancerous tumors involving the encapsulation of live cells placed in the body to enable the delivery of cancer-killing drugs at the source of the cancer. In addition, the Company is developing a therapy for Type 1 diabetes and insulin-dependent Type 2 diabetes based upon the encapsulation of a human cell line genetically engineered to produce, store and secrete insulin at levels in proportion to the levels of blood sugar in the human body using the Cell-in-a-Box ® ® Cannabis Cancer Therapy Targeted Chemotherapy The Company is using the Cell-in-a-Box ® ® ® Pancreatic Cancer Therapy The Company is developing a therapy for pancreatic cancer to address a critical unmet medical need. This need exists for patients with advanced pancreatic cancer whose tumors are locally advanced, non-metastatic and inoperable but no longer respond to Abraxane ® Although several therapies have been tried in this situation, the most commonly used is believed to be the combination of the cancer chemotherapy drug capecitabine plus radiation (“CRT”). However, the results of a Phase 3 clinical trial were recently reported in the Journal of the American Medical Association. This clinical trial addressed whether CRT is more effective than chemotherapy alone. In patients with locally advanced, inoperable pancreatic cancer whose tumors no longer responded to gemcitabine or gemcitabine plus erlotinib (standard initial therapies at the time the clinical trial was conducted) patients were treated with the same chemotherapy or with CRT. In both cases CRT was not meaningfully more effective than chemotherapy alone. Subject to United States Food and Drug Administration (“FDA”) approval, the Company plans to commence a Phase 2b clinical trial. A Pre-Investigational New Drug (“Pre-IND”) meeting with the Center for Biologics Evaluation and Research (“CBER”) of the FDA has been granted by the FDA, although no assurance can be given as to when the meeting will be held or whether the FDA will approve the Company’s Investigational New Drug Application (“IND”). The trial is designed to show that the Company’s Cell-in-a-Box ® ® Malignant Ascites Fluid Therapy The Company is also developing a therapy to delay the production and accumulation of malignant ascites fluid that results from all abdominal tumors. Malignant ascites fluid is secreted by abdominal tumors into the abdomen after the tumor reaches a certain stage of growth. This fluid contains cancer cells that can seed and form new tumors throughout the abdomen. This fluid accumulates in the abdominal cavity, causing swelling of the abdomen, severe breathing difficulties and extreme pain. Malignant ascites fluid must be surgically removed on a periodic basis. This is painful and costly. There is no therapy that prevents or delays the production and accumulation of malignant ascites fluid. The Company has been involved in a series of preclinical studies at TD2 to determine if the combination of Cell-in-a-Box ® Diabetes Therapy Diabetes Diabetes is caused by insufficient availability of, or resistance to, insulin. Insulin is produced by the islet cells of the pancreas. Its function is to assist in the transport of sugar (glucose) in the blood to the inside of most types of cells in the body where it is used as a source of energy for those cells. In Type 1 diabetes the islet cells of the pancreas (the body’s insulin-producing cells) have been destroyed - usually by an autoimmune reaction. Type 1 diabetics require daily insulin administration through injection or through the use of an insulin pump. In Type 2 diabetes the body does not use insulin properly. This means the body has become resistant to insulin. Type 2 diabetes can generally be controlled by diet and exercise in its early stages. As time goes by, it may be necessary to use antidiabetic drugs to control the disease. However, over time these too may lose their effectiveness. Thus, even Type 2 diabetics may become insulin-dependent. Bio-Artificial Pancreas for Diabetes The Company plans to develop a therapy for Type 1 diabetes and insulin-dependent Type 2 diabetes. The Company is developing a therapy that involves encapsulation of human liver cells that have been genetically engineered to produce, store insulin and release insulin on demand at levels in proportion to the levels of blood sugar (glucose) in the human body. The encapsulation will be done using the Cell-in-a-Box ® In October 2014, the Company obtained from the University of Technology Sydney (“UTS”) in Australia an exclusive, worldwide license (“Melligen Cell License Agreement”) to use insulin-producing genetically engineered human cells developed by UTS to treat Type 1 diabetes and insulin-dependent Type 2 diabetes. These cells, named “Melligen,” have already been tested in mice and shown to produce insulin in direct proportion to the amount of glucose in their surroundings. When Melligen cells were transplanted into immunosuppressed diabetic mice, the blood glucose levels of the mice became normal. In other words, the Melligen cells reversed the diabetic condition. Austrianova Singapore Pte Ltd (“Austrianova”) has already successfully encapsulated live pig pancreatic islet insulin-producing cells using the Cell-in-a-Box ® ® In June 2013, the Company acquired from Austrianova an exclusive, worldwide license to use the Cell-in-a-Box ® ® ® ® Cannabis Therapy The Company plans to use Cannabis Cannabis ® It is believed that the constituents of the Cannabis inhibit or prevent the growth and spread of tumors or malignant cells. Cannabis ® In May 2014, the Company entered into a Research Agreement with the State of Colorado, acting on behalf of the Board of Trustees of the University of Northern Colorado. The goal of the ongoing research is to develop methods for the identification, separation and quantification of constitutes of Cannabis ® ® Company Background and Material Agreements The Company is a Nevada corporation incorporated in 1996. In 2013, it restructured its operations in an effort to focus on biotechnology. The restructuring resulted in the Company focusing all of its efforts upon the development of a novel, effective and safe way to treat cancer and diabetes. On January 6, 2015, the Company changed its name from Nuvilex, Inc. to PharmaCyte Biotech, Inc. to better reflect the nature of its business. In 2011, the Company entered into an Asset Purchase Agreement (“SG Austria APA”) with SG Austria Pte. Ltd. (“SG Austria”) to purchase 100% of the assets and liabilities of SG Austria. As a result, Austrianova and Bio Blue Bird AG ("Bio Blue Bird"), then wholly-owned subsidiaries of SG Austria, were to become wholly-owned subsidiaries of the Company on the condition that the Company pay SG Austria $2.5 million and 100,000,000 shares of the Company’s common stock. The Company was to receive 100,000 shares of common stock of Austrianova and nine bearer shares of Bio Blue Bird representing 100% of the ownership of Bio Blue Bird. Through two addenda to the SG Austria APA, the closing date of the SG Austria APA was extended twice by agreement between the parties. In June 2013, the Company and SG Austria entered into a Third Addendum to the SG Austria APA (“Third Addendum”). The Third Addendum changed materially the transaction contemplated by the SG Austria APA. Under the Third Addendum, the Company acquired 100% of the equity interests in Bio Blue Bird and received a 14.5% equity interest in SG Austria. In addition, the Company received nine bearer shares of Bio Blue Bird to reflect its 100% ownership of Bio Blue Bird. The Company paid: (i) $500,000 to retire all outstanding debt of Bio Blue Bird; and (ii) $1.0 million to SG Austria. The Company also paid SG Austria $1,572,193 in exchange for the 14.5% equity interest of SG Austria. The Third Addendum required SG Austria to return the 100,000,000 shares of the Company’s common stock held by SG Austria and for the Company to return the 100,000 shares of common stock of Austrianova the Company held. Effective as of the same date of the Third Addendum, the parties entered into a Clarification Agreement to the Third Addendum (“Clarification Agreement”) to clarify and include certain language that was inadvertently left out of the Third Addendum. Among other things, the Clarification Agreement confirmed that the Third Addendum granted the Company an exclusive, worldwide license to use, with a right to sublicense, the Cell-in-a-Box ® ® Bio Blue Bird licensed certain types of genetically modified human cells (“Cells”) from Bavarian Nordic A/S (“Bavarian Nordic”) and GSF-Forschungszentrum für Umwelt u. Gesundheit GmbH (collectively, “Bavarian Nordic/GSF”) pursuant to a License Agreement (“Bavarian Nordic/GSF License Agreement”) to develop a therapy for cancer using encapsulated Cells. The licensed rights to the Cells pertain to the countries in which Bavarian Nordic/GSF obtained patent protection. Hence, facilitated by the acquisition of Bio Blue Bird, the Third Addendum and the Clarification Agreement provide the Company with an exclusive, worldwide license to use the Cell-in-a-Box ® In June 2013, the Company entered into the Diabetes Licensing Agreement. The Company paid Austrianova $2.0 million to secure this license. In October 2014, the Company entered into the Melligen Cell License Agreement (defined below). The Company is in the process of developing a therapy for diabetes by encapsulating the Melligen cells using the Cell-in-a-Box ® In December 2014, the Company acquired from Austrianova an exclusive, worldwide license to use the Cell-in-a-Box ® ® In July 2016, the Company entered into a Binding Memorandum of Understanding with Austrianova (“Austrianova MOU”). Pursuant to the Austrianova MOU, Austrianova will actively work to seek an investment partner or partners who will finance clinical trials and further develop products for the therapies for cancer, in exchange for which we, Austrianova and any future investment partner or partners will each receive a share of the net revenue of applicable products in designated territories. Effective October 1, 2016, the parties amended the Bavarian Nordic/GSF License Agreement to include the right to import, reflect ownership and notification of improvements, clarify which provisions survive expiration or termination of the Bavarian Nordic/GSF License Agreement, to provide rights to Bio Blue Bird to the clinical data after expiration of the licensed patent rights and to change the notice address and recipients of Bio Blue Bird. |
2. LIQUIDITY AND MANAGEMENT PLA
2. LIQUIDITY AND MANAGEMENT PLANS | 6 Months Ended |
Oct. 31, 2016 | |
Liquidity And Management Plans | |
LIQUIDITY AND MANAGEMENT PLANS | Liquidity The Company's condensed consolidated financial statements are prepared using accounting principles generally accepted in the United States (“U.S. GAAP”) applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. As of October 31, 2016, the Company had an accumulated deficit of $86,698,134 and incurred a net loss for the six months ended October 31, 2016 of $2,006,517. During the six months ended October 31, 2016, approximately $1.3 million of funding was provided by investors to maintain and expand the Company’s operations. The remaining challenges, beyond the regulatory and clinical aspects, include accessing funding for the Company to cover its future cash flow needs. During the six months ended October 31, 2016, the Company acquired funds through the Company’s S-3 Registration Statement pursuant to which its exclusive placement agent, Chardan Capital Markets, LLC (“Chardan”), sold shares of common stock “at-the-market” or in negotiated block trades in a program which is structured to provide up to $50 million dollars to the Company less certain commissions. The Company requires substantial additional capital to finance its planned business operations and expects to incur operating losses in future periods due to the expenses related to the Company’s core businesses. The Company has not realized material revenue since it commenced doing business in the biotechnology sector, and there can be no assurance that it will be successful in generating revenues in the future in this sector. The Company believes that cash as of October 31, 2016, any sales of unregistered shares of its common stock and any public offerings of common stock the Company may engage in will provide sufficient capital to meet its capital requirements and to fund its operations through October 31, 2017. However, the Company’s ability to raise additional capital is limited by its inability to use a short form registration statement on Form S-3. As of the date of this Report, the Company does not meet the eligibility requirements in order for it to be able to conduct a primary offering of its common stock under Form S-3 or to file a new Registration Statement on Form S-3. The Company may be able to regain the use of Form S-3 if it meets one or both of the eligibility criteria, including: (i) the aggregate market value of the Company’s common stock held by non-affiliates exceeds $75 million; or (ii) the common stock is listed and registered on a national securities exchange. If the Company is not able to raise substantial additional capital in a timely manner, the Company may not be able to commence or complete its planned clinical trials and preclinical studies. The Company will continue to be dependent on outside capital to fund its research and operating expenditures for the foreseeable future. If the Company fails to generate positive cash flows or fails to obtain additional capital when required, the Company may need to modify, delay or abandon some or all of its business plans. Management Goal and Strategies to Implement The Company’s goal is to become an industry-leading biotechnology company using the Cell-in-a-Box ® The Company’s strategies to achieve this goal consist of the following: · The completion of clinical trials in locally advanced, inoperable non-metastatic pancreatic cancer and its associated pain; · The completion of preclinical studies and clinical trials that will demonstrate the effectiveness of the Company’s cancer therapy in reducing the production and accumulation of malignant ascites fluid in the abdomen that is characteristic of pancreatic and other abdominal cancers; · The completion of preclinical studies and clinical trials that involve the encapsulation of the Melligen cells using the Cell-in-a-Box ® · The enhancement of the Company’s ability to expand into the biotechnology arena through further research and partnering agreements in cancer and diabetes; · The acquisition of contracts that generate revenue or provide research and development capital utilizing the Company’s sublicensing rights; · The further development of uses of the Cell-in-a-Box ® · The completion of testing, expansion and marketing of existing and newly derived product candidates. |
3. SUMMARY OF SIGNIFICANT ACCOU
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Oct. 31, 2016 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | General The accompanying condensed consolidated financial statements as of October 31, 2016 and for the three and six months ended October 31, 2016 and 2015 are unaudited. These unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and are presented in accordance with the requirements of Regulation S-X of the Securities and Exchange Commission (“SEC”) and with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete condensed consolidated financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended October 31, 2016 are not necessarily indicative of the results that may be expected for the fiscal year ending April 30, 2017. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the fiscal year ended April 30, 2016 and footnotes thereto included in the Annual Report on Form 10-K of the Company filed with the SEC on July 29, 2016. The condensed consolidated balance sheet as of October 31, 2016 contained herein has been derived from the audited consolidated financial statements as of April 30, 2016, but does not include all disclosures required by U.S. GAAP. Principles of Consolidation and Basis of Presentation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. The Company operates independently and through four wholly-owned subsidiaries: (i) Bio Blue Bird; (ii) PharmaCyte Biotech Europe Limited; (iii) PharmaCyte Biotech Australia Pty. Ltd.; and (iv) Viridis Biotech, Inc. and are prepared in accordance with U.S. GAAP and the rules and regulations of the SEC. Intercompany balances and transactions are eliminated. The Company’s 14.5% investment in SG Austria is presented on the cost method of accounting. Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates these estimates including those related to fair values of financial instruments, intangible assets, fair value of stock-based awards, income taxes and contingent liabilities, among others. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of the Company’s consolidated financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions, which could have a material effect on the reported amounts of the Company’s consolidated financial position and results of operations. Intangible Assets The Financial Accounting Standards Board ("FASB") standard on goodwill and other intangible assets prescribes a two-step process for impairment testing of goodwill and indefinite-lived intangibles, which is performed annually, as well as when an event triggering impairment may have occurred. The first step tests for impairment, while the second step, if necessary, measures the impairment. The Company has elected to perform its annual analysis at the end of its reporting year. The Company’s intangible assets are licensing agreements related to the Cell-in-a-Box ® These intangible assets have an indefinite life; therefore, they are not amortizable. The Company concluded that there was no impairment of the carrying value of the intangibles for the six months ended October 31, 2016. Impairment of Long-Lived Assets The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be fully recoverable. If the estimated future cash flows (undiscounted and without interest charges) from the use of an asset are less than carrying value, a write-down would be recorded to reduce the related asset to its estimated fair value. No impairment was identified or recorded during the six months ended October 31, 2016. Fair Value of Financial Instruments For certain of the Company’s non-derivative financial instruments, including cash, accounts payable and accrued expenses, the carrying amount approximates fair value due to the short-term maturities of these instruments. Accounting Standards Codification ("ASC") Topic 820, “Fair Value Measurements and Disclosures,” requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, “Financial Instruments,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the consolidated balance sheets for current liabilities qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows: · Level 1. Observable inputs such as quoted prices in active markets; · Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and · Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The Company adopted ASC subtopic 820-10, Fair Value Measurements and Disclosures and Accounting Standards Codification subtopic 825-10, Financial Instruments, which permits entities to choose to measure many financial instruments and certain other items at fair value. Neither of these statements had an impact on the Company's financial position, results of operations or cash flows. The carrying value of cash, accounts payable and accrued expenses, as reflected in the consolidated balance sheets, approximate fair value because of the short-term maturity of these instruments. Income Taxes Deferred taxes are calculated using the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards 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 changes in tax laws and rates on the date of enactment. A valuation allowance is provided for deferred income tax assets when, in management’s judgment, based upon currently available information and other factors, it is more likely than not that all or a portion of such deferred income tax assets will not be realized. The determination of the need for a valuation allowance is based on an on-going evaluation of current information including, among other things, historical operating results, estimates of future earnings in different taxing jurisdictions and the expected timing of the reversals of temporary differences. The Company believes the determination to record a valuation allowance to reduce a deferred income tax asset is a significant accounting estimate because it is based, among other things, on an estimate of future taxable income in the U.S. and certain other jurisdictions, which is susceptible to change and may or may not occur, and because the impact of adjusting a valuation allowance may be material. In determining when to release the valuation allowance established against the Company’s net deferred income tax assets, the Company considers all available evidence, both positive and negative. Consistent with the Company’s policy, and because of the Company’s history of operating losses, the Company does not currently recognize the benefit of all of its deferred tax assets, including tax loss carry forwards, that may be used to offset future taxable income. The Company continually assesses its ability to generate sufficient taxable income during future periods in which deferred tax assets may be realized. If and when the Company believes it is more likely than not that it will recover its deferred tax assets, the Company will reverse the valuation allowance as an income tax benefit in the statements of operations. The Company accounts for its uncertain tax positions in accordance with U.S. GAAP. The purpose of this method is to clarify accounting for uncertain tax positions recognized. The U.S. GAAP method of accounting for uncertain tax positions utilizes a two-step approach to evaluate tax positions. Step one, recognition, requires evaluation of the tax position to determine if based solely on technical merits it is more likely than not to be sustained upon examination. Step two, measurement, is addressed only if a position is more likely than not to be sustained. In step two, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis, which is more likely than not to be realized upon ultimate settlement with tax authorities. If a position does not meet the more likely than not threshold for recognition in step one, no benefit is recorded until the first subsequent period in which the more likely than not standard is met, the issue is resolved with the taxing authority or the statute of limitations expires. Positions previously recognized are derecognized when the Company subsequently determines the position no longer is more likely than not to be sustained. Evaluation of tax positions, their technical merits and measurements using cumulative probability are highly subjective management estimates. Actual results could differ materially from these estimates. Research and Development Research and development expenses consist of costs incurred for direct and overhead-related research expenses and are expensed as incurred. Costs to acquire technologies, including licenses, that are utilized in research and development and that have no alternative future use are expensed when incurred. Technology developed for use in the Company’s product candidates is expensed as incurred until technological feasibility has been established. Under the Cannabis Licensing Agreement, the Company acquired from Austrianova an exclusive, world-wide license to use the Cell-in-a-Box ® Cannabis. Under the Cannabis Licensing Agreement, the Company is required to pay Austrianova an Upfront Payment (defined in Note 4) of $2,000,000. The Company has the right to make periodic monthly partial payments of the Upfront Payment in amounts to be agreed upon between the parties prior to each such payment being made. Under the Cannabis Licensing Agreement, the Company was required to pay the Upfront Payment in full by no later than June 30, 2016, and such obligation has been paid in full. As of October 31, 2016, the Company has paid Austrianova $2.0 million of the Upfront Payment. The $2 million cost of the license has been recorded as research and development costs. Research and development costs for the three and six months ended October 31, 2016 and 2015 were $253,768, $439,711, $428,772, and $595,389, respectively. Stock-Based Compensation The Company recognizes stock-based compensation expense for only those awards ultimately expected to vest on a straight-line basis over the requisite service period of the award, net of an estimated forfeiture rate. The Company estimates the fair value of stock options using a Black-Scholes-Merton valuation model, which requires the input of highly subjective assumptions, including the option's expected term and stock price volatility. In addition, judgment is also required in estimating the number of stock-based awards that are expected to be forfeited. Forfeitures are estimated based on historical experience at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The assumptions used in calculating the fair value of share-based payment awards represent management's best estimates, but these estimates involve inherent uncertainties and the application of management's judgment. As a result, if factors change and the Company uses different assumptions, its stock-based compensation expense could be materially different in the future. Concentration of Credit Risk The Company has no significant off-balance-sheet concentrations of credit risk such as foreign exchange contracts, options contracts or other foreign hedging arrangements. The Company maintains most of its cash balance at a financial institution located in California. Accounts at this institution are insured by the Federal Deposit Insurance Corporation up to $250,000. Uninsured balances aggregated approximately $1,302,000 and $1,656,000 at October 31, 2016 and April 30, 2016, respectively. The Company has not experienced any losses in such accounts, and management believes it is not exposed to any significant credit risk on cash. Foreign Currency Translation The Company translates the financial statements of its foreign subsidiary from the local (functional) currencies to U.S. dollars in accordance with FASB ASC 830, Foreign Currency Matters Recent Accounting Pronouncements ASU No. 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) ASU No. 2014-15, “Presentation of Financial Statements – Going Concern” “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” ASU No. 2016-09, Compensation—Stock Compensation In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 " Revenue from Contracts with Customers “Revenue Recognition”, “Other Assets and Deferred Costs—Contracts with Customers”. Revenue with Customers – Deferral of the Effective Date ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities ASU No. 2016-02, Leases |
4. LICENSE AGREEMENT OBLIGATION
4. LICENSE AGREEMENT OBLIGATION | 6 Months Ended |
Oct. 31, 2016 | |
License Agreement Obligation | |
LICENSE AGREEMENT OBLIGATION | The Company entered into a licensing agreement for a license to use the Cell-in-a-Box ® Cannabis |
5. COMMON STOCK TRANSACTIONS
5. COMMON STOCK TRANSACTIONS | 6 Months Ended |
Oct. 31, 2016 | |
Equity [Abstract] | |
COMMON STOCK TRANSACTIONS | The Company issued 3,600,000 shares of common stock to officers as part of their compensation agreements in the year ended April 30, 2015. These shares vest on a quarterly basis over a twelve-month period. During the three and six months ended October 31, 2015, 900,000 and 1,800,000 shares vested and the Company recorded a non-cash compensation expense of $80,010 and $190,530, respectively. The Company issued 1,200,000 shares of common stock to an employee as part of an employee agreement in the year ended April 30, 2015. These shares vest on a quarterly basis over a twelve-month period. During the three and six months ended October 31, 2015, 300,000 and 600,000 shares vested and the Company recorded a non-cash expense of $26,670 and $63,510, respectively. The Company awarded 3,600,000 shares of common stock to officers as part of their compensation agreements for 2016. These shares vest on a quarterly basis over a twelve-month period and are subject to their continuing service under the agreements. During the three and six months ended October 31, 2016, 900,000 and 1,800,000 shares vested and the Company recorded a non-cash compensation expense in the amount of $53,910 and $107,820, respectively. The Company awarded 1,200,000 shares of common stock to an employee as part of his compensation agreement for 2016. These shares vest on a quarterly basis over a twelve-month period and are subject to the employee providing services under the agreement. During the three and six months ended October 31, 2016, 300,000 and 600,000 shares vested and the Company recorded a non-cash compensation expense in the amount of $17,970 and $35,940, respectively. During the six months ended October 31, 2016, the Company issued 600,000 shares of common stock to a consultant. These shares vest on a quarterly basis over a twelve-month period and are subject to the consultant providing services under the agreement. During the three and six months ended October 31, 2016, 150,000 and 300,000 shares vested and the Company recorded a non-cash expense in the amount of $8,550 and $17,100, respectively. During the six months ended October 31, 2016, the Company issued 500,000 shares of common stock to two consultants. The terms of the agreements are for twelve months each. The shares vested upon issuance and the Company recorded a non-cash compensation expense in the amount of $21,400 for the three and six months ended October 31, 2016. All shares were issued without registration under the Securities Act of 1933, as amended (“Securities Act”), in reliance upon the exemption afforded by Section 4(a)(2) of the Securities Act. On October 28, 2014, the Company’s Registration on Form S-3 was declared effective by the Commission for a public offering of up to $50 million on a “shelf offering” basis. During the six months ended October 31, 2016 and 2015, the Company sold and issued approximately 66.8 and 14.7 million shares of common stock, respectively, at prices ranging from $0.02 to $0.16 per share. Net of underwriting discounts, legal, accounting and other offering expenses, the Company received proceeds of approximately $1.3 and $1.7 million from the sale of these shares for the six months ended October 31, 2016 and 2015, respectively. The Company has filed a prospectus supplement for an “at-the-market” offering with an investment bank as sales agent. As of October 31, 2016, the Company did not meet the eligibility requirements in order for it to be able to conduct a primary offering of its common stock under Form S-3 or to file a new Registration Statement on Form S-3. See Note 2 for additional information. A summary of the Company’s non-vested restricted stock activity and related weighted average grant date fair value information for the six months ended October 31, 2016 are as follows: Shares Weighted Average Grant Date Fair Value Non-vested, at April 30, 2016 3,600,000 $ 0.06 Granted 1,100,000 0.05 Vested (3,200,000 ) 0.06 Forfeited – – Non-vested, at October 31, 2016 1,500,000 $ 0.06 |
6. STOCK OPTIONS AND WARRANTS
6. STOCK OPTIONS AND WARRANTS | 6 Months Ended |
Oct. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK OPTIONS AND WARRANTS | Stock Options As of October 31, 2016, the Company had outstanding stock options held by its directors, officers, an employee, (“employee options”) and a consultant, (“non-employee options”) that were issued pursuant to compensation, director and consultant agreements. During the six months ended October 31, 2016 and 2015, the Company granted 13,100,000 and zero non-employee options, respectively. The non-employee options granted during the six months ended October 31, 2016 consist of 600,000 guaranteed options and 12,500,000 non-guaranteed performance based options. There were no employee options granted during the six months ended October 31, 2016 and 2015, respectively. The fair value of the non-employee options was estimated using the Black-Scholes-Merton option-pricing model, based on the following weighted average assumptions: Six Months Ended October 31, 2016 2015 Risk-free interest rate 1.31% – Expected volatility 105% – Expected lives (years) 5.0 – Expected dividend yield 0.00% – The Company’s computation of expected volatility is based on the historical daily volatility of its publicly traded stock. For stock option grants issued during three and six months ended October 31, 2016 and 2015, the Company used a calculated volatility for each grant. For employee options, the Company lacks adequate information about the exercise behavior at this time and has determined the expected term assumption under the simplified method provided for under ASC 718, which averages the contractual term of the Company’s stock options of five years with a typical vesting term of one year. For non-employee options, the Company used the contract term of five years to estimate the expected term as guided under ASC 505. The dividend yield assumption of zero is based upon the fact the Company has never paid cash dividends and presently has no intention of paying cash dividends. The risk-free interest rate used for each grant is equal to the U.S. Treasury rates in effect at the time of the grant for instruments with a similar expected life. Non-employee option grants that do not vest immediately upon grant are recorded as an expense over the vesting period. At the end of each financial reporting period, the value of these options, as calculated using the Black-Scholes-Merton option-pricing model, is determined, and compensation expense recognized or recovered during the period is adjusted accordingly. During the three and six months ended October 31, 2016, the values to account for the measurement on these vesting dates were approximately $0.04 and $0.04, respectively. As a result, the amount of the future compensation expense is subject to adjustment until the common stock options are fully vested. A summary of the Company’s stock option activity and related information for the six months ended October 31, 2016 are shown below: Options Weighted Average Exercise Price Weighted Average Grant Date Fair Value per Share Outstanding, April 30, 2016 68,050,000 $ 0.13 $ 0.09 Issued 13,100,000 0.07 0.04 Exercised – Total Outstanding, October 31, 2016 81,150,000 0.11 0.09 Total Exercisable, October 31, 2016 65,750,000 0.13 – Total Vested and expected to vest as of October 31, 2016 68,650,000 $ 0.13 – The Company recorded $164,363 and $142,962 of stock-based compensation expense related to the issuance of employee options in exchange for services during the three ended October 31, 2016 and 2015, respectively, and $328,726 and $285,924 during the six months ended October 31, 2016 and 2015, respectively. As of October 31, 2016 and 2015, there remained $109,576 and $238,266, respectively, of unrecognized compensation expense related to unvested employee options granted, to be recognized as expense over a weighted-average period of approximately one year. The non-vested employee options vest at 1,300,000 per month and are expected to be fully vested on December 31, 2016. The Company recorded $5,760, $11,510, zero and zero of stock-based compensation expense related to the issuance of non-employee options in exchange for services during the three and six months ended October 31, 2016 and 2015, respectively. The non-vested non-employee guaranteed options vest at 50,000 per month and are expected to be fully vested on April 30, 2017. The following table summarizes ranges of outstanding stock options by exercise price at October 31, 2016: Exercise Price Exercise Price $ 0.19 $ 0.11 $ 0.18 $ 0.063 $ 0.069 Number of Options Outstanding 25,000,000 27,200,000 250,000 15,600,000 13,100,000 Weighted Average Remaining Contractual Life (years) of Outstanding Options 2.92 3.17 3.47 4.17 4.50 Weighted Average Exercise Price $ 0.19 $ 0.11 $ 0.18 $ 0.063 $ 0.069 Number of Options Exercisable 25,000,000 27,200,000 250,000 13,000,000 300,000 Weighted Average Exercise Price of Exercisable Options $ 0.19 $ 0.11 $ 0.18 $ 0.063 $ 0.069 The aggregate intrinsic value of outstanding options as of October 31, 2016 was approximately $0. This represents options whose exercise price was less than the closing fair market value of the Company’s common stock on October 31, 2016 of approximately $0.04 per share. Warrants The warrants issued by the Company are classified as equity. The fair value of the warrants was recorded as additional-paid-in-capital, and no further adjustments are made. For stock warrants paid in consideration of services rendered by non-employees, the Company recognizes consulting expense in accordance with the requirements of ASC 505-50 and ASC 505, as amended. A summary of the Company’s warrant activity and related information for the three and six months ended October 31, 2016 are shown below: Warrants Weighted Average Exercise Price Outstanding, April 30, 2016 84,969,908 $ 0.16 Issued – – Expired – – Total Outstanding, October 31, 2016 84,969,908 0.16 Total Exercisable, October 31, 2016 84,969,908 $ 0.16 The following table summarizes additional information concerning warrants outstanding and exercisable at October 31, 2016: Range of Exercise Prices Number of Warrant Shares Exercisable at 10/31/2016 Weighted Average Remaining Contractual Life Weighted Average Exercise Price $0.075, $0.11, $0.12, $0.18 and $0.25 84,969,908 2.05 $ 0.16 Five Year Term - $0.075 1,056,000 0.94 Five Year Term - $0.12 35,347,508 2.66 Five Year Term - $0.18 19,811,200 1.16 Five Year Term - $0.25 18,755,200 1.18 Five Year Term - $0.11 10,000,000 3.39 84,969,908 |
7. LEGAL PROCEEDINGS
7. LEGAL PROCEEDINGS | 6 Months Ended |
Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | The Company is not currently a party to any pending legal proceedings, material or otherwise. There are no legal proceedings to which any property of the Company is subject. However, in the past the Company has been the subject of litigation, claims and assessments arising out of matters occurring in its normal business operations. In the opinion of management, none of these had a material adverse effect on the Company’s unaudited condensed consolidated financial position, operations and cash flows presented in this Quarterly Report on Form 10-Q. |
8. RELATED PARTY TRANSACTIONS
8. RELATED PARTY TRANSACTIONS | 6 Months Ended |
Oct. 31, 2016 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | The Company had the following related party transactions. The Company owns 14.5% of the equity in SG Austria and is reported on the cost method of accounting. SG Austria has two subsidiaries: (i) Austrianova; and (ii) Austrianova Thailand Ltd. The Company purchased products from these subsidiaries in the approximate amounts of $95,073 and $155,255 in the three months ended October 31, 2016 and 2015, respectively, and $144,843 and $202,942 in the six months ended October 31, 2016 and 2015, respectively. In April 2014, the Company entered into a consulting agreement with Vin-de-Bona Trading Company Pte. Ltd. (“Vin-de-Bona”) pursuant to which Vin-de-Bona agreed to provide professional consulting services to the Company. Vin-de-Bona is owned by Prof. Walter H. Günzburg and Dr. Brian Salmons. The term of the agreement is for 12 months, automatically renewable for successive 12 month terms. After the initial term, either party can terminate the agreement by giving the other party 30 days’ written notice before the effective date of termination. The amounts paid for the three months ended October 31, 2016 and 2015 are approximately $13,910 and $8,740, respectively, and the amounts paid for the six months ended October 31, 2016 and 2015 are approximately $41,705 and $18,885, respectively. Under the Cannabis Licensing Agreement, the Company acquired from Austrianova an exclusive, world-wide license to use the Cell-in-a-Box ® Cannabis. Under the Cannabis Licensing Agreement, the Company is required to pay Austrianova an Upfront Payment of $2,000,000. The Company has the right to make periodic monthly partial payments of the Upfront Payment in amounts to be agreed upon between the parties prior to each such payment being made. Under the Cannabis Licensing Agreement, as amended, the Upfront Payments must be paid in full by no later than June 30, 2016. As of October 31, 2016 and 2015, the Company has paid Austrianova $2.0 million and $1.4 million of the Upfront Payment, respectively. With the exception of Thomas Liquard, the Board has determined that none of the Company’s directors satisfies the definition of Independent Director as established in the NASDAQ Marketplace Rules. Mr. Liquard has been determined by the Board to be an Independent Director. |
9. COMMITMENTS AND CONTINGENCIE
9. COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | The Company acquires assets still in development and enters into research and development arrangements with third parties that often require milestone and royalty payments to the third party contingent upon the occurrence of certain future events linked to the success of the asset in development. Milestone payments may be required, contingent upon the successful achievement of an important point in the development life-cycle of the pharmaceutical product (e.g., approval of the product for marketing by a regulatory agency). If required by the license agreements, the Company may have to make royalty payments based upon a percentage of the sales of the pharmaceutical products in the event that regulatory approval for marketing is obtained. Office Lease The Company formerly leased office space at 12510 Prosperity Drive, Suite 310, Silver Spring, Maryland 20904. The term of the lease expired on July 31, 2016 and was extended to August 31, 2016 at the same amount of monthly rent. The Company entered into a new office lease agreement effective on September 1, 2016. The term of the lease is twelve months. The leased premises are located at 23046 Avenida de la Carlota, Suite 600, Laguna Hills, California 92653. Rent expense for these offices for the three and six months ended October 31, 2016 and 2015 were $9,577 and $17,114, respectively, and were $23,429 and $29,612 for the six months ended October 31, 2016 and 2015, respectively. The following table summarizes the Company’s aggregate future minimum lease payments required under the operating lease as of October 31, 2016. Period ending, October 31, Amount 2017 $ 18,430 2018 12,007 $ 30,437 License Agreements The Third Addendum The Third Addendum requires the Company to make future royalty and milestone payments as follows: · Two percent royalty on all gross sales received by the Company or its affiliates; · Ten percent royalty on gross revenues received by the Company or its affiliates from any sublicense or right to use the patents or the licenses granted by the Company or its affiliates; · Milestone payments of $100,000 due 30 days after enrollment of the first human patient in the first clinical trial for each product; $300,000 due 30 days after enrollment of the first human patient in the first Phase 3 clinical trial for each product; and $800,000 due 60 days after having a marketing application approved by the applicable regulatory authority for each product; and · Milestone payments of $50,000 due 30 days after enrollment of the first veterinary patient in the first trial for each product and $300,000 due 60 days after having a marketing application approved by the applicable regulatory authority for each veterinary product. In addition, the parties to the Third Addendum entered into a Manufacturing Framework Agreement pursuant to which the Company is required to pay a fee for producing the final encapsulated cell product of $647 per vial of 300 capsules after production with a minimum purchased batch size of 400 vials of any Cell-in-a-Box® product. The fees under the Manufacturing Framework Agreement are subject to annual increases according to the annual inflation rate in the country in which the encapsulated cell products are manufactured. Diabetes Licensing Agreement The Diabetes Licensing Agreement requires the Company to pay a fee for producing the final encapsulated cell product of $633.14 per vial of 300 capsules after production with a minimum purchased batch size of 400 vials of any Cell-in-a-Box ® The Diabetes Licensing Agreement requires the Company to make future royalty and milestone payments as follows: (i) ten percent royalty of the gross sale of all products the Company sells; (ii) twenty percent royalty of the amount actually received by the Company from sub-licensees on sub-licensees’ gross sales; (iii) milestone payments of $100,000 within 30 days of beginning the first pre-clinical experiments using the encapsulated cells; (iv) $500,000 within 30 days after enrollment of the first human patient in the first clinical trial; (v) $800,000 within 30 days after enrollment of the first human patient in the first Phase 3 clinical trial; and (vi) $1,000,000 due 60 days after having a marketing application approved by the applicable regulatory authority for each product. Melligen Cell License Agreement The Melligen Cell License Agreement, as amended, does not require any “up-front” payment to UTS. The Company is required to pay the patent prosecution and maintenance costs and to pay to UTS a patent administration fee amounting to 15% on all amounts paid by UTS to prosecute and maintain patents related to the licensed property. The Melligen Cell License Agreement requires that the Company pay royalty payments to UTS of (i) six percent gross exploitation revenue on product sales; and (ii) twenty-five percent of gross revenues if the product is sub-licensed by the Company. In addition, the Company is required to pay milestone payments of: (iii) AU$ 50,000 at the successful conclusion of Pre-clinical studies; (iv) AU$ 100,000 at the successful conclusion of Phase 1 clinical trials; (v) AU$ 450,000 at the successful conclusion of Phase 2 clinical trials; and (vi) AU$ 3,000,000 at the conclusion of Phase 3 clinical trials. Cannabis Licensing Agreement Under the Cannabis Licensing Agreement, the Company is required to pay Austrianova an Upfront Payment of $2,000,000. The Company has the right to make periodic monthly partial payments of the Upfront Payment in amounts to be agreed upon between the parties prior to each such payment being made. Under the Cannabis Licensing Agreement, as amended, the Upfront Payments must be paid in full by no later than June 30, 2016. As of October 31, 2016, the Company has paid Austrianova $2.0 million of the Upfront Payment (see Note 4). The Cannabis Licensing Agreement requires the Company to pay Austrianova, pursuant to a manufacturing agreement between the parties, a one-time manufacturing setup fee in the amount of $800,000, of which 50% is required to be paid on the signing of a manufacturing agreement for a product and 50% is required to be paid three months later. As of October 31, 2016, the manufacturing agreement remains unsigned. In addition, the Cannabis Licensing Agreement requires the Company to pay a fee for producing the final encapsulated cell product of $800 per vial of 300 capsules after production with a minimum purchased batch size of 400 vials of any Cell-in-a-Box ® The Cannabis Licensing Agreement requires the Company to make future royalty and milestone payments as follows: (i) ten percent royalty of the gross sale of all products sold by the Company; (ii) twenty percent royalty of the amount actually received by the Company from sub-licensees on sub-licensees’ gross sales value; (iii) a milestone payment of $100,000 within 30 days of beginning the first pre-clinical experiments using the encapsulated cells; (iv) a milestone payment of $500,000 within 30 days after enrollment of the first human patient in the first clinical trial; (v) a milestone payment of $800,000 within 30 days after enrollment of the first human patient in the first Phase 3 clinical trial; and (vi) a milestone payment of $1,000,000 due 90 days after having a marketing application approved by the applicable regulatory authority for each product. Consulting Agreement with ViruSure The Company has engaged ViruSure, a professional cell growing and adventitious agent testing company that has had extensive experience with the CYP2B1-expressing cells that will be needed for the Company’s pancreatic cancer therapy. The Company did so in order to recover them from frozen stocks of similar cells and regenerate new stocks for use by the Company in its preclinical studies and clinical trials. ViruSure is in the process of cloning new cells from a selected clone. Those clones will be grown to populate a Master Cell Bank and a Working Cell Bank for the Company’s future clinical trials. There are approximately $186,500 in future milestone payments relating to testing to be completed. Compensation Agreements The Company entered into executive compensation agreements with its two executive officers and an employment agreement with one of its employees in March 2015, each of which was amended in December 2015. Each agreement has a term of two years. The Company also entered into a compensation agreement with a Board member in April 2015 which continues in effect until the member is no longer on the Board. |
10. INCOME TAXES
10. INCOME TAXES | 6 Months Ended |
Oct. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | The Company had no income tax expense for the three and six months ended October 31, 2016 and 2015, respectively. During the six months ended October 31, 2016 and 2015, the Company had a net operating loss (“NOL”) for each period which generated deferred tax assets for NOL carryforwards. The Company provided valuation allowances against the net deferred tax assets including the deferred tax assets for NOL carryforwards. Valuation allowances provided for the net deferred tax asset increased by approximately $718,000 and $544,000 for the six months ended October 31, 2016 and 2015, respectively. There was no material difference between the effective tax rate and the projected blended statutory tax rate for the six months ended October 31, 2016 and 2015. In assessing the realization of deferred tax assets, management considered whether it is more likely than not that some portion or all of the deferred asset will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Based on the available objective evidence, including the history of operating losses and the uncertainty of generating future taxable income, management believes it is more likely than not that the net deferred tax assets at October 31, 2016 will not be fully realizable. Accordingly, management has maintained a valuation allowance against the net deferred tax assets at October 31, 2016. There have been no changes to the Company’s liability for unrecognized tax benefits during the six months ended October 31, 2016. The Company’s policy is to recognize any interest and penalties related to unrecognized tax benefits as a component of income tax expense. As of the six months ended October 31, 2016 and 2015, the Company had accrued no interest or penalties related to uncertain tax positions. See Note 13 of Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the year ended April 30, 2016 for additional information regarding income taxes. |
11. EARNINGS PER SHARE
11. EARNINGS PER SHARE | 6 Months Ended |
Oct. 31, 2016 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | Basic earnings (loss) per share is computed by dividing earnings available to common stockholders by the weighted average number of shares outstanding during the period. Diluted earnings per share is computed by dividing net income by the weighted average number of shares and potentially dilutive common shares outstanding during the period increased to include the number of additional shares of common stock that would be outstanding if the potentially dilutive securities had been issued. Potential common shares outstanding principally include stock options and warrants. During the three and six months ended October 31, 2016 and 2015, the Company incurred losses. Accordingly, the effect of any common stock equivalent would be anti-dilutive during those periods and are not included in the calculation of diluted weighted average number of shares outstanding. The table below sets forth the basic and diluted loss per share calculations: Six Months Ended October 31, 2016 2015 Net loss $ (2,006,517 ) $ (3,150,620 ) Basic weighted average number of shares outstanding 818,540,900 741,637,252 Diluted weighted average number of shares outstanding 818,540,900 741,637,252 Basic and diluted loss per share $ (0.00 ) (0.00 ) The table below sets forth these potentially dilutive securities: Six Months Ended October 31, 2016 2015 Excluded options 81,150,000 52,450,000 Excluded warrants 84,969,908 72,969,908 Total excluded options and warrants 166,119,908 125,419,908 The table below sets forth the basic and diluted loss per share calculations: Three Months Ended October 31, 2016 2015 Net loss $ (974,551 ) $ (1,635,582 ) Basic weighted average number of shares outstanding 848,910,100 745,357,022 Diluted weighted average number of shares outstanding 848,910,100 745,357,022 Basic and diluted loss per share $ (0.00 ) (0.00 ) The table below sets forth these potentially dilutive securities: Three Months Ended October 31, 2016 2015 Excluded options 81,150,000 52,450,000 Excluded warrants 84,969,908 72,969,908 Total excluded options and warrants 166,119,908 125,419,908 |
3. SUMMARY OF SIGNIFICANT ACC18
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Oct. 31, 2016 | |
Accounting Policies [Abstract] | |
Organization/General | General The accompanying condensed consolidated financial statements as of October 31, 2016 and for the three and six months ended October 31, 2016 and 2015 are unaudited. These unaudited condensed consolidated financial statements have been prepared in accordance with U.S. GAAP for interim financial information and are presented in accordance with the requirements of Regulation S-X of the Securities and Exchange Commission (“SEC”) and with the instructions to Form 10-Q. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete condensed consolidated financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three and six months ended October 31, 2016 are not necessarily indicative of the results that may be expected for the fiscal year ending April 30, 2017. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the fiscal year ended April 30, 2016 and footnotes thereto included in the Annual Report on Form 10-K of the Company filed with the SEC on July 29, 2016. The condensed consolidated balance sheet as of October 31, 2016 contained herein has been derived from the audited consolidated financial statements as of April 30, 2016, but does not include all disclosures required by U.S. GAAP. |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. The Company operates independently and through four wholly-owned subsidiaries: (i) Bio Blue Bird; (ii) PharmaCyte Biotech Europe Limited; (iii) PharmaCyte Biotech Australia Pty. Ltd.; and (iv) Viridis Biotech, Inc. and are prepared in accordance with U.S. GAAP and the rules and regulations of the SEC. Intercompany balances and transactions are eliminated. The Company’s 14.5% investment in SG Austria is presented on the cost method of accounting. |
Use of Estimates | Use of Estimates The preparation of financial statements in accordance with U.S. GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates these estimates including those related to fair values of financial instruments, intangible assets, fair value of stock-based awards, income taxes and contingent liabilities, among others. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of the Company’s consolidated financial statements; accordingly, it is possible that the actual results could differ from these estimates and assumptions, which could have a material effect on the reported amounts of the Company’s consolidated financial position and results of operations. |
Intangible Assets | Intangible Assets The Financial Accounting Standards Board ("FASB") standard on goodwill and other intangible assets prescribes a two-step process for impairment testing of goodwill and indefinite-lived intangibles, which is performed annually, as well as when an event triggering impairment may have occurred. The first step tests for impairment, while the second step, if necessary, measures the impairment. The Company has elected to perform its annual analysis at the end of its reporting year. The Company’s intangible assets are licensing agreements related to the Cell-in-a-Box ® These intangible assets have an indefinite life; therefore, they are not amortizable. The Company concluded that there was no impairment of the carrying value of the intangibles for the six months ended October 31, 2016. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be fully recoverable. If the estimated future cash flows (undiscounted and without interest charges) from the use of an asset are less than carrying value, a write-down would be recorded to reduce the related asset to its estimated fair value. No impairment was identified or recorded during the six months ended October 31, 2016. |
Fair value of Financial Instruments | Fair Value of Financial Instruments For certain of the Company’s non-derivative financial instruments, including cash, accounts payable and accrued expenses, the carrying amount approximates fair value due to the short-term maturities of these instruments. Accounting Standards Codification ("ASC") Topic 820, “Fair Value Measurements and Disclosures,” requires disclosure of the fair value of financial instruments held by the Company. ASC Topic 825, “Financial Instruments,” defines fair value, and establishes a three-level valuation hierarchy for disclosures of fair value measurement that enhances disclosure requirements for fair value measures. The carrying amounts reported in the consolidated balance sheets for current liabilities qualify as financial instruments and are a reasonable estimate of their fair values because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The three levels of valuation hierarchy are defined as follows: · Level 1. Observable inputs such as quoted prices in active markets; · Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and · Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. The Company adopted ASC subtopic 820-10, Fair Value Measurements and Disclosures and Accounting Standards Codification subtopic 825-10, Financial Instruments, which permits entities to choose to measure many financial instruments and certain other items at fair value. Neither of these statements had an impact on the Company's financial position, results of operations or cash flows. The carrying value of cash, accounts payable and accrued expenses, as reflected in the consolidated balance sheets, approximate fair value because of the short-term maturity of these instruments. |
Income Taxes | Income Taxes Deferred taxes are calculated using the liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carry forwards 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 changes in tax laws and rates on the date of enactment. A valuation allowance is provided for deferred income tax assets when, in management’s judgment, based upon currently available information and other factors, it is more likely than not that all or a portion of such deferred income tax assets will not be realized. The determination of the need for a valuation allowance is based on an on-going evaluation of current information including, among other things, historical operating results, estimates of future earnings in different taxing jurisdictions and the expected timing of the reversals of temporary differences. The Company believes the determination to record a valuation allowance to reduce a deferred income tax asset is a significant accounting estimate because it is based, among other things, on an estimate of future taxable income in the U.S. and certain other jurisdictions, which is susceptible to change and may or may not occur, and because the impact of adjusting a valuation allowance may be material. In determining when to release the valuation allowance established against the Company’s net deferred income tax assets, the Company considers all available evidence, both positive and negative. Consistent with the Company’s policy, and because of the Company’s history of operating losses, the Company does not currently recognize the benefit of all of its deferred tax assets, including tax loss carry forwards, that may be used to offset future taxable income. The Company continually assesses its ability to generate sufficient taxable income during future periods in which deferred tax assets may be realized. If and when the Company believes it is more likely than not that it will recover its deferred tax assets, the Company will reverse the valuation allowance as an income tax benefit in the statements of operations. The Company accounts for its uncertain tax positions in accordance with U.S. GAAP. The purpose of this method is to clarify accounting for uncertain tax positions recognized. The U.S. GAAP method of accounting for uncertain tax positions utilizes a two-step approach to evaluate tax positions. Step one, recognition, requires evaluation of the tax position to determine if based solely on technical merits it is more likely than not to be sustained upon examination. Step two, measurement, is addressed only if a position is more likely than not to be sustained. In step two, the tax benefit is measured as the largest amount of benefit, determined on a cumulative probability basis, which is more likely than not to be realized upon ultimate settlement with tax authorities. If a position does not meet the more likely than not threshold for recognition in step one, no benefit is recorded until the first subsequent period in which the more likely than not standard is met, the issue is resolved with the taxing authority or the statute of limitations expires. Positions previously recognized are derecognized when the Company subsequently determines the position no longer is more likely than not to be sustained. Evaluation of tax positions, their technical merits and measurements using cumulative probability are highly subjective management estimates. Actual results could differ materially from these estimates. |
Research and Development | Research and Development Research and development expenses consist of costs incurred for direct and overhead-related research expenses and are expensed as incurred. Costs to acquire technologies, including licenses, that are utilized in research and development and that have no alternative future use are expensed when incurred. Technology developed for use in the Company’s product candidates is expensed as incurred until technological feasibility has been established. Under the Cannabis Licensing Agreement, the Company acquired from Austrianova an exclusive, world-wide license to use the Cell-in-a-Box ® Cannabis. Under the Cannabis Licensing Agreement, the Company is required to pay Austrianova an Upfront Payment (defined in Note 4) of $2,000,000. The Company has the right to make periodic monthly partial payments of the Upfront Payment in amounts to be agreed upon between the parties prior to each such payment being made. Under the Cannabis Licensing Agreement, the Company was required to pay the Upfront Payment in full by no later than June 30, 2016, and such obligation has been paid in full. As of October 31, 2016, the Company has paid Austrianova $2.0 million of the Upfront Payment. The $2 million cost of the license has been recorded as research and development costs. Research and development costs for the three and six months ended October 31, 2016 and 2015 were $253,768, $439,711, $428,772, and $595,389, respectively. |
Stock-Based Compensation | Stock-Based Compensation The Company recognizes stock-based compensation expense for only those awards ultimately expected to vest on a straight-line basis over the requisite service period of the award, net of an estimated forfeiture rate. The Company estimates the fair value of stock options using a Black-Scholes-Merton valuation model, which requires the input of highly subjective assumptions, including the option's expected term and stock price volatility. In addition, judgment is also required in estimating the number of stock-based awards that are expected to be forfeited. Forfeitures are estimated based on historical experience at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. The assumptions used in calculating the fair value of share-based payment awards represent management's best estimates, but these estimates involve inherent uncertainties and the application of management's judgment. As a result, if factors change and the Company uses different assumptions, its stock-based compensation expense could be materially different in the future. |
Concentration of Credit Risk | Concentration of Credit Risk The Company has no significant off-balance-sheet concentrations of credit risk such as foreign exchange contracts, options contracts or other foreign hedging arrangements. The Company maintains most of its cash balance at a financial institution located in California. Accounts at this institution are insured by the Federal Deposit Insurance Corporation up to $250,000. Uninsured balances aggregated approximately $1,302,000 and $1,656,000 at October 31, 2016 and April 30, 2016, respectively. The Company has not experienced any losses in such accounts, and management believes it is not exposed to any significant credit risk on cash. |
Foreign Currency Translation | Foreign Currency Translation The Company translates the financial statements of its foreign subsidiary from the local (functional) currencies to U.S. dollars in accordance with FASB ASC 830, Foreign Currency Matters |
Recent accounting pronouncements | Recent Accounting Pronouncements ASU No. 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) ASU No. 2014-15, “Presentation of Financial Statements – Going Concern” “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern.” ASU No. 2016-09, Compensation—Stock Compensation In May 2014, the FASB issued Accounting Standards Update (“ASU”) No. 2014-09 " Revenue from Contracts with Customers “Revenue Recognition”, “Other Assets and Deferred Costs—Contracts with Customers”. Revenue with Customers – Deferral of the Effective Date ASU No. 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities ASU No. 2016-02, Leases |
5. COMMON STOCK TRANSACTIONS (T
5. COMMON STOCK TRANSACTIONS (Tables) | 6 Months Ended |
Oct. 31, 2016 | |
Common Stock Transactions Tables | |
Schedule of non-vested restricted stock activity | Shares Weighted Average Grant Date Fair Value Non-vested, at April 30, 2016 3,600,000 $ 0.06 Granted 1,100,000 0.05 Vested (3,200,000 ) 0.06 Forfeited – – Non-vested, at October 31, 2016 1,500,000 $ 0.06 |
6. STOCK OPTIONS AND WARRANTS (
6. STOCK OPTIONS AND WARRANTS (Tables) | 6 Months Ended |
Oct. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Assumptions | Six Months Ended October 31, 2016 2015 Risk-free interest rate 1.31% – Expected volatility 105% – Expected lives (years) 5.0 – Expected dividend yield 0.00% – |
Employee stock option activity | Options Weighted Average Exercise Price Weighted Average Grant Date Fair Value per Share Outstanding, April 30, 2016 68,050,000 $ 0.13 $ 0.09 Issued 13,100,000 0.07 0.04 Exercised – Total Outstanding, October 31, 2016 81,150,000 0.11 0.09 Total Exercisable, October 31, 2016 65,750,000 0.13 – Total Vested and expected to vest as of October 31, 2016 68,650,000 $ 0.13 – |
Outstanding stock options by exercise price | Exercise Price Exercise Price $ 0.19 $ 0.11 $ 0.18 $ 0.063 $ 0.069 Number of Options Outstanding 25,000,000 27,200,000 250,000 15,600,000 13,100,000 Weighted Average Remaining Contractual Life (years) of Outstanding Options 2.92 3.17 3.47 4.17 4.50 Weighted Average Exercise Price $ 0.19 $ 0.11 $ 0.18 $ 0.063 $ 0.069 Number of Options Exercisable 25,000,000 27,200,000 250,000 13,000,000 300,000 Weighted Average Exercise Price of Exercisable Options $ 0.19 $ 0.11 $ 0.18 $ 0.063 $ 0.069 |
Warrant activity | Warrants Weighted Average Exercise Price Outstanding, April 30, 2016 84,969,908 $ 0.16 Issued – – Expired – – Total Outstanding, October 31, 2016 84,969,908 0.16 Total Exercisable, October 31, 2016 84,969,908 $ 0.16 |
Schedule of warrants outstanding by exercise prices | Range of Exercise Prices Number of Warrant Shares Exercisable at 10/31/2016 Weighted Average Remaining Contractual Life Weighted Average Exercise Price $0.075, $0.11, $0.12, $0.18 and $0.25 84,969,908 2.05 $ 0.16 Five Year Term - $0.075 1,056,000 0.94 Five Year Term - $0.12 35,347,508 2.66 Five Year Term - $0.18 19,811,200 1.16 Five Year Term - $0.25 18,755,200 1.18 Five Year Term - $0.11 10,000,000 3.39 84,969,908 |
9. COMMITMENTS AND CONTINGENC21
9. COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Oct. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of operating leases | Period ending, October 31, Amount 2017 $ 18,430 2018 12,007 $ 30,437 |
11. EARNINGS PER SHARE (Tables)
11. EARNINGS PER SHARE (Tables) | 6 Months Ended |
Oct. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per share calculations | Six Months Ended October 31, 2016 2015 Net loss $ (2,006,517 ) $ (3,150,620 ) Basic weighted average number of shares outstanding 818,540,900 741,637,252 Diluted weighted average number of shares outstanding 818,540,900 741,637,252 Basic and diluted loss per share $ (0.00 ) (0.00 ) Three Months Ended October 31, 2016 2015 Net loss $ (974,551 ) $ (1,635,582 ) Basic weighted average number of shares outstanding 848,910,100 745,357,022 Diluted weighted average number of shares outstanding 848,910,100 745,357,022 Basic and diluted loss per share $ (0.00 ) (0.00 ) |
Schedule of potentially dilutive securities | Six Months Ended October 31, 2016 2015 Excluded options 81,150,000 52,450,000 Excluded warrants 84,969,908 72,969,908 Total excluded options and warrants 166,119,908 125,419,908 The table below sets forth these potentially dilutive securities: Three Months Ended October 31, 2016 2015 Excluded options 81,150,000 52,450,000 Excluded warrants 84,969,908 72,969,908 Total excluded options and warrants 166,119,908 125,419,908 |
2. LIQUIDITY AND MANAGEMENT P23
2. LIQUIDITY AND MANAGEMENT PLANS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Apr. 30, 2016 | |
Liquidity And Management Plans | |||||
Accumulated deficit | $ (86,698,134) | $ (86,698,134) | $ (84,691,617) | ||
Net loss | $ (974,551) | $ (1,635,582) | $ (2,006,517) | $ (3,150,620) |
3. SUMMARY OF SIGNIFICANT ACC24
3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Apr. 30, 2016 | |
Property, Plant and Equipment [Line Items] | |||||
Intangible assets | $ 3,549,427 | $ 3,549,427 | $ 3,549,427 | ||
Impairment of intangible assets | 0 | ||||
Research and development costs | 253,768 | $ 439,711 | 428,772 | $ 595,389 | |
Uninsured cash balances | 1,302,000 | 1,302,000 | $ 1,656,000 | ||
Cell-in-a-Box [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Intangible assets | 1,549,427 | 1,549,427 | |||
Diabetes License [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Intangible assets | $ 2,000,000 | $ 2,000,000 | |||
SG Austria [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Percentage investment in SG Austria | 14.50% | 14.50% |
4. LICENSE AGREEMENT OBLIGATI25
4. LICENSE AGREEMENT OBLIGATION (Details Narrative) - USD ($) | Oct. 31, 2016 | Apr. 30, 2016 |
License Agreement Obligation | ||
License payable | $ 0 | $ 150,000 |
5. COMMON STOCK TRANSACTIONS (D
5. COMMON STOCK TRANSACTIONS (Details - Nonvested Option activity) - Restricted Stock [Member] | 6 Months Ended |
Oct. 31, 2016$ / sharesshares | |
Options Outstanding | |
Beginning balance | shares | 3,600,000 |
Granted | shares | 1,100,000 |
Vested | shares | (3,200,000) |
Forfeited | shares | 0 |
Ending balance | shares | 1,500,000 |
Weighted Average Grant Date Fair Value | |
Beginning balance | $ / shares | $ .06 |
Granted | $ / shares | .05 |
Vested | $ / shares | .06 |
Forfeited | $ / shares | |
Ending balance | $ / shares | $ .06 |
5. COMMON STOCK TRANSACTIONS 27
5. COMMON STOCK TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | Apr. 30, 2015 | |
Stock based compensation expense | $ 143,760 | $ 254,040 | |||
Stock issued new, shares | 66,800,000 | 14,700,000 | |||
Proceeds from sale of common stock | $ 1,243,221 | $ 1,728,935 | |||
Common Stock [Member] | Officers [Member] | |||||
Stock issued for compensation, shares | 3,600,000 | 3,600,000 | |||
Common stock vested | 900,000 | 900,000 | 1,800,000 | 1,800,000 | |
Stock based compensation expense | $ 53,910 | $ 80,010 | $ 107,820 | $ 190,530 | |
Common Stock [Member] | Employee [Member] | |||||
Stock issued for compensation, shares | 1,200,000 | 1,200,000 | |||
Common stock vested | 300,000 | 300,000 | 600,000 | 600,000 | |
Stock based compensation expense | $ 17,970 | $ 26,670 | $ 35,940 | $ 63,510 | |
Common Stock [Member] | Consultant [Member] | |||||
Stock issued for compensation, shares | 600,000 | ||||
Common stock vested | 150,000 | 300,000 | |||
Stock based compensation expense | $ 8,550 | $ 17,100 | |||
Common Stock [Member] | Two Consultants [Member] | |||||
Stock issued for compensation, shares | 500,000 | ||||
Stock based compensation expense | $ 21,400 | $ 21,400 |
6. STOCK OPTIONS AND WARRANTS28
6. STOCK OPTIONS AND WARRANTS (Details - Option Assumptions) - Options [Member] | 6 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Risk-free interest rate | 1.31% | |
Expected volatility | 105.00% | |
Expected lives (years) | 5 years | |
Expected dividend yield | 0.00% |
6. STOCK OPTIONS AND WARRANTS29
6. STOCK OPTIONS AND WARRANTS (Details - Option activity) - Options [Member] - $ / shares | 6 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Options Outstanding | ||
Beginning balance | 68,050,000 | |
Issued | 13,100,000 | 0 |
Exercised | 0 | |
Ending balance | 81,150,000 | |
Exercisable | 65,750,000 | |
Vested and expected to vest | 68,650,000 | |
Weighted Average Exercise Price | ||
Beginning balance | $ .13 | |
Issued | .07 | |
Exercised | ||
Ending balance | .11 | |
Exercisable | .13 | |
Vested and expected to vest | .13 | |
Beginning balance | .09 | |
Issued | .04 | |
Ending balance | $ .09 |
6. STOCK OPTIONS AND WARRANTS30
6. STOCK OPTIONS AND WARRANTS (Details - Options by exercise price) | 6 Months Ended |
Oct. 31, 2016$ / sharesshares | |
$0.19 [Member] | |
Number of Options | shares | 25,000,000 |
Weighted Average Remaining Contractual LIfe (years) | 2 years 11 months 1 day |
Weighted Average Stock Price | $ / shares | $ 0.19 |
Numer of Options Exercisable | shares | 25,000,000 |
Weighted Average Exercise Price | $ / shares | $ 0.19 |
$0.11 [Member] | |
Number of Options | shares | 27,200,000 |
Weighted Average Remaining Contractual LIfe (years) | 3 years 2 months 1 day |
Weighted Average Stock Price | $ / shares | $ .11 |
Numer of Options Exercisable | shares | 27,200,000 |
Weighted Average Exercise Price | $ / shares | $ .11 |
$0.18 [Member] | |
Number of Options | shares | 250,000 |
Weighted Average Remaining Contractual LIfe (years) | 3 years 5 months 19 days |
Weighted Average Stock Price | $ / shares | $ 0.18 |
Numer of Options Exercisable | shares | 250,000 |
Weighted Average Exercise Price | $ / shares | $ 0.18 |
$0.063 [Member] | |
Number of Options | shares | 15,600,000 |
Weighted Average Remaining Contractual LIfe (years) | 4 years 2 months 1 day |
Weighted Average Stock Price | $ / shares | $ .063 |
Numer of Options Exercisable | shares | 13,000,000 |
Weighted Average Exercise Price | $ / shares | $ .063 |
$0.069 [Member] | |
Number of Options | shares | 13,100,000 |
Weighted Average Remaining Contractual LIfe (years) | 4 years 6 months |
Weighted Average Stock Price | $ / shares | $ .069 |
Numer of Options Exercisable | shares | 300,000 |
Weighted Average Exercise Price | $ / shares | $ .069 |
6. STOCK OPTIONS AND WARRANTS31
6. STOCK OPTIONS AND WARRANTS (Details - Warrant activity) - Warrants [Member] | 6 Months Ended |
Oct. 31, 2016$ / sharesshares | |
Warrants outstanding, beginning balance | 84,969,908 |
Warrants issued | |
Warrants exercised | |
Warrants outstanding, ending balance | 84,969,908 |
Warrants exercisable | 84,969,908 |
Weighted average exercise price warrants outstanding, beginning balance | $ / shares | $ .16 |
Weighted average exercise price warrants outstanding, ending balance | $ / shares | .16 |
Weighted average exercise price warrants exercisable | $ / shares | $ .16 |
6. STOCK OPTIONS AND WARRANTS32
6. STOCK OPTIONS AND WARRANTS (Details - Warrants by exercise price) | 6 Months Ended |
Oct. 31, 2016$ / sharesshares | |
$0.075, $0.11, $0.12, $0.18 and $0.25 [Member] | |
Number of Warrants exercisable | 84,969,908 |
Weighted average remaining contractual term | 2 years 18 days |
Weighted average exercise price exercisable | $ / shares | $ .16 |
Five Year Term $0.075 [Member] | |
Number of Warrants exercisable | 1,056,000 |
Weighted average remaining contractual term | 11 months 9 days |
Five Year Term $0.12 [Member] | |
Number of Warrants exercisable | 35,347,508 |
Weighted average remaining contractual term | 2 years 7 months 28 days |
Five Year Term $0.18 [Member] | |
Number of Warrants exercisable | 19,811,200 |
Weighted average remaining contractual term | 1 year 1 month 28 days |
Five Year Term $0.25 [Member] | |
Number of Warrants exercisable | 18,755,200 |
Weighted average remaining contractual term | 1 year 2 months 5 days |
Five Year Term $0.11 [Member] | |
Number of Warrants exercisable | 10,000,000 |
Weighted average remaining contractual term | 3 years 4 months 21 days |
6. STOCK OPTIONS AND WARRANTS33
6. STOCK OPTIONS AND WARRANTS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Stock based compensation - options | $ 340,236 | $ 287,928 | ||
Employee Options [Member] | ||||
Non-employee options granted in period | 0 | 0 | ||
Stock based compensation - options | $ 164,363 | $ 142,962 | $ 328,726 | $ 285,924 |
Non-Employee Options [Member] | ||||
Stock based compensation - options | 5,760 | 0 | $ 11,510 | $ 0 |
Options [Member] | ||||
Non-employee options granted in period | 13,100,000 | 0 | ||
Aggregate intrinsic value | 0 | $ 0 | ||
Aggregate intrinsic value per share | $ .04 | |||
Options [Member] | Guaranteed Options [Member] | ||||
Non-employee options granted in period | 600,000 | |||
Options [Member] | Non-Guaranteed Options [Member] | ||||
Non-employee options granted in period | 12,500,000 | |||
Unvested Stock Options [Member] | ||||
Unrecognized compensation expense | $ 109,576 | $ 238,266 | $ 109,576 | $ 238,266 |
Unrecognized compensation expense weighted-average period | 1 year |
8. RELATED PARTY TRANSACTIONS (
8. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
SG Austria [Member] | ||||
Purchases from related parties | $ 95,073 | $ 155,255 | $ 144,843 | $ 202,942 |
Vin-de-Bona [Member] | ||||
Consulting fees | $ 13,910 | $ 8,740 | 41,705 | 18,885 |
Austrianova [Member] | ||||
Payments made for licensing agreement | $ 2,000,000 | $ 1,400,000 |
9. COMMITMENTS AND CONTINGENC35
9. COMMITMENTS AND CONTINGENCIES (Details) | Oct. 31, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Minimum operating lease expense 2017 | $ 18,430 |
Minimum operating lease expense 2018 | 12,007 |
Minimum operating lease expense | $ 30,437 |
9. COMMITMENTS AND CONTINGENC36
9. COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Rent and lease expense | $ 9,577 | $ 17,114 | $ 23,429 | $ 29,612 |
ViruSure [Member] | ||||
Future milestone payments | $ 186,500 |
10. INCOME TAXES (Details Narra
10. INCOME TAXES (Details Narrative) - USD ($) | 6 Months Ended | |
Oct. 31, 2016 | Oct. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Increase in valuation allowance | $ 718,000 | $ 544,000 |
11. EARNINGS PER SHARE (Details
11. EARNINGS PER SHARE (Details - per share calculation) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Earnings Per Share [Abstract] | ||||
Net loss | $ (974,551) | $ (1,635,582) | $ (2,006,517) | $ (3,150,620) |
Basic weighted average number of shares outstanding | 848,910,100 | 745,357,022 | 818,540,900 | 741,637,252 |
Diluted weighted average number of shares outstanding | 848,910,100 | 745,357,022 | 818,540,900 | 741,637,252 |
Basic and diluted loss per share | $ 0 | $ 0 | $ 0 | $ 0 |
11. EARNINGS PER SHARE (Detai39
11. EARNINGS PER SHARE (Details - diluted shares) - shares | 3 Months Ended | 6 Months Ended | ||
Oct. 31, 2016 | Oct. 31, 2015 | Oct. 31, 2016 | Oct. 31, 2015 | |
Antidilutive shares | 166,119,908 | 125,419,908 | 166,119,908 | 125,419,908 |
Options [Member] | ||||
Antidilutive shares | 81,150,000 | 52,450,000 | 81,150,000 | 52,450,000 |
Warrants [Member] | ||||
Antidilutive shares | 84,969,908 | 72,969,908 | 84,969,908 | 72,969,908 |