Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2015 | Jul. 31, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | CORTEX PHARMACEUTICALS INC/DE/ | |
Entity Central Index Key | 849,636 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2015 | |
Amendment Flag | true | |
Amendment Description | Note on Restatement: The Company is amending its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2015 to restate its condensed consolidated financial statements as of and for the three months ended March 31, 2015, and to amend the related footnotes and other disclosures included therein, to record charges from a vendor for services rendered during the three months ended March 31, 2015 that were inadvertently omitted from such financial statements, in part as a result of the delayed receipt of information and invoicing from the vendor (see Note 1 Restatement). This Amendment No. 1 to the Companys Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2015 does not purport to, and does not, update any other disclosures or information originally contained therein. except for certain limited disclosures related to the Companys research and development activities and the subsequent events disclosures contained in Note 10 to the Condensed Consolidated Financial Statements for the three months ended March 31, 2015. | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 413,976,852 | |
Trading Symbol | CORX | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,015 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 154,152 | $ 162,752 |
Grant receivable | 28,583 | 48,000 |
Capitalized financing Costs | 77,030 | 85,702 |
Prepaid insurance, including current portion of long-term prepaid insurance of $14,945 at March 31, 2015 and December 31, 2014 | 58,824 | 24,219 |
Total current assets | 318,589 | 320,673 |
Equipment, net of accumulated depreciation of $3,561 and $1,659 at March 31, 2015 and December 31, 2014, respectively | 17,336 | 16,741 |
Long-term prepaid insurance, net of current portion of $14,945 at March 31, 2015 and December 31, 2014 | 59,158 | 62,894 |
Total assets | 395,083 | 400,308 |
Current liabilities: | ||
Accounts payable and accrued expenses, including $95,000 and $108,375 payable to related parties at March 31, 2015 and December 31, 2014, respectively | 2,173,254 | 1,845,875 |
Accrued compensation and related expenses | 18,500 | 144,000 |
Unearned grant revenue | 12,382 | 34,333 |
10% convertible notes payable, including accrued interest of $16,715 and $4,093, net of unamortized discount of $367,354 and $323,350, at March 31, 2015 and December 31, 2014, respectively | 228,861 | 50,243 |
Note payable to related party, including accrued interest of $134,611 and $122,618 at March 31, 2015 and December 31, 2014, respectively | 534,060 | $ 526,257 |
Other short-term note payable, including accrued interest of $77 | 36,202 | |
Total current liabilities | 3,003,259 | $ 2,600,708 |
Commitments and contingencies (Note 9) | ||
Stockholders' deficiency: | ||
Common stock, $0.001 par value; shares authorized: 1,400,000,000; shares issued and outstanding: 240,819,176 and 232,145,326 at March 31, 2015 and December 31, 2014, respectively | 240,819 | $ 232,145 |
Additional paid-in capital | 139,320,936 | 138,984,110 |
Accumulated deficit | (143,042,245) | (142,311,095) |
Total stockholders' deficiency | (2,608,176) | (2,200,400) |
Total liabilities and stockholders' deficiency | 395,083 | 400,308 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' deficiency: | ||
Preferred stock value | 21,703 | 21,703 |
Series G 1.5% Cumulative Mandatorily Convertible Preferred Stock [Member] | ||
Stockholders' deficiency: | ||
Preferred stock value | $ 850,611 | $ 872,737 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Mar. 31, 2015 | Dec. 31, 2014 |
Long term prepaid insurance current portion | $ 14,945 | $ 14,945 |
Equipment, accumulated depreciation | 3,561 | 1,659 |
Accounts payable and accrued expenses to related party | $ 95,000 | $ 108,375 |
Percentage of convertible notes payable | 10.00% | 10.00% |
Accrued interest | $ 16,715 | $ 4,093 |
Unamortized discount | 367,354 | 323,350 |
Notes payable to related party | 134,611 | $ 122,618 |
Short-term note payable | $ 77 | |
Preferred stock, par value | $ 0.0001 | |
Preferred stock, shares authorized | 5,000,000 | |
Common stock shares issuable upon conversion of series G | 264,465,728 | |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,400,000,000 | 1,400,000,000 |
Common stock, shares issued | 240,819,176 | 232,145,326 |
Common stock, shares outstanding | 240,819,176 | 232,145,326 |
Series B Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, liquidation preference per share | $ 0.6667 | $ 0.6667 |
Preferred stock, liquidation preference value | $ 25,001 | $ 25,001 |
Preferred stock, shares authorized | 37,500 | 37,500 |
Preferred stock, shares issued | 37,500 | 37,500 |
Preferred stock, shares outstanding | 37,500 | 37,500 |
Preferred stock shares issuable upon conversion, Per share | $ 0.09812 | $ 0.09812 |
Common stock shares issuable upon conversion of series G | 3,679 | 3,679 |
Series G 1.5% Cumulative Mandatorily Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.001 | |
Preferred stock, liquidation preference per share | $ 1,000 | |
Preferred stock, liquidation preference value | $ 1,000 | |
Preferred stock, shares authorized | 1,700 | 1,700 |
Preferred stock, shares issued | 850.6 | 872.7 |
Preferred stock, shares outstanding | 850.6 | 872.7 |
Percentage of dividend on convertible preferred stock | 1.50% | 1.50% |
Preferred stock, aggregate liquidation preference value including dividend | $ 850,611 | $ 872,737 |
Number of common shares issuable for conversion of Series G per share | 303,030.3 | |
Common stock shares issuable upon conversion in series G | 257,760,939 | 264,465,728 |
Common stock issuable upon conversion due to 1.5% dividend | 3,973,063 | 3,102,094 |
Amount of preferred stock dividends | $ 13,111 | $ 10,237 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Income Statement [Abstract] | ||
Grant revenues | $ 74,534 | |
Operating expenses: | ||
General and administrative, including $1,960,000 to related parties for the three months ended March 31, 2014 | 229,900 | $ 2,348,107 |
Research and development, including $76,500 to a related party for the three months ended March 31, 2015 | 440,792 | 64,089 |
Total operating expenses | 670,692 | 2,412,196 |
Loss from operations | (596,158) | (2,412,196) |
Gain on settlements with former management | 92,550 | 1,038,270 |
Interest expense, including $11,993 and $12,046 to related parties for the three months ended March 31, 2015 and 2014, respectively | (228,534) | (13,061) |
Foreign currency transaction gain | 4,190 | 6,277 |
Net loss | $ (727,952) | (1,380,710) |
Adjustments related to Series G 1.5% Convertible Preferred Stock: | ||
Amortization of deemed dividend on Series G 1.5% Convertible Preferred Stock | (1,209,970) | |
Dividend on Series G 1.5% Convertible Preferred Stock | $ (3,198) | (408) |
Net loss attributable to common stockholders | $ (731,150) | $ (2,591,088) |
Net loss per common share - basic and diluted | $ 0 | $ (.02) |
Weighted average common shares outstanding - basic and diluted | 238,705,800 | 152,274,889 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Operations (Parenthetical) - USD ($) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
General and administrative expense to related parties | $ 1,960,000 | |
Research and development expenses to related parties | $ 76,500 | |
Interest expense to related parties | $ 11,993 | $ 12,046 |
Percentage of dividend on convertible preferred stock | 1.50% | |
Series G 1.5% Convertible Preferred Stock [Member] | ||
Percentage of dividend on convertible preferred stock | 1.50% |
Condensed Consolidated Stateme6
Condensed Consolidated Statement of Stockholders' Deficiency (Unaudited) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2015 | Dec. 31, 2014 | |
Series B Convertible Preferred Stock [Member] | ||
Balance beginning | $ 21,703 | |
Balance beginning, shares | 37,500 | |
Balance ending | $ 21,703 | $ 21,703 |
Balance ending, shares | 37,500 | 37,500 |
Series G 1.5% Convertible Preferred Stock [Member] | ||
Balance beginning | $ 872,737 | |
Balance beginning, shares | 872.7 | |
Conversion of Series G 1.5% Convertible Preferred Stock | $ (25,324) | |
Conversion of Series G 1.5% Convertible Preferred Stock, shares | (25.3) | |
Dividend on Series G 1.5% Convertible Preferred Stock | $ 3,198 | |
Dividend on Series G 1.5% Convertible Preferred Stock, shares | 3.2 | |
Balance ending | $ 850,611 | $ 872,737 |
Balance ending, shares | 850.6 | 872.7 |
Common Stock [Member] | ||
Balance beginning | $ 232,145 | |
Balance beginning, shares | 232,145,326 | |
Conversion of Series G 1.5% Convertible Preferred Stock | $ 7,674 | |
Conversion of Series G 1.5% Convertible Preferred Stock, shares | 7,673,850 | |
Common stock issued as compensation | $ 1,000 | |
Common stock issued as compensation, shares | 1,000,000 | |
Balance ending | $ 240,819 | $ 232,145 |
Balance ending, shares | 240,819,176 | 232,145,326 |
Additional Paid-In Capital [Member] | ||
Balance beginning | $ 138,984,110 | |
Conversion of Series G 1.5% Convertible Preferred Stock | 17,650 | |
Common stock issued as compensation | 71,000 | |
Fair value of common stock options issued in connection with settlements with former management | 25,450 | |
Fair value of common stock warrants issued to investors in connection with the convertible note and warrant financing | 112,557 | |
Fair value of common stock warrants issued to finders in connection with the convertible note and warrant financing | 12,726 | |
Fair value of beneficial conversion feature of convertible notes payable issued to investors in connection with the convertible note and warrant financing | 97,443 | |
Balance ending | 139,320,936 | $ 138,984,110 |
Accumulated Deficit [Member] | ||
Balance beginning | (142,311,095) | |
Dividend on Series G 1.5% Convertible Preferred Stock | (3,198) | |
Net loss | (727,952) | |
Balance ending | (143,042,245) | (142,311,095) |
Balance beginning | $ (2,200,400) | |
Conversion of Series G 1.5% Convertible Preferred Stock | ||
Common stock issued as compensation | $ 72,000 | |
Fair value of common stock options issued in connection with settlements with former management | 25,450 | |
Fair value of common stock warrants issued to investors in connection with the convertible note and warrant financing | 112,557 | |
Fair value of common stock warrants issued to finders in connection with the convertible note and warrant financing | 12,726 | |
Fair value of beneficial conversion feature of convertible notes payable issued to investors in connection with the convertible note and warrant financing | $ 97,443 | |
Dividend on Series G 1.5% Convertible Preferred Stock | ||
Net loss | $ (727,952) | (2,707,535) |
Balance ending | $ (2,608,176) | $ (2,200,400) |
Condensed Consolidated Stateme7
Condensed Consolidated Statement of Stockholders' Deficiency (Parenthetical) | 3 Months Ended |
Mar. 31, 2015 | |
Percentage of dividend on convertible preferred stock | 1.50% |
Series G 1.5% Convertible Preferred Stock [Member] | |
Percentage of dividend on convertible preferred stock | 1.50% |
Condensed Consolidated Stateme8
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Cash flows from operating activities: | ||
Net loss | $ (727,952) | $ (1,380,710) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation expense | 1,902 | $ 17 |
Amortization of discounts related to convertible notes payable Investor warrants | 82,677 | |
Amortization of discounts related to convertible notes payable Beneficial conversion feature | 83,320 | |
Amortization of capitalized financing costs | 37,098 | |
Gain on settlements with former management | $ (92,550) | $ (1,038,270) |
Stock-based compensation expense included in - | ||
General and administrative expenses | $ 2,280,000 | |
Research and development expenses | $ 72,000 | |
Foreign currency transaction (gain) loss | (4,190) | $ (6,277) |
(Increase) decrease in - | ||
Grant receivable | 19,417 | |
Prepaid insurance | 5,256 | $ (124,998) |
Increase (decrease) in - | ||
Accounts payable and accrued expenses | 327,379 | 61,613 |
Accrued compensation and related expenses | (7,500) | (118,084) |
Accrued interest payable | 24,691 | $ 12,950 |
Unearned grant revenue | (21,951) | |
Net cash used in operating activities | (200,403) | $ (313,759) |
Cash flows from investing activities: | ||
Purchases of equipment | (2,497) | (1,925) |
Net cash used in investing activities | $ (2,497) | (1,925) |
Cash flows from financing activities: | ||
Proceeds from sale of Series G 1.5% Convertible Preferred Stock | $ 753,220 | |
Proceeds from convertible note and warrant financing | $ 210,000 | |
Proceeds from issuance of notes payable to Chairman | $ 75,000 | |
Repayment of notes payable to Chairman | $ (150,000) | |
Cash payments made for deferred costs incurred in connection with convertible note and warrant financing | $ (15,700) | |
Cash payments made for costs incurred in connection with sale of Series G 1.5% Convertible Preferred Stock | $ (64,956) | |
Net cash provided by financing activities | $ 194,300 | 613,264 |
Cash and cash equivalents: | ||
Net increase (decrease) | (8,600) | 297,580 |
Balance at beginning of period | 162,752 | 14,352 |
Balance at end of period | 154,152 | $ 311,932 |
Cash paid for - | ||
Interest | $ 750 | |
Income taxes | ||
Non-cash financing activities: | ||
Amortization of deemed dividend on Series G 1.5% Convertible Preferred Stock | $ 1,209,970 | |
Dividend on Series G 1.5% Convertible Preferred Stock | $ 3,198 | $ 408 |
Short-term note payable issued in connection with the procurement of director and officer insurance | 36,125 | |
Stated value of Series G 1.5% Convertible Preferred Stock converted into common stock | 25,324 | |
Fair value of common stock options issued in connection with settlements with former management | 25,450 | $ 179,910 |
Fair value of common stock warrants issued to investors in connection with the convertible note and warrant financing | 112,557 | |
Fair value of common stock warrants issued to finders in connection with the convertible note and warrant financing | 12,726 | |
Fair value of beneficial conversion feature of convertible notes payable issued to investors in connection with the convertible note and warrant financing | $ 97,443 | |
Fair value of common stock warrants issued to placement agents and selected dealers in connection with the sale of Series G 1.5% Convertible Preferred Stock | $ 443,848 | |
Deferred financing costs transferred to additional paid-in capital in connection with sale of Series G 1.5% Convertible Preferred Stock | $ 35,120 |
Condensed Consolidated Stateme9
Condensed Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) | 3 Months Ended |
Mar. 31, 2015 | |
Percentage of dividend on convertible preferred stock | 1.50% |
Series G 1.5% Convertible Preferred Stock [Member] | |
Percentage of dividend on convertible preferred stock | 1.50% |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | 1. Basis of Presentation The condensed consolidated financial statements of Cortex Pharmaceuticals, Inc. (Cortex) and its wholly-owned subsidiary, Pier Pharmaceuticals, Inc. (Pier) (collectively referred to herein as the Company, unless the context indicates otherwise), at March 31, 2015 and for the three months ended March 31, 2015 and 2014, are unaudited. In the opinion of management, all adjustments (including normal recurring adjustments) have been made that are necessary to present fairly the consolidated financial position of the Company as of March 31, 2015, the results of its consolidated operations for the three months ended March 31, 2015 and 2014, and its consolidated cash flows for the three months ended March 31, 2015 and 2014. Consolidated operating results for the interim periods presented are not necessarily indicative of the results to be expected for a full fiscal year. The consolidated balance sheet at December 31, 2014 has been derived from the Companys audited consolidated financial statements at such date. The condensed consolidated financial statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the SEC). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been omitted pursuant to such rules and regulations. These consolidated financial statements should be read in conjunction with the consolidated financial statements and other information included in the Companys Annual Report on Form 10-K for the fiscal year ended December 31, 2014, as filed with the SEC. Restatement as of and for the Three Months Ended March 31, 2015 In July 2015, the Company determined that it had inadvertently omitted to record charges from, and a related liability to, a third party vendor for research and development services aggregating $129,821 during the three months ended March 31, 2015, in part as a result of the delayed receipt of information and invoicing from the vendor. Accordingly, the Company has amended its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2015 to restate its condensed consolidated financial statements as of and for the three months ended March 31, 2015, and to amend the related footnotes and other disclosures included therein. A summary of the accounting impact of this matter on the Companys condensed consolidated financial statements as of and for the three months ended March 31, 2015 is presented below. March 31, 2015 As Reported As Restated Condensed Consolidated Balance Sheet: Assets: Total current assets $ 318,589 $ 318,589 Total assets $ 395,083 $ 395,083 Liabilities and Stockholders Deficiency: Total current liabilities $ 2,873,439 $ 3,003,259 Total liabilities 2,873,439 3,003,259 Total stockholders deficiency (2,478,356 ) (2,608,176 ) Total liabilities and stockholders deficiency $ 395,083 $ 395,083 Three Months Ended March 31, 2015 As Reported As Restated Condensed Consolidated Statement of Operations: Revenues $ 74,534 $ 74,534 Total operating expenses 540,872 670,692 Loss from operations (466,338 ) (596,158 ) Net loss (598,132 ) (727,952 ) Net loss attributable to common stockholders (601,330 ) (731,150 ) Net loss per common share basic and diluted $ (0.00 ) $ (0.00 ) Three Months Ended March 31, 2015 As Reported As Restated Condensed Consolidated Statement of Cash Flows: Net cash used in operating activities $ (200,403 ) $ (200,403 ) Net cash used in investing activities (2,497 ) (2,497 ) Net cash provided by financing activities 194,300 194,300 Net increase (decrease) in cash (8,600 ) (8,600 ) Balance at beginning of period 162,752 162,752 Balance at end of period $ 154,152 $ 154,152 |
Organization and Business Opera
Organization and Business Operations | 3 Months Ended |
Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business Operations | 2. Organization and Business Operations Business Cortex was formed in 1987 to engage in the discovery, development and commercialization of innovative pharmaceuticals for the treatment of neurological and psychiatric disorders. In 2011, prior management conducted a re-evaluation of Cortexs strategic focus and determined that clinical development in the area of respiratory disorders, particularly respiratory depression and sleep apnea, provided the most cost-effective opportunities for potential rapid development and commercialization of Cortexs compounds. Accordingly, Cortex narrowed its clinical focus at that time and abandoned other avenues of scientific inquiry. This re-evaluation provided the impetus for Cortexs acquisition of Pier in August 2012. New management was appointed in March 2013 and has continued to implement this strategic focus, including seeking the capital to fund such efforts. As a result of the Companys scientific discoveries and the acquisition of strategic, exclusive license agreements, management believes that the Company is now a leader in the discovery and development of innovative pharmaceuticals for the treatment of respiratory disorders. Since its formation in 1987, Cortex has been engaged in the research and clinical development of a class of compounds referred to as ampakines. By acting as positive allosteric modulators of AMPA glutamate receptors, ampakines increase the excitatory effects of the neurotransmitter glutamate. Preclinical research suggested that these ampakines might have therapeutic potential for the treatment of certain respiratory disorders, as well as cognitive disorders, depression, attention deficit disorder and schizophrenia. Cortex owns patents and patent applications for certain families of chemical compounds, including ampakines, which claim the chemical structures and their use in the treatment of various disorders. These patents cover, among other compounds, Cortexs lead ampakines CX1739 and CX1942, and extend through at least 2028. On May 8, 2007, Cortex entered into a license agreement, as subsequently amended, with the University of Alberta granting Cortex exclusive rights to practice patents held by the University of Alberta claiming the use of ampakines for the treatment of various respiratory disorders. These patents, along with Cortexs own patents claiming chemical structures, comprise Cortexs principal intellectual property supporting Cortexs research and clinical development program in the use of ampakines for the treatment of respiratory disorders. Cortex has completed pre-clinical studies indicating that several of its ampakines, including CX717, CX1739 and CX1942, were efficacious in treating drug induced respiratory depression caused by opiates or certain anesthetics without offsetting the analgesic effects of the opiates or the anesthetic effects of the anesthetics. In two clinical Phase 2 studies, one of which was published in a peer-reviewed journal, CX717, a predecessor compound to CX1739 and CX1942, antagonized the respiratory depression produced by fentanyl, a potent narcotic, without affecting the analgesia produced by this drug. In addition, Cortex has conducted a Phase 2A clinical study in which patients with sleep apnea were administered CX1739, Cortexs lead clinical compound. Preliminary results suggested that CX1739 might have use for the treatment of central and mixed sleep apnea, but not obstructive sleep apnea (OSA). In order to expand Cortexs respiratory disorders program, the Company acquired 100% of the issued and outstanding equity securities of Pier effective August 10, 2012 pursuant to an Agreement and Plan of Merger. Pier was formed in June 2007 (under the name SteadySleep Rx Co.) as a clinical stage pharmaceutical company to develop a pharmacologic treatment for the respiratory disorder known as OSA and had been engaged in research and clinical development activities since formation. Through the merger, the Company gained access to an Exclusive License Agreement (as amended, the License Agreement) that Pier had entered into with the University of Illinois on October 10, 2007. The License Agreement covered certain patents and patent applications in the United States and other countries claiming the use of certain compounds referred to as cannabinoids, of which dronabinol is a specific example, for the treatment of sleep related breathing disorders (including sleep apnea). Dronabinol is a synthetic derivative of the naturally occurring substance in the cannabis plant, otherwise known as Δ9-THC (Δ9-tetrahydrocannabinol). Piers business plan was to determine whether dronabinol would significantly improve subjective and objective clinical measures in patients with OSA. In addition, Pier intended to evaluate the feasibility and comparative efficacy of a proprietary formulation of dronabinol. The License Agreement granted Pier, among other provisions, exclusive rights: (i) to practice certain patents and patent applications, as defined in the License Agreement, that were then held by the University of Illinois; (ii) to identify, develop, make, have made, import, export, lease, sell, have sold or offer for sale any related licensed products; and (iii) to grant sub-licenses of the rights granted in the License Agreement, subject to the provisions of the License Agreement. Pier was required under the License Agreement, among other terms and conditions, to pay the University of Illinois a license fee, royalties, patent costs and certain milestone payments. Prior to the merger, Pier conducted a 21 day, randomized, double-blind, placebo-controlled dose escalation Phase 2 clinical study in 22 patients with OSA, in which dronabinol produced a statistically significant reduction in the Apnea-Hypopnea Index, the primary therapeutic end-point, and was observed to be safe and well tolerated. Dronabinol is currently under investigation, at the University of Illinois and other centers, in a potentially pivotal 120 patient, double-blind, placebo-controlled Phase 2B OSA clinical trial, fully funded by the National Institutes of Health, which the University of Illinois currently expects to be completed during the second quarter of 2016. The Company is not involved in the management or funding of this clinical trial. Dronabinol is a Schedule III, controlled generic drug with a relatively low abuse potential that is approved by the U.S. Food and Drug Administration (FDA) for the treatment of AIDS-related anorexia and chemotherapy induced emesis. The use of dronabinol for the treatment of OSA is a novel indication for an already approved drug and, as such, the Company believes that it would only require approval by the FDA of a supplemental new drug application. The License Agreement was terminated effective March 21, 2013 due to the Companys failure to make a required payment. New management subsequently opened negotiations with the University of Illinois and as a result, the Company ultimately entered into a new license agreement with the University of Illinois on June 27, 2014, the material terms of which were similar to the License Agreement that had been terminated on March 21, 2013. Going Concern The Companys condensed consolidated financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business. The Company has incurred net losses of $727,952 for the three months ended March 31, 2015 and $2,707,535 for the fiscal year ended December 31, 2014, negative operating cash flows of $200,403 for the three months ended March 31, 2015 and $885,869 for the fiscal year ended December 31, 2014, and expects to continue to incur net losses and negative operating cash flows for several more years. As a result, management has concluded that there is substantial doubt about the Companys ability to continue as a going concern, and the Companys independent registered public accounting firm, in their report on the Companys consolidated financial statements for the year ended December 31, 2014, has expressed substantial doubt about the Companys ability to continue as a going concern. The Company is currently, and has for some time, been in significant financial distress. It has limited cash resources and current assets and has no ongoing source of revenue. New management, which was appointed during March and April 2013, has evaluated and addressed the status of numerous aspects of the Companys existing business and obligations, including, without limitation, debt obligations, financial requirements, intellectual property, licensing agreements, legal and patent matters and regulatory compliance, and has raised new capital to fund its business activities. From June 2013 through March 2014, the Companys Chairman and Chief Executive Officer advanced short-term loans to the Company aggregating $150,000 in order to meet its minimum operating needs. In March and April 2014, the Company completed a private placement by selling 928.5 shares of its Series G 1.5% Convertible Preferred Stock for gross proceeds of $928,500 and repaid the aggregate advances. The Companys Chairman and Chief Executive Officer invested $250,000 in the Series G 1.5% Convertible Preferred Stock private placement. During November and December 2014, the Company sold short-term convertible notes and warrants in an aggregate principal amount of $369,500 to various accredited investors and an additional $210,000 of such short-term convertible notes and warrants in February 2015. The Company terminated this financing effective February 18, 2015. The Company will need to continue to raise additional capital to be able to pay its liabilities and fund its business activities going forward. As a result of the Companys current financial situation, the Company has limited access to external sources of debt and equity financing. Accordingly, there can be no assurances that the Company will be able to secure additional financing in the amounts necessary to fully fund its operating and debt service requirements. If the Company is unable to access sufficient cash resources, the Company may be forced to discontinue its operations entirely and liquidate. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 3. Summary of Significant Accounting Policies Principles of Consolidation The accompanying condensed consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (GAAP) and include the financial statements of Cortex and its wholly-owned subsidiary, Pier. Intercompany balances and transactions have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts may differ from those estimates. Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company limits its exposure to credit risk by investing its cash with high quality financial institutions. The Companys cash balances may periodically exceed federally insured limits. The Company has not experienced a loss in such accounts to date. Cash Equivalents The Company considers all highly liquid short-term investments with maturities of less than three months when acquired to be cash equivalents. Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels, and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers into and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently-traded, non-exchange-based derivatives and commingled investment funds, and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The Company believes that the carrying amount of its financial instruments (consisting of cash, cash equivalents, grants receivable and accounts payable) approximates fair value due to the short-term nature of such instruments. With respect to the note payable to a related party and the convertible notes payable, management does not believe that the credit markets have materially changed for these types of speculative borrowings since the original borrowing date. Deferred and Capitalized Financing Costs Costs incurred in connection with ongoing financing activities, including legal and other professional fees, cash finders and placement agent fees, and escrow agent fees, are deferred until the related financing is either completed or abandoned. Costs related to completed debt financings are capitalized on the balance sheet and amortized over the term of the related debt agreements. Amortization of these costs is calculated on the straight-line basis, which approximates the effective interest method, and is charged to interest expense in the consolidated statements of operations. Costs related to completed equity financings are charged directly to additional paid-in capital. Costs related to abandoned financings are charged to operations. Series G 1.5% Convertible Preferred Stock The Series G 1.5% Convertible Preferred Stock (including accrued dividends) issued in 2014 is mandatorily convertible into common stock at a fixed conversion rate on April 17, 2016 (if not converted earlier) and has no right to cash at any time or for any reason. Additionally, the Series G 1.5% Convertible Preferred Stock has no participatory or reset rights, or other protections (other than normal anti-dilution rights) based on subsequent events, including equity transactions. Accordingly, the Company has determined that the Series G 1.5% Convertible Preferred Stock should be categorized in stockholders equity (deficiency), and that there are no derivatives embedded in such security that would require identification, bifurcation and valuation. The Company did not issue any warrants to investors in conjunction with the Series G 1.5% Convertible Preferred Stock financing. On March 18, 2014 and April 17, 2014, the Company issued 753.22 shares and 175.28 shares, respectively, of Series G 1.5% Convertible Preferred Stock at a purchase price of $1,000 per share. Each share of Series G 1.5% Convertible Preferred Stock has a stated value of $1,000 per share and is convertible into shares of common stock at a fixed price of $0.0033 per share. On March 18, 2014 and April 17, 2014, the per share fair value of the common stock into which the Series G 1.5% Convertible Preferred Stock was convertible, determined by reference to the closing market prices of the Companys common stock on such closing dates, was $0.04 per share and $0.0348 per share, respectively, which was greater than the effective purchase price of such common shares of $0.0033 per share. The Company accounted for the beneficial conversion features in accordance with Accounting Standards Codification (ASC) 470-20, Accounting for Debt with Conversion and Other Options. The Company calculated a deemed dividend on the Series G 1.5% Convertible Preferred Stock of $8,376,719 in March 2014 and $1,673,127 in April 2014, which equals the amount by which the estimated fair value of the common stock issuable upon conversion of the issued Series G 1.5% Convertible Preferred Stock exceeded the proceeds from such issuances. The deemed dividend on the Series G 1.5% Convertible Preferred Stock was amortized on the straight-line basis from the respective issuance dates through the earliest conversion date of June 16, 2014, in accordance with ASC 470-20. The difference between the amortization of the deemed dividend calculated based on the straight-line method and the effective yield method was not material. The amortization of the deemed dividend for the three months ended March 31, 2014 was $1,209,970. Dr. Arnold S. Lippa, Ph.D., the Companys Chairman, Chief Executive Officer and a member of the Companys Board of Directors, purchased 250 shares for $250,000, representing 33.2% of the 753.22 shares of Series G 1.5% Convertible Preferred Stock sold in the initial closing of such financing on March 18, 2014. The second (and final) closing of such financing consisted entirely of Series G 1.5% Convertible Preferred Stock sold to unaffiliated investors. Accordingly, Dr. Lippa purchased 26.9% of the entire amount of Series G 1.5% Convertible Preferred Stock sold in the financing. Dr. Lippa had been an officer and director of the Company for approximately one year when he purchased the 250 shares of Series G 1.5% Convertible Preferred Stock, and his investment, which was only a portion of the first closing, was made on the same terms and conditions as those provided to the other unaffiliated investors who made up the majority of the financing. Dr. Lippa did not control, directly or indirectly, 10% or more of the Companys voting equity securities at the time of his investment. The proportionate share of the deemed dividend attributable to Dr. Lippas investment in the Series G 1.5% Convertible Preferred Stock in March 2014 was $2,780,303. 10% Convertible Notes Payable The convertible notes sold to investors in 2014 and 2015 have an interest rate of 10% per annum and are convertible into common stock at a fixed price of $0.035 per share. The convertible notes have no reset rights or other protections based on subsequent equity transactions, equity-linked transactions or other events. The warrants issued in connection with the sale of the convertible notes were detachable and are exercisable at a fixed price of $0.035 per share, have no right to cash at any time or under any circumstances, and have no reset rights or other protections based on subsequent equity transactions, equity-linked transactions or other events. Accordingly, the Company has determined that there are no embedded derivatives to be identified, bifurcated and valued in connection with this financing. On November 5, 2014, the Company sold an aggregate principal amount of $238,500 of its 10% convertible notes payable due September 15, 2015 (subject to extension to September 15, 2016, at the option of the Company, subject to the issuance of additional warrants) and warrants to purchase shares of common stock exercisable into a fixed number of shares of common stock of the Company calculated as the principal amount of each convertible note divided by $0.035 (i.e., 100% warrant coverage). The warrants do not have any cashless exercise provisions and are exercisable through September 30, 2015 at a fixed price of $0.035 per share. The shares of common stock issuable upon conversion of the notes payable and the exercise of the warrants are not subject to any registration rights. On December 9, 2014, December 31, 2014, and February 2, 2015, the Company sold an additional $46,000, $85,000 and $210,000, respectively, of principal amount of the convertible notes and warrants to various accredited investors. The Company terminated this financing effective February 18, 2015. The closing market prices of the Companys common stock on the transaction closing dates of November 5, 2014, December 9, 2014, December 31, 2014 and February 2, 2015 were $0.0524 per share, $0.0411 per share, $0.0451 per share and $0.043 per share, respectively, as compared to the fixed conversion price of the convertible notes and the fixed exercise price of the warrants of $0.035 per share. Accordingly, the Company has accounted for the beneficial conversion features with respect to the sale of the convertible notes and the issuance of the warrants in accordance with ASC 470-20, Accounting for Debt with Conversion and Other Options. The Company considered the face value of the convertible notes to be representative of their fair value. The Company determined the fair value of the warrants based on the Black-Scholes option-pricing model. The relative fair value method generated respective fair values for each of the convertible notes and the warrants of approximately 52% for the convertible notes and approximately 48% for the warrants. Once these values were determined, the fair value of the warrants of $176,549 and the fair value of the beneficial conversion feature of $192,951 (which were calculated based on the effective conversion price) were recorded as a reduction to the face value of the promissory note obligation. As a result, this aggregate debt discount reduced the carrying value of the convertible notes to zero at each issuance date. The excess amount generated from this calculation was not recorded, as the carrying value of a promissory note cannot be reduced below zero. The aggregate debt discount is being amortized as interest expense over the life of the promissory notes. The difference between the amortization of the debt discount calculated based on the straight-line method and the effective yield method was not material. The cash fees paid to finders and for legal costs were deferred and capitalized as deferred offering costs and are being amortized to interest expense over the life of the promissory notes. The finders warrants were considered as an additional cost of the offering and were included in deferred offering costs at fair value. The difference between the amortization of the deferred offering costs calculated based on the straight-line method and the effective yield method was not material. Equipment Equipment is recorded at cost and depreciated on a straight-line basis over their estimated useful lives, which range from three to five years. Long-Term Prepaid Insurance Long-term prepaid insurance represents the premium paid for directors and officers insurance tail coverage, which is being amortized on a straight-line basis over the policy period of six years. The amount amortizable in the ensuing twelve month period is recorded as a current asset in the Companys consolidated balance sheet at each reporting date. Impairment of Long-Lived Assets The Company reviews its long-lived assets, including long-term prepaid insurance, for impairment whenever events or changes in circumstances indicate that the total amount of an asset may not be recoverable, but at least annually. An impairment loss is recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than the assets carrying amount. The Company has not deemed any long-lived assets as impaired at March 31, 2015. Stock-Based Compensation The Company periodically issues common stock and stock options to officers, directors, Scientific Advisory Board members and consultants for services rendered. Such issuances vest and expire according to terms established at the issuance date of each grant. The Company accounts for stock-based payments to officers and directors by measuring the cost of services received in exchange for equity awards based on the grant date fair value of the awards, with the cost recognized as compensation expense on the straight-line basis in the Companys financial statements over the vesting period of the awards. The Company accounts for stock-based payments to Scientific Advisory Board members and consultants by determining the value of the stock compensation based upon the measurement date at either (a) the date at which a performance commitment is reached or (b) at the date at which the necessary performance to earn the equity instruments is complete. Stock grants, which are generally time vested, are measured at the grant date fair value and charged to operations over the vesting period. Options granted to members of the Companys Scientific Advisory Board and to outside consultants are revalued each reporting period until vested to determine the amount to be recorded as an expense in the respective period. As the options vest, they are valued on each vesting date and an adjustment is recorded for the difference between the value already recorded and the value on the date of vesting. All stock-based payments to employees, including grants of employee stock options, are recognized in the financial statements based on their fair values. The fair value of stock options is determined utilizing the Black-Scholes option-pricing model, and is affected by several variables, the most significant of which are the life of the equity award, the exercise price of the security as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. Estimated volatility is based on the historical volatility of the Companys common stock. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair value of common stock is determined by reference to the quoted market price of the Companys common stock. Stock options and warrants issued to non-employees as compensation for services to be provided to the Company or in settlement of debt are accounted for based upon the fair value of the services provided or the estimated fair value of the option or warrant, whichever can be more clearly determined. Management utilizes the Black-Scholes option-pricing model to determine the fair value of the stock options and warrants issued by the Company. The Company recognizes this expense over the period in which the services are provided. For options granted during the three months ended March 31, 2015, the fair value of each option award was estimated using the Black-Scholes option-pricing model with the following assumptions: Risk-free interest rate 1.3 % Expected dividend yield 0 % Expected volatility 249 % Expected life 5 years For options granted during the three months ended March 31, 2014, the fair value of each option award was estimated using the Black-Scholes option-pricing model with the following assumptions: Risk-free interest rate 1.5% to 2.7 % Expected dividend yield 0 % Expected volatility 200 % Expected life 5-10 years The Company issues new shares to satisfy stock option and warrant exercises. There were no options exercised during the three months ended March 31, 2015 and 2014. The Company recognizes the fair value of stock-based compensation in general and administrative costs and in research and development costs, as appropriate, in the Companys consolidated statements of operations. Income Taxes The Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes. Accordingly, the Company recognizes deferred tax assets and liabilities for the expected impact of differences between the financial statements and the tax basis of assets and liabilities. The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination was made. Likewise, should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made. Pursuant to Internal Revenue Code Sections 382 and 383, use of the Companys net operating loss and credit carryforwards may be limited if a cumulative change in ownership of more than 50% occurs within any three-year period since the last ownership change. The Company may have had a change in control under these Sections. However, the Company does not anticipate performing a complete analysis of the limitation on the annual use of the net operating loss and tax credit carryforwards until the time that it anticipates it will be able to utilize these tax attributes. As of March 31, 2015, the Company did not have any unrecognized tax benefits related to various federal and state income tax matters and does not anticipate any material amount of unrecognized tax benefits within the next 12 months. The Company is subject to U.S. federal income taxes and income taxes of various state tax jurisdictions. As the Companys net operating losses have yet to be utilized, all previous tax years remain open to examination by Federal authorities and other jurisdictions in which the Company currently operates or has operated in the past. The Company accounts for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by GAAP. The tax effects of a position are recognized only if it is more-likely-than-not to be sustained by the taxing authority as of the reporting date. If the tax position is not considered more-likely-than-not to be sustained, then no benefits of the position are recognized. As of March 31, 2015, the Company had not recorded any liability for uncertain tax positions. In subsequent periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense. Foreign Currency Transactions The note payable to related party, which is denominated in a foreign currency (the South Korean Won), is translated into the Companys functional currency (the United States Dollar) at the exchange rate on the balance sheet date. The foreign currency exchange gain or loss resulting from translation is recognized in the related consolidated statements of operations. Research Grants The Company recognizes revenues from research grants as earned based on the percentage-of-completion method of accounting and issues invoices for contract amounts billed based on the terms of the grant agreement. Revenues recorded under research grants in excess of amounts earned are classified as unearned grant revenue liability in the Companys consolidated balance sheet. Grant receivable reflects contractual amounts due and payable under the grant agreement. The payment of grant receivables is based on progress reports provided by the Company. As of March 31, 2015, the Company was current in filing the required progress reports, as a result of which no allowance for uncollectible amounts was considered necessary. Research grants are generally funded and paid through government or institutional programs. Amounts received under research grants are nonrefundable, regardless of the success of the underlying research project, to the extent that such amounts are expended in accordance with the approved grant project. During the three months ended March 31, 2015, the Company had research grant revenues of $74,534. At March 31, 2015 and December 31, 2014, the Company had grant receivable of $28,583 and $48,000, respectively, and unearned grant revenues of $12,382 and $34,333, respectively. The Company had no research grant revenues during the three months ended March 31, 2014. Research and Development Costs Research and development costs consist primarily of fees paid to consultants and outside service providers and organizations (including research institutes at universities), patent fees and costs, and other expenses relating to the acquisition, design, development and testing of the Companys treatments and product candidates. Research and development costs incurred by the Company under research grants are expensed as incurred over the life of the underlying contracts, unless the terms of the contract indicate that a different expensing schedule is more appropriate. The Company reviews the status of its research and development contracts on a quarterly basis. License Agreements Obligations incurred with respect to mandatory payments provided for in license agreements are recognized ratably over the appropriate period, as specified in the underlying license agreement, and are recorded as liabilities in the Companys consolidated balance sheet, with a corresponding charge to research and development costs in the Companys consolidated statement of operations. Obligations incurred with respect to milestone payments provided for in license agreements are recognized when it is probable that such milestone will be reached, and are recorded as liabilities in the Companys consolidated balance sheet, with a corresponding charge to research and development costs in the Companys consolidated statement of operations. Payments of such liabilities are made in the ordinary course of business. Patent Costs Due to the significant uncertainty associated with the successful development of one or more commercially viable products based on the Companys research efforts and any related patent applications, all patent costs, including patent-related legal and filing fees, are expensed as incurred. Comprehensive Income (Loss) Components of comprehensive income or loss, including net income or loss, are reported in the financial statements in the period in which they are recognized. Comprehensive income or loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net income (loss) and other comprehensive income (loss) are reported net of any related tax effect to arrive at comprehensive income (loss). The Company did not have any items of comprehensive income (loss) for the three months ended March 31, 2015 and 2014. Earnings per Share The Companys computation of earnings per share (EPS) includes basic and diluted EPS. Basic EPS is measured as the income (loss) attributable to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., warrants and options) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Net income (loss) attributable to common stockholders consists of net income or loss, as adjusted for actual and deemed preferred stock dividends declared, amortized or accumulated. Loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the respective periods. Basic and diluted loss per common share is the same for all periods presented because all warrants and stock options outstanding are anti-dilutive. At March 31, 2015 and 2014, the Company excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. March 31, 2015 2014 Series B convertible preferred stock 3,679 3,679 Series G 1.5% convertible preferred stock 257,760,939 228,372,117 10% convertible notes payable 17,034,702 Common stock warrants 32,106,094 4,000,000 Common stock options 26,216,668 9,466,668 Total 333,122,082 241,842,464 Reclassifications Certain comparative figures in 2014 have been reclassified to conform to the current years presentation. These reclassifications were immaterial, both individually and in the aggregate. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (ASU 2014-15), Presentation of Financial Statements Going Concern (Subtopic 205-10) In January 2015, the FASB issued Accounting Standards Update No. 2015-01 (ASU 2015-01), Income Statement Extraordinary and Unusual Items (Subtopic 225-20). In February 2015, the FASB issued Accounting Standards Update No. 2015-02 (ASU 2015-02), Consolidation (Topic 810). In April 2015, the FASB issued Accounting Standards Update No. 2015-03 (ASU 2015-03), Interest Imputation of Interest (Subtopic 835-30) In April 2015, the FASB issued Accounting Standards Update No. 2015-05 (ASU 2015-05), Intangibles Goodwill and Other Internal-Use Software (Subtopic 350-40). Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Companys financial statement presentation or disclosures. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2015 | |
Debt Disclosure [Abstract] | |
Notes Payable | 4. Notes Payable 10% Convertible Notes Payable On November 5, 2014, the Company entered into a Convertible Note and Warrant Purchase Agreement (the Purchase Agreement) with various accredited, non-affiliated investors (each, a Purchaser), pursuant to which the Company sold an aggregate principal amount of $238,500 of its (i) 10% Convertible Notes due September 15, 2015 (each a Note, and together, the Notes) and (ii) Warrants to purchase shares of common stock (the Warrants) as described below. This was the initial closing of a private placement that was terminated effective February 18, 2015. Unless otherwise provided for in the Notes, the outstanding principal balance of each Note and all accrued and unpaid interest, compounded annually at 10%, is due and payable in full on September 15, 2015. The Company may elect, at its option and in its sole discretion, to extend the maturity date of the Notes to September 15, 2016 upon thirty days notice to the Note holders delivered prior to the maturity date, subject to the issuance by the Company to the Note holders of additional warrants, exercisable for a period of one year from the date of issuance, to purchase the Companys common stock exercisable at $0.035 per share of common stock, into that number of shares of common stock calculated as the product of the principal amount of the Note plus any accrued and unpaid interest, multiplied by 50% and then dividing that product by $0.035 (the Extended Maturity Date Warrant). The Extended Maturity Date Warrant shall otherwise be substantially similar in form and substance to the warrant issued in connection with the Note. At any time, each Purchaser may elect, at its option and in its sole discretion, to convert the outstanding principal amount into a fixed number of shares of the Companys common stock equal to the quotient obtained by dividing the outstanding principal amount by $0.035 (an aggregate of 6,814,286 shares for the initial closing), plus any accrued and unpaid interest, which is treated in the same manner as the outstanding principal amount. In the case of a Qualified Financing (as defined in the Purchase Agreement), the outstanding principal amount and accrued and unpaid interest under the Notes automatically convert into common stock at a common stock equivalent price of $0.035. In the case of an Acquisition (as defined in the Purchase Agreement), the Company may elect to either: (i) convert the outstanding principal amount and all accrued and unpaid interest under the Notes into shares of common stock or (ii) accelerate the maturity date of the Notes to the date of closing of the Acquisition. Each Warrant to purchase shares of common stock is exercisable into a fixed number of shares of common stock of the Company calculated as each Purchasers investment amount divided by $0.035 (an aggregate of 6,814,286 shares for the initial closing). The Warrants were detachable and are exercisable through September 15, 2015 at a fixed price of $0.035 per share. The warrants do not have any cashless exercise provisions. The shares of common stock issuable upon conversion of the Notes and exercise of the Warrants are not subject to any registration rights. On December 9, 2014, December 31, 2014, and February 2, 2015, the Company sold an additional $46,000, $85,000 and $210,000, respectively, of principal amount of the Notes and Warrants to various accredited investors. The Company terminated this financing effective February 18, 2015. Placement agent fees, brokerage commissions, finders fees and similar payments were made in the form of cash and warrants to qualified referral sources in connection with the sale of the Notes and Warrants. In connection with the initial closing, fees of $16,695 were paid in cash, based on 7% of the aggregate principal amount of the Notes issued to such referral sources, and the fees paid in warrants (the Placement Agent Warrants) consisted of 477,000 warrants, reflecting warrants for that number of shares equal to 7% of the number of shares of common stock into which the corresponding Notes are convertible. In connection with the second closing, fees of $700 were paid in cash and 20,000 Placement Agent Warrants were issued. In connection with the third closing, fees of $3,500 were paid in cash and 100,000 Placement Agent Warrants were issued. In connection with the fourth closing, fees of $14,700 were paid in cash and 420,000 Placement Agent Warrants were issued. The Placement Agent Warrants have cashless exercise provisions and are exercisable through September 15, 2015 at a fixed price of $0.035 per share. The stock warrants issued to the placement agent and/or its designees or affiliates in connection with the 2014 closings of the Purchase Agreement, to purchase 597,000 shares of the Companys common stock, were valued pursuant to the Black-Scholes option-pricing model at $19,986, $614 and $3,340, respectively. The stock warrants issued to the placement agent and/or its designees or affiliates in connection with the February 2, 2015 closing of the Purchase Agreement, to purchase 420,000 shares of the Companys common stock, were valued pursuant to the Black-Scholes option-pricing model at $12,726. Total financing costs at March 31, 2015 aggregating $129,776, consisting of $93,110 paid in cash and $36,666 paid in the form of Placement Agent Warrants, are being amortized as additional interest expense over the life of the Notes. During the three months ended March 31, 2015, $37,098 was charged to interest expense with respect to the amortization of capitalized financing costs. Aurora Capital LLC, a related party (see Note 8), was the placement agent for this financing, and Aurora and its designees and/or affiliates received aggregate fees in connection with this financing in the form of $33,425 in cash and Placement Agent Warrants to purchase 955,000 shares of common stock in connection with the four closings. The Notes and Warrants were offered and sold without registration under the Securities Act in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as provided in Rule 506 of Regulation D promulgated thereunder. The Notes and Warrants and the shares of common stock issuable upon conversion of the Notes and exercise of the Warrants have not been registered under the Securities Act or any other applicable securities laws, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act. The Company used the Black-Scholes option-pricing model to estimate the fair value of the warrants to purchase 16,557,141 shares of the Companys common stock sold to investors in connection with the four closings at a fixed exercise price of $0.035 per share. The Company applied the relative fair value method to allocate the proceeds from the borrowing to the Notes and the Warrants. Consequently, approximately 50% of the proceeds of the borrowing were attributed to the debt instrument. The 50% value attributed to the Warrants is being amortized as additional interest expense over the life of the related Notes. During the three months ended March 31, 2015, $82,667 was charged to interest expense from the amortization of debt discount related to the value attributed to the Warrants. During the three months ended March 31, 2015, $83,320 was charged to interest expense from the amortization of debt discount related to the value attributed to the beneficial conversion feature. The 10% Convertible Notes Payable consist of the following at March 31, 2015 and December 31, 2014: March 31, 2015 December 31, 2014 Principal amount of notes payable $ 579,500 $ 369,500 Add accrued interest payable 16,715 4,093 596,215 373,593 Less unamortized discounts: Stock warrants (185,145 ) (155,264 ) Beneficial conversion feature (182,209 ) (168,086 ) $ 228,861 $ 50,243 As of March 31, 2015, the 10% Convertible Notes Payable were convertible into 17,034,702 shares of the Companys common stock, including 477,560 shares attributable to accrued interest of $16,715 payable as of such date. As of December 31, 2014, the 10% Convertible Notes Payable were convertible into 10,674,107 shares of the Companys common stock, including 116,964 shares attributable to accrued interest of $4,093 payable as of such date. Note Payable to Related Party On June 25, 2012, the Company borrowed 465,000,000 Won (the currency of South Korea, equivalent to approximately $400,000 United States Dollars) from and executed a secured note payable to SY Corporation Co., Ltd., formerly known as Samyang Optics Co. Ltd. (Samyang), an approximately 20% common stockholder of the Company at that time. The note accrues simple interest at the rate of 12% per annum and has a maturity date of June 25, 2013, although Samyang was permitted to demand early repayment of the promissory note on or after December 25, 2012. Samyang did not demand early repayment. The Company has not made any payments on the promissory note. At June 30, 2013 and subsequently, the promissory note was outstanding and in technical default, although Samyang has not issued a notice of default or a demand for repayment. The Company believes that Samyang is in default of its obligations under its January 2012 license agreement, as amended, with the Company, but the Company has not yet issued a notice of default. The Company is endeavoring to enter into discussions with Samyang with a view toward a comprehensive resolution of the aforementioned matters. The promissory note is secured by collateral that represents a lien on certain patents owned by the Company, including composition of matter patents for certain of the Companys high impact ampakine compounds and the low impact ampakine compounds CX2007 and CX2076, and other related compounds. The security interest does not extend to the Companys patents for its ampakine compounds CX1739 and CX1942, or to the patent for the use of ampakine compounds for the treatment of respiratory depression. In connection with this financing, the Company issued to Samyang two-year detachable warrants to purchase 4,000,000 shares of the Companys common stock at a fixed exercise price of $0.056 per share. The warrants had a call right for consideration of $0.001 per share, in favor of the Company, to the extent that the weighted average closing price of the Companys common stock exceeds $0.084 per share for each of ten consecutive trading days, subject to certain circumstances. Additionally, an existing license agreement with Samyang was expanded to include rights to ampakine CX1739 in South Korea for the treatment of sleep apnea and respiratory depression. The warrants expired unexercised on June 25, 2014. The Company used the Black-Scholes option-pricing model to estimate the fair value of the two-year detachable warrants to purchase 4,000,000 shares of the Companys common stock at a fixed exercise price of $0.056 per share. The Company applied the relative fair value method to allocate the proceeds from the borrowing to the note payable and the detachable warrants. The Company did not consider the expansion of the existing license agreement with Samyang to have any significant value. Consequently, approximately 64% of the proceeds of the borrowing were attributed to the debt instrument. The 36% value attributed to the warrant was amortized as additional interest expense over the life of the note. Additionally, financing costs aggregating $21,370 incurred in connection with the transaction were also amortized over the expected life of the note. In that repayment could be demanded after six months, that period was used as the expected life of the note payable for amortization purposes. Note payable to Samyang consists of the following at March 31, 2015 and December 31, 2014: March 31, 2015 December 31, 2014 Principal amount of note payable $ 399,774 $ 399,774 Accrued interest payable 134,611 122,618 Foreign currency transaction adjustment (325 ) 3,865 $ 534,060 $ 526,257 Notes Payable to Chairman On June 25, 2013, the Arnold Lippa Family Trust, an affiliate of Dr. Arnold S. Lippa, the Companys Chairman and Chief Executive Officer, began advancing funds to the Company in order to meet minimum operating needs. At December 31, 2013, Dr. Lippa had advanced a total of $75,000 to the Company. Such advances reached a maximum of $150,000 on March 3, 2014 and were due on demand with interest at a rate per annum equal to the Blended Annual Rate, as published by the U.S. Internal Revenue Service of approximately 0.22% for the period outstanding. In March 2014, the Company repaid the working capital advances, including accrued interest of $102, with the proceeds from the private placement of its Series G 1.5% Convertible Preferred Stock. Other Short-Term Note Payable The other short-term note payable at March 31, 2015 consists of a premium financing agreement with respect to an insurance policy. The note is payable, with interest at 5.08%, in ten monthly installments of $3,697. |
Project Advance
Project Advance | 3 Months Ended |
Mar. 31, 2015 | |
Project Advance | |
Project Advance | 5. Project Advance In June 2000, the Company received $247,300 from the Institute for the Study of Aging (the Institute) pursuant to a note (the Note) and Agreement to Accept Conditions of Loan Support (the Loan Support Agreement) to fund testing of CX516, one of the Companys ampakine compounds, in patients with mild cognitive impairment (MCI). Patients with MCI represent the earliest clinically-defined group with memory impairment beyond that expected for normal individuals of the same age and education, but such patients do not meet the clinical criteria for Alzheimers disease. During 2002 and 2003, the Company conducted a double-blind, placebo-controlled clinical study with 175 elderly patients displaying MCI and issued a final report on June 21, 2004. CX516 did not improve the memory impairments observed in these patients. Pursuant to the Note and Loan Support Agreement, if the Company complied with certain conditions, including the completion of the MCI clinical trial, the Company would not be required to make any repayments unless and until the Company enters one of its ampakine compounds into a Phase 3 clinical trials for Alzheimers disease. Upon initiation of such clinical trials, repayment would include the principal amount plus accrued interest computed at a rate equal to one-half of the prime lending rate. In the event of repayment, the Institute could elect to receive the outstanding principal balance and any accrued interest thereon in shares of the Companys common stock. The conversion price for such form of repayment was fixed at $4.50 per share and was subject to adjustment if the Company paid a dividend or distribution in shares of common stock, effected a stock split or reverse stock split, effected a reorganization or reclassification of its capital stock, or effected a consolidation or merger with or into another corporation or entity. On September 2, 2014, the Company entered into a Release Agreement (the Release Agreement) with the Institute to settle this outstanding obligation, which had an outstanding balance of $336,809, including accrued interest of $89,509, on such date. Pursuant to the terms of the Release Agreement, the Institute received 1,000,000 shares of the Companys common stock as settlement of all obligations of the Company under the Note and the Loan Support Agreement. Such common shares are restricted securities as defined under Rule 144 promulgated under the Securities Act of 1933, as amended, and are not subject to any registration rights. The Release Agreement also includes a mutual release between the Company and the Institute, releasing each party from all claims up until the date of the Release Agreement. The 1,000,000 common shares issued were valued at $49,000, based on the closing price of the Companys common stock on September 2, 2014 of $0.049 per share. The settlement resulted in the Company recognizing a gain of $287,809 during the year ended December 31, 2014. |
Settlements
Settlements | 3 Months Ended |
Mar. 31, 2015 | |
Settlements | |
Settlements | 6. Settlements During the three months ended March 31, 2014, the Company executed settlement agreements with four former executives that resulted in the settlement of potential claims totaling $1,336,264 that had been previously accrued in 2012 and 2013. The Company made cash payments of $118,084 and issued stock options to purchase 4,300,000 shares of common stock exercisable at $0.04 per share for periods ranging from five to ten years. The stock options were valued pursuant to the Black-Scholes option-pricing model at $179,910. In addition to other provisions, the settlement agreements included mutual releases. The settlements resulted in the Company recognizing a gain of $1,038,270 during the three months ended March 31, 2014. During the three months ended June 30, 2014, the Company executed settlement agreements with two former professional service providers that resulted in the settlement of potential claims totaling $496,514 for a cost of $60,675 in cash, plus the issuance of stock options to purchase 1,250,000 shares of common stock exercisable at $0.04 per share for a period of five years, and valued pursuant to the Black-Scholes option-pricing model at $42,250 in the aggregate. In addition to other provisions, the settlement agreements included mutual releases. The settlements resulted in the Company recognizing a gain of $393,590 during the three months ended June 30, 2014. On September 2, 2014, the Company recognized a gain of $287,809 resulting from the settlement of an obligation to the Institute for the Study of Aging. Additional information with respect to this settlement is provided at Note 5. Effective January 29, 2015, the Company executed a settlement agreement with its former Vice President and Chief Financial Officer, as amended on February 4, 2015, that resulted in the settlement of potential claims for a total cash payment of $26,000 to be paid on or before June 30, 2015 (of which $6,000 was paid on execution and $1,500 was paid in March 2015), plus the issuance of a stock option to purchase 500,000 shares of common stock exercisable at $0.0512 per share for a period of five years, and valued pursuant to the Black-Scholes option-pricing model at $25,450. In addition to other provisions, the settlement agreement included mutual releases. The settlement resulted in the Company recognizing a gain of $92,550 during the three months ended March 31, 2015. The Company continues to explore ways to reduce its indebtedness, and might in the future enter additional settlements of potential claims, including, without limitation, those by other former executives or third party creditors. |
Stockholders' Deficiency
Stockholders' Deficiency | 3 Months Ended |
Mar. 31, 2015 | |
Equity [Abstract] | |
Stockholders' Deficiency | 7. Stockholders Deficiency Preferred Stock The Company has authorized a total of 5,000,000 shares of preferred stock, par value $0.001 per share. As of December 31, 2014, 1,250,000 shares were designated as 9% Cumulative Convertible Preferred Stock (non-voting, 9% Preferred Stock); 37,500 shares were designated as Series B Convertible Preferred Stock (non-voting, Series B Preferred Stock); 205,000 shares were designated as Series A Junior Participating Preferred Stock (non-voting, Series A Junior Participating Preferred Stock); and 1,700 shares were designated as Series G 1.5% Convertible Preferred Stock. Accordingly, as of March 31, 2015, 3,505,800 shares of preferred stock were undesignated and may be issued with such rights and powers as the Board of Directors may designate. There were no shares of 9% Preferred Stock or Series A Junior Participating Preferred Stock outstanding as of March 31, 2015 or December 31, 2014. Series B Preferred Stock outstanding as of March 31, 2015 and December 31, 2014 consisted of 37,500 shares issued in a May 1991 private placement. Each share of Series B Preferred Stock is convertible into approximately 0.09812 shares of common stock at an effective conversion price of $6.795 per share of common stock, which is subject to adjustment under certain circumstances. As of March 31, 2015 and December 31, 2014, the shares of Series B Preferred Stock outstanding are convertible into 3,679 shares of common stock. The Company may redeem the Series B Preferred Stock for $25,001, equivalent to $0.6667 per share, an amount equal to its liquidation preference, at any time upon 30 days prior notice. Series G 1.5% Convertible Preferred Stock On March 18, 2014, the Company entered into Securities Purchase Agreements with various accredited investors (the Initial Purchasers), pursuant to which the Company sold an aggregate of 753.22 shares of its Series G 1.5% Convertible Preferred Stock for a purchase price of $1,000 per share, or an aggregate purchase price of $753,220. This financing represented the initial closing on the private placement (the Private Placement). The Initial Purchasers in this tranche of the Private Placement consisted of (i) Dr. Arnold S. Lippa, the Companys Chairman, Chief Executive Officer and a member of the Companys Board of Directors, who invested $250,000 for 250 shares of Series G 1.5% Convertible Preferred Stock, and (ii) new, non-affiliated, accredited investors. Neither the Series G 1.5% Convertible Preferred Stock nor the underlying shares of common stock have any registration rights. The placement agents and selected dealers in connection with the initial tranche of the Private Placement received cash fees totaling $3,955 as compensation and an obligation of the Company to issue warrants to acquire 12,865,151 shares of common stock, totaling approximately 5.6365% of the shares of common stock into which the Series G 1.5% Convertible Preferred Stock may convert, issuable upon completion of all closings of the Private Placement and exercisable for five years, at a fixed price of $0.00396, which is 120% of the conversion price at which the Series G 1.5% Convertible Preferred Stock may convert into the Companys common stock. The stock warrants issuable to the placement agents and selected dealers in connection with the initial tranche of the Private Placement were valued pursuant to the Black-Scholes option-pricing model at $443,848. The Series G 1.5% Convertible Preferred Stock has a stated value of $1,000 per share and a stated dividend at the rate per share (as a percentage of the Stated Value per share) of 1.5% per annum, compounded quarterly, payable quarterly within 15 calendar days of the end of each fiscal quarter of the Company, in duly authorized, validly issued, fully paid and non-assessable shares of Series G 1.5% Convertible Preferred Stock, which may include fractional shares of Series G 1.5% Convertible Preferred Stock. The Company recorded a dividend on the Series G 1.5% Convertible Preferred Stock of $3,198 and $408 for the three months ended March 31, 2015 and 2014, respectively, which was paid through the issuance of an additional 3.2 shares and 0.4 shares, respectively, of Series G 1.5% Convertible Preferred Stock. The Company recorded a dividend on the Series G 1.5% Convertible Preferred Stock of $10,926 for the year ended December 31, 2014, which was paid through the issuance of an additional 10.9 shares of Series G 1.5% Convertible Preferred Stock. The Series G 1.5% Convertible Preferred Stock became convertible, beginning 60 days after the last share of Series G 1.5% Convertible Preferred Stock is issued in the Private Placement, at the option of the holder, into common stock at the applicable conversion price, at a rate determined by dividing the Stated Value of the shares of Series G 1.5% Convertible Preferred Stock to be converted by the conversion price, subject to adjustments for stock dividends, splits, combinations and similar events as described in the form of Certificate of Designation. As the stated value of the Series G 1.5% Convertible Preferred Stock is $1,000 per share, and the fixed conversion price is $0.0033, each share of Series G 1.5% Convertible Preferred Stock is convertible into 303,030.3 shares of common stock. In addition, the Company has the right to require the holders of the Series G 1.5% Convertible Preferred Stock to convert such shares into common stock under certain enumerated circumstances as set forth in the Certificate of Designation. Upon either (i) a Qualified Public Offering (as defined in the Certificate of Designation) or (ii) the affirmative vote of the holders of a majority of the Stated Value of the Series G 1.5% Convertible Preferred Stock issued and outstanding, all outstanding shares of Series G 1.5% Convertible Preferred Stock, plus all accrued or declared, but unpaid, dividends thereon, shall be mandatorily converted into such number of shares of common stock determined by dividing the Stated Value of such Series G 1.5% Convertible Preferred Stock (together with the amount of any accrued or declared, but unpaid, dividends thereon) by the Conversion Price (as defined in the Certificate of Designation). If not earlier converted, the Series G 1.5% Convertible Preferred Stock shall be redeemed by conversion on the two year anniversary of the date the last share of Series G 1.5% Convertible Preferred Stock is issued in the Private Placement at the Conversion Price. Except as described in the Certificate of Designation, holders of the Series G 1.5% Convertible Preferred Stock will vote together with holders of the Company common stock on all matters, on an as-converted to common stock basis, and not as a separate class or series (subject to limited exceptions). In the event of any liquidation or winding up of the Company prior to and in preference to any Junior Securities (including common stock), the holders of the Series G 1.5% Convertible Preferred Stock will be entitled to receive in preference to the holders of the Company common stock a per share amount equal to the Stated Value, plus any accrued and unpaid dividends thereon. Purchasers in the Private Placement of the Series G 1.5% Convertible Preferred Stock executed written consents in favor of (i) approving and adopting an amendment to the Companys certificate of incorporation that increases the number of authorized shares of the Company to 1,405,000,000, 1,400,000,000 of which are shares of common stock and 5,000,000 of which are shares of preferred stock, and (ii) approving and adopting the Cortex Pharmaceuticals, Inc. 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan. The shares of Series G 1.5% Convertible Preferred Stock were offered and sold without registration under the Securities Act of 1933, as amended (the Securities Act), in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act as provided in Rule 506(b) of Regulation D promulgated thereunder. The shares of Series G 1.5% Convertible Preferred Stock and the Companys common stock issuable upon conversion of the shares of Series G 1.5% Convertible Preferred Stock have not been registered under the Securities Act or any other applicable securities laws, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act. On April 17, 2014, the Company entered into Securities Purchase Agreements with various accredited investors (together with the Initial Purchasers as defined above, the Purchasers), pursuant to which the Company sold an aggregate of an additional 175.28 shares of its Series G 1.5% Convertible Preferred Stock, for a purchase price of $1,000 per share, or an aggregate purchase price of $175,280. This was the second and final closing on the Private Placement, in which a total of 928.5 shares of Series G 1.5% Convertible Preferred Stock were sold for an aggregate purchase price of $928,500. The Purchasers in the second and final tranche of the Private Placement consisted of new, non-affiliated, accredited investors and non-management investors who had also invested in the first closing. One of the investors in this second and final closing was an affiliate of an associated person of Aurora Capital LLC, a related party (see Note 8). Neither the Series G 1.5% Convertible Preferred Stock nor the underlying shares of common stock have any registration rights. The placement agents and selected dealers in connection with the second tranche of the Private Placement received cash fees of $3,465 as compensation and an obligation of the Company to issue warrants to acquire 6,386,120 shares of common stock, totaling approximately 12% of the shares of common stock into which the Series G 1.5% Convertible Preferred Stock may convert, issuable upon completion of all closings of the Private Placement and exercisable for five years, at a fixed price of $0.00396, which is 120% of the conversion price at which the Series G 1.5% Convertible Preferred Stock may convert into the Companys common stock. The stock warrants issuable to the placement agents and selected dealers in connection with the second closing of the Private Placement were valued pursuant to the Black-Scholes option-pricing model at $220,321. As the stated value of the Series G 1.5% Convertible Preferred Stock is $1,000 per share, and the fixed conversion price is $0.0033, each share of Series G 1.5% Convertible Preferred Stock is convertible into 303,030.3 shares of common stock. The aggregate of 928.5 shares of Series G 1.5% Convertible Preferred Stock sold in all of the closings of the Private Placement were initially convertible into a total of 281,363,634 shares of common stock. The warrants that the placement agents and selected dealers received in connection with all closings of the Private Placement, which were issued effective April 17, 2014, represent the right to acquire 19,251,271 shares of common stock exercisable for five years at a fixed price of $0.00396, which is 120% of the conversion price at which the Series G 1.5% Convertible Preferred Stock may convert into the Companys common stock. Aurora Capital LLC, a related party (see Note 8), was one of the placement agents for this financing, and Aurora and its designees and/or affiliates received fees in connection with this financing in the form of cash of $2,800 and warrants to purchase 10,427,029 shares of common stock during the year ended December 31, 2014. Both Dr. Arnold S. Lippa and Jeff E. Margolis, officers and directors of the Company since March 22, 2013, have indirect ownership interests in Aurora Capital LLC through interests held in its members, and Jeff E. Margolis is also an officer of Aurora Capital LLC. Effective August 25, 2014, a finders warrant issued on April 17, 2014 in conjunction with the Private Placement of the Series G 1.5% Convertible Preferred Stock, representing the right to acquire a total of 2,112,879 shares of common stock, was exercised in full on a cashless basis, resulting in the net issuance of 1,942,124 shares of common stock. Effective September 5, 2014, a finders warrant issued on April 17, 2014 in conjunction with the Private Placement of the Series G 1.5% Convertible Preferred Stock, representing the right to acquire a total of 2,412,878 shares of common stock, was exercised in part (50%, or 1,206,439 shares) on a cashless basis, resulting in the net issuance of 1,126,814 shares of common stock. Effective September 26, 2014, a finders warrant issued on April 17, 2014 in conjunction with the Private Placement of the Series G 1.5% Convertible Preferred Stock, representing the right to acquire a total of 1,400,000 shares of common stock, was exercised in full on a cashless basis, resulting in the net issuance of 1,326,080 shares of common stock. Effective December 16, 2014, 66.68888 shares of Series G 1.5% Convertible Preferred Stock, including 0.68888 dividend shares, were converted into 20,208,752 shares of common stock on a cashless basis. During the three months ended March 31, 2015, 25.323705 shares of Series G 1.5% Convertible Preferred Stock, including 0.323705 dividend shares, were converted into 7,673,850 shares of common stock on a cashless basis. As of March 31, 2015, the Series G 1.5% Convertible Preferred Stock was convertible into 257,760,939 shares of the Companys common stock, including 3,973,063 shares attributable to the 1.5% dividend on such shares of $13,111 accrued as of such date. As of December 31, 2014, the Series G 1.5% Convertible Preferred Stock was convertible into 264,465,728 shares of the Companys common stock, including 3,102,094 shares attributable to the 1.5% dividend on such shares of $10,237 accrued as of such date. See Note 10 for a description of additional Series G 1.5% Convertible Preferred Stock conversions. Common Stock As discussed above, the holders of the Series G 1.5% Convertible Preferred Stock approved and adopted an amendment to increase the number of authorized shares of the Company to 1,405,000,000, 1,400,000,000 of which are shares of common stock and 5,000,000 of which are shares of preferred stock. The Company also sought, and on April 17, 2014 obtained by written consent, sufficient votes of the holders of its common stock, voting as a separate class, to effect this amendment. A certificate of Amendment to the Companys Certificate of Incorporation to effect the increase in the authorized shares was filed with the Secretary of State of the State of Delaware on April 17, 2014. On April 14, 2014, the Board of Directors of the Company awarded a total of 57,000,000 shares of common stock of the Company, including awards of 15,000,000 shares to each of the Companys three executive officers, who were also all of the directors of the Company at that time, and 4,000,000 shares and 8,000,000 shares to two other individuals. The individual who received the 8,000,000 shares was an associated person of Aurora Capital LLC, a related party (see Note 8). These awards were made to those individuals on that date as compensation for services rendered through March 31, 2014. Prior to these awards, none of the officers or directors of the Company had earned or received any cash compensation from the Company since joining the Company in March and April 2013, and there were no prior compensation arrangements or agreements with such individuals. As the initial closing of the Series G 1.5% Convertible Preferred Stock was completed on March 18, 2014, and such closing represented approximately 81% of the total amount of such financing, the Companys Board of Directors determined that it was appropriate at that time to compensate such officers for the period since they joined the Company in March and April 2013 through March 31, 2014. Such compensation was concluded on April 14, 2014 with the issuance of the aforementioned stock awards. Accordingly, as a result of these factors, the fair value of these stock awards of $2,280,000 was charged to operations effective as of March 18, 2014. The stock awards were valued at $0.04 per share, which was the closing price of the Companys common stock on March 18, 2014. These stock awards were made under the Companys 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan. On September 3, 2014, James Sapirstein and Kathryn MacFarlane were appointed to the Board of Directors of the Company, and in connection therewith, pursuant to the Companys 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan, they were awarded an aggregate of 4,000,000 shares of common stock of the Company, consisting of 2,000,000 shares to each new director, vesting 50% upon appointment to the Board of Directors, 25% on September 30, 2014 and 25% on December 31, 2014. The stock awards were valued at $0.049 per share, which was the closing price of the Companys common stock on September 3, 2014. During the period September 3, 2014 through December 31, 2014, the Company recorded charges to operations of $196,000 with respect to these stock awards. On September 18, 2014, Dr. John Greer, Ph.D. was appointed to the position of Chairman of the Companys Scientific Advisory Board. Dr. Greer is the Director of the Neuroscience and Mental Health Institute at the University of Alberta, holds two grants regarding research into neuromuscular control of breathing, and is the inventor on the use patents licensed by the Company with respect to ampakines. In connection with the appointment of Dr. Greer as Chairman of the Companys Scientific Advisory Board on September 18, 2014, the Board of Directors awarded 2,000,000 shares of common stock of the Company to Dr. Greer (through his wholly-owned consulting company, Progress Scientific, Inc.), vesting 25% upon appointment, 25% on September 30, 2014, 25% on December 31, 2014, and 25% on March 31, 2015. The stock award was valued at $0.066 per share, which was the closing price of the Companys common stock on September 18, 2014. This stock award was made under the Companys 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan. During the period September 18, 2014 through December 31, 2014, the Company recorded charges to operations of $99,000 with respect to this stock award. During the three months ended March 31, 2015, the Company recorded a final charge to operations of $33,000 with respect to this stock award. Effective October 15, 2014, Richard Purcell was appointed as the Companys Senior Vice President of Research and Development. In conjunction with his appointment, the Company agreed to issue to Mr. Purcell 2,000,000 shares of the Companys common stock, with 25% of such stock grant vesting and issuable every three months after the date of his appointment (i.e., on January 15, 2015, April 15, 2015, July 15, 2015 and October 15, 2015), subject to Mr. Purcells continued relationship with the Company on each of the vesting dates. The stock grant was made under the Companys 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan. Based on the Companys closing stock price on October 15, 2014 of $0.078 per share, during the three months ended March 31, 2015, the Company recorded a charge to operations of $39,000 with respect to this stock award. At March 31, 2015, total unrecognized compensation expense for the outstanding unvested stock awards was $117,000, which will be recognized by the Company as charges to operations of $39,000 on each of April 15, 2015, July 15, 2015 and October 15, 2015. Information with respect to common stock purchase warrants issued to finders and placement agents in connection with the sale of the Notes and Warrants is provided at Note 4 under 10% Convertible Notes Payable. Information with respect to the issuance of common stock upon the exercise of common stock purchase warrants issued to finders and placement agents in connection with the Private Placement of the Series G 1.5% Convertible Preferred Stock is provided above at Series G 1.5% Convertible Preferred Stock. Common Stock Warrants In connection with a private placement of debt on June 25, 2012, the Company issued to Samyang two-year detachable warrants to purchase 4,000,000 shares of the Companys common stock at a fixed exercise price of $0.056 per share. The warrants had a call right for consideration of $0.001 per share, in favor of the Company, to the extent that the weighted average closing price of the Companys common stock exceeded $0.084 per share for each of ten consecutive trading days, subject to certain circumstances. The warrants expired unexercised in June 2014. Information with respect to the issuance and exercise of common stock purchase warrants with respect to finders and placement agents in connection with the private placement of the Series G 1.5% Convertible Preferred Stock is provided above at Series G 1.5% Convertible Preferred Stock. Information with respect to the issuance of common stock purchase warrants in connection with the 10% Convertible Note Payable and Warrant Purchase Agreement is provided at Note 4. A summary of warrant activity for the three months ended March 31, 2015 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Warrants outstanding at December 31, 2014 25,686,096 $ 0.01744 Issued 6,419,998 0.03500 Exercised Expired Warrants outstanding at March 31, 2015 32,106,094 $ 0.02095 2.08 Warrants exercisable at December 31, 2014 25,686,096 $ 0.01744 Warrants exercisable at March 31, 2015 32,106,094 $ 0.02095 2.08 The exercise prices of common stock warrants outstanding and exercisable are as follows at March 31, 2015: Exercise Price Warrants Outstanding (Shares) Warrants Exercisable (Shares) Expiration Date $ 0.00396 14,531,953 14,531,953 April 17, 2019 $ 0.03500 17,574,141 17,574,141 September 15, 2015 32,106,094 32,106,094 Based on a fair market value of $0.0491 per share on March 31, 2015, the intrinsic value of exercisable in-the-money stock warrants was $903,768 as of March 31, 2015. A summary of warrant activity for the three months ended March 31, 2014 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Warrants outstanding at December 31, 2013 4,000,000 $ 0.05600 Issued Exercised Expired Warrants outstanding at March 31, 2014 4,000,000 $ 0.05600 0.24 Warrants exercisable at December 31, 2013 4,000,000 $ 0.05600 Warrants exercisable at March 31, 2014 4,000,000 $ 0.05600 0.24 The exercise prices of common stock warrants outstanding and exercisable are as follows at March 31, 2014: Exercise Price Warrants Outstanding (Shares) Warrants Exercisable (Shares) Expiration Date $ 0.056 4,000,000 4,000,000 June 25, 2014 Based on a fair market value of $0.0352 per share on March 31, 2014, there were no exercisable in-the-money common stock warrants as of March 31, 2014. Stock Options In connection with the initial closing of the Private Placement completed on March 18, 2014, the stockholders of the Company holding a majority of the votes to be cast on the issue approved the adoption of the Companys 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan (the 2014 Plan), which had been previously adopted by the Board of Directors of the Company, subject to stockholder approval. The Plan permits the grant of options and restricted stock with respect to up to 105,633,002 shares of common stock, in addition to stock appreciation rights and phantom stock, to directors, officers, employees, consultants and other service providers of the Company. During the three months ended March 31, 2014, the Company executed settlement agreements with four former executives that resulted in the settlement of potential claims totaling $1,336,264. In conjunction with such settlement agreements, the Company issued stock options to purchase 4,300,000 shares of common stock exercisable at $0.042 per share for periods ranging from five to ten years. The stock options were valued pursuant to the Black-Scholes option-pricing model at $179,910. During the three months ended June 30, 2014, the Company executed settlement agreements with two former professional service providers that resulted in the settlement of potential claims totaling $496,514. In conjunction with such settlement agreements, the Company issued stock options to purchase 1,250,000 shares of common stock exercisable at $0.04 per share for a period of five years. The stock options were valued pursuant to the Black-Scholes option-pricing model at $42,250. On July 17, 2014, the Board of Directors of the Company awarded stock options to purchase a total of 15,000,000 shares of common stock of the Company, consisting of options for 5,000,000 shares to each of the Companys three executive officers, who were also all of the directors of the Company at that time. The stock options were awarded as compensation for those individuals through December 31, 2014. The stock options vested in three equal installments on July 17, 2014 (at issuance), September 30, 2014, and December 31, 2014, and expire on July 17, 2019. The exercise price of the stock options was established on the grant date at $0.05 per share, as compared to the closing market price of the Companys common stock on such date of $0.044 per share, reflecting an exercise price premium of $0.006 per share or 13.6%. These awards were made under the Companys 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan. During the period July 17, 2014 through December 31, 2014, the Company recorded charges to operations of $655,500 with respect to these stock options, reflecting the grant date fair value of the stock options calculated pursuant to the Black-Scholes option-pricing model. Effective January 29, 2015, the Company executed a settlement agreement with its former Vice President and Chief Financial Officer, as amended on February 4, 2015, that resulted in the settlement of potential claims. In conjunction with such settlement agreement, the Company issued stock options to purchase 500,000 shares of common stock exercisable at $0.0512 per share for a period of five years. The stock options were valued pursuant to the Black-Scholes option-pricing model at $25,450. Information with respect to common stock awards issued to officers and directors as compensation is provided above under Common Stock. A summary of stock option activity for the three months ended March 31, 2015 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Options outstanding at December 31, 2014 25,716,668 $ 0.050 Granted 500,000 0.051 Expired Forfeited Options outstanding at March 31, 2015 26,216,668 $ 0.050 5.20 Options exercisable at December 31, 2014 25,716,668 $ 0.050 Options exercisable at March 31, 2015 26,216,668 $ 0.050 5.20 As of March 31, 2015, all outstanding options were fully vested. Accordingly, there was no deferred compensation expense to be recognized in future periods for outstanding but unvested stock options. The exercise prices of common stock options outstanding and exercisable were as follows at March 31, 2015: Exercise Price Options Outstanding (Shares) Options Exercisable (Shares) Expiration Date $ 0.040 2,400,000 2,400,000 March 13, 2019 $ 0.040 1,250,000 1,250,000 April 14, 2019 $ 0.043 1,100,000 1,100,000 March 14, 2024 $ 0.049 800,000 800,000 February 28, 2024 $ 0.050 15,000,000 15,000,000 July 17, 2019 $ 0.051 500,000 500,000 January 29, 2020 $ 0.060 3,083,334 3,083,334 July 17, 2022 $ 0.060 2,083,334 2,083,334 August 10, 2022 26,216,668 26,216,668 Based on a fair market value of $0.0491 per share on March 31, 2015, the intrinsic value of exercisable in-the-money stock options was $40,005 as of March 31, 2015. A summary of stock option activity for the three months ended March 31, 2014 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Options outstanding at December 31, 2013 5,166,668 $ 0.060 Granted 4,300,000 0.042 Expired Forfeited Options outstanding at March 31, 2014 9,466,668 $ 0.052 7.80 Options exercisable at December 31, 2013 5,166,668 $ 0.060 Options exercisable at March 31, 2014 9,466,668 $ 0.052 7.80 The exercise prices of common stock options outstanding and exercisable were as follows at March 31, 2014: Exercise Price Options Outstanding (Shares) Options Exercisable (Shares) Expiration Date $ 0.040 2,400,000 2,400,000 March 13, 2019 $ 0.043 1,100,000 1,100,000 March 14, 2024 $ 0.049 800,000 800,000 February 28, 2024 $ 0.060 3,083,334 3,083,334 July 17, 2022 $ 0.060 2,083,334 2,083,334 August 10, 2022 9,466,668 9,466,668 Based on a fair market value of $0.0352 per share on March 31, 2013, there were no exercisable in-the-money common stock options as of March 31, 2014. For the three months ended March 31, 2015 and 2014, stock-based compensation costs included in the statements of operations consisted of general and administrative expenses of $0 and $2,280,000, respectively, and research and development expenses of $72,000 and $0, respectively. Pier Contingent Stock Consideration In connection with the merger transaction with Pier effective August 10, 2012, Cortex issued 58,417,893 newly issued shares of its common stock with an aggregate fair value of $3,271,402 ($0.056 per share), based upon the closing price of Cortexs common stock on August 10, 2012. The shares of common stock were issued to stockholders, convertible note holders, warrant holders, option holders, and certain employees and vendors of Pier in satisfaction of their interests and claims. The common stock issued by Cortex represented approximately 41% of the 144,041,556 common shares outstanding immediately following the closing of the transaction. Pursuant to the terms of the transaction, Cortex agreed to issue additional contingent consideration, consisting of up to 18,314,077 shares of common stock, to Piers former security holders and certain other creditors and service providers (the Pier Stock Recipients) that received the Companys common stock as part of the Pier transaction if certain of the Companys stock options and warrants outstanding immediately prior to the closing of the merger were subsequently exercised. In the event that such contingent shares were issued, the ownership percentage of the Pier Stock Recipients, following their receipt of such additional shares, could not exceed their ownership percentage as of the initial transaction date. The stock options and warrants outstanding at June 30, 2012 were all out-of-the-money on August 10, 2012. During late July and early August 2012, the Company issued options to officers and directors at that time to purchase a total of 7,361,668 shares of common stock exercisable for ten years at $0.06 per share. By October 1, 2012, these options, as well as the options and warrants outstanding at June 30, 2012, were also out-of-the-money and continued to be out-of-the-money through December 31, 2014. There were no stock options or warrants exercised subsequent to August 10, 2012 that triggered additional contingent consideration, and the only remaining stock options outstanding that could still trigger the additional contingent consideration generally remained out-of-the-money through March 31, 2015. As of March 31, 2015, 2,111,445 contingent shares of common stock remained issuable under the Pier merger agreement due to expirations and forfeitures of stock options and warrants occurring since August 10, 2012. The Company concluded that the issuance of any of the contingent shares to the Pier Stock Recipients was remote, given the large spread between the exercise prices of these stock options and warrants as compared to the common stock trading range, the subsequent expiration or forfeiture of most of the options and warrants, the Companys distressed financial condition and capital requirements, and that these stock options and warrants have generally remained out-of-the-money through March 31, 2015, and have continued to expire, as time passes. Accordingly, the Company considered the fair value of the contingent consideration to be immaterial and therefore did not ascribe any value to such contingent consideration. If any such shares are ultimately issued to the former Pier stockholders, the Company will recognize the fair value of such shares as a charge to operations at that time. Common Shares Reserved for Issuance As of March 31, 2015, the Company had reserved an aggregate of |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 8. Related Party Transactions Dr. Arnold S. Lippa and Jeff E. Margolis, officers and directors of the Company since March 22, 2013, have indirect ownership interests in Aurora Capital LLC through interests held in its members, and Jeff. E. Margolis is also an officer of Aurora Capital LLC. Aurora Capital LLC is a boutique investment banking firm specializing in the life sciences sector that is also a full service brokerage firm. On March 31, 2013, the Company accrued $85,000 as reimbursement for legal fees incurred by Aurora Capital LLC in conjunction with the removal of the Companys prior Board of Directors on March 22, 2013, which amount has been included.in accounts payable and accrued expenses at March 31, 2015 and 2014. During the three months ended March 31, 2015, the Company charged $10,000 to operations for consulting services rendered by an entity controlled by family members of Dr. Arnold S. Lippa. See Note 7 for a description of other transactions between the Company and Aurora Capital LLC. See Notes 4 and 7 for a description of transactions with Samyang, a significant stockholder of and lender to the Company. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 9. Commitments and Contingencies Pending or Threatened Legal Actions and Claims The Company is periodically the subject of various pending and threatened legal actions and claims. In the opinion of management of the Company, adequate provision has been made in the Companys financial statements with respect to such matters. A former director of the Company, who joined the Companys Board of Directors on August 10, 2012 in conjunction with the Pier transaction and who resigned from the Companys Board of Directors on September 28, 2012, has asserted certain claims for consulting compensation against the Company. In the opinion of management, the Company has made adequate provision for any liability relating to this matter in its consolidated financial statements at March 31, 2015 and December 31, 2014. As of March 31, 2015 and December 31, 2014, the Companys patent legal counsel had recorded a lien against certain of the Companys patents and patent applications relating to its ampakine technology in the United States Patent and Trademark Office with respect to outstanding delinquent invoices payable to the law firm, which are included in accounts payable and accrued expenses in the Companys consolidated balance sheets at March 31, 2015 and December 31, 2014. On April 8, 2015, the Company entered into a Settlement Agreement and General Release (the Settlement Agreement) with the law firm to settle this outstanding obligation. Additional information with respect to this settlement is provided at Note 10. University of California, Irvine License Agreements The Company entered into a series of license agreements in 1993 and 1998 with UCI that granted the Company proprietary rights to certain chemical compounds that acted as ampakines and their therapeutic uses. These agreements granted the Company, among other provisions, exclusive rights: (i) to practice certain patents and patent applications, as defined in the license agreement, that were then held by UCI; (ii) to identify, develop, make, have made, import, export, lease, sell, have sold or offer for sale any related licensed products; and (iii) to grant sub-licenses of the rights granted in the license agreements, subject to the provisions of the license agreements. The Company was required, among other terms and conditions, to pay UCI a license fee, royalties, patent costs and certain additional payments. Under such license agreements, the Company was required to make minimum annual royalty payments of approximately $70,000. The Company was also required to spend a minimum of $250,000 per year to advance the ampakine compounds until the Company began to market an ampakine compound. The commercialization provisions in the agreements with UCI required the Company to file for regulatory approval of an ampakine compound before October 2012. In March 2011, UCI agreed to extend the required date for filing regulatory approval of an ampakine compound to October 2015. During December 2012, the Company informed UCI that it would be unable to make the annual payment due to a lack of funds. The Company believes that this notice, along with its subsequent failure to make its minimum annual payment obligation, constituted a default and termination of the license agreements. On April 15, 2013, the Company received a letter from UCI indicating that the license agreements between UCI and the Company had been terminated due to the Companys failure to make certain payments required to maintain the agreements. Since the patents covered in these license agreements had begun to expire and the therapeutic uses described in these patents were no longer germane to the Companys new focus on respiratory disorders, the loss of these license agreements is not expected to have a material impact on the Companys current drug development programs. In the opinion of management, the Company has made adequate provision for any liability relating to this matter in its consolidated financial statements at March 31, 2015 and December 31, 2014. University of Alberta License Agreement On May 8, 2007, the Company entered into a license agreement, as amended, with the University of Alberta granting the Company exclusive rights to practice patents held by the University of Alberta claiming the use of ampakines for the treatment of various respiratory disorders. The Company agreed to pay the University of Alberta a licensing fee and a patent issuance fee, which were paid, and prospective payments consisting of a royalty on net sales, sublicense fee payments, maintenance payments and milestone payments. The prospective maintenance payments commence on the enrollment of the first patient into the first Phase 2B clinical trial and increase upon the successful completion of the Phase 2B clinical trial. As the Company does not at this time anticipate scheduling a Phase 2B clinical trial, no maintenance payments are currently due and payable to the University of Alberta. In addition, no other prospective payments are currently due and payable to the University of Alberta. University of Illinois 2014 Exclusive License Agreement On June 27, 2014, the Company entered into an Exclusive License Agreement (the 2014 License Agreement) with the University of Illinois, the material terms of which were similar to the License Agreement between the parties that had been previously terminated on March 21, 2013. The 2014 License Agreement became effective on September 18, 2014, upon the completion of certain conditions set forth in the 2014 License Agreement, including (i) the payment by the Company of a $25,000 licensing fee, (ii) the payment by the Company of outstanding patent costs aggregating $15,840, and (iii) the assignment to the University of Illinois of rights the Company held in certain patent applications, all of which conditions were fulfilled. The 2014 License Agreement granted the Company (i) exclusive rights to several issued and pending patents in numerous jurisdictions and (ii) the non-exclusive right to certain technical information that is generated by the University of Illinois in connection with certain clinical trials as specified in the 2014 License Agreement, all of which relate to the use of cannabinoids for the treatment of sleep related breathing disorders. The Company is developing dronabinol (Δ9-tetrahydrocannabinol), a cannabinoid, for the treatment of OSA, the most common form of sleep apnea. The 2014 License Agreement provides for various commercialization and reporting requirements commencing on June 30, 2015. In addition, the 2014 License Agreement provides for various royalty payments, including a royalty on net sales of 4%, payment on sub-licensee revenues of 12.5%, and a minimum annual royalty beginning in 2015 of $100,000. In the year after the first application is submitted for market approval to the FDA and until approval is obtained, the minimum annual royalty will increase to $150,000. In the year after the first market approval is obtained from the FDA and until the first sale of a product, the minimum annual royalty will increase to $200,000. In the year after the first commercial sale of a product, the minimum annual royalty will increase to $250,000. During the three months ended March 31, 2015, the Company recorded a charge to operations of $25,000 with respect to its 2015 minimum annual royalty obligation, which was included in research and development expenses, with a corresponding credit to accounts payable and accrued liabilities. The 2014 License Agreement also provides for certain one-time milestone payments. A payment of $75,000 is due within five days after any one of the following: (a) dosing of the first patient with a product in a Phase 2 human clinical study anywhere in the world that is not sponsored by the University of Illinois, (b) dosing of the first patient in a Phase 2 human clinical study anywhere in the world with a low dose of dronabinol, or (c) dosing of the first patient in a Phase 1 human clinical study anywhere in the world with a proprietary reformulation of dronabinol. A payment of $350,000 is due within five days after dosing of the first patient with a product in a Phase 3 human clinical trial anywhere in the world. A payment of $500,000 is due within five days after the first new drug application filing with the FDA or a foreign equivalent for a product. A payment of $1,000,000 is due within 12 months after the first commercial sale of a product. National Institute on Drug Abuse Grant On September 18, 2014, the Company entered into a contract with the National Institute on Drug Abuse, a division of the National Institutes of Health. The funding under the contract was a Phase 1 award granted under the Small Business Innovation Research Funding Award Program. The purpose of the project was to determine the most useful route of administration for injecting CX1942, the Companys proprietary, soluble ampakine molecule, a potential rescue medication for drug-induced respiratory depression and lethality. The grant was entitled Novel Treatment of Drug-Induced Respiratory Depression and was valued at $148,583, which was paid in increments over the duration of the study which commenced in October 2014 and was completed in April 2015. The study was conducted in rats and measured the ability of CX1942, when injected by various routes of administration, to antagonize the respiratory depression produced by opiates and various combinations of respiratory depressant drugs. The primary measures were potency, latency to onset and duration of action of CX1942. The Company anticipates that the data obtained from this study will be used to determine the designs of preclinical studies necessary for initiating Phase 1 clinical studies. The preclinical studies were performed in collaboration with Dr. David Fuller of the University of Florida and Dr. John Greer of the University of Alberta, Chairman of the Companys Scientific Advisory Board. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | 10. Subsequent Events The Company performed an evaluation of subsequent events through the date of filing of these financial statements with the SEC, noting no additional items requiring disclosure, other than the items disclosed below. Settlements On June 29, 2015, the Companys settlement agreement with its former Vice President and Chief Financial Officer effective January 29, 2015, as amended on February 4, 2015, was further amended, resulting in a cash payment of $3,000, an extension of the $15,500 remaining balance due, plus the issuance of a stock option to purchase 50,000 shares of common stock exercisable at $0.018 per share (the closing market price on the date of grant) for a period of five years, and valued pursuant to the Black-Scholes option-pricing model at $840. On April 8, 2015, the Company entered into a Settlement Agreement with its patent legal counsel to settle amounts due to such firm for services rendered and costs incurred with respect to foreign associates and outside vendors aggregating $194,736. Pursuant to the terms of the Settlement Agreement, the law firm received a cash payment of $15,000, non-qualified stock options to purchase 2,520,442 shares of common stock exercisable at $0.0476 per share for a period of five years, and a short-term unsecured note payable in the principal amount of $59,763. The stock options were valued pursuant to the Black-Scholes option-pricing model at $119,217, based on the closing price of the Companys common stock on April 8, 2015 of $0.0476 per share. The note payable bears interest at 10% per annum, which accrues and is payable at maturity, and is due at the earlier of (i) the closing of a transaction for the sale of the Companys capital stock that results in net proceeds to the Company of at least $2,000,000, or (ii) December 31, 2015. In addition to various other provisions, the Settlement Agreement provides that the Company will have the option to pay for one-half of invoices for future legal services (excluding costs with respect to foreign associates and outside vendors) in the form of stock options. The Settlement Agreement also includes a release of the lien previously filed by the law firm against certain of the Companys patents and patent applications relating to its ampakine technology in the United States Patent and Trademark Office, as well as for mutual releases. During the three months and six months ended June 30, 2015, the Company executed agreements with four current professional service providers (including the Companys current patent legal counsel referred to above) that resulted in the partial settlement of amounts owed to them by the Company. Obligations in the amount of $916,827 were settled for $15,000 in cash, the issuance of a note payable in the amount of $59,763, the issuance of 9,064,286 shares of common stock valued at $158,625 ($0.0175 per share), which was the then closing market price of the Companys common stock, and the issuance of stock options to purchase 31,618,470 shares of common stock exercisable at the closing market price of the Companys common stock on the date of issuance. Options for 2,520,442 shares were exercisable at $0.0476 per share for a period of five years, and valued pursuant to the Black-Scholes option-pricing model at an aggregate of $119,217 ($0.0473 per share). Options for 29,098,028 shares were exercisable at $0.0175 per share for a period of five years, and valued pursuant to the Black-Scholes option-pricing model at an aggregate of $488,847 ($0.0168 per share). Conversions of Series G 1.5% Convertible Preferred Stock During the period from April 1, 2015 through June 30, 2015, an aggregate of 538.208190 shares of Series G 1.5% Convertible Preferred Stock, including 8.728190 dividend shares, were converted into 163,093,392 shares of common stock on a cashless basis. There have been no conversions of Series G 1.5% Convertible Preferred Stock into common stock subsequent to June 30, 2015. Note Payable to Chairman On June 16, 2015, Dr. Arnold S. Lippa advanced $40,000 to the Company in order to meet working capital requirements. The advance is due on demand with interest at 10% per annum. As of June 30, 2015, accrued interest was $164. 2015 Stock and Stock Option Plan On June 30, 2015, the Board of Directors adopted the 2015 Stock and Stock Option Plan (the 2015 Plan), which is substantially in the form of the 2014 Plan, except that the 2015 Plan does not provide for incentive stock options, stock appreciation rights and phantom stock, and does provide for a seven year exercise period, cashless and net exercise rights, as well as enhanced transferability. The 2015 Plan also provides for, among other things, the issuance of either or any combination of restricted shares of common stock and non-qualified stock options to purchase up to 150,000,000 shares of the Companys common stock, to management, members of the Board of Directors, consultants and advisors. The Company does not intend to present the 2015 Plan to shareholders for approval. Issuance of Stock Options On June 30, 2015, the Board of Directors of the Company awarded stock options to purchase a total of 55,000,000 shares of common stock, consisting of options for 15,000,000 shares to each of three of the Companys executive officers, Dr. Arnold S. Lippa, Jeff E. Margolis and Robert N. Weingarten, and options for 2,000,000 shares to each of five other members of management, the Companys Scientific Advisory Board, and independent members of the Board of Directors. The stock options were awarded as partial compensation for those individuals through December 31, 2015. The stock options vested 50% on June 30, 2015 (at issuance), will vest 25% on September 30, 2015 and December 31, 2015, and will expire on June 30, 2022. The exercise price of the stock options was established on the grant date at $0.025 per share, as compared to the closing market price of the Companys common stock on such date of $0.0175 per share, reflecting an exercise price premium of $0.0075 per share or 42.9%. These awards were made under the Companys 2015 Plan. The grant date fair value of these stock options calculated pursuant to the Black-Scholes option-pricing model was $473,000. Cash Compensation Arrangements with Officers and Directors On June 30, 2015, the Board of Directors of the Company awarded cash bonuses totaling $215,000, including an aggregate of $195,000 to certain of the Companys executive officers and an aggregate of $20,000 to the independent members of the Companys Board of Directors. The cash bonuses awarded to executive officers were as follows: Dr. Arnold S. Lippa - $75,000; Jeff E. Margolis - $60,000; and Robert N. Weingarten - $60,000. The cash bonuses awarded to the two independent members of the Companys Board of Directors were as follows: James E. Sapirstein - $10,000; and Kathryn MacFarlane - $10,000. The cash bonuses totaling $215,000 were awarded as partial compensation for services rendered by such persons from January 1, 2015 through June 30, 2015. On June 30, 2015, the Board of Directors also established cash compensation arrangements for certain of the Companys executive officers at the following monthly rates: Dr. Arnold S. Lippa - $12,500; Jeff E. Margolis - $10,000; and Robert N. Weingarten - $10,000. In addition, the Company established quarterly cash board fees for the two independent members of the Companys Board of Directors as follows: James E. Sapirstein - $10,000; and Kathryn MacFarlane - $10,000. This compensation is payable in arrears and will commence on July 1, 2015 and continue through December 31, 2015, unless further revised as a result of new developments. Both the cash bonuses and the cash monthly compensation will be accrued but not paid until such time as the Board of Directors of the Company determines that sufficient capital has been raised by the Company or is otherwise available to fund the Companys operations on an ongoing basis. Partnership with the Knowledge Translation Strategy Unit of the Canadian Institutes of Health Research On June 30, 2015, the Company announced a partnership with the Knowledge Translation Strategy Unit of the Canadian Institutes of Health Research. Through collaboration with John Greer, Ph.D., Chairman of the Companys Scientific Advisory Board and Professor of Physiology and Alberta Innovates Health Solutions Senior Scientist with the Neuroscience and Mental Health Institute at the University of Alberta, a research grant has been awarded by the Canadian Institutes of Health Research in the approximate amount of CAD$145,000 (approximately US$110,000) to partially fund the development of CX1942 and related compounds for the alleviation of various forms of respiratory depression. As the Principal Investigator, Dr. Greer will be heading the research and development effort. The Company intends to provide approximately CAD$85,000 (approximately US$65,000) of funding ratably over a period of approximately one year beginning in October 2015 to underwrite additional costs budgeted under this research grant. The data generated by this research grant will belong to the Company. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements are prepared in accordance with United States generally accepted accounting principles (GAAP) and include the financial statements of Cortex and its wholly-owned subsidiary, Pier. Intercompany balances and transactions have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts may differ from those estimates. |
Concentrations of Credit Risk | Concentrations of Credit Risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents. The Company limits its exposure to credit risk by investing its cash with high quality financial institutions. The Companys cash balances may periodically exceed federally insured limits. The Company has not experienced a loss in such accounts to date. |
Cash Equivalents | Cash Equivalents The Company considers all highly liquid short-term investments with maturities of less than three months when acquired to be cash equivalents. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The authoritative guidance with respect to fair value established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels, and requires that assets and liabilities carried at fair value be classified and disclosed in one of three categories, as presented below. Disclosure as to transfers into and out of Levels 1 and 2, and activity in Level 3 fair value measurements, is also required. Level 1. Observable inputs such as quoted prices in active markets for an identical asset or liability that the Company has the ability to access as of the measurement date. Financial assets and liabilities utilizing Level 1 inputs include active-exchange traded securities and exchange-based derivatives. Level 2. Inputs, other than quoted prices included within Level 1, which are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange based derivatives, mutual funds, and fair-value hedges. Level 3. Unobservable inputs in which there is little or no market data for the asset or liability which requires the reporting entity to develop its own assumptions. Financial assets and liabilities utilizing Level 3 inputs include infrequently-traded, non-exchange-based derivatives and commingled investment funds, and are measured using present value pricing models. The Company determines the level in the fair value hierarchy within which each fair value measurement falls in its entirety, based on the lowest level input that is significant to the fair value measurement in its entirety. In determining the appropriate levels, the Company performs an analysis of the assets and liabilities at each reporting period end. The Company believes that the carrying amount of its financial instruments (consisting of cash, cash equivalents, grants receivable and accounts payable) approximates fair value due to the short-term nature of such instruments. With respect to the note payable to a related party and the convertible notes payable, management does not believe that the credit markets have materially changed for these types of speculative borrowings since the original borrowing date. |
Deferred and Capitalized Financing Costs | Deferred and Capitalized Financing Costs Costs incurred in connection with ongoing financing activities, including legal and other professional fees, cash finders and placement agent fees, and escrow agent fees, are deferred until the related financing is either completed or abandoned. Costs related to completed debt financings are capitalized on the balance sheet and amortized over the term of the related debt agreements. Amortization of these costs is calculated on the straight-line basis, which approximates the effective interest method, and is charged to interest expense in the consolidated statements of operations. Costs related to completed equity financings are charged directly to additional paid-in capital. Costs related to abandoned financings are charged to operations. |
Series G 1.5% Convertible Preferred Stock | Series G 1.5% Convertible Preferred Stock The Series G 1.5% Convertible Preferred Stock (including accrued dividends) issued in 2014 is mandatorily convertible into common stock at a fixed conversion rate on April 17, 2016 (if not converted earlier) and has no right to cash at any time or for any reason. Additionally, the Series G 1.5% Convertible Preferred Stock has no participatory or reset rights, or other protections (other than normal anti-dilution rights) based on subsequent events, including equity transactions. Accordingly, the Company has determined that the Series G 1.5% Convertible Preferred Stock should be categorized in stockholders equity (deficiency), and that there are no derivatives embedded in such security that would require identification, bifurcation and valuation. The Company did not issue any warrants to investors in conjunction with the Series G 1.5% Convertible Preferred Stock financing. On March 18, 2014 and April 17, 2014, the Company issued 753.22 shares and 175.28 shares, respectively, of Series G 1.5% Convertible Preferred Stock at a purchase price of $1,000 per share. Each share of Series G 1.5% Convertible Preferred Stock has a stated value of $1,000 per share and is convertible into shares of common stock at a fixed price of $0.0033 per share. On March 18, 2014 and April 17, 2014, the per share fair value of the common stock into which the Series G 1.5% Convertible Preferred Stock was convertible, determined by reference to the closing market prices of the Companys common stock on such closing dates, was $0.04 per share and $0.0348 per share, respectively, which was greater than the effective purchase price of such common shares of $0.0033 per share. The Company accounted for the beneficial conversion features in accordance with Accounting Standards Codification (ASC) 470-20, Accounting for Debt with Conversion and Other Options. The Company calculated a deemed dividend on the Series G 1.5% Convertible Preferred Stock of $8,376,719 in March 2014 and $1,673,127 in April 2014, which equals the amount by which the estimated fair value of the common stock issuable upon conversion of the issued Series G 1.5% Convertible Preferred Stock exceeded the proceeds from such issuances. The deemed dividend on the Series G 1.5% Convertible Preferred Stock was amortized on the straight-line basis from the respective issuance dates through the earliest conversion date of June 16, 2014, in accordance with ASC 470-20. The difference between the amortization of the deemed dividend calculated based on the straight-line method and the effective yield method was not material. The amortization of the deemed dividend for the three months ended March 31, 2014 was $1,209,970. Dr. Arnold S. Lippa, Ph.D., the Companys Chairman, Chief Executive Officer and a member of the Companys Board of Directors, purchased 250 shares for $250,000, representing 33.2% of the 753.22 shares of Series G 1.5% Convertible Preferred Stock sold in the initial closing of such financing on March 18, 2014. The second (and final) closing of such financing consisted entirely of Series G 1.5% Convertible Preferred Stock sold to unaffiliated investors. Accordingly, Dr. Lippa purchased 26.9% of the entire amount of Series G 1.5% Convertible Preferred Stock sold in the financing. Dr. Lippa had been an officer and director of the Company for approximately one year when he purchased the 250 shares of Series G 1.5% Convertible Preferred Stock, and his investment, which was only a portion of the first closing, was made on the same terms and conditions as those provided to the other unaffiliated investors who made up the majority of the financing. Dr. Lippa did not control, directly or indirectly, 10% or more of the Companys voting equity securities at the time of his investment. The proportionate share of the deemed dividend attributable to Dr. Lippas investment in the Series G 1.5% Convertible Preferred Stock in March 2014 was $2,780,303. |
10% Convertible Notes Payable | 10% Convertible Notes Payable The convertible notes sold to investors in 2014 and 2015 have an interest rate of 10% per annum and are convertible into common stock at a fixed price of $0.035 per share. The convertible notes have no reset rights or other protections based on subsequent equity transactions, equity-linked transactions or other events. The warrants issued in connection with the sale of the convertible notes were detachable and are exercisable at a fixed price of $0.035 per share, have no right to cash at any time or under any circumstances, and have no reset rights or other protections based on subsequent equity transactions, equity-linked transactions or other events. Accordingly, the Company has determined that there are no embedded derivatives to be identified, bifurcated and valued in connection with this financing. On November 5, 2014, the Company sold an aggregate principal amount of $238,500 of its 10% convertible notes payable due September 15, 2015 (subject to extension to September 15, 2016, at the option of the Company, subject to the issuance of additional warrants) and warrants to purchase shares of common stock exercisable into a fixed number of shares of common stock of the Company calculated as the principal amount of each convertible note divided by $0.035 (i.e., 100% warrant coverage). The warrants do not have any cashless exercise provisions and are exercisable through September 30, 2015 at a fixed price of $0.035 per share. The shares of common stock issuable upon conversion of the notes payable and the exercise of the warrants are not subject to any registration rights. On December 9, 2014, December 31, 2014, and February 2, 2015, the Company sold an additional $46,000, $85,000 and $210,000, respectively, of principal amount of the convertible notes and warrants to various accredited investors. The Company terminated this financing effective February 18, 2015. The closing market prices of the Companys common stock on the transaction closing dates of November 5, 2014, December 9, 2014, December 31, 2014 and February 2, 2015 were $0.0524 per share, $0.0411 per share, $0.0451 per share and $0.043 per share, respectively, as compared to the fixed conversion price of the convertible notes and the fixed exercise price of the warrants of $0.035 per share. Accordingly, the Company has accounted for the beneficial conversion features with respect to the sale of the convertible notes and the issuance of the warrants in accordance with ASC 470-20, Accounting for Debt with Conversion and Other Options. The Company considered the face value of the convertible notes to be representative of their fair value. The Company determined the fair value of the warrants based on the Black-Scholes option-pricing model. The relative fair value method generated respective fair values for each of the convertible notes and the warrants of approximately 52% for the convertible notes and approximately 48% for the warrants. Once these values were determined, the fair value of the warrants of $176,549 and the fair value of the beneficial conversion feature of $192,951 (which were calculated based on the effective conversion price) were recorded as a reduction to the face value of the promissory note obligation. As a result, this aggregate debt discount reduced the carrying value of the convertible notes to zero at each issuance date. The excess amount generated from this calculation was not recorded, as the carrying value of a promissory note cannot be reduced below zero. The aggregate debt discount is being amortized as interest expense over the life of the promissory notes. The difference between the amortization of the debt discount calculated based on the straight-line method and the effective yield method was not material. The cash fees paid to finders and for legal costs were deferred and capitalized as deferred offering costs and are being amortized to interest expense over the life of the promissory notes. The finders warrants were considered as an additional cost of the offering and were included in deferred offering costs at fair value. The difference between the amortization of the deferred offering costs calculated based on the straight-line method and the effective yield method was not material. |
Equipment | Equipment Equipment is recorded at cost and depreciated on a straight-line basis over their estimated useful lives, which range from three to five years. |
Long-Term Prepaid Insurance | Long-Term Prepaid Insurance Long-term prepaid insurance represents the premium paid for directors and officers insurance tail coverage, which is being amortized on a straight-line basis over the policy period of six years. The amount amortizable in the ensuing twelve month period is recorded as a current asset in the Companys consolidated balance sheet at each reporting date. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews its long-lived assets, including long-term prepaid insurance, for impairment whenever events or changes in circumstances indicate that the total amount of an asset may not be recoverable, but at least annually. An impairment loss is recognized when estimated future cash flows expected to result from the use of the asset and its eventual disposition is less than the assets carrying amount. The Company has not deemed any long-lived assets as impaired at March 31, 2015. |
Stock-Based Compensation | Stock-Based Compensation The Company periodically issues common stock and stock options to officers, directors, Scientific Advisory Board members and consultants for services rendered. Such issuances vest and expire according to terms established at the issuance date of each grant. The Company accounts for stock-based payments to officers and directors by measuring the cost of services received in exchange for equity awards based on the grant date fair value of the awards, with the cost recognized as compensation expense on the straight-line basis in the Companys financial statements over the vesting period of the awards. The Company accounts for stock-based payments to Scientific Advisory Board members and consultants by determining the value of the stock compensation based upon the measurement date at either (a) the date at which a performance commitment is reached or (b) at the date at which the necessary performance to earn the equity instruments is complete. Stock grants, which are generally time vested, are measured at the grant date fair value and charged to operations over the vesting period. Options granted to members of the Companys Scientific Advisory Board and to outside consultants are revalued each reporting period until vested to determine the amount to be recorded as an expense in the respective period. As the options vest, they are valued on each vesting date and an adjustment is recorded for the difference between the value already recorded and the value on the date of vesting. All stock-based payments to employees, including grants of employee stock options, are recognized in the financial statements based on their fair values. The fair value of stock options is determined utilizing the Black-Scholes option-pricing model, and is affected by several variables, the most significant of which are the life of the equity award, the exercise price of the security as compared to the fair market value of the common stock on the grant date, and the estimated volatility of the common stock over the term of the equity award. Estimated volatility is based on the historical volatility of the Companys common stock. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant. The fair value of common stock is determined by reference to the quoted market price of the Companys common stock. Stock options and warrants issued to non-employees as compensation for services to be provided to the Company or in settlement of debt are accounted for based upon the fair value of the services provided or the estimated fair value of the option or warrant, whichever can be more clearly determined. Management utilizes the Black-Scholes option-pricing model to determine the fair value of the stock options and warrants issued by the Company. The Company recognizes this expense over the period in which the services are provided. For options granted during the three months ended March 31, 2015, the fair value of each option award was estimated using the Black-Scholes option-pricing model with the following assumptions: Risk-free interest rate 1.3 % Expected dividend yield 0 % Expected volatility 249 % Expected life 5 years For options granted during the three months ended March 31, 2014, the fair value of each option award was estimated using the Black-Scholes option-pricing model with the following assumptions: Risk-free interest rate 1.5% to 2.7 % Expected dividend yield 0 % Expected volatility 200 % Expected life 5-10 years The Company issues new shares to satisfy stock option and warrant exercises. There were no options exercised during the three months ended March 31, 2015 and 2014. The Company recognizes the fair value of stock-based compensation in general and administrative costs and in research and development costs, as appropriate, in the Companys consolidated statements of operations. |
Income Taxes | Income Taxes The Company accounts for income taxes under an asset and liability approach for financial accounting and reporting for income taxes. Accordingly, the Company recognizes deferred tax assets and liabilities for the expected impact of differences between the financial statements and the tax basis of assets and liabilities. The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized. In the event the Company was to determine that it would be able to realize its deferred tax assets in the future in excess of its recorded amount, an adjustment to the deferred tax assets would be credited to operations in the period such determination was made. Likewise, should the Company determine that it would not be able to realize all or part of its deferred tax assets in the future, an adjustment to the deferred tax assets would be charged to operations in the period such determination was made. Pursuant to Internal Revenue Code Sections 382 and 383, use of the Companys net operating loss and credit carryforwards may be limited if a cumulative change in ownership of more than 50% occurs within any three-year period since the last ownership change. The Company may have had a change in control under these Sections. However, the Company does not anticipate performing a complete analysis of the limitation on the annual use of the net operating loss and tax credit carryforwards until the time that it anticipates it will be able to utilize these tax attributes. As of March 31, 2015, the Company did not have any unrecognized tax benefits related to various federal and state income tax matters and does not anticipate any material amount of unrecognized tax benefits within the next 12 months. The Company is subject to U.S. federal income taxes and income taxes of various state tax jurisdictions. As the Companys net operating losses have yet to be utilized, all previous tax years remain open to examination by Federal authorities and other jurisdictions in which the Company currently operates or has operated in the past. The Company accounts for uncertainties in income tax law under a comprehensive model for the financial statement recognition, measurement, presentation and disclosure of uncertain tax positions taken or expected to be taken in income tax returns as prescribed by GAAP. The tax effects of a position are recognized only if it is more-likely-than-not to be sustained by the taxing authority as of the reporting date. If the tax position is not considered more-likely-than-not to be sustained, then no benefits of the position are recognized. As of March 31, 2015, the Company had not recorded any liability for uncertain tax positions. In subsequent periods, any interest and penalties related to uncertain tax positions will be recognized as a component of income tax expense. |
Foreign Currency Transactions | Foreign Currency Transactions The note payable to related party, which is denominated in a foreign currency (the South Korean Won), is translated into the Companys functional currency (the United States Dollar) at the exchange rate on the balance sheet date. The foreign currency exchange gain or loss resulting from translation is recognized in the related consolidated statements of operations. |
Research Grants | Research Grants The Company recognizes revenues from research grants as earned based on the percentage-of-completion method of accounting and issues invoices for contract amounts billed based on the terms of the grant agreement. Revenues recorded under research grants in excess of amounts earned are classified as unearned grant revenue liability in the Companys consolidated balance sheet. Grant receivable reflects contractual amounts due and payable under the grant agreement. The payment of grant receivables is based on progress reports provided by the Company. As of March 31, 2015, the Company was current in filing the required progress reports, as a result of which no allowance for uncollectible amounts was considered necessary. Research grants are generally funded and paid through government or institutional programs. Amounts received under research grants are nonrefundable, regardless of the success of the underlying research project, to the extent that such amounts are expended in accordance with the approved grant project. During the three months ended March 31, 2015, the Company had research grant revenues of $74,534. At March 31, 2015 and December 31, 2014, the Company had grant receivable of $28,583 and $48,000, respectively, and unearned grant revenues of $12,382 and $34,333, respectively. The Company had no research grant revenues during the three months ended March 31, 2014. |
Research and Development Costs | Research and Development Costs Research and development costs consist primarily of fees paid to consultants and outside service providers and organizations (including research institutes at universities), patent fees and costs, and other expenses relating to the acquisition, design, development and testing of the Companys treatments and product candidates. Research and development costs incurred by the Company under research grants are expensed as incurred over the life of the underlying contracts, unless the terms of the contract indicate that a different expensing schedule is more appropriate. The Company reviews the status of its research and development contracts on a quarterly basis. |
License Agreements | License Agreements Obligations incurred with respect to mandatory payments provided for in license agreements are recognized ratably over the appropriate period, as specified in the underlying license agreement, and are recorded as liabilities in the Companys consolidated balance sheet, with a corresponding charge to research and development costs in the Companys consolidated statement of operations. Obligations incurred with respect to milestone payments provided for in license agreements are recognized when it is probable that such milestone will be reached, and are recorded as liabilities in the Companys consolidated balance sheet, with a corresponding charge to research and development costs in the Companys consolidated statement of operations. Payments of such liabilities are made in the ordinary course of business. |
Patent Costs | Patent Costs Due to the significant uncertainty associated with the successful development of one or more commercially viable products based on the Companys research efforts and any related patent applications, all patent costs, including patent-related legal and filing fees, are expensed as incurred. |
Comprehensive Income (Loss) | Comprehensive Income (Loss) Components of comprehensive income or loss, including net income or loss, are reported in the financial statements in the period in which they are recognized. Comprehensive income or loss is defined as the change in equity during a period from transactions and other events and circumstances from non-owner sources. Net income (loss) and other comprehensive income (loss) are reported net of any related tax effect to arrive at comprehensive income (loss). The Company did not have any items of comprehensive income (loss) for the three months ended March 31, 2015 and 2014. |
Earnings per Share | Earnings per Share The Companys computation of earnings per share (EPS) includes basic and diluted EPS. Basic EPS is measured as the income (loss) attributable to common stockholders divided by the weighted average common shares outstanding for the period. Diluted EPS is similar to basic EPS but presents the dilutive effect on a per share basis of potential common shares (e.g., warrants and options) as if they had been converted at the beginning of the periods presented, or issuance date, if later. Potential common shares that have an anti-dilutive effect (i.e., those that increase income per share or decrease loss per share) are excluded from the calculation of diluted EPS. Net income (loss) attributable to common stockholders consists of net income or loss, as adjusted for actual and deemed preferred stock dividends declared, amortized or accumulated. Loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the respective periods. Basic and diluted loss per common share is the same for all periods presented because all warrants and stock options outstanding are anti-dilutive. At March 31, 2015 and 2014, the Company excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. March 31, 2015 2014 Series B convertible preferred stock 3,679 3,679 Series G 1.5% convertible preferred stock 257,760,939 228,372,117 10% convertible notes payable 17,034,702 Common stock warrants 32,106,094 4,000,000 Common stock options 26,216,668 9,466,668 Total 333,122,082 241,842,464 |
Reclassifications | Reclassifications Certain comparative figures in 2014 have been reclassified to conform to the current years presentation. These reclassifications were immaterial, both individually and in the aggregate. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-09 (ASU 2014-09), Revenue from Contracts with Customers In August 2014, the FASB issued Accounting Standards Update No. 2014-15 (ASU 2014-15), Presentation of Financial Statements Going Concern (Subtopic 205-10) In January 2015, the FASB issued Accounting Standards Update No. 2015-01 (ASU 2015-01), Income Statement Extraordinary and Unusual Items (Subtopic 225-20). In February 2015, the FASB issued Accounting Standards Update No. 2015-02 (ASU 2015-02), Consolidation (Topic 810). In April 2015, the FASB issued Accounting Standards Update No. 2015-03 (ASU 2015-03), Interest Imputation of Interest (Subtopic 835-30) In April 2015, the FASB issued Accounting Standards Update No. 2015-05 (ASU 2015-05), Intangibles Goodwill and Other Internal-Use Software (Subtopic 350-40). Management does not believe that any other recently issued, but not yet effective, authoritative guidance, if currently adopted, would have a material impact on the Companys financial statement presentation or disclosures. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Schdule of Condensed Consolidated Financial Statements | Companys condensed consolidated financial statements as of and for the three months ended March 31, 2015 is presented below. March 31, 2015 As Reported As Restated Condensed Consolidated Balance Sheet: Assets: Total current assets $ 318,589 $ 318,589 Total assets $ 395,083 $ 395,083 Liabilities and Stockholders Deficiency: Total current liabilities $ 2,873,439 $ 3,003,259 Total liabilities 2,873,439 3,003,259 Total stockholders deficiency (2,478,356 ) (2,608,176 ) Total liabilities and stockholders deficiency $ 395,083 $ 395,083 Three Months Ended March 31, 2015 As Reported As Restated Condensed Consolidated Statement of Operations: Revenues $ 74,534 $ 74,534 Total operating expenses 540,872 670,692 Loss from operations (466,338 ) (596,158 ) Net loss (598,132 ) (727,952 ) Net loss attributable to common stockholders (601,330 ) (731,150 ) Net loss per common share basic and diluted $ (0.00 ) $ (0.00 ) Three Months Ended March 31, 2015 As Reported As Restated Condensed Consolidated Statement of Cash Flows: Net cash used in operating activities $ (200,403 ) $ (200,403 ) Net cash used in investing activities (2,497 ) (2,497 ) Net cash provided by financing activities 194,300 194,300 Net increase (decrease) in cash (8,600 ) (8,600 ) Balance at beginning of period 162,752 162,752 Balance at end of period $ 154,152 $ 154,152 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Fair Value of Option Estimated Using Black-Scholes Pricing Model with Valuation Assumptions | For options granted during the three months ended March 31, 2015, the fair value of each option award was estimated using the Black-Scholes option-pricing model with the following assumptions: Risk-free interest rate 1.3 % Expected dividend yield 0 % Expected volatility 249 % Expected life 5 years For options granted during the three months ended March 31, 2014, the fair value of each option award was estimated using the Black-Scholes option-pricing model with the following assumptions: Risk-free interest rate 1.5% to 2.7 % Expected dividend yield 0 % Expected volatility 200 % Expected life 5-10 years |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | At March 31, 2015 and 2014, the Company excluded the outstanding securities summarized below, which entitle the holders thereof to acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. March 31, 2015 2014 Series B convertible preferred stock 3,679 3,679 Series G 1.5% convertible preferred stock 257,760,939 228,372,117 10% convertible notes payable 17,034,702 Common stock warrants 32,106,094 4,000,000 Common stock options 26,216,668 9,466,668 Total 333,122,082 241,842,464 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Notes Payable | The 10% Convertible Notes Payable consist of the following at March 31, 2015 and December 31, 2014: March 31, 2015 December 31, 2014 Principal amount of notes payable $ 579,500 $ 369,500 Add accrued interest payable 16,715 4,093 596,215 373,593 Less unamortized discounts: Stock warrants (185,145 ) (155,264 ) Beneficial conversion feature (182,209 ) (168,086 ) $ 228,861 $ 50,243 |
Summary of Note Payable to Related Party | Note payable to Samyang consists of the following at March 31, 2015 and December 31, 2014: March 31, 2015 December 31, 2014 Principal amount of note payable $ 399,774 $ 399,774 Accrued interest payable 134,611 122,618 Foreign currency transaction adjustment (325 ) 3,865 $ 534,060 $ 526,257 |
Stockholders' Deficiency (Table
Stockholders' Deficiency (Tables) | 3 Months Ended |
Mar. 31, 2015 | |
Equity [Abstract] | |
Schedule of Warrants Activity | A summary of warrant activity for the three months ended March 31, 2015 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Warrants outstanding at December 31, 2014 25,686,096 $ 0.01744 Issued 6,419,998 0.03500 Exercised Expired Warrants outstanding at March 31, 2015 32,106,094 $ 0.02095 2.08 Warrants exercisable at December 31, 2014 25,686,096 $ 0.01744 Warrants exercisable at March 31, 2015 32,106,094 $ 0.02095 2.08 A summary of warrant activity for the three months ended March 31, 2014 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Warrants outstanding at December 31, 2013 4,000,000 $ 0.05600 Issued Exercised Expired Warrants outstanding at March 31, 2014 4,000,000 $ 0.05600 0.24 Warrants exercisable at December 31, 2013 4,000,000 $ 0.05600 Warrants exercisable at March 31, 2014 4,000,000 $ 0.05600 0.24 |
Exercise Prices of Common Stock Warrants Outstanding and Exercisable | The exercise prices of common stock warrants outstanding and exercisable are as follows at March 31, 2015: Exercise Price Warrants Outstanding (Shares) Warrants Exercisable (Shares) Expiration Date $ 0.00396 14,531,953 14,531,953 April 17, 2019 $ 0.03500 17,574,141 17,574,141 September 15, 2015 32,106,094 32,106,094 The exercise prices of common stock warrants outstanding and exercisable are as follows at March 31, 2014: Exercise Price Warrants Outstanding (Shares) Warrants Exercisable (Shares) Expiration Date $ 0.056 4,000,000 4,000,000 June 25, 2014 |
Schedule of Stock Options Activity | A summary of stock option activity for the three months ended March 31, 2015 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Options outstanding at December 31, 2014 25,716,668 $ 0.050 Granted 500,000 0.051 Expired Forfeited Options outstanding at March 31, 2015 26,216,668 $ 0.050 5.20 Options exercisable at December 31, 2014 25,716,668 $ 0.050 Options exercisable at March 31, 2015 26,216,668 $ 0.050 5.20 A summary of stock option activity for the three months ended March 31, 2014 is presented below. Number of Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Life (in Years) Options outstanding at December 31, 2013 5,166,668 $ 0.060 Granted 4,300,000 0.042 Expired Forfeited Options outstanding at March 31, 2014 9,466,668 $ 0.052 7.80 Options exercisable at December 31, 2013 5,166,668 $ 0.060 Options exercisable at March 31, 2014 9,466,668 $ 0.052 7.80 |
Exercise Prices of Common Stock Options Outstanding and Exercisable | The exercise prices of common stock options outstanding and exercisable were as follows at March 31, 2015: Exercise Price Options Outstanding (Shares) Options Exercisable (Shares) Expiration Date $ 0.040 2,400,000 2,400,000 March 13, 2019 $ 0.040 1,250,000 1,250,000 April 14, 2019 $ 0.043 1,100,000 1,100,000 March 14, 2024 $ 0.049 800,000 800,000 February 28, 2024 $ 0.050 15,000,000 15,000,000 July 17, 2019 $ 0.051 500,000 500,000 January 29, 2020 $ 0.060 3,083,334 3,083,334 July 17, 2022 $ 0.060 2,083,334 2,083,334 August 10, 2022 26,216,668 26,216,668 The exercise prices of common stock options outstanding and exercisable were as follows at March 31, 2014: Exercise Price Options Outstanding (Shares) Options Exercisable (Shares) Expiration Date $ 0.040 2,400,000 2,400,000 March 13, 2019 $ 0.043 1,100,000 1,100,000 March 14, 2024 $ 0.049 800,000 800,000 February 28, 2024 $ 0.060 3,083,334 3,083,334 July 17, 2022 $ 0.060 2,083,334 2,083,334 August 10, 2022 9,466,668 9,466,668 |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Research and development costs | $ 440,792 | $ 64,089 |
Vendor [Member] | ||
Research and development costs | $ 129,821 |
Basis of Presentation - Schdule
Basis of Presentation - Schdule of Condensed Consolidated Financial Statements (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | |
Total current assets | $ 318,589 | $ 320,673 | |
Total assets | 395,083 | 400,308 | |
Total current liabilities | 3,003,259 | 2,600,708 | |
Total liabilities | 3,003,259 | ||
Total stockholders' deficiency | (2,608,176) | (2,200,400) | |
Total liabilities and stockholders' deficiency | 395,083 | 400,308 | |
Revenues | 74,534 | ||
Total operating expenses | 670,692 | $ 2,412,196 | |
Loss from operations | (596,158) | (2,412,196) | |
Net loss | (727,952) | (1,380,710) | (2,707,535) |
Net loss attributable to common stockholders | $ (731,150) | $ (2,591,088) | |
Net loss per common share - basic and diluted | $ 0 | $ (.02) | |
Net cash used in operating activities | $ (200,403) | $ (313,759) | (885,869) |
Net cash used in investing activities | (2,497) | (1,925) | |
Net cash provided by financing activities | 194,300 | 613,264 | |
Net increase (decrease) in cash | (8,600) | 297,580 | |
Balance at beginning of period | 162,752 | 14,352 | 14,352 |
Balance at end of period | 154,152 | $ 311,932 | 162,752 |
As Reported [Member] | |||
Total current assets | 318,589 | ||
Total assets | 395,083 | ||
Total current liabilities | 2,873,439 | ||
Total liabilities | 2,873,439 | ||
Total stockholders' deficiency | (2,478,356) | ||
Total liabilities and stockholders' deficiency | 395,083 | ||
Revenues | 74,534 | ||
Total operating expenses | 540,872 | ||
Loss from operations | (466,338) | ||
Net loss | (598,132) | ||
Net loss attributable to common stockholders | $ (601,330) | ||
Net loss per common share - basic and diluted | $ 0 | ||
Net cash used in operating activities | $ (200,403) | ||
Net cash used in investing activities | (2,497) | ||
Net cash provided by financing activities | 194,300 | ||
Net increase (decrease) in cash | (8,600) | ||
Balance at beginning of period | 162,752 | ||
Balance at end of period | $ 154,152 | $ 162,752 |
Organization and Business Ope27
Organization and Business Operations (Details Narrative) - USD ($) | Aug. 10, 2012 | Apr. 30, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2014 | Feb. 28, 2015 |
Percentage of pier issued and outstanding share acquire | 100.00% | ||||||
Net loss | $ 727,952 | $ 1,380,710 | $ 2,707,535 | ||||
Negative operating cash flows | $ 200,403 | $ 313,759 | 885,869 | ||||
Percentage of dividend on convertible preferred stock | 1.50% | ||||||
Sale of convertible notes (with warrants), aggregate principal amount | $ 210,000 | ||||||
Various Accredited Investors [Member] | November And December 2014 [Member] | |||||||
Sale of convertible notes (with warrants), aggregate principal amount | $ 369,500 | ||||||
Series G 1.5% Cumulative Mandatorily Convertible Preferred Stock [Member] | |||||||
Sale of preferred stock | 928.5 | ||||||
Percentage of dividend on convertible preferred stock | 1.50% | ||||||
Invested in preferred stock | $ 928,500 | ||||||
Series G 1.5% Cumulative Mandatorily Convertible Preferred Stock [Member] | Chairman and Chief Executive Officer [Member] | |||||||
Percentage of dividend on convertible preferred stock | 1.50% | ||||||
Invested in preferred stock | $ 250,000 | ||||||
Chairman and Chief Executive Officer [Member] | |||||||
Short term loans advanced to the company | $ 150,000 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | Feb. 02, 2015 | Dec. 31, 2014 | Dec. 09, 2014 | Nov. 05, 2014 | Apr. 30, 2014 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 16, 2014 | Apr. 17, 2014 | Mar. 18, 2014 |
Common stock, price per share at closing dates | $ 0.0348 | $ 0.04 | ||||||||||
Common stock fixed price per share | $ 0.0033 | |||||||||||
Preferred stock deemed dividend value | $ 1,673,127 | $ 8,376,719 | ||||||||||
Amortization of deemed dividend value of preferred stock | $ 1,209,970 | |||||||||||
Voting equity securities on preferred stock | designated as 9% Cumulative Convertible Preferred Stock (non-voting, 9% Preferred Stock) | |||||||||||
Percentage of convertible notes payable | 10.00% | 10.00% | 10.00% | |||||||||
Convertible into common stock fixed price per share | $ 0.035 | $ 0.035 | ||||||||||
Debt instrument due date | Sep. 15, 2015 | Sep. 15, 2015 | Sep. 15, 2015 | Sep. 15, 2015 | Sep. 15, 2015 | |||||||
Fair value of convertible notes, percentage | 52.00% | |||||||||||
Fair value of warrants, percentage | 48.00% | |||||||||||
Fair value of beneficial conversion feature value | $ (83,320) | |||||||||||
Stock options granted | 500,000 | 4,300,000 | ||||||||||
Stock options exercised | ||||||||||||
Percentage of ownership | 50.00% | |||||||||||
Grant Revenues | $ 74,534 | |||||||||||
Grant receivable | $ 48,000 | 28,583 | $ 48,000 | |||||||||
Unearned grant revenue | $ 34,333 | $ 12,382 | ||||||||||
Comprehensive income (loss) | ||||||||||||
Equipment [Member] | Minimum [Member] | ||||||||||||
Furniture and equipment, estimated useful lives | 3 years | |||||||||||
Equipment [Member] | Maximum [Member] | ||||||||||||
Furniture and equipment, estimated useful lives | 5 years | |||||||||||
Closing Market Price [Member] | ||||||||||||
Closing market prices | $ 0.043 | $ 0.0411 | $ 0.0524 | $ 0.0451 | ||||||||
Series G 1.5% Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock, per share | $ 0.323705 | $ 0.68888 | ||||||||||
Deemed dividend on lippa's investment | 2,780,303 | |||||||||||
Proceeds from issuance of private placements | $ 443,848 | |||||||||||
10% Convertible Notes Payable [Member] | ||||||||||||
Proceeds from issuance of private placements | 85,000 | |||||||||||
10% Convertible Notes Payable [Member] | ||||||||||||
Proceeds from issuance of private placements | $ 210,000 | $ 46,000 | ||||||||||
Warrant Purchase Agreement [Member] | Various Accredited Investors [Member] | ||||||||||||
Percentage of convertible notes payable | 10.00% | |||||||||||
Proceeds from issuance | $ 238,500 | |||||||||||
Debt instrument due date | Sep. 15, 2015 | |||||||||||
Closing market prices | $ 0.035 | |||||||||||
Chairman and Chief Executive Officer [Member] | ||||||||||||
Preferred stock purchased | $ 250,000 | |||||||||||
Preferred stock purchased, shares | 250 | |||||||||||
Percentage of shares held on sale | 33.20% | |||||||||||
Percentage of purchase of convertible preferred stock | 26.90% | |||||||||||
Voting equity securities on preferred stock | Dr. Lippa did not control, directly or indirectly, 10% or more of the Companys voting equity securities at the time of his investment. | |||||||||||
Deemed dividend on lippa's investment | $ 1,209,970 | |||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | ||||||||||||
Convertible preferred stock issued | 175.28 | 753.22 | ||||||||||
Convertible preferred stock, per share | $ 1,000 | |||||||||||
Warrants [Member] | ||||||||||||
Closing market prices | $ 0.035 | |||||||||||
Fair value of warrants | $ 176,549 | |||||||||||
Fair value of beneficial conversion feature value | $ 192,951 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies - Summary of Fair Value of Option Estimated Using Black-Scholes Pricing Model with Valuation Assumptions (Details) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Risk-free interest rate | 1.30% | |
Risk-free interest rate, minimum | 1.50% | |
Risk-free interest rate, maximum | 2.70% | |
Expected dividend yield | 0.00% | 0.00% |
Expected volatility | 249.00% | 200.00% |
Expected life | 5 years | |
Minimum [Member] | ||
Expected life | 5 years | |
Maximum [Member] | ||
Expected life | 10 years |
Summary of Significant Accoun30
Summary of Significant Accounting Policies - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | 333,122,082 | 241,842,464 |
Common Stock Options [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | 26,216,668 | 9,466,668 |
Series B Convertible Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | 3,679 | 3,679 |
Series G 1.5% Convertible Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | 257,760,939 | 228,372,117 |
10% Convertible Notes Payable [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | 17,034,702 | |
Common Stock Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | 32,106,094 | 4,000,000 |
Notes Payable (Details Narrativ
Notes Payable (Details Narrative) - USD ($) | Feb. 02, 2015 | Dec. 31, 2014 | Dec. 09, 2014 | Nov. 05, 2014 | Jun. 25, 2013 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Feb. 28, 2015 | Dec. 31, 2014 | Mar. 03, 2015 | Jan. 02, 2015 | Dec. 31, 2013 |
Accrued note payable compounded annual interest percentage | 10.00% | 10.00% | 10.00% | 10.00% | 12.00% | 10.00% | 10.00% | ||||||
Private place ments terminated effect date | Jun. 25, 2013 | ||||||||||||
Debt instruments maturity date | Sep. 15, 2015 | Sep. 15, 2015 | Sep. 15, 2015 | Sep. 15, 2015 | Sep. 15, 2015 | ||||||||
Financing costs | $ 129,776 | ||||||||||||
Financing consisting costs related note payable paid in cash | $ 3,500 | $ 700 | $ 16,695 | 93,110 | |||||||||
Amortization of capitalized financing costs | $ 37,098 | ||||||||||||
Amortization of debt discount related value attributed beneficial conversion feature | $ 83,320 | ||||||||||||
Stockholder's percentage | 20.00% | ||||||||||||
Detachable warrants, term | 3 years | ||||||||||||
Warrants expiration date | Jun. 25, 2014 | ||||||||||||
Payment of accrued interest | $ 102 | ||||||||||||
Dr. Arnold S. Lippa [Member] | |||||||||||||
Due to officer | $ 75,000 | ||||||||||||
Dr. Arnold S. Lippa [Member] | Maximum [Member] | |||||||||||||
Due to officer | $ 150,000 | ||||||||||||
Percentage of interest rate for due on demand working capital | 0.22% | ||||||||||||
Premium Financing Agreement [Member] | |||||||||||||
Accrued note payable compounded annual interest percentage | 5.08% | ||||||||||||
Ten Monthly Installments [Member] | Premium Financing Agreement [Member] | |||||||||||||
Debt periodic payment | $ 3,697 | ||||||||||||
10% Convertible Notes Payable [Member] | |||||||||||||
Fair value of warrant | $ 3,340 | ||||||||||||
Conversion of common stock | 17,034,702 | 10,674,107 | |||||||||||
Number of common shares attributable to accrued interest | 477,560 | 116,964 | |||||||||||
Accrued interest payable | $ 16,715 | ||||||||||||
10% Convertible Notes Payable [Member] | |||||||||||||
Proceeds from issuance of private placements | $ 210,000 | 85,000 | 46,000 | 238,500 | 579,500 | ||||||||
Value of placement warrants | $ 12,726 | $ 3,340 | $ 614 | $ 19,986 | $ 36,666 | ||||||||
Promissory Note [Member] | |||||||||||||
Early repayment of promissory note, date | Dec. 25, 2012 | ||||||||||||
Aurora Capital LLC [Member] | |||||||||||||
Debt conversion price | 3.50% | ||||||||||||
Percentage of common stock share convertible notes | 7.00% | ||||||||||||
Number of placement warrants | 420,000 | 100,000 | 20,000 | 477,000 | 1,017,000 | 100,000 | |||||||
Warrants issued for placement | 100,000 | ||||||||||||
Samyang Optics Co Inc [Member] | South Korean Won [Member] | |||||||||||||
Accrued interest payable | $ 4,093 | ||||||||||||
Secured note payable value | 465,000,000 | ||||||||||||
Samyang Optics Co Inc [Member] | US Dollars [Member] | |||||||||||||
Secured note payable value | $ 400,000 | ||||||||||||
Warrant Purchase Agreement [Member] | Various Accredited Investors [Member] | |||||||||||||
Private place ments terminated effect date | Sep. 15, 2015 | ||||||||||||
Debt instruments maturity date | Sep. 15, 2015 | ||||||||||||
Common stock exercisable price per share | $ 0.035 | ||||||||||||
Common shares issuable upon conversion | 6,814,286 | ||||||||||||
Warrant Purchase Agreement [Member] | Aurora Capital LLC [Member] | |||||||||||||
Financing cost paid in cash | $ 33,425 | ||||||||||||
Debt conversion price | 3.50% | ||||||||||||
Common shares issuable upon conversion | 955,000 | ||||||||||||
Warrants issued for placement | 16,557,141 | ||||||||||||
Amortization of debt discount | $ 83,320 |
Notes Payable - Schedule of Con
Notes Payable - Schedule of Convertible Notes Payable (Details) - 10% Convertible Notes Payable [Member] - USD ($) | Mar. 31, 2015 | Dec. 31, 2014 |
Principal amount of notes payable | $ 579,500 | $ 369,500 |
Add accrued interest payable | 16,715 | 4,093 |
Notes payable, gross | 596,215 | 373,593 |
Unamortized discount Stock warrants | (185,145) | (155,264) |
Unamortized discount-beneficial conversion Feature | (182,209) | (168,086) |
Convertible notes payable | $ 228,861 | $ 50,243 |
Notes Payable - Summary of Note
Notes Payable - Summary of Note Payable to Related Party (Details) - USD ($) | Mar. 31, 2015 | Dec. 31, 2014 |
Total note payable | $ 534,060 | $ 526,257 |
Samyang Optics Co Inc [Member] | ||
Principal amount of note payable | 399,774 | 399,774 |
Accrued interest payable | 134,611 | 122,618 |
Foreign currency transaction adjustment | (325) | 3,865 |
Total note payable | $ 534,060 | $ 526,257 |
Project Advance (Details Narrat
Project Advance (Details Narrative) | Sep. 02, 2014USD ($)$ / sharesshares | Jun. 30, 2000USD ($) | Mar. 31, 2015$ / shares | Dec. 31, 2014USD ($)$ / shares | Dec. 31, 2003Integer | Dec. 31, 2002Integer |
Stock issued, per share | $ / shares | $ 0.035 | $ 0.035 | ||||
Gain on settlement of project advance | $ 287,809 | |||||
Institute for Study of Aging [Member] | ||||||
Restricted common stock shares issued during period | shares | 1,000,000 | |||||
Common shares issued during period | shares | 1,000,000 | |||||
Common shares issued during period value | $ 49,000 | |||||
Stock issued, per share | $ / shares | $ 0.049 | |||||
MCI [Member] | ||||||
Proceeds from institute for study of aging to fund testing | $ 247,300 | |||||
Number of patients | Integer | 175 | 175 | ||||
Debt, accrued interest rate | one-half of the prime lending rate | |||||
Conversion price per share | $ / shares | $ 4.50 | |||||
Release Agreement [Member] | ||||||
Institute for initial principal amount | $ 336,809 | |||||
Accrued interest | $ 89,509 |
Settlements (Details Narrative)
Settlements (Details Narrative) | Jan. 29, 2015USD ($)$ / sharesshares | Sep. 02, 2014USD ($) | Mar. 31, 2015USD ($) | Jun. 30, 2014USD ($)Integer$ / sharesshares | Mar. 31, 2014USD ($)Integer$ / sharesshares | Dec. 31, 2014USD ($) | Sep. 18, 2014$ / shares | Sep. 03, 2014$ / shares |
Stock option exercise price per share | $ / shares | $ 0.066 | $ 0.049 | ||||||
Stock option period | 5 years | |||||||
Gain on settlements with former management | $ 1,038,270 | |||||||
Gain on settlements with service providers | $ 393,590 | |||||||
Gain on settlement of project advance | $ (287,809) | |||||||
Minimum [Member] | ||||||||
Stock option period | 5 years | |||||||
Maximum [Member] | ||||||||
Stock option period | 10 years | |||||||
Executed Settlement Agreements [Member] | ||||||||
Number of former executives | Integer | 4 | |||||||
Number of former service provider | Integer | 2 | |||||||
Portion of cash settlement paid | $ 496,514 | $ 1,336,264 | ||||||
Made cash payment to purchase common stock | $ 60,675 | $ 118,084 | ||||||
Issuance of stock options to purchase of common stock | shares | 1,250,000 | 4,300,000 | ||||||
Stock option exercise price per share | $ / shares | $ 0.04 | $ 0.04 | ||||||
Stock option period | 5 years | |||||||
Stock option fair value | $ 42,250 | $ 179,910 | ||||||
Gain on settlement of project advance | $ 287,809 | |||||||
Executed Settlement Agreements [Member] | Former Vice President and Chief Financial Officer [Member] | ||||||||
Stock option period | 5 years | |||||||
Stock option fair value | $ 25,450 | |||||||
Executed Settlement Agreements [Member] | Minimum [Member] | ||||||||
Stock option period | 5 years | |||||||
Executed Settlement Agreements [Member] | Maximum [Member] | ||||||||
Stock option period | 10 years | |||||||
Settlement Agreements [Member] | Former Vice President and Chief Financial Officer [Member] | ||||||||
Portion of cash settlement paid | $ 6,000 | $ 7,500 | ||||||
Issuance of stock options to purchase of common stock | shares | 500,000 | |||||||
Stock option exercise price per share | $ / shares | $ 0.0512 | |||||||
Stock option period | 5 years | |||||||
Stock option fair value | $ 25,450 | |||||||
Gain on settlement of project advance | $ 92,550 | |||||||
Settlement Agreements [Member] | Former Vice President and Chief Financial Officer [Member] | June 30, 2015 [Member] | ||||||||
Total settlement to be paid in cash | $ 26,000 |
Stockholders' Deficiency (Detai
Stockholders' Deficiency (Details Narrative) | Mar. 18, 2015USD ($)$ / sharesshares | Jan. 29, 2015USD ($)$ / sharesshares | Oct. 15, 2014USD ($)$ / sharesshares | Sep. 26, 2014shares | Sep. 18, 2014USD ($)$ / sharesshares | Sep. 05, 2014shares | Sep. 03, 2014$ / sharesshares | Aug. 25, 2014USD ($)shares | Jul. 17, 2014USD ($)shares | Jul. 17, 2014$ / sharesshares | Apr. 17, 2014USD ($)$ / sharesshares | Apr. 14, 2014USD ($) | Mar. 18, 2014$ / shares | Aug. 10, 2013USD ($)$ / sharesshares | Jun. 25, 2012$ / sharesshares | Aug. 31, 2013USD ($)$ / shares | Mar. 31, 2015USD ($)$ / sharesshares | Jun. 30, 2014USD ($)Integer$ / sharesshares | Mar. 31, 2014USD ($)Integer$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 16, 2014$ / sharesshares |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | ||||||||||||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | ||||||||||||||||||||
Preferred stock, shares designated | 1,250,000 | 1,250,000 | ||||||||||||||||||||
Preferred stock voting | designated as 9% Cumulative Convertible Preferred Stock (non-voting, 9% Preferred Stock) | |||||||||||||||||||||
Preferred stock, dividend percentage | 1.50% | |||||||||||||||||||||
Preferred stock shares issuable upon conversion | 264,465,728 | 264,465,728 | ||||||||||||||||||||
Fair value of stock awards | $ | $ 99,000 | $ 33,000 | ||||||||||||||||||||
Purchase price per share | $ / shares | $ 0.0348 | $ 0.04 | ||||||||||||||||||||
Common stock fixed price per share | $ / shares | $ 0.0033 | |||||||||||||||||||||
Common shares issuable upon conversion of series G | 257,760,939 | |||||||||||||||||||||
Common stock, shares authorized | 1,400,000,000 | 1,400,000,000 | 1,400,000,000 | |||||||||||||||||||
Awarded an aggregate shares to directors | 4,000,000 | |||||||||||||||||||||
Percentage of vesting appointment rate | 50.00% | |||||||||||||||||||||
Fair value of stock awards, per share | $ / shares | $ 0.066 | $ 0.049 | ||||||||||||||||||||
Stock awards value | $ | $ 196,000 | |||||||||||||||||||||
Percentage of awards vesting upon chairman appointment | 25.00% | |||||||||||||||||||||
Stock-based compensation expense | $ | 39,000 | |||||||||||||||||||||
Fair value of market price per share | $ / shares | $ 0.0491 | $ 0.0491 | ||||||||||||||||||||
Stock warrant intrinsic value of exercisable | $ | $ 903,768 | $ 903,768 | ||||||||||||||||||||
Stock option period | 5 years | |||||||||||||||||||||
Number of shares issuance upon exercise of stock options available for future grant | 25,633,002 | |||||||||||||||||||||
Common stock price per share | $ / shares | $ 0.035 | $ 0.035 | ||||||||||||||||||||
Common stock, shares outstanding | 240,819,176 | 232,145,326 | 232,145,326 | |||||||||||||||||||
Issuance of contingent shares of common stock | 2,111,445 | |||||||||||||||||||||
Issuance of stock upon exercise of outstanding stock options | 26,216,668 | |||||||||||||||||||||
Common stock issuable upon exercise of warrants | 32,106,094 | |||||||||||||||||||||
2014 Equity, Equity-Linked and Equity Derivative Incentive Plan [Member] | ||||||||||||||||||||||
Number of shares issuance upon exercise of stock options available for future grant | 105,633,002 | |||||||||||||||||||||
April 15, 2015 [Member] | ||||||||||||||||||||||
Stock-based compensation expense | $ | 39,000 | |||||||||||||||||||||
July 15, 2015 [Member] | ||||||||||||||||||||||
Stock-based compensation expense | $ | 39,000 | |||||||||||||||||||||
October 15, 2015 [Member] | ||||||||||||||||||||||
Stock-based compensation expense | $ | 39,000 | |||||||||||||||||||||
Placement Agents [Member] | Share-based Compensation Award, Tranche Two [Member] | ||||||||||||||||||||||
Preferred stock, dividend percentage | 1.50% | |||||||||||||||||||||
Received cash fees | $ | $ 3,465 | |||||||||||||||||||||
Percentage of common stock shares converted into convertible preferred stock | 12.00% | |||||||||||||||||||||
Convertible preferred stock exercisable period | 5 years | |||||||||||||||||||||
Percentage of conversion price of common stock | 120.00% | |||||||||||||||||||||
Proceeds from issuance of private placements | $ | $ 220,321 | |||||||||||||||||||||
Samyang Optics Co Inc [Member] | ||||||||||||||||||||||
Issuance of warrants to purchase of common stock | 4,000,000 | |||||||||||||||||||||
Warrants term | 2 years | |||||||||||||||||||||
Common stock at an exercise price | $ / shares | $ 0.056 | |||||||||||||||||||||
Warrants call right consideration price per share | $ / shares | 0.001 | |||||||||||||||||||||
Common stock exceeds price per share | $ / shares | $ 0.084 | |||||||||||||||||||||
Research And Development Expense [Member] | ||||||||||||||||||||||
Stock-based compensation expense | $ | $ 72,000 | $ 2,280,000 | ||||||||||||||||||||
Pier [Member] | ||||||||||||||||||||||
Additional common stock issued | 58,417,893 | |||||||||||||||||||||
Issuance of common stock | $ | $ 3,271,402 | |||||||||||||||||||||
Common stock price per share | $ / shares | $ 0.056 | |||||||||||||||||||||
Common stock, shares outstanding | 144,041,556 | |||||||||||||||||||||
Percentage of issuance of common stock | 41.00% | |||||||||||||||||||||
Pier Stock Recipients [Member] | ||||||||||||||||||||||
Additional common stock issued | 18,314,077 | |||||||||||||||||||||
Issuance of common stock | $ | $ 18,314,077 | |||||||||||||||||||||
Placement Agents [Member] | Share-based Compensation Award, Tranche Two [Member] | ||||||||||||||||||||||
Issuance of warrants to acquire common stock | 6,386,120 | |||||||||||||||||||||
Common stock fixed price per share | $ / shares | $ 0.00396 | |||||||||||||||||||||
Minimum [Member] | ||||||||||||||||||||||
Stock option period | 5 years | |||||||||||||||||||||
Maximum [Member] | ||||||||||||||||||||||
Stock option period | 10 years | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | ||||||||||||||||||||||
Preferred stock, shares authorized | 5,000,000 | |||||||||||||||||||||
Preferred stock, par value | $ / shares | $ 1,000 | |||||||||||||||||||||
Preferred stock, dividend percentage | 1.50% | |||||||||||||||||||||
Preferred stock, shares issued | 25.323705 | 66.68888 | ||||||||||||||||||||
Preferred stock shares issuable upon conversion, Per share | $ / shares | $ 0.323705 | $ 0.68888 | ||||||||||||||||||||
Preferred stock shares issuable upon conversion | 7,673,850 | 20,208,752 | ||||||||||||||||||||
Received cash fees | $ | $ 3,955 | |||||||||||||||||||||
Percentage of common stock shares converted into convertible preferred stock | 5.6365% | |||||||||||||||||||||
Convertible preferred stock exercisable period | 5 years | |||||||||||||||||||||
Percentage of conversion price of common stock | 120.00% | |||||||||||||||||||||
Proceeds from issuance of private placements | $ | $ 443,848 | |||||||||||||||||||||
Dividend preferred stock | $ | $ 3,198 | $ 408 | $ 10,926 | |||||||||||||||||||
Issuance of additional shares | $ / shares | $ 3.2 | $ 0.4 | $ 10.9 | |||||||||||||||||||
Common shares issuable upon conversion of series G | 303,030.3 | 281,363,634 | ||||||||||||||||||||
Preferred stock fixed conversation price per share | $ / shares | $ 0.0033 | |||||||||||||||||||||
Conversion share issuance upon convertible notes | $ | $ 17,034,702 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | 1.5% Dividend [Member] | ||||||||||||||||||||||
Preferred stock, dividend percentage | 1.50% | 1.50% | ||||||||||||||||||||
Preferred stock, shares issued | 257,760,939 | 264,465,728 | 264,465,728 | |||||||||||||||||||
Preferred stock shares issuable upon conversion | 3,973,063 | 3,102,094 | 3,102,094 | |||||||||||||||||||
Accrued interest | $ | $ 3,973,063 | $ 10,237 | $ 10,237 | |||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Warrants [Member] | ||||||||||||||||||||||
Preferred stock, shares authorized | 5,000,000 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Minimum [Member] | ||||||||||||||||||||||
Common stock, shares authorized | 1,400,000,000 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Minimum [Member] | Warrants [Member] | ||||||||||||||||||||||
Common stock, shares authorized | 1,400,000,000 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Maximum [Member] | ||||||||||||||||||||||
Common stock, shares authorized | 1,405,000,000 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Maximum [Member] | Warrants [Member] | ||||||||||||||||||||||
Common stock, shares authorized | 1,405,000,000 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | ||||||||||||||||||||||
Financing fee | $ | $ 2,800 | |||||||||||||||||||||
Purchase of warrants | 10,427,029 | |||||||||||||||||||||
Private placement representing the acquire number of share | 2,412,878 | 2,112,879 | ||||||||||||||||||||
Resulted issuance of common stock | 1,126,814 | 1,942,124 | ||||||||||||||||||||
Percentage of exercised cashless basic | 50.00% | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | 2014 Equity, Equity-Linked and Equity Derivative Incentive Plan [Member] | ||||||||||||||||||||||
Common stock fixed price per share | $ / shares | $ 0.04 | |||||||||||||||||||||
Percentage of Amount financing to paid the compensation | 81.00% | |||||||||||||||||||||
Series G 1.5% Cumulative Mandatorily Convertible Preferred Stock [Member] | ||||||||||||||||||||||
Private placement representing the acquire number of share | 1,400,000 | |||||||||||||||||||||
Resulted issuance of common stock | 1,326,080 | |||||||||||||||||||||
Executed Settlement Agreements [Member] | ||||||||||||||||||||||
Fair value of stock awards, per share | $ / shares | $ 0.04 | $ 0.04 | ||||||||||||||||||||
Number of former executives | Integer | 4 | |||||||||||||||||||||
Settlement of potential claims net | $ | $ 496,514 | $ 1,336,264 | ||||||||||||||||||||
Stock option period | 5 years | |||||||||||||||||||||
Option issued to purchase number of common stock | 1,250,000 | 4,300,000 | ||||||||||||||||||||
Stock option fair value | $ | $ 42,250 | $ 179,910 | ||||||||||||||||||||
Number of former service provider | Integer | 2 | |||||||||||||||||||||
Executed Settlement Agreements [Member] | Minimum [Member] | ||||||||||||||||||||||
Common stock at an exercise price | $ / shares | $ 0.042 | |||||||||||||||||||||
Stock option period | 5 years | |||||||||||||||||||||
Executed Settlement Agreements [Member] | Maximum [Member] | ||||||||||||||||||||||
Stock option period | 10 years | |||||||||||||||||||||
Pier Merger Agreement [Member] | ||||||||||||||||||||||
Issuance of contingent shares of common stock | 2,111,445 | |||||||||||||||||||||
Board Of Directors [Member] | ||||||||||||||||||||||
Preferred stock, shares undesignated | 3,505,800 | |||||||||||||||||||||
Number of stock shares awarded | 15,000,000 | 15,000,000 | ||||||||||||||||||||
Additional common stock issued | 5,000,000 | |||||||||||||||||||||
Fair value of stock option | $ | $ 655,500 | |||||||||||||||||||||
Option expiration date | Jul. 17, 2019 | |||||||||||||||||||||
Exercise price of the stock options | $ / shares | $ 0.05 | |||||||||||||||||||||
Chairman and Chief Executive Officer [Member] | ||||||||||||||||||||||
Preferred stock voting | Dr. Lippa did not control, directly or indirectly, 10% or more of the Companys voting equity securities at the time of his investment. | |||||||||||||||||||||
Chairman and Chief Executive Officer [Member] | Securities Purchase Agreements [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | $ 250,000 | |||||||||||||||||||||
Stock issued for services, Shares | 250 | |||||||||||||||||||||
Board of Directors Chairman [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | $ 57,000,000 | |||||||||||||||||||||
Executive One [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | 15,000,000 | |||||||||||||||||||||
Executive Two [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | 15,000,000 | |||||||||||||||||||||
Executive Three [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | 15,000,000 | |||||||||||||||||||||
Individual One [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | 4,000,000 | |||||||||||||||||||||
Individual Two [Member] | Aurora Capital LLC [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | $ 8,000,000 | |||||||||||||||||||||
Sapirstein and Katryn Macfarlane [Member] | ||||||||||||||||||||||
Awarded an aggregate shares to directors | 2,000,000 | |||||||||||||||||||||
Percentage of vesting appointment rate | 25.00% | |||||||||||||||||||||
Dr. Greer [Member] | ||||||||||||||||||||||
Number of stock shares awarded | 2,000,000 | |||||||||||||||||||||
Mr Purcell [Member] | ||||||||||||||||||||||
Awarded an aggregate shares to directors | 2,000,000 | |||||||||||||||||||||
Additional common stock issued | 2,000,000 | |||||||||||||||||||||
Percentage of stock vesting and issuable | 25.00% | |||||||||||||||||||||
Stock grant value | $ | $ 39,000 | |||||||||||||||||||||
Fair value of closing stock share per price | $ / shares | $ 0.078 | |||||||||||||||||||||
Former Vice President and Chief Financial Officer [Member] | Executed Settlement Agreements [Member] | ||||||||||||||||||||||
Stock option period | 5 years | |||||||||||||||||||||
Option issued to purchase number of common stock | 500,000 | |||||||||||||||||||||
Stock option fair value | $ | $ 25,450 | |||||||||||||||||||||
Former Vice President and Chief Financial Officer [Member] | Settlement Agreements [Member] | ||||||||||||||||||||||
Fair value of stock awards, per share | $ / shares | $ 0.0512 | |||||||||||||||||||||
Settlement of potential claims net | $ | $ 6,000 | $ 7,500 | ||||||||||||||||||||
Stock option period | 5 years | |||||||||||||||||||||
Stock option fair value | $ | $ 25,450 | |||||||||||||||||||||
Officer And Director [Member] | ||||||||||||||||||||||
Stock issued to for services | $ | $ 7,361,668 | |||||||||||||||||||||
Convertible preferred stock exercisable period | 10 years | |||||||||||||||||||||
Common stock at an exercise price | $ / shares | $ 0.06 | |||||||||||||||||||||
Series B Convertible Preferred Stock [Member] | ||||||||||||||||||||||
Preferred stock, shares authorized | 37,500 | 37,500 | 37,500 | |||||||||||||||||||
Preferred stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||||||||||
Preferred stock, liquidation preference per share | $ / shares | $ 0.6667 | $ 0.6667 | $ 0.6667 | |||||||||||||||||||
Preferred stock, shares issued | 37,500 | 37,500 | 37,500 | |||||||||||||||||||
Preferred stock conversion into common stock description | Each share of Series B Preferred Stock is convertible into approximately 0.09812 shares of common stock at an effective conversion price of $6.795 per share of common stock, which is subject to adjustment under certain circumstances. | Each share of Series B Preferred is convertible into approximately 0.09812 shares of common stock at an effective conversion price of $6.795 per share of common stock, subject to adjustment under certain circumstances. | ||||||||||||||||||||
Preferred stock shares issuable upon conversion, Per share | $ / shares | $ 0.09812 | $ 0.09812 | $ 0.09812 | |||||||||||||||||||
Effective conversion price per share of common stock | $ / shares | $ 6.795 | $ 6.795 | $ 6.795 | |||||||||||||||||||
Preferred stock shares issuable upon conversion | 3,679 | 3,679 | 3,679 | |||||||||||||||||||
Preferred stock redemption amount | $ | $ 25,001 | $ 25,001 | $ 25,001 | |||||||||||||||||||
Redeemed preferred stock price per share | $ / shares | $ 0.6667 | $ 0.6667 | $ 0.6667 | |||||||||||||||||||
Convertible preferred stock, shares reserved for future issuance | 3,679 | |||||||||||||||||||||
Series A Junior Participating Preferred Stock [Member] | ||||||||||||||||||||||
Preferred stock, shares authorized | 205,000 | 205,000 | ||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | ||||||||||||||||||||||
Preferred stock shares issuable upon conversion, Per share | $ / shares | $ 1,000 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Securities Purchase Agreements [Member] | ||||||||||||||||||||||
Fair value of stock awards | $ | $ 2,280,000 | |||||||||||||||||||||
Sale of preferred stock | 753.22 | 175.28 | ||||||||||||||||||||
Purchase price per share | $ / shares | $ 1,000 | |||||||||||||||||||||
Aggregate purchase amount of shares | $ | $ 753,220 | $ 175,280 | ||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Securities Purchase Agreements [Member] | Aurora Capital LLC [Member] | ||||||||||||||||||||||
Sale of preferred stock | 928.5 | |||||||||||||||||||||
Aggregate purchase amount of shares | $ | $ 928,500 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Placement Agents [Member] | ||||||||||||||||||||||
Convertible preferred stock exercisable period | 5 years | |||||||||||||||||||||
Resulted issuance of common stock | 19,251,271 | |||||||||||||||||||||
Percentage of conversion price of common stock | 120.00% | |||||||||||||||||||||
Preferred stock fixed conversation price per share | $ / shares | $ 0.00396 | |||||||||||||||||||||
Series G 1.5% Convertible Preferred Stock [Member] | Placement Agents [Member] | ||||||||||||||||||||||
Preferred stock shares issuable upon conversion, Per share | $ / shares | $ 1,000 | |||||||||||||||||||||
Sale of preferred stock | 928.5 | |||||||||||||||||||||
Common shares issuable upon conversion of series G | 303,030.3 | |||||||||||||||||||||
Preferred stock fixed conversation price per share | $ / shares | $ 0.0033 | |||||||||||||||||||||
Warrants [Member] | ||||||||||||||||||||||
Fair value of market price per share | $ / shares | $ 0.0352 | |||||||||||||||||||||
Stock warrant intrinsic value of exercisable | $ |
Stockholders' Deficiency - Sche
Stockholders' Deficiency - Schedule of Warrants Activity (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Equity [Abstract] | ||
Number of Warrants, Outstanding, Beginning balance | 25,686,096 | 4,000,000 |
Number of Warrants, Outstanding, Exercisable, Beginning balance | 25,686,096 | |
Number of Warrants, Issued | 6,419,998 | |
Number of Warrants, Exercised | ||
Number of Warrants, Expired | 4,000,000 | |
Weighted Average Exercise Price, Outstanding, Beginning | $ 0.01744 | $ 0.05600 |
Weighted Average Exercise Price, Exercisable Beginning | 0.01744 | |
Weighted Average Exercise Price, Issued | $ 0.03500 | |
Weighted Average Exercise Price, Exercised | ||
Weighted Average Exercise Price, Expired | $ 0.05600 | |
Warrants outstanding ,Weighted Average Remaining Contractual Life (in Years) | 2 years 8 months 27 days | 2 months 27 days |
Warrants exercisable, Weighted Average Remaining Contractual Life (in Years) | 2 years 8 months 27 days | 2 months 27 days |
Stockholders' Deficiency - Exer
Stockholders' Deficiency - Exercise Prices of Common Stock Warrants Outstanding and Exercisable (Details) - $ / shares | 3 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Warrants, Outstanding (Shares) | 25,686,096 | 4,000,000 | ||
Warrants, Exercisable (Shares) | 25,686,096 | |||
Warrants [Member] | ||||
Warrants, Outstanding (Shares) | 32,106,094 | |||
Warrants, Exercisable (Shares) | 32,106,094 | |||
Exercise Price Range One [Member] | Warrants [Member] | ||||
Warrants, Exercise Price | $ 0.00396 | $ 0.056 | ||
Warrants, Outstanding (Shares) | 14,531,953 | 4,000,000 | ||
Warrants, Exercisable (Shares) | 14,531,953 | 4,000,000 | ||
Warrants, Expiration Date | Apr. 17, 2019 | Jun. 25, 2014 | ||
Exercise Price Range Two [Member] | Warrants [Member] | ||||
Warrants, Exercise Price | $ 0.03500 | |||
Warrants, Outstanding (Shares) | 17,574,141 | |||
Warrants, Exercisable (Shares) | 17,574,141 | |||
Warrants, Expiration Date | Sep. 15, 2015 |
Stockholders' Deficiency - Sc39
Stockholders' Deficiency - Schedule of Stock Options Activity (Details) - $ / shares | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Equity [Abstract] | ||
Number of Options, Outstanding, Beginning balance | 25,716,668 | 5,166,668 |
Number of Options, Exercisable, Beginning balance | 25,716,668 | 5,166,668 |
Number of Options, Granted | 500,000 | 4,300,000 |
Number of Options, Expired | ||
Number of Options, Forfeited | 9,466,668 | |
Number of Options, Outstanding, Ending balance | 26,216,668 | 9,466,668 |
Number of Options, Exercisable, Ending balance | 26,216,668 | 9,466,668 |
Weighted Average Exercise Price, Outstanding, Beginning | $ 0.050 | $ 0.060 |
Weighted Average Exercise Price, Exercisable, Beginning | 0.050 | 0.060 |
Weighted Average Exercise Price, Granted | $ 0.051 | $ 0.042 |
Weighted Average Exercise Price, Expired | ||
Weighted Average Exercise Price, Forfeited | ||
Weighted Average Exercise Price, Outstanding, Ending | $ 0.052 | |
Weighted Average Exercise Price, Exercisable, Ending | $ 0.052 | |
Options Outstanding, Weighted Average Remaining Contractual Life (in Years) | 5 years 2 months 12 days | 7 years 9 months 18 days |
Options Exercisable, Weighted Average Remaining Contractual Life (in Years) | 5 years 2 months 12 days | 7 years 9 months 18 days |
Stockholders' Deficiency - Ex40
Stockholders' Deficiency - Exercise Prices of Common Stock Options Outstanding and Exercisable (Details) - $ / shares | 3 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | |
Options Outstanding (Shares) | 26,216,668 | 9,466,668 | 25,716,668 | 5,166,668 |
Options Exercisable (Shares) | 26,216,668 | 9,466,668 | 25,716,668 | 5,166,668 |
Stock Option One [Member] | ||||
Options Exercise Price | $ 0.040 | $ 0.040 | ||
Options Outstanding (Shares) | 2,400,000 | 2,400,000 | ||
Options Exercisable (Shares) | 2,400,000 | 2,400,000 | ||
Options, Expiration Date | Mar. 13, 2019 | Mar. 13, 2019 | ||
Stock Option Two [Member] | ||||
Options Exercise Price | $ 0.040 | $ 0.043 | ||
Options Outstanding (Shares) | 1,250,000 | 1,100,000 | ||
Options Exercisable (Shares) | 1,250,000 | 1,100,000 | ||
Options, Expiration Date | Apr. 14, 2019 | Mar. 14, 2024 | ||
Stock Option Three [Member] | ||||
Options Exercise Price | $ 0.043 | $ 0.049 | ||
Options Outstanding (Shares) | 1,100,000 | 800,000 | ||
Options Exercisable (Shares) | 1,100,000 | 800,000 | ||
Options, Expiration Date | Mar. 14, 2024 | Feb. 28, 2024 | ||
Stock Option Four [Member] | ||||
Options Exercise Price | $ 0.049 | $ 0.060 | ||
Options Outstanding (Shares) | 800,000 | 3,083,334 | ||
Options Exercisable (Shares) | 800,000 | 3,083,334 | ||
Options, Expiration Date | Feb. 28, 2024 | Jul. 17, 2022 | ||
Stock Option Five [Member] | ||||
Options Exercise Price | $ 0.050 | $ 0.060 | ||
Options Outstanding (Shares) | 15,000,000 | 2,083,334 | ||
Options Exercisable (Shares) | 15,000,000 | 2,083,334 | ||
Options, Expiration Date | Jul. 17, 2019 | Aug. 10, 2022 | ||
Stock Option Six [Member] | ||||
Options Exercise Price | $ 0.51 | |||
Options Outstanding (Shares) | 500,000 | |||
Options Exercisable (Shares) | 500,000 | |||
Options, Expiration Date | Jan. 29, 2020 | |||
Stock Option Seven [Member] | ||||
Options Exercise Price | $ 0.060 | |||
Options Outstanding (Shares) | 3,083,334 | |||
Options Exercisable (Shares) | 3,083,334 | |||
Options, Expiration Date | Jul. 17, 2022 | |||
Stock Option Eight [Member] | ||||
Options Exercise Price | $ 0.060 | |||
Options Outstanding (Shares) | 2,083,334 | |||
Options Exercisable (Shares) | 2,083,334 | |||
Options, Expiration Date | Aug. 10, 2022 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2013 | |
Aurora Capital LLC [Member] | ||
Reimbursement for legal fees accrued | $ 85,000 | |
Dr. Arnold S. Lippa [Member] | ||
Consulting fees paid to family member's | $ 10,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | Jun. 27, 2014 | Mar. 31, 2015 | Sep. 18, 2014 | May. 08, 2008 |
Minimum annual royalty payment amount | $ 70,000 | |||
Minimum amount to be spent to advance the ampakine compounds | 250,000 | |||
National Institute on Drug Abuse Grant [Member] | ||||
Value of noval treatment of drug induced respiratory depression | $ 148,583 | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | ||||
Minimum annual royalty payment amount | $ 100,000 | |||
License agreement effective date | Sep. 18, 2014 | |||
License fee | $ 25,000 | |||
Outstanding patent costs | $ 15,840 | |||
Percentage of royalty on net sale | 4.00% | |||
Percentage of payment on sub licensee revenue | 12.50% | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | Due Within Five Days After Closing Of First Patient Product Phase Two Human Clinical Study [Member] | ||||
Payment for sale of product | $ 75,000 | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | Due Within Five Days After Closing Of First Patient Product Phase Three Human Clinical Trial [Member] | ||||
Payment for sale of product | 350,000 | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | Due Within Five Days After First New Drug Application Filing [Member] | ||||
Payment for sale of product | 500,000 | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | Due Within Twelve Months After First Commercial Sale Of Product Member [Member] | ||||
Payment for sale of product | 1,000,000 | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | ResearchAndDevelopmentExpenses [Member] | ||||
Minimum annual royalty payment amount | 25,000 | |||
University Of Illinois 2014 Exclusive License Agreement [Member] | Maximum [Member] | ||||
Minimum annual royalty payment amount | 150,000 | |||
University of Alberta [Member] | ||||
Maintenance payments due and payable | $ 0 | |||
Other prospective payments due and payable | $ 0 | |||
First Sale Of Product [Member] | University Of Illinois 2014 Exclusive License Agreement [Member] | Maximum [Member] | ||||
Minimum annual royalty payment amount | 200,000 | |||
First Commercial Sale Of Product [Member] | University Of Illinois 2014 Exclusive License Agreement [Member] | Maximum [Member] | ||||
Minimum annual royalty payment amount | $ 250,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) | Jun. 29, 2015USD ($)$ / sharesshares | Jun. 16, 2015USD ($) | Apr. 08, 2015USD ($)$ / sharesshares | Jun. 30, 2015USD ($)$ / sharesshares | Mar. 31, 2015USD ($) | Mar. 31, 2014USD ($) | Jun. 30, 2015USD ($)$ / sharesshares | Jun. 30, 2015CADshares | Dec. 31, 2014USD ($) | Apr. 17, 2014$ / shares | Mar. 18, 2014$ / shares |
Sale of stock purchase price per share | $ / shares | $ 0.0348 | $ 0.04 | |||||||||
Notes payable related parties | $ 134,611 | $ 122,618 | |||||||||
Accrued interest | $ 750 | ||||||||||
Subsequent Event [Member] | Canadian Institutes of Health Research [Member] | |||||||||||
Partnership amount | $ 110,000 | $ 110,000 | |||||||||
Underwrite additional costs budgeted | $ 65,000 | $ 65,000 | |||||||||
Subsequent Event [Member] | Canadian Institutes of Health Research [Member] | Canadian $ [Member] | |||||||||||
Partnership amount | CAD | CAD 145,000 | ||||||||||
Underwrite additional costs budgeted | CAD | CAD 85,000 | ||||||||||
Subsequent Event [Member] | 2015 Stock and Stock Option Plan [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 150,000,000 | ||||||||||
Subsequent Event [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 55,000,000 | ||||||||||
Option exercisable per share | $ / shares | $ 0.025 | $ 0.025 | |||||||||
Black-Scholes option-pricing model | $ 473,000 | ||||||||||
Sale of stock purchase price per share | $ / shares | 0.0175 | $ 0.0175 | |||||||||
Percentage of stock options vested | 50.00% | ||||||||||
Stock option expiration date | Jun. 30, 2022 | ||||||||||
Options exercise price premium per share | $ / shares | $ 0.0075 | $ 0.0075 | |||||||||
Percentage of options exercise price premium | 42.90% | 42.90% | 42.90% | ||||||||
Subsequent Event [Member] | Series G 1.5% Convertible Preferred Stock [Member] | |||||||||||
Number of preferred stock converted into common stock | shares | 538.208190 | 538.208190 | 538.208190 | ||||||||
Number of preferred shares converted | shares | 8.728190 | 8.728190 | 8.728190 | ||||||||
Number of preferred dividend shares | shares | 163,093,392 | ||||||||||
Subsequent Event [Member] | September 30, 2015 [Member] | Issuance of Stock Options [Member] | |||||||||||
Percentage of stock options vested | 25.00% | ||||||||||
Subsequent Event [Member] | December 31, 2015 [Member] | Issuance of Stock Options [Member] | |||||||||||
Percentage of stock options vested | 25.00% | ||||||||||
Subsequent Event [Member] | Settlement Agreement [Member] | |||||||||||
Settlement in cash | $ 15,000 | $ 15,000 | |||||||||
Settlement amount due | $ 194,736 | ||||||||||
Issuance of options to purchase common stock shares | shares | 2,520,442 | 9,064,286 | |||||||||
Option exercisable per share | $ / shares | $ 0.0476 | $ 0.0175 | $ 0.0175 | ||||||||
Option expiration period | 5 years | ||||||||||
Note payable bear interest rate | 10.00% | ||||||||||
Proceeds from sale of capital stock | $ 2,000,000 | ||||||||||
Notes payable | 59,763 | $ 59,763 | $ 59,763 | ||||||||
Fair value option | $ 119,217 | ||||||||||
Agreement obligations amount due | 916,827 | ||||||||||
Issuance of options to purchase common stock | $ 158,625 | ||||||||||
Subsequent Event [Member] | Settlement Agreement [Member] | Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 31,618,470 | ||||||||||
Subsequent Event [Member] | Settlement Agreement [Member] | Options 1 [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 2,520,442 | ||||||||||
Option exercisable per share | $ / shares | $ 0.0476 | $ 0.0476 | |||||||||
Option expiration period | 5 years | ||||||||||
Black-Scholes option-pricing model | $ 119,217 | ||||||||||
Sale of stock purchase price per share | $ / shares | 0.0473 | $ 0.0473 | |||||||||
Subsequent Event [Member] | Settlement Agreement [Member] | Options 2 [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 29,098,028 | ||||||||||
Option exercisable per share | $ / shares | 0.0175 | $ 0.0175 | |||||||||
Option expiration period | 5 years | ||||||||||
Black-Scholes option-pricing model | $ 488,847 | ||||||||||
Sale of stock purchase price per share | $ / shares | $ 0.0168 | $ 0.0168 | |||||||||
Subsequent Event [Member] | Vice President and Chief Financial Officer [Member] | Settlement Agreement [Member] | |||||||||||
Settlement in cash | $ 3,000 | ||||||||||
Settlement amount due | $ 15,500 | ||||||||||
Issuance of options to purchase common stock shares | shares | 50,000 | ||||||||||
Option exercisable per share | $ / shares | $ 0.018 | ||||||||||
Option expiration period | 5 years | ||||||||||
Black-Scholes option-pricing model | $ 840 | ||||||||||
Subsequent Event [Member] | Dr. Arnold S. Lippa [Member] | |||||||||||
Cash bonus | $ 75,000 | $ 75,000 | |||||||||
Established cash compensation arrangements | 12,500 | $ 12,500 | |||||||||
Subsequent Event [Member] | Dr. Arnold S. Lippa [Member] | Note Payable to Chairman [Member] | |||||||||||
Notes payable related parties | $ 40,000 | ||||||||||
Percentage of advance due interest | 10.00% | ||||||||||
Accrued interest | $ 164 | ||||||||||
Subsequent Event [Member] | Dr. Arnold S. Lippa [Member] | Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 2,000,000 | ||||||||||
Subsequent Event [Member] | Dr. Arnold S. Lippa [Member] | Consisting of Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 15,000,000 | ||||||||||
Subsequent Event [Member] | Jeff E. Margolis [Member] | |||||||||||
Cash bonus | 60,000 | $ 60,000 | |||||||||
Established cash compensation arrangements | 10,000 | $ 10,000 | |||||||||
Subsequent Event [Member] | Jeff E. Margolis [Member] | Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 2,000,000 | ||||||||||
Subsequent Event [Member] | Jeff E. Margolis [Member] | Consisting of Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 15,000,000 | ||||||||||
Subsequent Event [Member] | Robert N. Weingarten [Member] | |||||||||||
Cash bonus | 60,000 | $ 60,000 | |||||||||
Established cash compensation arrangements | 10,000 | $ 10,000 | |||||||||
Subsequent Event [Member] | Robert N. Weingarten [Member] | Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 2,000,000 | ||||||||||
Subsequent Event [Member] | Robert N. Weingarten [Member] | Consisting of Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 15,000,000 | ||||||||||
Subsequent Event [Member] | Scientific Advisory Board [Member] | Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 2,000,000 | ||||||||||
Subsequent Event [Member] | Board Of Directors [Member] | |||||||||||
Cash bonus | 215,000 | $ 215,000 | |||||||||
Subsequent Event [Member] | Board Of Directors [Member] | Options [Member] | Issuance of Stock Options [Member] | |||||||||||
Issuance of options to purchase common stock shares | shares | 2,000,000 | ||||||||||
Subsequent Event [Member] | Executive Officers [Member] | |||||||||||
Cash bonus | 195,000 | $ 195,000 | |||||||||
Subsequent Event [Member] | Independent Board of Directors [Member] | |||||||||||
Cash bonus | 20,000 | 20,000 | |||||||||
Subsequent Event [Member] | James E. Sapirstein [Member] | |||||||||||
Cash bonus | 10,000 | 10,000 | |||||||||
Established cash compensation arrangements | 10,000 | 10,000 | |||||||||
Subsequent Event [Member] | Kathryn MacFarlane [Member] | |||||||||||
Cash bonus | 10,000 | 10,000 | |||||||||
Established cash compensation arrangements | $ 10,000 | $ 10,000 |