Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Sep. 30, 2017 | Oct. 31, 2017 | |
Document and Entity Information: | ||
Entity Registrant Name | Nemaura Medical Inc. | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2017 | |
Amendment Flag | false | |
Entity Central Index Key | 1,602,078 | |
Current Fiscal Year End Date | --03-31 | |
Entity Common Stock, Shares Outstanding | 205,000,000 | |
Entity Filer Category | Accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) | Sep. 30, 2017 | Mar. 31, 2017 |
Current Assets: | ||
Cash | $ 597,539 | $ 911,359 |
Fixed rate cash account | 1,350,738 | 1,867,950 |
Prepaid expenses and other receivables | 71,844 | 51,086 |
Total Current Assets | 2,020,121 | 2,830,395 |
Other Assets | ||
Property and equipment, net | 7,683 | 9,161 |
Intangible assets, net of accumulated amortization | 232,138 | 203,800 |
Total Other Assets | 239,821 | 212,961 |
Long Term Assets: | ||
Fixed rate cash account | 4,735,241 | 4,358,550 |
Total Assets | 6,995,183 | 7,401,906 |
Current Liabilities: | ||
Accounts Payable | 142,604 | 77,530 |
Liabilities due to related party | 507,376 | 687,609 |
Other Liabilities and accrued expenses | 144,646 | 87,232 |
Total current liabilities | 794,626 | 852,371 |
Noncurrent Liabilities: | ||
Deferred revenue | 1,272,811 | 1,183,035 |
Total noncurrent liabilities | 1,272,811 | 1,183,035 |
Total liabilities | 2,067,437 | 2,035,406 |
Stockholders' equity: | ||
Common stock, $0.001 par value, 420,000,000 shares authorized and 205,000,000 shares issued and outstanding | 205,000 | 205,000 |
Additional paid in capital | 12,919,672 | 12,919,672 |
Accumulated deficit | (7,953,451) | (7,152,633) |
Accumulated other comprehensive loss | (243,475) | (605,539) |
Total stockholders' equity | 4,927,746 | 5,366,500 |
Total liabilities and stockholders' equity | $ 6,995,183 | $ 7,401,906 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2017 | Mar. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common Stock, Par Value | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 420,000,000 | 420,000,000 |
Common Stock, Shares Issued | 205,000,000 | 205,000,000 |
Common Stock, Shares Outstanding | 205,000,000 | 205,000,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Comprehensive Income/(Loss) (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | ||
Revenue: | |||||
Total revenues | $ 0 | $ 0 | $ 0 | $ 0 | |
Operating expenses | |||||
Research and development | 209,087 | 220,714 | 358,285 | 526,795 | |
General and administrative | 238,429 | 101,768 | 506,551 | 289,870 | |
Total operating expenses | 447,516 | 322,482 | 864,836 | 816,665 | |
Loss from operations | (447,516) | (322,482) | (864,836) | (816,665) | |
Interest income | 54,485 | 0 | 64,018 | 0 | |
Net loss | (393,031) | (322,482) | (800,818) | (816,665) | |
Other comprehensive income (loss): | |||||
Foreign Currency Transaction Adjustment | 159,309 | 140,312 | 362,064 | (389,703) | |
Comprehensive loss | $ (233,722) | $ (182,170) | $ (438,754) | $ (1,206,368) | |
Loss per share | |||||
Basic and diluted | [1] | ||||
Weighted Average Number of Shares Outstanding | 205,000,000 | 205,000,000 | 205,000,000 | 205,000,000 | |
[1] | Per share amounts are less than $0.01 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (800,818) | $ (816,665) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and Amortization | 15,031 | 11,037 |
Changes in assets and liabilities: | ||
Prepaid expenses and other receivables | (17,347) | 86,705 |
Accounts payable | 72,401 | (50,241) |
Liability due to related party | (221,735) | 0 |
Other liabilities and accrued expenses | 39,147 | 0 |
Advances from related party | 0 | 270,210 |
Interest receivable | (54,295) | 0 |
Net cash used in operating activities | (967,616) | (498,954) |
Cash Flows From Investing Activities: | ||
Purchase of intangible assets | (25,245) | (55,564) |
Purchase of property and equipment | 0 | (6,842) |
Fixed rate savings account | 639,460 | 0 |
Net cash provided by (used in) investing activities | 614,215 | (62,406) |
Net decrease in cash | (353,401) | (561,360) |
Effect of exchange rate changes on cash | 39,581 | (524,323) |
Cash at beginning of period | 911,359 | 9,403,965 |
Cash at end of period | $ 597,539 | $ 8,318,282 |
ORGANIZATION, PRINCIPAL ACTIVIT
ORGANIZATION, PRINCIPAL ACTIVITIES | 6 Months Ended |
Sep. 30, 2017 | |
Disclosure Text Block [Abstract] | |
ORGANIZATION, PRINCIPAL ACTIVITIES | NOTE 1 – ORGANIZATION AND PRINCIPAL ACTIVITIES Nemaura Medical Inc. ("Nemaura" or the "Company"), through its operating subsidiaries, performs medical device research of a continuous glucose monitoring system ("CGM"), named sugarBEAT. The sugarBEAT device is a non-invasive, wireless device for use by persons with Type I and Type II diabetes, and may also be used to screen pre-diabetic patients. The sugarBEAT device extracts analytes, such as glucose, to the surface of the skin in a non-invasive manner where it is measured using unique sensors and interpreted using a unique algorithm. Nemaura is a Nevada holding company organized in 2013. Nemaura owns one hundred percent (100%) of Region Green Limited, a British Virgin Islands corporation formed ("RGL") on December 12, 2013. Region Green Limited owns one hundred percent (100%) of the stock in Dermal Diagnostic (Holdings) Limited, an England and Wales corporation ("DDHL") formed on December 11, 2013, which in turn owns one hundred percent (100%) of Dermal Diagnostics Limited, an England and Wales corporation formed on January 20, 2009 ("DDL"), and one hundred percent (100%) of Trial Clinic Limited, an England and Wales corporation formed on January 12, 2011 ("TCL"). DDL is a diagnostic medical device company headquartered in Loughborough, Leicestershire, England, and is engaged in the discovery, development and commercialization of diagnostic medical devices. The Company's initial focus has been on the development of the sugarBEAT device, which consists of a disposable patch containing a sensor, and a non-disposable miniature electronic watch with a re-chargeable power source, which is designed to enable trending or tracking of blood glucose levels. Except for a US cash account (approximately $48,000 at September 30, 2017), all of the Company’s operations and assets are located in England. The following diagram illustrates our corporate and shareholder structure as of September 30, 2017: Nemaura Medical Inc. Nevada Corporation Region Green Limited British Virgin Islands Corporation Dermal Diagnostics (Holdings) Limited England and Wales Corporation Dermal Diagnostics Limited England and Wales Corporation Trial Clinic Limited England and Wales Corporation The Company has a limited operating history, recurring losses from operations and an accumulated deficit of $7,953,451 as of September 30, 2017. The Company expects to continue to incur losses from operations at least until clinical trials are completed later this calendar year and the product becomes available to be marketed. Management has evaluated its ability to continue as a going concern for the next twelve months from the issuance of these September 30, 2017 consolidated financial statements, and considered the expected expenses to be incurred along with its available cash, and has determined that there is not substantial doubt as to its ability to continue as a going concern for at least one year subsequent to the date of issuance of these financial statements. The Company has $597,539 of readily available cash on hand at September 30, 2017 and approximately $1.35 million will be available in December 2017, which is currently in a fixed rate deposit account. In addition, the Company has approximately $4.74 million of cash in a fixed rate deposit account which matures in December 2018. Management's strategic plans include the following: - continuing to advance commercialization of the Company's principal product, in the UK, European and other international markets; - pursuing additional capital raising opportunities; and - continuing to explore and execute prospective partnering or distribution opportunities. |
BASIS OF PRESENTATION
BASIS OF PRESENTATION | 6 Months Ended |
Sep. 30, 2017 | |
Disclosure Text Block [Abstract] | |
Basis of Presentation | NOTE 2 -- BASIS OF PRESENTATION (a) Basis of presentation: The accompanying condensed consolidated financial statements include the accounts of the Company and the Company’s subsidiaries, DDL, TCL, DDHL and RGL. The consolidated financial statements are prepared in accordance with the instructions to quarterly reports on Form 10-Q. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and changes in financial position at September 30, 2017 and for all periods presented have been made. Certain information and footnote data necessary for fair presentation of financial position and results of operations in conformity with accounting principles generally accepted in the United States of America have been condensed or omitted. It is therefore suggested that these financial statements be read in conjunction with the summary of significant accounting policies and notes to financial statements included in the Company’s Annual Report on Form 10-K for the Year Ended March 31, 2017. The results of operations for the period ended September 30, 2017 are not necessarily an indication of operating results for the full year. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Sep. 30, 2017 | |
Disclosure Text Block [Abstract] | |
Summary of Significant Accounting Policies | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Cash Cash includes cash equivalents, which the Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist primarily of cash deposits maintained in the United Kingdom. From time to time, the Company's cash account balances exceed amounts covered by the Financial Services Compensation Scheme. The Company has never suffered a loss due to such excess balances. (b) Fixed rate cash accounts: From time to time the Company invests funds in fixed rate cash savings accounts. These accounts, at the time of the initial investment, provide a higher interest rate than other bank accounts, and also require the Company to maintain the funds in the accounts for a period of time, $1,352,000 through December 2017 and $4,735,000 through December 2018. Early withdrawal may generally be made for liquidity needs. (c) Fair value of financial instruments The Company's financial instruments primarily consist of cash, fixed rate cash accounts, and accounts payable. As of the balance sheet dates, the estimated fair values of non-related party financial instruments were not materially different from their carrying values as presented, due to their short maturities. The fair value of amounts payable to related parties are not practicable to estimate due to the related party nature of the underlying transactions. (d) Property and equipment Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, generally four years for fixtures and fittings. (e) Intangible assets Intangible assets consist of licenses and patents associated with the sugarBEAT device and are amortized on a straight-line basis, generally over their legal lives of up to 20 years. (f) Revenue recognition Revenue is recognized when the four basic criteria of revenue recognition are met: (1) a contractual agreement exists; (2) transfer of rights has been completed; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. The Company may enter into product development and other agreements and with collaborative partners. The terms of the agreements may include nonrefundable signing and licensing fees, milestone payments and royalties on any product sales derived from collaborations. The Company recognizes up front license payments as revenue upon delivery of the license only if the license has stand alone value to the customer. However, where further performance criteria must be met, revenue is deferred and recognized on a straight line basis over the period the Company is expected to complete its performance obligations. Royalty revenue will be recognized upon the sale of the related products provided the Company has no remaining performance obligations under the agreement. (g) Research and development expenses The Company charges research and development expenses to operations as incurred. Research and development expenses primarily consist of salaries and related expenses for personnel and outside contractor and consulting services. Other research and development expenses include the costs of materials and supplies used in research and development, prototype manufacturing, clinical studies, related information technology and an allocation of facilities costs. (h) Income taxes Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss carry forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion, or all, of the deferred income tax assets will not be realized. (i) Earnings per share Basic earnings per share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding during the period. There were no potentially dilutive securities as of September 30, 2017 and 2016. For the three month and six month periods ended September 30, 2017 and 2016, warrants to purchase 10 million shares of common stock were anti-dilutive and were excluded from the calculation of diluted loss per share. (j) Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results may differ from those estimates. (k) Foreign currency translation The functional currency of the Company is the Great Britain Pound Sterling ("GBP"). The reporting currency is the United States dollar (US$). Stockholders' equity is translated into United States dollars from GBP at historical exchange rates. Assets and liabilities are translated at the exchange rates as of balance sheet date. Income and expenditures are translated at the average exchange rates prevailing during the reporting period. The translation rates are as follows: Six months ended September 30, 2017 (unaudited) Six months ended September 30, 2016 (unaudited) Three months ended September 30, 2017 (unaudited) Three months ended September 30, 2016 (unaudited) Twelve months ended March 31, 2017 Period end GBP : US$ exchange rate 1.340 1.325 1.340 1.325 1.245 Average period/yearly GBP : US$ exchange rate 1.279 1.382 1.283 1.370 1.315 Adjustments resulting from translating the financial statements into the United States dollar are recorded as a separate component of accumulated other comprehensive loss in stockholders' equity. (l) Recent accounting pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of the change to its consolidated financial statements and assures that there are proper controls in place to ascertain that the Company's consolidated financial statements properly reflect the change. In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Updates ("ASU") No. 2014-09, Revenue from Contracts with Customers. ASU 2014-09 has been modified multiple times since its initial release. This ASU outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. ASU 2014-09, as amended, becomes effective for annual reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the impact that this standard will have on its financial statements and related disclosures. The impact is expected to be insignificant until the Company begins to generate revenue, except as to the possible impact related to the deferred revenue recorded in connection with the licensing agreement described in Note 4 which the Company is currently evaluating. The standard permits the use of either the retrospective or cumulative effect transition method. The Company has not yet selected a transition method. In March 2016, the FASB issued ASU No. 2016-02, Leases. The main difference between the provisions of ASU No. 2016-02 and previous U.S. GAAP is the recognition of right-of-use assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. ASU No. 2016- 02 retains a distinction between finance leases and operating leases, and the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize right-of-use assets and lease liabilities. The accounting applied by a lessor is largely unchanged from that applied under previous U.S. GAAP. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This ASU is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of the standard on its ongoing reporting. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments. ASU No. 2016-15 is intended to reduce diversity in how certain cash receipts and cash payments are presented in the statement of cash flows. The new guidance clarifies the classification of cash activity related to debt prepayment or debt extinguishment costs, settlement of zero-coupon debt instruments, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate and bank-owned life insurance policies, distributions received from equity-method investments, and beneficial interests in securitization transactions. The guidance also describes a predominance principle pursuant to which cash flows with aspects of more than one class that cannot be separated should be classified based on the activity that is likely to be the predominant source or use of cash flow. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect it to have a material effect on the Company's consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows - Restricted Cash. ASU 2016-18 requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. When cash, cash equivalents, restricted cash and restricted cash equivalents are presented in more than one line item on the balance sheet, a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheet is required. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures. (m) Risks and uncertainties The Company is in the development stage of one primary product that it expects to introduce to the UK market after completion of clinical trials and CE mark approval (European Union approval of the product). The Company has entered into sales and marketing agreements for the product, but has not yet entered into manufacturing agreements. These matters raise uncertainties as regulatory acceptance of the Company’s primary product development efforts and if acceptance is attained, the cost structure to produce the product. (n) Subsequent events In October 2017, the Company’s board of directors designated 200,000 shares of Series A Convertible Preferred Stock, as authorized by its articles of incorporation. The par value of the preferred stock is $0.001 per share. Each share of preferred stock is convertible into 1,000 shares of the Company’s common stock, automatically upon the occurrence of certain triggering events, as set forth in the certificate of designation, or voluntarily by the holder after February 1, 2019, if these triggering events have not occurred Each holder of issued and outstanding preferred stock is entitled to a number of votes equal to the number of shares of common stock into which the preferred stock is convertible. Holders of preferred are entitled to vote on any and all matters presented to stockholders of the Company, except as provided by law. The preferred stock has preference to the common stock as to dividends or distributions of assets upon liquidation or winding up of the Company. Currently, no shares of preferred stock have been issued. |
LICENSING AGREEMENT
LICENSING AGREEMENT | 6 Months Ended |
Sep. 30, 2017 | |
Disclosure Text Block [Abstract] | |
Licensing Agreement | NOTE 4 – LICENSING AGREEMENT In March 2014, the Company entered into an Exclusive Marketing Rights Agreement with an unrelated third party, that granted to the third party the exclusive right to market and promote the sugarBEAT device and related patches under its own brand in the United Kingdom and the Republic of Ireland, the Channel Islands and the Isle of Man. The Company received a non-refundable, up front cash payment of GBP 1,000,000 (approximately $1.340 million and $1.245 million as of September 30, 2017 and March 31, 2017 respectively) which is wholly non-refundable, upon signing the agreement. As the Company has continuing performance obligations under the agreement, the up front fees received from this agreement have been deferred and will be recorded as income over the term of the commercial licensing agreement beginning from the date of clinical evaluation approval. As the Company expects commercialization of the sugarBEAT device to occur in the year ending March 31, 2019, approximately $67,000 of the deferred revenue has been classified as a current liability. In April 2014, a Letter of Intent was signed with the third party which specified a 10 year term and in November 2015, a Licence, Supply and Distribution agreement with an initial 5 year term was executed. The Company grants the exclusive right to market and promote its product in the United Kingdom, and purchase the product at specified prices. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Sep. 30, 2017 | |
Disclosure Text Block [Abstract] | |
Related Party Transactions | NOTE 5 – RELATED PARTY TRANSACTIONS Nemaura Pharma Limited (Pharma) and NDM Technologies Limited (NDM) are entities controlled by the Company’s majority shareholder, Dewan F.H. Chowdhury. In accordance with the United States Securities and Exchange Commission (SEC) Staff Accounting Bulletin 55, these financial statements are intended to reflect all costs associated with the operations of DDL and TCL. Pharma has invoiced DDL and TCL for research and development services. In addition, certain operating expenses of DDL and TCL were incurred and paid by Pharma and NDM which have been invoiced to the Company. Certain costs incurred by Pharma and NDM are directly attributable to DDL and TCL and such costs were billed to the Company. Prior to the year ended March 31, 2016, other costs were shared between the organizations. In situations where the costs were shared, expense has been allocated between Pharma and NDM and DDL and TCL using a fixed percentage allocation and were billed to the Company. Management believes the allocation methodologies used are reasonable. DDL and TCL advanced Pharma certain amounts to cover a portion of the costs. Following is a summary of activity between the Company and Pharma and NDM for the six months ended September 30, 2017 and 2016. These amounts are unsecured, interest free, and payable on demand. Six Months Ended September 30, 2017 (unaudited) ($) Six Months Ended September 30, 2016 (unaudited) ($) Balance due from (to) Pharma and NDM at beginning of period (687,609 ) (494,145 ) Amounts invoiced by Pharma to DDL and TCL (1) (239,758 ) (286,096 ) Amounts invoiced by DDL to Pharma - 15,886 Amounts repaid by DDL to Pharma 440,266 - Amounts paid by DDL on behalf of Pharma 19,889 - Foreign exchange differences (40,164 ) 46,420 Balance due to Pharma and NDM at end of the period (507,376 ) (717,935 ) (1) These amounts are included primarily in research and development expenses charged to the Company by Pharma and NDM. |
SUMMARY OF SIGNIFICANT ACCOUN11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Sep. 30, 2017 | |
Policy Text Block [Abstract] | |
Cash | (a) Cash Cash includes cash equivalents, which the Company considers all highly liquid investments purchased with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist primarily of cash deposits maintained in the United Kingdom. From time to time, the Company's cash account balances exceed amounts covered by the Financial Services Compensation Scheme. The Company has never suffered a loss due to such excess balances. |
Fixed rate cash accounts | (b) Fixed rate cash accounts: From time to time the Company invests funds in fixed rate cash savings accounts. These accounts, at the time of the initial investment, provide a higher interest rate than other bank accounts, and also require the Company to maintain the funds in the accounts for a period of time, $1,352,000 through December 2017 and $4,735,000 through December 2018. Early withdrawal may generally be made for liquidity needs. |
Fair Value of Financial Instruments | (c) Fair value of financial instruments The Company's financial instruments primarily consist of cash, fixed rate cash accounts, and accounts payable. As of the balance sheet dates, the estimated fair values of non-related party financial instruments were not materially different from their carrying values as presented, due to their short maturities. The fair value of amounts payable to related parties are not practicable to estimate due to the related party nature of the underlying transactions. |
Property and equipment | (d) Property and equipment Property and equipment is stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, generally four years for fixtures and fittings. |
Intangible Assets | (e) Intangible assets Intangible assets consist of licenses and patents associated with the sugarBEAT device and are amortized on a straight-line basis, generally over their legal lives of up to 20 years. |
Revenue Recognition | (f) Revenue recognition Revenue is recognized when the four basic criteria of revenue recognition are met: (1) a contractual agreement exists; (2) transfer of rights has been completed; (3) the fee is fixed or determinable; and (4) collectability is reasonably assured. The Company may enter into product development and other agreements and with collaborative partners. The terms of the agreements may include nonrefundable signing and licensing fees, milestone payments and royalties on any product sales derived from collaborations. The Company recognizes up front license payments as revenue upon delivery of the license only if the license has stand alone value to the customer. However, where further performance criteria must be met, revenue is deferred and recognized on a straight line basis over the period the Company is expected to complete its performance obligations. Royalty revenue will be recognized upon the sale of the related products provided the Company has no remaining performance obligations under the agreement. |
Research and development expenses | (g) Research and development expenses The Company charges research and development expenses to operations as incurred. Research and development expenses primarily consist of salaries and related expenses for personnel and outside contractor and consulting services. Other research and development expenses include the costs of materials and supplies used in research and development, prototype manufacturing, clinical studies, related information technology and an allocation of facilities costs. |
Income Taxes | (h) Income taxes Income taxes are accounted for under the asset and liability method. Deferred income tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and operating loss carry forwards. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is provided to reduce the carrying amount of deferred income tax assets if it is considered more likely than not that some portion, or all, of the deferred income tax assets will not be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs. The Company has elected to classify interest and penalties related to unrecognized tax benefits as part of income tax expense in the consolidated statements of comprehensive loss. The Company does not have any accrued interest or penalties associated with any unrecognized tax benefits, nor was any interest expense related to unrecognized tax benefits recognized for the three months ended September 30, 2017 and 2016. The Company’s deferred tax asset consists primarily of net operating loss carried forwards, and are fully allowed for as realization of these assets is not considered to be more likely than not. |
Earnings Per Share | (i) Earnings per share Basic earnings per share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding during the period. There were no potentially dilutive securities as of September 30, 2017 and 2016. For the three month and six month periods ended September 30, 2017 and 2016, warrants to purchase 10 million shares of common stock were anti-dilutive and were excluded from the calculation of diluted loss per share. |
Use of Estimates | (j) Use of estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year. Actual results may differ from those estimates. |
Foreign Currency Translation | (k) Foreign currency translation The functional currency of the Company is the Great Britain Pound Sterling ("GBP"). The reporting currency is the United States dollar (US$). Stockholders' equity is translated into United States dollars from GBP at historical exchange rates. Assets and liabilities are translated at the exchange rates as of balance sheet date. Income and expenditures are translated at the average exchange rates prevailing during the reporting period. The translation rates are as follows: Six months ended September 30, 2017 (unaudited) Six months ended September 30, 2016 (unaudited) Three months ended September 30, 2017 (unaudited) Three months ended September 30, 2016 (unaudited) Twelve months ended March 31, 2017 Period end GBP : US$ exchange rate 1.340 1.325 1.340 1.325 1.245 Average period/yearly GBP : US$ exchange rate 1.279 1.382 1.283 1.370 1.315 Adjustments resulting from translating the financial statements into the United States dollar are recorded as a separate component of accumulated other comprehensive loss in stockholders' equity. |
Recent Accounting Pronouncements | (l) Recent accounting pronouncements The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of the change to its consolidated financial statements and assures that there are proper controls in place to ascertain that the Company's consolidated financial statements properly reflect the change. In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Updates ("ASU") No. 2014-09, Revenue from Contracts with Customers. ASU 2014-09 has been modified multiple times since its initial release. This ASU outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. ASU 2014-09, as amended, becomes effective for annual reporting periods beginning after December 15, 2017. Early adoption is permitted. The Company is currently evaluating the impact that this standard will have on its financial statements and related disclosures. The impact is expected to be insignificant until the Company begins to generate revenue, except as to the possible impact related to the deferred revenue recorded in connection with the licensing agreement described in Note 4 which the Company is currently evaluating. The standard permits the use of either the retrospective or cumulative effect transition method. The Company has not yet selected a transition method. In March 2016, the FASB issued ASU No. 2016-02, Leases. The main difference between the provisions of ASU No. 2016-02 and previous U.S. GAAP is the recognition of right-of-use assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. GAAP. ASU No. 2016- 02 retains a distinction between finance leases and operating leases, and the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee have not significantly changed from previous U.S. GAAP. For leases with a term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize right-of-use assets and lease liabilities. The accounting applied by a lessor is largely unchanged from that applied under previous U.S. GAAP. In transition, lessees and lessors are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. This ASU is effective for public business entities in fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company has not yet determined the effect of the standard on its ongoing reporting. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows - Classification of Certain Cash Receipts and Cash Payments. ASU No. 2016-15 is intended to reduce diversity in how certain cash receipts and cash payments are presented in the statement of cash flows. The new guidance clarifies the classification of cash activity related to debt prepayment or debt extinguishment costs, settlement of zero-coupon debt instruments, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate and bank-owned life insurance policies, distributions received from equity-method investments, and beneficial interests in securitization transactions. The guidance also describes a predominance principle pursuant to which cash flows with aspects of more than one class that cannot be separated should be classified based on the activity that is likely to be the predominant source or use of cash flow. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures, but does not expect it to have a material effect on the Company's consolidated financial statements and related disclosures. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows - Restricted Cash. ASU 2016-18 requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. When cash, cash equivalents, restricted cash and restricted cash equivalents are presented in more than one line item on the balance sheet, a reconciliation of the totals in the statement of cash flows to the related captions in the balance sheet is required. This ASU is effective for public entities for annual and interim periods beginning after December 15, 2017. Early adoption is permitted as of the beginning of any interim or annual reporting period. The Company is currently evaluating the impact this standard will have on its financial statements and related disclosures. |
Risks and Uncertainties | (m) Risks and uncertainties The Company is in the development stage of one primary product that it expects to introduce to the UK market after completion of clinical trials and CE mark approval (European Union approval of the product). The Company has entered into sales and marketing agreements for the product, but has not yet entered into manufacturing agreements. These matters raise uncertainties as regulatory acceptance of the Company’s primary product development efforts and if acceptance is attained, the cost structure to produce the product. |
Subsequent events | (n) Subsequent events In October 2017, the Company’s board of directors designated 200,000 shares of Series A Convertible Preferred Stock, as authorized by its articles of incorporation. The par value of the preferred stock is $0.001 per share. Each share of preferred stock is convertible into 1,000 shares of the Company’s common stock, automatically upon the occurrence of certain triggering events, as set forth in the certificate of designation, or voluntarily by the holder after February 1, 2019, if these triggering events have not occurred Each holder of issued and outstanding preferred stock is entitled to a number of votes equal to the number of shares of common stock into which the preferred stock is convertible. Holders of preferred are entitled to vote on any and all matters presented to stockholders of the Company, except as provided by law. The preferred stock has preference to the common stock as to dividends or distributions of assets upon liquidation or winding up of the Company. Currently, no shares of preferred stock have been issued. |
SUMMARY OF SIGNIFICANT ACCOUN12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Summary Of Significant Accounting Policies Tables | |
Translation Rates | The translation rates are as follows: Six months ended September 30, 2017 (unaudited) Six months ended September 30, 2016 (unaudited) Three months ended September 30, 2017 (unaudited) Three months ended September 30, 2016 (unaudited) Twelve months ended March 31, 2017 Period end GBP : US$ exchange rate 1.340 1.325 1.340 1.325 1.245 Average period/yearly GBP : US$ exchange rate 1.279 1.382 1.283 1.370 1.315 |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions Tables | |
Schedule of Related Party Transactions | These amounts are unsecured, interest free, and payable on demand. Six Months Ended September 30, 2017 (unaudited) ($) Six Months Ended September 30, 2016 (unaudited) ($) Balance due from (to) Pharma and NDM at beginning of period (687,609 ) (494,145 ) Amounts invoiced by Pharma to DDL and TCL (1) (239,758 ) (286,096 ) Amounts invoiced by DDL to Pharma - 15,886 Amounts repaid by DDL to Pharma 440,266 - Amounts paid by DDL on behalf of Pharma 19,889 - Foreign exchange differences (40,164 ) 46,420 Balance due to Pharma and NDM at end of the period (507,376 ) (717,935 ) |
ORGANIZATION, PRINCIPAL ACTIV14
ORGANIZATION, PRINCIPAL ACTIVITIES (Details Narrative) - USD ($) | Dec. 31, 2017 | Sep. 30, 2017 | Mar. 31, 2017 | Sep. 30, 2016 | Mar. 31, 2016 |
Organization Principal Activities Details Narrative | |||||
Accumulated deficit | $ (7,953,451) | $ (7,152,633) | |||
Cash available on hand | $ 1,350,000 | 597,539 | 911,359 | $ 8,318,282 | $ 9,403,965 |
Fixed rate cash account | $ 4,740,000 | $ 4,735,241 | $ 4,358,550 |
SUMMARY OF SIGNIFICANT ACCOUN15
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Sep. 30, 2017 | Sep. 30, 2016 | Mar. 31, 2017 | |
Period End GBP/USD Exchange Rate [Membe] | |||||
Exchange rate | 1.340 | 1.325 | 1.340 | 1.325 | 1.245 |
Period Average GBP/USD Exchange Rate [Membe] | |||||
Exchange rate | 1.283 | 1.370 | 1.279 | 1.382 | 1.315 |
SUMMARY OF SIGNIFICANT ACCOUN16
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | |
Summary Of Significant Accounting Policies Details Narrative | ||||
Fixed rate cash accounts | $ 4,735,000 | $ 1,352,000 | ||
Anti-dilutive common stock | 10,000,000 | 10,000,000 |
LICENSING AGREEMENT (Details Na
LICENSING AGREEMENT (Details Narrative) - USD ($) | Mar. 31, 2019 | Sep. 30, 2017 | Mar. 31, 2017 |
Licensing Agreement Details Narrative | |||
Non-refundable, upfront cash payment | $ 1,340,000 | $ 1,245,000 | |
Deferred revenue | $ 67,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 6 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | ||
Note 7 - Related Party Transactions Details | |||
Balance due (to) Pharma and NDM at beginning of period | $ (687,609) | $ (494,145) | |
Amount invoiced by Pharma to DDL and TCL | [1] | (239,758) | (286,096) |
Amounts invoiced by DDL to Pharma | 15,886 | ||
Foreign exchange differences | 440,266 | ||
Amounts repaid by DDL to Pharma | 19,889 | ||
Amounts paid by DDL on behalf of Pharma | (40,164) | 46,420 | |
Net balance due from Pharma and NDM at end of the period | $ (507,376) | $ (717,935) | |
[1] | These amounts are included primarily in research and development expenses charged to the Company by Pharma and NDM. |