NeuBase Therapeutics (NBSE) 10-Q 14 Feb 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Dec. 31, 2016	Feb. 13, 2017
Document And Entity Information
Entity Registrant Name	Ohr Pharmaceutical Inc
Entity Central Index Key	1,173,281
Document Type	10-Q
Trading Symbol	OHRP
Document Period End Date	Dec. 31, 2016
Amendment Flag	false
Current Fiscal Year End Date	--09-30
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		35,961,396
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2,017

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) - USD ($)	Dec. 31, 2016	Sep. 30, 2016
CURRENT ASSETS
Cash and cash equivalents	$ 13,489,082	$ 12,546,890
Prepaid expenses and other current assets	371,391	738,118
Total Current Assets	13,860,473	13,285,008
EQUIPMENT, net	187,728	198,631
OTHER ASSETS
Security deposit	12,243	12,243
Intangible assets, net	14,925,520	15,208,219
Goodwill	740,912	740,912
TOTAL ASSETS	29,726,876	29,445,013
CURRENT LIABILITIES
Accounts payable and accrued expenses	3,886,275	4,394,068
Notes payable		87,798
Total Current Liabilities	3,886,275	4,481,866
TOTAL LIABILITIES	3,886,275	4,481,866
STOCKHOLDERS' EQUITY
Preferred stock, Series B; 6,000,000 shares authorized, $0.0001 par value, 0 shares issued and outstanding, respectively
Common stock; 180,000,000 shares authorized, $0.0001 par value, 35,961,396 and 32,076,396 shares issued and outstanding, respectively	3,596	3,207
Additional paid-in capital	117,090,270	109,237,551
Accumulated deficit	(91,253,265)	(84,277,611)
Total Stockholders' Equity	25,840,601	24,963,147
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 29,726,876	$ 29,445,013

Consolidated Balance Sheets (U3

Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares	Dec. 31, 2016	Sep. 30, 2016
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	6,000,000	6,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized	180,000,000	180,000,000
Common stock, shares issued	35,961,396	32,076,396
Common stock, shares outstanding	35,961,396	32,076,396

Consolidated Statements of Oper

Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
OPERATING EXPENSES
General and administrative	$ 1,746,356	$ 1,218,128
Research and development	4,931,144	2,076,280
Depreciation and amortization	298,435	297,740
OPERATING LOSS	6,975,935	3,592,148
OTHER INCOME (EXPENSE)
Change in fair value of contingent consideration		(2,557,549)
Other income		3,419
Interest income (expense), net	281	816
Total Other Income (Expense)	281	(2,553,314)
LOSS FROM OPERATIONS BEFORE INCOME TAXES	(6,975,654)	(6,145,462)
NET LOSS	$ (6,975,654)	$ (6,145,462)
BASIC AND DILUTED LOSS PER SHARE (in dollars per share)	$ (.21)	$ (.20)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:
BASIC AND DILUTED (in shares)	32,836,505	30,472,493

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	3 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
OPERATING ACTIVITIES
Net loss	$ (6,975,654)	$ (6,145,462)
Adjustments to reconcile net loss to net cash used by operating activities:
Common stock issued for services	440,052	137,424
Stock option expense	566,573	316,819
Change in fair value of contingent consideration		2,557,549
Depreciation	15,736	15,042
Amortization of intangible assets	282,699	282,698
Changes in operating assets and liabilities
Prepaid expenses and deposits	247,926	(1,439,033)
Accounts payable and accrued expenses	(507,793)	948,522
Net Cash Used in Operating Activities	(5,930,461)	(3,326,441)
INVESTING ACTIVITIES
Purchase of property and equipment	(4,833)	(10,550)
Net Cash Used in Investing Activities	(4,833)	(10,550)
FINANCING ACTIVITIES
Proceeds for issuance of common stock for cash, net	6,846,483
Proceeds from warrants exercised for cash	118,801	13,540
Repayments of short-term notes payable	(87,798)	(48,063)
Net Cash Provided by/(Used in) Financing Activities	6,877,486	(34,523)
NET CHANGE IN CASH AND CASH EQUIVALENTS	942,192	(3,371,514)
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD	12,546,890	28,697,323
CASH AND CASH EQUIVALENTS AT END OF PERIOD	13,489,082	25,325,809
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest	$ 1,320	406
NON CASH FINANCING ACTIVITIES:
Settlement of contingent consideration		$ 2,061,136

BASIS OF PRESENTATION

BASIS OF PRESENTATION	3 Months Ended
	Dec. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PRESENTATION	NOTE 1 – BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements include the accounts of Ohr Pharmaceutical, Inc. and its subsidiaries (the “Company”). The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X related to interim period financial statements. Accordingly, these consolidated financial statements do not include certain information and footnotes required by GAAP for complete financial statements. However, in the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at December 31, 2016, and for all periods presented herein, have been made. It is suggested that these unaudited consolidated financial statements be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2016. The results of operations for the quarterly periods ended December 31, 2016 and 2015 are not necessarily indicative of the operating results for the full years.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Dec. 31, 2016
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates subject to change in the near term include impairment (if any) of long-lived assets. Fair Value of Financial Instruments In accordance with ASC 820, the carrying value of cash and cash equivalents, accounts receivable, accounts payable and notes payable approximates fair value due to the short-term maturity of these instruments. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own beliefs about the assumptions that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. There are no assets and liabilities that are measured and recognized at fair value as of December 31, 2016 and September 30, 2016, on a recurring basis. Recent Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of the Company’s financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

INTANGIBLE ASSETS

INTANGIBLE ASSETS	3 Months Ended
	Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
INTANGIBLE ASSETS	NOTE 3 – INTANGIBLE ASSETS Intangible assets at December 31, 2016 and September 30, 2016: December 31, 2016 September 30, 2016 License Rights $ 17,712,991 $ 17,712,991 Patent Costs 200,000 200,000 17,912,991 17,912,991 Accumulated Amortization (2,987,471 ) (2,704,772 ) Total Intangible Assets $ 14,925,520 $ 15,208,219 During the three months ended December 31, 2016, and 2015, the Company recognized $282,699, and $282,698, in amortization expense on the patents and license rights. The amortization expense has been included in research and development expense.

NOTES PAYABLE

NOTES PAYABLE	3 Months Ended
	Dec. 31, 2016
Debt Disclosure [Abstract]
NOTES PAYABLE	NOTE 4 – NOTES PAYABLE On February 28, 2016, the Company entered into a premium financing arrangement for its directors and officers insurance policy in the amount of $215,810. The financing arrangement bears interest at 7% per annum. As of December 31, 2016, the Company had repaid the loan in full and had paid total interest of $6,984.

EQUITY

EQUITY	3 Months Ended
	Dec. 31, 2016
Equity [Abstract]
EQUITY	NOTE 5 – EQUITY Public Offering On December 7, 2016, the Company entered into a securities purchase agreement with various purchasers pursuant to which the Company issued and sold to the purchasers in a registered offering an aggregate of 3,885,000 shares of its common stock, together with Series A common stock purchase warrants (“Series A Warrants”) exercisable for up to an aggregate of 1,942,501 shares of common stock and Series B common stock purchase warrants (“Series B Warrants”) exercisable for up to an aggregate of 3,885,000 shares of common stock. The offering closed on December 13, 2016 and the Company received net proceeds of approximately $6.8 million, after deducting placement agent fees and offering expenses payable by the Company. The Series A Warrant has an exercise price of $2.75 per share and the Series B Warrant has an exercise price of $3.00 per share. The Series A Warrants are immediately exercisable and will expire on the five year anniversary of the date of issuance. The Series B Warrants are immediately exercisable and will expire on the six month anniversary of the date of issuance. Common Stock Warrants Below is a table summarizing the warrants issued and outstanding as of December 31, 2016 (“Price” reflects the weighted average exercise price per share): Warrants Price Outstanding at September 30, 2016 614,923 $ 5.08 Granted — — Investor Warrants 5,827,501 2.92 Stock Based Compensation Warrants — — Exercised — — Investor Warrants — — Stock Based Compensation Warrants — — Forfeited or expired Investor Warrants (138,262 ) 6.30 Stock Based Compensation Warrants — — Outstanding at December 31, 2016 6,304,162 $ 3.05 Exercisable at December 31, 2016 6,304,162 $ 3.05 Stock Based Compensation The Company’s Consolidated 2016 Stock Plan (“the Plan”) provides for granting stock options and restricted stock awards to employees, directors and consultants of the Company. Warrants. Options. Below is a table summarizing the Company’s activity for the three months ended December 31, 2016 (“Price” reflects the weighted average exercise price per share): Options Price Outstanding at September 30, 2016 2,857,468 $ 6.66 Granted — — Exercised — — Forfeited or expired (31,800 ) 8.13 Outstanding at December 31, 2016 2,825,668 $ 6.64 Exercisable at December 31, 2016 1,911,912 $ 6.38 As of December 31, 2016, the outstanding options have no intrinsic value. Restricted Stock. Below is a table summarizing the Company’s activity for the three months ended December 31, 2016: Shares Weighted Nonvested at September 30, 2016 600,358 4.80 Granted — — Vested — — Forfeited — — Nonvested at December 31, 2016 600,358 4.80

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Dec. 31, 2016
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 6 – COMMITMENTS AND CONTINGENCIES Legal Proceedings The Company may become involved in certain legal proceedings and claims which arise in the normal course of business. If an unfavorable ruling were to occur, there exists the possibility of a material adverse impact on the Company’s results of operations, prospects, cash flows, financial position and brand. To the best knowledge of the Company’s management, at December 31, 2016, there are no legal proceedings which the Company believes will have a material adverse effect on its business, results of operations, cash flows or financial condition.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Dec. 31, 2016
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 7 – RELATED PARTY TRANSACTION Our Contract Research Organization (“CRO”) running our clinical trial has contracted with Jason S. Slakter, M.D., P.C., d/b/a Digital Angiography Reading Center (“DARC”), a well-known digital reading center, which is owned by Dr. Jason Slakter, Ohr’s CEO, pursuant to our related party transactions policy, with the review and approval of the Audit Committee, to provide digital reading and imaging services in connection with the clinical study. During the three months ended December 31, 2016, and 2015, the Company’s CRO was invoiced $152,405 and $0, from DARC.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Dec. 31, 2016
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 8 – SUBSEQUENT EVENTS On February 14, 2017, the Company announced that, for strategic reasons, it has paused enrollment in the clinical trial of its lead drug candidate squalamine lactate ophthalmic solution, 0.2%, for the treatment of neovascular age-related macular degeneration (wet AMD). The enrollment pause is not related to any safety issue. Currently, there are more than 200 subjects enrolled in the study. The study remains double-masked and no interim efficacy or futility analysis has been performed. Subjects currently enrolled in the study continue to undergo scheduled visits and assessments as well as receive assigned study treatments as per the current protocol.

SUMMARY OF SIGNIFICANT ACCOUN14

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Dec. 31, 2016
Accounting Policies [Abstract]
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates subject to change in the near term include impairment (if any) of long-lived assets.
Fair Value of Financial Instruments	Fair Value of Financial Instruments In accordance with ASC 820, the carrying value of cash and cash equivalents, accounts receivable, accounts payable and notes payable approximates fair value due to the short-term maturity of these instruments. ASC 820 clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. Level 2 - Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. Level 3 - Unobservable inputs, where there is little or no market activity for the asset or liability. These inputs reflect the reporting entity’s own beliefs about the assumptions that market participants would use in pricing the asset or liability, based on the best information available in the circumstances. There are no assets and liabilities that are measured and recognized at fair value as of December 31, 2016 and September 30, 2016, on a recurring basis.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Management has considered all recent accounting pronouncements issued since the last audit of the Company’s financial statements. The Company’s management believes that these recent pronouncements will not have a material effect on the Company’s financial statements.

INTANGIBLE ASSETS (Tables)

INTANGIBLE ASSETS (Tables)	3 Months Ended
	Dec. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of intangible assets	Intangible assets at December 31, 2016 and September 30, 2016: December 31, 2016 September 30, 2016 License Rights $ 17,712,991 $ 17,712,991 Patent Costs 200,000 200,000 17,912,991 17,912,991 Accumulated Amortization (2,987,471 ) (2,704,772 ) Total Intangible Assets $ 14,925,520 $ 15,208,219

EQUITY (Tables)

EQUITY (Tables)	3 Months Ended
	Dec. 31, 2016
Equity [Abstract]
Schedule of warrants issued and outstanding	Below is a table summarizing the warrants issued and outstanding as of December 31, 2016 (“Price” reflects the weighted average exercise price per share): Warrants Price Outstanding at September 30, 2016 614,923 $ 5.08 Granted — — Investor Warrants 5,827,501 2.92 Stock Based Compensation Warrants — — Exercised — — Investor Warrants — — Stock Based Compensation Warrants — — Forfeited or expired Investor Warrants (138,262 ) 6.30 Stock Based Compensation Warrants — — Outstanding at December 31, 2016 6,304,162 $ 3.05 Exercisable at December 31, 2016 6,304,162 $ 3.05
Schedule of activity of the Stock Plan	Below is a table summarizing the Company’s activity for the three months ended December 31, 2016 (“Price” reflects the weighted average exercise price per share): Options Price Outstanding at September 30, 2016 2,857,468 $ 6.66 Granted — — Exercised — — Forfeited or expired (31,800 ) 8.13 Outstanding at December 31, 2016 2,825,668 $ 6.64 Exercisable at December 31, 2016 1,911,912 $ 6.38
Schedule of changes in nonvested restricted stock shares	Below is a table summarizing the Company’s activity for the three months ended December 31, 2016: Shares Weighted Nonvested at September 30, 2016 600,358 4.80 Granted — — Vested — — Forfeited — — Nonvested at December 31, 2016 600,358 4.80

INTANGIBLE ASSETS (Details Narr

INTANGIBLE ASSETS (Details Narrative) - USD ($)	3 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of intangible assets	$ 282,699	$ 282,698

INTANGIBLE ASSETS (Details)

INTANGIBLE ASSETS (Details) - USD ($)	Dec. 31, 2016	Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
License Rights	$ 17,712,991	$ 17,712,991
Patent Costs	200,000	200,000
Total Intangible Assets,Gross	17,912,991	17,912,991
Accumulated Amortization	(2,987,471)	(2,704,772)
Total	$ 14,925,520	$ 15,208,219

NOTES PAYABLE (Details Narrativ

NOTES PAYABLE (Details Narrative) - Financing Arrangement Directors and Officers Insurance [Member] - USD ($)	3 Months Ended
	Dec. 31, 2016	Sep. 30, 2016
Debt issuance date	Feb. 28, 2016
Face amount of notes		$ 215,810
Notes payable, interest rate		7.00%
Interest paid	$ 6,984

EQUITY (Details Narrative)

EQUITY (Details Narrative) - USD ($)	Dec. 07, 2016	Dec. 31, 2016	Dec. 31, 2015
Stock-based compensation expense		$ 566,573	$ 316,819
Common stock issued in registered offering	3,885,000
Proceeds for issuance of common stock for cash, net		6,846,483
2016 Stock Plan [Member] | Stock Option [Member]
Stock-based compensation expense		566,573
Unrecognized compensation cost		$ 1,950,631
Unrecognized compensation cost weighted average recognise period		11 months 23 days
2016 Stock Plan [Member] | Restricted Stock [Member]
Stock-based compensation expense		$ 440,052
Unrecognized compensation cost		$ 729,581
Unrecognized compensation cost weighted average recognise period		1 year 11 days
Series A Warrants [Member]
Warrants (exercisable)	1,942,501
Exercise price of warrants	$ 2.75
Series B Warrants [Member]
Warrants (exercisable)	3,885,000
Exercise price of warrants	$ 3

EQUITY (Details)

EQUITY (Details) - Warrants [Member]	3 Months Ended
	Dec. 31, 2016$ / sharesshares
Warrants [Roll Forward]
Outstanding at beginning | shares	614,923
Granted | shares	5,827,201
Forfeited or expired | shares	(138,262)
Outstanding at end | shares	6,304,162
Exercisable at end | shares	6,304,162
Warrants, Weighted Average Grant Date Fair Value [Abstract]
Outstanding at beginning | $ / shares	$ 5.08
Granted | $ / shares	2.92
Forfeited or expired | $ / shares	6.30
Outstanding at end | $ / shares	3.05
Exercisable at end | $ / shares	$ 3.05

EQUITY (Details 1)

EQUITY (Details 1) - 2016 Stock Plan [Member] - Stock Option [Member]	3 Months Ended
	Dec. 31, 2016$ / sharesshares
Stock Plan, Options [Roll Forward]
Outstanding, beginning | shares	2,857,468
Forfeited or expired | shares	(31,800)
Outstanding, ending | shares	2,825,668
Exercisable, ending | shares	1,911,912
Stock Plan, Options Weighted Average Exercise Price [Rollforward]
Exercise price, beginning | $ / shares	$ 6.66
Forfeited or expired | $ / shares	8.13
Exercise price, ending | $ / shares	6.64
Exercisable, ended | $ / shares	$ 6.38

EQUITY (Details 2)

EQUITY (Details 2) - 2016 Stock Plan [Member] - Restricted Stock [Member]	3 Months Ended
	Dec. 31, 2016$ / sharesshares
Restricted Stock [Roll Forward]
Outstanding at beginning | shares	600,358
Granted | shares
Outstanding at end | shares	600,358
Restricted Stock, Weighted Average Grant Date Fair Value [Roll Forward]
Outstanding at beginning | $ / shares	$ 4.80
Granted | $ / shares
Outstanding at end | $ / shares	$ 4.80

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Detail Narratives) - USD ($)	3 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Dr. Jason Slakter [Member]
Amount invoiced for services - related party	$ 152,405	$ 0