Cover
Cover - shares | 3 Months Ended | |
Dec. 31, 2021 | Feb. 02, 2022 | |
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, 2021 | |
Entity Filer Category | Non-accelerated Filer | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Entity Common Stock Shares Outstanding | 43,275,738 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
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 |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) | Dec. 31, 2021 | Sep. 30, 2021 |
Current Assets: | ||
Cash and cash equivalents | $ 37,109,917 | $ 36,060,148 |
U.S. Treasury Bills | 0 | 6,151,385 |
Receivables | 54,922 | 54,922 |
Prepaid expenses | 723,782 | 998,482 |
Supplies used for RD and manufacturing | 2,067,723 | 2,006,584 |
Short-term deposits | 1,910,917 | 0 |
Total current assets | 41,867,261 | 45,271,521 |
Finance lease right of use assets | 12,252,663 | 12,691,921 |
Operating lease right of use assets | 2,014,185 | 2,056,178 |
Property and equipment, net | 13,290,109 | 13,663,562 |
Patent costs, net | 247,521 | 275,866 |
Deposits | 0 | 1,910,917 |
Total assets | 69,671,739 | 75,869,965 |
Current Liabilities: | ||
Accounts payable | 1,192,825 | 1,675,813 |
Accrued expenses | 899,901 | 859,216 |
Due to employees | 475,039 | 265,993 |
Derivative instruments, current portion | 2,195 | 437,380 |
Lease liabilities, current portion | 763,535 | 698,665 |
Total current liabilities | 3,333,495 | 3,937,067 |
Finance lease liabilities, net of current portion | 12,880,449 | 13,252,364 |
Operating lease liabilities, net of current portion | 1,981,340 | 2,021,308 |
Other liabilities | 125,000 | 125,000 |
Total liabilities | 18,320,284 | 19,335,739 |
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; 43,259,013 and 43,207,183 shares issued and outstanding at December 31, 2021 and September 30, 2021, respectively | 432,590 | 432,072 |
Additional paid-in capital | 477,897,883 | 474,298,566 |
Accumulated deficit | (426,979,018) | (418,196,412) |
Total stockholders' equity | 51,351,455 | 56,534,226 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 69,671,739 | $ 75,869,965 |
CONDENSED BALANCE SHEETS (Paren
CONDENSED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2021 | Sep. 30, 2021 |
CONDENSED BALANCE SHEETS | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 2,000,000 | 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 | 43,259,013 | 43,207,183 |
Common stock, shares outstanding | 43,259,013 | 43,207,183 |
CONDENSED STATEMENTS OF OPERATI
CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Operating expenses: | ||
Research and development | $ 6,083,167 | $ 5,414,760 |
General and administrative | 2,760,208 | 3,316,156 |
Total operating expenses | 8,843,375 | 8,730,916 |
Operating loss | (8,843,375) | (8,730,916) |
Gain on derivative instruments | 364,596 | 932,836 |
Other non-operating gains | (30,793) | 121,606 |
Interest expense, net | (273,034) | (260,390) |
Net loss | (8,782,606) | (7,936,864) |
Modification of warrants | (85,779) | |
Net loss available to common shareholders | $ (8,782,606) | $ (8,022,643) |
Net loss per common share | ||
BASIC and DILUTED | $ (0.20) | $ (0.21) |
Weighted average common shares outstanding | ||
BASIC | 43,077,961 | 38,670,247 |
DILUTED | 43,083,420 | 38,767,286 |
STATEMENTS OF STOCKHOLDERS' EQU
STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED) - USD ($) | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit |
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) |
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 |
Warrant exercises, shares | 15,000 | |||
Warrant exercises, amount | 89,250 | $ 150 | 89,100 | 0 |
Equity based compensation - employees, shares | (2,000) | |||
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 and options issued to nonemployees for service, shares | 15,044 | |||
Stock and options issued to nonemployees for service, amount | $ 152,450 | $ 150 | 152,300 | 0 |
Option exercises, shares | 5,300 | 5,300 | ||
Option exercises, amount | $ 23,511 | $ 53 | 23,458 | 0 |
Modification of warrants | 192 | 0 | 192 | 0 |
Share issuance costs | (117,021) | 0 | (117,021) | 0 |
Net loss | (7,936,864) | $ 0 | 0 | (7,936,864) |
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) |
Balance, shares at Sep. 30, 2021 | 43,207,183 | |||
Balance, amount at Sep. 30, 2021 | 56,534,226 | $ 432,072 | 474,298,566 | (418,196,412) |
Warrant exercises, shares | 19,705 | |||
Warrant exercises, amount | 157,954 | $ 197 | 157,757 | 0 |
Equity based compensation - employees, amount | 3,262,296 | $ 0 | 3,262,296 | 0 |
401(k) contributions paid in common stock, shares | 7,605 | |||
401(k) contributions paid in common stock, amount | 52,555 | $ 76 | 52,479 | 0 |
Stock and options issued to nonemployees for service, shares | 18,020 | |||
Stock and options issued to nonemployees for service, amount | $ 143,160 | $ 180 | 142,980 | 0 |
Option exercises, shares | 6,500 | 6,500 | ||
Option exercises, amount | $ 29,835 | $ 65 | 29,770 | 0 |
Share issuance costs | (45,965) | 0 | (45,965) | 0 |
Net loss | (8,782,606) | $ 0 | 0 | (8,782,606) |
Balance, shares at Dec. 31, 2021 | 43,259,013 | |||
Balance, amount at Dec. 31, 2021 | $ 51,351,455 | $ 432,590 | $ 477,897,883 | $ (426,979,018) |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) | ||
Net loss | $ (8,782,606) | $ (7,936,864) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 887,930 | 550,682 |
Share-based payments for services | 218,318 | 248,660 |
Equity based compensation | 3,262,296 | 3,296,309 |
Common stock contributed to 401(k) plan | 52,555 | 41,671 |
Gain on short-term investments | (615) | |
Loss on patent impairment | 30,793 | |
Gain on derivative instruments | (364,596) | (932,836) |
Modification of warrants | 192 | |
(Increase)/decrease in assets: | ||
Receivables | 532,328 | |
Prepaid expenses | 144,542 | (332,785) |
Supplies used for R&D and manufacturing | (61,139) | |
Increase/(decrease) in liabilities: | ||
Accounts payable | (523,152) | 532,679 |
Accrued expenses | 95,685 | 143,028 |
Due to employees | 209,046 | 10,718 |
Other liabilities | 24,997 | 18,319 |
Net cash used in operating activities | (4,805,946) | (3,827,899) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from maturity of US treasury bills | 6,152,000 | |
Purchases of property and equipment | (17,036) | (3,149,820) |
Expenditures for patent costs | (22,741) | |
Net cash provided by (used in) investing activities | 6,112,223 | (3,149,820) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of common stock | 13,559,500 | |
Payments of stock issuance costs | (32,800) | (79,499) |
Proceeds from exercises of warrants and options | 117,200 | 70,911 |
Payments on obligations under finance lease | (340,908) | (221,620) |
Net cash (used in) provided by financing activities | (256,508) | 13,329,292 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 1,049,769 | 6,351,573 |
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD | 36,060,148 | 15,508,909 |
CASH AND CASH EQUIVALENTS, END OF PERIOD | 37,109,917 | 21,860,482 |
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Property and equipment included in current liabilities | 469,005 | 1,700,969 |
Capitalizable patent costs included in current liabilities | 15,000 | |
Finance lease obligation included in accounts payable | 771 | 1,752 |
Prepaid consulting services paid with issuance of common stock | 233,753 | 243,687 |
Exercise of derivative liabilities | 70,589 | 41,850 |
Financing costs included in current liabilities | 13,165 | 88,021 |
Cash paid for interest | $ 290,212 | $ 277,618 |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Dec. 31, 2021 | |
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, 2021. 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, 2021 and the results of its operations for the three months then ended. The condensed balance sheet as of September 30, 2021 is derived from the September 30, 2021 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: Cash and Cash Equivalents U.S. Treasury Bills – Property and Equipment Patents Leases – Derivative Instruments Accounting for Derivative Instruments and Hedging Activities The Company adopted Accounting Standards Update (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 Stock-Based Compensation Compensation – Stock 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. These Plans are collectively referred to as the "Plans". All Plans have been approved by the Company’s 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. For options issued with service conditions only, the Company has based its assumption for stock price volatility on the variance of daily closing prices of the Company’s stock. The risk-free interest rate assumption is based on the U.S. Treasury rate at the date of grant with the 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. Restricted stock granted under the Incentive Stock Bonus Plan and options granted under the 2021 and 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 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. Research and Development Costs Net Loss Per Common Share Income Taxes The Company adopted ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes Use of Estimates New Accounting Pronouncements The Company has considered all 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, 2021 | |
OPERATIONS AND FINANCING | |
B. OPERATIONS AND FINANCING | B. OPERATIONS AND FINANCING On June 28, 2021, the Company announced results from its 9.5 year pivotal Phase 3 study for its immunotherapy Multikine® (Leukocyte Interleukin, Injection) in the treatment of advanced (stages III and IV) primary (previously untreated) squamous cell carcinoma of the head and neck (SCCHN). The Phase 3 results showed a long-term 5 year overall survival (OS) benefit in the treatment arm that received Multikine treatment followed by surgery and radiation. This survival benefit was robust and durable, with no safety issues, something not commonly seen with cancer drugs. In fact, the survival benefit increased over time and at 5 years the overall survival benefit reached an absolute 14.1% advantage for the Multikine treated arm over control (n=380, total study patients treated with surgery plus radiation), control arm 48.6%, Multikine arm 62.7% survival. Liquidity 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 efforts to bring Multikine to market. 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 obtain approval from the U.S. Food and Drug Administration (FDA) 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 similarly to the way it has funded operations in the past. 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 it showed great survival benefit in the Phase 3 study in one of the two treatment arms for advanced primary head and neck cancer. 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. Primarily as a result of the Company’s losses incurred to date, the Company’s expected continued future losses, and the uncertainties associated with obtaining regulatory approval and ultimately commercializing its products, management has identified conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern. Management has evaluated the significance of those conditions and has concluded that here is sufficient cash on hand to meet the Company’s budgeted cash requirements, substantial doubt about the Company’s ability to continue as a going concern for more than twelve months from the date of these financial statements has been alleviated. Impact of the 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. |
STOCKHOLDERS EQUITY
STOCKHOLDERS EQUITY | 3 Months Ended |
Dec. 31, 2021 | |
STOCKHOLDERS EQUITY | |
C. STOCKHOLDERS' EQUITY | C. STOCKHOLDERS’ EQUITY Proceeds from the Sale of Common Stock In December 2020, the Company sold 1,000,000shares of common stock at a public offering price of $14.65 per share and received aggregate proceeds of approximately $13.6 million. Equity Compensation Underlying share information for equity compensation plans as of December 31, 2021 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 76,829 N/A 213 Non-Qualified Stock Option Plans 11,787,200 11,204,380 N/A 172,592 Stock Bonus Plans 783,760 N/A 370,691 413,036 Stock Compensation Plans 634,000 N/A 153,195 462,395 Incentive Stock Bonus Plan 640,000 N/A 614,500 25,500 Underlying share information for equity compensation plans as of September 30, 2021 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 76,829 N/A 213 Non-Qualified Stock Option Plans 11,787,200 10,972,880 N/A 410,592 Stock Bonus Plans 783,760 N/A 363,086 420,641 Stock Compensation Plans 634,000 N/A 153,195 462,395 Incentive Stock Bonus Plan 640,000 N/A 614,500 25,500 Stock option activity: Three Months Ended December31, 2021 2020 Options granted 251,000 7,500 Options exercised 6,500 5,300 Options forfeited 13,000 42,166 Options expired - 55 During the quarter ended December 31, 2021, the Company granted 250,000performance-based stock options from the 2020 Non-Qualified Stock Option Plan to officers. Each option entitles the holder to purchase one share of the Company’s common stock at a price of $10.48per share, the fair value on the date of issuance. The stock options will vest 100% upon approval of the first marketing application for any pharmaceutical based upon the Company’s Multikine technology in any of the USA, Canada, UK, Germany, France, Italy, Spain, Japan, or Australia. None of the options will be exercisable before November 19, 2022. All options which have not vested as of November 18, 2031 will be canceled. On the grant date, the options were valued using a Monte Carlo Simulation approach. A Monte Carlo Simulation is a statistical technique that is used to model probabilistic systems and establish the probabilities for a variety of outcomes. However, because attainment of the performance condition cannot be considered probable, no compensation cost is recognized relating to these options as of December 31, 2021. Management will re-assess the probability of achieving the performance condition at each reporting date. Stock-Based Compensation Expense Three months Ended December 31, 2021 2020 Employees $ 3,262,296 $ 3,296,309 Non-employees $ 218,318 $ 248,660 Employee compensation expense includes the expense related to options and restricted stock that is expensed over the 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, 2021: 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 8/18/2022 * Series UU 6/11/2018 93,603 $ 2.80 6/30/2022 * Series X 1/13/2016 120,000 $ 9.25 7/13/2022 * Series Y 2/15/2016 26,000 $ 12.00 8/15/2022 * Series HH 2/23/2017 200 $ 3.13 2/16/2022 * Series AA 8/26/2016 100,000 $ 13.75 2/22/2022 * Series MM 6/22/2017 333,432 $ 1.86 6/22/2022 * Series NN 7/24/2017 205,587 $ 2.52 7/24/2022 2 Series RR 10/30/2017 251,761 $ 1.65 10/30/2022 * Series SS 12/19/2017 200,000 $ 2.09 12/18/2022 * Series TT 2/5/2018 600 $ 2.24 2/5/2023 * Consultants 7/28/2017 - 11/18/2020 15,000 $2.18 $11.61 11/17/2022 - 7/27/2027 * * 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, 2021 September 30, 2021 Series Z warrants $ - $ 64,787 Series AA warrants 1,400 276,035 Series CC warrants - 94,961 Series HH warrants 795 1,597 Total warrant liabilities $ 2,195 $ 437,380 The table below presents the gains on the warrant liabilities for the three months ended December 31: 2021 2020 Series W warrants $ - $ 73,570 Series Z warrants 64,787 278,363 Series ZZ warrants - 51,867 Series AA warrants 274,635 333,808 Series BB warrants - 30,632 Series CC warrants 24,372 164,345 Series HH warrants 802 251 Net gain on warrant liabilities $ 364,596 $ 932,836 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 During the three months ended December 31, 2021, 15,205 Series CC warrants were exercised at an exercise price of $5.00for gross proceeds of $76,000. During the three months ended December 31, 2020, 5,000 Series CC warrants were exercised at an exercise price of $5.00for gross proceeds of $25,000. On December 8, 2021, 640 Series CC warrants, with an exercise price of $5.00, expired. On November 23, 2021, 184,800 Series Z warrants, with an exercise price of $13.75, expired. On August 22, 2021, 16,000 Series BB warrants, with an exercise price of $13.75, expired. On October 28, 2020, 688,930 Series W warrants, with an exercise price of $16.75, expired. 2. Equity Warrants Changes in Equity Warrants During the three months ended December 31, 2021, 4,500 Series NN warrants were exercised at an exercise price of $2.52 for gross proceeds of $11,340. 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. 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 also held by the de Clara Trust. 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 was 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. 3. Options and Shares Issued to Consultants During the three months ended December 31, 2021 and 2020, the Company issued 18,020 and 15,044 shares of restricted common stock, respectively, to consultants for services. The weighted average grant date fair value of the shares issued to consultants was $9.93 and $12.45 per share, respectively, during the three months ended December 31, 2021 and 2020. 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 were 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. As of December 31, 2021 and September 30, 2021, 15,000 options issued to consultants remained outstanding, all of which were issued from the Non-Qualified Stock Option plans. All 15,000 options are vested as of December 31, 2021. During the three months ended December 31, 2021 and 2020, the Company recorded total expense of approximately $218,000 and $249,000, respectively, relating to the share based compensation under these consulting agreements. At December 31, 2021 and September 30, 2021, approximately $234,000and $364,000, respectively, are included in prepaid expenses. 4. Securities Purchase Agreement The Company entered into a Securities Purchase Agreement with Ergomed plc (Ergomed), one of the Company’s CROs 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 and the net proceeds from Ergomed's sales of those shares would reduce outstanding amounts due to Ergomed. Upon issuance, the Company expensed the full value of the shares as other non-operating gain/loss and subsequently offset the gain/loss as amounts were realized through the sale by Ergomed and reduced accounts payable to Ergomed. No sales were made by Ergomed during the three months ended December 31, 2021. As of December 31, 2021, Ergomed had no shares for resale. During the three months ended December 31, 2020, the Company realized approximately $0.1 million through the sale by Ergomed of 9,000 shares of the Company’s common stock and the Company reduced the payables to Ergomed and credited Other Operating Gain by that amount. No shares were issued to Ergomed during the three months ended December 31, 2021 and 2020. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Dec. 31, 2021 | |
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. Assumptions from market participants are used when pricing the asset or liabilities, given there is no readily available market information. 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 Company purchased short-term U.S. Treasury bills during the year ended September 30, 2021 that are classified as trading securities. Quoted market prices were applied to determine the fair value of short-term investments; therefore, they were categorized as Level 1 in the fair value hierarchy. The Treasury bills matured in December 2021 and yielded a weighted average interest rate of 0.10%. As of December 31, 2021 and September 30, 2021, all of the Company’s derivative instruments are classified as Level 3 on the fair value hierarchy. The following sets forth a reconciliation of beginning and ending balances related to fair value measurements using significant unobservable inputs (Level 3) for the three months ended December 31, 2021 and the year ended September 30, 2021: 3 months ended December 31, 2021 12 months ended September 30, 2021 Beginning balance $ 437,380 $ 3,765,613 Issuances - - Exercises (70,589 ) (4,023,091 ) Realized and unrealized (gains) and losses (364,596 ) 694,858 Ending balance $ 2,195 $ 437,380 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. At December 31, 2021, the Company’s Level 3 derivative instruments have a weighted average fair value of $0.02 per share and a weighted average exercise price of $13.73 per share. Fair values were determined using a weighted average risk-free interest rate of 0.06% and weighted average volatility of 79%. The instruments have a weighted average time to maturity of 0.14 years. At September 30, 2021, the Company’s Level 3 derivative instruments have a weighted average fair value of $1.45 per share and a weighted average exercise price of $13.28 per share. Fair values were determined using a weighted average risk-free interest rate of 0.05% and volatility of 109%. The instruments have a weighted average time to maturity of 0.3 years. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Dec. 31, 2021 | |
RELATED PARTY TRANSACTIONS | |
E. RELATED PARTY TRANSACTIONS | E. RELATED PARTY TRANSACTIONS During the quarter ended December 31, 2021, the Company issued officers 250,000 options that vest upon FDA approval of the marketing application. See Note C for more information about the options. On December 7, 2020, the expiration dates of the Series N and Series X warrants held by the de Clara Trust 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, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
F. COMMITMENTS AND CONTINGENCIES | F. COMMITMENTS 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 $35.3 million for Ergomed’s services. This amount is net of Ergomed’s discount of approximately $11.7 million. During the three months ended December 31, 2021 and 2020, the Company recorded, net of Ergomed’s discount, approximately $0.2 million and $0.6 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. The renewal options are not included in the calculation of the right of use asset and lease liability because exercise of those options is not probable. On December 31, 2021 and September 30, 2021, the net book value of the finance lease right of use asset is approximately $12.3 million and $12.7 million, respectively and the balance of the finance lease liability is approximately $13.5 million and $13.8 million, respectively, of which approximately $0.6 million is current in each quarter. 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 the straight-line method over the underlying lease terms. Total cash paid related to finance leases during the three months ended December 31, 2021 and 2020 was approximately $0.6 million and $0.5 million, respectively, of which approximately $0.3 million was for interest in each quarter. As of December 31, 2021, the weighted average discount rate of the Company’s finance leases is 8.45% and the weighted average time to maturity is 6.8 years. In August 2020, the Company entered into an amendment to the San Tomas lease 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 project was finished and the improvements were placed in service in October 2021. Total cost was $11.1 million, of which the landlord agreed to finance $2.4 million. Approximately $1.6 million of the landlord financing was received as of December 31 2021, and the remaining balance is expected to be received in the second quarter of fiscal year 2022. The landlord financing is being repaid through increased lease payments which started in March 2021 and extend over the remaining lease term. The repayment includes a base rent which escalates at 3% each year plus interest that accrues at 13.75% per year. The Company remeasured the lease liability to account for the modified payments using a 8.45% implicit interest rate. The rate was determined using a synthetic credit rating analysis prepared by an outside valuation specialist. Additionally, this financing is considered to be a lease incentive from the landlord and has been included in the calculation of the lease liability as it is realized. The leasehold improvements are recorded in property and equipment, were deemed to be placed in service in October 2021 and are being amortized over the remaining lease term. The Company was required to deposit the equivalent of one year of base rent in accordance with the lease. Under the landlord’s $2.4 million financing arrangement, the Company was required to deposit an additional $0.2 million in March 2021. When the Company meets the minimum cash balance required by the lease, the deposit will be returned to the Company. During the quarter ended December 31, 2021, it was determined that the Company met the minimum cash requirement and the deposits were returned in January 2022. The approximate $1.9 million deposit is included in current assets at December 31, 2021 and non-current assets at September 30, 2021. Approximate future minimum lease payments under finance leases as of December 31, 2021 are as follows: Nine months ending September 30, 2022 $ 1,083,000 Year ending September 30, 2023 2,569,000 2024 2,648,000 2025 2,733,000 2026 2,824,000 2027 2,919,000 Thereafter 3,267,000 Total future minimum lease obligation* 18,043,000 Less imputed interest on finance lease obligations (4,539,000 ) Net present value of finance lease obligations $ 13,504,000 * Amount is net of landlord incentive of approximately $0.8 million expected to be received during the quarter ended March 31, 2022. The Company leases two facilities under operating leases. The lease for the Company’s office headquarters will expire on November 30, 2025. The lease for its research and development laboratory was renewed in September 2021 for an additional ten years and will expire on February 29, 2032. The renewal was considered a modification for accounting purposes and the right of use asset and liability were remeasured as of the date of the renewal. This resulted in an increase of approximately $1.1 million to the operating lease right of use asset and liability. The operating leases include escalating rental payments. The Company is recognizing the related rent expense on a straight-line basis over the terms of the leases. As of December 31, 2021 and September 30, 2021, the net book value of the operating lease right of use assets is approximately $2.0 million and $2.1 million, respectively. As of December 31, 2021 and September 30, 2021, the balance of the operating lease liabilities is approximately $2.1 million. of which approximately $0.1 million, is current in each quarter. The Company incurred lease expense for operating leases of approximately $91,000 and $66,000, respectively, for the three months ended December 31, 2021 and 2020. Total cash paid related to operating leases during the three months ended December 31, 2021 and 2020 was approximately $66,000 and $48,000, respectively. The weighted average discount rate of the Company’s operating leases is 9.11% and the weighted average time to maturity is 9.5 years. As of December 31, 2021, future minimum lease payments on operating leases are as follows: Nine months ending September 30, 2022 $ 243,000 Year ending September 30, 2023 348,000 2024 357,000 2025 366,000 2026 287,000 2027 277,000 Thereafter 1,325,000 Total future minimum lease obligation 3,203,000 Less imputed interest on operating lease obligation (1,081,000 ) Net present value of operating lease obligation $ 2,122,000 |
PATENTS
PATENTS | 3 Months Ended |
Dec. 31, 2021 | |
PATENTS | |
G. PATENTS | G. PATENTS During the three months ended December 31, 2021, the Company recorded approximately $31,000 in patent impairment charges. No patent impairment charges were recorded during the three months ended December 2020. During the three months ended December 31, 2021 and 2020, amortization of patent costs totaled approximately $14,000 and $13,000, respectively. Approximate estimated future amortization expense is as follows: Nine months ending September 30, 2022 $ 35,000 Year ending September 30, 2023 38,000 2024 30,000 2025 28,000 2026 24,000 2027 21,000 Thereafter 72,000 Total $ 248,000 |
LOSS PER COMMON SHARE
LOSS PER COMMON SHARE | 3 Months Ended |
Dec. 31, 2021 | |
LOSS PER COMMON SHARE | |
H. LOSS PER COMMON SHARE | H. LOSS PER COMMON SHARE Basic loss per share is computed by dividing net loss available to common shareholders by the weighted average number of common shares outstanding during the period. For the years presented, the gain on warrant liabilities priced lower than the average market price during the period is excluded from the numerator and the incremental shares, determined using the treasury stock method, are added to the denominator in calculating diluted loss per share. The following tables provide the details of the basic and diluted loss per-share computations: Three months ended December 31, 2021 2020 Loss per share – basic Net loss available to common shareholders - basic $ (8,782,606 ) $ (8,022,643 ) Weighted average shares outstanding - basic 43,077,961 38,670,247 Basic loss per common share $ (0.20 ) $ (0.21 ) Loss per share – diluted Net loss available to common shareholders - basic $ (8,782,606 ) $ (8,022,643 ) Gain on derivatives (1) (25,114 ) (164,073 ) Net loss available to common shareholders - diluted $ (8,807,720 ) $ (8,186,716 ) Weighted average shares outstanding - basic 43,077,961 38,670,247 Incremental shares underlying dilutive - warrants and options (1) 5,459 97,039 Weighted average shares outstanding – diluted 43,083,420 38,767,286 Diluted loss earnings per common share $ (0.20 ) $ (0.21 ) (1) Includes Series CC and HH warrants for the three months ended December 31, 2021 and 2020. In accordance with the contingently issuable shares guidance of FASB ASC Topic 260, Earnings Per Share 2021 2020 Options and Warrants 10,477,966 6,517,160 Unvested Restricted Stock 151,250 302,500 Total 10,629,216 6,819,660 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Dec. 31, 2021 | |
SUBSEQUENT EVENTS | |
I. SUBSEQUENT EVENTS | J. SUBSEQUENT EVENTS The Company has evaluated subsequent events through the date these financial statements were filed and determined there are no subsequent events that require disclosure. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Dec. 31, 2021 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Cash and Cash Equivalents | Cash and Cash Equivalents |
U.S. Treasury Bills | U.S. Treasury Bills – |
Property and Equipment | Property and Equipment |
Patents | Patents |
Leases | Leases – |
Derivative Instruments | Derivative Instruments Accounting for Derivative Instruments and Hedging Activities The Company adopted Accounting Standards Update (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 |
Stock-Based Compensation | Stock-Based Compensation Compensation – Stock 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. These Plans are collectively referred to as the "Plans". All Plans have been approved by the Company’s 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. For options issued with service conditions only, the Company has based its assumption for stock price volatility on the variance of daily closing prices of the Company’s stock. The risk-free interest rate assumption is based on the U.S. Treasury rate at the date of grant with the 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. Restricted stock granted under the Incentive Stock Bonus Plan and options granted under the 2021 and 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 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. |
Research and Development Costs | Research and Development Costs |
Net Loss Per Common Share | Net Loss Per Common Share |
Income Taxes | Income Taxes The Company adopted ASU No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Use of Estimates | Use of Estimates |
New Accounting Pronouncements | New Accounting Pronouncements The Company has considered all 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, 2021 | |
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 Option Plans 138,400 76,829 N/A 213 Non-Qualified Stock Option Plans 11,787,200 11,204,380 N/A 172,592 Stock Bonus Plans 783,760 N/A 370,691 413,036 Stock Compensation Plans 634,000 N/A 153,195 462,395 Incentive Stock Bonus Plan 640,000 N/A 614,500 25,500 Name of Plan Total Shares Reserved Shares Reserved for Outstanding Options Shares Remaining Options/Shares Under Plans Incentive Stock Option Plans 138,400 76,829 N/A 213 Non-Qualified Stock Option Plans 11,787,200 10,972,880 N/A 410,592 Stock Bonus Plans 783,760 N/A 363,086 420,641 Stock Compensation Plans 634,000 N/A 153,195 462,395 Incentive Stock Bonus Plan 640,000 N/A 614,500 25,500 |
Stock option activity | Stock option activity: Three Months Ended December31, 2021 2020 Options granted 251,000 7,500 Options exercised 6,500 5,300 Options forfeited 13,000 42,166 Options expired - 55 |
Stock-based compensation expense | Stock-Based Compensation Expense Three months Ended December 31, 2021 2020 Employees $ 3,262,296 $ 3,296,309 Non-employees $ 218,318 $ 248,660 |
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 8/18/2022 * Series UU 6/11/2018 93,603 $ 2.80 6/30/2022 * Series X 1/13/2016 120,000 $ 9.25 7/13/2022 * Series Y 2/15/2016 26,000 $ 12.00 8/15/2022 * Series HH 2/23/2017 200 $ 3.13 2/16/2022 * Series AA 8/26/2016 100,000 $ 13.75 2/22/2022 * Series MM 6/22/2017 333,432 $ 1.86 6/22/2022 * Series NN 7/24/2017 205,587 $ 2.52 7/24/2022 2 Series RR 10/30/2017 251,761 $ 1.65 10/30/2022 * Series SS 12/19/2017 200,000 $ 2.09 12/18/2022 * Series TT 2/5/2018 600 $ 2.24 2/5/2023 * Consultants 7/28/2017 - 11/18/2020 15,000 $2.18 $11.61 11/17/2022 - 7/27/2027 * |
Schedule of fair value of warrant liabilites | December 31, 2021 September 30, 2021 Series Z warrants $ - $ 64,787 Series AA warrants 1,400 276,035 Series CC warrants - 94,961 Series HH warrants 795 1,597 Total warrant liabilities $ 2,195 $ 437,380 |
Schedule of gain and (losses) on derivative liabilities | 2021 2020 Series W warrants $ - $ 73,570 Series Z warrants 64,787 278,363 Series ZZ warrants - 51,867 Series AA warrants 274,635 333,808 Series BB warrants - 30,632 Series CC warrants 24,372 164,345 Series HH warrants 802 251 Net gain on warrant liabilities $ 364,596 $ 932,836 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
FAIR VALUE MEASUREMENTS | |
Reconciliation of beginning and ending balances related to fair value measurements using significant unobservable inputs (Level 3) | 3 months ended December 31, 2021 12 months ended September 30, 2021 Beginning balance $ 437,380 $ 3,765,613 Issuances - - Exercises (70,589 ) (4,023,091 ) Realized and unrealized (gains) and losses (364,596 ) 694,858 Ending balance $ 2,195 $ 437,380 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
COMMITMENTS AND CONTINGENCIES | |
Schedule of future minimum payments under finance leases | Nine months ending September 30, 2022 $ 1,083,000 Year ending September 30, 2023 2,569,000 2024 2,648,000 2025 2,733,000 2026 2,824,000 2027 2,919,000 Thereafter 3,267,000 Total future minimum lease obligation* 18,043,000 Less imputed interest on finance lease obligations (4,539,000 ) Net present value of finance lease obligations $ 13,504,000 |
Schedule of future minimum payments under operating leases | Nine months ending September 30, 2022 $ 243,000 Year ending September 30, 2023 348,000 2024 357,000 2025 366,000 2026 287,000 2027 277,000 Thereafter 1,325,000 Total future minimum lease obligation 3,203,000 Less imputed interest on operating lease obligation (1,081,000 ) Net present value of operating lease obligation $ 2,122,000 |
PATENTS (Tables)
PATENTS (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
PATENTS | |
Schedule of total estimated future amortization | Nine months ending September 30, 2022 $ 35,000 Year ending September 30, 2023 38,000 2024 30,000 2025 28,000 2026 24,000 2027 21,000 Thereafter 72,000 Total $ 248,000 |
LOSS PER COMMON SHARE (Tables)
LOSS PER COMMON SHARE (Tables) | 3 Months Ended |
Dec. 31, 2021 | |
LOSS PER COMMON SHARE | |
Schedule of reconciliation of the numerators and denominators of the basic and diluted per-share computations | Three months ended December 31, 2021 2020 Loss per share – basic Net loss available to common shareholders - basic $ (8,782,606 ) $ (8,022,643 ) Weighted average shares outstanding - basic 43,077,961 38,670,247 Basic loss per common share $ (0.20 ) $ (0.21 ) Loss per share – diluted Net loss available to common shareholders - basic $ (8,782,606 ) $ (8,022,643 ) Gain on derivatives (1) (25,114 ) (164,073 ) Net loss available to common shareholders - diluted $ (8,807,720 ) $ (8,186,716 ) Weighted average shares outstanding - basic 43,077,961 38,670,247 Incremental shares underlying dilutive - warrants and options (1) 5,459 97,039 Weighted average shares outstanding – diluted 43,083,420 38,767,286 Diluted loss earnings per common share $ (0.20 ) $ (0.21 ) 2021 2020 Options and Warrants 10,477,966 6,517,160 Unvested Restricted Stock 151,250 302,500 Total 10,629,216 6,819,660 |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) | 3 Months Ended |
Dec. 31, 2021 | |
Patents [Member] | |
Patent useful life | 17 years |
STOCKHOLDERS EQUITY (Details)
STOCKHOLDERS EQUITY (Details) - shares | Dec. 31, 2021 | Sep. 30, 2021 |
Incentive Stock Option Plans [Member] | ||
Total shares reserved under plans | 138,400 | 138,400 |
Shares reserved for outstanding options | 76,829 | 76,829 |
Remaining options/shares under plans | 213 | 213 |
Non-Qualified Stock Option Plans [Member] | ||
Total shares reserved under plans | 11,787,200 | 11,787,200 |
Shares reserved for outstanding options | 11,204,380 | 10,972,880 |
Remaining options/shares under plans | 172,592 | 410,592 |
Stock Bonus Plans [Member] | ||
Total shares reserved under plans | 783,760 | 783,760 |
Remaining options/shares under plans | 413,036 | 420,641 |
Shares issued | 370,691 | 363,086 |
Stock Compensation Plan [Member] | ||
Total shares reserved under plans | 634,000 | 634,000 |
Remaining options/shares under plans | 462,395 | 462,395 |
Shares issued | 153,195 | 153,195 |
Incentive Stock Bonus Plan [Member] | ||
Total shares reserved under plans | 640,000 | 640,000 |
Remaining options/shares under plans | 25,500 | 25,500 |
Shares issued | 614,500 | 614,500 |
STOCKHOLDERS EQUITY (Details 1)
STOCKHOLDERS EQUITY (Details 1) - shares | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
STOCKHOLDERS EQUITY | ||
Options granted | 251,000 | 7,500 |
Options exercised | 6,500 | 5,300 |
Options forfeited | 13,000 | 42,166 |
Options expired | 0 | 55 |
STOCKHOLDERS EQUITY (Details 2)
STOCKHOLDERS EQUITY (Details 2) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
STOCKHOLDERS EQUITY | ||
Employees stock based compensation expense | $ 3,262,296 | $ 3,296,309 |
Non- Employees stock based compensation expense | $ 218,318 | $ 248,660 |
STOCKHOLDERS EQUITY (Details 3)
STOCKHOLDERS EQUITY (Details 3) | 3 Months Ended |
Dec. 31, 2021$ / sharesshares | |
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 |
Series N [Member] | |
Shares issuable upon exercise of warrant/options | shares | 85,339 |
Exercise price | $ 3 |
Issue date | 8/18/2008 |
Expiration date | 8/18/2022 |
Series UU [Member] | |
Shares issuable upon exercise of warrant/options | shares | 93,603 |
Exercise price | $ 2.80 |
Issue date | 6/11/2018 |
Expiration date | 6/30/2022 |
Series X [Member] | |
Shares issuable upon exercise of warrant/options | shares | 120,000 |
Exercise price | $ 9.25 |
Issue date | 1/13/2016 |
Expiration date | 7/13/2022 |
Series Y [Member] | |
Shares issuable upon exercise of warrant/options | shares | 26,000 |
Exercise price | $ 12 |
Issue date | 2/15/2016 |
Expiration date | 8/15/2022 |
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 | 100,000 |
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 | 333,432 |
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 | 205,587 |
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 | 251,761 |
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 | 200,000 |
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 | 600 |
Exercise price | $ 2.24 |
Issue date | 2/5/2018 |
Expiration date | 2/5/2023 |
STOCKHOLDERS EQUITY (Details 4)
STOCKHOLDERS EQUITY (Details 4) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
STOCKHOLDERS EQUITY | ||
Series Z warrants | $ 0 | $ 64,787 |
Series AA warrants | 1,400 | 276,035 |
Series CC warrants | 0 | 94,961 |
Series HH warrants | 795 | 1,597 |
Total warrant liabilities | 2,195 | 437,380 |
Gains on Series W warrants | 0 | 73,570 |
Gains on Series Z warrants | 64,787 | 278,363 |
Gains on Series ZZ warrants | 0 | 51,867 |
Gains on Series AA warrants | 274,635 | 333,808 |
Gains on Series BB warrants | 0 | 30,632 |
Gains on Series CC warrants | 24,372 | 164,345 |
Gains on Series HH warrants | 802 | 251 |
Net gain on warrant liabilities | $ 364,596 | $ 932,836 |
STOCKHOLDERS EQUITY (Details Na
STOCKHOLDERS EQUITY (Details Narrative) - USD ($) | Dec. 08, 2021 | Nov. 23, 2021 | Aug. 22, 2021 | Dec. 07, 2020 | Oct. 28, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 |
Realized through sale of shares | $ 100,000 | |||||||
Weighted average grant date fair value | $ 5.65 | |||||||
Fair value of stock option | $ 28,000 | |||||||
Proceeds from issuance of common stock | $ 13,559,500 | |||||||
Consulting Agreements [Member] | ||||||||
Total expense inclued prepaid expenses | 234,000 | $ 364,000 | ||||||
Total expense | $ 218,000 | $ 249,000 | ||||||
Non-Qualified Stock Option Plans [Member] | ||||||||
Grant performance-based stock options | 250,000 | |||||||
Common stock price | $ 10.48 | |||||||
Stock options vest | 100.00% | |||||||
Series W Warrants [Member] | ||||||||
Warrants exercised | 688,930 | |||||||
Common stock price per share | $ 16.75 | |||||||
Consultants [Member] | ||||||||
Expiration date | November 17, 2022 | |||||||
Options issued | 5,000 | |||||||
Consultants One [Member] | ||||||||
Options issued | 15,000 | |||||||
Non-Qualified Stock Option shares vest | 15,000 | |||||||
Restricted Stock [Member] | Consultants [Member] | ||||||||
Weighted average grant date fair value | $ 9.93 | $ 12.45 | ||||||
Common stock issued for service, shares | 18,020 | 15,044 | ||||||
December 2020 [Member] | ||||||||
Common stock shares | 1,000,000 | |||||||
Offering price | $ 14.65 | |||||||
Proceeds from issuance of common stock | $ 13,600,000 | |||||||
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 | 7/13/2022 | |||||||
Series Y [Member] | ||||||||
Incremental cost | $ 41,000 | |||||||
Expiration date | 8/15/2022 | |||||||
Series NN [Member] | ||||||||
Warrants exercised | 4,500 | |||||||
Proceeds from warrants exercised | $ 11,340 | |||||||
Exercise price of warrants exercised | $ 2.52 | |||||||
Expiration date | 7/24/2022 | |||||||
Series TT [Member] | ||||||||
Warrants exercised | 10,000 | |||||||
Proceeds from warrants exercised | $ 22,400 | |||||||
Exercise price of warrants exercised | $ 2.24 | |||||||
Expiration date | 2/5/2023 | |||||||
Series CC [Member] | ||||||||
Proceeds from warrants exercised | $ 76,000 | $ 25,000 | ||||||
Exercise price per share | $ 5 | $ 5 | $ 5 | |||||
Warrants expired during period | 640 | 15,205 | 5,000 | |||||
Series Z [Member] | ||||||||
Warrants exercised | 184,800 | |||||||
Common stock price per share | $ 13.75 | |||||||
Series BB [Member] | ||||||||
Warrants expired during period | 16,000 | |||||||
Common stock price per share | $ 13.75 | |||||||
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 | |||||||
Series UU warrants [Member] | ||||||||
Incremental cost | $ 192 | |||||||
Expiration date description | the expiration date of Series UU warrants was extended six months from December 31, 2020 to June 30, 2021 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Sep. 30, 2021 | |
FAIR VALUE MEASUREMENTS | ||
Beginning balance | $ 437,380 | $ 3,765,613 |
Issuances | 0 | 0 |
Exercises | (70,589) | (4,023,091) |
Realized and unrealized (gains) and losses | (364,596) | 694,858 |
Ending balance | $ 2,195 | $ 437,380 |
FAIR VALUE MEASUREMENTS (Deta_2
FAIR VALUE MEASUREMENTS (Details Narrative) - $ / shares | 3 Months Ended | 12 Months Ended |
Dec. 31, 2021 | Sep. 30, 2021 | |
Fair Value, Inputs, Level 3 [Member] | ||
Weighted average risk free interest rate | 0.06% | 0.05% |
Weighted average fair value, Derivative instruments | $ 0.02 | $ 1.45 |
Weighted average exercise price, Derivative instruments | $ 13.73 | $ 13.28 |
Volatility rate | 79.00% | 109.00% |
Weighted average time to maturity year | 3 months 18 days | 1 month 20 days |
Fair Value Inputs Level 1 (Level 1) | ||
Weighted average risk free interest rate | 0.10% |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative ) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 07, 2020 | |
Officer [Member] | ||
Options issued | 250,000 | |
Series UU warrants [Member] | ||
Warrants issued | 93,603 | |
Interest expense | $ 192 | |
Series X Warrants [Member] | ||
Deemed dividend after net loss to arrive at net loss available common shareholders | $ 86,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES (Details) | Dec. 31, 2021USD ($) |
COMMITMENTS AND CONTINGENCIES | |
Nine months ending September 30, 2022 | $ 1,083,000 |
2023 | 2,569,000 |
2024 | 2,648,000 |
2025 | 2,733,000 |
2026 | 2,824,000 |
2027 | 2,919,000 |
Thereafter | 3,267,000 |
Total future minimum finance lease obligation | 18,043,000 |
Less: imputed interest on financing lease obligation | (4,539,000) |
Net present value of lease finance lease obligations | $ 13,504,000 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES (Details 1) | Dec. 31, 2021USD ($) |
COMMITMENTS AND CONTINGENCIES | |
Nine months ending September 30, 2022 | $ 243,000 |
2023 | 348,000 |
2024 | 357,000 |
2025 | 366,000 |
2026 | 287,000 |
2027 | 277,000 |
Thereafter | 1,325,000 |
Total future minimum lease obligation | 3,203,000 |
Less imputed interest on operating lease obligation | (1,081,000) |
Net present value of operating lease obligation | $ 2,122,000 |
COMMITMENTS AND CONTINGENCIES_4
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | 1 Months Ended | 3 Months Ended | |||
Aug. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2021 | Mar. 31, 2021 | |
Weighted average discount rate | 8.45% | ||||
Weighted average discount rate operating lease | 9.11% | ||||
Maturity years | 6 years 9 months 18 days | ||||
Operating lease maturity years | 9 years 6 months | ||||
Research and development expenses | $ 35,300,000 | ||||
Net of discount | 11,700,000 | ||||
Finance lease obligations, net of current portion | $ 1,900,000 | $ 200,000 | |||
Ergomed [Member] | |||||
Research and development expenses | 200,000 | 600,000 | |||
Clinical service trial | $ 12,000,000 | ||||
Weighted average time to maturity | 7 years 1 month 6 days | ||||
Landlord [Member] | |||||
Interest rate | 0.0845% | ||||
Lease description | The repayment includes a base rent which escalates at 3% each year plus interest that accrues at 13.75% per year. | ||||
Financing arrangement | $ 11,100,000 | ||||
Payments made by landlord | $ 2,400,000 | $ 1,600,000 | |||
October 1, 2019 [Member] | Transaction One [Member] | |||||
Weighted average discount rate | 8.45% | ||||
Current balance | $ 600,000 | $ 600,000 | |||
Net book value of the finance lease right of use asset | 12,300,000 | 12,700,000 | |||
Balance of the finance lease liability | 13,500,000 | 13,800,000 | |||
Cash paid related to finance leases | 600,000 | 500,000 | |||
Cash paid related to finance leases interest | 300,000 | 300,000 | |||
October 1, 2019 [Member] | Transaction Two [Member] | |||||
Current balance | 100,000 | 100,000 | |||
Cash paid related to operating leases | 6,600,000,000 | 4,800,000,000 | |||
Net book value operating lease right of use assets | 2,000,000 | 2,100,000 | |||
Operating lease - liability | 2,100,000 | $ 2,100,000 | |||
Operating lease expense | $ 91,000 | $ 66,000 |
PATENTS (Details)
PATENTS (Details) | Dec. 31, 2021USD ($) |
PATENTS | |
Nine months ending September 30, 2022 | $ 35,000 |
2023 | 38,000 |
2024 | 30,000 |
2025 | 28,000 |
2026 | 24,000 |
2027 | 21,000 |
Thereafter | 72,000 |
Total | $ 248,000 |
PATENTS (Details Narrative)
PATENTS (Details Narrative) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
PATENTS | ||
Patent impairment charges | $ 31,000 | |
Amortization of patent costs | $ 14,000 | $ 13,000 |
LOSS PER COMMON SHARE (Details)
LOSS PER COMMON SHARE (Details) - USD ($) | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
LOSS PER COMMON SHARE | ||
Net loss available to common shareholders - basic | $ (8,782,606) | $ (8,022,643) |
Weighted average shares outstanding - basic | 43,077,961 | 38,670,247 |
Basic loss per common share | $ (0.20) | $ (0.21) |
Loss per share- diluted | ||
Net loss available to common shareholders -basic | $ (8,782,606) | $ (8,022,643) |
Gain on derivatives | (25,114) | (164,073) |
Net loss available to common shareholders - diluted | $ (8,807,720) | $ (8,186,716) |
Weighted average shares outstanding - basic | 43,077,961 | 38,670,247 |
Incremental shares underlying dilutive - warrants and options | 5,459 | 97,039 |
Weighted average shares outstanding - diluted | 43,083,420 | 38,767,286 |
Diluted loss earnings per common share | $ (0.20) | $ (0.21) |
LOSS PER COMMON SHARE (Details
LOSS PER COMMON SHARE (Details 1) - shares | 3 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Antidilutive securities | 10,629,216 | 6,819,660 |
Options and Warrants | ||
Antidilutive securities | 10,477,966 | 6,517,160 |
Unvested Restricted Stock [Member] | ||
Antidilutive securities | 151,250 | 302,500 |