Cover
Cover - shares | 3 Months Ended | |
Dec. 31, 2020 | Feb. 05, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | CEL-SCI CORPORATION | |
Entity Central Index Key | 0000725363 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Current Fiscal Year End Date | --09-30 | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Document Period End Date | Dec. 31, 2020 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 | |
Entity Common Stock Shares Outstanding | 40,529,278 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-11889 | |
Entity Incorporation State Country Code | CO | |
Entity Tax Identification Number | 84-0916344 | |
Entity Address Address Line 1 | 8229 Boone Boulevard | |
Entity Address Address Line 2 | Suite 802 | |
Entity Address City Or Town | Vienna | |
Entity Address State Or Province | VA | |
Entity Address Postal Zip Code | 22182 | |
City Area Code | 703 | |
Local Phone Number | 506-9460 | |
Security 12b Title | Common Stock | |
Trading Symbol | CVM | |
Security Exchange Name | NYSE | |
Entity Interactive Data Current | Yes |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
Current Assets: | ||
Cash and cash equivalents | $ 21,860,482 | $ 15,508,909 |
Receivables | 54,922 | 54,922 |
Prepaid expenses | 629,894 | 1,313,432 |
Supplies used for R&D and manufacturing | 1,152,837 | 820,052 |
Total current assets | 23,698,135 | 17,697,315 |
Finance lease right of use assets | 13,382,401 | 13,811,849 |
Operating lease right of use assets | 1,160,305 | 1,198,958 |
Property and equipment, net | 9,401,891 | 5,843,993 |
Patent costs, net | 300,356 | 313,422 |
Deposits | 1,670,917 | 1,670,917 |
Total Assets | 49,614,005 | 40,536,454 |
Current Liabilities: | ||
Accounts payable | 3,092,856 | 2,023,067 |
Accrued expenses | 616,163 | 510,515 |
Due to employees | 458,740 | 448,022 |
Derivative instruments, current portion | 2,040,773 | 213,787 |
Lease liabilities, current portion | 1,125,337 | 1,070,123 |
Total current liabilities | 7,333,869 | 4,265,514 |
Derivative instruments, net of current portion | 750,154 | 3,551,826 |
Finance lease obligations, net of current portion | 11,495,840 | 11,753,100 |
Operating lease obligations, net of current portion | 1,073,470 | 1,114,340 |
Other liabilities | 125,000 | 125,000 |
Total liabilities | 20,778,333 | 20,809,780 |
Commitments and Contingencies | 0 | 0 |
STOCKHOLDERS' EQUITY | ||
Preferred stock, $.01 par value-200,000 shares authorized; -0- shares issued and outstanding | 0 | 0 |
Common stock, $.01 par value - 600,000,000 shares authorized; 39,767,058 and 38,730,150 shares issued and outstanding at December 31, 2020 and September 30, 2020, respectively | 397,671 | 387,302 |
Additional paid-in capital | 418,210,168 | 401,174,675 |
Accumulated deficit | (389,772,167) | (381,835,303) |
Total stockholders' equity | 28,835,672 | 19,726,674 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 49,614,005 | $ 40,536,454 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2020 | Sep. 30, 2020 |
CONDENSED BALANCE SHEETS | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 200,000 | 200,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 600,000,000 | 600,000,000 |
Common stock, shares issued | 39,767,058 | 38,730,150 |
Common stock, shares outstanding | 39,767,058 | 38,730,150 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) | ||
Grant income | $ 0 | $ 35,506 |
Operating Expenses: | ||
Research and development | 5,414,760 | 4,252,813 |
General and administrative | 3,316,156 | 2,638,896 |
Total operating expenses | 8,730,916 | 6,891,709 |
Operating loss | (8,730,916) | (6,856,203) |
Other income | 0 | 18,448 |
Gain on derivative instruments | 932,836 | 766,509 |
Other non-operating gains | 121,606 | 790,669 |
Interest expense, net | (260,390) | (250,783) |
Net loss | (7,936,864) | (5,531,360) |
Modification of warrants | (85,779) | 0 |
Net loss available to common shareholders | $ (8,022,643) | $ (5,531,360) |
Net loss per common share | ||
BASIC | $ (0.21) | $ (0.16) |
DILUTED | $ (0.21) | $ (0.16) |
Weighted average common shares outstanding | ||
BASIC | 38,670,247 | 35,084,279 |
DILUTED | 38,767,286 | 35,098,608 |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
Balance, shares at Sep. 30, 2019 | 35,231,776 | |||
Balance, amount at Sep. 30, 2019 | $ 5,133,667 | $ 352,318 | $ 358,507,603 | $ (353,726,254) |
Adoption of new accounting standard | 2,146,195 | 2,146,195 | ||
Issuance of common stock, shares | 606,395 | |||
Issuance of common stock, amount | 5,050,003 | $ 6,064 | 5,043,939 | 0 |
Warrant exercises, shares | 132,900 | |||
Warrant exercises, amount | 297,101 | $ 1,329 | 295,772 | 0 |
Equity based compensation - employees, amount | 1,800,225 | $ 0 | 1,800,225 | 0 |
401(k) contributions paid in common stock, shares | 4,474 | |||
401(k) contributions paid in common stock, amount | 40,937 | $ 45 | 40,892 | 0 |
Stock issued to nonemployees for service, shares | 15,819 | |||
Stock issued to nonemployees for service, amount | 84,447 | $ 158 | 84,289 | 0 |
Purchase of stock by officer, shares | 3,725 | |||
Purchase of stock by officer, amount | 25,000 | $ 37 | 24,963 | 0 |
Share issuance costs | (92,150) | 0 | (92,150) | 0 |
Net loss | (5,531,360) | $ 0 | 0 | (5,531,360) |
Balance, shares at Dec. 31, 2019 | 35,995,089 | |||
Balance, amount at Dec. 31, 2019 | 8,954,065 | $ 359,951 | 365,705,533 | (357,111,419) |
Balance, shares at Sep. 30, 2020 | 38,730,150 | |||
Balance, amount at Sep. 30, 2020 | 19,726,674 | $ 387,302 | 401,174,675 | (381,835,303) |
Warrant exercises, shares | 15,000 | |||
Warrant exercises, amount | 89,250 | $ 150 | 89,100 | 0 |
Equity based compensation - employees, amount | 3,296,309 | $ (20) | 3,296,329 | 0 |
401(k) contributions paid in common stock, shares | 3,564 | |||
401(k) contributions paid in common stock, amount | 41,671 | $ 36 | 41,635 | 0 |
Stock issued to nonemployees for service, shares | 15,044 | |||
Stock issued to nonemployees for service, amount | 152,450 | $ 150 | 152,300 | 0 |
Share issuance costs | (117,021) | 0 | (117,021) | 0 |
Net loss | (7,936,864) | $ 0 | 0 | (7,936,864) |
Proceeds from the sale of common stock, shares | 1,000,000 | |||
Proceeds from the sale of common stock, amount | $ 13,559,500 | $ 10,000 | 13,549,500 | 0 |
Equity based compensation - employees, shares | (2,000) | |||
Option exercises, shares | 5,300 | 5,300 | ||
Option exercises, amount | $ 23,511 | $ 53 | 23,458 | 0 |
Modification of warrants | 192 | $ 0 | 192 | 0 |
Balance, shares at Dec. 31, 2020 | 39,767,058 | |||
Balance, amount at Dec. 31, 2020 | $ 28,835,672 | $ 397,671 | $ 418,210,168 | $ (389,772,167) |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) | ||
Net loss | $ (7,936,864) | $ (5,531,360) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 550,682 | 502,540 |
Share-based payments for services | 248,660 | 155,740 |
Equity based compensation | 3,296,309 | 1,800,225 |
Common stock contributed to 401(k) plan | 41,671 | 40,937 |
Gain on derivative instruments | (932,836) | (766,509) |
Modification of warrants | 192 | 0 |
(Increase)/decrease in assets: | ||
Receivables | 532,328 | (28,278) |
Prepaid expenses | (332,785) | 86,567 |
Supplies used for R&D and manufacturing | 0 | (123,512) |
Increase/(decrease) in liabilities: | ||
Accounts payable | 532,679 | (393,064) |
Accrued expenses | 143,028 | 80,432 |
Due to employees | 10,718 | 76,520 |
Other liabilities | 18,319 | (1,914) |
Net cash used in operating activities | (3,827,899) | (4,101,676) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Purchases of property and equipment | (3,149,820) | (101,820) |
Proceeds from the sale of equipment | 0 | 4,500 |
Expenditures for patent costs | 0 | (12,390) |
Net cash used in investing activities | (3,149,820) | (109,710) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock | 13,559,500 | 5,050,003 |
Payments of stock issuance costs | (79,499) | (31,080) |
Proceeds from the purchase of stock by officer | 0 | 25,000 |
Proceeds from exercises of warrants and options | 70,911 | 297,101 |
Payments on obligations under finance lease | (221,620) | (191,034) |
Net cash provided by financing activities | 13,329,292 | 5,149,990 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 6,351,573 | 938,604 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 15,508,909 | 8,444,774 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 21,860,482 | 9,383,378 |
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Property and equipment included in current liabilities | 1,700,969 | 296,941 |
Capitalizable patent costs included in current liabilities | 15,000 | 0 |
Finance lease obligation included in accounts payable | 1,752 | 745 |
Prepaid consulting services paid with issuance of common stock | 243,687 | (71,293) |
Exercise of derivative liabilities | 41,850 | 0 |
Financing costs included in current liabilities | 88,021 | 76,650 |
Cash paid for interest | $ 277,618 | $ 295,107 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Dec. 31, 2020 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
A. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | A. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying condensed financial statements of CEL-SCI Corporation (the Company) are unaudited and certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission. While management of the Company believes that the disclosures presented are adequate to make the information presented not misleading, these interim condensed financial statements should be read in conjunction with the financial statements and notes included in the Company’s annual report on Form 10-K for the year ended September 30, 2020. In the opinion of management, the accompanying unaudited condensed financial statements contain all adjustments necessary for a fair presentation of the Company’s financial position as of December 31, 2020 and the results of its operations for the three months then ended. The condensed balance sheet as of September 30, 2020 is derived from the September 30, 2020 audited financial statements. The financial statements have been prepared assuming that the Company will continue as a going concern, but due to recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Refer to discussion in Note B. Summary of Significant Accounting Policies: Property and Equipment Patents Research and Development Costs Leases - Income Taxes Derivative Instruments Stock-Based Compensation The Company has Incentive Stock Option Plans, Non-Qualified Stock Option Plans, Stock Compensation Plans, Stock Bonus Plans and an Incentive Stock Bonus Plan. In some cases, these Plans are collectively referred to as the "Plans". All Plans have been approved by the stockholders. The Company’s stock options are not transferable, and the actual value of the stock options that an employee may realize, if any, will depend on the excess of the market price on the date of exercise over the exercise price. The Company has based its assumption for stock price volatility on the variance of daily closing prices of the Company’s common stock. The risk-free interest rate assumption was based on the U.S. Treasury rate at date of the grant with term equal to the expected life of the option. Forfeitures are accounted for when they occur. The expected term of options represents the period that options granted are expected to be outstanding and has been determined based on an analysis of historical exercise behavior. If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation expense for new awards may differ materially in the future from that recorded in the current period. Vesting of restricted stock granted under the Incentive Stock Bonus Plan and options granted under the 2020 Non-Qualified Stock Option Plan are subject to service, performance and market conditions and meet the classification of equity awards. These awards were measured at market value on the grant-dates for issuances where the attainment of performance criteria is likely and at fair value on the grant-dates, using a Monte Carlo simulation for issuances where the attainment of performance criteria is uncertain. The total compensation cost will be expensed over the estimated requisite service period. Newly Adopted Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement - Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (Topic ).” New Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes The Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements. |
OPERATIONS AND FINANCING
OPERATIONS AND FINANCING | 3 Months Ended |
Dec. 31, 2020 | |
OPERATIONS AND FINANCING | |
B. OPERATIONS AND FINANCING | B. OPERATIONS AND FINANCING On May 4, 2020, the Company announced that the pivotal Phase 3 head and neck cancer study of Multikine immunotherapy had reached the targeted threshold of 298 events (deaths) required to conduct the data evaluation. Database lock has been completed and the Phase 3 study is now in the final statistical analysis phase. The Company will continue to remain blinded to the study results throughout this process. The Company will be advised of the results when the analysis is completed, and the study results will be announced to the public at that time. The Company has incurred significant costs since its inception for the acquisition of certain proprietary technology and scientific knowledge relating to the human immunological defense system, patent applications, research and development, administrative costs, construction of laboratory facilities and participation in clinical trials. The Company has funded such costs primarily with proceeds from loans and the public and private sale of its securities. The Company will be required to raise additional capital or find additional long-term financing to continue with its research efforts. The ability to raise capital may be dependent upon market conditions that are outside the control of the Company. The ability of the Company to complete the necessary clinical trials and obtain FDA approval for the sale of products to be developed on a commercial basis is uncertain. Ultimately, the Company must complete the development of its products, obtain the appropriate regulatory approvals and obtain sufficient revenues to support its cost structure. The Company believes there is a high likelihood that it will continue to receive funds from private and public offerings and warrant exercises similar to the way it has substantially funded operations for the past 12 months. However, there can be no assurance that the Company will be able to raise sufficient capital to support its operations. To finance the Company through marketing approval, the Company plans to raise additional capital in the form of warrant exercises, corporate partnerships, and debt and/or equity financings. The Company believes that it will be able to obtain additional financing because it has done so consistently in the past and because the Multikine Phase 3 study has ended and is only awaiting final data readout. However, there can be no assurance that the Company will be successful in raising additional funds on a timely basis or that the funds will be available to the Company on acceptable terms or at all. If the Company does not raise the necessary amounts of money, it may have to curtail its operations until such time as it is able to raise the required funding. Impact of COVID-19 Pandemic In response to the global outbreak of COVID-19 and the World Health Organization’s classification of the outbreak as a pandemic, the Company continues to take the necessary precautions to ensure the safety of its employees and to minimize interruptions to its operations. Management follows the Centers for Disease Control and Prevention’s (“CDC”) guidance and the recommendations and restrictions provided by state and local authorities. The full impact of the COVID-19 outbreak continues to evolve as of the date of this report. As such, it is uncertain as to the full magnitude of impact the pandemic will have on the Company’s financial condition, liquidity and future results of operations. Management is actively monitoring the risks to public health and the impact of overall global business activity on its financial condition, liquidity, operations, suppliers, industry, and workforce. The financial statements have been prepared assuming the Company will continue as a going concern, but due to the Company’s recurring losses from operations and future liquidity needs, there is substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. |
STOCKHOLDERS EQUITY
STOCKHOLDERS EQUITY | 3 Months Ended |
Dec. 31, 2020 | |
STOCKHOLDERS EQUITY | |
C. STOCKHOLDERS' EQUITY | C. STOCKHOLDERS’ EQUITY Proceeds from the Sale of Common Stock In December 2020, the Company sold 1,000,000 shares of common stock at a public offering price of $14.65 per share and received aggregate proceeds of approximately $13.6 million. Under the terms of the Underwriting Agreement the Company granted the Underwriters a 30-day option to purchase up to an additional 150,000 shares of common stock at the public offering price to cover over-allotments. Equity Compensation Underlying share information for equity compensation plans as of December 31, 2020 is as follows: Name of Plan Total Shares Reserved Shares Reserved for Outstanding Options Shares Remaining Options/Shares Under Plans Incentive Stock Options Plans 138,400 85,895 N/A 213 Non-Qualified Stock Option Plans 9,987,200 8,527,787 N/A 1,201,832 Stock Bonus Plans 783,760 N/A 348,660 435,067 Stock Compensation Plans 634,000 N/A 150,695 464,895 Incentive Stock Bonus Plan 640,000 N/A 614,500 25,500 Underlying share information for equity compensation plans as of September 30, 2020 is as follows: Name of Plan Total Shares Reserved Shares Reserved for Outstanding Options Shares Remaining Options/Shares Under Plans Incentive Stock Option Plans 138,400 85,895 N/A 213 Non-Qualified Stock Option Plans 9,987,200 8,567,808 N/A 1,167,166 Stock Bonus Plans 783,760 N/A 345,096 438,631 Stock Compensation Plans 634,000 N/A 150,695 464,895 Incentive Stock Bonus Plan 640,000 N/A 616,500 23,500 Stock option activity: Three Months Ended December 31, 2020 2019 Options granted 7,500 1,000 Options exercised 5,300 - Options forfeited 42,166 - Options expired 55 36 Stock-Based Compensation Expense Three months Ended December 31, 2020 2019 Employees $ 3,296,309 $ 1,800,225 Non-employees $ 248,660 $ 155,740 Employee compensation expense includes the expense related to options and restricted stock granted expensed over their vesting periods. Non-employee expense includes the expense related to options and stock issued to consultants expensed over the period of the related service contracts. Warrants and Non-Employee Options The following chart represents the warrants and non-employee options outstanding at December 31, 2020: Warrant/Options Issue Date Shares Issuable upon Exercise of Warrants/ Options Exercise Price Expiration Date Reference Series N 8/18/2008 85,339 $ 3.00 8/18/2021 2 Series UU 6/11/2018 93,603 $ 2.80 6/30/2021 2 Series X 1/13/2016 120,000 $ 9.25 7/13/2021 2 Series Y 2/15/2016 26,000 $ 12.00 8/15/2021 2 Series ZZ 5/23/2016 20,000 $ 13.75 5/18/2021 * Series BB 8/26/2016 16,000 $ 13.75 8/22/2021 * Series Z 5/23/2016 264,000 $ 13.75 11/23/2021 * Series FF 12/8/2016 68,048 $ 3.91 12/1/2021 * Series CC 12/8/2016 143,643 $ 5.00 12/8/2021 1 Series HH 2/23/2017 200 $ 3.13 2/16/2022 * Series AA 8/26/2016 200,000 $ 13.75 2/22/2022 * Series MM 6/22/2017 797,633 $ 1.86 6/22/2022 * Series NN 7/24/2017 348,842 $ 2.52 7/24/2022 * Series RR 10/30/2017 417,649 $ 1.65 10/30/2022 * Series SS 12/19/2017 326,064 $ 2.09 12/18/2022 * Series TT 2/5/2018 361,564 $ 2.24 2/5/2023 2 Consultants 7/28/2017 - 11/18/2020 15,000 $ 2.18-11.61 11/17/2022 - 7/27/2027 3 * No current period changes to these warrants 1. Derivative Liabilities The table below presents the fair value of the warrant liabilities at the balance sheet dates: December 31, 2020 September 30, 2020 Series W warrants $ - $ 73,570 Series Z warrants 929,539 1,207,902 Series ZZ warrants 23,177 75,044 Series AA warrants 748,404 1,082,212 Series BB warrants 34,541 65,173 Series CC warrants 1,053,517 1,259,712 Series HH warrants 1,749 2,000 Total warrant liabilities $ 2,790,927 $ 3,765,613 The table below presents the gains and (losses) on the warrant liabilities for the three months ended December 31: 2020 2019 Series V warrants $ - $ 555,031 Series W warrants 73,570 151,374 Series Z warrants 278,363 10,549 Series ZZ warrants 51,867 14,847 Series AA warrants 333,808 64,978 Series BB warrants 30,632 (431 ) Series CC warrants 164,345 (22,681 ) Series FF warrants - (7,189 ) Series HH warrants 251 (82 ) Series JJ warrants - (130 ) Series LL warrants - 243 Net gain on warrant liabilities $ 932,836 $ 766,509 The Company reviews all outstanding warrants in accordance with the requirements of ASC 815. This topic provides that an entity should use a two-step approach to evaluate whether an equity-linked financial instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and settlement provisions. The warrant agreements provide for adjustments to the exercise price for certain dilutive events. Under the provisions of ASC 815, the warrants are not considered indexed to the Company’s stock because future equity offerings or sales of the Company’s stock are not an input to the fair value of a “fixed-for-fixed” option on equity shares, and equity classification is therefore precluded. In accordance with ASC 815, derivative liabilities must be measured at fair value upon issuance and re-valued at the end of each reporting period through expiration. Any change in fair value between the respective reporting dates is recognized as a gain or loss. Changes in Warrant Liabilities On October 28, 2020, 688,930 Series W warrants, with an exercise price of $16.75 expired. During the three months ended December 31, 2020, 5,000 Series CC warrants were exercised at an exercise price of $5.00 for gross proceeds of $25,000. No warrants recorded as liabilities were exercised during the three months ended December 31, 2019. 2. Equity Warrants Changes in Equity Warrants On December 7, 2020, the expiration date of the Series N warrants was extended six months from February 18, 2021 to August 18, 2021. The incremental cost of this extension was approximately $1,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. The Series N warrants are held by the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary. On December 7, 2020, the expiration date of the Series X warrants was extended six months from January 13, 2021 to July 13, 2021. The incremental cost of this extension was approximately $85,000, which was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. The Series X warrants are held by the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary. On December 7, 2020, the expiration date of the Series Y warrants, which were issued in connection with a financing, was extended six months from February 15, 2021 to August 15, 2021. The incremental cost of this extension was approximately $41,000 and was recorded as additional paid-in capital. On December 7, 2020, the expiration date of Series UU warrants were extended six months from December 31, 2020 to June 30, 2021. These warrants were previously issued as an inducement to convert notes payable into shares of common stock. The incremental cost of this extension was $192 and was recorded as interest expense for the three months ended December 31, 2020. The Series UU warrants are held by Geert Kersten, Patricia Prichep (current Officers of the Company) and the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary. Exercise of Equity Warrants During the three months ended December 31, 2020, 10,000 Series TT warrants were exercised at an exercise price of $2.24 for gross proceeds of $22,400. The following warrants recorded as equity were exercised during the three months ended December 31, 2019. Warrants Warrants Exercised Exercise Price Proceeds Series OO 10,000 $ 2.52 $ 25,200 Series SS 22,632 $ 2.09 47,301 Series TT 100,628 $ 2.24 224,600 132,900 $ 297,101 3. Options and Shares Issued to Consultants During the three months ended December 31, 2020 and 2019, the Company issued 15,044 and 15,819 shares of restricted common stock, respectively, to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $12.45 and $7.18, respectively, during the three months ended December 31, 2020 and 2019. Additionally, during the three months ended December 31, 2020, the Company issued to a consultant 5,000 options to purchase common stock with an exercise price of $11.61. The options are exercisable beginning May 18, 2021 and expire on November 17, 2022. The options are being expensed on a straight-line basis over the six month vesting period at a fair value of approximately $28,000 or $5.65 per option. No options were issued to consultants during the three months ended December 31, 2019. As of December 31, 2020 and September 30, 2020, 15,000 and 10,000 options issued to consultants remained outstanding, respectively, all of which were issued from the Non-Qualified Stock Option plans and of which 10,000 are vested as of the balance sheet dates. During the three months ended December 31, 2020 and 2019, the Company recorded total expense of approximately $249,000 and $156,000, respectively, relating to these consulting agreements. At December 31, 2020 and September 30, 2020, approximately $244,000 and $395,000, respectively, are included in prepaid expenses. 4. Securities Purchase Agreement The Company entered into a Securities Purchase Agreement with Ergomed plc, one of the Company’s Clinical Research Organizations responsible for managing the Company’s Phase 3 clinical trial, to facilitate payment of amounts due to Ergomed. Under the Agreement, the Company issued Ergomed shares of common stock that the net proceeds from the sales of those shares would reduce outstanding amounts due Ergomed. Upon issuance, the Company expenses the full value of the shares as Other non-operating gain/loss and subsequently offsets the expense as amounts are realized through the sale by Ergomed and reduces accounts payable to Ergomed. During the three months ended December 31, 2020 and 2019, the Company realized approximately $0.1 million and $0.8 million, respectively, through the sale by Ergomed of 9,000 and 98,350 shares of the Company’s common stock and the Company reduced the payables to Ergomed, and credited Other Operating Gain by those amounts. No shares were issued to Ergomed during the quarters ended December 31, 2020 and 2019. As of December 31, 2020, Ergomed held 93,521 shares for resale. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
D. FAIR VALUE MEASUREMENTS | D. FAIR VALUE MEASUREMENTS In accordance with ASC 820-10, “Fair Value Measurements,” ASC 820-10 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to active markets for identical assets and liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The Company classifies fair value balances based on the observability of those inputs. The three levels of the fair value hierarchy are as follows: · Level 1 - Observable inputs such as quoted prices in active markets for identical assets or liabilities · Level 2 - Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and amounts derived from valuation models where all significant inputs are observable in active markets · Level 3 - Unobservable inputs that reflect management’s assumptions For disclosure purposes, assets and liabilities are classified in their entirety in the fair value hierarchy level based on the lowest level of input that is significant to the overall fair value measurement. The Company’s assessment of the significance of an input to the fair value measurement requires judgment and may affect the placement within the fair value hierarchy levels. The table below sets forth the assets and liabilities measured at fair value on a recurring basis, by input level, in the condensed balance sheet at December 31, 2020: Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Derivative instruments $ - $ - $ 2,790,927 $ 2,790,927 The table below sets forth the assets and liabilities measured at fair value on a recurring basis, by input level, in the condensed balance sheet at September 30, 2020: Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Derivative instruments $ - $ - $ 3,765,613 $ 3,765,613 The following sets forth the reconciliation of beginning and ending balances related to fair value measurements using significant unobservable inputs (Level 3) for the three months ended December 31, 2020 and the year ended September 30, 2020: 3 months ended December 31, 2020 12 months ended September 30, 2020 Beginning balance $ 3,765,613 $ 6,488,310 Issuances - - Exercises (41,850 ) (3,071,775 ) Realized and unrealized (gains) and losses (932,836 ) 349,078 Ending balance $ 2,790,927 $ 3,765,613 The fair values of the Company’s derivative instruments disclosed above under Level 3 are primarily derived from valuation models where significant inputs such as historical price and volatility of the Company’s stock, as well as U.S. Treasury Bill rates, are observable in active markets. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Dec. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
E. RELATED PARTY TRANSACTIONS | E. RELATED PARTY TRANSACTIONS On December 7, 2020, the expiration dates of the Series N and Series X warrants held by the de Clara Trust, of which the Company’s CEO, Geert Kersten, is a beneficiary, were extended by six months (Note C). The incremental cost of these modifications was approximately $86,000 and was recorded as a deemed dividend in the financial statements for the three months ended December 31, 2020. On December 7, 2020, the expiration date of 93,603 Series UU warrants was extended from December 31, 2020 to June 30, 2021. The incremental cost of this extension was $192 and was recorded as interest expense for the three months ended December 31, 2020. The Series UU warrants are held by certain officers of the Company and were originally issued with convertible debt. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
F. COMMITMENTS AND CONTINGENCIES | F. C OMMITMENTS AND CONTINGENCIES Clinical Research Agreements Under co-development and revenue sharing agreements with Ergomed, Ergomed agreed to contribute up to $12 million towards the Company’s Phase 3 Clinical Trial in the form of discounted clinical services in exchange for a single digit percentage of milestone and royalty payments, up to a specific maximum amount. The Company accounted for the co-development and revenue sharing agreements in accordance with ASC 808 “Collaborative Arrangements”. The Company determined the payments to Ergomed are within the scope of ASC 730 “Research and Development.” Therefore, the Company records the discount on the clinical services as a credit to research and development expense on its Statements of Operations. Since the inception of the agreement with Ergomed, the Company has incurred research and development expenses of approximately $34.0 million for Ergomed’s services. This amount is net of Ergomed’s discount of approximately $11.3 million. During the three months ended December 31, 2020 and 2019, the Company recorded, net of Ergomed’s discount, approximately $0.6 million and $0.9 million, respectively, as research and development expense related to Ergomed’s services. Lease Agreements The Company leases a manufacturing facility near Baltimore, Maryland (the San Tomas lease). The building was remodeled in accordance with the Company’s specifications so that it can be used by the Company to manufacture Multikine for the Company’s Phase 3 clinical trial and sales of the drug if approved by the FDA. The lease is for a term of twenty years and requires annual base rent to escalate each year at 3%. The Company is required to pay all real estate and personal property taxes, insurance premiums, maintenance expenses, repair costs and utilities. The lease allows the Company, at its election, to extend the lease for two ten-year periods or to purchase the building at the end of the 20-year lease, which expires in October 2028. On December 31, 2020 and September 30, 2020, the net book value of the finance lease right of use asset is approximately $13.4 million and $13.8 million, respectively and the balance of the finance lease liability is approximately $12.5 million and $12.7 million, respectively, of which approximately $1.0 million and $0.9 million, respectively, is current. These amounts include the San Tomas lease as well as several other smaller finance leases for office equipment. The finance right of use assets are being depreciated using a straight-line method over the underlying lease terms. Total cash paid related to finance leases during the each of the three months ended December 31, 2020 and 2019 was approximately $0.5 million, of which approximately $0.3 million was for interest. The weighted average discount rate of the Company’s finance leases is 8.8% and the weighted average time to maturity is 7.8 years. In August 2020, the Company entered into an amendment to the San Tomas lease agreement under which the landlord agreed to allow the Company to substantially upgrade the manufacturing facility in preparation for the potential commercial production of Multikine. The estimated cost of the upgrades is $10.5 million, of which approximately $6.7 million has been incurred to date. Pursuant to the amendment, the landlord agreed to finance the final $2.4 million of the costs incurred, i.e., after the Company has financed the initial $8.1 million. Per the terms of the financing, upon completion of the project, the $2.4 million will be repaid through increased lease payments over the remaining lease term. The Company was required to deposit the equivalent of one year of base rent in accordance with the lease. When the Company meets the minimum cash balance required by the lease, the deposit will be returned to the Company. The approximate $1.7 million deposit is included in non-current assets at December 31, 2020 and September 30, 2020. Approximate future minimum lease payments under finance leases as of December 31, 2020 are as follows: Nine months ending September 30, 2021 $ 1,469,000 Year ending September 30, 2022 2,014,000 2023 2,083,000 2024 2,148,000 2025 2,218,000 2026 2,294,000 Thereafter 5,028,000 Total future minimum lease obligation 17,254,000 Less imputed interest on finance lease obligations (4,789,000 ) Net present value of lease finance lease obligations $ 12,465,000 Effective April 30, 2020, the Company terminated a month-to-month arrangement with a sub-lessee as the sub-leased space is needed to prepare the facility to produce Multikine for commercial purposes and before the Company’s Biologics License Application (BLA) can be submitted to the FDA. The sublease rental income for the three months ended December 31, 2019 was approximately $18,000. The Company leases two facilities under 60-month operating leases - the lease for its research and development laboratory expires February 28, 2022 and the lease for its office headquarters was renewed on July 1, 2020 and expires on November 30, 2025.The operating leases include escalating rental payments. The Company is recognizing the related rent expense on a straight-line basis over the full 60-month terms of the leases. As of December 31, 2020 and September 30, 2020, the net book value of the operating lease right of use assets is approximately $1.2 million. As of December 31, 2020 and September 30, 2020, the balance of the operating lease liabilities is approximately $1.2 million and $1.3 million, respectively, of which approximately $0.2 million and $0.1 million, respectively, is current. The Company incurred lease expense for operating leases of approximately $66,000 and $68,000, respectively, for the three months ended December 31, 2020 and 2019. Total cash paid related to operating leases during the three months ended December 31, 2020 and 2019 was approximately $48,000 and $66,000, respectively. As of December 31, 2020, future minimum lease payments on operating leases are as follows: Nine months ending September 30, 2021 $ 193,000 Year ending September 30, 2022 264,000 2022 272,000 2024 280,000 2025 288,000 2026 207,000 Thereafter 80,000 Total future minimum lease obligation 1,584,000 Less imputed interest on operating lease obligation (354,000 ) Net present value of operating lease obligation $ 1,230,000 |
PATENTS
PATENTS | 3 Months Ended |
Dec. 31, 2020 | |
PATENTS | |
G. PATENTS | G. PATENTS During the three months ended December 31, 2020 and 2019, no patent impairment charges were recorded. For both the three months ended December 31, 2020 and 2019, amortization of patent costs totaled approximately $13,000. Approximate estimated future amortization expense is as follows: Nine months ending September 30, 2021 $ 39,000 Year ending September 30, 2022 48,000 2023 38,000 2024 30,000 2025 27,000 2026 24,000 Thereafter 94,000 Total $ 300,000 |
LOSS PER COMMON SHARE
LOSS PER COMMON SHARE | 3 Months Ended |
Dec. 31, 2020 | |
LOSS PER COMMON SHARE | |
H. LOSS PER COMMON SHARE | H. LOSS PER COMMON SHARE The following tables provide the details of the basic and diluted loss per-share computations: Three months ended December 31, 2020 2019 Loss per share - basic Net loss available to common shareholders - basic $ (8,022,643 ) $ (5,531,360 ) Weighted average shares outstanding - basic 38,670,247 35,084,279 Basic loss per common share $ (0.21 ) $ (0.16 ) Loss per share - diluted Net loss available to common shareholders - basic $ (8,022,643 ) $ (5,531,360 ) Gain on derivatives (1) (164,073 ) (243 ) Net loss available to common shareholders - diluted $ (8,186,716 ) $ (5,531,603 ) Weighted average shares outstanding - basic 38,670,247 35,084,279 Incremental shares underlying dilutive - warrants and options (1) 97,039 14,329 Weighted average shares outstanding - diluted 38,767,286 35,098,608 Diluted loss earnings per common share $ (0.21 ) $ (0.16 ) (1) Includes Series CC and HH warrants for the three months ended December 31, 2020 and Series LL warrants for the three months ended December 31, 2019. The gain on derivatives priced lower than the average market price during the period is excluded from the numerator and the related shares are excluded from the denominator in calculating diluted loss per share. In accordance with the contingently issuable shares guidance of FASB ASC Topic 260, Earnings Per Share 2020 2019 Options and Warrants 6,517,160 7,009,959 Unvested Restricted Stock 302,500 304,500 Total 6,819,660 7,314,459 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Dec. 31, 2020 | |
SUBSEQUENT EVENTS | |
J. SUBSEQUENT EVENTS | J. SUBSEQUENT EVENTS Between January 1, 2021 and February 5, 2021, the Company received approximately $3.9 million through the exercise of options and warrants to purchase shares of the Company’s common stock. |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (POLICIES) | 3 Months Ended |
Dec. 31, 2020 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Property Equipment | Property and Equipment |
Patents | Patents |
Research and Development Costs | Research and Development Costs |
Leases | Leases - |
Income Taxes | Income Taxes |
Derivative Instruments | Derivative Instruments |
Stock-Based Compensation | Stock-Based Compensation The Company has Incentive Stock Option Plans, Non-Qualified Stock Option Plans, Stock Compensation Plans, Stock Bonus Plans and an Incentive Stock Bonus Plan. In some cases, these Plans are collectively referred to as the "Plans". All Plans have been approved by the stockholders. The Company’s stock options are not transferable, and the actual value of the stock options that an employee may realize, if any, will depend on the excess of the market price on the date of exercise over the exercise price. The Company has based its assumption for stock price volatility on the variance of daily closing prices of the Company’s common stock. The risk-free interest rate assumption was based on the U.S. Treasury rate at date of the grant with term equal to the expected life of the option. Forfeitures are accounted for when they occur. The expected term of options represents the period that options granted are expected to be outstanding and has been determined based on an analysis of historical exercise behavior. If any of the assumptions used in the Black-Scholes model change significantly, stock-based compensation expense for new awards may differ materially in the future from that recorded in the current period. Vesting of restricted stock granted under the Incentive Stock Bonus Plan and options granted under the 2020 Non-Qualified Stock Option Plan are subject to service, performance and market conditions and meet the classification of equity awards. These awards were measured at market value on the grant-dates for issuances where the attainment of performance criteria is likely and at fair value on the grant-dates, using a Monte Carlo simulation for issuances where the attainment of performance criteria is uncertain. The total compensation cost will be expensed over the estimated requisite service period. |
New Accounting Pronouncements | Newly Adopted Accounting Pronouncements In August 2018, the FASB issued ASU 2018-13, “ Fair Value Measurement - Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (Topic ).” New Accounting Pronouncements In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes The Company has considered all other recently issued accounting pronouncements and does not believe the adoption of such pronouncements will have a material impact on its financial statements. |
STOCKHOLDERS EQUITY (Tables)
STOCKHOLDERS EQUITY (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
STOCKHOLDERS EQUITY | |
Stock options, stock bonuses and compensation granted by the Company | Name of Plan Total Shares Reserved Shares Reserved for Outstanding Options Shares Remaining Options/Shares Under Plans Incentive Stock Options Plans 138,400 85,895 N/A 213 Non-Qualified Stock Option Plans 9,987,200 8,527,787 N/A 1,201,832 Stock Bonus Plans 783,760 N/A 348,660 435,067 Stock Compensation Plans 634,000 N/A 150,695 464,895 Incentive Stock Bonus Plan 640,000 N/A 614,500 25,500 Underlying share information for equity compensation plans as of September 30, 2020 is as follows: Name of Plan Total Shares Reserved Shares Reserved for Outstanding Options Shares Remaining Options/Shares Under Plans Incentive Stock Option Plans 138,400 85,895 N/A 213 Non-Qualified Stock Option Plans 9,987,200 8,567,808 N/A 1,167,166 Stock Bonus Plans 783,760 N/A 345,096 438,631 Stock Compensation Plans 634,000 N/A 150,695 464,895 Incentive Stock Bonus Plan 640,000 N/A 616,500 23,500 |
Stock option activity | Three Months Ended December 31, 2020 2019 Options granted 7,500 1,000 Options exercised 5,300 - Options forfeited 42,166 - Options expired 55 36 |
Stock-based compensation expense | Three months Ended December 31, 2020 2019 Employees $ 3,296,309 $ 1,800,225 Non-employees $ 248,660 $ 155,740 |
Derivative liabilities, warrants and other options | Warrant/Options Issue Date Shares Issuable upon Exercise of Warrants/ Options Exercise Price Expiration Date Reference Series N 8/18/2008 85,339 $ 3.00 8/18/2021 2 Series UU 6/11/2018 93,603 $ 2.80 6/30/2021 2 Series X 1/13/2016 120,000 $ 9.25 7/13/2021 2 Series Y 2/15/2016 26,000 $ 12.00 8/15/2021 2 Series ZZ 5/23/2016 20,000 $ 13.75 5/18/2021 * Series BB 8/26/2016 16,000 $ 13.75 8/22/2021 * Series Z 5/23/2016 264,000 $ 13.75 11/23/2021 * Series FF 12/8/2016 68,048 $ 3.91 12/1/2021 * Series CC 12/8/2016 143,643 $ 5.00 12/8/2021 1 Series HH 2/23/2017 200 $ 3.13 2/16/2022 * Series AA 8/26/2016 200,000 $ 13.75 2/22/2022 * Series MM 6/22/2017 797,633 $ 1.86 6/22/2022 * Series NN 7/24/2017 348,842 $ 2.52 7/24/2022 * Series RR 10/30/2017 417,649 $ 1.65 10/30/2022 * Series SS 12/19/2017 326,064 $ 2.09 12/18/2022 * Series TT 2/5/2018 361,564 $ 2.24 2/5/2023 2 Consultants 7/28/2017 - 11/18/2020 15,000 $ 2.18-11.61 11/17/2022 - 7/27/2027 3 |
Tabular disclosure of derivative liabilities at fair value | December 31, 2020 September 30, 2020 Series W warrants $ - $ 73,570 Series Z warrants 929,539 1,207,902 Series ZZ warrants 23,177 75,044 Series AA warrants 748,404 1,082,212 Series BB warrants 34,541 65,173 Series CC warrants 1,053,517 1,259,712 Series HH warrants 1,749 2,000 Total warrant liabilities $ 2,790,927 $ 3,765,613 |
Schedule of gains and (losses) on derivative liabilities | 2020 2019 Series V warrants $ - $ 555,031 Series W warrants 73,570 151,374 Series Z warrants 278,363 10,549 Series ZZ warrants 51,867 14,847 Series AA warrants 333,808 64,978 Series BB warrants 30,632 (431 ) Series CC warrants 164,345 (22,681 ) Series FF warrants - (7,189 ) Series HH warrants 251 (82 ) Series JJ warrants - (130 ) Series LL warrants - 243 Net gain on warrant liabilities $ 932,836 $ 766,509 |
Warrants recorded as equity exercised | Warrants Warrants Exercised Exercise Price Proceeds Series OO 10,000 $ 2.52 $ 25,200 Series SS 22,632 $ 2.09 47,301 Series TT 100,628 $ 2.24 224,600 132,900 $ 297,101 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
FAIR VALUE MEASUREMENTS | |
Measured at fair value on a recurring basis | Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Derivative instruments $ - $ - $ 2,790,927 $ 2,790,927 Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Derivative instruments $ - $ - $ 3,765,613 $ 3,765,613 |
Reconciliation of beginning and ending balances related to fair value measurements using significant unobservable inputs (Level 3) | 3 months ended December 31, 2020 12 months ended September 30, 2020 Beginning balance $ 3,765,613 $ 6,488,310 Issuances - - Exercises (41,850 ) (3,071,775 ) Realized and unrealized (gains) and losses (932,836 ) 349,078 Ending balance $ 2,790,927 $ 3,765,613 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of future minimum payments under finance leases | Nine months ending September 30, 2021 $ 1,469,000 Year ending September 30, 2022 2,014,000 2023 2,083,000 2024 2,148,000 2025 2,218,000 2026 2,294,000 Thereafter 5,028,000 Total future minimum lease obligation 17,254,000 Less imputed interest on finance lease obligations (4,789,000 ) Net present value of lease finance lease obligations $ 12,465,000 Nine months ending September 30, 2021 $ 193,000 Year ending September 30, 2022 264,000 2022 272,000 2024 280,000 2025 288,000 2026 207,000 Thereafter 80,000 Total future minimum lease obligation 1,584,000 Less imputed interest on operating lease obligation (354,000 ) Net present value of operating lease obligation $ 1,230,000 |
PATENTS (Tables)
PATENTS (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
PATENTS | |
Schedule of total estimated future amortization | Nine months ending September 30, 2021 $ 39,000 Year ending September 30, 2022 48,000 2023 38,000 2024 30,000 2025 27,000 2026 24,000 Thereafter 94,000 Total $ 300,000 |
LOSS PER COMMON SHARE (Tables)
LOSS PER COMMON SHARE (Tables) | 3 Months Ended |
Dec. 31, 2020 | |
LOSS PER COMMON SHARE | |
Schedule of basic and diluted loss per-share computations | Three months ended December 31, 2020 2019 Loss per share - basic Net loss available to common shareholders - basic $ (8,022,643 ) $ (5,531,360 ) Weighted average shares outstanding - basic 38,670,247 35,084,279 Basic loss per common share $ (0.21 ) $ (0.16 ) Loss per share - diluted Net loss available to common shareholders - basic $ (8,022,643 ) $ (5,531,360 ) Gain on derivatives (1) (164,073 ) (243 ) Net loss available to common shareholders - diluted $ (8,186,716 ) $ (5,531,603 ) Weighted average shares outstanding - basic 38,670,247 35,084,279 Incremental shares underlying dilutive - warrants and options (1) 97,039 14,329 Weighted average shares outstanding - diluted 38,767,286 35,098,608 Diluted loss earnings per common share $ (0.21 ) $ (0.16 ) |
Schedule of antidilutive securities | 2020 2019 Options and Warrants 6,517,160 7,009,959 Unvested Restricted Stock 302,500 304,500 Total 6,819,660 7,314,459 |
A BASIS OF PRESENTATION AND SUM
A BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 3 Months Ended |
Dec. 31, 2020 | |
Patents [Member] | |
Patent useful life | 17 years |
C STOCKHOLDERS EQUITY (Details)
C STOCKHOLDERS EQUITY (Details) - shares | Dec. 31, 2020 | Sep. 30, 2020 |
Incentive Stock Option Plans [Member] | ||
Shares reserved for outstanding options | 85,895 | 85,895 |
Remaining options/shares under plans | 213 | 213 |
Total shares reserved under plans | 138,400 | 138,400 |
Non-Qualified Stock Option Plans [Member] | ||
Shares reserved for outstanding options | 8,527,787 | 8,567,808 |
Remaining options/shares under plans | 1,201,832 | 1,167,166 |
Total shares reserved under plans | 9,987,200 | 9,987,200 |
Stock Bonus Plans [Member] | ||
Remaining options/shares under plans | 435,067 | 438,631 |
Total shares reserved under plans | 783,760 | 783,760 |
Shares issued | 348,660 | 345,096 |
Stock Compensation Plan [Member] | ||
Remaining options/shares under plans | 464,895 | 464,895 |
Total shares reserved under plans | 634,000 | 634,000 |
Shares issued | 150,695 | 150,695 |
Incentive Stock Bonus Plan [Member] | ||
Remaining options/shares under plans | 25,500 | 23,500 |
Total shares reserved under plans | 640,000 | 640,000 |
Shares issued | 614,500 | 616,500 |
C STOCKHOLDERS EQUITY (Details
C STOCKHOLDERS EQUITY (Details 1) - shares | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
STOCKHOLDERS EQUITY | ||
Options granted | 7,500 | 1,000 |
Options exercised | 5,300 | |
Options forfeited | 42,166 | |
Options expired | 55 | 36 |
C STOCKHOLDERS EQUITY (Detail_2
C STOCKHOLDERS EQUITY (Details 2) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
STOCKHOLDERS EQUITY | ||
Employees stock based compensation expense | $ 3,296,309 | $ 1,800,225 |
Non- Employees stock based compensation expense | $ 248,660 | $ 155,740 |
C STOCKHOLDERS EQUITY (Detail_3
C STOCKHOLDERS EQUITY (Details 3) | 3 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Series N [Member] | |
Shares issuable upon exercise of warrant/options | shares | 85,339 |
Exercise price | $ 3 |
Issue date | 8/18/2008 |
Expiration date | 8/18/2021 |
Series UU [Member] | |
Shares issuable upon exercise of warrant/options | shares | 93,603 |
Exercise price | $ 2.80 |
Issue date | 6/11/2018 |
Expiration date | 6/30/2021 |
Series X [Member] | |
Shares issuable upon exercise of warrant/options | shares | 120,000 |
Exercise price | $ 9.25 |
Issue date | 1/13/2016 |
Expiration date | 7/13/2021 |
Series Y [Member] | |
Shares issuable upon exercise of warrant/options | shares | 26,000 |
Exercise price | $ 12 |
Issue date | 2/15/2016 |
Expiration date | 8/15/2021 |
Series ZZ [Member] | |
Shares issuable upon exercise of warrant/options | shares | 20,000 |
Exercise price | $ 13.75 |
Issue date | 5/23/2016 |
Expiration date | 5/18/2021 |
Series BB [Member] | |
Shares issuable upon exercise of warrant/options | shares | 16,000 |
Exercise price | $ 13.75 |
Issue date | 8/26/2016 |
Expiration date | 8/22/2021 |
Series Z [Member] | |
Shares issuable upon exercise of warrant/options | shares | 264,000 |
Exercise price | $ 13.75 |
Issue date | 5/23/2016 |
Expiration date | 11/23/2021 |
Series FF [Member] | |
Shares issuable upon exercise of warrant/options | shares | 68,048 |
Exercise price | $ 3.91 |
Issue date | 12/8/2016 |
Expiration date | 12/1/2021 |
Series CC [Member] | |
Shares issuable upon exercise of warrant/options | shares | 143,643 |
Exercise price | $ 5 |
Issue date | 12/8/2016 |
Expiration date | 12/8/2021 |
Series HH [Member] | |
Shares issuable upon exercise of warrant/options | shares | 200 |
Exercise price | $ 3.13 |
Issue date | 2/23/2017 |
Expiration date | 2/16/2022 |
Series AA [Member] | |
Shares issuable upon exercise of warrant/options | shares | 200,000 |
Exercise price | $ 13.75 |
Issue date | 8/26/2016 |
Expiration date | 2/22/2022 |
Series MM [Member] | |
Shares issuable upon exercise of warrant/options | shares | 797,633 |
Exercise price | $ 1.86 |
Issue date | 6/22/2017 |
Expiration date | 6/22/2022 |
Series NN [Member] | |
Shares issuable upon exercise of warrant/options | shares | 348,842 |
Exercise price | $ 2.52 |
Issue date | 7/24/2017 |
Expiration date | 7/24/2022 |
Series RR [Member] | |
Shares issuable upon exercise of warrant/options | shares | 417,649 |
Exercise price | $ 1.65 |
Issue date | 10/30/2017 |
Expiration date | 10/30/2022 |
Series SS [Member] | |
Shares issuable upon exercise of warrant/options | shares | 326,064 |
Exercise price | $ 2.09 |
Issue date | 12/19/2017 |
Expiration date | 12/18/2022 |
Series TT [Member] | |
Shares issuable upon exercise of warrant/options | shares | 361,564 |
Exercise price | $ 2.24 |
Issue date | 2/5/2018 |
Expiration date | 2/5/2023 |
Consultants [Member] | |
Shares issuable upon exercise of warrant/options | shares | 15,000 |
Expiration date | November 17, 2022 |
Consultants [Member] | Minimum [Member] | |
Exercise price | $ 2.18 |
Issue date | 7/28/2017 |
Expiration date | 11/17/2022 |
Consultants [Member] | Maximum [Member] | |
Exercise price | $ 11.61 |
Issue date | 11/18/2020 |
Expiration date | 7/27/2027 |
C STOCKHOLDERS EQUITY (Detail_4
C STOCKHOLDERS EQUITY (Details 4) - USD ($) | 3 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | |
STOCKHOLDERS EQUITY | |||
Series W warrants | $ 0 | $ 73,570 | |
Series Z warrants | 929,539 | 1,207,902 | |
Series ZZ warrants | 23,177 | 75,044 | |
Series AA warrants | 748,404 | 1,082,212 | |
Series BB warrants | 34,541 | 65,173 | |
Series CC warrants | 1,053,517 | 1,259,712 | |
Series HH warrants | 1,749 | 2,000 | |
Total warrant liabilities | 2,790,927 | $ 3,765,613 | |
Gains (losses) on Series V warrants | 0 | $ 555,031 | |
Gains (losses) on Series W warrants | 73,570 | 151,374 | |
Gains (losses) on Series Z warrants | 278,363 | 10,549 | |
Gains (losses) on Series ZZ warrants | 51,867 | 14,847 | |
Gains (losses) on Series AA warrants | 333,808 | 64,978 | |
Gains (losses) on Series BB warrants | 30,632 | (431) | |
Gains (losses) on Series CC warrants | 164,345 | (22,681) | |
Gains (losses) on Series FF warrants | 0 | (7,189) | |
Gains (losses) on Series HH warrants | 251 | (82) | |
Gains (losses) on Series JJ warrants | 0 | (130) | |
Gains (losses) on Series LL warrants | 0 | 243 | |
Net loss on warrant liabilities | $ 932,836 | $ 766,509 |
C STOCKHOLDERS EQUITY (Detail_5
C STOCKHOLDERS EQUITY (Details 5) | 3 Months Ended |
Dec. 31, 2019USD ($)$ / sharesshares | |
Warrants exercised | shares | 132,900 |
Proceeds | $ | $ 297,101 |
Series SS [Member] | |
Warrants exercised | shares | 22,632 |
Proceeds | $ | $ 47,301 |
Exercise price | $ / shares | $ 2.09 |
Series TT [Member] | |
Warrants exercised | shares | 100,628 |
Proceeds | $ | $ 224,600 |
Exercise price | $ / shares | $ 2.24 |
Series OO [Member] | |
Warrants exercised | shares | 10,000 |
Proceeds | $ | $ 25,200 |
Exercise price | $ / shares | $ 2.52 |
C STOCKHOLDERS EQUITY (Detail_6
C STOCKHOLDERS EQUITY (Details Narrative) - USD ($) | Dec. 07, 2020 | Sep. 30, 2020 | Jun. 25, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 |
Prepaid expenses | $ 244,000 | $ 395,000 | ||||
Proceeds from the sale of common stock | 1,000,000 | |||||
Public offering price per share | $ 14.65 | |||||
Proceeds from public offering | $ 13,600,000 | |||||
Additional shares of common stock | 150,000 | |||||
Fair value of stock option | $ 28,000 | |||||
Weighted average grant date fair value | $ 5.65 | |||||
Proceeds from warrants exercised | $ 70,911 | $ 297,101 | ||||
Stock options granted | 7,500 | 1,000 | ||||
Warrants expired | 55 | 36 | ||||
Common stock shares issued | 38,730,150 | 39,767,058 | ||||
Common stock valued | $ 387,302 | $ 397,671 | ||||
Consulting Agreements [Member] | ||||||
Total expense | $ 249,000 | $ 156,000 | ||||
Series W Warrants [Member] | ||||||
Common stock price per share | $ 16.75 | |||||
Warrants expired | 688,930 | |||||
Non-Qualified Stock Option Plans [Member] | ||||||
Stock options granted | 10,000 | |||||
Series X [Member] | ||||||
Incremental cost | $ 85,000 | |||||
Expiration date description | the expiration date of the Series X warrants was extended six months from January 13, 2021 to July 13, 2021 | |||||
Expiration date | 7/13/2021 | |||||
Series Y [Member] | ||||||
Incremental cost | $ 41,000 | |||||
Expiration date | 8/15/2021 | |||||
Series CC [Member] | ||||||
Warrants exercised | 5,000 | |||||
Warrant exercise price | $ 5 | |||||
Proceeds from warrants exercised | $ 25,000 | |||||
Expiration date | 12/8/2021 | |||||
Series TT [Member] | ||||||
Warrants exercised | 10,000 | |||||
Warrant exercise price | $ 2.24 | |||||
Proceeds from warrants exercised | $ 22,400 | |||||
Expiration date | 2/5/2023 | |||||
Series UU warrants [Member] | ||||||
Incremental cost | $ 192 | |||||
Expiration date description | the expiration date of Series UU warrants were extended six months from December 31, 2020 to June 30, 2021 | |||||
Series N Warrants [Member] | ||||||
Incremental cost | $ 1,000 | |||||
Expiration date description | the expiration date of the Series N warrants was extended six months from February 18, 2021 to August 18, 2021 | |||||
Consultants One [Member] | ||||||
Options issued | 10,000 | 15,000 | ||||
Ergomed [Member] | ||||||
Common stock shares held | 93,521 | |||||
Common stock shares issued | 9,000 | 98,350 | ||||
Ergomed [Member] | SPA [Member] | ||||||
Common stock valued | $ 100,000 | $ 800,000 | ||||
Consultants [Member] | ||||||
Exercise price | $ 11.61 | |||||
Options issued | 5,000 | |||||
Expiration date | November 17, 2022 | |||||
Consultants [Member] | Restricted Stock [Member] | ||||||
Weighted average grant date fair value | $ 12.45 | $ 7.18 | ||||
Common stock issued for service, shares | 15,044 | 15,819 |
D FAIR VALUE MEASUREMENTS (Deta
D FAIR VALUE MEASUREMENTS (Details) - USD ($) | Dec. 31, 2020 | Sep. 30, 2020 |
Derivative instruments | $ 2,790,927 | $ 3,765,613 |
Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1) | ||
Derivative instruments | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Derivative instruments | 2,790,927 | 3,765,613 |
Significant Other Observable Inputs (Level 2) | ||
Derivative instruments | $ 0 | $ 0 |
D FAIR VALUE MEASUREMENTS (De_2
D FAIR VALUE MEASUREMENTS (Details 1) - USD ($) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2020 | Sep. 30, 2019 | |
FAIR VALUE MEASUREMENTS | ||
Beginning balance | $ 3,765,613 | $ 6,488,310 |
Issuances | 0 | 0 |
Exercises | 41,850 | 3,071,775 |
Realized and unrealized (gains) and losses | (932,836) | 349,078 |
Ending balance | $ 2,790,927 | $ 3,765,613 |
ERELATED PARTY TRANSACTIONS (De
ERELATED PARTY TRANSACTIONS (Details Narrative ) | 3 Months Ended |
Dec. 31, 2020USD ($) | |
Deemed dividend | $ 86,000 |
Series UU warrants [Member] | |
Expiration date description | the expiration date of 93,603 Series UU warrants was extended from December 31, 2020 to June 30, 2021 |
Interest expense | $ 192 |
F COMMITMENTS AND CONTINGENCIES
F COMMITMENTS AND CONTINGENCIES (Details) | Dec. 31, 2020USD ($) |
COMMITMENTS AND CONTINGENCIES | |
Nine months ending September 30, 2021 | $ 1,469,000 |
2022 | 2,014,000 |
2023 | 2,083,000 |
2024 | 2,148,000 |
2025 | 2,218,000 |
2026 | 2,294,000 |
Thereafter | 5,028,000 |
Total future minimum lease obligation | 17,254,000 |
Less imputed interest on finance lease obligations | (4,789,000) |
Net present value of lease finance lease obligations | $ 12,465,000 |
F COMMITMENTS AND CONTINGENCI_2
F COMMITMENTS AND CONTINGENCIES (Details 1) | Dec. 31, 2020USD ($) |
COMMITMENTS AND CONTINGENCIES | |
Nine months ending September 30, 2021 | $ 193,000 |
2022 | 264,000 |
2023 | 272,000 |
2024 | 280,000 |
2025 | 288,000 |
2026 | 207,000 |
Thereafter | 80,000 |
Total future minimum lease obligation | 1,584,000 |
Less imputed interest on operating lease obligation | 354,000 |
Net present value of operating lease obligation | $ 1,230,000 |
F COMMITMENTS AND CONTINGENCI_3
F COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | ||
Aug. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | |
Lease description | The lease allows the Company, at its election, to extend the lease for two ten-year periods or to purchase the building at the end of the 20-year lease, which expires in October 2028 | |||
Non current assets | $ 1,700,000 | $ 1,700,000 | ||
Clinical service trial | 12,000,000 | |||
Cash paid related to finance leases | 500,000 | $ 500,000 | ||
Cash paid related to finance leases interest | 300,000 | 300,000 | ||
Cash paid related to operating leases | $ 48,000 | 66,000 | ||
Weighted average discount rate | 8.80% | |||
Maturity years | 7 years 9 months 18 days | |||
Finance lease right of use assets | $ 13,400,000 | 13,800,000 | ||
Operating lease - liability | 1,200,000 | 1,300,000 | ||
Operating lease liabilities current | 200,000 | 100,000 | ||
Net book value operating lease right of use assets | 1,200,000 | 1,200,000 | ||
Operating lease expense | 66,000 | 68,000 | ||
Finance lease liability | 12,500,000 | 12,700,000 | ||
Research and development expenses | 34,000,000 | |||
Sublease rental income | 18,000 | |||
Finance lease obligations, net of current portion | 1,000,000 | $ 900,000 | ||
Lease Agreement [Member] | ||||
Estimated cost | $ 10,500,000 | |||
Cost to improve the maufacturing facility | 6,700,000 | |||
Increased lease payments | 2,400,000 | |||
Ergomed [Member] | ||||
Research and development expenses | 600,000 | $ 900,000 | ||
Net of discount | $ 11,300,000 | |||
Landlord [Member] | ||||
Facility improvement costs | 2,400,000 | |||
Cost incurred, initial | $ 8,100,000 |
G PATENTS (Details)
G PATENTS (Details) | Dec. 31, 2020USD ($) |
PATENTS | |
Nine months ending September 30, 2021 | $ 39,000 |
2022 | 48,000 |
2023 | 38,000 |
2024 | 30,000 |
2025 | 27,000 |
2026 | 24,000 |
Thereafter | 94,000 |
Total | $ 300,000 |
G PATENTS (Details Narrative)
G PATENTS (Details Narrative) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
PATENTS | ||
Amortization of patent costs | $ 13,000 | $ 13,000 |
H LOSS PER COMMON SHARE (Detail
H LOSS PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Loss per share - basic | ||
Net loss available to common shareholders - basic | $ (8,022,643) | $ (5,531,360) |
Weighted average shares outstanding - basic | 38,670,247 | 35,084,279 |
Basic loss per common share | $ (0.21) | $ (0.16) |
Loss per share - diluted | ||
Net loss available to common shareholders - basic | $ (8,022,643) | $ (5,531,360) |
Gain on derivatives (1) | (164,073) | (243) |
Net loss available to common shareholders - diluted | (8,186,716) | (5,531,603) |
Weighted average shares outstanding - basic | $ 38,670,247 | $ 35,084,279 |
Incremental shares underlying dilutive "in the money" warrants | 97,039 | 14,329 |
Weighted average shares outstanding - diluted | 38,767,286 | 35,098,608 |
Diluted loss earnings per common share | $ (0.21) | $ (0.16) |
H LOSS PER COMMON SHARE (Deta_2
H LOSS PER COMMON SHARE (Details 1) - shares | 3 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Antidilutive securities | 6,819,660 | 7,314,459 |
Options and Warrants | ||
Antidilutive securities | 6,517,160 | 7,009,959 |
Unvested Restricted Stock | ||
Antidilutive securities | 302,500 | 304,500 |
J SUBSEQUENT EVENTS (Details Na
J SUBSEQUENT EVENTS (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |
Feb. 05, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Proceeds from exercise of options and warrants | $ 70,911 | $ 297,101 | |
Subsequent Event [Member] | |||
Proceeds from exercise of options and warrants | $ 3,900,000 |