Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 14, 2019 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | Avalon GloboCare Corp. | |
Entity Central Index Key | 0001630212 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2019 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 75,771,056 | |
Entity Filer Number | 000-55709 | |
Entity Interactive Data Current | Yes | |
Entity Incorporation State Country Code | DE |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
CURRENT ASSETS: | ||
Cash | $ 1,072,340 | $ 2,252,287 |
Accounts receivable, net of allowance for doubtful accounts | 9,325 | 9,739 |
Accounts receivable - related party, net of allowance for doubtful accounts | 167,870 | |
Tenants receivable, net of allowance for doubtful accounts | 57,531 | 42,484 |
Security deposit | 24,979 | 127,263 |
Prepaid expenses - related parties | 34,190 | |
Prepaid expenses and other current assets | 475,113 | 1,159,469 |
Total Current Assets | 1,807,158 | 3,625,432 |
NON-CURRENT ASSETS: | ||
Prepayment for long-term assets | 25,180 | |
Property and equipment, net | 624,592 | 249,555 |
Investment in real estate, net | 7,775,981 | 7,879,885 |
Intangible assets, net | 1,255,689 | |
Equity method investment | 436,100 | 385,162 |
Total Non-current Assets | 8,861,853 | 9,770,291 |
Total Assets | 10,669,011 | 13,395,723 |
CURRENT LIABILITIES: | ||
Accrued liabilities and other payables | 1,503,659 | 960,191 |
Accrued liabilities and other payables - related parties | 154,692 | 114,829 |
Tenants' security deposit | 78,237 | 66,700 |
Derivative liabilities | 2,595,611 | |
Total Current Liabilities | 4,332,199 | 1,141,720 |
NON-CURRENT LIABILITIES: | ||
Loan payable - noncurrent portion | 1,000,000 | |
Note payable - related party | 590,000 | |
Total Non-current Liabilities | 590,000 | 1,000,000 |
Total Liabilities | 4,922,199 | 2,141,720 |
EQUITY: | ||
Preferred stock, $0.0001 par value; 10,000,000 shares authorized; no shares issued and outstanding at September 30, 2019 and December 31, 2018 | ||
Common stock, $0.0001 par value; 490,000,000 shares authorized; 76,291,056 shares issued and 75,771,056 shares outstanding at September 30, 2019; 73,830,751 shares issued and 73,310,751 shares outstanding at December 31, 2018 | 7,629 | 7,383 |
Additional paid-in capital | 31,983,760 | 24,153,378 |
Less: common stock held in treasury, at cost; 520,000 shares at September 30, 2019 and December 31, 2018 | (522,500) | (522,500) |
Accumulated deficit | (23,913,011) | (11,291,776) |
Statutory reserve | 6,578 | 6,578 |
Accumulated other comprehensive loss - foreign currency translation adjustment | (302,023) | (236,860) |
Total Avalon GloboCare Corp. stockholders' equity | 7,260,433 | 12,116,203 |
Non-controlling interest | (1,513,621) | (862,200) |
Total Equity | 5,746,812 | 11,254,003 |
Total Liabilities and Equity | $ 10,669,011 | $ 13,395,723 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized | 10,000,000 | 10,000,000 |
Preferred stock, issued | ||
Preferred stock, outstanding | ||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, authorized | 490,000,000 | 490,000,000 |
Common stock, issued | 76,291,056 | 73,830,751 |
Common stock, outstanding | 75,771,056 | 73,310,751 |
Treasury stock | 520,000 | 520,000 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
REVENUES | ||||
Real property rental | $ 264,141 | $ 272,444 | $ 795,656 | $ 847,939 |
Medical related consulting services - related parties | 108,520 | 71,398 | 234,214 | 213,394 |
Development services and sales of developed products | 10,555 | 69,661 | 37,237 | 156,176 |
Total Revenues | 383,216 | 413,503 | 1,067,107 | 1,217,509 |
COSTS AND EXPENSES | ||||
Real property operating expenses | 193,738 | 190,899 | 617,173 | 597,114 |
Medical related consulting services - related parties | 94,442 | 64,196 | 202,908 | 188,911 |
Development services and sales of developed products | 41,808 | 40,386 | 103,899 | 98,999 |
Total Costs and Expenses | 329,988 | 295,481 | 923,980 | 885,024 |
REAL PROPERTY OPERATING INCOME | 70,403 | 81,545 | 178,483 | 250,825 |
GROSS PROFIT FROM MEDICAL RELATED CONSULTING SERVICES | 14,078 | 7,202 | 31,306 | 24,483 |
GROSS (LOSS) PROFIT FROM DEVELOPMENT SERVICES AND SALES OF DEVELOPED PRODUCTS | (31,253) | 29,275 | (66,662) | 57,177 |
OTHER OPERATING EXPENSES: | ||||
Compensation and related benefits | 2,187,959 | 569,915 | 6,388,292 | 1,596,181 |
Research and development expenses | 265,139 | 1,384 | 1,367,310 | 1,647 |
Other general and administrative | 2,066,466 | 1,926,141 | 5,662,926 | 3,642,048 |
Impairment loss | 1,010,011 | 1,010,011 | ||
Total Other Operating Expenses | 5,529,575 | 2,497,440 | 14,428,539 | 5,239,876 |
LOSS FROM OPERATIONS | (5,476,347) | (2,379,418) | (14,285,412) | (4,907,391) |
OTHER INCOME (EXPENSE) | ||||
Interest expense | (2,356) | (25,205) | (36,875) | (287,123) |
Interest expense - related party | (8,842) | (23,425) | ||
Change in fair value of warrants liabilities | 1,160,137 | 1,621,630 | ||
Financing expense | (525,418) | |||
Loss from equity-method investment | (25,266) | (48,353) | ||
Foreign currency transaction gain (loss) | 16,125 | 16,125 | (106,929) | |
Other income | 2,491 | 1,372 | 3,918 | 3,408 |
Total Other Income (Expense), net | 1,142,289 | (23,833) | 1,007,602 | (390,644) |
LOSS BEFORE INCOME TAXES | (4,334,058) | (2,403,251) | (13,277,810) | (5,298,035) |
INCOME TAXES | ||||
NET LOSS | (4,334,058) | (2,403,251) | (13,277,810) | (5,298,035) |
LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST | (475,863) | (58,581) | (656,575) | (177,392) |
NET LOSS ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS | (3,858,195) | (2,344,670) | (12,621,235) | (5,120,643) |
COMPREHENSIVE LOSS: | ||||
NET LOSS | (4,334,058) | (2,403,251) | (13,277,810) | (5,298,035) |
OTHER COMPREHENSIVE LOSS | ||||
Unrealized foreign currency translation loss | (69,388) | (94,069) | (60,009) | (137,438) |
COMPREHENSIVE LOSS | (4,403,446) | (2,497,320) | (13,337,819) | (5,435,473) |
LESS: COMPREHENSIVE LOSS ATTRIBUTABLE TO NON-CONTROLLING INTEREST | (471,411) | (58,794) | (651,421) | (177,564) |
COMPREHENSIVE LOSS ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS | $ (3,932,035) | $ (2,438,526) | $ (12,686,398) | $ (5,257,909) |
NET LOSS PER COMMON SHARE ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS: | ||||
Basic and diluted | $ (0.05) | $ (0.03) | $ (0.17) | $ (0.07) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: | ||||
Basic and diluted | 75,665,676 | 72,573,462 | 74,859,871 | 71,611,375 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Equity (Unaudited) - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Statutory Reserve | Accumulated Other Comprehensive Loss | Non-controlling Interest | Total |
Beginning balance at Dec. 31, 2017 | $ 7,028 | $ 11,490,285 | $ (3,517,654) | $ 6,578 | $ (91,994) | $ (585,394) | $ 7,308,849 | ||
Beginning balance, Shares at Dec. 31, 2017 | 70,278,622 | ||||||||
Treasury stock purchase | $ (522,500) | (522,500) | |||||||
Treasury stock purchase, Shares | (520,000) | ||||||||
Stock-based compensation and service fees | 526,348 | 526,348 | |||||||
Foreign currency translation adjustment | 52,678 | 160 | 52,838 | ||||||
Net loss for the three months ended | (1,481,579) | (69,390) | (1,550,969) | ||||||
Ending balance at Mar. 31, 2018 | $ 7,028 | 12,016,633 | $ (522,500) | (4,999,233) | 6,578 | (39,316) | (654,624) | 5,814,566 | |
Ending balance, Shares at Mar. 31, 2018 | 70,278,622 | (520,000) | |||||||
Common shares issued in equity raise, net of fees associated with equity raise | $ 311 | 5,056,332 | 5,056,643 | ||||||
Common shares issued in equity raise, net of fees associated with equity raise, Shares | 3,107,000 | ||||||||
Common shares issued for services | $ 17 | 466,983 | 467,000 | ||||||
Common shares issued for services, Shares | 175,000 | ||||||||
Stock-based compensation and service fees | 494,825 | 494,825 | |||||||
Foreign currency translation adjustment | (96,088) | (119) | (96,207) | ||||||
Net loss for the three months ended | (1,294,394) | (49,421) | (1,343,815) | ||||||
Ending balance at Jun. 30, 2018 | $ 7,356 | 18,034,773 | $ (522,500) | (6,293,627) | 6,578 | (135,404) | (704,164) | 10,393,012 | |
Ending balance, Shares at Jun. 30, 2018 | 73,560,622 | (520,000) | |||||||
Refundable deposit exchange for common shares | 2,000,000 | 2,000,000 | |||||||
Repayment made for Share Subscription Agreement | $ (100) | 100 | |||||||
Repayment made for Share Subscription Agreement, Shares | (1,000,000) | ||||||||
Common shares issued in equity raise, net of fees associated with equity raise | $ 93 | 2,007,981 | 2,008,074 | ||||||
Common shares issued in equity raise, net of fees associated with equity raise, Shares | 939,450 | ||||||||
Common shares issued for services | $ 7 | 167,943 | 167,950 | ||||||
Common shares issued for services, Shares | 60,679 | ||||||||
Stock-based compensation and service fees | 612,081 | 612,081 | |||||||
Foreign currency translation adjustment | (93,856) | (213) | (94,069) | ||||||
Net loss for the three months ended | (2,344,670) | (58,581) | (2,403,251) | ||||||
Ending balance at Sep. 30, 2018 | $ 7,356 | 22,822,878 | $ (522,500) | (8,638,297) | 6,578 | (229,260) | (762,958) | 12,683,797 | |
Ending balance, Shares at Sep. 30, 2018 | 73,560,751 | (520,000) | |||||||
Beginning balance at Dec. 31, 2018 | $ 7,383 | 24,153,378 | $ (522,500) | (11,291,776) | 6,578 | (236,860) | (862,200) | 11,254,003 | |
Beginning balance, Shares at Dec. 31, 2018 | 73,830,751 | (520,000) | |||||||
Issuance of common stock upon cashless exercise of options | $ 35 | (35) | |||||||
Issuance of common stock upon cashless exercise of options, Shares | 350,856 | ||||||||
Issuance of common stock upon exercise of warrants | $ 16 | (16) | |||||||
Issuance of common stock upon execrise of warrants, Shares | 158,932 | ||||||||
Stock-based compensation and service fees | 2,272,747 | 2,272,747 | |||||||
Foreign currency translation adjustment | 44,680 | (1,198) | 43,482 | ||||||
Net loss for the three months ended | (4,405,816) | (99,113) | (4,504,929) | ||||||
Ending balance at Mar. 31, 2019 | $ 7,434 | 26,426,074 | $ (522,500) | (15,697,592) | 6,578 | (192,180) | (962,511) | 9,065,303 | |
Ending balance, Shares at Mar. 31, 2019 | 74,340,539 | (520,000) | |||||||
Common shares issued for services | $ 13 | 313,788 | 313,801 | ||||||
Common shares issued for services, Shares | 120,812 | ||||||||
Sale of common stock | $ 171 | 1,411,710 | 1,411,881 | ||||||
Sale of common stock, Shares | 1,714,288 | ||||||||
Stock-based compensation and service fees | 1,524,139 | 1,524,139 | |||||||
Foreign currency translation adjustment | (36,003) | 1,900 | (34,103) | ||||||
Net loss for the three months ended | (4,357,224) | (81,599) | (4,438,823) | ||||||
Ending balance at Jun. 30, 2019 | $ 7,618 | 29,675,711 | $ (522,500) | (20,054,816) | 6,578 | (228,183) | (1,042,210) | 7,842,198 | |
Ending balance, Shares at Jun. 30, 2019 | 76,175,639 | (520,000) | |||||||
Common shares issued for services | $ 11 | 391,856 | 391,867 | ||||||
Common shares issued for services, Shares | 115,417 | ||||||||
Stock-based compensation and service fees | 1,916,193 | 1,916,193 | |||||||
Foreign currency translation adjustment | (73,840) | 4,452 | (69,388) | ||||||
Net loss for the three months ended | (3,858,195) | (475,863) | (4,334,058) | ||||||
Ending balance at Sep. 30, 2019 | $ 7,629 | $ 31,983,760 | $ (522,500) | $ (23,913,011) | $ 6,578 | $ (302,023) | $ (1,513,621) | $ 5,746,812 | |
Ending balance, Shares at Sep. 30, 2019 | 76,291,056 | (520,000) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net loss | $ (13,277,810) | $ (5,298,035) |
Adjustments to reconcile net loss from operations to net cash used in operating activities: | ||
Depreciation and amortization | 430,039 | 383,603 |
Stock-based compensation and service expense | 7,003,077 | 2,224,969 |
Loss on equity method investment | 48,353 | |
Change in warrants derivative liabilities | (1,621,630) | |
Allocated financing costs | 525,418 | |
Impairment loss | 1,010,011 | |
Changes in operating assets and liabilities, | ||
Accounts receivable | 48 | (131,357) |
Accounts receivable-related parties | (174,818) | (226,166) |
Tenants receivable | (15,047) | (12,775) |
Prepaid expenses - related parties | 34,257 | |
Prepaid expenses and other current assets | 240,563 | (119,970) |
Security deposit | 101,318 | (710,098) |
Accrued liabilities and other payables | 326,686 | 403,867 |
Accrued liabilities and other payables - related parties | 39,833 | (35,846) |
Tenants' security deposit | 11,537 | (18,888) |
NET CASH USED IN OPERATING ACTIVITIES | (5,318,165) | (3,540,696) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchase of property and equipment | (379,279) | (49,949) |
Improvement of commercial real estate | (16,321) | (392,571) |
Prepayment made for purchase of long-term assets | (26,223) | |
Additional investment in equity method investment | (116,545) | |
Payment for previously acquired business | (200,000) | |
NET CASH USED IN INVESTING ACTIVITIES | (538,368) | (642,520) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds received from note payable - related party | 1,000,000 | |
Repayments of note payable - related party | (410,000) | |
Repayments of loan payable | (1,000,000) | (500,000) |
Repurchase of common stock | (522,500) | |
Refund for refundable deposit in connection with Share Subscription Agreement | (1,000,000) | |
Proceeds received from offering | 6,000,008 | 7,551,013 |
Disbursements for offering costs | (896,304) | (486,296) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 4,693,704 | 5,042,217 |
EFFECT OF EXCHANGE RATE ON CASH | (17,118) | (75,895) |
NET (DECREASE) INCREASE IN CASH | (1,179,947) | 783,106 |
CASH - beginning of period | 2,252,287 | 3,027,033 |
CASH - end of period | 1,072,340 | 3,810,139 |
Cash paid for: | ||
Interest | 112,217 | 375,096 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Property and equipment acquired on credit as payable | 80,723 | 93,894 |
Acquisition of equipment by decreasing prepayment for equipment | 153,381 | |
Common stock issued for future services | 33,235 | |
Refundable deposit exchange for common shares | $ 2,000,000 |
Organization and Nature of Oper
Organization and Nature of Operations | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND NATURE OF OPERATIONS | NOTE 1 – ORGANIZATION AND NATURE OF OPERATIONS Avalon GloboCare Corp. (f/k/a Global Technologies Corp.) (the "Company" or "AVCO") is a Delaware corporation. The Company was incorporated under the laws of the State of Delaware on July 28, 2014. On October 19, 2016, the Company entered into and closed a Share Exchange Agreement with the shareholders of Avalon Healthcare System, Inc., a Delaware corporation ("AHS"), each of which are accredited investors ("AHS Shareholders") pursuant to which we acquired 100% of the outstanding securities of AHS in exchange for 50,000,000 shares of our common stock (the "AHS Acquisition"). AHS was incorporated on May 18, 2015 under the laws of the State of Delaware. For accounting purposes, AHS was the surviving entity. The transaction was accounted for as a recapitalization of AHS pursuant to which AHS was treated as the accounting acquirer, surviving and continuing entity although the Company is the legal acquirer. The Company did not recognize goodwill or any intangible assets in connection with this transaction. Accordingly, the Company's historical financial statements are those of AHS and its wholly-owned subsidiary, Avalon Shanghai immediately following the consummation of this reverse merger transaction. The Company's operations now are focused on integrating and managing global healthcare services and resources. We are dedicated to advancing cell-based technologies and therapeutics, as well as empowering high-impact biomedical innovations in CellTech area to accelerate their clinical applications. Our ecosystem covers the areas of cellular immunotherapy and exosome technology. We plan to integrate technologies and services through joint venture and subsidiary structures that bring shareholder value both in the short term, through operational entities and long term, through biomedical innovation development, such as our recent joint venture for the advancement of Chimeric Antigen Receptor (CAR)-T and exosome/extracellular vesicle (EV) technologies. Our wholly subsidiary Avalon Shanghai is engaged in medical related consulting services for customers. AHS owns 100% of the capital stock of Avalon (Shanghai) Healthcare Technology Co., Ltd. ("Avalon Shanghai"), which is a wholly foreign-owned enterprise organized under the laws of the People's Republic of China ("PRC"). Avalon Shanghai was incorporated on April 29, 2016 and is engaged in medical related consulting services for customers. On January 23, 2017, the Company incorporated Avalon (BVI) Ltd., a British Virgin Island company. There was no activity for the subsidiary since its incorporation through September 30, 2019. Avalon (BVI) Ltd. is dormant and is in process of being dissolved. On February 7, 2017, the Company formed Avalon RT 9 Properties, LLC ("Avalon RT 9"), a New Jersey limited liability company. On May 5, 2017, Avalon RT 9 purchased a real property located in Township of Freehold, County of Monmouth, State of New Jersey, having a street address of 4400 Route 9 South, Freehold, NJ 07728. This property was purchased to serve as the Company's world-wide headquarters for all corporate administration and operations. In addition, the property generates rental income. Avalon RT 9 owns this office building. Currently, Avalon RT 9's business consists of the ownership and operation of the income-producing real estate property in New Jersey. The current occupancy rate of the building is 90%. On July 31, 2017, the Company formed Genexosome Technologies Inc. ("Genexosome") in Nevada. On October 25, 2017, Genexosome and the Company entered into a Securities Purchase Agreement pursuant to which the Company acquired 600 shares of Genexosome in consideration of $1,326,087 in cash and 500,000 shares of common stock of the Company. On October 25, 2017, Genexosome entered into and closed an Asset Purchase Agreement with Yu Zhou, MD, PhD, pursuant to which the Company acquired all assets, including all intellectual property, held by Dr. Zhou pertaining to the business of researching, developing and commercializing exosome technologies. In consideration of the assets, Genexosome agreed to pay Dr. Zhou $876,087 in cash, transfer 500,000 shares of common stock of the Company to Dr. Zhou and issue Dr. Zhou 400 shares of common stock of Genexosome. On October 25, 2017, Genexosome entered into and closed a Stock Purchase Agreement with Beijing Jieteng (Genexosome) Biotech Co. Ltd., a corporation incorporated in the PRC on August 7, 2015 ("Beijing Genexosome") and Dr. Zhou, the sole shareholder of Beijing Genexosome, pursuant to which Genexosome acquired all of the issued and outstanding securities of Beijing Genexosome in consideration of a cash payment in the amount of $450,000. The Company has not been able to realize the financial projections provided by Dr. Zhou at the time of the acquisition and has recognized an impairment loss of $1,010,011 related to the intangible asset associated with this acquisition. On July 18, 2018, the Company formed a wholly owned subsidiary, Avactis Biosciences Inc., a Nevada corporation, which will focus on accelerating commercial activities related to cellular therapies, including regenerative medicine with stem/progenitor cells as well as cellular immunotherapy including CAR-T, CAR-NK, TCR-T and others. The subsidiary is designed to integrate and optimize our global scientific and clinical resources to further advance the use of cellular therapies to treat certain cancers. On June 13, 2019, the Company formed a wholly owned subsidiary, International Exosome Association LLC, a Delaware company. There was no activity for the subsidiary since its incorporation through September 30, 2019. Details of the Company's subsidiaries which are included in these consolidated financial statements as of September 30, 2019 are as follows: Name of Subsidiaries Place and date of Incorporation Percentage of Ownership Principal Activities Avalon Healthcare System, Inc. ("AHS") Delaware May 18, 2015 100% held by AVCO Provides medical related consulting services and developing Avalon Cell and Avalon Rehab in United States of America ("USA") Avalon (BVI) Ltd. ("Avalon BVI") British Virgin Island January 23, 2017 100% held by AVCO Dormant, is in process of being dissolved Avalon RT 9 Properties LLC ("Avalon RT 9") New Jersey February 7, 2017 100% held by AVCO Owns and operates an income-producing real property and holds and manages the corporate headquarters Avalon (Shanghai) Healthcare Technology Co., Ltd. ("Avalon Shanghai") PRC April 29, 2016 100% held by AHS Provides medical related consulting services and developing Avalon Cell and Avalon Rehab in China Genexosome Technologies Inc. ("Genexosome") Nevada July 31, 2017 60% held by AVCO Develops proprietary diagnostic and therapeutic products using exosomes Beijing Jieteng (Genexosome) Biotech Co., Ltd. ("Beijing Genexosome") PRC August 7, 2015 100% held by Genexosome Provides development services for hospitals and other customers and sells developed items to hospitals and other customers in China Avactis Biosciences Inc. ("Avactis") Nevada July 18, 2018 100% held by AVCO Integrate and optimize global scientific and clinical resources to further advance cellular therapies, including regenerative medicine with stem/progenitor cells as well as cellular immunotherapy including CAR-T, CAR-NK, TCR-T and others to treat certain cancers International Exosome Association LLC ("Exosome") Delaware June 13, 2019 100% held by AVCO Promotes standardization related to exosome industry |
Basis of Presentation and Liqui
Basis of Presentation and Liquidity and Financial Condition | 9 Months Ended |
Sep. 30, 2019 | |
Basis of Presentation and Going Concern [Abstract] | |
BASIS OF PRESENTATION AND LIQUIDITY AND FINANCIAL CONDITION | NOTE 2 – BASIS OF PRESENTATION AND LIQUIDITY AND FINANCIAL CONDITION Basis of Presentation These interim condensed consolidated financial statements of the Company and its subsidiaries are unaudited. In the opinion of management, all adjustments (consisting of normal recurring accruals) and disclosures necessary for a fair presentation of these interim condensed consolidated financial statements have been included. The results reported in the unaudited condensed consolidated financial statements for any interim periods are not necessarily indicative of the results that may be reported for the entire year. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all information and footnotes necessary for a complete presentation of financial statements in conformity with accounting principles generally accepted in the United States ("U.S. GAAP"). The Company's unaudited condensed consolidated financial statements include the accounts of the Company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on March 26, 2019. Liquidity and Financial Condition The accompanying unaudited condensed consolidated financial statements have been prepared to assume the Company can continue as a going concern, which contemplates continuity of operations through the realization of assets and the settling of liabilities in the ordinary course of business. The Company had $1.1 million in cash on the balance sheet at September 30, 2019. The Company had working capital and an accumulated deficit of $2.5 million and $23.9 million, respectively, on September 30, 2019. Additionally, the Company had a loss from operations in the amount of approximately $14.3 million and cash used in operating activities of $5.3 million for the nine months ended September 30, 2019. On August 29, 2019, the Company entered into a Line of Credit Agreement with a related party (see Note 16) providing the Company with a $20 million line of credit. The Company used the net proceeds from the line of credit to mitigate the going concern. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of the unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles in the United States of America 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 reporting period. Actual results could differ from these estimates. Significant estimates during the three and nine months ended September 30, 2019 and 2018 include the allowance for doubtful accounts, the useful life of property and equipment and investment in real estate, assumptions used in assessing impairment of long-term assets, valuation of deferred tax assets and the associated valuation allowances, and valuation of stock-based compensation. Fair Value of Financial Instruments and Fair Value Measurements The Company adopted the guidance of Accounting Standards Codification ("ASC") 820 for fair value measurements which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: ● Level 1-Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. ● Level 2-Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. ● Level 3-Inputs are unobservable inputs which reflect the reporting entity's own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information. Assets and liabilities measured at fair value on a nonrecurring basis. Intangible assets. The following table provides the liabilities carried at fair value, measured as of September 30, 2019: Quoted Price in Active Markets Significant Other Observable Inputs Significant Balance at Derivative liabilities: Warrants $ - $ - $ 2,595,611 $ 2,595,611 The table below reflects the activity of derivative liabilities measured at fair value for the nine months ended September 30, 2019: Balance of derivative liabilities as of December 31, 2018 $ - Initial fair value of derivative liabilities attributable to warrants issuance with equity raise 4,217,241 Gain from change in the fair value of derivative liabilities (1,621,630 ) Balance of derivative liabilities as of September 30, 2019 $ 2,595,611 ASC 825-10 "Financial Instruments", allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments. Concentrations of Credit Risk Currently, a portion of the Company's operations are carried out in PRC. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC's economy. The Company's operations in PRC are subject to specific considerations and significant risks not typically associated with companies in North America. The Company's results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash, trade accounts receivable and tenants receivable. A portion of the Company's cash is maintained with state-owned banks within the PRC, and none of these deposits are covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts. A portion of the Company's sales are credit sales which is to the customer whose ability to pay is dependent upon the industry economics prevailing in these areas; however, concentrations of credit risk with respect to trade accounts receivable and tenants receivable is limited due to generally short payment terms. The Company also performs ongoing credit evaluations of its customers to help further reduce credit risk. At September 30, 2019 and December 31, 2018, the Company's cash balances by geographic area were as follows: Country: September 30, 2019 December 31, 2018 United States $ 563,078 52.5 % $ 1,035,802 46.0 % China 509,262 47.5 % 1,216,485 54.0 % Total cash $ 1,072,340 100.0 % $ 2,252,287 100.0 % Revenue Recognition Effective January 1, 2018, the Company began recognizing revenue under Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers ("ASC 606"), using the modified retrospective transition method. The impact of adopting the new revenue standard was not material to the Company's consolidated financial statements and there was no adjustment to beginning accumulated deficit on January 1, 2018. The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle: ● Step 1: Identify the contract with the customer ● Step 2: Identify the performance obligations in the contract ● Step 3: Determine the transaction price ● Step 4: Allocate the transaction price to the performance obligations in the contract ● Step 5: Recognize revenue when the company satisfies a performance obligation In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised goods or service that is distinct. A performance obligation meets ASC 606's definition of a "distinct" goods or service (or bundle of goods or services) if both of the following criteria are met: ● The customer can benefit from the goods or service either on its own or together with other resources that are readily available to the customer (i.e., the goods or service is capable of being distinct). ● The entity's promise to transfer the goods or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the goods or service is distinct within the context of the contract). If a goods or service is not distinct, the goods or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. Types of revenue: ● Service fees under consulting agreements with related parties to provide medical related consulting services to its clients. The Company is paid for its services by its clients pursuant to the terms of the written consulting agreements. Each contract calls for a fixed payment. ● Service fees under agreements to perform development services for hospitals and other customers. The Company does not perform contracts that are contingent upon successful results. ● Sales of developed products to hospitals and other customers. Revenue recognition criteria: ● The Company recognizes revenue by providing medical related consulting services under written service contracts with its customers. Revenue related to its service offerings is recognized as the services are performed. ● Revenue from development services performed under written contracts is recognized as services are provided. ● Revenue from sales of developed items to hospitals and other customers is recognized when items are shipped to customers and titles are transferred. The Company does not offer promotional payments, customer coupons, rebates or other cash redemption offers to its customers. Per Share Data ASC Topic 260 "Earnings per Share," requires presentation of both basic and diluted earnings per share ("EPS") with a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Basic EPS excludes dilution. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Basic net loss per share are computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Potentially dilutive common shares consist of the common shares issuable upon the exercise of common stock options and warrants (using the treasury stock method). Common stock equivalents are not included in the calculation of diluted net loss per share if their effect would be anti-dilutive. In a period in which the Company has a net loss, all potentially dilutive securities are excluded from the computation of diluted shares outstanding as they would have had an anti-dilutive impact. The following table summarizes the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Stock options 5,070,000 2,670,000 5,070,000 2,670,000 Warrants 1,714,288 578,891 1,714,288 578,891 Potentially dilutive securities 6,784,288 3,248,891 6,784,288 3,248,891 Reclassification Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications have no effect on the previously reported financial position, results of operations and cash flows. Recent Accounting Standards In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, "Leases" ("ASU 842"), The Company adopted ASU 842 effective January 1, 2019 using the optional transition method of recognizing a cumulative-effect adjustment to the opening balance of accumulated deficit on January 1, 2019. Therefore, comparative financial information was not adjusted and continues to be reported under the prior lease accounting guidance in ASU 840. The Company elected the transition relief package of practical expedients, and as a result, the Company did not assess 1) whether existing or expired contracts contain embedded leases, 2) lease classification for any existing or expired leases, and 3) whether lease origination costs qualified as initial direct costs. The Company elected the short-term lease practical expedient by establishing an accounting policy to exclude leases with a term of 12 months or less. In July 2017, the FASB issued Accounting Standards Update No. 2017-11, Accounting for Certain Financial Instruments with Down Round Features On June 20, 2018, the FASB issued ASU 2018-07, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. For public business entities (PBEs), the amendments in ASU 2018-07 are effective for fiscal years beginning after December 15, 2018, including interim periods therein. Early adoption is permitted if financial statements have not yet been issued (for PBEs), but no earlier than an entity's adoption date of ASC 606. If early adoption is elected, all amendments in the ASU that apply must be adopted in the same period. In addition, if early adoption is elected in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The Company has adopted the ASU 2018-07 in 2019 and it did not have a material impact on the Company's condensed consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures. |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 9 Months Ended |
Sep. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 4 – PREPAID EXPENSES AND OTHER CURRENT ASSETS At September 30, 2019 and December 31, 2018, prepaid expenses and other current assets consisted of the following: September 30, December 31, Prepaid professional fees $ 195,785 $ 607,833 Prepaid research and development service fees - 300,000 Prepaid insurance expense 137,376 72,352 Prepaid dues and subscriptions 41,916 70,000 Other 100,036 109,284 $ 475,113 $ 1,159,469 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 5 – PROPERTY AND EQUIPMENT At September 30, 2019 and December 31, 2018, property and equipment consisted of the following: Useful life September 30, December 31, Laboratory equipment 5 Years $ 690,296 $ 258,345 Office equipment and furniture 3 – 10 Years 39,285 35,627 Leasehold improvement Shorter of useful life or lease term - 24,446 729,581 318,418 Less: accumulated depreciation (104,989 ) (68,863 ) $ 624,592 $ 249,555 For the three months ended September 30, 2019 and 2018, depreciation expense of property and equipment amounted to $23,351 and $21,931, respectively, of which, $820 and $819 was included in real property operating expenses, $16,871 and $16,220 was included in costs of development services and sales of developed products, $633 and $4,892 was included in other operating expenses, and $5,027 and $0 was included in research and development expense, respectively. For the nine months ended September 30, 2019 and 2018, depreciation expense of property and equipment amounted to $64,136 and $42,509, respectively, of which, $2,457 and $2,457 was included in real property operating expenses, $47,356 and $25,852 was included in costs of development services and sales of developed products, $5,078 and $14,200 was included in other operating expenses, and $9,245 and $0 was included in research and development expense, respectively. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | NOTE 6 – INTANGIBLE ASSETS At September 30, 2019 and December 31, 2018, intangible assets consisted of the following: Useful Life September 30, December 31, Patents and other technologies 5 Years $ 1,583,260 $ 1,583,260 Less: accumulated amortization (573,249 ) (327,571 ) Less: impairment loss (1,010,011 ) - $ - $ 1,255,689 For the three months ended September 30, 2019 and 2018, amortization expense amounted to $81,892. For the nine months ended September 30, 2019 and 2018, amortization expense amounted to $245,678. In September 2019, the Company assessed its patents and other technologies for any impairment and concluded that there were indicators of impairment as of September 30, 2019 and the Company calculated that the estimated undiscounted cash flows were less than the carrying amount of those patents and other technologies. The Company has not been able to realize the financial projections provided by Dr. Zhou at the time of the intangible assets purchase and has recognized an impairment loss of $1,010,011 related to the intangible assets for the three and nine months ended September 30, 2019, which reduced the value of patents and other technologies purchased to zero. The Company did not record any impairment charge for the three and nine months ended September 30, 2018. |
Equity Method Investment
Equity Method Investment | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
EQUITY METHOD INVESTMENT | NOTE 7 – EQUITY METHOD INVESTMENT The Company uses the equity method of accounting for its investment in, and earning or loss of, company that it does not control but over which it does exert significant influence. The Company considers whether the fair value of its equity method investment has declined below its carrying value whenever adverse events or changes in circumstances indicate that recorded value may not be recoverable. If the Company considers any decline to be other than temporary (based on various factors, including historical financial results and the overall health of the investee), then a write-down would be recorded to estimated fair value. As of September 30, 2019 and December 31, 2018, the equity method investment amounted to $436,100 and $385,162, respectively. The investment represents the Company's subsidiary, Avalon Shanghai's interest in Epicon Biotech Co., Ltd. ("Epicon"). Epicon was incorporated on August 14, 2018 in the PRC. Avalon Shanghai and the other unrelated company, Jiangsu Unicorn Biological Technology Co., Ltd. ("Unicorn"), accounted for 40% and 60% of the total ownership, respectively. Epicon is focused on cell preparation, third party testing, biological sample repository for commercial and scientific research purposes and the clinical transformation of scientific achievements. The Company treats the equity investment in the condensed consolidated financial statements under the equity method. Under the equity method, the investment is initially recorded at cost, adjusted for any excess of the Company's share of the incorporated-date fair values of the investee's identifiable net assets over the cost of the investment (if any). Thereafter, the investment is adjusted for the post incorporation change in the Company's share of the investee's net assets and any impairment loss relating to the investment. For the three and nine months ended September 30, 2019, the Company's share of Epicon's net loss was $25,266 and $48,353, respectively, which was included in loss from equity-method investment in the accompanying condensed consolidated statements of operations and comprehensive loss. For the three and nine months ended September 30, 2018, the Company's share of Epicon's net loss was $0. Activity recorded for the Company's equity method investment in Epicon is summarized in the following table. Equity investment carrying value at December 31, 2018 $ 385,162 Epicon's net loss attributable to the Company (48,353 ) Payment made for equity method investment 116,545 Foreign currency fluctuation (17,254 ) Equity investment carrying value at September 30, 2019 $ 436,100 The tables below present the summarized financial information, as provided to the Company by the investee, for the unconsolidated company: September 30, December 31, Current assets $ 51,666 $ 301,714 Noncurrent assets 241,541 7,015 Current liabilities 336 38 Noncurrent liabilities - - Equity 292,871 308,691 For the Three Months Ended For the Nine Months Ended Net revenue $ - $ - Gross profit - - Loss from operation 63,165 120,882 Net loss 63,165 120,882 |
Accrued Liabilities and Other P
Accrued Liabilities and Other Payables | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
ACCRUED LIABILITIES AND OTHER PAYABLES | NOTE 8 – ACCRUED LIABILITIES AND OTHER PAYABLES At September 30, 2019 and December 31, 2018, accrued liabilities and other payables consisted of the following: September 30, December 31, Accrued payroll liability $ 2,402 $ 529,472 Accrued professional fees 778,090 166,077 Accrued research and development fee 225,000 - Insurance payable 169,563 45,088 Accrued directors' compensation 107,500 17,500 Accounts payable 84,887 6,695 Interest payable - 75,342 Other 136,217 120,017 $ 1,503,659 $ 960,191 |
Loan Payable
Loan Payable | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
LOAN PAYABLE | NOTE 9 – LOAN PAYABLE On April 19, 2017, the Company entered into a loan agreement, providing for the issuance of a loan in the principal amount of $2,100,000. The term of the loan was one year. On May 3, 2018, the Company signed an extension agreement with a maturity date of March 31, 2019. On August 3, 2018, the Company signed an extension agreement for the loan with a maturity date of March 31, 2020. The annual interest rate for the loan was 10%. The loan was guaranteed by the Company's Chairman, Mr. Wenzhao Lu. The Company repaid principal of $600,000, $500,000 and $1,000,000 in November 2017, April 2018 and April 2019, respectively. As of September 30, 2019, the outstanding principal balance of the loan was $0. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | NOTE 10 – RELATED PARTY TRANSACTIONS Medical Related Consulting Services Revenue from Related Parties and Accounts Receivable – Related Party During the three and nine months ended September 30, 2019 and 2018, medical related consulting services revenue from related parties was as follows: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Medical related consulting services provided to: Beijing Daopei (1) $ - $ 71,398 $ 55,908 $ 213,394 Shanghai Daopei (2) - - 14,180 - Hebei Daopei (3) 108,520 - 164,126 - $ 108,520 $ 71,398 $ 234,214 $ 213,394 (1) Beijing Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. (2) Shanghai Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. (3) Hebei Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. Accounts receivable – related party, net of allowance for doubtful accounts, at September 30, 2019 and December 31, 2018 amounted to $167,870 and $0, respectively, and no allowance for doubtful accounts is deemed to be required on accounts receivable – related party at September 30, 2019 and December 31, 2018. Prepaid Expenses – Related Parties As of September 30, 2019 and December 31, 2018, the Company made a prepayment of $0 and $1,897, respectively, to David Jin, its shareholder, chief executive officer, president and board member, for business travel reimbursement, which has been included in prepaid expenses – related parties on the accompanying condensed consolidated balance sheets. As of September 30, 2019 and December 31, 2018, the Company made a prepayment of $0 and $32,293, respectively, to Meng Li, its shareholder and chief operating officer, for business travel reimbursement, which has been included in prepaid expenses – related parties on the accompanying condensed consolidated balance sheets. Accrued Liabilities and Other Payables – Related Parties As of September 30, 2019 and December 31, 2018, the advance from customer – related party amounted to $0 and $14,829, respectively, which represents a prepayment received from our related party, Beijing Daopei, for medical related consulting services. When the services are performed, the amount recorded as an advance from customer – related party is recognized as revenue. As of September 30, 2019 and December 31, 2018, the Company owed David Jin, its shareholder, chief executive officer, president and board member, $31,267 and $0, respectively, for travel and other miscellaneous reimbursements, which have been included in accrued liabilities and other payables – related parties on the accompanying condensed consolidated balance sheets. In connection with the acquisition discussed elsewhere in this report, the Company acquired Beijing Genexosome for a cash payment of $450,000. As of September 30, 2019 and December 31, 2018, the unpaid acquisition consideration of $100,000, was payable to Dr. Yu Zhou, a director and former co-chief executive officer and 40% owner of Genexosome, and has been included in accrued liabilities and other payables – related parties on the accompanying condensed consolidated balance sheets. As of September 30, 2019 and December 31, 2018, the accrued and unpaid interest related to note payable – related party amounted to $23,425 and $0, respectively, and have been included in accrued liabilities and other payables – related parties on the accompanying condensed consolidated balance sheets. Real Property Management Agreement The Company pays a company, which is controlled by Wenzhao Lu, the Company's largest shareholder and chairman of the Board of Directors, for the management of its commercial real property located in New Jersey. The property management agreement commenced on May 5, 2017 and expired in March 2019. For the three months ended September 30, 2019 and 2018, the management fee related to the property management agreement amounted to $0 and $16,251, respectively. For the nine months ended September 30, 2019 and 2018, the management fee related to the property management agreement amounted to $23,334 and $48,753, respectively. Note Payable – Related Party On March 18, 2019, the Company issued Wenzhao Lu, the Company's largest shareholder and Chairman of the Board of Directors, a Promissory Note in the principal amount of $1,000,000 ("Promissory Note") in consideration of cash in the amount of $1,000,000. The Promissory Note accrues interest at the rate of 5% per annum and matures March 19, 2022. The Company repaid principal of $410,000 in the third quarter of 2019. For the three and nine months ended September 30, 2019, the interest expense related to this note amounted to $8,842 and $23,425, respectively. As of September 30, 2019, the outstanding principal balance of the note and related accrued and unpaid interest for the note was $590,000 and $23,425, respectively. Office Space from Related Party Beijing Genexosome uses office space of a related party, free of rent, which is considered immaterial. |
Derivative Liabilities
Derivative Liabilities | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE LIABILITIES | NOTE 11 – DERIVATIVE LIABILITIES On April 25, 2019, the Company issued 1,714,288 five-year warrants to several third party institutional investors in a registered direct offering (see Note 12). The warrants include the fundamental transaction provisions and the exercise price of the warrants is protected against down-round financing throughout the term of the warrants. Upon evaluation, the warrants meet the definition of derivative liabilities under FASB ASC 815, as the Company cannot avoid a net cash settlement under certain circumstances. Accordingly, the fair value of the warrants was classified as derivative liabilities of $4,217,241 on the issuance date, April 25, 2019. The estimated fair value of the warrants was computed at issuance using Black-Scholes option-pricing model, with the following assumptions: stock price of $2.82, volatility of 142.55%, risk-free rate of 2.33%, annual dividend yield of 0% and expected life of 5 years (see Note 19). The estimated fair value of the outstanding warrants as derivative liabilities was $1,895,611 at September 30, 2019. The estimated fair value of the warrants was computed as of September 30, 2019 using Black-Scholes option-pricing model, with the following assumptions: stock price of $1.87, volatility of 135.00%, risk-free rate of 1.55%, annual dividend yield of 0% and expected life of 4.57 years. Increases or decreases in fair value of the derivative liabilities are included as a component of total other income (expenses) in the accompanying condensed consolidated statements of operations and comprehensive loss for the respective period. The changes to the derivative liabilities for the warrants resulted in a decrease of $1,160,137 and $1,621,630, respectively, in the derivative liabilities and the corresponding increase in other income as a gain for the three and nine months ended September 30, 2019. There were no derivative liabilities in the three and nine months ended September 30, 2018. As of September 30, 2019, the total number of warrants outstanding was 1,714,288 with remaining life of 4.57 years. No warrants were exercised as of September 30, 2019. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
EQUITY | NOTE 12 – EQUITY Common Shares Issued for Warrant Exercise On January 9, 2019, the Company issued 350,856 shares of its common stock upon cashless exercise of warrants to purchase 578,891 shares of common stock. Common Shares Issued for Option Exercise On February 27, 2019, the Company issued 158,932 shares of its common stock upon cashless exercise of options to purchase 200,000 shares of common stock. Common Shares Issued for Service Fee On April 1, 2019, the Company issued a total of 120,812 shares of its common stock in payment of service fee from certain consultants. These shares were valued at $313,800, the fair market values on the grant dates using the reported closing share prices on the dates of grant. On September 23, 2019, the Company issued a total of 115,417 shares of its common stock in payment of service fee from certain consultants. These shares were valued at $391,867, the fair market values on the grant dates using the reported closing share prices on the dates of grant. Units Sold for Cash On April 25, 2019, the Company entered into a purchase agreement with several third party institutional investors for the purchase of 1,714,288 units in a registered direct offering, for gross proceeds of $6,000,008 before placement agent fees and other offering expenses payable by the Company. Each unit was sold at a public offering price of $3.50 and consists of one share of common stock and a warrant to purchase one share of common stock. The Company received net cash proceeds of $5,103,704, net of cash paid for placement agent fees and other offering expenses. The warrants are exercisable immediately as of the date of issuance (the "Initial Exercise Date"), at an exercise price of $3.50 per share, subject to adjustment as provided in the warrants, and expire on the fifth (5 th Options The following table summarizes the shares of the Company's common stock issuable upon exercise of options outstanding at September 30, 2019: Options Outstanding Options Exercisable Range of Number Outstanding at September 30, Range of Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number Exercisable at September 30, 2019 Weighted Average Exercise $ 0.50 2,000,000 7.36 $ 0.50 1,777,778 $ 0.50 1.00 – 1.49 450,000 1.09 – 3.09 1.07 450,000 1.07 2.00 – 2.80 2,560,000 2.58 – 4.26 2.15 1,922,500 2.15 4.76 60,000 4.52 4.76 40,000 4.76 $ 0.50 – 4.76 5,070,000 5.20 $ 1.43 4,190,278 $ 1.36 Stock option activities for the nine months ended September 30, 2019 were as follows: Number of Options Weighted Average Exercise Price Outstanding at December 31, 2018 2,840,000 $ 0.76 Granted 2,430,000 2.18 Terminated / Exercised (200,000 ) 1.00 Outstanding at September 30, 2019 5,070,000 $ 1.43 Options exercisable at September 30, 2019 4,190,278 $ 1.36 Options expected to vest 879,722 $ 1.79 The aggregate intrinsic values of stock options outstanding and stock options exercisable at September 30, 2019 was $3,102,100 and $2,797,656, respectively. The fair values of options granted during the nine months ended September 30, 2019 were estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions: volatility of 149.75% - 151.70%, risk-free rate of 2.28% - 2.49%, annual dividend yield of 0% and expected life of 3.00 – 5.00 years. The aggregate fair value of the options granted during the nine months ended September 30, 2019 was $6,338,844. During the three months ended September 30, 2019 and 2018, the fair value of options of $1,916,193 and $612,081, respectively, has been reflected on the accompanying unaudited condensed consolidated statements of operations and comprehensive loss. During the nine months ended September 30, 2019 and 2018, the fair value of options of $5,713,079 and $1,633,254, respectively, has been reflected on the accompanying unaudited condensed consolidated statements of operations and comprehensive loss. A summary of the status of the Company's nonvested stock options granted as of September 30, 2019 and changes during the nine months ended September 30, 2019 is presented below: Number of Options Weighted Average Exercise Price Nonvested at December 31, 2018 915,555 $ 0.62 Granted 2,430,000 2.18 Vested (2,465,833 ) (1.74 ) Nonvested at September 30, 2019 879,722 $ 1.79 In the three months ended September 30, 2019, the overall value of common stock granted at unit price below $3.50 and stock options granted at exercise price below $3.50 to non-employee is $481,341. Warrants Stock warrants activities during the nine months ended September 30, 2019 were as follows: Number of Warrants Weighted Average Exercise Price Outstanding at December 31, 2018 578,891 $ 1.28 Issued 1,714,288 3.50 Exercised (578,891 ) (1.28 ) Outstanding and exercisable at September 30, 2019 1,714,288 $ 3.50 The following table summarizes the shares of the Company's common stock issuable upon exercise of warrants outstanding at September 30, 2019: Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding at September 30, Remaining Contractual Life (Years) Number Exercisable at September 30, Exercise Price $ 3.50 1,714,288 4.57 1,714,288 $ 3.50 The aggregate intrinsic values of stock warrants outstanding and stock warrants exercisable at September 30, 2019 was $0. |
Statutory Reserve
Statutory Reserve | 9 Months Ended |
Sep. 30, 2019 | |
Statutory Reserve [Abstract] | |
STATUTORY RESERVE | NOTE 13 – STATUTORY RESERVE Avalon Shanghai and Beijing Genexosome operate in the PRC, are required to reserve 10% of their net profit after income tax, as determined in accordance with the PRC accounting rules and regulations. Appropriation to the statutory reserve by the Company is based on profit arrived at under PRC accounting standards for business enterprises for each year. The profit arrived at must be set off against any accumulated losses sustained by the Company in prior years, before allocation is made to the statutory reserve. Appropriation to the statutory reserve must be made before distribution of dividends to shareholders. The appropriation is required until the statutory reserve reaches 50% of the registered capital. This statutory reserve is not distributable in the form of cash dividends. The Company did not make any appropriation to statutory reserve for Avalon Shanghai and Beijing Genexosome during the nine months ended September 30, 2019 as they incurred net losses in the period. |
Noncontrolling Interest
Noncontrolling Interest | 9 Months Ended |
Sep. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
NONCONTROLLING INTEREST | NOTE 14 – NONCONTROLLING INTEREST As of September 30, 2019, Dr. Yu Zhou, a director and former Co-Chief Executive Officer of Genexosome, who owns 40% of the equity interests of Genexosome, which is not under the Company's control. The following is a summary of noncontrolling interest activities in the nine months ended September 30, 2019. Noncontrolling interest at December 31, 2018 $ (862,200 ) Net loss attributable to noncontrolling interest (656,575 ) Foreign currency translation adjustment attributable to noncontrolling interest 5,154 Noncontrolling interest at September 30, 2019 $ (1,513,621 ) |
Restricted Net Assets
Restricted Net Assets | 9 Months Ended |
Sep. 30, 2019 | |
Restricted Net Assets [Abstract] | |
RESTRICTED NET ASSETS | NOTE 15 – RESTRICTED NET ASSETS A portion of the Company's operations are conducted through its PRC subsidiaries, which can only pay dividends out of their retained earnings determined in accordance with the accounting standards and regulations in the PRC and after they have met the PRC requirements for appropriation to statutory reserve. In addition, a portion of the Company's businesses and assets are denominated in RMB, which is not freely convertible into foreign currencies. All foreign exchange transactions take place either through the People's Bank of China or other banks authorized to buy and sell foreign currencies at the exchange rates quoted by the People's Bank of China. Approval of foreign currency payments by the People's Bank of China or other regulatory institutions requires submitting a payment application form together with suppliers' invoices, shipping documents and signed contracts. These currency exchange control procedures imposed by the PRC government authorities may restrict the ability of the Company's PRC subsidiaries to transfer their net assets to the Parent Company through loans, advances or cash dividends. Schedule I of Article 5-04 of Regulation S-X requires the condensed financial information of the parent company to be filed when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year. For purposes of this test, restricted net assets of consolidated subsidiaries shall mean that amount of the registrant's proportionate share of net assets of its consolidated subsidiaries (after intercompany eliminations) which as of the end of the most recent fiscal year may not be transferred to the parent company in the form of loans, advances or cash dividends without the consent of a third party. The Company's PRC subsidiaries' net assets as of September 30, 2019 and December 31, 2018 did not exceed 25% of the Company's consolidated net assets. Accordingly, the Parent Company's condensed consolidated financial statements have not been required in accordance with Rule 5-04 and Rule 12-04 of SEC Regulation S-X. |
Commitments and Contincengies
Commitments and Contincengies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINCENGIES | NOTE 16 – COMMITMENTS AND CONTINCENGIES Operating Leases Beijing Genexosome Beijing Office Lease In March 2019, Beijing Genexosome signed an agreement to lease its office space under operating lease. Pursuant to the signed lease, the annual rent is RMB 7,000 (approximately $1,000). The term of this lease is one year commencing on March 15, 2019 and expires on March 14, 2020. For the three and nine months ended September 30, 2019, rent expense related to the lease amounted to $251and $552, respectively. Future minimum rental payment required under this operating lease is as follows: Year Ending September 30: 2020 $ 449 Avalon Shanghai Office Lease On January 19, 2017, Avalon Shanghai entered into a lease for office space in Beijing, China, with a third party (the "Beijing Office Lease"). Pursuant to the Beijing Office Lease, the monthly rent is RMB 50,586 (approximately $7,000) with a required security deposit of RMB 164,764 (approximately $23,000). In addition, Avalon Shanghai needs to pay monthly maintenance fees of RMB 4,336 (approximately $600). The term of the Beijing Office Lease is 26 months commencing on January 1, 2017 and expired on February 28, 2019 with two months of free rent in the months of December 2017 and February 2019. On December 27, 2018, Avalon Shanghai signed an extension for the lease with expiration date of February 29, 2020. For the three months ended September 30, 2019 and 2018, rent expense and maintenance fees related to the Beijing Office Lease amounted to approximately $26,000 and $20,000, respectively. For the nine months ended September 30, 2019 and 2018, rent expense and maintenance fees related to the Beijing Office Lease amounted to approximately $68,000 and $69,000, respectively. Future minimum rental payment required under the Beijing Office Lease is as follows: Year Ending September 30: 2020 $ 38,415 Insurance Premium Financing Agreement On July 9, 2019, the Company entered into a financing agreement, providing for the issuance of a loan in the principal amount of $206,172. The term of the loan is for a period of 12 months from the execution of the agreement. The annual interest rate for the loan is 6.29%. All of financed amount is used to pay for Directors & Officers Insurance premium. At September 30, 2019, the outstanding principal balance of the loan was $169,563, which was included in the accrued liabilities and other payables on the accompanying condensed consolidated balance sheets. Equity Investment Commitment On May 29, 2018, Avalon Shanghai entered into a Joint Venture Agreement with Jiangsu Unicorn Biological Technology Co., Ltd. ("Unicorn"), pursuant to which a company named Epicon Biotech Co., Ltd. ("Epicon") was formed on August 14, 2018. Epicon is owned 60% by Unicorn and 40% by Avalon Shanghai. Within two years of execution of the Joint Venture Agreement, Unicorn shall invest cash into Epicon in an amount not less than RMB 8,000,000 (approximately $1.1 million) and the premises of the laboratories of Nanjing Hospital of Chinese Medicine for exclusive use by Epicon, and Avalon Shanghai shall invest cash into Epicon in an amount not less than RMB 10,000,000 (approximately $1.4 million). Epicon is focused on cell preparation, third party testing, biological sample repository for commercial and scientific research purposes and the clinical transformation of scientific achievements. As of September 30, 2019, Avalon Shanghai has contributed RMB 3,800,000 (approximately $0.5 million) that was included in equity method investment on the accompanying condensed consolidated balance sheets. Avalon Shanghai intends to use its present working capital together with loans, borrowings, and equity raises to fund the project cost. Joint Venture – AVAR BioTherapeutics (China) Co. Ltd. On October 23, 2018, Avactis Biosciences, Inc. ("Avactis"), a wholly-owned subsidiary of the Company, and Arbele Limited ("Arbele") agreed to the establishment of AVAR BioTherapeutics (China) Co. Ltd. ("AVAR"), a Sino-foreign equity joint venture, pursuant to an Equity Joint Venture Agreement (the "AVAR Agreement"), which will be owned 60% by Avactis and 40% by Arbele. The purpose and business scope of the Joint Venture is to research, develop, produce, sell, distribute and generally commercialize CAR-T/CAR-NK/TCR-T/universal cellular immunotherapy in China. Avactis is required to contribute $10 million (or equivalent in RMB) in cash and/or services, which shall be contributed in tranches based on milestones to be determined jointly by AVAR and Avactis in writing subject to Avactis' cash reserves. Within 30 days, Arbele shall make a contribution of $6.66 million in the form of entering into a License Agreement with AVAR granting AVAR with an exclusive right and license in China to its technology and intellectual property pertaining to CAR-T/CAR-NK/TCR-T/universal cellular immunotherapy technology and any additional technology developed in the future with terms and conditions to be mutually agreed upon Avactis and AVAR and services. In addition, Avactis is responsible for: ● Contributing registered capital of RMB 5,000,000 (approximately $700,000) for working capital purposes as required by local regulation, which is not required to be contributed immediately and will be contributed subject to Avactis' discretion; ● assist AVAR in setting up its business operations and obtaining all required permits and licenses from the Chinese government; ● assisting AVAR in recruiting, hiring and retaining personnel; ● providing AVAR with access to various hospital networks in China to assist in the testing and commercialization of the CAR-T/CAR-NK/TCR-T/universal cellular immunotherapy technology in China; ● assisting AVAR in managing the Good Manufacturing Practices (GMP) facility and clinic to be developed by AVAR; ● providing AVAR with advice pertaining to conducting clinicals in China; and ● Within 6 days of signing the AVAR Agreement, Avactis is required to pay to Arbele $300,000 as a research and development fee with an additional two payments of $300,000 (for a total of $900,000) to be paid upon mutually agreed upon milestones. Under AVAR Agreement, Arbele shall be responsible for the following: ● Entering into a License Agreement with AVAR; and ● Providing AVAR with research and development expertise pertaining to clinical laboratory medicine when hired by AVAR. As of the date of this report, Avactis has paid $600,000 to Arbele as research and development fee, AVAR is in process of being established and the License Agreement has not been finalized. Line of Credit Agreement On August 29, 2019, the Company entered into a Line of Credit Agreement (the "Line of Credit Agreement") providing the Company with a $20 million line of credit (the "Line of Credit") from Wenzhao "Daniel" Lu (the "Lender"), a significant shareholder and director of the Company. The Line of Credit allows the Company to request loans thereunder and to use the proceeds of such loans for working capital and operating expense purposes until the facility matures on December 31, 2024. The loans are unsecured and are not convertible into equity of the Company. Loans drawn under the Line of Credit bears interest at an annual rate of 5% and each individual loan will be payable three years from the date of issuance. The Company has a right to draw down on the line of credit and not at the discretion of the related party Lender. The Company may, at its option, prepay any borrowings under the Line of Credit, in whole or in part at any time prior to maturity, without premium or penalty. The Line of Credit Agreement includes customary events of default. If any such event of default occurs, the Lender may declare all outstanding loans under the Line of Credit to be due and payable immediately. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 17 – SEGMENT INFORMATION For the three and nine months ended September 30, 2019 and 2018, the Company operated in three reportable business segments - (1) the real property operating segment, (2) the medical related consulting services segment, and (3) the performing development services for hospitals and other customers and sales of developed products to hospitals and other customers segment. The Company's reportable segments are strategic business units that offer different services and products. They are managed separately based on the fundamental differences in their operations. Information with respect to these reportable business segments for the three and nine months ended September 30, 2019 and 2018 was as follows: Three months Ended Nine Months Ended 2019 2018 2019 2018 Revenues Real property operating $ 264,141 $ 272,444 $ 795,656 $ 847,939 Medical related consulting services – related parties 108,520 71,398 234,214 213,394 Development services and sales of developed products 10,555 69,661 37,237 156,176 383,216 413,503 1,067,107 1,217,509 Depreciation and amortization Real property operating 41,121 32,624 122,682 97,873 Medical related consulting services 550 4,706 4,037 12,703 Development services and sales of developed products 103,248 98,298 303,320 273,027 144,919 135,628 430,039 383,603 Interest expense Real property operating - 25,205 32,877 287,123 Other (a) 11,198 - 27,423 - 11,198 25,205 60,300 287,123 Net loss Real property operating (3,190 ) 542 (105,569 ) (231,541 ) Medical related consulting services (200,832 ) (75,484 ) (445,529 ) (232,502 ) Development services and sales of developed products (1,163,250 ) (146,451 ) (1,641,438 ) (443,479 ) Other (a) (2,966,786 ) (2,181,858 ) (11,085,274 ) (4,390,513 ) $ (4,334,058 ) $ (2,403,251 ) $ (13,277,810 ) $ (5,298,035 ) Identifiable long-lived tangible assets at September 30, 2019 and December 31, 2018 September 30, December 31, Real property operating $ 7,791,863 $ 7,898,224 Medical related consulting services 270,177 6,852 Development services and sales of developed products 338,533 224,364 $ 8,400,573 $ 8,129,440 Identifiable long-lived tangible assets at September 30, 2019 and December 31, 2018 September 30, December 31, United States $ 7,885,775 $ 7,898,806 China 514,798 230,634 $ 8,400,573 $ 8,129,440 (a) The Company does not allocate any interest expense and general and administrative expense of its being a public company activities to its reportable segments as these activities are managed at a corporate level. |
Concentrations
Concentrations | 9 Months Ended |
Sep. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | NOTE 18 – CONCENTRATIONS Customers The following table sets forth information as to each customer that accounted for 10% or more of the Company's revenues for the three and nine months ended September 30, 2019 and 2018. Three Months Ended Nine Months Ended Customer 2019 2018 2019 2018 A (Beijing Daopei, a related party) * 17 % * 18 % B (Hebei Daopei, a related party) 28 % * 15 % * C 21 % 19 % 23 % 20 % D 14 % 13 % 15 % 13 % E 11 % 10 % 12 % 11 % * Less than 10% Two customers, whose outstanding receivable accounted for 10% or more of the Company's total outstanding accounts receivable and accounts receivable – related party and tenants receivable at September 30, 2019, accounted for 82.1% of the Company's total outstanding accounts receivable and accounts receivable – related party and tenants receivable at September 30, 2019. Two customers, whose outstanding receivable accounted for 10% or more of the Company's total outstanding accounts receivable and accounts receivable – related party and tenants receivable at December 31, 2018, accounted for 56.0% of the Company's total outstanding accounts receivable and accounts receivable – related party and tenants receivable at December 31, 2018. Suppliers No supplier accounted for 10% or more of the Company's purchase during the three and nine months ended September 30, 2019 and 2018. One supplier, whose outstanding payable accounted for 10% or more of the Company's total outstanding accounts payable at September 30, 2019, accounted for 87.9% of the Company's total outstanding accounts payable at September 30, 2019. One supplier, whose outstanding payable accounted for 10% or more of the Company's total outstanding accounts payable at December 31, 2018, accounted for 95.5% of the Company's total outstanding accounts payable at December 31, 2018. |
Reclassification
Reclassification | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
RECLASSIFICATION | NOTE 19 – RECLASSIFICATION During the three months ended June 30, 2019, the Company inadvertently estimated the fair value of the warrants using an incorrect assumption for volatility. The impact of the incorrect assumption was an understatement of the derivative liability and an overstatement of equity by approximately $700,000. The incorrect assumption had an immaterial impact on the Company’s statement of operations and cash flows. The Company’s June 30, 2019 balance sheet has been restated for the impact of this reclassification as follows: As Originally Reported As Reclassification Derivative liabilities $ 3,055,748 $ 3,755,748 Total liabilities $ 5,090,541 $ 5,790,541 Total Equity $ 8,542,198 $ 7,842,198 |
Subsequent Event
Subsequent Event | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENT | NOTE 20 – SUBSEQUENT EVENT As disclosed elsewhere, the Company entered into a Line of Credit Agreement (the "Line of Credit Agreement") providing the Company with a $20 million line of credit (the "Line of Credit") from Wenzhao "Daniel" Lu (the "Lender"), a significant shareholder and director of the Company. Under the Line of Credit, the Company received a loan from the Lender of $500,000 on October 23, 2019, $300,000 on October 24, 2019, and $800,000 on November 1, 2019. Loans drawn under the Line of Credit bear interest at an annual rate of 5% and each individual loan will be payable three years from the date of issuance. The Company may, at its option, prepay any borrowings under the Line of Credit, in whole or in part at any time prior to maturity, without premium or penalty. On October 18, 2019, the Company and third-party institutional investors (the ("Warrant Holders") holding Stock Purchase Warrants to acquire 1,714,288 shares of common stock of the Company (the "Warrants") entered into a Warrant Redemption and Cancellation Agreement (the "Redemption Agreement"). The Warrants had an exercise price of $3.50 per share and were originally issued as part of the Company's registered direct offering in April 2019. The Redemption Agreement provides that the Company will redeem the Warrants for a purchase price of approximately $1.4 million with 50% of the Warrants to be redeemed on or before October 25, 2019 and the balance to be redeemed on or before November 8, 2019. Following each closing, the Warrants that were redeemed shall be cancelled. The initial closing occurred on October 25, 2019 and the second closing occurred on November 6, 2019 resulting in all of the Warrants being redeemed and cancelled. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Use of Estimates | Use of Estimates The preparation of the unaudited condensed consolidated financial statements in conformity with generally accepted accounting principles in the United States of America 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 reporting period. Actual results could differ from these estimates. Significant estimates during the three and nine months ended September 30, 2019 and 2018 include the allowance for doubtful accounts, the useful life of property and equipment and investment in real estate, assumptions used in assessing impairment of long-term assets, valuation of deferred tax assets and the associated valuation allowances, and valuation of stock-based compensation. |
Fair Value of Financial Instruments and Fair Value Measurements | Fair Value of Financial Instruments and Fair Value Measurements The Company adopted the guidance of Accounting Standards Codification ("ASC") 820 for fair value measurements which clarifies the definition of fair value, prescribes methods for measuring fair value, and establishes a fair value hierarchy to classify the inputs used in measuring fair value as follows: ● Level 1-Inputs are unadjusted quoted prices in active markets for identical assets or liabilities available at the measurement date. ● Level 2-Inputs are unadjusted quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, inputs other than quoted prices that are observable, and inputs derived from or corroborated by observable market data. ● Level 3-Inputs are unobservable inputs which reflect the reporting entity's own assumptions on what assumptions the market participants would use in pricing the asset or liability based on the best available information. Assets and liabilities measured at fair value on a nonrecurring basis. Intangible assets. The following table provides the liabilities carried at fair value, measured as of September 30, 2019: Quoted Price in Active Markets Significant Other Observable Inputs Significant Balance at Derivative liabilities: Warrants $ - $ - $ 2,595,611 $ 2,595,611 The table below reflects the activity of derivative liabilities measured at fair value for the nine months ended September 30, 2019: Balance of derivative liabilities as of December 31, 2018 $ - Initial fair value of derivative liabilities attributable to warrants issuance with equity raise 4,217,241 Gain from change in the fair value of derivative liabilities (1,621,630 ) Balance of derivative liabilities as of September 30, 2019 $ 2,595,611 ASC 825-10 "Financial Instruments", allows entities to voluntarily choose to measure certain financial assets and liabilities at fair value (fair value option). The fair value option may be elected on an instrument-by-instrument basis and is irrevocable, unless a new election date occurs. If the fair value option is elected for an instrument, unrealized gains and losses for that instrument should be reported in earnings at each subsequent reporting date. The Company did not elect to apply the fair value option to any outstanding instruments. |
Concentrations of Credit Risk | Concentrations of Credit Risk Currently, a portion of the Company's operations are carried out in PRC. Accordingly, the Company's business, financial condition and results of operations may be influenced by the political, economic and legal environment in the PRC, and by the general state of the PRC's economy. The Company's operations in PRC are subject to specific considerations and significant risks not typically associated with companies in North America. The Company's results may be adversely affected by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion and remittance abroad, and rates and methods of taxation, among other things. Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash, trade accounts receivable and tenants receivable. A portion of the Company's cash is maintained with state-owned banks within the PRC, and none of these deposits are covered by insurance. The Company has not experienced any losses in such accounts and believes it is not exposed to any risks on its cash in bank accounts. A portion of the Company's sales are credit sales which is to the customer whose ability to pay is dependent upon the industry economics prevailing in these areas; however, concentrations of credit risk with respect to trade accounts receivable and tenants receivable is limited due to generally short payment terms. The Company also performs ongoing credit evaluations of its customers to help further reduce credit risk. At September 30, 2019 and December 31, 2018, the Company's cash balances by geographic area were as follows: Country: September 30, 2019 December 31, 2018 United States $ 563,078 52.5 % $ 1,035,802 46.0 % China 509,262 47.5 % 1,216,485 54.0 % Total cash $ 1,072,340 100.0 % $ 2,252,287 100.0 % |
Revenue Recognition | Revenue Recognition Effective January 1, 2018, the Company began recognizing revenue under Accounting Standards Codification ("ASC") Topic 606, Revenue from Contracts with Customers ("ASC 606"), using the modified retrospective transition method. The impact of adopting the new revenue standard was not material to the Company's consolidated financial statements and there was no adjustment to beginning accumulated deficit on January 1, 2018. The core principle of this new revenue standard is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle: ● Step 1: Identify the contract with the customer ● Step 2: Identify the performance obligations in the contract ● Step 3: Determine the transaction price ● Step 4: Allocate the transaction price to the performance obligations in the contract ● Step 5: Recognize revenue when the company satisfies a performance obligation In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised goods or service that is distinct. A performance obligation meets ASC 606's definition of a "distinct" goods or service (or bundle of goods or services) if both of the following criteria are met: ● The customer can benefit from the goods or service either on its own or together with other resources that are readily available to the customer (i.e., the goods or service is capable of being distinct). ● The entity's promise to transfer the goods or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the goods or service is distinct within the context of the contract). If a goods or service is not distinct, the goods or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer, excluding amounts collected on behalf of third parties (for example, some sales taxes). The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time as appropriate. Types of revenue: ● Service fees under consulting agreements with related parties to provide medical related consulting services to its clients. The Company is paid for its services by its clients pursuant to the terms of the written consulting agreements. Each contract calls for a fixed payment. ● Service fees under agreements to perform development services for hospitals and other customers. The Company does not perform contracts that are contingent upon successful results. ● Sales of developed products to hospitals and other customers. Revenue recognition criteria: ● The Company recognizes revenue by providing medical related consulting services under written service contracts with its customers. Revenue related to its service offerings is recognized as the services are performed. ● Revenue from development services performed under written contracts is recognized as services are provided. ● Revenue from sales of developed items to hospitals and other customers is recognized when items are shipped to customers and titles are transferred. The Company does not offer promotional payments, customer coupons, rebates or other cash redemption offers to its customers. |
Per Share Data | Per Share Data ASC Topic 260 "Earnings per Share," requires presentation of both basic and diluted earnings per share ("EPS") with a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation. Basic EPS excludes dilution. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. Basic net loss per share are computed by dividing net loss available to common stockholders by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock, common stock equivalents and potentially dilutive securities outstanding during each period. Potentially dilutive common shares consist of the common shares issuable upon the exercise of common stock options and warrants (using the treasury stock method). Common stock equivalents are not included in the calculation of diluted net loss per share if their effect would be anti-dilutive. In a period in which the Company has a net loss, all potentially dilutive securities are excluded from the computation of diluted shares outstanding as they would have had an anti-dilutive impact. The following table summarizes the securities that were excluded from the diluted per share calculation because the effect of including these potential shares was antidilutive: Three Months Ended Nine Months Ended 2019 2018 2019 2018 Stock options 5,070,000 2,670,000 5,070,000 2,670,000 Warrants 1,714,288 578,891 1,714,288 578,891 Potentially dilutive securities 6,784,288 3,248,891 6,784,288 3,248,891 |
Reclassification | Reclassification Certain prior period amounts have been reclassified to conform to the current period presentation. These reclassifications have no effect on the previously reported financial position, results of operations and cash flows. |
Recent Accounting Standards | Recent Accounting Standards In February 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-02, "Leases" ("ASU 842"), The Company adopted ASU 842 effective January 1, 2019 using the optional transition method of recognizing a cumulative-effect adjustment to the opening balance of accumulated deficit on January 1, 2019. Therefore, comparative financial information was not adjusted and continues to be reported under the prior lease accounting guidance in ASU 840. The Company elected the transition relief package of practical expedients, and as a result, the Company did not assess 1) whether existing or expired contracts contain embedded leases, 2) lease classification for any existing or expired leases, and 3) whether lease origination costs qualified as initial direct costs. The Company elected the short-term lease practical expedient by establishing an accounting policy to exclude leases with a term of 12 months or less. In July 2017, the FASB issued Accounting Standards Update No. 2017-11, Accounting for Certain Financial Instruments with Down Round Features On June 20, 2018, the FASB issued ASU 2018-07, which simplifies the accounting for share-based payments granted to nonemployees for goods and services. Under the ASU, most of the guidance on such payments to nonemployees would be aligned with the requirements for share-based payments granted to employees. For public business entities (PBEs), the amendments in ASU 2018-07 are effective for fiscal years beginning after December 15, 2018, including interim periods therein. Early adoption is permitted if financial statements have not yet been issued (for PBEs), but no earlier than an entity's adoption date of ASC 606. If early adoption is elected, all amendments in the ASU that apply must be adopted in the same period. In addition, if early adoption is elected in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes that interim period. The Company has adopted the ASU 2018-07 in 2019 and it did not have a material impact on the Company's condensed consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement Other accounting standards that have been issued or proposed by FASB that do not require adoption until a future date are not expected to have a material impact on the consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures. |
Organization and Nature of Op_2
Organization and Nature of Operations (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of company's subsidiaries consolidated financial statements | Name of Subsidiaries Place and date of Incorporation Percentage of Ownership Principal Activities Avalon Healthcare System, Inc. (“AHS”) Delaware May 18, 2015 100% held by AVCO Provides medical related consulting services and developing Avalon Cell and Avalon Rehab in United States of America (“USA”) Avalon (BVI) Ltd. (“Avalon BVI”) British Virgin Island January 23, 2017 100% held by AVCO Dormant, is in process of being dissolved Avalon RT 9 Properties LLC (“Avalon RT 9”) New Jersey February 7, 2017 100% held by AVCO Owns and operates an income-producing real property and holds and manages the corporate headquarters Avalon (Shanghai) Healthcare Technology Co., Ltd. (“Avalon Shanghai”) PRC April 29, 2016 100% held by AHS Provides medical related consulting services and developing Avalon Cell and Avalon Rehab in China Genexosome Technologies Inc. (“Genexosome”) Nevada July 31, 2017 60% held by AVCO Develops proprietary diagnostic and therapeutic products using exosomes Beijing Jieteng (Genexosome) Biotech Co., Ltd. (“Beijing Genexosome”) PRC August 7, 2015 100% held by Genexosome Provides development services for hospitals and other customers and sells developed items to hospitals and other customers in China Avactis Biosciences Inc. (“Avactis”) Nevada July 18, 2018 100% held by AVCO Integrate and optimize global scientific and clinical resources to further advance cellular therapies, including regenerative medicine with stem/progenitor cells as well as cellular immunotherapy including CAR-T, CAR-NK, TCR-T and others to treat certain cancers International Exosome Association LLC (“Exosome”) Delaware June 13, 2019 100% held by AVCO Promotes standardization related to exosome industry |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Schedule of liabilities carried at fair value, measured | Quoted Price in Active Markets Significant Other Observable Inputs Significant Balance at Derivative liabilities: Warrants $ - $ - $ 2,595,611 $ 2,595,611 |
Schedule of derivative liabilities measured at fair value | Balance of derivative liabilities as of December 31, 2018 $ - Initial fair value of derivative liabilities attributable to warrants issuance with equity raise 4,217,241 Gain from change in the fair value of derivative liabilities (1,621,630 ) Balance of derivative liabilities as of September 30, 2019 $ 2,595,611 |
Schedule of cash balances by geographic area | Country: September 30, 2019 December 31, 2018 United States $ 563,078 52.5 % $ 1,035,802 46.0 % China 509,262 47.5 % 1,216,485 54.0 % Total cash $ 1,072,340 100.0 % $ 2,252,287 100.0 % |
Schedule of the effect of including these potential shares was antidilutive | Three Months Ended Nine Months Ended 2019 2018 2019 2018 Stock options 5,070,000 2,670,000 5,070,000 2,670,000 Warrants 1,714,288 578,891 1,714,288 578,891 Potentially dilutive securities 6,784,288 3,248,891 6,784,288 3,248,891 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepaid expenses and other current assets | September 30, December 31, Prepaid professional fees $ 195,785 $ 607,833 Prepaid research and development service fees - 300,000 Prepaid insurance expense 137,376 72,352 Prepaid dues and subscriptions 41,916 70,000 Other 100,036 109,284 $ 475,113 $ 1,159,469 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property and equipment | Useful life September 30, December 31, Laboratory equipment 5 Years $ 690,296 $ 258,345 Office equipment and furniture 3 – 10 Years 39,285 35,627 Leasehold improvement Shorter of useful life or lease term - 24,446 729,581 318,418 Less: accumulated depreciation (104,989 ) (68,863 ) $ 624,592 $ 249,555 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of intangible assets | Useful Life September 30, December 31, Patents and other technologies 5 Years $ 1,583,260 $ 1,583,260 Less: accumulated amortization (573,249 ) (327,571 ) Less: impairment loss (1,010,011 ) - $ - $ 1,255,689 |
Equity Method Investment (Table
Equity Method Investment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of equity method investment | Equity investment carrying value at December 31, 2018 $ 385,162 Epicon's net loss attributable to the Company (48,353 ) Payment made for equity method investment 116,545 Foreign currency fluctuation (17,254 ) Equity investment carrying value at September 30, 2019 $ 436,100 |
Schedule of financial information | September 30, December 31, Current assets $ 51,666 $ 301,714 Noncurrent assets 241,541 7,015 Current liabilities 336 38 Noncurrent liabilities - - Equity 292,871 308,691 For the Three Months Ended For the Nine Months Ended Net revenue $ - $ - Gross profit - - Loss from operation 63,165 120,882 Net loss 63,165 120,882 |
Accrued Liabilities and Other_2
Accrued Liabilities and Other Payables (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Payables and Accruals [Abstract] | |
Schedule of accrued liabilities and other payables | September 30, December 31, Accrued payroll liability $ 2,402 $ 529,472 Accrued professional fees 778,090 166,077 Accrued research and development fee 225,000 - Insurance payable 169,563 45,088 Accrued directors' compensation 107,500 17,500 Accounts payable 84,887 6,695 Interest payable - 75,342 Other 136,217 120,017 $ 1,503,659 $ 960,191 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Schedule of revenue from related parties | Three Months Ended Nine Months Ended 2019 2018 2019 2018 Medical related consulting services provided to: Beijing Daopei (1) $ - $ 71,398 $ 55,908 $ 213,394 Shanghai Daopei (2) - - 14,180 - Hebei Daopei (3) 108,520 - 164,126 - $ 108,520 $ 71,398 $ 234,214 $ 213,394 (1) Beijing Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. (2) Shanghai Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. (3) Hebei Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Schedule of stock options outstanding | Options Outstanding Options Exercisable Range of Number Outstanding at September 30, Range of Weighted Average Remaining Contractual Life (Years) Weighted Average Exercise Price Number Exercisable at September 30, 2019 Weighted Average Exercise $ 0.50 2,000,000 7.36 $ 0.50 1,777,778 $ 0.50 1.00 – 1.49 450,000 1.09 – 3.09 1.07 450,000 1.07 2.00 – 2.80 2,560,000 2.58 – 4.26 2.15 1,922,500 2.15 4.76 60,000 4.52 4.76 40,000 4.76 $ 0.50 – 4.76 5,070,000 5.20 $ 1.43 4,190,278 $ 1.36 |
Schedule of stock option activities | Number of Options Weighted Average Exercise Price Outstanding at December 31, 2018 2,840,000 $ 0.76 Granted 2,430,000 2.18 Terminated / Exercised (200,000 ) 1.00 Outstanding at September 30, 2019 5,070,000 $ 1.43 Options exercisable at September 30, 2019 4,190,278 $ 1.36 Options expected to vest 879,722 $ 1.79 |
Schedule of fair value of the options using the Black-Scholes option-pricing model | Number of Options Weighted Average Exercise Price Nonvested at December 31, 2018 915,555 $ 0.62 Granted 2,430,000 2.18 Vested (2,465,833 ) (1.74 ) Nonvested at September 30, 2019 879,722 $ 1.79 |
Schedule of stock warrants activities | Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding at September 30, Remaining Contractual Life (Years) Number Exercisable at September 30, Exercise Price $ 3.50 1,714,288 4.57 1,714,288 $ 3.50 |
Schedule of warrants outstanding and exercisable | Number of Warrants Weighted Average Exercise Price Outstanding at December 31, 2018 578,891 $ 1.28 Issued 1,714,288 3.50 Exercised (578,891 ) (1.28 ) Outstanding and exercisable at September 30, 2019 1,714,288 $ 3.50 |
Noncontrolling Interest (Tables
Noncontrolling Interest (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Noncontrolling Interest [Abstract] | |
Summary of noncontrolling interest activities | Noncontrolling interest at December 31, 2018 $ (862,200 ) Net loss attributable to noncontrolling interest (656,575 ) Foreign currency translation adjustment attributable to noncontrolling interest 5,154 Noncontrolling interest at September 30, 2019 $ (1,513,621 ) |
Commitments and Contincengies (
Commitments and Contincengies (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Beijing Genexosome Beijing Office Lease [Member] | |
Schedule of future minimum rental payment for operating lease | Year Ending September 30: 2020 $ 449 |
Avalon Shanghai Office Lease [Member] | |
Schedule of future minimum rental payment for operating lease | Year Ending September 30: 2020 $ 38,415 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Schedule of segment reporting information | Three months Ended Nine Months Ended 2019 2018 2019 2018 Revenues Real property operating $ 264,141 $ 272,444 $ 795,656 $ 847,939 Medical related consulting services – related parties 108,520 71,398 234,214 213,394 Development services and sales of developed products 10,555 69,661 37,237 156,176 383,216 413,503 1,067,107 1,217,509 Depreciation and amortization Real property operating 41,121 32,624 122,682 97,873 Medical related consulting services 550 4,706 4,037 12,703 Development services and sales of developed products 103,248 98,298 303,320 273,027 144,919 135,628 430,039 383,603 Interest expense Real property operating - 25,205 32,877 287,123 Other (a) 11,198 - 27,423 - 11,198 25,205 60,300 287,123 Net loss Real property operating (3,190 ) 542 (105,569 ) (231,541 ) Medical related consulting services (200,832 ) (75,484 ) (445,529 ) (232,502 ) Development services and sales of developed products (1,163,250 ) (146,451 ) (1,641,438 ) (443,479 ) Other (a) (2,966,786 ) (2,181,858 ) (11,085,274 ) (4,390,513 ) $ (4,334,058 ) $ (2,403,251 ) $ (13,277,810 ) $ (5,298,035 ) Identifiable long-lived tangible assets at September 30, 2019 and December 31, 2018 September 30, December 31, Real property operating $ 7,791,863 $ 7,898,224 Medical related consulting services 270,177 6,852 Development services and sales of developed products 338,533 224,364 $ 8,400,573 $ 8,129,440 Identifiable long-lived tangible assets at September 30, 2019 and December 31, 2018 September 30, December 31, United States $ 7,885,775 $ 7,898,806 China 514,798 230,634 $ 8,400,573 $ 8,129,440 (a) The Company does not allocate any interest expense and general and administrative expense of its being a public company activities to its reportable segments as these activities are managed at a corporate level. |
Concentrations (Tables)
Concentrations (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Schedule of customers | Three Months Ended Nine Months Ended Customer 2019 2018 2019 2018 A (Beijing Daopei, a related party) * 17 % * 18 % B (Hebei Daopei, a related party) 28 % * 15 % * C 21 % 19 % 23 % 20 % D 14 % 13 % 15 % 13 % E 11 % 10 % 12 % 11 % * Less than 10% |
Reclassification (Tables)
Reclassification (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Schedule of reclassification | As Originally Reported As Reclassification Derivative liabilities $ 3,055,748 $ 3,755,748 Total liabilities $ 5,090,541 $ 5,790,541 Total Equity $ 8,542,198 $ 7,842,198 |
Organization and Nature of Op_3
Organization and Nature of Operations (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Organization and Nature of Operations (Textual) | |
Percentage of Ownership | 40.00% |
Avalon Healthcare System, Inc. (“AHS”) [Member] | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | Delaware |
Date of Incorporation | May 18, 2015 |
Percentage of Ownership | 100.00% |
Principal Activities | Provides medical related consulting services and developing Avalon Cell and Avalon Rehab in United States of America ("USA") |
Avalon (BVI) Ltd. (“Avalon BVI”) [Member] | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | British Virgin Island |
Date of Incorporation | Jan. 23, 2017 |
Percentage of Ownership | 100.00% |
Principal Activities | Dormant, is in process of being dissolved |
Avalon RT 9 Properties LLC (“Avalon RT 9”) [Member] | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | New Jersey |
Date of Incorporation | Feb. 7, 2017 |
Percentage of Ownership | 100.00% |
Principal Activities | Owns and operates an income-producing real property and holds and manages the corporate headquarters |
Avalon (Shanghai) Healthcare Technology Co., Ltd. (“Avalon Shanghai”) [Member] | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | PRC |
Date of Incorporation | Apr. 29, 2016 |
Percentage of Ownership | 100.00% |
Principal Activities | Provides medical related consulting services and developing Avalon Cell and Avalon Rehab in China |
Genexosome Technologies Inc. (“Genexosome”) [Member] | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | Nevada |
Date of Incorporation | Jul. 31, 2017 |
Percentage of Ownership | 60.00% |
Principal Activities | Develops proprietary diagnostic and therapeutic products using exosomes |
Beijing Jieteng (Genexosome) Biotech Co., Ltd. Biotech Co., Ltd. [Member] | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | PRC |
Date of Incorporation | Aug. 7, 2015 |
Percentage of Ownership | 100.00% |
Principal Activities | Provides development services for hospitals and other customers and sells developed items to hospitals and other customers in China |
Avactis Biosciences Inc. (''Avactis'') | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | Nevada |
Date of Incorporation | Jul. 18, 2018 |
Percentage of Ownership | 100.00% |
Principal Activities | Integrate and optimize global scientific and clinical resources to further advance cellular therapies, including regenerative medicine with stem/progenitor cells as well as cellular immunotherapy including CAR-T, CAR-NK, TCR-T and others to treat certain cancers |
International Exosome Association LLC (''Exosome") | |
Organization and Nature of Operations (Textual) | |
Place of Incorporation | Delaware |
Date of Incorporation | Jun. 13, 2019 |
Percentage of Ownership | 100.00% |
Principal Activities | Promotes standardization related to exosome industry |
Organization and Nature of Op_4
Organization and Nature of Operations (Details Textual) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Oct. 25, 2017 | Oct. 19, 2016 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Organization and Nature of Operations (Textual) | ||||||
Ownership percentage | 40.00% | 40.00% | ||||
Impairment loss | $ 1,010,011 | $ 1,010,011 | ||||
Avalon Healthcare System, Inc. [Member] | ||||||
Organization and Nature of Operations (Textual) | ||||||
Business acquired percentage | 100.00% | |||||
Exchange for common stock | 50,000,000 | |||||
Percentage of capital stock | 100.00% | |||||
Ownership percentage | 100.00% | 100.00% | ||||
GenExosome Technologies Inc. [Member] | ||||||
Organization and Nature of Operations (Textual) | ||||||
Acquired shares | 600 | |||||
Consideration amount | $ 1,326,087 | |||||
Common stock shares | 500,000 | |||||
Ownership percentage | 60.00% | 60.00% | ||||
Consideration of cash payment amount | $ 450,000 | |||||
GenExosome Technologies Inc. [Member] | Asset Purchase Agreement [Member] | ||||||
Organization and Nature of Operations (Textual) | ||||||
Ownership percentage | 60.00% | |||||
Dr. Zhou [Member] | ||||||
Organization and Nature of Operations (Textual) | ||||||
Consideration amount | $ 876,087 | |||||
Common stock shares | 500,000 | |||||
Ownership percentage | 40.00% | |||||
Common stock issued | 400 |
Basis of Presentation and Liq_2
Basis of Presentation and Liquidity and Financial Condition (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Cash | $ 1,100,000 | $ 1,100,000 | |||
Working Capital | 2,500,000 | 2,500,000 | |||
Accumulated deficit | (23,913,011) | (23,913,011) | $ (11,291,776) | ||
Loss From operation | (5,476,347) | $ (2,379,418) | (14,285,412) | $ (4,907,391) | |
Net cash used in operating activities | (5,318,165) | $ (3,540,696) | |||
Line of Credit Agreement [Member] | |||||
Line of credit | $ 20,000,000 | $ 20,000,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) | Sep. 30, 2019USD ($) |
Derivative liabilities: Warrants [Member] | |
Derivative liabilities: Warrants | $ 2,595,611 |
Quoted Price in Active Markets (Level 1) [Member] | |
Derivative liabilities: Warrants | |
Significant Other Observable Inputs (Level 2) [Member] | Derivative liabilities: Warrants [Member] | |
Derivative liabilities: Warrants | |
Significant Unobservable Inputs (Level 3) [Member] | Derivative liabilities: Warrants [Member] | |
Derivative liabilities: Warrants | $ 2,595,611 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Accounting Policies [Abstract] | |
Balance of derivative liabilities as of December 31, 2018 | |
Initial fair value of derivative liabilities attributable to warrants issuance with equity raise | 4,217,241 |
Gain from change in the fair value of derivative liabilities | (1,621,630) |
Balance of derivative liabilities as of September 30, 2019 | $ 2,595,611 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 2) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Percentage of concentrations of credit risk | 10.00% | 10.00% | |
Cash [Member] | |||
Total cash | $ 1,072,340 | $ 1,072,340 | $ 2,252,287 |
Percentage of concentrations of credit risk | 100.00% | 100.00% | |
United States [Member] | Cash [Member] | |||
Total cash | 563,078 | $ 563,078 | $ 1,035,802 |
Percentage of concentrations of credit risk | 52.50% | 46.00% | |
China [Member] | Cash [Member] | |||
Total cash | $ 509,262 | $ 509,262 | $ 1,216,485 |
Percentage of concentrations of credit risk | 47.50% | 54.00% |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details 3) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Potentially dilutive securities | 6,784,288 | 3,248,891 | 6,784,288 | 3,248,891 |
Stock options [Member] | ||||
Potentially dilutive securities | 5,070,000 | 2,670,000 | 5,070,000 | 2,670,000 |
Warrants [Member] | ||||
Potentially dilutive securities | 1,714,288 | 578,891 | 1,714,288 | 578,891 |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies (Details Textual) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Significant Unobservable Inputs (Level 3) [Member] | ||
Significant Accounting Policies (Textual) | ||
Impairment of intangible assets | $ 1,010,011 | $ 0 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid professional fees | $ 195,785 | $ 607,833 |
Prepaid research and development service fees | 300,000 | |
Prepaid insurance expense | 137,376 | 72,352 |
Prepaid dues and subscriptions | 41,916 | 70,000 |
Other | 100,036 | 109,284 |
Total prepaid expenses and other | $ 475,113 | $ 1,159,469 |
Property and Equipment (Details
Property and Equipment (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment, Gross | $ 729,581 | $ 318,418 |
Less: accumulated depreciation | (104,989) | (68,863) |
Property, Plant and Equipment, Net | 624,592 | 249,555 |
Laboratory equipment [Member] | ||
Property, Plant and Equipment, Gross | $ 690,296 | $ 258,345 |
Useful life | 5 years | 5 years |
Office equipment and furniture [Member] | ||
Property, Plant and Equipment, Gross | $ 39,285 | $ 35,627 |
Office equipment and furniture [Member] | Minimum [Member] | ||
Useful life | 3 years | 3 years |
Office equipment and furniture [Member] | Maximum [Member] | ||
Useful life | 10 years | 10 years |
Leasehold improvement [Member] | ||
Property, Plant and Equipment, Gross | $ 24,446 | |
Useful lives | Shorter of useful life or lease term | Shorter of useful life or lease term |
Property and Equipment (Detai_2
Property and Equipment (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Property and Equipment (Textual) | ||||
Depreciation expense | $ 23,351 | $ 21,931 | $ 64,136 | $ 42,509 |
Real Property Operating Expense [Member] | ||||
Property and Equipment (Textual) | ||||
Depreciation expense | 820 | 819 | 2,457 | 2,457 |
Cost of Development Services and Sales of Developed Products [Member] | ||||
Property and Equipment (Textual) | ||||
Depreciation expense | 16,871 | 16,220 | 47,356 | 25,852 |
Other Operating Expense [Member] | ||||
Property and Equipment (Textual) | ||||
Depreciation expense | 633 | 4,892 | 5,078 | 14,200 |
Research and Development Expense [Member] | ||||
Property and Equipment (Textual) | ||||
Depreciation expense | $ 5,027 | $ 0 | $ 9,245 | $ 0 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Useful Life of patents and other technologies | 5 years | |
Patents and other technologies | $ 1,583,260 | $ 1,583,260 |
Less: accumulated amortization | (573,249) | (327,571) |
Less: impairment loss | (1,010,011) | |
Intangible assets net | $ 1,255,689 |
Intangible Assets (Details Text
Intangible Assets (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 81,892 | $ 81,892 | $ 245,678 | $ 245,678 |
Impairment loss | $ 1,010,011 | $ 1,010,011 |
Equity Method Investment (Detai
Equity Method Investment (Details) | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity investment carrying value at December 31, 2018 | $ 385,162 |
Epicon's net loss attributable to the Company | (48,353) |
Payment made for equity method investment | 116,545 |
Foreign currency fluctuation | (17,254) |
Equity investment carrying value at September 30, 2019 | $ 436,100 |
Equity Method Investment (Det_2
Equity Method Investment (Details 1) - USD ($) | 3 Months Ended | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 | |
Equity Method Investment Financial Information [Abstract] | |||
Current assets | $ 51,666 | $ 51,666 | $ 301,714 |
Noncurrent assets | 241,541 | 241,541 | 7,015 |
Current liabilities | 336 | 336 | 38 |
Noncurrent liabilities | |||
Equity | 292,871 | 292,871 | $ 308,691 |
Net revenue | |||
Gross profit | |||
Loss from operation | 63,165 | 120,882 | |
Net loss | $ 63,165 | $ 120,882 |
Equity Method Investment (Det_3
Equity Method Investment (Details Textual) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Equity Method Investment (Textual) | |||||
Equity method investment amounted | $ 436,100 | $ 436,100 | $ 385,162 | ||
Total ownership percentage | 40.00% | 40.00% | |||
Net loss | $ 25,266 | $ 48,353 | |||
Jiangsu Unicorn Biological Technology Co., Ltd. [Member] | |||||
Equity Method Investment (Textual) | |||||
Total ownership percentage | 60.00% | 60.00% | |||
Other Unrelated Company [Member] | |||||
Equity Method Investment (Textual) | |||||
Total ownership percentage | 40.00% | 40.00% |
Accrued Liabilities and Other_3
Accrued Liabilities and Other Payables (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Payables and Accruals [Abstract] | ||
Accrued payroll liability | $ 2,402 | $ 529,472 |
Accrued professional fees | 778,090 | 166,077 |
Accrued research and development fee | 225,000 | |
Insurance payable | 169,563 | 45,088 |
Accrued directors' compensation | 107,500 | 17,500 |
Accounts payable | 84,887 | 6,695 |
Interest payable | 75,342 | |
Other | 136,217 | 120,017 |
Total accounts payable and accrued liabilities | $ 1,503,659 | $ 960,191 |
Loan Payable (Details)
Loan Payable (Details) - USD ($) | 1 Months Ended | ||||
Apr. 30, 2019 | Apr. 30, 2018 | Nov. 30, 2017 | Apr. 19, 2017 | Sep. 30, 2019 | |
Loan Payable (Textual) | |||||
Loan principal amount | $ 2,100,000 | ||||
Maturity date | On May 3, 2018, the Company signed an extension agreement with a maturity date of March 31, 2019. On August 3, 2018, the Company signed an extension agreement for the loan with a maturity date of March 31, 2020. | ||||
Term | 1 year | ||||
Annual interest rate | 10.00% | ||||
Repayment of loan | $ 1,000,000 | $ 500,000 | $ 600,000 | ||
Outstanding principal balance | $ 0 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Medical related consulting services | $ 108,520 | $ 71,398 | $ 234,214 | $ 213,394 | |
Beijing Daopei [Member] | |||||
Medical related consulting services | [1] | 71,398 | 55,908 | 213,394 | |
Shanghai Daopei [Member] | |||||
Medical related consulting services | [2] | 14,180 | |||
Hebei Daopei [Member] | |||||
Medical related consulting services | [3] | $ 108,520 | $ 164,126 | ||
[1] | Beijing Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. | ||||
[2] | Shanghai Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. | ||||
[3] | Hebei Daopei is a subsidiary of an entity whose chairman is Wenzhao Lu, the major shareholder of the Company. |
Related Party Transactions (D_2
Related Party Transactions (Details Textual) - USD ($) | Mar. 18, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Accounts receivable - related parties, net of allowance for doubtful accounts | $ 167,870 | $ 167,870 | ||||
Allowance for doubtful accounts | 167,870 | 167,870 | 0 | |||
Property management agreement amounted | 0 | $ 16,251 | 23,334 | $ 48,753 | ||
Outstanding principal balance | $ 590,000 | 590,000 | ||||
Accrued interest | $ 23,425 | |||||
Ownership of percentage | 40.00% | 40.00% | ||||
Interest related to note payable - related party amount | $ 23,425 | $ 23,425 | 0 | |||
Interest expense related amount | 8,842 | 23,425 | ||||
Principal repaid amount | 410,000 | |||||
David Jin [Member] | ||||||
Prepaid expenses - related parties | 0 | 0 | 1,897 | |||
David Jin [Member] | Chief Executive Officer [Member] | ||||||
Accrued liabilities and other payables | 31,267 | 31,267 | 0 | |||
Meng Li [Member] | ||||||
Prepaid expenses - related parties | 0 | 0 | 32,293 | |||
Beijing Daopei [Member] | ||||||
Advance from customer - related party | $ 0 | 0 | 14,829 | |||
GenExosome [Member] | ||||||
Genexosome for Cash payment | $ 450,000 | |||||
Ownership of percentage | 40.00% | 40.00% | ||||
Yu Zhou [Member] | ||||||
Due to related party | $ 100,000 | $ 100,000 | $ 100,000 | |||
Wenzhao Lu [Member] | ||||||
Property management agreement commenced date | May 5, 2017 | |||||
Agreement expired date | Mar. 31, 2019 | |||||
Outstanding principal balance | $ 1,000,000 | |||||
Promissory Note interest percentage | 5.00% | |||||
Promissory note maturity date | Mar. 19, 2022 |
Derivative Liabilities (Details
Derivative Liabilities (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||
Apr. 25, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Derivative Liabilities (Textual) | ||||
Warrant issued | 1,714,288 | |||
Fair value of warrants liability | $ 2,595,611 | $ (1,621,630) | ||
Stock price | $ 2.82 | |||
Volatility rate | 142.55% | |||
Risk free rate | 2.33% | |||
Annual dividend | 0.00% | |||
Expected life | 5 years | |||
Investor warrants | $ 2,595,611 | |||
Derivative [Member] | ||||
Derivative Liabilities (Textual) | ||||
Stock price | $ 1.87 | |||
Volatility rate | 135.00% | |||
Risk free rate | 1.55% | |||
Annual dividend | 0.00% | |||
Expected life | 4 years 6 months 25 days | |||
Investor warrants | $ 1,895,611 | |||
Derivative [Member] | Minimum [Member] | ||||
Derivative Liabilities (Textual) | ||||
Fair value of warrants liability | 1,160,137 | |||
Derivative [Member] | Maximum [Member] | ||||
Derivative Liabilities (Textual) | ||||
Fair value of warrants liability | $ 1,621,630 |
Equity (Details)
Equity (Details) - Options [Member] | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Number options Exercisable | shares | 4,190,278 |
Weighted Average options Exercise Price | $ / shares | $ 1.36 |
0.50 [Member] | |
Number of options outstanding | shares | 2,000,000 |
Range of Weighted Average Remaining Contractual Life (Years) | 7 years 4 months 9 days |
Weighted Average Exercise Price | $ / shares | $ 0.50 |
Number options Exercisable | shares | 1,777,778 |
Weighted Average options Exercise Price | $ / shares | $ 0.50 |
4.76 [Member] | |
Number of options outstanding | shares | 60,000 |
Range of Weighted Average Remaining Contractual Life (Years) | 4 years 6 months 7 days |
Weighted Average Exercise Price | $ / shares | $ 4.76 |
Number options Exercisable | shares | 40,000 |
Weighted Average options Exercise Price | $ / shares | $ 4.76 |
1.00 - 1.49 [Member] | |
Number of options outstanding | shares | 450,000 |
Weighted Average Exercise Price | $ / shares | $ 1.07 |
Number options Exercisable | shares | 450,000 |
Weighted Average options Exercise Price | $ / shares | $ 1.07 |
1.00 - 1.49 [Member] | Minimum [Member] | |
Range of Weighted Average Remaining Contractual Life (Years) | 1 year 1 month 2 days |
1.00 - 1.49 [Member] | Maximum [Member] | |
Range of Weighted Average Remaining Contractual Life (Years) | 3 years 1 month 2 days |
2.00 - 2.80 [Member] | |
Number of options outstanding | shares | 2,560,000 |
Weighted Average Exercise Price | $ / shares | $ 2.15 |
Number options Exercisable | shares | 1,922,500 |
Weighted Average options Exercise Price | $ / shares | $ 2.15 |
2.00 - 2.80 [Member] | Minimum [Member] | |
Range of Weighted Average Remaining Contractual Life (Years) | 2 years 6 months 29 days |
2.00 - 2.80 [Member] | Maximum [Member] | |
Range of Weighted Average Remaining Contractual Life (Years) | 4 years 3 months 4 days |
0.50 - 4.76 [Member] | |
Number of options outstanding | shares | 5,070,000 |
Range of Weighted Average Remaining Contractual Life (Years) | 5 years 2 months 12 days |
Weighted Average Exercise Price | $ / shares | $ 1.43 |
Number options Exercisable | shares | 4,190,278 |
Weighted Average options Exercise Price | $ / shares | $ 1.36 |
Equity (Details 1)
Equity (Details 1) - Stock options [Member] - $ / shares | 9 Months Ended |
Sep. 30, 2019 | |
Number of Options | |
Balance at beginning balance | 2,840,000 |
Granted | 2,430,000 |
Terminated / Exercised | (200,000) |
Balance at ending balance | 5,070,000 |
Option Exercisable at end | 4,190,278 |
Options expected to vest | 879,722 |
Weighted Average Exercise Price | |
Balance at beginning balance | $ 0.76 |
Granted | 2.18 |
Terminated / Exercised | 1 |
Balance at end | 1.43 |
Option Exercisable at ending balance | 1.36 |
Options expected to vest | $ 1.79 |
Equity (Details 2)
Equity (Details 2) - Nonvested Stock Options [Member] | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Number of Options | |
Nonvested at beginning balance | shares | 915,555 |
Granted | shares | 2,430,000 |
Vested | shares | (2,465,833) |
Nonvested at ending balance | shares | 879,722 |
Weighted Average Exercise Price | |
Nonvested at beginning balance | $ / shares | $ 0.62 |
Granted | $ / shares | 2.18 |
Vested | $ / shares | (1.74) |
Nonvested at ending balance | $ / shares | $ 1.79 |
Equity (Details 3)
Equity (Details 3) - Warrant [Member] | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Number of Warrants | |
Outstanding at beginning balance | shares | 1,714,288 |
Issued | shares | 1,714,288 |
Exercised | shares | (578,891) |
Outstanding at ending balance | shares | 578,891 |
Weighted Average Exercise Price | |
Outstanding at beginning balance | $ / shares | $ 3.50 |
Issued | $ / shares | 3.50 |
Exercised | $ / shares | (1.28) |
Outstanding at ending balance | $ / shares | $ 1.28 |
Equity (Details 4)
Equity (Details 4) - Warrant [Member] - $ / shares | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Warrants Outstanding, Exercise Price | $ 1.28 | $ 3.50 |
Number of warrants Outstanding | 578,891 | 1,714,288 |
Warrants Outstanding, Remaining Contractual Life (Years) | 4 years 6 months 25 days | |
Number of Warrants Exercisable | 1,714,288 | |
Warrants Exercisable, Exercise Price | $ 3.50 |
Equity (Details Textual)
Equity (Details Textual) - USD ($) | Jan. 09, 2019 | Sep. 23, 2019 | Apr. 30, 2019 | Apr. 25, 2019 | Apr. 25, 2019 | Feb. 27, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Equity (Textual) | |||||||||||
Preferred stock, authorized | 10,000,000 | 10,000,000 | 10,000,000 | ||||||||
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Common stock, authorized | 490,000,000 | 490,000,000 | 490,000,000 | ||||||||
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||||
Preferred stock, issued | |||||||||||
Preferred stock, outstanding | |||||||||||
Common stock, issued | 76,291,056 | 76,291,056 | 73,830,751 | ||||||||
Common stock, outstanding | 75,771,056 | 75,771,056 | 73,310,751 | ||||||||
Warrants to purchase shares of common stock | 578,891 | ||||||||||
Stock-based compensation expense | $ 7,003,077 | $ 2,224,969 | |||||||||
Aggregate intrinsic value of the warrants exercisable | $ 0 | 0 | |||||||||
Shares of common stock upon cashless exercise | 200,000 | ||||||||||
Fair value of warrants liability | $ 2,595,611 | (1,621,630) | |||||||||
Investor warrants | $ 2,595,611 | 2,595,611 | |||||||||
Common stock issued | 350,856 | 158,932 | |||||||||
Fair market shares values | $ 391,867 | ||||||||||
Fair value of the options granted | $ 5,713,079 | $ 1,633,254 | |||||||||
Option [Member] | |||||||||||
Equity (Textual) | |||||||||||
Fair values of options granted, description | The fair values of options granted during the nine months ended September 30, 2019 were estimated at the date of grant using the Black-Scholes option-pricing model with the following assumptions: volatility of 149.75% - 151.70%, risk-free rate of 2.28% - 2.49%, annual dividend yield of 0% and expected life of 3.00 ? 5.00 years. | ||||||||||
intrinsic values of stock options outstanding | $ 3,102,100 | ||||||||||
Stock options exercisable | 2,797,656 | ||||||||||
Fair value of the options granted | $ 6,338,844 | ||||||||||
Additional Paid-In Capital | |||||||||||
Equity (Textual) | |||||||||||
Stock-based compensation | 1,916,193 | 612,081 | |||||||||
Common Stock | Non Employee Stock Option [Member] | |||||||||||
Equity (Textual) | |||||||||||
Aggregate fair value of options granted | $ 481,341 | ||||||||||
Aggregate fair value of options granted per share | $ 3.50 | ||||||||||
Common stock granted price | 3.50 | ||||||||||
Investor [Member] | |||||||||||
Equity (Textual) | |||||||||||
Description of purchage agreements | The Company entered into a purchase agreement with several third party institutional investors for the purchase of 1,714,288 units in a registered direct offering, for gross proceeds of $6,000,008 before placement agent fees and other offering expenses payable by the Company. Each unit was sold at a public offering price of $3.50 and consists of one share of common stock and a warrant to purchase one share of common stock. The Company received net cash proceeds of $5,103,704, net of cash paid for placement agent fees and other offering expenses. | ||||||||||
Consultants [Member] | |||||||||||
Equity (Textual) | |||||||||||
Common stock issued | 115,417 | 120,812 | |||||||||
Stock-based compensation | 313,800 | ||||||||||
Warrant [Member] | |||||||||||
Equity (Textual) | |||||||||||
Warrants exercise price | $ 1.28 | $ 1.28 | $ 3.50 | ||||||||
Number of warrants Outstanding | 578,891 | 578,891 | 1,714,288 | ||||||||
Warrants Outstanding, Remaining Contractual Life (Years) | 4 years 6 months 25 days |
Statutory Reserve (Details)
Statutory Reserve (Details) | 9 Months Ended |
Sep. 30, 2019 | |
Statutory Reserve (Textual) | |
Statutory reserve percentage | 10.00% |
Statutory reserve appropriation, description | The appropriation is required until the statutory reserve reaches 50% of the registered capital. |
Noncontrolling Interest (Detail
Noncontrolling Interest (Details) | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Noncontrolling Interest [Abstract] | |
Noncontrolling interest at Beginning | $ (862,200) |
Net loss attributable to noncontrolling interest | (656,575) |
Foreign currency translation adjustment attributable to noncontrolling interest | 5,154 |
Noncontrolling interest at ending | $ (1,513,621) |
Noncontrolling Interest (Deta_2
Noncontrolling Interest (Details Textual) | Sep. 30, 2019 |
Noncontrolling Interest (Textual) | |
Equity interests ownership percentage | 40.00% |
GenExsome [Member] | Dr. Yu Zhou [Member] | |
Noncontrolling Interest (Textual) | |
Equity interests ownership percentage | 40.00% |
Restricted Net Assets (Details)
Restricted Net Assets (Details) | Sep. 30, 2019 | Dec. 31, 2018 |
Restricted Net Assets (Textual) | ||
Net assets | 25.00% | 25.00% |
Commitments and Contincengies_2
Commitments and Contincengies (Details) | Sep. 30, 2019USD ($) |
Beijing GenExosome Office Lease [Member] | |
Year Ending September 30: | |
2020 | $ 449 |
Avalon Shanghai Office Lease [Member] | |
Year Ending September 30: | |
2020 | $ 38,415 |
Commitments and Contincengies_3
Commitments and Contincengies (Details Textual) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||||
Aug. 29, 2019USD ($) | Oct. 23, 2018USD ($) | May 29, 2018 | Jan. 19, 2017USD ($) | Jan. 19, 2017CNY (¥) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019CNY (¥) | Sep. 30, 2018USD ($) | Jul. 09, 2019USD ($) | Oct. 23, 2018CNY (¥) | |
Commitments and Contincengies (Textual) | ||||||||||||
Rent expense | $ 26,000 | $ 20,000 | $ 68,000 | $ 69,000 | ||||||||
Joint venture agreement, description | Within 6 days of signing the AVAR Agreement, Avactis is required to pay to Arbele $300,000 as a research and development fee with an additional two payments of $300,000 (for a total of $900,000) to be paid upon mutually agreed upon milestones. | |||||||||||
Working capital | 2,500,000 | 2,500,000 | ||||||||||
Research and development fee | 265,139 | $ 1,384 | 1,367,310 | $ 1,647 | ||||||||
Avalon Shanghai [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Joint venture agreement, description | Avalon Shanghai entered into a Joint Venture Agreement with Jiangsu Unicorn Biological Technology Co., Ltd. ("Unicorn"), pursuant to which a company named Epicon Biotech Co., Ltd. ("Epicon") was formed on August 14, 2018. Epicon is owned 60% by Unicorn and 40% by Avalon Shanghai. Within two years of execution of the Joint Venture Agreement, Unicorn shall invest cash into Epicon in an amount not less than RMB 8,000,000 (approximately $1.1 million) and the premises of the laboratories of Nanjing Hospital of Chinese Medicine for exclusive use by Epicon, and Avalon Shanghai shall invest cash into Epicon in an amount not less than RMB 10,000,000 (approximately $1.4 million). Epicon is focused on cell preparation, third party testing, biological sample repository for commercial and scientific research purposes and the clinical transformation of scientific achievements. As of September 30, 2019, Avalon Shanghai has contributed RMB 3,800,000 (approximately $0.5 million) that was included in equity method investment on the accompanying condensed consolidated balance sheets. | |||||||||||
AVAR BioTherapeutics (China) Co. Ltd. [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Joint venture agreement, description | Avactis Biosciences, Inc. ("Avactis"), a wholly-owned subsidiary of the Company, and Arbele Limited ("Arbele") agreed to the establishment of AVAR BioTherapeutics (China) Co. Ltd. ("AVAR"), a Sino-foreign equity joint venture, pursuant to an Equity Joint Venture Agreement (the "AVAR Agreement"), which will be owned 60% by Avactis and 40% by Arbele. The purpose and business scope of the Joint Venture is to research, develop, produce, sell, distribute and generally commercialize CAR-T/CAR-NK/TCR-T/universal cellular immunotherapy in China. Avactis is required to contribute $10 million (or equivalent in RMB) in cash and/or services, which shall be contributed in tranches based on milestones to be determined jointly by AVAR and Avactis in writing subject to Avactis' cash reserves. Within 30 days, Arbele shall make a contribution of $6.66 million in the form of entering into a License Agreement with AVAR granting AVAR with an exclusive right and license in China to its technology and intellectual property pertaining to CAR-T/CAR-NK/TCR-T/universal cellular immunotherapy technology and any additional technology developed in the future with terms and conditions to be mutually agreed upon Avactis and AVAR and services. | |||||||||||
Working capital | $ 700,000 | |||||||||||
Research and development fee | $ 600,000 | |||||||||||
Insurance Premium Financing Agreement [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Principal amount | $ 206,172 | |||||||||||
Annual interest rate | 6.29% | |||||||||||
Outstanding principal balance | 169,563 | $ 169,563 | ||||||||||
Line of Credit Agreement [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Line of credit | $ 20,000,000 | |||||||||||
Line of facility mature date | Dec. 31, 2024 | |||||||||||
Line of Credit bears interest at an annual rate | 5.00% | |||||||||||
CNY [Member] | AVAR BioTherapeutics (China) Co. Ltd. [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Working capital | ¥ | ¥ 5,000,000 | |||||||||||
Beijing Genexosome Office Lease [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Expiration period | Mar. 14, 2020 | Mar. 14, 2020 | ||||||||||
Lease, annual rent | $ 1,000 | |||||||||||
Rent expense | $ 251 | $ 552 | ||||||||||
Beijing Genexosome Office Lease [Member] | CNY [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Lease, annual rent | ¥ | ¥ 7,000 | |||||||||||
Avalon Shanghai Office Lease [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Lease, monthly rent | $ 7,000 | |||||||||||
Security deposit | 23,000 | |||||||||||
Operating lease maintenance fees | $ 600 | |||||||||||
Avalon Shanghai Office Lease [Member] | CNY [Member] | ||||||||||||
Commitments and Contincengies (Textual) | ||||||||||||
Expiration period | Feb. 29, 2020 | Feb. 29, 2020 | ||||||||||
Lease, monthly rent | ¥ | ¥ 50,586 | |||||||||||
Security deposit | ¥ | 164,764 | |||||||||||
Operating lease maintenance fees | ¥ | ¥ 4,336 |
Segment Information (Details)
Segment Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | ||
Revenues | $ 383,216 | $ 413,503 | $ 1,067,107 | $ 1,217,509 | ||
Depreciation and amortization | 144,919 | 135,628 | 430,039 | 383,603 | ||
Interest expense | 11,198 | 25,205 | 60,300 | 287,123 | ||
Net loss | (4,334,058) | (2,403,251) | (13,277,810) | (5,298,035) | ||
Identifiable long-lived tangible assets | 8,400,573 | 8,400,573 | $ 8,129,440 | |||
Real property operating [Member] | ||||||
Revenues | 264,141 | 272,444 | 795,656 | 847,939 | ||
Depreciation and amortization | 41,121 | 32,624 | 122,682 | 97,873 | ||
Interest expense | 25,205 | 32,877 | 287,123 | |||
Net loss | (3,190) | 542 | (105,569) | (231,541) | ||
Identifiable long-lived tangible assets | 7,791,863 | 7,791,863 | 7,898,224 | |||
Medical related consulting services-related parties [Member] | ||||||
Revenues | 108,520 | 71,398 | 234,214 | 213,394 | ||
Depreciation and amortization | 550 | 4,706 | 4,037 | 12,703 | ||
Net loss | (200,832) | (75,484) | (445,529) | (232,502) | ||
Identifiable long-lived tangible assets | 270,177 | 270,177 | 6,852 | |||
Development services and sales of developed products [Member] | ||||||
Revenues | 10,555 | 69,661 | 37,237 | 156,176 | ||
Depreciation and amortization | 103,248 | 98,298 | 303,320 | 273,027 | ||
Net loss | (1,163,250) | (146,451) | (1,641,438) | (443,479) | ||
Identifiable long-lived tangible assets | 338,533 | 338,533 | $ 224,364 | |||
Other [Member] | ||||||
Interest expense | [1] | 11,198 | 27,423 | |||
Net loss | [1] | $ (2,966,786) | $ (2,181,858) | $ (11,085,274) | $ (4,390,513) | |
[1] | The Company does not allocate any interest expense and general and administrative expense of its being a public company activities to its reportable segments as these activities are managed at a corporate level. |
Segment Information (Details 1)
Segment Information (Details 1) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Identifiable long-lived tangible assets | $ 8,400,573 | $ 8,129,440 |
United States [Member] | ||
Identifiable long-lived tangible assets | 7,885,775 | 7,898,806 |
China [Member] | ||
Identifiable long-lived tangible assets | $ 514,798 | $ 230,634 |
Segment Information (Details Te
Segment Information (Details Textual) - Segment | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
Segment Information (Textual) | ||
Number of reportable business segments | 3 | 3 |
Concentrations (Details)
Concentrations (Details) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |||||
Customer | 10.00% | 10.00% | ||||||
A [Member] | More than 10% Revenues [Member] | ||||||||
Customer | [1] | 17.00% | [1] | 18.00% | ||||
B [Member | More than 10% Revenues [Member] | ||||||||
Customer | 28.00% | [1] | 15.00% | [1] | ||||
C [Member] | More than 10% Revenues [Member] | ||||||||
Customer | 21.00% | 19.00% | 23.00% | 20.00% | ||||
D [Member] | More than 10% Revenues [Member] | ||||||||
Customer | 14.00% | 13.00% | 15.00% | 13.00% | ||||
E [Member] | More than 10% Revenues [Member] | ||||||||
Customer | 11.00% | 10.00% | 12.00% | 11.00% | ||||
[1] | Less than 10% |
Concentrations (Details Textual
Concentrations (Details Textual) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019Customer / IntegerSupplier / Integer | Dec. 31, 2018Customer / IntegerSupplier / Integer | |
Concentrations (Textual) | |||
Concentration risk, percentage | 10.00% | 10.00% | |
10% or more of purchase [Member] | Outstanding accounts payable [Member] | |||
Concentrations (Textual) | |||
Concentration risk, percentage | 87.90% | 95.50% | |
Number of supplier | Supplier / Integer | 1 | 1 | |
More than 10% Revenues [Member] | Outstanding accounts and tenants receivable [Member] | |||
Concentrations (Textual) | |||
Concentration risk, percentage | 82.10% | 56.00% | |
Number of customer | Customer / Integer | 2 | 2 |
Reclassification (Details)
Reclassification (Details) | Jun. 30, 2019USD ($) |
Derivative liabilities | $ 3,055,748 |
Total liabilities | 5,090,541 |
Total Equity | 8,542,198 |
As Reclassification [Member] | |
Derivative liabilities | 3,755,748 |
Total liabilities | 5,790,541 |
Total Equity | $ 7,842,198 |
Reclassification (Details Textu
Reclassification (Details Textual) | 9 Months Ended |
Sep. 30, 2019 | |
Reclassification Abstract | |
Reclassification, description | The impact of the incorrect assumption was an understatement of the derivative liability and an overstatement of equity by approximately $700,000. |
Subsequent Event (Details)
Subsequent Event (Details) - Subsequent Event [Member] - USD ($) | 1 Months Ended | |||
Nov. 01, 2019 | Oct. 24, 2019 | Oct. 23, 2019 | Oct. 18, 2019 | |
Warrant Holders [Member] | ||||
Subsequent Event (Textual) | ||||
Warrants acquire to purchase of common stock | 1,714,288 | |||
Warrants exercise price | $ 3.50 | |||
Warrants redemption related, description | The Redemption Agreement provides that the Company will redeem the Warrants for a purchase price of approximately $1.4 million with 50% of the Warrants to be redeemed on or before October 25, 2019 and the balance to be redeemed on or before November 8, 2019. Following each closing, the Warrants that were redeemed shall be cancelled. The initial closing occurred on October 25, 2019 and the second closing occurred on November 6, 2019 resulting in all of the Warrants being redeemed and cancelled. | |||
Line of Credit [Member] | ||||
Subsequent Event (Textual) | ||||
Line of credit | $ 800,000 | $ 300,000 | $ 500,000 | |
Annual rate | 5.00% | 5.00% | 5.00% |