Artelo Biosciences (ARTL) 10-Q 13 Jul 20 2020 Q3 Quarterly report Financial data

Document And Entity Information

Document And Entity Information - shares	9 Months Ended
	May 31, 2020	Jul. 10, 2020
Document And Entity Information [Abstract]
Entity Registrant Name	ARTELO BIOSCIENCES, INC.
Entity Central Index Key	0001621221
Trading Symbol	ARTL
Security Exchange Name	NASDAQ
Title of 12(b) Security	Common Stock, $0.001 par value
Current Fiscal Year End Date	--08-31
Entity Filer Category	Non-accelerated Filer
Entity Current Reporting Status	Yes
Entity Common Stock, Shares Outstanding		4,496,366
Entity Interactive Data Current	Yes
Document Type	10-Q
Document Period End Date	May 31, 2020
Amendment Flag	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Entity Small Business	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Shell Company	false

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($)	May 31, 2020	Aug. 31, 2019
Current Assets
Cash and cash equivalents	$ 1,279,256	$ 4,423,965
Prepaid expenses and other current assets	74,655	18,623
Deferred offering costs	98,715
Total Current Assets	1,452,626	4,442,588
Equipment, net of accumulated depreciation of $1,144 and $792, respectively	1,484	721
Intangible asset	2,039,417	2,039,417
TOTAL ASSETS	3,493,527	6,482,726
Current Liabilities
Accounts payable and accrued liabilities	255,632	348,863
Due to related party	12,825	3,732
Derivative liability		29,501
Stock payable		639,417
Total Current Liabilities	268,457	1,021,513
STOCKHOLDERS' EQUITY
Preferred Stock, par value $0.001, 6,250,000 shares authorized, 0 and 0 shares issued and outstanding, respectively
Common Stock, par value $0.001, 18,750,000 shares authorized, 3,733,604 and 3,353,616 shares issued and outstanding, respectively	3,734	3,354
Additional paid-in capital	11,609,266	10,278,421
Accumulated deficit	(8,438,434)	(4,810,756)
Accumulated other comprehensive income (loss)	50,504	(9,806)
Total Stockholders' Equity	3,225,070	5,461,213
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 3,493,527	$ 6,482,726

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parentheticals) - USD ($)	May 31, 2020	Aug. 31, 2019
Statement of Financial Position [Abstract]
Accumulated depreciation on equipment (in dollars)	$ 1,144	$ 792
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	6,250,000	6,250,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	18,750,000	18,750,000
Common stock, shares issued	3,733,604	3,353,616
Common stock, shares outstanding	3,733,604	3,353,616

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	May 31, 2020	May 31, 2019	May 31, 2020	May 31, 2019
OPERATING EXPENSES
General and administrative	$ 382,543	$ 402,803	$ 1,225,952	$ 666,226
Professional fees	303,524	354,038	785,133	731,277
Research and development	265,204	184,204	1,646,920	858,224
Depreciation	124	243	372	383
Total Operating Expenses	951,395	941,288	3,658,377	2,256,110
Loss from Operations	(951,395)	(941,288)	(3,658,377)	(2,256,110)
OTHER INCOME (EXPENSE)
Other income	204	32,439	1,198	32,439
Change in fair value of derivative liabilities	0	563,966	29,501	897,096
Total other income	204	596,405	30,699	929,535
Provision for income taxes		0	0	0
NET LOSS	(951,191)	(344,883)	(3,627,678)	(1,326,575)
OTHER COMPREHENSIVE INCOME (LOSS)
Foreign currency translation adjustments	34,547	771	60,310	2,053
Total Other Comprehensive Income (Loss)	34,547	771	60,310	2,053
TOTAL COMPREHENSIVE LOSS	$ (916,644)	$ (344,112)	$ (3,567,368)	$ (1,324,522)
Basic and Diluted Loss per Common Share (in dollars per share)	$ (0.27)	$ (0.17)	$ (1.06)	$ (0.70)
Basic and Diluted Weighted Average Common Shares Outstanding (in shares)	3,466,385	2,058,929	3,418,148	1,898,263

Consolidated Statements of Stoc

Consolidated Statements of Stockholders' Equity (Deficit) (Unaudited) - USD ($)	Common Stock	Additional paid-in capital	Accumulated Deficit	Accumulated Other Comprehensive Income (Loss)	Total
Balances at Aug. 31, 2018	$ 1,750	$ 2,514,136	$ (2,638,580)	$ (12,280)	$ (134,974)
Balances (in shares) at Aug. 31, 2018	1,750,268
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for cash	$ 29	170,745			170,774
Common shares issued for cash (in shares)	29,300
Common shares issued for services - officers		13,000			13,000
Stock option granted for services		28,051			28,051
Net loss for the period			(556,903)		(556,903)
Foreign currency translation adjustments				4,888	4,888
Balances at Nov. 30, 2018	$ 1,779	2,725,932	(3,195,483)	(7,392)	(475,164)
Balances (in shares) at Nov. 30, 2018	1,779,568
Balances at Aug. 31, 2018	$ 1,750	2,514,136	(2,638,580)	(12,280)	(134,974)
Balances (in shares) at Aug. 31, 2018	1,750,268
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss for the period					(1,326,575)
Foreign currency translation adjustments					2,053
Balances at May. 31, 2019	$ 2,101	4,107,660	(3,965,155)	(10,227)	134,379
Balances (in shares) at May. 31, 2019	2,101,140
Balances at Nov. 30, 2018	$ 1,779	2,725,932	(3,195,483)	(7,392)	(475,164)
Balances (in shares) at Nov. 30, 2018	1,779,568
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for cash	$ 181	1,086,950			1,087,131
Common shares issued for cash (in shares)	180,365
Common shares issued for services - officers		13,000			13,000
Reclass Of Warrant Derivative Liability From Equity		(918,050)			(918,050)
Stock option granted for services		29,304			29,304
Net loss for the period			(424,789)		(424,789)
Foreign currency translation adjustments				(3,606)	(3,606)
Balances at Feb. 28, 2019	$ 1,960	2,937,136	(3,620,272)	(10,998)	(692,174)
Balances (in shares) at Feb. 28, 2019	1,959,933
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for cash	$ 55	417,677			417,732
Common shares issued for cash (in shares)	54,940
Common shares issued for services - officers		13,000			13,000
Common shares issued for services - related party	$ 25	239,975			240,000
Common shares issued for services - related party (in shares)	25,000
Reclass Of Warrant Derivative Liability From Equity		(79,224)			(79,224)
Common shares issued for acquisition of license	$ 61	539,356			539,417
Common shares issued for acquisition of license (in shares)	61,297
Stock option granted for services		39,740			39,740
Net loss for the period			(344,883)		(344,883)
Foreign currency translation adjustments				771	771
Balances at May. 31, 2019	$ 2,101	4,107,660	(3,965,155)	(10,227)	134,379
Balances (in shares) at May. 31, 2019	2,101,140
Balances at Aug. 31, 2019	$ 3,354	10,278,421	(4,810,756)	(9,806)	$ 5,461,213
Balances (in shares) at Aug. 31, 2019	3,353,616				3,353,616
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issuance costs		(15,151)			$ (15,151)
Common shares issued for services - officers		13,000			13,000
Common shares issued for acquisition of license	$ 61	539,356			539,417
Common shares issued for acquisition of license (in shares)	61,297
Common shares issued for settlement of debt	$ 11	99,989			100,000
Common shares issued for settlement of debt (in shares)	11,363
Refund for fractional stock		(117)			(117)
Stock option expense		155,019			155,019
Net loss for the period			(1,306,361)		(1,306,361)
Foreign currency translation adjustments				16,344	16,344
Balances at Nov. 30, 2019	$ 3,426	11,070,517	(6,117,117)	6,538	4,963,364
Balances (in shares) at Nov. 30, 2019	3,426,276
Balances at Aug. 31, 2019	$ 3,354	10,278,421	(4,810,756)	(9,806)	$ 5,461,213
Balances (in shares) at Aug. 31, 2019	3,353,616				3,353,616
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common stock issuance costs					$ (15,151)
Common shares issued for cash	$ 380,678
Common shares issued for cash (in shares)	386,238
Common shares issued for acquisition of license (in shares)	61,297
Common shares issued for settlement of debt					100,000
Common shares issued for settlement of debt (in shares)	11,363
Net loss for the period					(3,627,678)
Foreign currency translation adjustments					60,310
Balances at May. 31, 2020	$ 3,734	11,609,266	(8,438,434)	50,504	$ 3,225,070
Balances (in shares) at May. 31, 2020	3,733,604				3,733,604
Balances at Nov. 30, 2019	$ 3,426	11,070,517	(6,117,117)	6,538	$ 4,963,364
Balances (in shares) at Nov. 30, 2019	3,426,276
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Additional common shares issued	$ 7	(7)
Additional common shares issued (shares)	7,373
Common shares issued for services - officers		10,500			10,500
Cancellation of common shares	$ (6)	(2,494)			(2,500)
Cancellation of common shares (shares)	(6,250)
Stock option expense		97,397			97,397
Net loss for the period			(1,370,126)		(1,370,126)
Foreign currency translation adjustments				9,419	9,419
Balances at Feb. 29, 2020	$ 3,427	11,175,913	(7,487,243)	15,957	3,708,054
Balances (in shares) at Feb. 29, 2020	3,427,399
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Common shares issued for cash	$ 307	380,371			380,678
Common shares issued for cash (in shares)	306,205
Additional common shares issued (shares)	7,373
Common shares issued for services - officers		10,500			10,500
Cancellation of common shares					(2,500)
Stock option expense		42,482			42,482
Net loss for the period			(951,191)		(951,191)
Foreign currency translation adjustments				34,547	34,547
Balances at May. 31, 2020	$ 3,734	$ 11,609,266	$ (8,438,434)	$ 50,504	$ 3,225,070
Balances (in shares) at May. 31, 2020	3,733,604				3,733,604

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	May 31, 2020	May 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$ (3,627,678)	$ (1,326,575)
Adjustments to reconcile net loss to net cash used in operating activities:
Stock based compensation	326,398	376,095
Depreciation	372	383
Change in fair value of derivative liabilities	(29,501)	(897,096)
Changes in operating assets and liabilities:
Prepaid expenses and other current assets	(56,027)	24,142
Accounts payable and accrued liabilities	(88,231)	91,471
Net cash used in operating activities	(3,474,667)	(1,731,580)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment	(1,176)	(688)
Net cash used in investing activities	(1,176)	(688)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common shares for cash	380,678	1,675,637
Payment of stock issuance costs	(113,866)
Refund for fractional stock	(117)
Advance from related parties	7,116	12,222
Repayments to related parties	(3,040)	(8,087)
Net cash provided by financing activities	270,771	1,679,772
Effects on changes in foreign exchange rate	60,363	1,511
Net change in cash and cash equivalents	(3,144,709)	(50,985)
Cash and cash equivalents - beginning of period	4,423,965	337,424
Cash and cash equivalents - end of period	1,279,256	286,439
Supplemental Cash Flow
Cash paid for interest	0	0
Cash paid for income taxes	0	0
NON-CASH FINANCING AND INVESTING ACTIVITIES:
Reclass of warrant derivative liability from equity		997,274
Common shares issued for deposit of exercise of the license		539,417
Deferred offering costs incurred		$ 291,670
Common shares issued for acquisition of license offset against stock payable	539,417
Common shares issued for settlement of stock payable	100,000
Additional issuance of Series D shares per the terms of the subscription agreements	7
Cancellation of common shares	$ 6

ORGANIZATION AND DESCRIPTION OF

ORGANIZATION AND DESCRIPTION OF BUSINESS	9 Months Ended
	May 31, 2020
Organization And Description Of Business [Abstract]
ORGANIZATION AND DESCRIPTION OF BUSINESS	NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS ARTELO BIOSCIENCES, INC. (“we”, “us”, “our”, the “Company”) is a Nevada corporation incorporated on May 2, 2011. It is based in San Diego County, California. The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America, and the Company’s fiscal year end is August 31. Effective on February 10, 2017, the Company changed its name from “Knight Knox Development Corp.,” to “Reactive Medical Inc.” On April 14, 2017, the Company changed its name from “Reactive Medical Inc.” to “Artelo Biosciences, Inc.” The Company registered fully owned subsidiaries in Ireland, Trinity Reliant Ventures Limited, on November 11, 2016 and in the UK, Trinity Research & Development Limited, on June 2, 2017. On January 8, 2020 Trinity Research and Development Limited changed its name to Artelo Biosciences Limited. The Company incorporated a fully owned subsidiary in Canada, Artelo Biosciences Corporation, on March 18, 2020. Operations in the subsidiaries have been consolidated in the financial statements. The Company intends to license, develop and commercialize novel cannabinoid therapeutic treatments. Reverse stock split The Company filed a Certificate of Change with the Secretary of State of Nevada, pursuant to which, effective on June 20, 2019, the Company effected a one-for-eight reverse split of its authorized and issued and outstanding common stock (the “Reverse Stock Split”). The number of authorized shares of common stock was reduced from 150,000,000 to 18,750,000. The Company’s authorized Preferred Stock was reduced from 50,000,000 to 6,250,000. All share and per share information in these financial statements retroactively reflect this reverse stock split.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	May 31, 2020
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The Company prepares its financial statements in accordance with rules and regulations of the Securities and Exchange Commission (“SEC”) and GAAP in the United States of America. The accompanying interim financial statements have been prepared in accordance with GAAP for interim financial information in accordance with Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the Company’s opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. While management of the Company believes that the disclosures presented herein are adequate and not misleading, these interim financial statements should be read in conjunction with the audited financial statements and the footnotes thereto for the year ended August 31, 2019 contained in the Company’s Form 10-K filed on November 25, 2019. Basis of Consolidation The financial statements have been prepared on a consolidated basis, with the Company’s wholly-owned subsidiaries, Trinity Reliant Ventures Limited, Artelo Biosciences Limited and Artelo Biosciences Corporation. Operating Leases The Company determines if an arrangement is a lease at inception in accordance with ASC 842 - Leases. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities in our balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in our balance sheets. As all of the Company’s leases are month to month, no ROU nor operating lease liabilities have been recorded as of . The new accounting standards related to ASC – 842 were effective for the Company on September 1, 2019. Adoption of the standard did not have any impact on the Company due to the month to month nature of the Company’s existing leases. Loss per Share Basic earnings per share (“EPS”) is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method and as if converted method. Dilutive potential common shares include outstanding stock options and warrants. For the nine months ended May 31, 2020 and 2019, respectively, the following common stock equivalents were excluded from the computation of diluted net loss per share as the result was anti-dilutive. May 31, 2020 2019 Stock options 281,834 50,000 Warrants 2,334,937 732,351 2,616,771 782,351 Covid 19 As the COVID-19 pandemic is still evolving at this time and much of its impact remains unknown, the Company is not able to predict the impact it may have on the development of the its product candidates and business. The severity of the COVID-19 pandemic could also negatively impact the Company’s access to its existing supply chain by delaying the delivery of key raw materials used in its product candidates and therefore delay the delivery of such products for use in its clinical trials. Any of these results could have a material adverse impact to our business. Reclassification Certain reclassifications have been made to the prior year financial statements to conform to the current period presentation. The reclassification had no impact on previously reported net loss or accumulated deficit.

GOING CONCERN

GOING CONCERN	9 Months Ended
	May 31, 2020
Going Concern [Abstract]
GOING CONCERN	NOTE 3 - GOING CONCERN The Company’s financial statements are prepared using GAAP applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. During the nine months ended May 31, 2020, the Company had a net loss of $3,627,678. As of May 31, 2020, the Company had an accumulated deficit of $8,438,434. The Company has not established any revenue to cover its operating costs, and will require additional capital to continue its operating plan. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations. These factors raise substantial doubt about its ability to continue as a going concern. In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management’s plan to obtain such resources for the Company includes: sales of equity instruments; traditional financing, such as loans; and obtaining capital from management and significant stockholders sufficient to meet its minimum operating expenses. However, management cannot provide any assurance that the Company will be successful in accomplishing this plan. There is no assurance that the Company will be able to obtain sufficient additional funds when needed or that such funds, if available, will be obtainable on terms satisfactory to the Company. In addition, profitability will ultimately depend upon the level of revenues received from business operations. However, there is no assurance that the Company will attain profitability. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	9 Months Ended
	May 31, 2020
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 4 - RELATED PARTY TRANSACTIONS During the nine months ended May 31, 2020, the president and an officer of the Company incurred $1,428 of expenses on behalf of the Company that were not reimbursed. The amount owed to this related party as of May 31, 2020 and August 31, 2019 is $5,160 and $3,732, respectively. The amounts are non-interest bearing and have no terms of repayment. During the nine months ended May 31, 2020, the Senior Vice President, European Operations, who is a major shareholder, incurred $5,688 of expenses on behalf of the Company. $3,040, including foreign exchange loss of $17 of this amount was repaid during the nine months ended May 31, 2020. The amount owed to this related party as of May 31, 2020 and August 31, 2019 is $2,665 and $0, respectively. The amounts are non-interest bearing and have no terms of repayment. During the nine months ended May 31, 2020, a company owned by the Senior Vice President, European Operations, who is a major shareholder, provided consulting services worth $49,000 of which., $5,000 was outstanding. as of May 31, 2020

INTANGIBLE ASSET

INTANGIBLE ASSET	9 Months Ended
	May 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
INTANGIBLE ASSET	NOTE 5 – INTANGIBLE ASSET During the year ended August 31, 2019, the Company made a $1,500,000 payment and recorded stock payable of 61,297 shares of common stock, valued at $539,417 for the exercise of an option for an exclusive worldwide license to develop and commercialize products comprising or containing the compound NEO1940. During the nine months ended May 31, 2020, the Company issued 61,297 shares of common stock (Note 6). The Company has capitalized the costs associated with acquiring the worldwide license as an intangible asset at a value of $2,039,417 as of May 31, 2020 and August 31, 2019. During the quarter ended May 31, 2020, no subsequent costs incurred met the criteria for capitalization as an intangible asset.

Equity

Equity	9 Months Ended
	May 31, 2020
Equity [Abstract]
EQUITY	NOTE 6 - EQUITY Preferred shares The Company has authorized 6,250,000 shares of preferred stock with a par value of $0.001 per share. During the nine months ended May 31, 2020, there were no issuances of preferred stock. Common Shares The Company has authorized 18,750,000 shares of common stock with a par value of $0.001 per share. Each share of common stock entitles the holder to one vote, in person or proxy, on any matter on which an action of the stockholders of the Company is sought. During the nine months ended May 31, 2020, the Company issued 386,238 shares of common stock as follows: • 61,297 • 11,363 $ • 7,373 shares of common stock were issued for additional issuance of Series D per the terms of the subscription agreements. • 306,205 shares of common stock were issued for cash of $380,678, of which 45,834 shares were issued to our officers and directors for $55,000 and 260,371 shares were sold in connection with the Company’s at -the-market equity program (see below) for proceeds net of offering costs of $358,198. The Company also deferred offering costs of $98,715 and incurred stock issuance costs of $15,151 related to shares sold in the prior period. On December 2, 2019, 6,250 shares of common stock previously issued to a director of the Company were cancelled upon the resignation of the director from the Company. As a result, the Company reversed an expense of $2,500 which was recorded in prior quarter. $31,500 of stock compensation expense for four members of the Company’s Board of Directors. The unamortized value of the stock-based compensation as of is $44,333. Equity Distribution On April 13, 2020, the Company entered into an Equity Distribution Agreement with Maxim Group LLC (the “Agent”) to create an at-the-market equity program under which it may sell up to an aggregate of $1,475,000 of shares of the Company’s common stock (the “Shares”) from time to time through the Agent, as sales agent, subject to any applicable limits when using Form S-3. The Agent will be entitled to compensation at a commission rate of 2.0% of the gross sales price per sold share of common stock. Warrants A summary of activity during the nine months ended May 31, 2020 follows: Weighted Weighted Number of Average Average shares Exercise Price Life (years) Outstanding, August 31, 2019 2,334,937 $ 8.12 4.31 Granted — — — Forfeited — — — Exercised — — — Outstanding, 2,334,937 $ 8.12 3.55 The intrinsic value of the warrants as of May 31, 2020 is $0. All of the outstanding warrants are exercisable as of May 31, 2020. Stock Options 2018 Equity Incentive Plan On December 2, 2019, 22,250 shares of common stock previously granted to a director of the Company in the form of a stock option were cancelled upon the resignation On December 6, 2019, the Company granted 10,000 shares of common stock to a director of the Company in the form of a stock option valued at $24,401. The exercise price per share is $2.65 and the stock options expire on December 6, 2029. On December 6, 2019, the Company granted 40,000 shares of common stock to a director of the Company in the form of a stock option valued at $97,606. The exercise price per share is $2.65 and the stock options expire on December 6, 2029. The shares vest 1/48th monthly over a period of four years On January 1, 2020, the Company granted 24,000 shares of common stock to a consultant in the form of a stock option valued at $67,976 The exercise price per share is $2.12 and the stock options expire on December 13, 2029. The shares vest 1/48th monthly over a period of four years, beginning on January 31, 2020 and on the last day of each month thereafter. The Company utilizes the Black-Scholes model to value the stock options. The Company utilized the following assumptions: Nine Months Ended Year Ended May 31, August 31, 2020 2019 Expected term 4.34 - 5 years 5 years Expected average volatility 155 % 158 % Expected dividend yield — — Risk-free interest rate 1.66% - 1.67 % 1.40 - 1.78 % During the nine months ended May 31, 2020, $294,898 was expensed, and as of , $449,833 remains unamortized. The intrinsic value of the 281,834 options as of is $0, and the weighted average value of the remaining life of the options is 9.15 years. The following is a summary of stock option activity during the nine months ended May 31, 2020: Options Outstanding Number of Weighted Average Weighted Average Options Exercise Price Remaining life (years) Outstanding, August 31, 2019 234,000 $ 3.88 $ 9.78 Granted 74,000 2.48 10.00 Exercised — — — Forfeited/canceled (26,166 ) $ 3.31 $ 9.10 Outstanding 281,834 $ 3.57 $ 9.15 The following table summarizes information relating to exercisable stock options as of May 31, 2020: Options Outstanding Options Exercisable Number Weighted Average Weighted Number Weighted of Remaining Average of Average Options Contractual life (in years) Exercise Price Shares Exercise Price 46,084 8.22 $ 10.80 30,244 $ 10.80 2,500 9.14 $ 3.12 2,500 $ 3.12 159,250 9.25 $ 1.99 98,317 $ 1.99 50,000 9.52 $ 2.65 6,250 $ 2.65 24,000 9.54 $ 2.12 2,500 $ 2.12 281,834 9.15 3.57 139,811 3.95

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	May 31, 2020
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 7 – COMMITMENTS AND CONTINGENCIES The Company has certain financial commitments in relation to Research and Development contracts as of May 31, 2020, as follows: · The Company is invoiced monthly and quarterly in connection with several Research and Development contracts. · The Company may be obligated to make additional payments related to Research and Development contracts entered into, dependent on the progress and milestones achieved through the programs. · Our principal executive office is currently located at 888 Prospect Street, Suite 210, La Jolla, CA, 92037, U.S. Additionally, we have an office located at 29 Fitzwilliam Street Upper, Dublin 2 Ireland which serves as administrative space for managing our European subsidiaries: Trinity Reliant Ventures, Ltd (Ireland) and Artelo Biosciences Limited (U.K.). We do not currently own any properties, laboratories, or manufacturing facilities. The leases for our office space are month-to-month.

DERIVATIVE LIABILITY AND FAIR V

DERIVATIVE LIABILITY AND FAIR VALUE MEASUREMENTS	9 Months Ended
	May 31, 2020
Derivative Liability And Fair Value Measurements [Abstract]
DERIVATIVE LIABILITY AND FAIR VALUE MEASUREMENTS	NOTE 8 – DERIVATIVE LIABILITY AND FAIR VALUE MEASUREMENTS The Company recognized a derivative liability related to the purchase price protection clause associated with a previous a private placement offering. Additional units would be issued to the unit holder if the Company should issue common stock or the equivalent at a share price less than $7.60. In accordance with ASC 815-10- Derivatives and Hedging we measured the derivative liability using a Monte Carlo pricing model. Accordingly, at the end of each quarterly reporting date, the derivative fair market value is re-measured and adjusted to current market value. Changes in the fair value of the warrant liability were as follows: Fair value – August 31, 2019 $ 29,501 Change in fair value for the period of warrant derivative liability (29,501 ) Fair value – May 31, 2020 — As of May 31, 2020, there is no derivative liability associated with the shares of common stock issued pursuant to the Series E private offering as they no longer meet the criteria for price protection.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	May 31, 2020
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 9 – SUBSEQUENT EVENTS Subsequent to May 31, 2020, we sold an aggregate of 762,762 shares of common stock under the ATM Offering at an average price of $1.45 per common share for net proceeds of $1,087,118. On June 22, 2020, the Company executed and delivered a Project Invention Exercise Notice to The Research Foundation for the State University of New York (the “Foundation”) indicating that the Company wishes to obtain a commercial license to the Foundation rights in the certain compounds (together, the “Project Invention”). The Company shall pay a $25,000 fee to the Foundation, upon which the Foundation shall expand the definition of Licensed Patents in the License Agreement with Stony Brook University, by and between the Company and Stony Brook University, dated January 18, 2018, to include the Project Invention.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	May 31, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The Company prepares its financial statements in accordance with rules and regulations of the Securities and Exchange Commission (“SEC”) and GAAP in the United States of America. The accompanying interim financial statements have been prepared in accordance with GAAP for interim financial information in accordance with Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the Company’s opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. While management of the Company believes that the disclosures presented herein are adequate and not misleading, these interim financial statements should be read in conjunction with the audited financial statements and the footnotes thereto for the year ended August 31, 2019 contained in the Company’s Form 10-K filed on November 25, 2019.
Basis of Consolidation	Basis of Consolidation The financial statements have been prepared on a consolidated basis, with the Company’s wholly-owned subsidiaries, Trinity Reliant Ventures Limited, Artelo Biosciences Limited and Artelo Biosciences Corporation.
Operating Leases	Operating Leases The Company determines if an arrangement is a lease at inception in accordance with ASC 842 - Leases. Operating leases are included in operating lease right-of-use (“ROU”) assets, other current liabilities, and operating lease liabilities in our balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in our balance sheets. As all of the Company’s leases are month to month, no ROU nor operating lease liabilities have been recorded as of . The new accounting standards related to ASC – 842 were effective for the Company on September 1, 2019. Adoption of the standard did not have any impact on the Company due to the month to month nature of the Company’s existing leases.
Loss per share	Loss per Share Basic earnings per share (“EPS”) is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted EPS is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential common shares outstanding during the period using the treasury stock method and as if converted method. Dilutive potential common shares include outstanding stock options and warrants. For the nine months ended May 31, 2020 and 2019, respectively, the following common stock equivalents were excluded from the computation of diluted net loss per share as the result was anti-dilutive. May 31, 2020 2019 Stock options 281,834 50,000 Warrants 2,334,937 732,351 2,616,771 782,351
Covid 19	Covid 19 As the COVID-19 pandemic is still evolving at this time and much of its impact remains unknown, the Company is not able to predict the impact it may have on the development of the its product candidates and business. The severity of the COVID-19 pandemic could also negatively impact the Company’s access to its existing supply chain by delaying the delivery of key raw materials used in its product candidates and therefore delay the delivery of such products for use in its clinical trials. Any of these results could have a material adverse impact to our business.
Reclassification	Reclassification Certain reclassifications have been made to the prior year financial statements to conform to the current period presentation. The reclassification had no impact on previously reported net loss or accumulated deficit.

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended
	May 31, 2020
Accounting Policies [Abstract]
Schedule of computation of diluted net loss per share	May 31, 2020 2019 Stock options 281,834 50,000 Warrants 2,334,937 732,351 2,616,771 782,351

Equity (Tables)

Equity (Tables)	9 Months Ended
	May 31, 2020
Equity [Abstract]
Schedule of activity warrants outstanding	Weighted Weighted Number of Average Average shares Exercise Price Life (years) Outstanding, August 31, 2019 2,334,937 $ 8.12 4.31 Granted — — — Forfeited — — — Exercised — — — Outstanding, 2,334,937 $ 8.12 3.55
Schedule of stock options assumptions	Nine Months Ended Year Ended May 31, August 31, 2020 2019 Expected term 4.34 - 5 years 5 years Expected average volatility 155 % 158 % Expected dividend yield — — Risk-free interest rate 1.66% - 1.67 % 1.40 - 1.78 %
Schedule of stock option activity	Options Outstanding Number of Weighted Average Weighted Average Options Exercise Price Remaining life (years) Outstanding, August 31, 2019 234,000 $ 3.88 $ 9.78 Granted 74,000 2.48 10.00 Exercised — — — Forfeited/canceled (26,166 ) $ 3.31 $ 9.10 Outstanding 281,834 $ 3.57 $ 9.15
Schedule of exercisable stock options outstanding	Options Outstanding Options Exercisable Number Weighted Average Weighted Number Weighted of Remaining Average of Average Options Contractual life (in years) Exercise Price Shares Exercise Price 46,084 8.22 $ 10.80 30,244 $ 10.80 2,500 9.14 $ 3.12 2,500 $ 3.12 159,250 9.25 $ 1.99 98,317 $ 1.99 50,000 9.52 $ 2.65 6,250 $ 2.65 24,000 9.54 $ 2.12 2,500 $ 2.12 281,834 9.15 3.57 139,811 3.95

DERIVATIVE LIABILITY AND FAIR_2

DERIVATIVE LIABILITY AND FAIR VALUE MEASUREMENTS (Tables)	9 Months Ended
	May 31, 2020
Derivative Liability And Fair Value Measurements [Abstract]
Schedule of fair value of warrant liability	Fair value – August 31, 2019 $ 29,501 Change in fair value for the period of warrant derivative liability (29,501 ) Fair value – May 31, 2020 —

ORGANIZATION AND DESCRIPTION _2

ORGANIZATION AND DESCRIPTION OF BUSINESS (Detail Textuals) - shares	May 31, 2020	Aug. 31, 2019	Aug. 31, 2018
Schedule Of Organization And Description Of Business [Line Items]
Common stock, shares authorized	18,750,000	18,750,000	150,000,000
Preferred stock, shares authorized	6,250,000	6,250,000	50,000,000

SUMMARY OF SIGNIFICANT ACCOUN_4

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - shares	9 Months Ended
	May 31, 2020	May 31, 2019
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from the computation of diluted net loss	2,616,771	782,351
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from the computation of diluted net loss	281,834	50,000
Warrant
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive securities excluded from the computation of diluted net loss	2,334,937	732,351

GOING CONCERN (Detail Textuals)

GOING CONCERN (Detail Textuals) - USD ($)	3 Months Ended						9 Months Ended
	May 31, 2020	Feb. 29, 2020	Nov. 30, 2019	May 31, 2019	Feb. 28, 2019	Nov. 30, 2018	May 31, 2020	May 31, 2019	Aug. 31, 2019
Going Concern [Abstract]
Net loss	$ (951,191)	$ (1,370,126)	$ (1,306,361)	$ (344,883)	$ (424,789)	$ (556,903)	$ (3,627,678)	$ (1,326,575)
Accumulated deficit	$ (8,438,434)						$ (8,438,434)		$ (4,810,756)

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Detail Textuals) - USD ($)	9 Months Ended
	May 31, 2020	Aug. 31, 2019
Related Party Transaction [Line Items]
Due to related parties	$ 12,825	$ 3,732
Former President, and current Senior Vice President, European Operations
Related Party Transaction [Line Items]
Expenses paid by related party	5,688
Due to related parties	2,665	0
Foreign exchange loss of related party	17
Repayments to related party	3,040
President
Related Party Transaction [Line Items]
Expenses paid by related party	1,428
Due to related parties	5,160	$ 3,732
Senior Vice President, European Operations
Related Party Transaction [Line Items]
Consulting services	49,000
Consulting services outstanding	$ 5,000

INTANGIBLE ASSET (Detail Textua

INTANGIBLE ASSET (Detail Textuals) - USD ($)	9 Months Ended	12 Months Ended
	May 31, 2020	Aug. 31, 2019
Indefinite-lived Intangible Assets [Line Items]
Intangible asset	$ 2,039,417	$ 2,039,417
NEO1940
Indefinite-lived Intangible Assets [Line Items]
Payments to acquire intangible assets		$ 1,500,000
Number of common stock payable recorded		61,297
Amount of stock options exercise to develop product		$ 539,417
Number of common stock issued	61,297

Equity (Details)

Equity (Details) - USD ($)	9 Months Ended	12 Months Ended
	May 31, 2020	Aug. 31, 2019
Number Of Shares [Roll Forward]
Number of shares Outstanding	2,334,937
Number of warrant granted	0
Number of warrant forfeited	0
Number of warrant exercised	0
Number of shares Outstanding	2,334,937	2,334,937
Number Of Warrant Granted [Roll Forward]
Weighted Average Exercise Price, Outstanding	$ 8.12
Weighted Average Exercise Price Granted	0
Weighted Average Exercise Price Forfeited	0
Weighted Average Exercise Price Exercised	0
Weighted Average Exercise Price, Outstanding	$ 8.12	$ 8.12
Weighted Average Life [Roll Forward]
Weighted Average Life (years), Outstanding	3 years 6 months 18 days	4 years 3 months 21 days

Equity (Details 1)

Equity (Details 1)	9 Months Ended	12 Months Ended
	May 31, 2020	Aug. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term		5 years
Expected volatility	155.00%	158.00%
Expected dividend yield	0.00%	0.00%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term	4 years 4 months 2 days
Risk free interest rate	1.66%	1.40%
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term	5 years
Risk free interest rate	1.67%	1.78%

Equity (Details 2)

Equity (Details 2) - $ / shares	9 Months Ended	12 Months Ended
	May 31, 2020	Aug. 31, 2019
Number of Options Outstanding
Number of Options Outstanding	234,000
Number of shares granted during period	74,000
Number of Options Exercised	0
Number of Options Forfeited/canceled	(26,166)
Number of Options Outstanding	281,834	234,000
Weighted Average Exercise Price Options Outstanding
Weighted Average Exercise Price, Outstanding	$ 3.88
Weighted Average Exercise Price, Granted	2.48
Weighted Average Exercise Price, Forfeited/canceled	3.31
Weighted Average Exercise Price, Outstanding	$ 3.57	$ 3.88
Weighted Average Remaining Contractual life, Outstanding (in years)	9 years 1 month 24 days	9 years 9 months 10 days
Weighted Average Remaining Contractual life, Granted (in years)	10 years
Weighted Average Remaining Contractual life, Forfeited (in years)	9 years 1 month 6 days

Equity (Details 3)

Equity (Details 3) - $ / shares	9 Months Ended	12 Months Ended
	May 31, 2020	Aug. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding	281,834	234,000
Weighted Average Remaining Contractual life, Outstanding (in years)	9 years 1 month 24 days	9 years 9 months 10 days
Weighted Average Exercise Price	$ 3.57
Options Exercisable Number of shares	139,811
Options Exercisable Weighted Average Exercise Price	$ 3.95
46,084
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding	46,084
Weighted Average Remaining Contractual life, Outstanding (in years)	8 years 2 months 19 days
Weighted Average Exercise Price	$ 10.80
Options Exercisable Number of shares	30,244
Options Exercisable Weighted Average Exercise Price	$ 10.80
2,500
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding	2,500
Weighted Average Remaining Contractual life, Outstanding (in years)	9 years 1 month 20 days
Weighted Average Exercise Price	$ 3.12
Options Exercisable Number of shares	2,500
Options Exercisable Weighted Average Exercise Price	$ 3.12
159,250
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding	159,250
Weighted Average Remaining Contractual life, Outstanding (in years)	9 years 3 months
Weighted Average Exercise Price	$ 1.99
Options Exercisable Number of shares	98,317
Options Exercisable Weighted Average Exercise Price	$ 1.99
50,000
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding	50,000
Weighted Average Remaining Contractual life, Outstanding (in years)	9 years 6 months 7 days
Weighted Average Exercise Price	$ 2.65
Options Exercisable Number of shares	6,250
Options Exercisable Weighted Average Exercise Price	$ 2.65
24,000
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of options outstanding	24,000
Weighted Average Remaining Contractual life, Outstanding (in years)	9 years 6 months 14 days
Weighted Average Exercise Price	$ 2.12
Options Exercisable Number of shares	2,500
Options Exercisable Weighted Average Exercise Price	$ 2.12

Equity (Detail Textuals)

Equity (Detail Textuals) - USD ($)	3 Months Ended						9 Months Ended
	May 31, 2020	Feb. 29, 2020	Nov. 30, 2019	May 31, 2019	Feb. 28, 2019	Nov. 30, 2018	May 31, 2020	Aug. 31, 2019	Aug. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Preferred stock, shares authorized	6,250,000						6,250,000	6,250,000	50,000,000
Preferred stock, par value (in dollars per share)	$ 0.001						$ 0.001	$ 0.001
Common Stock, Shares, Issued	3,733,604						3,733,604	3,353,616
Preferred stock, shares issued	0						0	0
Common stock, shares authorized	18,750,000						18,750,000	18,750,000	150,000,000
Common stock, par value (in dollars per share)	$ 0.001						$ 0.001	$ 0.001
Common stock holder voting rights							Each share of common stock entitles the holder to one vote, in person or proxy
Common shares issued for cash	$ 380,678			$ 417,732	$ 1,087,131	$ 170,774
Derivative liability								$ 29,501
Common shares issued for settlement of debt			$ 100,000				$ 100,000
Stock based compensation							31,500
Remains unamortized stock based expenses							44,333
Warrant intrinsic value	0						0
Deferred offering costs	$ 98,715						98,715
Common stock issuance costs							113,866
Common stock issuance costs			$ 15,151				$ 15,151
Equity distribution agreement with Maxim Group LLC
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate Number of common stock shares may sell	1,475,000						1,475,000
Percentage of compensation commission rate per share of common stock	2.00%						2.00%
Officers and directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common shares issued for cash (in shares)							45,834
Common shares issued for cash							$ 55,000
Equity Incentive Plan 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common shares issued for cash (in shares)							260,371
Common shares issued for cash							$ 358,198
Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common shares issued for cash (in shares)	306,205			54,940	180,365	29,300	386,238
Common shares issued for cash	$ 307			$ 55	$ 181	$ 29	$ 380,678
Common shares issued for acquisition of license (in shares)			61,297	61,297			61,297
Common shares issued for settlement of debt			$ 11
Common shares issued for settlement of debt (in shares)			11,363				11,363
Additional common shares issued (shares)	7,373	7,373

Equity (Detail Textuals 1)

Equity (Detail Textuals 1) - USD ($)	Jan. 01, 2020	Dec. 06, 2019	Dec. 02, 2019	May 31, 2020	Aug. 31, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Remains unamortized stock based expenses				$ 44,333
Number of shares granted during period				74,000
Stock based compensation				$ 31,500
Expected term					5 years
Equity Incentive Plan 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued during period	24,000
Expiration date under plan	Dec. 13, 2029
Intrinsic value	$ 67,976
Exercise price	$ 2.12
Expected term	4 years
Equity Incentive Plan 2018 | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued during period		10,000
Number of shares granted during period			22,250
Expiration date under plan		Dec. 6, 2029
Intrinsic value		$ 24,401
Exercise price		$ 2.65
Equity Incentive Plan - 2018 | Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares issued during period		40,000
Expiration date under plan		Dec. 6, 2029
Intrinsic value		$ 97,606
Exercise price		$ 2.65
Expected term		4 years
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Remains unamortized stock based expenses				$ 449,833
Number of shares granted during period				281,834
Intrinsic value				$ 0
Value of the remaining life of the options				9 years 1 month 24 days
Stock based compensation				$ 294,898

DERIVATIVE LIABILITY AND FAIR_3

DERIVATIVE LIABILITY AND FAIR VALUE MEASUREMENTS (Details) - USD ($)	3 Months Ended		9 Months Ended
	May 31, 2020	May 31, 2019	May 31, 2020	May 31, 2019
Fair Value Of Warrant Liability Roll Forward
Fair value - August 31, 2018			$ 29,501
Change in fair value for the period of warrant derivative liability	$ 0	$ 563,966	29,501	$ 897,096
Warrant liability
Fair Value Of Warrant Liability Roll Forward
Fair value - August 31, 2018			29,501
Change in fair value for the period of warrant derivative liability			(29,501)
Fair value - August 31, 2019	$ 0		$ 0

DERIVATIVE LIABILITY AND FAIR_4

DERIVATIVE LIABILITY AND FAIR VALUE MEASUREMENTS (Detail Textuals)	May 31, 2020$ / shares
Series E offering
Derivative Liability And Fair Value Measurements [Line Items]
Share price	$ 7.60

SUBSEQUENT EVENTS (Detail Textu

SUBSEQUENT EVENTS (Detail Textuals) - Subsequent event - USD ($)	1 Months Ended
	Jul. 10, 2020	Jun. 22, 2020
Subsequent Event [Line Items]
Number of issuance of common shares	762,762
Average issued price per share	$ 1.45
Proceeds from issuance of common stock	$ 1,087,118	$ 25,000