Aethlon Medical (AEMD) S-1 17 Apr 15 IPO registration Financial data

Document_And_Entity_Informatio

Document And Entity Information	9 Months Ended
	Dec. 31, 2014
Term Of Lease
Entity Registrant Name	Aethlon Medical Inc
Entity Central Index Key	882291
Document Type	S-1
Document Period End Date	31-Dec-14
Amendment Flag	TRUE
Amendment Description	This amendment is being filed to comply with regulations.
Current Fiscal Year End Date	-28
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company

BALANCE_SHEETS

BALANCE SHEETS (USD $)	Dec. 31, 2014	Mar. 31, 2014	Mar. 31, 2013
Current assets
Cash	$2,775,735	$1,250,279	$125,274
Accounts receivable	15,226	95,177	208,781
Deferred financing costs	131,489	83,191	863
Prepaid expenses and other current assets	46,754	50,699	29,602
Total current assets	2,969,204	1,479,346	364,520
Property and equipment, net	63,138	84,279	145
Patents and patents pending, net	105,616	112,489	121,653
Deposits	18,537	18,988	10,376
Total assets	3,156,495	1,695,102	496,694
Current liabilities
Accounts payable	324,337	517,651	822,832
Accrued expenses	440,419	1,855,374	1,804,985
Due to related parties	810,381	839,070	736,070
Notes payable	22,500	390,000	321,381
Convertible notes payable, current portion	0	1,367,655	2,367,631
Derivative liabilities	0	10,679,067	3,588,239
Total current liabilities	1,597,637	15,648,817	9,641,138
Noncurrent liabilities
Convertible notes payable, noncurrent portion	264,252	776,451	0
Total noncurrent liabilities	264,252	776,451	0
Total liabilities	1,861,889	16,425,268	9,641,138
Commitments and Contingencies (Note 13)
Stockholders' Deficit
Common stock	6,552	4,497	3,473
Additional paid-in capital	81,953,468	59,879,624	52,327,408
Accumulated deficit	-80,743,001	-74,832,557	-61,475,325
Total Aethlon Medical, Inc. stockholders' equity (deficit) before noncontrolling interests	1,217,019	-14,948,436	-9,144,444
Noncontrolling interests	77,587	218,270	0
Total equity (deficit)	1,294,606	-14,730,166	-9,144,444
Total liabilities and deficit	$3,156,495	$1,695,102	$496,694

BALANCE_SHEETS_Parenthetical

BALANCE SHEETS (Parenthetical) (USD $)	Dec. 31, 2014	Mar. 31, 2014	Mar. 31, 2013
Stockholders' Deficit
Common stock par value (in Dollars per share)	$0.00	$0.00	$0.00
Common stock shares authorized	10,000,000	10,000,000	5,000,000
Common stock issued	6,554,784	4,499,480	3,473,484
Common stock outstanding	6,554,784	4,499,480	3,473,484

STATEMENTS_OF_OPERATIONS

STATEMENTS OF OPERATIONS (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
REVENUES
Government contract revenue	$33,434	$76,313	$563,805	$916,796	$1,623,769	$1,230,004
OPERATING EXPENSES
Professional fees	82,029	553,231	792,463	1,204,812	1,521,397	1,892,270
Payroll and related expenses	570,939	425,293	1,735,979	1,288,773	2,227,194	2,166,989
General and administrative	467,446	330,131	895,543	669,145	931,106	746,099
Total operating expenses	1,120,414	1,308,655	3,423,985	3,162,730	4,679,697	4,805,358
OPERATING LOSS	-1,086,980	-1,232,342	-2,860,180	-2,245,934	-3,055,928	-3,575,354
OTHER EXPENSE
Loss on debt conversion	222,939	0	2,754,062	40,256	40,257	139,839
(Gain)/loss on change in fair value of derivative liability	0	-78,175	0	2,304,702	8,547,015	44,705
Loss on litigation settlement	0	0	0	0	583,601	0
Interest and other debt expenses	148,723	113,444	293,522	329,887	1,287,221	1,132,314
Other expense	143,363	1,000,000	143,363	1,000,000	-75,060	-172
Total other expense	515,025	1,035,269	3,190,947	3,674,845	10,383,034	1,316,686
NET LOSS BEFORE NONCONTROLLING INTERESTS	-1,602,005	-2,267,611	-6,051,127	-5,920,779	-13,438,962	-4,892,040
LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS	-51,548	-37,061	-140,683	-37,061	-81,730	0
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS	($1,550,457)	($2,230,550)	($5,910,444)	($5,883,718)	($13,357,232)	($4,892,040)
BASIC AND DILUTED LOSS PER COMMON SHARE	($0.26)	($0.56)	($1.12)	($1.57)	($3.44)	($1.64)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING - BASIC AND DILUTED	6,032,126	3,963,066	5,254,459	3,750,111	3,881,179	2,984,472

CONSOLIDATED_STATEMENTS_OF_SHA

CONSOLIDATED STATEMENTS OF SHAREHOLDER'S DEFICIT (USD $)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Noncontrolling Interest [Member]	Total
Beginning Balance, amount at Mar. 31, 2012	$2,350	$47,285,314	($56,583,285)	$0	($9,295,621)
Beginning Balance, shares at Mar. 31, 2012	2,350,317
Issuance of common stock for cash, shares	594,491
Issuance of common stock for cash, amount	594	2,109,240			2,109,834
Issuances of common stock upon conversions of notes payable, shares	438,823
Issuances of common stock upon conversions of notes payable, amount	439	1,694,620			1,695,059
Issuance of common stock for services, shares	57,924
Issuance of common stock for services, amount	58	258,977			259,035
Patent license fees paid with issuance of common stock, shares	4,929
Patent license fees paid with issuance of common stock, amount	5	17,245			17,250
Reclassification of derivative liability into equity		45,081			45,081
Issuance of common stock for interest, Shares	2,320
Issuance of common stock for interest, Amount	2	11,844			11,846
Loss on debt conversion, shares	24,680
Loss on debt conversion, amount	25	139,814			139,839
Stock-based compensation expense		765,273			765,273
Net loss			-4,892,040		-4,892,040
Ending Balance, amount at Mar. 31, 2013	3,473	52,327,408	-61,475,325	0	-9,144,444
Ending Balance, shares at Mar. 31, 2013	3,473,484
Issuance of common stock for cash, shares	337,455
Issuance of common stock for cash, amount	337	1,676,695			1,677,032
Issuances of common stock upon conversions of notes payable, shares	211,480
Issuances of common stock upon conversions of notes payable, amount	211	726,565			726,776
Issuance of common stock under cashless warrant exercises, shares	254,325
Issuance of common stock under cashless warrant exercises, amount	254	-254
Issuance of common stock for services, shares	61,423
Issuance of common stock for services, amount	61	392,032			392,093
Reclassification of derivative liability into equity		1,456,187			1,456,187
Issuance of common stock for cash - ESI, Amount		1,200,000		300,000	1,500,000
Issuance of common stock under convertible debt restructuring, Shares	90,142
Issuance of common stock under convertible debt restructuring, Amount	90	856,259			856,349
Issuance of common stock under stock option exercises for accrued expenses, Shares	3,171
Issuance of common stock under stock option exercises for accrued expenses, Amount	3	12,997			13,000
Shares issued under restricted stock grant, Shares	68,000
Shares issued under restricted stock grant, Amount	68	-68
Issuance of common stock on litigation settlement, Amount		583,601			583,601
Loss on debt conversion, amount		40,256			40,256
Stock-based compensation expense		607,946			607,946
Net loss			-13,357,232	-81,730	-13,438,962
Ending Balance, amount at Mar. 31, 2014	$4,497	$59,879,624	($74,832,557)	$218,270	($14,730,166)
Ending Balance, shares at Mar. 31, 2014	4,499,480

STATEMENTS_OF_CASH_FLOWS

STATEMENTS OF CASH FLOWS (USD $)	9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Cash flows from operating activities:
Net loss	($6,051,127)	($5,920,779)	($13,438,962)	($4,892,040)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	28,014	14,159	21,087	10,484
Debt restructuring cost	0	0	856,349	139,839
Non-cash interest expense	0	0	0	11,846
Loss on litigation settlement	0	0	583,601	0
Stock based compensation	338,580	223,351	607,946	765,273
Fair market value of common stock, warrants and options issued for services	225,158	264,343	392,093	259,035
Change in fair value of derivative liabilities	0	2,304,702	8,547,015	44,705
Loss on extension of warrants	143,363	0	0	0
Loss on debt conversion	2,754,062	40,256	40,256	0
Patent license fees paid with issuance of common stock	0	0	0	17,250
Amortization of debt discount and deferred financing costs	131,074	5,147	5,147	594,358
Changes in operating assets and liabilities:
Accounts receivable	79,951	163,772	113,604	191,333
Prepaid expenses and other current assets	4,396	4,052	-21,097	1,850
Other assets			-8,612	0
Accounts payable and other current liabilities	-776,559	1,268,625	46,602	751,210
Due to related parties	-28,689	48,500	116,000	6,000
Net cash used in operating activities	-3,151,777	-1,583,872	-2,138,971	-2,098,857
Cash flows from investing activities:
Purchases of property and equipment	0	-61,493	-96,056	0
Net cash used in investing activities	0	-61,493	-96,056	0
Cash flows from financing activities:
Proceeds from the issuance of notes payable	415,000	400,000	400,000	0
Principal repayments of notes payable	-500,920	-200,000	-217,000	-29,610
Net proceeds from the issuance of common stock	4,763,153	3,175,032	3,177,032	2,109,834
Net cash provided by financing activities	4,677,233	3,375,032	3,360,032	2,080,224
Net increase (decrease) in cash	1,525,456	1,729,667	1,125,005	-18,633
Cash at beginning of period	1,250,279	125,274	125,274	143,907
Cash at end of period	2,775,735	1,854,941	1,250,279	125,274
Supplemental disclosures of cash flow information:
Interest	435,139	13,950	13,950	2,821
Income taxes	0	0	0	0
Supplemental disclosures of non-cash investing and financing activities:
Debt and accrued interest converted to common stock	2,065,787	500,460	726,776	1,695,059
Reclassification of warrant derivative liability into equity	10,679,067	316,876	1,456,187	45,081
Reclassification of accounts payable to convertible notes payable	0	47,000	47,000	0
Deferred financing costs recorded	117,280	0	0	0
Reclassification of accrued interest to convertible notes payable	25,766	20,027	20,027	0
Recording deferred financing costs associated with notes payable and convertible notes payable	0	0	83,191	7,500
Debt discount related to warrants and beneficial conversion feature	527,780	0	0	0
Issuance of shares under cashless warrant exercises	21,516	0	12,717	0
Exercise of stock option for accrued expenses	0	0	13,000	0
Reclassification of note payable to convertible notes payable	0	0	0	75,000
Stock issued under restricted stock grant	$0	$0	$3,400	$0

1_ORGANIZATION_AND_SUMMARY_OF_

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

12 Months Ended

Dec. 31, 2014

Mar. 31, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The summary of our significant accounting policies presented below is designed to assist the reader in understanding our condensed consolidated financial statements. Such financial statements and related notes are the representations of our management, who are responsible for their integrity and objectivity. These accounting policies conform to GAAP in all material respects, and have been consistently applied in preparing the accompanying condensed consolidated financial statements.

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

ORGANIZATION

The accompanying condensed consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned and controlled subsidiary, Exosome Sciences, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. The Company classifies the noncontrolling interests in Exosome Sciences, Inc. as part of consolidated net loss in the nine months ended December 31, 2014 and includes the accumulated amount of noncontrolling interests as part of stockholders’ equity. During the fiscal year ended March 31, 2014, Exosome Sciences, Inc. raised capital in the amount of $1,500,000 in exchange for the issuance of 300,000 shares of Exosome Sciences, Inc. common stock to Exosome Sciences, Inc.’s investors, representing 20% of Exosome Sciences, Inc.’s issued and outstanding capital stock. As a result, Aethlon Medical, Inc.’s ownership of Exosome Sciences, Inc. was reduced to 80%. If a further change in Aethlon Medical Inc.’s ownership of Exosome Sciences, Inc. results in loss of control and deconsolidation, any retained ownership interest will be remeasured with the gain or loss reported in our statement of operations.

Aethlon Medical, Inc. and subsidiary ("Aethlon", the "Company", "we" or "us") is a medical device company focused on creating innovative devices that address unmet medical needs in cancer, infectious disease and other life-threatening conditions. At the core of our developments is the Aethlon ADAPT™ (Adaptive Dialysis-Like Affinity Platform Technology) system, a medical device platform that converges single or multiple affinity drug agents with advanced plasma membrane technology to create therapeutic filtration devices that selectively remove harmful particles from the entire circulatory system without loss of essential blood components. On June 25, 2013, the United States Food and Drug Administration (FDA) approved an Investigational Device Exemption (IDE) that allows us to initiate human feasibility studies of the Aethlon Hemopurifier® in the United States. Under the feasibility study protocol, we will enroll ten end-stage renal disease patients who are infected with the Hepatitis C virus (HCV) to demonstrate the safety of Hemopurifier therapy. Successful completion of this study will allow us the opportunity to initiate pivotal studies that are required for market clearance to treat HCV and other disease conditions in the United States.

The losses at Exosome Sciences, Inc. during the nine months ended December 31, 2014 reduced the noncontrolling interests on our consolidated balance sheet by $140,683 from $218,270 at March 31, 2014 to $77,587 at December 31, 2014.

Successful outcomes of human trials will also be required by the regulatory agencies of certain foreign countries where we intend to sell this device. Some of our patents may expire before FDA approval or approval in a foreign country, if any, is obtained. However, we believe that certain patent applications and/or other patents issued more recently will help protect the proprietary nature of the Hemopurifier(R) treatment technology.

USE OF ESTIMATES

In October 2013, our subsidiary, Exosome Sciences, Inc. (“ESI”), commenced operations with a focus on advancing exosome-based strategies to diagnose and monitor the progression of cancer, infectious disease and other life-threatening conditions.

We prepare our condensed consolidated financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets. Actual results could differ from those estimates.

Our common stock is quoted on the OTCQB marketplace administered by the OTC Markets Group under the symbol "AEMD."

CASH AND CASH EQUIVALENTS

REVERSE STOCK SPLIT

Accounting standards define "cash and cash equivalents" as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased, or any investment redeemable without penalty or loss of interest to be cash equivalents. As of December 31, 2014 and March 31, 2014, we had no assets that were classified as cash equivalents.

On April 14, 2015, the Company completed a 1-for-50 reverse stock split. Accordingly, authorized common stock was reduced from 500,000,000 shares to 10,000,000 shares, and each 50 shares of outstanding common stock held by stockholders were combined into one share of common stock. The accompanying consolidated financial statements and accompanying notes have been retroactively revised to reflect such reverse stock split as if it had occurred on April 1, 2012. All shares and per share amounts have been revised accordingly.

CONCENTRATIONS OF CREDIT RISKS

UNAUDITED PRO FORMA BALANCE SHEET INFORMATION

Cash is maintained at two financial institutions in checking accounts and related cash management accounts. Accounts at these institutions are secured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Our December 31, 2014 cash balances were approximately $2,275,000 over such insured amount. We do not believe that the Company is exposed to any significant risk with respect to its cash.

During June and July 2014, we entered into agreements with two existing convertible note holders to convert one note into common stock and to extend the second note and to restructure warrants related to the original note issuances removing certain price protection features from such warrants. The transaction resulted in not only the conversion of debt to equity but also the reclassification of such warrants from derivative liabilities to equity. As further explained in Note 16, e have presented an unaudited March 31, 2014 pro forma balance sheet to reflect such transactions as if they had occurred on March 31, 2014.

All of our accounts receivable at December 31, 2014 and March 31, 2014 and all of our revenue in the nine month periods ended December 31, 2014 and 2013 were directly from the U.S. Department of Defense or from a subcontract under Battelle Memorial Institute, which is a prime contractor with the U.S. Department of Defense, and as such no allowance for uncollectable accounts receivable was deemed necessary at December 31, 2014 or March 31, 2014.

PRINCIPLES OF CONSOLIDATION

FAIR VALUE OF FINANCIAL INSTRUMENTS

The accompanying consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned and controlled subsidiary, ESI. All significant intercompany balances and transactions have been eliminated in consolidation. The Company classifies the noncontrolling interests in ESI as part of consolidated net loss in the fiscal year ended March 31, 2014 and includes the accumulated amount of noncontrolling interests as part of stockholders’ equity. For the fiscal year ended March 31, 2013, ESI was a wholly-owned subsidiary. During the fiscal year ended March 31, 2014, Aethlon Medical, Inc. reduced its ownership percentage to 80% by ESI’s issuance of 300,000 shares of ESI common stock in exchange for cash of $1,500,000.

The carrying amount of our cash, accounts receivable, accounts payable, and other current liabilities approximate their estimated fair values due to the short-term maturities of those financial instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and since the interest rate approximates current market interest rates for similar instruments.

The losses at ESI during the fiscal year ended March 31, 2014 reduced the noncontrolling interests on our consolidated balance sheet by $81,730 from $300,000 to $218,270 at March 31, 2014.

Management has concluded that it is not practical to determine the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated potential costs.

GOING CONCERN

See Note 9 with respect to derivative liabilities.

The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. We have incurred continuing losses from operations and at March 31, 2014 are in default on certain debt agreements, have negative working capital of approximately $14,169,000, and an accumulated deficit of approximately $74,833,000. These factors, among other matters, raise substantial doubt about our ability to continue as a going concern. A significant amount of additional capital will be necessary to advance the development of our products to the point at which they may become commercially viable. We intend to fund operations, working capital and other cash requirements for the fiscal year ending March 31, 2015 through debt and/or equity financing arrangements as well as through revenues and related cash receipts under our government contracts (see Note 11).

PROPERTY AND EQUIPMENT

We are currently addressing our liquidity issue by seeking additional investment capital through private placements of common stock and debt and by applying for additional grants issued by government agencies in the United States. We believe that our cash on hand and funds expected to be received from additional private investment will be sufficient to meet our liquidity needs for fiscal 2015. However, no assurance can be given that we will receive any funds in addition to the funds we have received to date.

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in the consolidated statements of operations.

The successful outcome of future activities cannot be determined at this time and there is no assurance that, if achieved, we will have sufficient funds to execute our intended business plan or generate positive operating results.

INCOME TAXES

Subsequent to March 31, 2014, we completed several significant transactions related to our convertible notes (see Note 16).

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future, it is more likely than not that some portion of the deferred tax assets may not be realized.

The consolidated financial statements do not include any adjustments related to this uncertainty and as to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.

IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS

RISKS AND UNCERTAINTIES

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the cost basis of a long-lived asset is greater than the projected future undiscounted net cash flows from such asset, an impairment loss is recognized. We believe no impairment charges were necessary during the three and nine month periods ended December 31, 2014 and 2013.

We operate in an industry that is subject to intense competition, government regulation and rapid technological change. Our operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory, and including the potential risk of business failure.

LOSS PER COMMON SHARE

USE OF ESTIMATES

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

We prepare our consolidated financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, valuation of derivative liabilities, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets. Actual results could differ from those estimates.

As of December 31, 2014 and 2013, a total of 2,205,525 and 2,902,111 potential common shares, consisting of shares underlying outstanding stock options, warrants and convertible notes payable were excluded as their inclusion would be antidilutive.

CASH AND CASH EQUIVALENTS

SEGMENTS

Accounting standards define "cash and cash equivalents" as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased, or any investment redeemable without penalty or loss of interest to be cash equivalents.  As of March 31, 2014 and 2013, we had no assets that were classified as cash equivalents.

Historically, we operated in one segment that was based on our development of therapeutic devices. However in the December 2013 quarter, we initiated the operations of Exosome Sciences, Inc. to develop diagnostic tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and Exosome Sciences, Inc. for diagnostic applications (See Note 14).

FAIR VALUE OF FINANCIAL INSTRUMENTS

DEFERRED FINANCING COSTS

The carrying amount of our cash, accounts receivable, accounts payable, and other current liabilities approximates their estimated fair values due to the short-term maturities of those financial instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and since the interest rates approximate current market interest rates for similar instruments. Derivative liabilities recorded in connection with warrants and embedded conversion features of certain convertible notes payable are reported at their estimated fair value, with changes in fair value being reported in results of operations (see Note 10).

Costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method.  We recorded amortization expense related to our deferred offering costs of $68,982 and $863 during the nine month periods ended December 31, 2014 and 2013, respectively.

Management has concluded that it is not practical to determine the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated potential costs.

REVENUE RECOGNITION

Other than our derivative liabilities, we do not have any assets or liabilities that are measured at fair value on a recurring basis and, during the years ended March 31, 2014 and 2013, did not have any assets or liabilities that were measured at fair value on a nonrecurring basis except as described in Note 10 under derivative liabilities.

DARPA Contract -- With respect to revenue recognition, we entered into a government contract with DARPA and have recognized revenue under such contract. We adopted the Milestone method of revenue recognition for the DARPA contract under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605-28 “Revenue Recognition – Milestone Method” and we believe we meet the requirements under ASC 605-28 for reporting contract revenue under the Milestone Method.

CONCENTRATIONS OF CREDIT RISKS

In order to account for this contract, we identify the deliverables included within the contract and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

Cash is maintained at two financial institutions in checking accounts and related cash management accounts. Accounts at these institutions are secured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Our March 31, 2014 cash balances were approximately $1,000,000 over such insured amount. We do not believe that the Company is exposed to any significant risk with respect to its cash.

A milestone is an event having all of the following characteristics:

All of our accounts receivable at March 31, 2014 and 2013 and all of our revenue in the fiscal years ended March 31, 2014 and 2013 were directly from the U.S. Department of Defense or from a subcontract under Battelle, which is a prime contractor with the U.S. Department of Defense.

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

PROPERTY AND EQUIPMENT

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in the consolidated statements of operations.

(3) If achieved, the event would result in additional payments being due to the vendor.

INCOME TAXES

A milestone does not include events for which the occurrence is either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty’s performance.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future, it is more likely than not that some portion of the deferred tax assets may not be realized.

The policy for recognizing deliverable consideration contingent upon achievement of a milestone must be applied consistently to similar deliverables.

The assessment of whether a milestone is substantive is performed at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

LONG-LIVED ASSETS

(1) The consideration is commensurate with either: (a) the vendor’s performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the vendor’s performance to achieve the milestone;

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the cost basis of a long-lived asset is greater than the projected future undiscounted net cash flows from such asset, an impairment loss is recognized. We believe no impairment charges were necessary during the fiscal years ended March 31, 2014 and 2013.

(2) The consideration relates solely to past performance; and

LOSS PER SHARE

(3) The consideration is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

A milestone is not considered substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive and non-substantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded or adjusted based on future performance, the related milestone is not considered substantive.

As of March 31, 2014 and 2013, a total of 2,861,492 and 2,854,024 potential common shares, consisting of shares underlying outstanding stock options, warrants and convertible notes payable were excluded as their inclusion would be antidilutive.

See Note 12 for the additional disclosure information required under ASC 605-28.

SEGMENTS

Battelle Memorial Institute Subcontract -- We entered into a subcontract agreement with Battelle Memorial Institute Memorial Institute (“Battelle Memorial Institute”) in March 2013. Battelle Memorial Institute was chosen by DARPA to be the prime contractor on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration project. The Battelle Memorial Institute subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the subcontract during the nine months ended December 31, 2013.

Historically, we operated in one segment that was based on our development of therapeutic devices. However in the December 2013 quarter, we initiated the operations of ESI to develop diagnostic tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and ESI for diagnostic applications (See Note 14).

Our revenue under this contract is a function of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees). Battelle Memorial Institute engages us as needed. Each payment requires approval by the program manager at Battelle Memorial Institute.

DEFERRED FINANCING COSTS

STOCK-BASED COMPENSATION

Costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method.  We recorded amortization expense related to our deferred offering costs of $863 and $127,200 during the fiscal years ended March 31, 2014 and 2013, respectively.

Employee stock options and rights to purchase shares under stock participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive awards granted subsequent to April 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see Note 10).

REVENUE RECOGNITION

The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the nine month periods ended December 31, 2014 and 2013:

DARPA Contract -- With respect to revenue recognition, we entered into a government contract with DARPA and have recognized revenue of $1,466,482 and $1,230,004 under that contract during the fiscal years ended March 31, 2014 and 2013, respectively. We adopted the Milestone method of revenue recognition for the DARPA contract under ASC 605-28 “Revenue Recognition – Milestone Method” and we believe we meet the requirements under ASC 605-28 for reporting contract revenue under the Milestone Method for the fiscal years ended March 31, 2014 and 2013.

Nine Months

Nine Months

In order to account for this contract, we identify the deliverables included within the contract and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

Ended

Ended

December 31,

December 31,

A milestone is an event having all of the following characteristics:

2014

2013

Vesting of stock options

$

338,580

$

156,993

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

Incremental fair value of option modifications

–

1,914

Vesting expense associated with CEO restricted stock grant

–

64,444

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

Total stock-based compensation expense

$

338,580

$

223,351

(3) If achieved, the event would result in additional payments being due to the vendor.

Weighted average number of common shares outstanding – basic and diluted

5,254,459

3,750,111

A milestone is an event having all of the following characteristics:

Basic and diluted loss per common share associated with stock-based compensation expense

$

(0.06

)

$

(0.06

)

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

We account for transactions involving services provided by third parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received (i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of the transactions, we use the following methodology:

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

a) For transactions where goods have already been delivered or services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date of issuance).

(3) If achieved, the event would result in additional payments being due to the vendor.

b) For transactions where the instruments are issued on a fully vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.

A milestone does not include events for which the occurrence is either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty’s performance.

c) For any transactions not meeting the criteria in (a) or (b) above, we re-measure the consideration at each reporting date based on its then current stock value.

The policy for recognizing deliverable consideration contingent upon achievement of a milestone must be applied consistently to similar deliverables.

We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate for all expense amortization after March 31, 2006 is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the nine months ended December 31, 2014 was insignificant.

The assessment of whether a milestone is substantive is performed at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

PATENTS

(1) The consideration is commensurate with either: (a) the vendor’s performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the vendor’s performance to achieve the milestone;

Patents include both foreign and domestic patents. There were several patents pending at December 31, 2014. We capitalize the cost of patents and patents pending, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their estimated economic life, upon issuance of the patent. The unamortized costs of patents and patents pending are subject to our review for impairment under our long-lived asset policy above.

(2) The consideration relates solely to past performance; and

STOCK PURCHASE WARRANTS

(3) The consideration is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

We grant warrants in connection with the issuance of convertible notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection with equity transactions and the warrant fair value is recorded to additional paid-in-capital. Lastly, warrants not meeting equity classification are recorded as derivative instruments.

A milestone is not considered substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive and nonsubstantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded or adjusted based on future performance, the related milestone is not considered substantive.

DERIVATIVE INSTRUMENTS

See Note 11 for the additional disclosure information required under ASC 605-28.

We evaluate free-standing derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

Battelle Subcontract -- We entered into a subcontract agreement with Battelle Memorial Institute (“Battelle”) in March 2013. Battelle was chosen by DARPA to be the prime contractor on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration project. The Battelle subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the subcontract during the three months ended September 30, 2013 and for the fiscal year 2014 recorded revenue of $157,287.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

Our revenue under this contract is a function of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees). Battelle engages us as needed. Each payment requires approval by the program manager at Battelle.

Instruments classified as derivative liabilities are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations in other (income) expense.

STOCK-BASED COMPENSATION

BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE

Employee stock options and rights to purchase shares under stock participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive awards granted subsequent to April 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see Note 6).

The convertible feature of certain notes payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a "Beneficial Conversion Feature" ("BCF"). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.

The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the years ended March 31, 2014 and 2013:

REGISTRATION PAYMENT ARRANGEMENTS

31-Mar-14

31-Mar-13

We account for contingent obligations to make future payments or otherwise transfer consideration under a registration payment arrangement separately from any related financing transaction agreements, and any such contingent obligations are recognized only when it is determined that it is probable we will become obligated for future payments and the amount, or range of amounts, of such future payments can be reasonably estimated.

Vesting of Stock Options

$

541,588

$

355,578

Incremental fair value of option Modifications

1,914

23,028

RESEARCH AND DEVELOPMENT EXPENSES

Vesting Expense Associated with CEO Restricted Stock Grant

64,444

386,667

Total Stock-Based Compensation Expense

$

607,946

$

765,273

We incurred research and development expenses during the three and nine month periods ended December 31, 2014 and 2013, which are included in various operating expense line items in the accompanying condensed consolidated statements of operations. Our research and development expenses in those periods were as follows:

Basic and diluted loss per common share

$

(0.16

)

$

(0.26

)

December 31,

December 31,

2014

2013

We account for transactions involving services provided by third parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received (i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of the transactions, we use the following methodology:

Three months ended

$

214,165

$

542,383

a) For transactions where goods have already been delivered or services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date of issuance).

Nine months ended

$

747,657

$

1,178,488

b) For transactions where the instruments are issued on a fully vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.

OFF-BALANCE SHEET ARRANGEMENTS

c) For any transactions not meeting the criteria in (a) or (b) above, we re-measure the consideration at each reporting date based on its then current stock value.

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial statements.

We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate for all expense amortization after March 31, 2006 is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the fiscal year ended March 31, 2014 was insignificant.

SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS

PATENTS

Management is evaluating significant recent accounting pronouncements that are not yet effective for the Company, including the new accounting standard on revenue recognition, Accounting Standards Update (“ASU”) 2014-09 (Topic 606), and has not yet concluded whether any such pronouncements will have a significant effect on the Company’s future consolidated financial statements.

Patents include both foreign and domestic patents. There were several patents pending at March 31, 2014. We capitalize the cost of patents and patents pending, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their estimated economic life, upon issuance of the patent. The unamortized costs of patents and patents pending are subject to our review for impairment under our long-lived asset policy above.

STOCK PURCHASE WARRANTS

We grant warrants in connection with the issuance of convertible notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection with equity transactions and the warrant fair value is recorded to additional paid-in-capital. Lastly, warrants not meeting equity classification are recorded as derivative instruments.

DERIVATIVE INSTRUMENTS

We evaluate free-standing derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

Instruments classified as derivative liabilities are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations in other (income) expense.

BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE

The convertible feature of certain notes payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a "Beneficial Conversion Feature" ("BCF"). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.

REGISTRATION PAYMENT ARRANGEMENTS

We account for contingent obligations to make future payments or otherwise transfer consideration under a registration payment arrangement separately from any related financing transaction agreements, and any such contingent obligations are recognized only when it is determined that it is probable that the Company will become obligated for future payments and the amount, or range of amounts, of such future payments can be reasonably estimated.

RESEARCH AND DEVELOPMENT EXPENSES

Our research and development costs are expensed as incurred. We incurred approximately $1,509,000 and $1,440,000 of research and development expenses for the years ended March 31, 2014 and 2013, respectively, which are included in various operating expenses in the accompanying consolidated statements of operations.

OFF-BALANCE SHEET ARRANGEMENTS

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial statements.

SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS

Management is evaluating significant recent accounting pronouncements that are not yet effective for the Company, including the new accounting standard on revenue recognition, ASU 2014-09 (Topic 606), and has not yet concluded whether any such pronouncements will have a significant effect on the Company’s future consolidated financial statements.

1_NATURE_OF_BUSINESS_AND_BASIS

1. NATURE OF BUSINESS AND BASIS OF PRESENTATION	9 Months Ended
	Dec. 31, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF BUSINESS AND BASIS OF PRESENTATION	ORGANIZATION
	Aethlon Medical, Inc. and subsidiary ("Aethlon", the "Company", "we" or "us") is a medical device company focused on creating innovative devices that address unmet medical needs in cancer, infectious disease and other life-threatening conditions. At the core of our developments is the Aethlon ADAPT™ (Adaptive Dialysis-Like Affinity Platform Technology) system, a medical device platform that converges single or multiple affinity drug agents with advanced plasma membrane technology to create therapeutic filtration devices that selectively remove harmful particles from the entire circulatory system without loss of essential blood components. On June 25, 2013, the United States Food and Drug Administration (FDA) approved an Investigational Device Exemption (IDE) that allows us to initiate human feasibility studies of the Aethlon Hemopurifier® in the United States. Under the feasibility study protocol, we will enroll ten end-stage renal disease patients who are infected with the Hepatitis C virus (HCV) to demonstrate the safety of Hemopurifier therapy. Successful completion of this study will allow us the opportunity to initiate pivotal studies that are required for market clearance to treat HCV and other disease conditions in the United States.
	Successful outcomes of human trials will also be required by the regulatory agencies of certain foreign countries where we intend to sell this device. Some of our patents may expire before FDA approval or approval in a foreign country, if any, is obtained. However, we believe that certain patent applications and/or other patents issued more recently will help protect the proprietary nature of the Hemopurifier(R) treatment technology.
	In October 2013, our subsidiary, Exosome Sciences, Inc., commenced operations with a focus on advancing exosome-based strategies to diagnose and monitor the progression of cancer, infectious disease and other life-threatening conditions.
	Our common stock is quoted on the OTCQB marketplace administered by the OTC Markets Group under the symbol "AEMD."
	The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and applicable sections of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments necessary to make the financial statements not misleading have been included. The condensed consolidated balance sheet as of March 31, 2014 was derived from our audited consolidated financial statements. Operating results for the nine months ended December 31, 2014 are not necessarily indicative of the results that may be expected for the year ending March 31, 2015. For further information, refer to our Annual Report on Form 10-K for the year ended March 31, 2014, which includes audited consolidated financial statements and footnotes as of March 31, 2014 and 2013 and for the years then ended.
	REVERSE STOCK SPLIT
	On April 14, 2015, we completed a 1-for-50 reverse stock split. Accordingly, authorized common stock was reduced from 500,000,000 shares to 10,000,000 shares, and each 50 shares of outstanding common stock held by stockholders was combined into one share of common stock.
	The accompanying condensed consolidated financial statements and accompanying notes have been retroactively revised to reflect such reverse stock split as if it had occurred on April 1, 2013. All shares and per share amounts have been revised accordingly.

2_LIQUIDITY

2. LIQUIDITY	9 Months Ended
	Dec. 31, 2014
Risks and Uncertainties [Abstract]
LIQUIDITY	The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. We have incurred continuing losses from operations and have an accumulated deficit of approximately $80,743,000. These factors, among other matters, raise substantial doubt about our ability to continue as a going concern. A significant amount of additional capital will be necessary to advance the development of our products to the point at which they may become commercially viable. We intend to fund operations, working capital and other cash requirements for the fiscal year ending March 31, 2015 through debt and/or equity financing arrangements as well as through revenues and related cash receipts under our government contracts (see Note 12).
	During the nine months ended December 31, 2014, we converted a past due convertible note in the amount of $660,000 and related accrued interest into equity and also restructured and extended a formerly past due convertible note in the amount of $225,000 (that note was subsequently converted into equity – see Note 5). We also eliminated the antidilution price protection on all the remaining notes and warrants which held such price protection. The combination of all of those actions allowed us to reclassify our derivative liability in the amount of $10,679,067 into equity during the quarter ended June 2014.
	In addition, during the nine months ended December 31, 2014, we raised approximately $4,763,000 through the issuance of common stock to investors and approximately $415,000 through the issuance of convertible notes.
	We are currently addressing our liquidity issue by seeking additional investment capital through private placements of common stock and debt and by applying for additional grants issued by government agencies in the United States. We believe that our cash on hand and funds expected to be received from additional private investments will be sufficient to meet our liquidity needs for fiscal 2015. However, no assurance can be given that we will receive any funds in the form of revenues or in connection with capital raising activities in addition to the funds we have already received.
	The successful outcome of future contract-based and fundraising activities cannot be determined at this time and there is no assurance that, even if achieved, we will have sufficient funds to execute our intended business plan or generate positive operating results.
	The consolidated financial statements do not include any adjustments related to this uncertainty and as to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.

3_SUMMARY_OF_SIGNIFICANT_ACCOU

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

12 Months Ended

Dec. 31, 2014

Mar. 31, 2014

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The summary of our significant accounting policies presented below is designed to assist the reader in understanding our condensed consolidated financial statements. Such financial statements and related notes are the representations of our management, who are responsible for their integrity and objectivity. These accounting policies conform to GAAP in all material respects, and have been consistently applied in preparing the accompanying condensed consolidated financial statements.

1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION

ORGANIZATION

The accompanying condensed consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned and controlled subsidiary, Exosome Sciences, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. The Company classifies the noncontrolling interests in Exosome Sciences, Inc. as part of consolidated net loss in the nine months ended December 31, 2014 and includes the accumulated amount of noncontrolling interests as part of stockholders’ equity. During the fiscal year ended March 31, 2014, Exosome Sciences, Inc. raised capital in the amount of $1,500,000 in exchange for the issuance of 300,000 shares of Exosome Sciences, Inc. common stock to Exosome Sciences, Inc.’s investors, representing 20% of Exosome Sciences, Inc.’s issued and outstanding capital stock. As a result, Aethlon Medical, Inc.’s ownership of Exosome Sciences, Inc. was reduced to 80%. If a further change in Aethlon Medical Inc.’s ownership of Exosome Sciences, Inc. results in loss of control and deconsolidation, any retained ownership interest will be remeasured with the gain or loss reported in our statement of operations.

Aethlon Medical, Inc. and subsidiary ("Aethlon", the "Company", "we" or "us") is a medical device company focused on creating innovative devices that address unmet medical needs in cancer, infectious disease and other life-threatening conditions. At the core of our developments is the Aethlon ADAPT™ (Adaptive Dialysis-Like Affinity Platform Technology) system, a medical device platform that converges single or multiple affinity drug agents with advanced plasma membrane technology to create therapeutic filtration devices that selectively remove harmful particles from the entire circulatory system without loss of essential blood components. On June 25, 2013, the United States Food and Drug Administration (FDA) approved an Investigational Device Exemption (IDE) that allows us to initiate human feasibility studies of the Aethlon Hemopurifier® in the United States. Under the feasibility study protocol, we will enroll ten end-stage renal disease patients who are infected with the Hepatitis C virus (HCV) to demonstrate the safety of Hemopurifier therapy. Successful completion of this study will allow us the opportunity to initiate pivotal studies that are required for market clearance to treat HCV and other disease conditions in the United States.

The losses at Exosome Sciences, Inc. during the nine months ended December 31, 2014 reduced the noncontrolling interests on our consolidated balance sheet by $140,683 from $218,270 at March 31, 2014 to $77,587 at December 31, 2014.

Successful outcomes of human trials will also be required by the regulatory agencies of certain foreign countries where we intend to sell this device. Some of our patents may expire before FDA approval or approval in a foreign country, if any, is obtained. However, we believe that certain patent applications and/or other patents issued more recently will help protect the proprietary nature of the Hemopurifier(R) treatment technology.

USE OF ESTIMATES

In October 2013, our subsidiary, Exosome Sciences, Inc. (“ESI”), commenced operations with a focus on advancing exosome-based strategies to diagnose and monitor the progression of cancer, infectious disease and other life-threatening conditions.

We prepare our condensed consolidated financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets. Actual results could differ from those estimates.

Our common stock is quoted on the OTCQB marketplace administered by the OTC Markets Group under the symbol "AEMD."

CASH AND CASH EQUIVALENTS

REVERSE STOCK SPLIT

Accounting standards define "cash and cash equivalents" as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased, or any investment redeemable without penalty or loss of interest to be cash equivalents. As of December 31, 2014 and March 31, 2014, we had no assets that were classified as cash equivalents.

On April 14, 2015, the Company completed a 1-for-50 reverse stock split. Accordingly, authorized common stock was reduced from 500,000,000 shares to 10,000,000 shares, and each 50 shares of outstanding common stock held by stockholders were combined into one share of common stock. The accompanying consolidated financial statements and accompanying notes have been retroactively revised to reflect such reverse stock split as if it had occurred on April 1, 2012. All shares and per share amounts have been revised accordingly.

CONCENTRATIONS OF CREDIT RISKS

UNAUDITED PRO FORMA BALANCE SHEET INFORMATION

Cash is maintained at two financial institutions in checking accounts and related cash management accounts. Accounts at these institutions are secured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Our December 31, 2014 cash balances were approximately $2,275,000 over such insured amount. We do not believe that the Company is exposed to any significant risk with respect to its cash.

During June and July 2014, we entered into agreements with two existing convertible note holders to convert one note into common stock and to extend the second note and to restructure warrants related to the original note issuances removing certain price protection features from such warrants. The transaction resulted in not only the conversion of debt to equity but also the reclassification of such warrants from derivative liabilities to equity. As further explained in Note 16, e have presented an unaudited March 31, 2014 pro forma balance sheet to reflect such transactions as if they had occurred on March 31, 2014.

All of our accounts receivable at December 31, 2014 and March 31, 2014 and all of our revenue in the nine month periods ended December 31, 2014 and 2013 were directly from the U.S. Department of Defense or from a subcontract under Battelle Memorial Institute, which is a prime contractor with the U.S. Department of Defense, and as such no allowance for uncollectable accounts receivable was deemed necessary at December 31, 2014 or March 31, 2014.

PRINCIPLES OF CONSOLIDATION

FAIR VALUE OF FINANCIAL INSTRUMENTS

The accompanying consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned and controlled subsidiary, ESI. All significant intercompany balances and transactions have been eliminated in consolidation. The Company classifies the noncontrolling interests in ESI as part of consolidated net loss in the fiscal year ended March 31, 2014 and includes the accumulated amount of noncontrolling interests as part of stockholders’ equity. For the fiscal year ended March 31, 2013, ESI was a wholly-owned subsidiary. During the fiscal year ended March 31, 2014, Aethlon Medical, Inc. reduced its ownership percentage to 80% by ESI’s issuance of 300,000 shares of ESI common stock in exchange for cash of $1,500,000.

The carrying amount of our cash, accounts receivable, accounts payable, and other current liabilities approximate their estimated fair values due to the short-term maturities of those financial instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and since the interest rate approximates current market interest rates for similar instruments.

The losses at ESI during the fiscal year ended March 31, 2014 reduced the noncontrolling interests on our consolidated balance sheet by $81,730 from $300,000 to $218,270 at March 31, 2014.

Management has concluded that it is not practical to determine the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated potential costs.

GOING CONCERN

See Note 9 with respect to derivative liabilities.

The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. We have incurred continuing losses from operations and at March 31, 2014 are in default on certain debt agreements, have negative working capital of approximately $14,169,000, and an accumulated deficit of approximately $74,833,000. These factors, among other matters, raise substantial doubt about our ability to continue as a going concern. A significant amount of additional capital will be necessary to advance the development of our products to the point at which they may become commercially viable. We intend to fund operations, working capital and other cash requirements for the fiscal year ending March 31, 2015 through debt and/or equity financing arrangements as well as through revenues and related cash receipts under our government contracts (see Note 11).

PROPERTY AND EQUIPMENT

We are currently addressing our liquidity issue by seeking additional investment capital through private placements of common stock and debt and by applying for additional grants issued by government agencies in the United States. We believe that our cash on hand and funds expected to be received from additional private investment will be sufficient to meet our liquidity needs for fiscal 2015. However, no assurance can be given that we will receive any funds in addition to the funds we have received to date.

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in the consolidated statements of operations.

The successful outcome of future activities cannot be determined at this time and there is no assurance that, if achieved, we will have sufficient funds to execute our intended business plan or generate positive operating results.

INCOME TAXES

Subsequent to March 31, 2014, we completed several significant transactions related to our convertible notes (see Note 16).

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future, it is more likely than not that some portion of the deferred tax assets may not be realized.

The consolidated financial statements do not include any adjustments related to this uncertainty and as to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.

IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS

RISKS AND UNCERTAINTIES

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the cost basis of a long-lived asset is greater than the projected future undiscounted net cash flows from such asset, an impairment loss is recognized. We believe no impairment charges were necessary during the three and nine month periods ended December 31, 2014 and 2013.

We operate in an industry that is subject to intense competition, government regulation and rapid technological change. Our operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory, and including the potential risk of business failure.

LOSS PER COMMON SHARE

USE OF ESTIMATES

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

We prepare our consolidated financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, valuation of derivative liabilities, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets. Actual results could differ from those estimates.

As of December 31, 2014 and 2013, a total of 2,205,525 and 2,902,111 potential common shares, consisting of shares underlying outstanding stock options, warrants and convertible notes payable were excluded as their inclusion would be antidilutive.

CASH AND CASH EQUIVALENTS

SEGMENTS

Accounting standards define "cash and cash equivalents" as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased, or any investment redeemable without penalty or loss of interest to be cash equivalents.  As of March 31, 2014 and 2013, we had no assets that were classified as cash equivalents.

Historically, we operated in one segment that was based on our development of therapeutic devices. However in the December 2013 quarter, we initiated the operations of Exosome Sciences, Inc. to develop diagnostic tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and Exosome Sciences, Inc. for diagnostic applications (See Note 14).

FAIR VALUE OF FINANCIAL INSTRUMENTS

DEFERRED FINANCING COSTS

The carrying amount of our cash, accounts receivable, accounts payable, and other current liabilities approximates their estimated fair values due to the short-term maturities of those financial instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and since the interest rates approximate current market interest rates for similar instruments. Derivative liabilities recorded in connection with warrants and embedded conversion features of certain convertible notes payable are reported at their estimated fair value, with changes in fair value being reported in results of operations (see Note 10).

Costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method.  We recorded amortization expense related to our deferred offering costs of $68,982 and $863 during the nine month periods ended December 31, 2014 and 2013, respectively.

Management has concluded that it is not practical to determine the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated potential costs.

REVENUE RECOGNITION

Other than our derivative liabilities, we do not have any assets or liabilities that are measured at fair value on a recurring basis and, during the years ended March 31, 2014 and 2013, did not have any assets or liabilities that were measured at fair value on a nonrecurring basis except as described in Note 10 under derivative liabilities.

DARPA Contract -- With respect to revenue recognition, we entered into a government contract with DARPA and have recognized revenue under such contract. We adopted the Milestone method of revenue recognition for the DARPA contract under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605-28 “Revenue Recognition – Milestone Method” and we believe we meet the requirements under ASC 605-28 for reporting contract revenue under the Milestone Method.

CONCENTRATIONS OF CREDIT RISKS

In order to account for this contract, we identify the deliverables included within the contract and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

Cash is maintained at two financial institutions in checking accounts and related cash management accounts. Accounts at these institutions are secured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Our March 31, 2014 cash balances were approximately $1,000,000 over such insured amount. We do not believe that the Company is exposed to any significant risk with respect to its cash.

A milestone is an event having all of the following characteristics:

All of our accounts receivable at March 31, 2014 and 2013 and all of our revenue in the fiscal years ended March 31, 2014 and 2013 were directly from the U.S. Department of Defense or from a subcontract under Battelle, which is a prime contractor with the U.S. Department of Defense.

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

PROPERTY AND EQUIPMENT

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in the consolidated statements of operations.

(3) If achieved, the event would result in additional payments being due to the vendor.

INCOME TAXES

A milestone does not include events for which the occurrence is either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty’s performance.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future, it is more likely than not that some portion of the deferred tax assets may not be realized.

The policy for recognizing deliverable consideration contingent upon achievement of a milestone must be applied consistently to similar deliverables.

The assessment of whether a milestone is substantive is performed at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

LONG-LIVED ASSETS

(1) The consideration is commensurate with either: (a) the vendor’s performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the vendor’s performance to achieve the milestone;

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the cost basis of a long-lived asset is greater than the projected future undiscounted net cash flows from such asset, an impairment loss is recognized. We believe no impairment charges were necessary during the fiscal years ended March 31, 2014 and 2013.

(2) The consideration relates solely to past performance; and

LOSS PER SHARE

(3) The consideration is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

A milestone is not considered substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive and non-substantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded or adjusted based on future performance, the related milestone is not considered substantive.

As of March 31, 2014 and 2013, a total of 2,861,492 and 2,854,024 potential common shares, consisting of shares underlying outstanding stock options, warrants and convertible notes payable were excluded as their inclusion would be antidilutive.

See Note 12 for the additional disclosure information required under ASC 605-28.

SEGMENTS

Battelle Memorial Institute Subcontract -- We entered into a subcontract agreement with Battelle Memorial Institute Memorial Institute (“Battelle Memorial Institute”) in March 2013. Battelle Memorial Institute was chosen by DARPA to be the prime contractor on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration project. The Battelle Memorial Institute subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the subcontract during the nine months ended December 31, 2013.

Historically, we operated in one segment that was based on our development of therapeutic devices. However in the December 2013 quarter, we initiated the operations of ESI to develop diagnostic tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and ESI for diagnostic applications (See Note 14).

Our revenue under this contract is a function of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees). Battelle Memorial Institute engages us as needed. Each payment requires approval by the program manager at Battelle Memorial Institute.

DEFERRED FINANCING COSTS

STOCK-BASED COMPENSATION

Costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method.  We recorded amortization expense related to our deferred offering costs of $863 and $127,200 during the fiscal years ended March 31, 2014 and 2013, respectively.

Employee stock options and rights to purchase shares under stock participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive awards granted subsequent to April 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see Note 10).

REVENUE RECOGNITION

The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the nine month periods ended December 31, 2014 and 2013:

DARPA Contract -- With respect to revenue recognition, we entered into a government contract with DARPA and have recognized revenue of $1,466,482 and $1,230,004 under that contract during the fiscal years ended March 31, 2014 and 2013, respectively. We adopted the Milestone method of revenue recognition for the DARPA contract under ASC 605-28 “Revenue Recognition – Milestone Method” and we believe we meet the requirements under ASC 605-28 for reporting contract revenue under the Milestone Method for the fiscal years ended March 31, 2014 and 2013.

Nine Months

Nine Months

In order to account for this contract, we identify the deliverables included within the contract and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

Ended

Ended

December 31,

December 31,

A milestone is an event having all of the following characteristics:

2014

2013

Vesting of stock options

$

338,580

$

156,993

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

Incremental fair value of option modifications

–

1,914

Vesting expense associated with CEO restricted stock grant

–

64,444

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

Total stock-based compensation expense

$

338,580

$

223,351

(3) If achieved, the event would result in additional payments being due to the vendor.

Weighted average number of common shares outstanding – basic and diluted

5,254,459

3,750,111

A milestone is an event having all of the following characteristics:

Basic and diluted loss per common share associated with stock-based compensation expense

$

(0.06

)

$

(0.06

)

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

We account for transactions involving services provided by third parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received (i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of the transactions, we use the following methodology:

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

a) For transactions where goods have already been delivered or services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date of issuance).

(3) If achieved, the event would result in additional payments being due to the vendor.

b) For transactions where the instruments are issued on a fully vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.

A milestone does not include events for which the occurrence is either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty’s performance.

c) For any transactions not meeting the criteria in (a) or (b) above, we re-measure the consideration at each reporting date based on its then current stock value.

The policy for recognizing deliverable consideration contingent upon achievement of a milestone must be applied consistently to similar deliverables.

We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate for all expense amortization after March 31, 2006 is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the nine months ended December 31, 2014 was insignificant.

The assessment of whether a milestone is substantive is performed at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

PATENTS

(1) The consideration is commensurate with either: (a) the vendor’s performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the vendor’s performance to achieve the milestone;

Patents include both foreign and domestic patents. There were several patents pending at December 31, 2014. We capitalize the cost of patents and patents pending, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their estimated economic life, upon issuance of the patent. The unamortized costs of patents and patents pending are subject to our review for impairment under our long-lived asset policy above.

(2) The consideration relates solely to past performance; and

STOCK PURCHASE WARRANTS

(3) The consideration is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

We grant warrants in connection with the issuance of convertible notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection with equity transactions and the warrant fair value is recorded to additional paid-in-capital. Lastly, warrants not meeting equity classification are recorded as derivative instruments.

A milestone is not considered substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive and nonsubstantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded or adjusted based on future performance, the related milestone is not considered substantive.

DERIVATIVE INSTRUMENTS

See Note 11 for the additional disclosure information required under ASC 605-28.

We evaluate free-standing derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

Battelle Subcontract -- We entered into a subcontract agreement with Battelle Memorial Institute (“Battelle”) in March 2013. Battelle was chosen by DARPA to be the prime contractor on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration project. The Battelle subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the subcontract during the three months ended September 30, 2013 and for the fiscal year 2014 recorded revenue of $157,287.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

Our revenue under this contract is a function of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees). Battelle engages us as needed. Each payment requires approval by the program manager at Battelle.

Instruments classified as derivative liabilities are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations in other (income) expense.

STOCK-BASED COMPENSATION

BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE

Employee stock options and rights to purchase shares under stock participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive awards granted subsequent to April 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see Note 6).

The convertible feature of certain notes payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a "Beneficial Conversion Feature" ("BCF"). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.

The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the years ended March 31, 2014 and 2013:

REGISTRATION PAYMENT ARRANGEMENTS

31-Mar-14

31-Mar-13

We account for contingent obligations to make future payments or otherwise transfer consideration under a registration payment arrangement separately from any related financing transaction agreements, and any such contingent obligations are recognized only when it is determined that it is probable we will become obligated for future payments and the amount, or range of amounts, of such future payments can be reasonably estimated.

Vesting of Stock Options

$

541,588

$

355,578

Incremental fair value of option Modifications

1,914

23,028

RESEARCH AND DEVELOPMENT EXPENSES

Vesting Expense Associated with CEO Restricted Stock Grant

64,444

386,667

Total Stock-Based Compensation Expense

$

607,946

$

765,273

We incurred research and development expenses during the three and nine month periods ended December 31, 2014 and 2013, which are included in various operating expense line items in the accompanying condensed consolidated statements of operations. Our research and development expenses in those periods were as follows:

Basic and diluted loss per common share

$

(0.16

)

$

(0.26

)

December 31,

December 31,

2014

2013

We account for transactions involving services provided by third parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received (i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of the transactions, we use the following methodology:

Three months ended

$

214,165

$

542,383

a) For transactions where goods have already been delivered or services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date of issuance).

Nine months ended

$

747,657

$

1,178,488

b) For transactions where the instruments are issued on a fully vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.

OFF-BALANCE SHEET ARRANGEMENTS

c) For any transactions not meeting the criteria in (a) or (b) above, we re-measure the consideration at each reporting date based on its then current stock value.

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial statements.

We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate for all expense amortization after March 31, 2006 is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the fiscal year ended March 31, 2014 was insignificant.

SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS

PATENTS

Management is evaluating significant recent accounting pronouncements that are not yet effective for the Company, including the new accounting standard on revenue recognition, Accounting Standards Update (“ASU”) 2014-09 (Topic 606), and has not yet concluded whether any such pronouncements will have a significant effect on the Company’s future consolidated financial statements.

Patents include both foreign and domestic patents. There were several patents pending at March 31, 2014. We capitalize the cost of patents and patents pending, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their estimated economic life, upon issuance of the patent. The unamortized costs of patents and patents pending are subject to our review for impairment under our long-lived asset policy above.

STOCK PURCHASE WARRANTS

We grant warrants in connection with the issuance of convertible notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection with equity transactions and the warrant fair value is recorded to additional paid-in-capital. Lastly, warrants not meeting equity classification are recorded as derivative instruments.

DERIVATIVE INSTRUMENTS

We evaluate free-standing derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

Instruments classified as derivative liabilities are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations in other (income) expense.

BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE

The convertible feature of certain notes payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a "Beneficial Conversion Feature" ("BCF"). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.

REGISTRATION PAYMENT ARRANGEMENTS

We account for contingent obligations to make future payments or otherwise transfer consideration under a registration payment arrangement separately from any related financing transaction agreements, and any such contingent obligations are recognized only when it is determined that it is probable that the Company will become obligated for future payments and the amount, or range of amounts, of such future payments can be reasonably estimated.

RESEARCH AND DEVELOPMENT EXPENSES

Our research and development costs are expensed as incurred. We incurred approximately $1,509,000 and $1,440,000 of research and development expenses for the years ended March 31, 2014 and 2013, respectively, which are included in various operating expenses in the accompanying consolidated statements of operations.

OFF-BALANCE SHEET ARRANGEMENTS

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial statements.

SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS

Management is evaluating significant recent accounting pronouncements that are not yet effective for the Company, including the new accounting standard on revenue recognition, ASU 2014-09 (Topic 606), and has not yet concluded whether any such pronouncements will have a significant effect on the Company’s future consolidated financial statements.

4_NOTES_PAYABLE

4. NOTES PAYABLE	9 Months Ended									12 Months Ended
	Dec. 31, 2014									Mar. 31, 2014
Debt Disclosure [Abstract]
NOTES PAYABLE	Notes payable consist of the following:									4. NOTES PAYABLE
		31-Dec-14				31-Mar-14				Notes payable consist of the following:
		Principal Balance		Accrued Interest		Principal Balance		Accrued Interest
	12% Notes payable	$	22,500	$	45,562	$	185,000	$	353,813		31-Mar-14					31-Mar-13
	10% Note payable		–		–		5,000		6,375		Principal Balance			Accrued Interest		Principal Balance		Accrued Interest
	Directors’ Note(s)		–		–		200,000		14,516	12% Notes payable, past due	$	185,000		$	353,813	$	185,000	$	326,062
	Total	$	22,500	$	45,562	$	390,000	$	374,704	10% Note payable, past due		5,000			6,375		5,000		5,875
	During the nine months ended December 31, 2014, we recorded interest expense of $27,021 related to the contractual interest rates of our notes payable, which is included in interest and other debt expenses on our condensed consolidated statements of operations. Accrued interest is included in other current liabilities on our condensed consolidated balance sheets (see Note 8).									Directors’ Note(s)		200,000			14,516		–		–
										Tonaquint Note		–			–		131,381		1,629
	12% NOTES									Total	$	390,000		$	374,704	$	321,381	$	333,566
	From August 1999 through May 2005, we entered into various borrowing arrangements for the issuance of notes payable from private placement offerings (the "12% Notes"). In December 2014, we paid off in full six of the remaining eight 12% Notes with payments of $453,750, representing $150,000 in principal and $303,750 of accrued interest.									During the fiscal year ended March 31, 2014, we recorded interest expense of $59,901 related to the contractual interest rates of our notes payable.
	In December 2014, at the request of another note holder, we paid one-half of the $25,000 principal on his note and one-half of the $50,625 in accrued interest on his note for a total payment in December 2014 of $37,813. As part of that arrangement, the holder agreed that his note was no longer in default. In January 2015, we paid off the remaining one-half of that note in the amount of $37,813 (see Note 15).									12% NOTES
	In January 2015, we paid off the last remaining 12% Note with a payment of $30,250, representing $10,000 in principal and $20,250 of accrued interest (see Note 15).									From August 1999 through May 2005, we entered into various borrowing arrangements for the issuance of notes payable from private placement offerings (the "12% Notes"). On April 21, 2010, a holder of $100,000 of the 12% Notes converted his principal balance and $71,758 of accrued interest into 13,741 shares of common stock at an agreed conversion price of $12.50 per share. At March 31, 2014, the 12% Notes were past due, in default, and bearing interest at the default rate of 15%.
	10% NOTES									10% NOTES
	In December 2014, we paid off the remaining 10% Note with a payment of $11,750 representing principal of $5,000 and accrued interest of $6,750.									At March 31, 2014, one 10% Note in the amount of $5,000, which is past due and in default, remained outstanding and it bears interest at the default rate of 15%.
	DIRECTORS’ NOTES									Management's plans to satisfy the remaining outstanding balance on these 12% and 10% Notes include converting the notes to common stock at market value or repayment with available funds.
	In July 2013, we borrowed $400,000 from two of our directors under two 90 day notes for $200,000 each bearing 10% interest (the “Notes”). At the discretion of the holders, if not paid off by October 9, 2013, the noteholders were entitled to (i) convert the principal and accrued interest under the Notes into shares of common stock at $4.40 per share (the “Conversion Price”) and (ii) receive warrants to purchase common stock equal to 50% of the principal converted under the Notes, with an exercise price of $6.60 per share. Additionally, there was a provision for a penalty interest rate of 12%.									TONAQUINT NOTE
	That potential conversion price and warrant exercise price were based on the same pricing mechanism that we have used in prior equity unit financings since March 2012 (see Note 6) which are based on 80% of the then current market price of our common stock and with the warrant exercise price based on 120% of the same then current market price. We initially reserved 138,636 shares of common stock to support the conversion of the Notes and accrued interest in full as well as the exercise of the warrants in full (should such conversion and/or issuance occur).									On June 28, 2011, in conjunction with our satisfying all balances owed under a convertible note, we entered into a Termination Agreement with Tonaquint, Inc. under which both parties agreed that in consideration of the termination of a warrant, the waiving of all fees, penalties, the creation of the selling program and other factors, we agreed to issue an unsecured non-convertible promissory note (the "New Note") in the principal amount of $360,186, which provides for annual interest at a rate of 6%, payable monthly in either cash or our stock, at our option. The New Note originally had a maturity date of April 30, 2012. We subsequently extended the note initially to July 31, 2012 and then to July 31, 2013 and subsequently to August 31, 2013. We also recorded into principal $12,500 of the lender’s legal fees related to documentation of the extension agreement.
	During the fiscal year ended March 31, 2014, the principal of $200,000 and accrued interest of $9,367 were paid on one of the Notes, which extinguished all potential common stock and warrant issuance provisions related to that Note.									During the fiscal year ended March 31, 2014, we issued 30,809 shares of common stock to convert $136,060 of principal and accrued interest (see Note 6). As a result of those conversions, the Tonaquint Note was paid off in full during the September 2013 quarter. We recorded a loss on conversion of $40,256 on those conversions during the fiscal year ended March 31, 2014.
	During the nine months ended December 31, 2014, the holder of the second Note converted the principal of $200,000 and accrued interest of $20,349 into 50,079 shares of our common stock per the conversion formula of the Note (see Note 6).									The following table shows the conversions into principal of the Tonaquint Note by fiscal year:
										Initial principal balance	$	360,186
										Lender’s legal fees		12,500
										Conversions during the fiscal year ended March 31, 2013		(241,305	)
										Conversions during the fiscal year ended March 31, 2014		(131,381	)
										Balance as of March 31, 2014	$	–
										DIRECTORS’ NOTES
										In July 2013, we borrowed $400,000 from two of our directors under two 90 day notes for $200,000 each bearing 10% interest (the “Notes”). At the discretion of the holders, if not paid off by October 9, 2013, the noteholders were entitled to (i) convert their principal and accrued interest into shares of common stock at $4.40 per share (the “Conversion Price”) and (ii) receive warrants to purchase common stock equal to 50% of the principal converted under the Notes, with an exercise price of $6.60 per share. Additionally, there was a provision for a penalty interest rate of 12%.
										That potential conversion price and warrant exercise price were based on the same pricing mechanism that we have used in prior equity unit financings since March 2012 (see Note 6) which are based on 80% of the then current market price of our common stock and with the warrant exercise price based on 120% of the same then current market price. We initially reserved 138,636 shares of common stock to support the conversion of the Notes and accrued interest in full as well as the exercise of the warrants in full (should such conversion and/or issuance occur).
										During the fiscal year ended March 31, 2014, the principal of $200,000 and accrued interest of $9,367 were paid on one of the notes, which extinguished all potential common stock and warrant issuance provisions related to that Note.
										The holder of the second Note agreed to extend the expiration date of his Note to July 31, 2014.

5_CONVERTIBLE_NOTES_PAYABLE

5. CONVERTIBLE NOTES PAYABLE	9 Months Ended											12 Months Ended
	Dec. 31, 2014											Mar. 31, 2014
Convertible Notes Payable [Abstract]
CONVERTIBLE NOTES PAYABLE	Convertible Notes Payable consisted of the following at December 31, 2014:											5. CONVERTIBLE NOTES PAYABLE
		Principal			Unamortized			Net		Accrued		Convertible Notes Payable consisted of the following at March 31, 2014:
					Discount			Amount		Interest
	Convertible Notes Payable – Non-Current Portion:												Principal			Unamortized			Net		Accrued
	November 2014 10% Convertible Notes		527,780			(465,687	)		62,093		2,680					Discount			Amount		Interest
	April 2011 12% Convertible Notes		202,159			–			202,159		8,064	Convertible Notes Payable – Current Portion:
	Total – Convertible Notes Payable – Non-Current Portion		729,939			(465,687	)		264,252		10,744	Amended and Restated Series A 12% Convertible Notes, past due	$	885,000		$	–		$	885,000	$	575,250
	Total Convertible Notes Payable	$	729,939		$	(465,687	)	$	264,252	$	10,744	2008 10% Convertible Notes, past due		25,000			–			25,000		19,167
												October & November 2009 10% Convertible Notes		50,000			–			50,000		26,097
	During the nine months ended December 30, 2014, we recorded interest expense of $123,305 related to the contractual interest rates of our convertible notes, interest expense of $68,982 related to the amortization of deferred financing costs related to the convertible notes and interest expense of $62,092 related to the amortization of note discounts for a total interest related to convertible notes of $254,379.											April 2010 10% Convertible Note		75,000			–			75,000		31,438
												July and August 2011 10% Convertible Notes, past due		257,655			–			257,655		90,256
	Convertible Notes Payable consisted of the following at March 31, 2014:											Law Firm Note		75,000			–			75,000		7,604
												Total – Convertible Notes Payable – Current Portion		1,367,655			–			1,367,655		749,812
		Principal			Unamortized			Net		Accrued
					Discount			Amount		Interest		Convertible Notes Payable – Non-Current Portion:
	Convertible Notes Payable – Current Portion:											September 2010 12% Convertible Notes		317,072			–			317,072		35,034
	Amended and Restated Series A 12% Convertible Notes, past due	$	885,000		$	–		$	885,000	$	575,250	April 2011 12% Convertible Notes		448,448			–			448,448		12,117
	2008 10% Convertible Notes, past due		25,000			–			25,000		19,167	September 2011 12% Convertible Notes		10,931			–			10,931		–
	October & November 2009 10% Convertible Notes		50,000			–			50,000		26,097	Total – Convertible Notes Payable – Non-Current Portion		776,451			–			776,451		47,151
	April 2010 10% Convertible Note		75,000			–			75,000		31,438	Total Convertible Notes Payable	$	2,144,106		$	–		$	2,144,106	$	796,963
	July and August 2011 10% Convertible Notes, past due		257,655			–			257,655		90,256
	Law Firm Note		75,000			–			75,000		7,604	There were no discounts remaining on any of our Convertible Notes Payable as of March 31, 2014.
	Total – Convertible Notes Payable – Current Portion		1,367,655			–			1,367,655		749,812
												During the fiscal year ended March 31, 2014, we recorded interest expense of $354,949 related to the contractual interest rates of our convertible notes and interest expense of $4,284 related to the amortization of debt discounts on the convertible notes for a total of $359,233.
	Convertible Notes Payable – Non-Current Portion:
	September 2010 12% Convertible Notes		317,072			–			317,072		35,034	Convertible Notes Payable consisted of the following at March 31, 2013:
	April 2011 12% Convertible Notes		448,448			–			448,448		12,117
	September 2011 12% Convertible Notes		10,931			–			10,931		–		Principal			Unamortized			Net		Accrued
	Total – Convertible Notes Payable – Non-Current Portion		776,451			–			776,451		47,151					Discount			Amount		Interest
	Total Convertible Notes Payable	$	2,144,106		$	–		$	2,144,106	$	796,963	Amended and Restated Series A 12% Convertible Notes, past due	$	885,000		$	–		$	885,000	$	398,250
												2008 10% Convertible Notes, past due		25,000			–			25,000		15,417
	There were no discounts remaining on any of our Convertible Notes Payable as of March 31, 2014.											December 2006 10% Convertible Notes, past due		17,000			–			17,000		15,888
												October & November 2009 10% Convertible Notes		50,000			(389	)		49,611		20,000
	NOVEMBER 2014 10% CONVERTIBLE NOTES											April 2010 10% Convertible Note		75,000			(3,895	)		71,105		23,938
												September 2010 10% Convertible Notes, past due		308,100			–			308,100		52,393
	In November 2014, we entered into a Subscription Agreement with two accredited investors providing for the issuance and sale of (i) convertible promissory notes (the “November 2014 10% Convertible Notes”) in the aggregate principal amount of $527,780 and (ii) five year warrants to purchase up to 2,356,160 shares of Common Stock at a fixed exercise price of $8.40 per share. The November 2014 10% Convertible Notes bear interest at the annual rate of 10% and mature on April 1, 2016.											April 2011 10% Convertible Notes, past due		400,400			–			400,400		100,100
												July and August 2011 10% Convertible Notes, $257,656 past due		357,655			–			357,655		68,704
	The aggregate gross cash proceeds to us were $415,000 after subtracting legal fees of $35,000; the balance of the principal amount of the notes represents a $27,780 due diligence fee and an original issuance discount. We recorded deferred financing costs of $112,780 to reflect the legal fees, due diligence fee and original issuance discount and will amortize those costs over the life of the notes using the effective interest method.											September 2011 Convertible Notes, past due		178,760			–			178,760		–
												Law Firm Note		75,000			–			75,000		3,854
	The estimated relative fair value of warrants issued in connection with the November 2014 10% Convertible Notes is recorded as a debt discount and is amortized as additional interest expense over the term of the underlying debt. We recorded debt discount of $240,133 based on the relative fair value of these warrants. In addition, as the effective conversion price of the debt was less than market price of the underlying common stock on the date of issuance, we recorded an additional debt discount of $287,647 related to the beneficial conversion feature. As of December 31, 2014, the $527,780 principal amount outstanding under this agreement is presented net of unamortized debt discount of $465,687.											Total – Convertible Notes Payable	$	2,371,915		$	(4,284	)	$	2,367,631	$	698,544
	The November 2014 10% Convertible Notes are convertible at the option of the holders into shares of our common stock at a fixed price of $5.60 per share, for up to an aggregate of 94,246 shares of Common Stock. There are no registration requirements with respect to the shares of common stock underlying the notes or the warrants.											During the fiscal year ended March 31, 2013, we recorded interest expense of $459,199 related to the contractual interest rates of our convertible notes and interest expense of $467,158 related to the amortization of debt discounts on the convertible notes for a total of $926,357.
	The pricing on both the conversion price and on the warrant exercise price reflected a negotiation that began in September 2014 and continued through funding in November 2014. During that period of time the price of our common stock rose significantly, which complicated the pricing negotiations. We ended up with pricing the notes and warrants at levels consistent with our prior equity unit issuances in October 2014 (see Note 6).											AMENDED AND RESTATED SERIES A 12% CONVERTIBLE NOTES
	APRIL 2011 12% CONVERTIBLE NOTES											In June 2010, we entered into Amended and Restated Series A 12% Convertible Promissory Notes (the "Amended and Restated Notes") with the holders of certain promissory notes previously issued by the Company, extending the due date to December 31, 2010 on the aggregate principal balance of $900,000. During the fiscal year ended March 31, 2013, the holders of $15,000 of the Notes converted their principal and related accrued interest into common stock. The balance remaining at March 31, 2014 and 2013 was $885,000 and is past due as of March 31, 2014. Such notes bear a default annual interest rate of 20%.
	In April 2011, we entered into a Subscription Agreement with two accredited investors (the “Purchasers”) providing for the issuance and sale of convertible promissory notes and corresponding warrants in the aggregate principal amount of $385,000. The closing under the Subscription Agreement resulted in the issuance and sale by us of (i) convertible promissory notes in the aggregate principal amount of $385,000, (ii) five-year warrants to purchase an aggregate of 80,080 shares of our common stock at an exercise price of $6.25 per share, and (iii) five-year warrants to purchase an aggregate of 80,080 shares of our common stock at an exercise price of $8.75 per share. The convertible promissory notes bear interest compounded monthly at the annual rate of 10% and mature on April 1, 2016 (see below). The aggregate gross cash proceeds to us were $350,000, the balance of the principal amount representing a due diligence fee and an original issuance discount. The convertible promissory notes are convertible at the option of the holders into shares of our common stock at a price per share equal to eighty percent (80%) of the average of the three lowest closing bid prices of the common stock as reported by Bloomberg L.P. for the principal market on which the common stock trades or is quoted for the ten (10) trading days preceding the proposed conversion date. Subject to adjustment as described in the notes, the conversion price may not be more than $10.00 nor less than $5.00. There are no registration requirements with respect to the shares of common stock underlying the notes or the warrants.											Subsequent to year end on June 24, 2014, we entered into an agreement with the Ellen R. Weiner Family Revocable Trust (the “Trust”), a holder of a Series A 12% Convertible Note (the “Note”), whereby the Trust converted a past due combined principal and interest balance of $1,003,200 (principal of $660,000 and interest of $343,200) into restricted common stock.
	In addition, we issued (i) five-year warrants to purchase an aggregate of 16,250 shares of our common stock at an exercise price of $6.25 per share, and (ii) five-year warrants to purchase an aggregate of 16,250 shares of our common stock at an exercise price of $8.75 per share to the Purchasers. These warrants were issued as an antidilution adjustment under certain common stock purchase warrants held by the Purchasers that were acquired from us in September 2010.											Additionally, the Trust agreed to waive anti-dilution price protection underlying warrants previously issued to the Trust. Under its agreement, the Trust converted the entire $1,003,200 past due principal and interest balance on the Note
	On March 31, 2014, we entered into separate Amendments to Convertible Notes and Warrants (collectively, the “Amendments”) with three accredited investors (collectively, the “Investors”) who own certain convertible promissory notes (collectively, the “Notes”) and warrants (collectively, the “Warrants”) previously issued by us on various dates between December 5, 2007 and September 23, 2011, including the April 2011 Convertible Notes.											In exchange for the Trust’s conversion in full of the Note and accrued interest and for the waivers of anti-dilution price protection in previously issued warrants, we (1) issued five-year warrants to acquire up to 136,190 shares of our common stock at an exercise price of $2.10 per share and up to 7,944 shares of our common stock at an exercise price of $5.40 per share (collectively, the “Conversion Securities”); (2) issued 1,500 restricted shares of common stock as a service fee; (3) changed the exercise price of all of the previously issued warrants to the Trust to $2.10 per share; and (4) extended the expiration date of all of the previously issued warrants to the Trust to July 1, 2018.
	Prior to the Amendments, the Notes were past maturity and were in default, resulting in the accrual of interest at the applicable default interest rate. The Amendments extended the maturity date of each of the Notes to April 1, 2016, which permits us to classify them as long-term liabilities. As a result of the Amendments, the Notes are no longer in default and the non-default interest rate for all of the Notes was set at 12% per annum, which represents a reduction from the default interest rates of 15% at which interest had been accruing. By entering into the Amendments, we also agreed to increase the currently outstanding principal amount of the Notes by 12% from a total of $693,260 to a total of $776,451.											We continue to hold discussions with the holder of the remaining note in this grouping regarding either an extension to the note or a conversion of the note but there can be no assurance that we will be able to do so on terms that we deem acceptable or at all. We are recording interest at the default rate of 20% on the remaining note.
	During the period from October 2011 to February 2014, the Investors had converted, at conversion prices between $2.73 and $3.50 per share, portions of principal and interest outstanding under the Notes and certain other convertible promissory notes previously issued to them by us. Certain antidilution provisions applicable to such notes should have resulted in such conversions being effected at a conversion price of $2.10 per share. Accordingly, pursuant to the Amendments, we issued to the investors an aggregate of 90,142 shares of the Company’s Common Stock, which represents the additional shares of Common Stock that would have been issued to the Investors had such conversions been effected at $2.10 per share.											DECEMBER 2006 10% CONVERTIBLE NOTES
	The Amendments also set the conversion price of the Notes, as well as the exercise price at which shares of our common stock can be purchased under the Warrants, at $2.10 per share. By virtue of the Amendments, the expiration dates of the Warrants also were extended from dates between September 3, 2015 and September 23, 2016 to January 1, 2017.											In January 2014, we paid off the remaining balance of the December 2006 10% Convertible Notes and the related accrued interest balance with a cash payment of $35,055. Such payment represented the sum of the $17,000 in principal balance and $18,055 in accrued interest.
	The following table shows the conversions into principal of the April 2011 12% Convertible Notes by fiscal year:											2008 10% CONVERTIBLE NOTES
	Activity in the April 2011 12% Convertible Notes											One 2008 10% Convertible Note in the amount of $25,000 which matured in January 2010 remained outstanding and past due at March 31, 2014. Such note is convertible into our common stock at $25.00 per share. We are recording interest at the default rate of 15%.
	Initial principal balance	$	400,400
	Increase in principal balance due to extension fee		48,048									OCTOBER & NOVEMBER 2009 10% CONVERTIBLE NOTES
	Conversions during the nine months ended December 31, 2014		(246,289	)
	Balance as of December 31, 2014	$	202,159									In October and November 2009, we raised $430,000 from the sale to accredited investors of 10% convertible notes ("October & November 2009 10% Convertible Notes"). The October & November 2009 10% Convertible Notes matured at various dates between April 2011 and May 2011 and are convertible into our common stock at a fixed conversion price of $12.50 per share. The investors also received matching three year warrants to purchase unregistered shares of our common stock at an exercise price of $12.50 per share. We measured the fair value of the warrants and the beneficial conversion feature of the notes and recorded a 100% discount against the principal of the notes. Such discount was fully amortized at March 31, 2014.
	AMENDED AND RESTATED SERIES A 12% CONVERTIBLE NOTES											In July 2012, we issued 9,228 shares of common stock and 4,614 warrants to purchase common stock to the holder of a $25,000 note in this grouping in exchange for the conversion of such note and related accrued interest of $8,000 (for a total of $33,000). The warrants expired in 2012 and are exercisable at $5.35 per share (see Note 6). We recorded a loss on conversion of $45,796.
	In June 2010, we entered into Amended and Restated Series A 12% Convertible Promissory Notes (the "Amended and Restated Notes") with the holders of certain promissory notes previously issued by us, extending the due date to December 31, 2010 on the aggregate principal balance of $900,000. During the fiscal year ended March 31, 2013, the holders of $15,000 of the Notes converted their principal and related accrued interest into common stock. The balance remaining at March 31, 2014 was $885,000 and past due.											The following table shows the conversions into principal of the October and November 2009 Convertible Notes by fiscal year:
	Weiner Note Conversion											Activity in October & November 2009 10% Convertible Notes
												Initial principal balance	$	450,250
	On June 24, 2014, we entered into an agreement with the Ellen R. Weiner Family Revocable Trust (the “Trust”), a holder of a Series A 12% Convertible Note (the “Note”), which previously was classified as being in default. As per the agreement, the Trust converted past due principal of $660,000 and accrued interest balance of $343,200 into restricted common stock.											Conversions during the fiscal year ended March 31, 2010		(70,000	)
												Conversions during the fiscal year ended March 31, 2011		(175,000	)
	Additionally, the Trust agreed to waive anti-dilution price protection underlying warrants previously issued to the Trust. On June 26, 2014, three other parties who held similar warrants also agreed to waive their anti-dilution price protection.											Conversions during the fiscal year ended March 31, 2012		(130,250	)
												Conversions during the fiscal year ended March 31, 2013		(25,000	)
	Under its agreement, the Trust converted the entire $1,003,200 past due principal and interest balance on the Note, which previously was in default, into an aggregate of 466,365 restricted shares of our common stock and five-year warrants to acquire up to 136,190 shares of our common stock at an exercise price of $2.10 per share (which exercise price was the result of certain contractual price adjustments previously made during 2011) and up to 7,944 shares of our common stock at an exercise price of $5.40 per share (collectively, the “Conversion Securities”). Based on the fair value of the warrants and shares issued to the Trust for the accrued interest, we recorded a loss on settlement of notes of $1,791,421.											Conversions during the fiscal year ended March 31, 2014		–
											Balance as of March 31, 2014	$	50,000
In exchange for the Trust’s conversion in full of the Note and accrued interest and for the waivers of anti-dilution price protection in the previously issued warrants, in addition to the Conversion Securities, we issued to the Trust 1,500 restricted shares of common stock as a service fee, changed the exercise price of all of the previously issued warrants to $2.10 per share and extended the expiration date of all of the previously issued warrants to July 1, 2018. We valued the 1,500 share service fee at $12,000 based on our closing price on the date of the agreement and recorded that value as interest expense during the June 2014 period.
											On March 31, 2012, we agreed to extend the expiration date and to change the exercise price of certain warrants of one of the note holders by two years in exchange for the extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note (see below) by that same two year period. We recorded a charge of $77,265 relating to this modification.
Bird Estate Extension
											In September 2013, we agreed to extend the expiration date of certain warrants of one of the note holders by two years in exchange for the extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note (see below) by that same two year period. Management assessed the change in the value of the notes and related warrants before and after that extension and determined that the change in value related to the change in terms was not significant.
On July 8, 2014, we executed a written restructuring agreement (the “Agreement”) with the Estate of Allan Bird (the “Estate”), a holder of a Series A 12% Convertible Note (the “Note”), which previously was classified as being in default. Since the negotiations for the Agreement were completed in the month of June, we recorded the impact of the Agreement as of June 30, 2014. In the Agreement, the Estate agreed to extend the expiration date of the Note to April 1, 2016, to convert approximately $116,970 of accrued interest to equity, and to waive anti-dilution price protection underlying the Note and warrants previously issued to the Estate.
											APRIL 2010 10% CONVERTIBLE NOTE
Under the Agreement, the Estate converted the entire $116,970 past due interest balance on the Note, which previously was in default, into an aggregate of 51,837 restricted shares of our common stock. The Estate received five-year warrants to acquire up to 46,429 shares of our common stock at an exercise price of $2.10 per share (which exercise price was the result of certain contractual price adjustments previously made during 2011). Based on our common stock prices during a period of negotiation with the Estate including during calendar year 2013, the Estate also received five-year warrants to acquire up to 2,708 shares of our common stock at an exercise price of $5.40 (collectively known as the “Conversion Securities”). Based on the fair value of the warrants and shares issued to the Estate for the accrued interest, we recorded a loss on settlement of notes of $663,209.
											In April 2010, we raised $75,000 from the sale to an accredited investor of a 10% convertible note. The convertible note was originally scheduled to mature in October 2011 and is convertible into our common stock at a fixed conversion price of $12.50 per share prior to maturity. The investor also received three year warrants to purchase 300,000 unregistered shares of our common stock at a price of $12.50 per share.
In exchange for the Estate’s extension of the Note, conversion of accrued interest and for the waivers of anti-dilution price protection in the previously issued warrants, in addition to the Conversion Securities, we also issued to the Estate 500 restricted shares of common stock as an extension fee and extended the expiration date of all of the previously issued warrants to July 1, 2018. We valued the 500 share extension fee at $4,500 based on our closing price and recorded that value as a deferred financing cost, which we will amortize over the extended two year life of the note.
											We measured the fair value of the warrants and the beneficial conversion feature of the notes and recorded a 100% discount against the principal of the notes. We amortized this discount using the effective interest method over the term of the note. As of March 31, 2014, there have not been any conversions of the April 2010 10% Convertible Note.
Bird Estate Conversion
											On March 31, 2012, we agreed to extend the expiration date and to change the exercise price of certain warrants of the note holder by two years in exchange for his extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note by that same two year period.
In November 18, 2014, we issued an aggregate of 112,500 shares of common stock to the Estate upon the conversion of an aggregate of $236,250 representing all $225,000 of unpaid principal and $11,250 of unpaid accrued interest due under the Note. The conversion price per share was $2.10.
											In September 2013, we agreed to extend the expiration date of certain warrants of one of the note holders by two years in exchange for the extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note (see below) by that same two year period. Management assessed the change in the value of the notes and related warrants before and after that extension and determined that the change in value related to the change in terms was not significant.
2008 10% CONVERTIBLE NOTES
											SEPTEMBER 2010 10% CONVERTIBLE NOTES
In September 2014, we issued to the holder of the remaining 2008 10% Convertible Note units consisting of an aggregate of 9,564 shares of restricted common stock and unit warrants to acquire up to an aggregate of 4,782 shares of common stock at an exercise price of $4.80 per share (see Note 6). The units were issued to the Note holder upon the conversion of an aggregate of $45,906 of unpaid principal and accrued interest due under the Note, which represented the entire amount outstanding under the Note and the Note was retired. We recorded a loss on debt conversion of $65,493 on this transaction.
											On September 3, 2010, we entered into a Subscription Agreement with three accredited investors (the “Purchasers”) providing for the issuance and sale of convertible promissory notes and corresponding warrants in the aggregate principal amount of $1,430,000. The initial closing under the Subscription Agreement resulted in the issuance and sale of (i) convertible promissory notes in the aggregate principal amount of $743,600, (ii) five-year warrants to purchase an aggregate of 74,360 shares of our common stock at an exercise price of $15.56 per share, and (iii) five-year warrants to purchase an aggregate of 74,360 shares of our common stock at an exercise price of $21.79 per share. The convertible promissory notes bear interest compounded monthly at the annual rate of ten percent (10%) and mature on April 1, 2016 (see below). The aggregate gross cash proceeds were $650,000, the balance of the principal amount representing a due diligence fee and an original issuance discount. The convertible promissory notes are convertible at the option of the holders into shares of our common stock at a price per share equal to eighty percent (80%) of the average of the three lowest closing bid prices of the common stock as reported by Bloomberg L.P. for the principal market on which the common stock trades or is quoted for the ten (10) trading days preceding the proposed conversion date. Subject to adjustment as described in the notes, the conversion price may not be more than $15.00 nor less than $10.00. There are no registration requirements with respect to the shares of common stock underlying the notes or the warrants.
OCTOBER & NOVEMBER 2009 10% CONVERTIBLE NOTES
											On March 31, 2014, we entered into separate Amendments to Convertible Notes and Warrants (collectively, the “Amendments”) with three accredited investors (collectively, the “Investors”) who own certain convertible promissory notes (collectively, the “Notes”) and warrants (collectively, the “Warrants”) previously issued by us on various dates between December 5, 2007 and September 23, 2011, including the September 2010 Convertible Notes.
In October and November 2009, we raised $430,000 from the sale to accredited investors of 10% convertible notes ("October & November 2009 10% Convertible Notes"). The October & November 2009 10% Convertible Notes matured at various dates between April 2011 and May 2011 and are convertible into our common stock at a fixed conversion price of $12.50 per share. The investors also received matching three year warrants to purchase unregistered shares of our common stock at an exercise price of $12.50 per share. We measured the fair value of the warrants and the beneficial conversion feature of the Notes and recorded a 100% discount against the principal of the notes. Such discount was fully amortized at March 31, 2014.
											Prior to the Amendments, the Notes were past maturity and were in default, resulting in the accrual of interest at the applicable default interest rate. The Amendments extended the maturity date of each of the Notes to April 1, 2016, which permits us to classify them as long-term liabilities. As a result of the Amendments, the Notes are no longer in default and the non-default interest rate for all of the Notes was set at 12% per annum, which represents a reduction from the default interest rates of fifteen percent at which interest had been accruing. By entering into the Amendments, we also agreed to increase the currently outstanding principal amount of the Notes by 12% from a total of $693,260 to a total of $776,451.
In July 2012, we issued 9,228 shares of common stock and 4,614 warrants to purchase common stock to the holder of a $25,000 note in this grouping in exchange for the conversion of such note and related accrued interest of $8,000 (for a total of $33,000). The warrants expired in 2012 and are exercisable at $5.35 per share (see Note 6). We recorded a loss on conversion of $45,796.
											During the period from October 2011 to February 2014, the Investors had converted, at conversion prices between $2.73 and $3.50 per share, portions of principal and interest outstanding under the Notes and certain other convertible promissory notes previously issued to them by us. Certain antidilution provisions applicable to such notes should have resulted in such conversions being effected at a conversion price of $2.10 per share. Accordingly, pursuant to the Amendments, we issued to the investors an aggregate of 90,142 shares of the Company’s Common Stock, which represents the additional shares of Common Stock that would have been issued to the Investors had such conversions been effected at $2.10 per share.
The following table shows the conversions into principal of the October and November 2009 10% Convertible Notes by fiscal year:
											The Amendments also provide that if all of our currently outstanding promissory notes and warrants that contain antidilution adjustment provisions (other than the Investors’ Notes and Warrants) are amended to remove, or the holders thereof waive, such provisions, then any similar antidilution provisions in the Investors’ Notes and Warrants will automatically be deemed removed. In addition, for so long as the Investors’ Notes and Warrants are outstanding, we will not be permitted to issue any common stock or common stock equivalents (or modify, with equivalent effect, any outstanding common stock or common stock equivalents) at a lower price than the then-current conversion price of the Notes and exercise price of the Warrants (with certain issuances to be excepted from this general provision). If our other note and warrant holders agree to waive the antidilution provisions of their securities on the same basis as agreed to by the Investors, then we will no longer be required to report a derivative liability in its financial statements with the accompanying quarterly adjustments to its financial statements and will transfer the amount shown as a derivative liability to equity.
Activity in October & November 2009 10% Convertible Notes
Initial principal balance	$	450,250									The Amendments also set the conversion price of the Notes, as well as the exercise price at which shares of our common stock can be purchased under the Warrants, at $2.10 per share. By virtue of the Amendments, the expiration dates of the Warrants also were extended from dates between September 3, 2015 and September 23, 2016 to January 1, 2017.
Conversions during the fiscal year ended March 31, 2010		(70,000	)
Conversions during the fiscal year ended March 31, 2011		(175,000	)								The following table shows the activity in the September 2010 10% Convertible Notes by fiscal year:
Conversions during the fiscal year ended March 31, 2012		(130,250	)
Conversions during the fiscal year ended March 31, 2013		(25,000	)								Activity in the September 2010 10% Convertible Notes
Conversions during the fiscal year ended March 31, 2014		–									Initial principal balance	$	743,600
Conversions into equity unit structure during the nine months ended December 31, 2014		(50,000	)								Conversions during the fiscal year ended March 31, 2012		(405,500	)
Balance as of December 31, 2014	$	–									Conversions during the fiscal year ended March 31, 2013		(30,000	)
											Conversions during the fiscal year ended March 31, 2014		(25,000	)
As noted in the above table, the remaining balance of the September 2011 Convertible Notes converted into equity during the nine months ended December 31, 2014.											Increase in principal balance due to 12% extension fee		33,972
											Balance as of March 31, 2014	$	317,072
On March 31, 2012, we agreed to extend the expiration date and to change the exercise price of certain warrants of one of the note holders by two years in exchange for the extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note (see below) by that same two year period. We recorded a charge of $77,265 relating to this modification.
											APRIL 2011 10% CONVERTIBLE NOTES
In September 2013, we agreed to extend the expiration date of certain warrants of one of the note holders by two years in exchange for the extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note (see below) by that same two year period. Management assessed the change in the value of the notes and related warrants before and after that extension and determined that the change in value related to the change in terms was not significant.
											In April 2011, we entered into a Subscription Agreement with two accredited investors (the “Purchasers”) providing for the issuance and sale of convertible promissory notes and corresponding warrants in the aggregate principal amount of $385,000. The closing under the Subscription Agreement resulted in the issuance and sale by us of (i) convertible promissory notes in the aggregate principal amount of $385,000, (ii) five-year warrants to purchase an aggregate of 80,080 shares of our common stock at an exercise price of $6.25 per share, and (iii) five-year warrants to purchase an aggregate of 80,080 shares of our common stock at an exercise price of $8.75 per share. The convertible promissory notes bear interest compounded monthly at the annual rate of 10% and mature on April 1, 2016 (see below). The aggregate gross cash proceeds to us were $350,000, the balance of the principal amount representing a due diligence fee and an original issuance discount. The convertible promissory notes are convertible at the option of the holders into shares of our common stock at a price per share equal to eighty percent (80%) of the average of the three lowest closing bid prices of the common stock as reported by Bloomberg L.P. for the principal market on which the common stock trades or is quoted for the ten (10) trading days preceding the proposed conversion date. Subject to adjustment as described in the notes, the conversion price may not be more than $10.00 nor less than $5.00. There are no registration requirements with respect to the shares of common stock underlying the notes or the warrants.
In October 2014, we issued to the holder of the remaining October & November 2009 10% Convertible Note and the April 2010 10% Convertible Note units consisting of an aggregate of 36,716 shares of common stock and unit warrants to acquire up to an aggregate of 36,756 shares of common stock at an exercise price of $5.15 per share. The units were issued to the note holder upon the conversion of an aggregate of $189,087 of unpaid principal and accrued interest due under two promissory notes (the remaining October & November 2009 10% Convertible Note and the April 2010 10% Convertible Note). The amounts converted represented the entire principal and interest outstanding under the notes and the notes held by that holder were retired.
											In addition, we issued (i) five-year warrants to purchase an aggregate of 16,250 shares of our common stock at an exercise price of $6.25 per share, and (ii) five-year warrants to purchase an aggregate of 16,250 shares of our common stock at an exercise price of $8.75 per share to the Purchasers. These warrants were issued as an antidilution adjustment under certain common stock purchase warrants held by the Purchasers that were acquired from us in September 2010.
APRIL 2010 10% CONVERTIBLE NOTE
											On March 31, 2014, we entered into separate Amendments to Convertible Notes and Warrants (collectively, the “Amendments”) with three accredited investors (collectively, the “Investors”) who own certain convertible promissory notes (collectively, the “Notes”) and warrants (collectively, the “Warrants”) previously issued by us on various dates between December 5, 2007 and September 23, 2011, including the April 2011 Convertible Notes.
In April 2010, we raised $75,000 from the sale to an accredited investor of a 10% convertible note. The convertible note was originally scheduled to mature in October 2011 and is convertible into our common stock at a fixed conversion price of $12.50 per share prior to maturity. The investor also received three year warrants to purchase 6,000 unregistered shares of our common stock at a price of $12.50 per share.
											Prior to the Amendments, the Notes were past maturity and were in default, resulting in the accrual of interest at the applicable default interest rate. The Amendments extended the maturity date of each of the Notes to April 1, 2016, which permits us to classify them as long-term liabilities. As a result of the Amendments, the Notes are no longer in default and the non-default interest rate for all of the Notes was set at 12% per annum, which represents a reduction from the default interest rates of 15% at which interest had been accruing. By entering into the Amendments, we also agreed to increase the currently outstanding principal amount of the Notes by 12% from a total of $693,260 to a total of $776,451.
We measured the fair value of the warrants and the beneficial conversion feature of the notes and recorded a 100% discount against the principal of the notes. We amortized this discount using the effective interest method over the term of the note.
											During the period from October 2011 to February 2014, the Investors had converted, at conversion prices between $2.73 and $3.50 per share, portions of principal and interest outstanding under the Notes and certain other convertible promissory notes previously issued to them by us. Certain antidilution provisions applicable to such notes should have resulted in such conversions being effected at a conversion price of $2.10 per share. Accordingly, pursuant to the Amendments, we issued to the investors an aggregate of 90,142 shares of the Company’s Common Stock, which represents the additional shares of Common Stock that would have been issued to the Investors had such conversions been effected at $2.10 per share.
On March 31, 2012, we agreed to extend the expiration date and to change the exercise price of certain warrants of the note holder by two years in exchange for his extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note by that same two year period.
											The Amendments also provide that if all of our currently outstanding promissory notes and warrants that contain antidilution adjustment provisions (other than the Investors’ Notes and Warrants) are amended to remove, or the holders thereof waive, such provisions, then any similar antidilution provisions in the Investors’ Notes and Warrants will automatically be deemed removed. In addition, for so long as the Investors’ Notes and Warrants are outstanding, we will not be permitted to issue any common stock or common stock equivalents (or modify, with equivalent effect, any outstanding common stock or common stock equivalents) at a lower price than the then-current conversion price of the Notes and exercise price of the Warrants (with certain issuances to be excepted from this general provision).
In September 2013, we agreed to extend the expiration date of certain warrants of one of the note holders by two years in exchange for the extension of $50,000 of the October & November 2009 10% Convertible Notes and the $75,000 April 2010 10% Convertible Note (see below) by that same two year period. Management assessed the change in the value of the notes and related warrants before and after that extension and determined that the change in value related to the change in terms was not significant.
											The Amendments also set the conversion price of the Notes, as well as the exercise price at which shares of our common stock can be purchased under the Warrants, at $2.10 per share. By virtue of the Amendments, the expiration dates of the Warrants also were extended from dates between September 3, 2015 and September 23, 2016 to January 1, 2017.
In October 2014, we issued to the holder of the remaining October & November 2009 10% Convertible Note and the April 2010 10% Convertible Note units consisting of an aggregate of 36,716 shares of common stock and unit warrants to acquire up to an aggregate of 36,756 shares of common stock at an exercise price of $5.15 per share. The units were issued to the note holder upon the conversion of an aggregate of $189,087 of unpaid principal and accrued interest due under two promissory notes (the remaining October & November 2009 10% Convertible Note and the April 2010 10% Convertible Note). The amounts converted represented the entire principal and interest outstanding under the notes and the notes held by that holder were retired.
											As of March 31, 2014, there have not been any conversions of the April 2011 10% Convertible Notes and the 12% extension fee noted above increased the principal balance by $48,048 to a principal balance of $448,448.
SEPTEMBER 2010 12% CONVERTIBLE NOTES
											JULY & AUGUST 2011 10% CONVERTIBLE NOTES
On September 3, 2010, we entered into a Subscription Agreement with three accredited investors (the “Purchasers”) providing for the issuance and sale of convertible promissory notes and corresponding warrants in the aggregate principal amount of $1,430,000. The initial closing under the Subscription Agreement resulted in the issuance and sale of (i) convertible promissory notes in the aggregate principal amount of $743,600, (ii) five-year warrants to purchase an aggregate of 74,360 shares of our common stock at an exercise price of $15.56 per share, and (iii) five-year warrants to purchase an aggregate of 74,360 shares of our common stock at an exercise price of $21.79 per share. The convertible promissory notes bear interest compounded monthly at the annual rate of ten percent (10%) and mature on April 1, 2016 (see below). The aggregate gross cash proceeds were $650,000, the balance of the principal amount representing a due diligence fee and an original issuance discount. The convertible promissory notes are convertible at the option of the holders into shares of our common stock at a price per share equal to eighty percent (80%) of the average of the three lowest closing bid prices of the common stock as reported by Bloomberg L.P. for the principal market on which the common stock trades or is quoted for the ten (10) trading days preceding the proposed conversion date. Subject to adjustment as described in the notes, the conversion price may not be more than $15.00 nor less than $10.00. There are no registration requirements with respect to the shares of common stock underlying the notes or the warrants.
											During the three months ended September 30, 2011, we raised $357,656 in 10% convertible notes. Those notes had a fixed conversion price of $4.50 per share and carried an interest rate of 10%. The convertible notes matured in July and August 2012. We also issued those investors five year warrants to purchase 79,479 shares of common stock at $6.25 per share.
On March 31, 2014, we entered into separate Amendments to Convertible Notes and Warrants (collectively, the “Amendments”) with three accredited investors (collectively, the “Investors”) who own certain convertible promissory notes (collectively, the “Notes”) and warrants (collectively, the “Warrants”) previously issued by us on various dates between December 5, 2007 and September 23, 2011, including the September 2010 Convertible Notes.
											We measured the fair value of the warrants and the beneficial conversion feature of the notes and recorded a $257,926 discount against the principal of the notes. We amortized this discount using the effective interest method over the term of the note.
Prior to the Amendments, the Notes were past maturity and were in default, resulting in the accrual of interest at the applicable default interest rate. The Amendments extended the maturity date of each of the Notes to April 1, 2016, which permits us to classify them as long-term liabilities. As a result of the Amendments, the Notes are no longer in default and the non-default interest rate for all of the Notes was set at 12% per annum, which represents a reduction from the default interest rates of fifteen percent at which interest had been accruing. By entering into the Amendments, we also agreed to increase the currently outstanding principal amount of the Notes by 12% from a total of $693,260 to a total of $776,451.
											Effective March 31, 2014, the holders of the three notes totaling $100,000 converted all of their principal and accrued interest into 28,774 shares of our common stock at the contractual conversion price of $4.50 per share.
During the period from October 2011 to February 2014, the Investors had converted, at conversion prices between $2.73 and $3.50 per share, portions of principal and interest outstanding under the Notes and certain other convertible promissory notes previously issued to them by us. Certain antidilution provisions applicable to such notes should have resulted in such conversions being effected at a conversion price of $2.10 per share. Accordingly, pursuant to the Amendments, we issued to the investors an aggregate of 90,142 shares of the Company’s Common Stock, which represents the additional shares of Common Stock that would have been issued to the Investors had such conversions been effected at $2.10 per share.
											At March 31, 2014, the remaining outstanding principal balance was $257,655, all of which was in default. We are recording interest at the default interest rate of 15%.
The Amendments also set the conversion price of the Notes, as well as the exercise price at which shares of our common stock can be purchased under the Warrants, at $2.10 per share. By virtue of the Amendments, the expiration dates of the Warrants also were extended from dates between September 3, 2015 and September 23, 2016 to January 1, 2017.
											SEPTEMBER 2011 CONVERTIBLE NOTES
The following table shows the activity in the September 2010 12% Convertible Notes by fiscal year:
											In September 2011, we issued $253,760 of convertible notes, convertible at $3.50 per share. Such notes originally matured in September 2012.
Activity in the September 2010 12% Convertible Notes
Initial principal balance	$	743,600									On March 31, 2014, we entered into separate Amendments to Convertible Notes and Warrants (collectively, the “Amendments”) with three accredited investors (collectively, the “Investors”) who own certain convertible promissory notes (collectively, the “Notes”) and warrants (collectively, the “Warrants”) previously issued by us on various dates between December 5, 2007 and September 23, 2011, including the September 2011 Convertible Notes.
Conversions during the fiscal year ended March 31, 2012		(405,500	)
Conversions during the fiscal year ended March 31, 2013		(30,000	)								Prior to the Amendments, the Notes were past maturity and were in default, resulting in the accrual of interest at the applicable default interest rate. The Amendments extended the maturity date of each of the Notes to April 1, 2016, which permits us to classify them as long-term liabilities. As a result of the Amendments, the Notes are no longer in default and the non-default interest rate for all of the Notes was set at 12% per annum, which represents a reduction from the default interest rates of 15% at which interest had been accruing. By entering into the Amendments, we also agreed to increase the currently outstanding principal amount of the Notes by 12%, which in the case of the September 2011 Notes, they increased from $9,760 to $10,931
Conversions during the fiscal year ended March 31, 2014		(25,000	)
Increase in principal balance due to 12% extension fee		33,972									During the period from October 2011 to February 2014, the Investors had converted, at conversion prices between $2.73 and $3.50 per share, portions of principal and interest outstanding under the Notes and certain other convertible promissory notes previously issued to them by us. Certain antidilution provisions applicable to such notes should have resulted in such conversions being effected at a conversion price of $2.10 per share. Accordingly, pursuant to the Amendments, we issued to the investors an aggregate of 90,142 shares of the Company’s Common Stock, which represents the additional shares of Common Stock that would have been issued to the Investors had such conversions been effected at $2.10 per share.
Conversions during the nine months ended December 31, 2014		(317,072	)
Balance as of December 31, 2014	$	–									The Amendments also provide that if all of our currently outstanding promissory notes and warrants that contain antidilution adjustment provisions (other than the Investors’ Notes and Warrants) are amended to remove, or the holders thereof waive, such provisions, then any similar antidilution provisions in the Investors’ Notes and Warrants will automatically be deemed removed. In addition, for so long as the Investors’ Notes and Warrants are outstanding, we will not be permitted to issue any common stock or common stock equivalents (or modify, with equivalent effect, any outstanding common stock or common stock equivalents) at a lower price than the then-current conversion price of the Notes and exercise price of the Warrants (with certain issuances to be excepted from this general provision). If our other note and warrant holders agree to waive the antidilution provisions of their securities on the same basis as agreed to by the Investors, then we will no longer be required to report a derivative liability in its financial statements with the accompanying quarterly adjustments to its financial statements and will transfer the amount shown as a derivative liability to equity.
As noted in the above table, the remaining balance of the September 2011 Convertible Notes converted into equity during the nine months ended December 31, 2014.											The Amendments also set the conversion price of the Notes, as well as the exercise price at which shares of our common stock can be purchased under the Warrants, at $2.10 per share. By virtue of the Amendments, the expiration dates of the Warrants also were extended to January 1, 2017.
JULY & AUGUST 2011 10% CONVERTIBLE NOTES											The following table shows the conversions into principal of the September 2011 Convertible Notes by fiscal year:
During the three months ended September 30, 2011, we raised $357,656 in five separate 10% convertible notes. Those notes had a fixed conversion price of $4.50 per share and carried an interest rate of 10%. The convertible notes matured in July and August 2012. We also issued those investors five year warrants to purchase 79,479 shares of common stock at $6.25 per share.											Activity in the September 2011 Convertible Notes
											Initial principal balance	$	253,760
We measured the fair value of the warrants and the beneficial conversion feature of the notes and recorded a $257,926 discount against the principal of the notes. We amortized this discount using the effective interest method over the term of the note.											Conversions during the fiscal year ended March 31, 2012		(15,000	)
											Conversions during the fiscal year ended March 31, 2013		(60,000	)
Effective March 31, 2014, the holders of three of the five notes totaling $100,000 converted all of their principal and accrued interest into 28,774 shares of our common stock at the contractual conversion price of $4.50 per share.											Conversions during the fiscal year ended March 31, 2014		(169,000	)
											Increase in principal balance due to extension fee		1,171
In September 2014, we entered into a forbearance agreement with the holder of the remaining two notes in which we agreed to repay his notes by October 31, 2014 and in which we also agreed to extend his warrants by two years. We recorded a charge of $143,363 in the September 2014 period related to this warrant extension due to the change in the fair value of the warrants.											Balance as of March 31, 2014	$	10,931
In October 2014, we paid off in full the remaining outstanding principal balance and interest balances on the two remaining notes with cash payments of $382,748.											LAW FIRM NOTE NUMBER 1
SEPTEMBER 2011 CONVERTIBLE NOTES											On March 22, 2012, we entered into a Promissory Note with our corporate law firm for the amount of $75,000, which represented the majority of the amount we owed to that firm at that time. The Promissory Note originally had a maturity date of December 31, 2012 and bears interest at 5% per annum. The note is convertible at the option of the holder into shares of our common stock at a 10% discount to the market price of the common stock on the date prior to conversion with a floor price on such conversions of $4.00 per share. The holder subsequently agreed to extend the Maturity Date of the Note first to October 1, 2013, then to September 30, 2013, and now the expiration date of this note is again extended to October 1, 2014. As of March 31, 2014, there have not been any conversions of the Law Firm Note.
In September 2011, we issued $253,760 of convertible notes, convertible at $3.50 per share. Such notes originally matured in September 2012.											LAW FIRM NOTE NUMBER 2
On March 31, 2014, we entered into separate Amendments to Convertible Notes and Warrants (collectively, the “Amendments”) with three accredited investors (collectively, the “Investors”) who own certain convertible promissory notes (collectively, the “Notes”) and warrants (collectively, the “Warrants”) previously issued by us on various dates between December 5, 2007 and September 23, 2011, including the September 2011 Convertible Notes.											On June 4, 2013, we entered into a Promissory Note with our corporate law firm for the amount of $47,000, which represented approximately 50% of the amount we owed to that firm for services in 2012. The Promissory Note had a maturity date of October 1, 2014 and bore interest at 5% per annum. The note was convertible at the option of the holder into shares of our common stock at a 10% discount to the market price of the common stock on the date prior to conversion with a floor price on such conversions of $3.50 per share.
Prior to the Amendments, the Notes were past maturity and were in default, resulting in the accrual of interest at the applicable default interest rate. The Amendments extended the maturity date of each of the Notes to April 1, 2016, which permits us to classify them as long-term liabilities. As a result of the Amendments, the Notes are no longer in default and the non-default interest rate for all of the Notes was set at 12% per annum, which represents a reduction from the default interest rates of 15% at which interest had been accruing. By entering into the Amendments, we also agreed to increase the currently outstanding principal amount of the Notes by 12%, which in the case of the September 2011 Notes, they increased from $9,760 to $10,931											Effective March 31, 2014, our law firm converted this note and all related accrued interest into 6,041 shares of our common stock at a conversion price of $8.00 per share.
During the period from October 2011 to February 2014, the Investors had converted, at conversion prices between $2.73 and $3.50 per share, portions of principal and interest outstanding under the Notes and certain other convertible promissory notes previously issued to them by us. Certain antidilution provisions applicable to such notes should have resulted in such conversions being effected at a conversion price of $2.10 per share. Accordingly, pursuant to the Amendments, we issued to the investors an aggregate of 90,142 shares of the Company’s Common Stock, which represents the additional shares of Common Stock that would have been issued to the Investors had such conversions been effected at $2.10 per share.
The Amendments also set the conversion price of the Notes, as well as the exercise price at which shares of our common stock can be purchased under the Warrants, at $2.10 per share. By virtue of the Amendments, the expiration dates of the Warrants also were extended to January 1, 2017.
The following table shows the conversions into principal of the September 2011 Convertible Notes by fiscal year:
Activity in the September 2011 Convertible Notes
Initial principal balance	$	253,760
Conversions during the fiscal year ended March 31, 2012		(15,000	)
Conversions during the fiscal year ended March 31, 2013		(60,000	)
Conversions during the fiscal year ended March 31, 2014		(169,000	)
Increase in principal balance due to extension fee		1,171
Conversions during the nine months ended December 31, 2014		(10,931	)
Balance as of December 31, 2014	$	–
As noted in the above table, the remaining balance of the September 2011 Convertible Notes converted into equity during the nine months ended December 31, 2014.
LAW FIRM NOTE
On March 22, 2012, we entered into a Promissory Note with our corporate law firm for the amount of $75,000, which represented the majority of the amount we owed to that firm at that time. The Promissory Note originally had a maturity date of December 31, 2012 and bore interest at 5% per annum. The note was convertible at the option of the holder into shares of our common stock at a 10% discount to the market price of the common stock on the date prior to conversion with a floor price on such conversions of $4.00 per share. The holder subsequently agreed to extend the Maturity Date of the Note first to October 1, 2013, then to September 30, 2013, and then the expiration date of this note was again extended to October 1, 2014.
In November 2014, we paid off in full the Law Firm Note with a cash payment of $50,000 and an issuance of 3,400 common shares.

6_EQUITY_TRANSACTIONS

6. EQUITY TRANSACTIONS	9 Months Ended	12 Months Ended
	Dec. 31, 2014	Mar. 31, 2014
Equity [Abstract]
EQUITY TRANSACTIONS	COMMON STOCK AND WARRANTS	6. EQUITY TRANSACTIONS
	The following are Aethlon Medical, Inc.’s Equity Transactions in the Nine Months Ended December 31, 2014.	COMMON STOCK AND WARRANTS
	June 2014 Quarter Issuances of Common Stock and Warrants	Aethlon Medical, Inc. Equity Transactions in the Fiscal Year Ended March 31, 2014
	Equity Unit Investments	Common Stock Issuances in the Fiscal Year Ended March 31, 2014:
	In the three months ended June 30, 2014, we completed unit subscription agreements with seven accredited investors pursuant to which we issued 43,849 shares of our common stock and 21,924 warrants to purchase our common stock for net cash proceeds of $320,800. Such warrants have exercise prices ranging from $9.65 to $11.80 per share.	In June 2013, we completed a unit subscription agreement with three accredited investors pursuant to which we issued 31,605 shares of our common stock and 15,802 warrants to purchase our common stock for net cash proceeds of $128,000. Such warrants have an exercise price of $6.05 per share.
	Note Conversions	In June 2013, we issued to our CEO the remaining 68,000 shares under his restricted share grant, all of which were vested.
	As discussed above in Note 5, during the three months ended June 30, 2014, we issued 314,286 shares of restricted common stock to the holder of one of the Series A 12% Convertible Notes in exchange for the conversion in full of the $660,000 principal balance of that note, 152,079 shares of restricted common stock in exchange for conversion of $343,200 of accrued interest and 1,500 shares of restricted common stock as a restructuring fee. During that period, we also issued the other holder of the Series A 12% Convertible Notes 51,837 shares of restricted common stock in exchange for conversion of $116,970 of accrued interest and 500 shares of restricted common stock as a restructuring fee.	During the three months ended June 30, 2013, we issued 73,506 shares of restricted common stock to the holders of three notes issued by the Company in exchange for the partial conversion of principal and interest in an aggregate amount of $246,500 at an average conversion price of $3.35 per share.
	Common Stock Issuances	During the three months ended June 30, 2013, we issued 4,455 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $4.88 per share in payment for legal services valued at $21,750 based on the value of the services provided.
	During the three months ended June 30, 2014, we issued 4,383 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $8.73 per share in payment for legal services, internal controls consulting services and regulatory consulting services collectively valued at $38,268 based on the value of the services provided.	In August 2013, we completed a unit subscription agreement with four accredited investors (the “Purchasers”) pursuant to which we issued 18,018 shares of our common stock and 9,009 warrants to purchase our common stock in exchange for net cash proceeds of $100,000. Such warrants have an exercise price of $8.35 per share.
	September 2014 Quarter Issuances of Common Stock and Warrants	During the three months ended September 30, 2013, we issued 18,670 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $6.83 per share in payment for legal and scientific consulting services valued at $127,593 based on the value of the services provided.
	Common Stock Issuances	During the three months ended September 30, 2013, we issued 23,367 shares of restricted common stock at an average price of $4.92 per share in payment for investor relations and public relations services valued at $115,000 based on the value of the services provided.
	During the three months ended September 30, 2014, we issued 7,199 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $6.82 per share in payment for legal and scientific consulting services valued at $49,090 based on the value of the services provided.	During the three months ended September 30 2013, we issued 55,907 shares of restricted common stock to the holders of four notes issued by the Company in exchange for the partial or full conversion of principal and interest in an aggregate amount of $173,960 at an average conversion price of $3.11 per share.
	During the three months ended September 30, 2014, we issued 7,806 shares of restricted common stock at an average price of $9.61 per share in payment for investor relations consulting services valued at $75,000 based on the value of the services provided.	During the three months ended December 31, 2013, we entered into a unit purchase agreement and subscription agreements with 32 accredited investors pursuant to which we issued 287,344 shares of our common stock and warrants to purchase our common stock for gross cash proceeds of $1,795,900. Such warrants have an exercise price of $11.00 per share. A FINRA registered broker-dealer was engaged as placement agent in connection with the above Unit Purchase Agreement. We paid the placement agent an aggregate cash fee in the amount of $270,508 and will issue the placement agent or its designees warrants to purchase an aggregate of 43,102 shares of our common stock. We also paid $78,360 in other costs and fees, including legal fees, blue sky fees and escrow costs. The net proceeds that we received totaled $1,447,032.
	Note Conversions	During the three months ended December 31 2013, we issued 29,304 shares of restricted common stock to the holders of two notes issued by us in exchange for the partial or full conversion of accrued interest in an aggregate amount of $80,000 at an average conversion price of $2.73 per share.
	During the three months ended September 30, 2014, we issued 38,750 shares of restricted common stock to the holders of three convertible notes in exchange for the partial or full conversion of principal and interest in the aggregate amount of $81,375 at a conversion price of $2.10 per share.	During the three months ended March 31 2014, we issued 52,764 shares of restricted common stock to the holders of five notes issued by us in exchange for the partial or full conversion of accrued interest in an aggregate amount of $226,316 at an average conversion price of $4.29 per share.
	On July 24, 2014, we issued an aggregate of 50,079 shares of restricted common stock and a seven-year warrant to issue up to 25,040 shares of common stock at an exercise price of $6.60 per share to Dr. Chetan Shah, a director. The common stock and warrant were issued to Dr. Shah upon the conversion of an aggregate of $220,349 of unpaid principal and accrued interest due under a 10% Convertible Note previously issued to Dr. Shah by us on July 9, 2013.	During the three months ended March 31, 2014, we issued 6,935 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $9.41 per share in payment for legal services valued at $65,250 based on the value of the services provided.
	On September 17, 2014, we issued to the holder of the remaining 2008 10% Convertible Note units consisting of an aggregate of 9,564 shares of restricted common stock and unit warrants to acquire up to an aggregate of 4,782 shares of common stock at an exercise price of $4.80 per share (see Note 5). The units were issued to the note holder upon the conversion of an aggregate of $45,906 of unpaid principal and accrued interest due under the promissory note, which represented the entire amount outstanding under the note. We recorded a loss on debt conversion of $65,493 on this transaction.	During the three months ended March 31, 2014, we issued 7,996 shares of restricted common stock at an average price of $7.82 per share in payment for investor relations and public relations services valued at $62,500 based on the value of the services provided.
	Warrant Exercises and Issuance of New Warrants upon Exercise	On March 31, 2014, we entered into extension agreements with three noteholders (see Note 5). In conjunction with the extension agreements, we agreed to issue to the noteholders an aggregate 90,142 shares of restricted common stock as a result of the noteholders invoking the antidilution protection on their notes.
	During the three months ended September 30, 2014, we issued to four investors 53,465 shares of restricted common stock through the cash exercise of eight warrants for $259,474 of cash at an average exercise price of approximately $0.10 per share. As an inducement to those investors, we issued them replacement warrants to acquire up to an aggregate of 53,564 shares of common stock on the same terms as the warrants they exercised.	In March 2014, a former director exercised 3,659 in vested stock options through the contribution of $2,000 in cash and $13,000 in accrued expenses owed to him based on the exercise price of $4.10 per share.
	Equity Unit Investments	During the fiscal year ended March 31, 2014, we issued 254,325 shares of restricted common stock in connection with cashless warrant exercises discussed elsewhere in this footnote.
	During the three months ended September 30, 2014, we issued and sold to three accredited investors units consisting of (a) two thousand (2,000) restricted shares of our common stock, par value $.001 per share, at prices per share ranging from $4.55 to $4.70 and (b) a five-year warrant to purchase one thousand (1,000) shares of common stock at exercise prices ranging from $6.80 to $7.15 per share. In total, the investors purchased for cash an aggregate of $90,000 of units. The investors acquired an aggregate of 19,500 shares of common stock and warrants to acquire up to an aggregate of 9,750 shares of Common Stock.	Exosome Sciences, Inc. Equity Transactions in the Fiscal Year Ended March 31, 2014
	December 2014 Quarter Issuances of Common Stock and Warrants	On November 21, 2013, ESI, prior to the transaction described herein, a wholly owned diagnostic subsidiary of ours, entered into a stock purchase agreement with twelve accredited investors pursuant to which such investors purchased an aggregate of 220,000 shares of ESI’s common stock at a purchase price of $5.00 per share, for an aggregate purchase price of $1,100,000 in cash.
	Debt Reduction	On December 13, 2013, ESI entered into a second stock purchase agreement with three accredited investors , pursuant to which such investors purchased an aggregate of 80,000 shares of ESI’s common stock at a purchase price of $5.00 per share, for an aggregate purchase price of $400,000 in cash.
	During the three months ended December 31, 2014, we paid off in full the outstanding principal balance and interest balance on the Law Firm Note with a cash payment of $50,000 and an issuance of 3,400 common shares (see Note 4).	The aggregate gross proceeds received by ESI under these two transactions above were $1,500,000. As a result of these transactions the Company’s percentage ownership of the outstanding common stock of ESI was reduced from 100% to 80%.
	Note Conversions	One of the investors was Dr. Chetan Shah, a director of the Company. Dr. Shah purchased 70,000 ESI shares for an aggregate purchase price of $350,000.
	During the three months ended December 31, 2014, we issued an aggregate of 284,745 shares of common stock to two accredited investors upon the conversion of an aggregate of $597,965 of unpaid principal and accrued interest due under promissory notes we previously issued to the investors. The conversion price per share was $2.10 (see note 5).	Common Stock Issuances in the Fiscal Year Ended March 31, 2013:
	During the three months ended December 31, 2014, we issued an aggregate of 112,500 shares of common stock to convert in full the outstanding principal balance of $225,000 and interest balance of $11,250 on the remaining note from 2010. The conversion price per share was $2.10 (see Note 5).	During the fiscal year ended March 31, 2013, we issued 456,595 shares of restricted common stock to holders of notes issued by the Company in exchange for the partial or full conversion of principal and interest of several notes payable in an aggregate amount of $1,707,052 at an average conversion price of $3.74 per share based upon the conversion formulae in the respective notes.
	During the three months ended December 31, 2014, we issued to an accredited investor units consisting of an aggregate of 36,716 shares of common stock and warrants to acquire up to an aggregate of 18,358 shares of common stock at an exercise price of $7.70 per share. The units were issued to the investor upon the conversion of an aggregate of $189,087 of unpaid principal and accrued interest due under two promissory notes we previously issued to the investor. The amounts converted represented the entire principal and interest outstanding under the notes and the notes held by that holder were retired (see Note 5).	During the fiscal year ended March 31, 2013, we issued 38,656 restricted shares of common stock to service providers for investor relations, corporate communications and business development services valued at $170,849 based upon the fair value of the shares issued. The average issuance price on the restricted share issuances was approximately $4.42 per share.
	Issuance of Convertible Notes	During the fiscal year ended March 31, 2013, we issued 19,267 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $4.58 per share in payment for scientific consulting services valued at $88,186 based on the value of the services provided.
	During the three months ended December 31, 2014, we sold to two accredited investors (i) convertible promissory notes in the aggregate principal amount of $527,780 and (ii) five year warrants to purchase up to 47,123 shares of common stock at a fixed exercise price of $8.40 per share. The convertible promissory notes bear interest at the annual rate of 10% and mature on April 1, 2016. The aggregate gross cash proceeds to us were $415,000 after subtracting legal fees of $35,000; the balance of the principal amount of the notes represents a $27,780 due diligence fee and an original issuance discount. The convertible promissory notes are convertible at the option of the holders into shares of our common stock at a fixed price of $5.60 per share, for up to an aggregate of 94,246 shares of common stock (see Note 5).	On April 5, 2012, we completed a unit subscription agreement with one accredited investor (the “Purchaser”) pursuant to which we issued 50,000 shares of our common stock and 25,000 warrants to purchase our common stock for net cash proceeds of $200,000. Such warrants have an exercise price of $6.25 per share.
	Common Stock Issuances	On June 19, 2012, we completed a unit subscription agreement whereby we issued 164,444 shares of our common stock and 82,222 warrants to purchase our common stock at an exercise price of $5.40 per share in exchange for net cash proceeds of $592,000.
	During the three months ended December 31, 2014, we issued 7,486 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $7.32 per share in payment for legal and scientific consulting services valued at $54,800 based on the value of the services provided.	On June 26, 2012, we completed a unit subscription agreement whereby we issued 2,796 shares of our common stock and 1,398 warrants to purchase our common stock at an exercise price of $5.35 per share in exchange for net cash proceeds of $10,000.
	During the three months ended December 31, 2014, we issued 780 shares of restricted common stock at an average price of $10.26 per share in payment for investor relations consulting services valued at $8,000 based on the value of the services provided.	In July 2012, we issued 9,228 shares of common stock to the holder of a $25,000 October & November 2009 10% Convertible Note (See Note 5) in exchange for the value of the principal and related accrued interest of $8,000 under the same terms that we used to sell units consisting of one share of common stock and one-half of a stock purchase warrant on June 29, 2012 (See Note 6). As part of that structure, the noteholder also received seven year warrants to purchase 4,614 shares of our common stock at an exercise price of $5.35 per share.
	Equity Unit Investments	On August 29, 2012, we completed a unit subscription agreement with seven accredited investors pursuant to which we issued 67,750 shares of our common stock and 33,875 warrants to purchase our common stock in exchange for net cash proceeds of $271,000. Such warrants have an exercise price of $6.00 per share.
	During the three months ended December 31, 2014, we issued and sold to eight accredited investors units consisting of (a) 2,000 restricted shares of our common stock at prices per share ranging from $5.25 to $5.70 and (b) a five-year warrant to purchase 1,000 shares of common stock at exercise prices ranging from $7.70 to $8.35 per share. In total, the investors purchased for cash an aggregate of $502,700 of units. The investors acquired an aggregate of 90,125 shares of common stock and warrants to acquire up to an aggregate of 45,063 shares of common stock.	Between October 2012 and December 2012, we completed several unit subscription agreements with several accredited investors pursuant to which we issued 157,572 shares of our common stock and 78,786 warrants to purchase our common stock for net cash proceeds of $498,000. Such warrants have an exercise price based upon 120% of the average of the closing prices of our common stock for the five-day period immediately preceding the respective investment transaction date.
	During the three months ended December 31, 2014, we sold $3,300,000 of units at a price of $15.00 per unit (the “December Financing”). Each unit consists of one share of common stock and a warrant to purchase 1.2 shares of common stock at an exercise price per share of $15.00. We sold a total of 220,000 units in the financing consisting of 220,000 shares of common stock and warrants to purchase 264,000 shares of common stock at an exercise price of $15.00 per share.	In January 2013, we issued 4,929 shares of restricted common stock to the owner of a patent as a patent license payment valued at $17,250.
	Roth Capital Partners, LLC served as sole placement agent for the December Financing and received a cash fee of $231,000, expense reimbursement of $25,000, and a five-year warrant to purchase 11,000 shares of common stock at an exercise price of $15.00 per share for its services in the financing. In addition, we paid $10,000 in legal expenses to the investors’ counsel. We also paid $32,572 to our counsel related to this financing. The net proceeds to us after the placement fee and legal fees were $3,001,428.	Between January 2013 and March 2013, we completed several unit subscription agreements with several accredited investors pursuant to which we issued 151,928 shares of our common stock and 75,964 warrants to purchase our common stock for net cash proceeds of $538,834. Such warrants have an exercise price based upon 120% of the average of the closing prices of our common stock for the five-day period immediately preceding the respective investment transaction date.
	Warrant Exercises and Issuance of New Warrants upon Exercise	A summary of the aggregate warrant activity for the years ended March 31, 2014 and 2013 is presented below:
	During the three months ended December 31, 2014, we issued an aggregate of 113,422 shares of common stock and seven-year warrants to issue up to an aggregate of 113,422 shares of common stock at exercise prices ranging from $4.65 to $5.80 per share to eight accredited investors. One of the investors was Dr. Chetan Shah, one of our directors. We issued the common stock and warrants to the investors upon the cash exercise of previously issued warrants held by them. The investors paid an aggregate of $579,251 upon exercise of the previously outstanding warrants at exercise prices ranging from $4.65 to $5.80 per share.			Year Ended March 31,
				2014								2013
	Warrant Exercises			Warrants				Weighted Average				Warrants				Weighted Average
								Exercise Price								Exercise Price
	During the three months ended December 31, 2014, we issued an aggregate of 430,333 shares of common stock to accredited investors upon the exercise of previously issued warrants. The warrants were exercised on a cashless or “net” basis. Accordingly, we did not receive any proceeds from such exercises. The cashless exercise of such warrants resulted in the cancellation of previously issued warrants to purchase an aggregate of 605,304 shares of common stock.	Outstanding, beginning of year			1,512,946			$	5.5				1,196,157			$	7
		Granted			290,610			$	9				334,209			$	5.5
	Stock Option Exercises	Exercised			(254,324	)		$	4				–			$	–
		Cancelled/Forfeited			(135,042	)		$	5.5				(17,420	)		$	12.5
	During the three months ended December 31, 2014, two former employees exercised stock options to purchase 1,000 common shares through a cash payment of $9,500 with an exercise price of $9.50 per share.	Outstanding, end of year			1,414,190			$	5				1,512,946			$	5.5
		Exercisable, end of year			1,414,190			$	5				1,512,946			$	5.5
		Weighted average estimated fair value of warrants granted						$	4.5							$	3.5
		The following outlines the significant weighted average assumptions used to estimate the fair value of warrants granted utilizing the Binomial Lattice option pricing model:
			Year Ended March 31,
			2014		2013
		Risk free interest rate	1.3%-2.04%		0.86%-1.56%
		Average expected life	5 to 7 years		5 to 7 years
		Expected volatility	91.2% - 98.5%		90.3% - 94.3%
		Expected dividends	None		None
		The detail of the warrants outstanding and exercisable as of March 31, 2014 is as follows:
				Warrants Outstanding												Warrants Exercisable
		Range of		Number				Weighted Average				Weighted Average				Number				Weighted Average
		Exercise Prices		Outstanding				Remaining				Exercise Price				Outstanding				Exercise Price
								Life (Years)
		$5.00 or Below			741,896				2.42			$	2.5				741,896			$	2.5
		$5.50 - $9.50			437,520				4.74			$	6.5				437,520			$	6.5
		$10.00 - $12.50			234,774				5.05			$	10.5				234,774			$	10.5
				1,414,190												1,414,190
	STOCK OPTIONS:
	2000 STOCK OPTION PLAN
	Our 2000 Stock Option Plan (the "Plan"), adopted by us in August 2000, provides for the grant of incentive stock options ("ISOs") to our full-time employees (who may also be directors) and nonstatutory stock options ("NSOs") to non-employee directors, consultants, customers, vendors or providers of significant services. The exercise price of any ISO may not be less than the fair market value of our common stock on the date of grant or, in the case of an optionee who owns more than 10% of the total combined voting power of all classes of our outstanding common stock, not be less than 110% of the fair market value on the date of grant. The exercise price, in the case of any NSO, must not be less than 75% of the fair market value of our common stock on the date of grant. The amount reserved under the Plan is 10,000 options.
	At March 31, 2012, all of the grants previously made under the Plan had expired and 200 restricted shares had been issued under the 2000 Stock Option Plan, with 9,800 available for future issuance.
	2003 CONSULTANT STOCK PLAN
	Our 2003 Consultant Stock Plan, as amended from time to time (the "Stock Plan"), adopted by us in August 2003, advances our interests by helping us obtain and retain the services of persons providing consulting services upon whose judgment, initiative, efforts and/or services we are substantially dependent, by offering to or providing those persons with incentives or inducements affording such persons an opportunity to become owners of our common stock. Over several years, we issued 150,000 shares under the Stock Plan and discontinued using the Stock Plan in October 2012.
	2010 STOCK INCENTIVE PLAN
	In August 2010, we adopted the 2010 Stock Incentive Plan (the "Incentive Plan"), which provides incentives to attract, retain and motivate employees and directors whose present and potential contributions are important to the success of the Company by offering them an opportunity to participate in our future performance through awards of options, the right to purchase common stock, stock bonuses and stock appreciation rights and other awards. A total of 70,000 common shares were initially reserved for issuance under the Incentive Plan.
	In August 2010, we filed a registration statement on Form S-8 for the purpose of registering 70,000 common shares issuable under the Incentive Plan under the Securities Act of 1933 and in July 2012, we filed a registration statement on Form S-8 for the purpose of registering an additional 100,000 common shares issuable under the Incentive Plan under the Securities Act of 1933.
	In May 2013, we issued to a scientific advisory board member and a scientific consultant a three year option to purchase 2,500 shares of our common stock at a price of $5.50 per share.
	At March 31, 2014, we had 48,913 shares available under the Incentive Plan.
	2012 DIRECTORS COMPENSATION PROGRAM
	In July 2012, our Board of Directors approved a new Board Compensation Program (the “New Program”), which modifies and supersedes the 2005 Directors Compensation Program (the “2005 Program”) that was previously in effect. Under the New Program, in which only non-employee Directors may participate, an eligible Director will receive a grant of $35,000 worth of ten year options to acquire shares of our common stock, with such grant being valued at the exercise price based on the average of the closing bid prices of our common stock for the five trading days preceding the first day of the fiscal year. In addition, under the New Program, eligible Directors will receive cash compensation equal to $500 for each committee meeting attended and $1,000 for each formal Board meeting attended.
	In the fiscal year ended March 31, 2013, our Board of Directors granted under the New Program, to our four outside directors, ten year options to acquire an aggregate of 33,342 shares of our common stock, all with an exercise price of $3.80 per share.
	In the fiscal year ended March 31, 2014, our Board of Directors granted under the New Program, to our five outside directors, ten year options to acquire an aggregate of 31,911 shares of our common stock, all with an exercise price of $4.10 per share.
	At March 31, 2014 under the 2005 Program, we had issued 26,757 options to outside directors and 79,309 options to employee-directors. Of such amounts, 10,291 outside directors’ options had been forfeited, 5,000 outside directors’ options had been exercised, and 73,431 options remained outstanding.
	On June 6, 2014, our Board of Directors approved certain changes to the New Program. Under the modified New Program, a new eligible Director will receive an initial grant of $50,000 worth of options to acquire shares of our common stock, with such grant being valued at the exercise price based on the average of the closing bid prices of our common stock for the five trading days preceding the first day of the fiscal year. These options will have a term of ten years and will vest 1/3 upon grant and 1/3 upon each of the first two anniversaries of the date of grant. In addition, at the beginning of each fiscal year, each existing Director eligible to participate in the modified New Program also will receive a grant of $35,000 worth of options valued at the exercise price based on the average of the closing bid prices of our common stock for the five trading days preceding the first day of the fiscal year. Such options will vest on the first anniversary of the date of grant. In lieu of per meeting fees, under the modified New Program eligible Directors will receive an annual Board cash retainer fee of $30,000. The modified New Program also provides for the following annual cash retainer fees: Audit Committee Chair - $5,000, Compensation Committee chair - $5,000, Audit Committee member - $4,000, Compensation Committee member - $4,000, and Lead independent director - $15,000.
	STAND-ALONE GRANTS
	From time to time our Board of Directors grants restricted stock or common share purchase options or warrants to selected directors, officers, employees and consultants as equity compensation to such persons on a stand-alone basis outside of any of our formal stock plans. The terms of these grants are individually negotiated.
	On June 8, 2009, our board of directors approved the grant to Mr. Joyce of 80,000 shares of restricted common stock at a price per share of $12.00, the vesting and issuance of which occurred in equal installments over a thirty-six-month period that commenced on June 30, 2010. Mr. Joyce may, from time to time, defer acceptance of the shares. However, all shares must be issued and accepted by Mr. Joyce by the expiration of the thirty-six-month vesting period. Mr. Joyce has accepted all 80,000 shares of the grant. However, the 12,000 shares previously accepted by Mr. Joyce were pledged as collateral for a loan and have been retained and/or sold by the lender and are no longer owned by Mr. Joyce.
	In July 2013, our compensation committee and Board of Directors approved the issuance of four stock option grants to four of our executives. The options carried an exercise price of $5.00 per share, have a ten year life and vest over the following schedule: 25% on July 1, 2014, 25% on July 1, 2015, 25% on July 1, 2016 and 25% on July 1, 2017. The numbers of shares underlying each of the stock option grants were as follows: 40,000 shares to our chief executive officer and 10,000 shares each to our president, chief science officer and chief financial officer.
	During the three months ended March 31, 2014, a former director exercised 3,659 in vested stock options through the contribution of $2,000 in cash and $13,000 in accrued expenses owed to him based on the exercise price of $4.10 per share.
	As of March 31, 2014, we have issued 451,363 options (of which 67,379 have been exercised or cancelled) and authorized the issuance of 80,000 shares of restricted stock outside of the 2005 Directors Compensation Plan, the 2012 Directors Compensation Plan, the 2000 Stock Option Plan, the 2003 Consultant Stock Plan and the 2010 Incentive Stock Plan.
	In the fiscal year ended March 31, 2014, our Board of Directors granted, to our five outside directors, ten year options to acquire an aggregate of 31,911 shares of our common stock, all with an exercise price of $4.10 per share.
	The following is a summary of the stock options outstanding at March 31, 2014 and 2013 and the changes during the years then ended:
			Year Ended March 31,
			2014								2013
			Options				Weighted Average				Options				Weighted Average
							Exercise Price								Exercise Price
	Outstanding, beginning of year			421,916			$	14				388,574			$	15.5
	Granted			104,411			$	4.5				33,342			$	4
	Exercised			(3,659		)	$	4				–			$	–
	Cancelled/Forfeited			–			$	–				–			$	–
	Outstanding, end of year			522,668			$	12.5				421,916			$	14
	Exercisable, end of year			449,751			$	13.5				382,833			$	14.500.29
	Weighted average estimated fair value of options granted						$	6.5							$	4
	The following outlines the significant weighted average assumptions used to estimate the fair value with respect to stock options utilizing the Binomial Lattice option pricing model for the years ended March 31, 2014 and March 31, 2013:
		Year Ended March 31,
		2014		2013
	Risk free interest rate	0.38% to 2.65%		1.44%
	Average expected life	3 to 10 years		10 years
	Expected volatility	91.05% to 102.67%		117.53%
	Expected dividends	None		None
	The detail of the options outstanding and exercisable as of March 31, 2014 is as follows:
					Options Outstanding												Options Exercisable
	Range of				Number				Weighted				Weighted				Number				Weighted
	Exercise Prices				Outstanding				Average				Average				Outstanding				Average
									Remaining				Exercise								Exercise
									Life (Years)				Price								Price
	$4.00 - $5.50					134,094				9.68 years			$	4.5				64,094			$	4
	$10.50 - $12.50					224,143				4.28 years			$	12				221,226			$	12
	$18.00 - $20.50					164,431				2.68 years			$	19				164,431			$	19
						522,668												449,751
	We recorded stock-based compensation expense related to share issuances and to options granted totaling $607,946 and $765,273 for the fiscal years ended March 31, 2014 and 2013, respectively. These expenses were recorded as stock compensation included in payroll and related expenses in the accompanying consolidated statement of operations for the years ended March 31, 2014 and 2013.
	Our total stock-based compensation for fiscal years ended March 31, 2014 and 2013 included the following:
			31-Mar-14				31-Mar-13
	Vesting of restricted stock grant		$	64,444			$	386,668
	Incremental fair value of option modifications			1,914				23,027
	Vesting of stock options			541,588				355,578
	Total Stock-Based Compensation		$	607,946			$	765,273
	As of March 31, 2014, we had $270,952 of remaining unrecognized stock option expense, which is expected to be recognized over a weighted average remaining vesting period of 2.07 years.
	On March 31, 2014, our stock options had a negative intrinsic value since the closing price on that date of $8.50 per share was below the weighted average exercise price of our stock options.

7_RELATED_PARTY_TRANSACTIONS

7. RELATED PARTY TRANSACTIONS	9 Months Ended	12 Months Ended
	Dec. 31, 2014	Mar. 31, 2014
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	DUE TO RELATED PARTIES	7. RELATED PARTY TRANSACTIONS
	Certain of our officers and other related parties have advanced us funds, agreed to defer compensation and/or paid expenses on our behalf to cover working capital deficiencies. These unsecured and non-interest-bearing liabilities have been included as due to related parties in the accompanying consolidated balance sheets.	DUE TO RELATED PARTIES
	Other related party transactions are disclosed elsewhere in these notes to consolidated financial statements.	Certain of our officers and other related parties have advanced us funds, agreed to defer compensation and/or paid expenses on our behalf to cover working capital deficiencies. These unsecured and non-interest-bearing liabilities have been included as due to related parties in the accompanying consolidated balance sheets.
		Other related party transactions are disclosed elsewhere in these notes to consolidated financial statements.

8_OTHER_CURRENT_LIABILITIES

8. OTHER CURRENT LIABILITIES	9 Months Ended					12 Months Ended
	Dec. 31, 2014					Mar. 31, 2014
Other Liabilities Disclosure [Abstract]
OTHER CURRENT LIABILITIES	Other current liabilities were comprised of the following items:					8. OTHER CURRENT LIABILITIES
		December 31,		March 31,		Other current liabilities were comprised of the following items:
		2014		2014
	Accrued interest	$	56,306	$	1,165,335		March 31,		March 31,
	Accrued legal fees		–		179,465		2014		2013
	Accrued liquidated damages		362,800		362,800	Accrued interest	$	1,165,335	$	1,032,110
	Other accrued liabilities		21,313		147,774	Accrued legal fees		179,465		179,465
	Total other current liabilities	$	440,419	$	1,855,374	Accrued liquidated damages		362,800		437,800
						Other accrued liabilities		147,774		155,610
						Total other current liabilities	$	1,855,374	$	1,804,985

9_FAIR_VALUE_MEASUREMENTS

9. FAIR VALUE MEASUREMENTS

9 Months Ended

12 Months Ended

Dec. 31, 2014

Mar. 31, 2014

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

We follow FASB ASC 820, “Fair value measurements and disclosures” (“ASC 820”) in connection with assets and liabilities measured at fair value on a recurring basis subsequent to initial recognition. The guidance applies to our derivative liabilities. We had no assets or liabilities measured at fair value on a non-recurring basis for any period reported.

10. FAIR VALUE MEASUREMENTS

ASC 820 requires that assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories: We measure the fair value of applicable financial and non-financial assets based on the following fair value hierarchy:

We follow FASB ASC 820, "FAIR VALUE MEASUREMENTS AND DISCLOSURES" (“ASC 820”) in connection with financial assets and liabilities measured at fair value on a recurring basis subsequent to initial recognition.

Level 1: Quoted market prices in active markets for identical assets or liabilities.

ASC 820 requires that assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 1: Quoted market prices in active markets for identical assets or liabilities.

Level 3: Unobservable inputs that are not corroborated by market data.

Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.

The hierarchy noted above requires us to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value.

Level 3: Unobservable inputs that are not corroborated by market data.

The fair value of our recorded derivative liabilities is determined based on unobservable inputs that are not corroborated by market data, which is a Level 3 classification. We record derivative liabilities on our balance sheet at fair value with changes in fair value recorded in our consolidated statements of operations.

The hierarchy noted above requires us to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value.

At December 31, 2014, we no longer had any derivative liabilities as all of the holders of the financial instruments that had price antidilution protection waived such price antidilution protection.

The fair value of our recorded derivative liabilities is determined based on unobservable inputs that are not corroborated by market data, which is a Level 3 classification. We record derivative liabilities on our balance sheet at fair value with changes in fair value recorded in our consolidated statements of operations.  Our fair value measurements at the reporting date were as follows:

Our fair value measurements at the March 31, 2014 reporting date are classified based on the valuation technique level noted in the table below:

At March 31, 2014:

Description

Quoted Prices in

Significant Other

Significant

Description

March 31,

Quoted Prices

Significant

Significant

Active Markets for

Observable Inputs

Unobservable

2014

in Active

Other

Unobservable

Identical Assets

(Level 2)

Inputs (Level 3)

Markets for

Observable

(Level 3)

(Level 1)

(Level 1)

(Level 2)

Derivative Liabilities

$

–

$

–

$

10,679,067

Derivative Liabilities

$

10,679,067

$

–

$

–

$

10,679,067

Total Assets

$

–

$

–

$

10,679,067

Total Assets

$

10,679,067

$

–

$

–

$

10,679,067

At March 31, 2013:

The following outlines the significant weighted average assumptions used to estimate the fair value information presented, in connection with our warrant and embedded conversion option derivative instruments utilizing the Binomial Lattice option pricing model:

Description

Quoted Prices in

Significant Other

Significant

Active Markets for

Observable Inputs

Unobservable

Nine Months Ended December 31, 2013

Identical Assets

(Level 2)

Inputs (Level 3)

Risk free interest rate

0.02% - 2.04%

(Level 1)

Average expected life

0.25 – 3 years

Derivative Liabilities

$

–

$

–

$

3,588,239

Expected volatility

58.0% - 103.1%

Total Assets

$

–

$

–

$

3,588,239

Expected dividends

None

The following outlines the significant weighted average assumptions used to estimate the fair value information presented for the fiscal years ended March 31, 2014 and 2013, in connection with our April 2011 convertible note, July & August 2011 10% convertible notes and the September 2011 convertible note offerings and with respect to warrant and embedded conversion option derivative instruments utilizing the Binomial Lattice option pricing model:

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the nine months ended December 31, 2014:

Fiscal Year Ended March 31, 2014

April 1,

Recorded New

Change in

Reclassification

December 31,

Risk free interest rate

0.02% - 0.79%

2014

Derivative

estimated

of Derivative

2014

Average expected life

0.25 – 2.8 years

Liabilities

fair value

Liability to Paid

Expected volatility

58.0% - 103.1%

recognized in

in capital

Expected dividends

None

results of

operations

Fiscal Year Ended March 31, 2013

Risk free interest rate

0.05% - 1.56%

Derivative liabilities

$

10,679,067

$

–

$

–

$

(10,679,067

)

$

–

Average expected life

0.25 – 3.6 years

Expected volatility

76.0% - 107.1%

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the nine months ended December 31, 2013:

Expected dividends

None

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the year ended March 31, 2014:

April 1,

Recorded New Derivative

Change in

Reclassification

December 31,

2013

Liabilities

estimated

of Derivative

2013

April 1,

Recorded New Derivative Liabilities

Change in estimated fair value recognized in results of operations

Reclassification of Derivative Liability to Paid in capital

March 31,

fair value

Liability to Paid

2013

2014

recognized in

in capital

results of

Derivative liabilities

$

3,588,239

$

–

$

5,729,780

$

1,361,048

$

10,679,067

operations

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the year ended March 31, 2013:

Derivative liabilities

$

3,588,239

$

–

$

2,304,702

$

(316,876

)

$

5,576,065

April 1,

Recorded New Derivative Liabilities

Change in estimated fair value recognized in results of operations

Reclassification of Derivative Liability to Paid in capital

March 31,

2012

2013

Derivative liabilities

$

3,588,615

$

–

$

(44,705

)

$

44,329

$

3,588,239

10_STOCK_COMPENSATION

10. STOCK COMPENSATION	9 Months Ended
	Dec. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
STOCK COMPENSATION	The following table breaks out the components of our share-based compensation expenses relating to shares and options granted and the effect on basic and diluted loss per common share during the three and nine months ended December 31, 2014 and 2013.
			Three Months Ended			Three Months Ended			Nine Months Ended			Nine Months Ended
			31-Dec-14			31-Dec-13			31-Dec-14			31-Dec-13
	Vesting of stock options			77,900			32,750			338,580			156,993
	Incremental fair value of option modifications			–			–			–			1,914
	Vesting expense associated with CEO restricted stock grant			–			–			–			64,444
	Total share-based compensation expense		$	77,900		$	32,750		$	338,580		$	223,351
	Total share-based compensation expense included in net loss		$	77,900		$	32,750		$	338,580		$	223,351
	Weighted average number of common shares outstanding – basic and diluted			6,032,126			3,963,066			5,254,459			3,750,111
	Basic and diluted loss per common share associated with stock-based compensation expense		$	(0.01	)	$	(0.01	)	$	(0.06	)	$	(0.06	)
	All of the stock-based compensation expense recorded during the nine months ended December 31, 2014 and 2013, which totaled $338,580 and $223,351, respectively, is included in payroll and related expense in the accompanying condensed consolidated statements of operations.  Stock-based compensation expense recorded during the nine months ended December 31, 2014 and 2013 had an impact on basic and diluted loss per common share of $(0.06).
	We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The cumulative effect of adjusting the forfeiture rate for all expense amortization is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the three and nine month periods ended December 31, 2014 was insignificant.
	On June 6, 2014, our Board of Directors approved the following grants of options to certain officers and directors of the Company:
		o	To Mr. James A. Joyce, an option to acquire an aggregate of 30,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The fair value of this stock option at the date of grant was $246,000.  The option vested as to 10,000 shares on the grant date for a vesting expense of $82,000 and will vest as to an additional 10,000 shares on each of the first two anniversaries of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
		o	To Mr. Rodney S. Kenley, an option to acquire an aggregate of 5,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The fair value of this stock option at the date of grant was $41,000.  The option vested as to 1,666 shares on the grant date for a vesting expense of $13,667 and will vest as to an additional 1,666 shares on the first anniversary of the grant date and 1,667 shares on the second anniversary of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
		o	To Mr. James B. Frakes, an option to acquire an aggregate of 5,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The fair value of this stock option at the date of grant was $41,000. The option vested as to 1,666 shares on the grant date for a vesting expense of $13,667 and will vest as to an additional 1,666 shares on the first anniversary of the grant date and 1,667 shares on the second anniversary of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
		o	To Dr. Richard H. Tullis, an option to acquire an aggregate of 1,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The fair value of this stock option at the date of grant was $8,200. The option vested as to 333 shares on the grant date for a vesting expense of $2,733 and will vest as to an additional 333 shares on the first anniversary of the grant date and 334 shares on the second anniversary of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
	In addition to the above grants to our officers, on June 6, 2014, our Board of Directors also approved the grant of options to five employees to acquire an aggregate of 7,400 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The aggregate fair value of those stock options at the date of grant was $60,680. Those options vested as to 2,466 shares on the grant date for a vesting expense of $20,227 and will vest as to an additional 2,466 shares on the first anniversary of the grant date and 2,467 shares on the second anniversary of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
	In addition to the share-based compensation expense for the specific stock option grants noted above, our total share-based compensation expense for the three and nine months ended December 31, 2014 includes ongoing vesting expense associated with stock grants from prior periods.
	Changes to 2012 Board Compensation Program
	In July 2012, the Board approved a Board Compensation Program (the “2012 Program”), which modified and superseded the 2005 Directors Compensation Program that had been in effect previously. On June 6, 2014, the Board approved certain changes to the 2012 Program. Under the modified 2012 Program, in which only non-employee Directors may participate, a new eligible Director will receive an initial grant of $50,000 worth of options to acquire shares of common stock, with such grant being valued at the exercise price based on the average of the closing bid prices of our common stock for the five trading days preceding the first day of the fiscal year. These options will have a term of ten years and will vest 1/3 upon grant and 1/3 upon each of the first two anniversaries of the date of grant.
	At the beginning of each fiscal year, each existing Director eligible to participate in the 2012 Program also will receive a grant of $35,000 worth of options valued at the exercise price based on the average of the closing bid prices of the Common Stock for the five trading days preceding the first day of the fiscal year. Such options will vest on the first anniversary of the date of grant. In lieu of per meeting fees, under the 2012 Program eligible Directors will receive an annual Board retainer fee of $30,000. The modified 2012 Program also provides for the following annual retainer fees: Audit Committee Chair - $5,000, Compensation Committee chair - $5,000, Audit Committee member - $4,000, Compensation Committee member - $4,000 and Lead independent director - $15,000.
	As a result of the modified 2012 Program on June 6, 2014, we issued 3,684 stock options to each of our three outside directors. Those grants vest over the fiscal year ending March 31, 2015 and have an exercise price of $9.50 per share.
	All of the foregoing actions - the changes in base salaries, the option grants and the changes to the Directors Compensation Program discussed herein - were approved and recommended by the Company’s Compensation Committee prior to approval by the Board.
	The following outlines the significant weighted average assumptions used to estimate the fair value information presented, with respect to stock option grants utilizing the Binomial Lattice option pricing models at, and during the nine months ended December 31, 2014:
	Risk free interest rate	2.60%
	Average expected life	10 years
	Expected volatility	90.23%
	Expected dividends	None
	The expected volatility was based on the historic volatility. The expected life of options granted was based on the "simplified method" as described in the Securities and Exchange Commission's guidance due to changes in the vesting terms and contractual life of current option grants compared to our historical grants.
	In May 2013, we granted to a scientific advisory board member and a scientific consultant a three year option to purchase 2,500 shares of our common stock at a price of $5.50 per share.
	In July 2013, our compensation committee and Board of Directors approved the issuance of four stock option grants to four of our executives. The options carried an exercise price of $5.00 per share, have a ten year life and vest over the following schedule: 25% on July 1, 2014, 25% on July 1, 2015, 25% on July 1, 2016 and 25% on July 1, 2017. The numbers of shares underlying each of the stock option grants were as follows: 40,000 shares to our chief executive officer and 10,000 shares each to our president, chief science officer and chief financial officer (see Note 10).
	The following outlines the significant weighted average assumptions used to estimate the fair value information, which is based on historical data, with respect to stock option grants utilizing the Binomial Lattice option pricing models at, and during the nine months ended December 31, 2013:
	Risk free interest rate	0.38% - 2.50%
	Average expected life	3 years - 10 years
	Expected volatility	94.6% - 102.7%
	Expected dividends	None
	The expected volatility was based on the historic volatility. The expected life of options granted was based on the "simplified method" as described in the Securities and Exchange Commission's guidance due to changes in the vesting terms and contractual life of current option grants compared to our historical grants.
	Options outstanding that have vested and are expected to vest as of December 31, 2014 are as follows:
			Number of Options			Weighted Average Exercise Price			Weighted Average Remaining Contractual Term in Years
	Vested			485,301		$	13			4.24
	Expected to vest			93,819		$	7			8.9
	Total			579,121
	A summary of stock option activity during the nine months ended December 31, 2014 is presented below:
			Number of Options			Range of			Weighted Average
						Exercise Price			Exercise Price
	Stock options outstanding at March 31, 2014			522,668			$3.80 - $20.50		$	12.5
	Exercised			(1,000	)		9.5		$	9.5
	Granted			59,453			9.5		$	9.5
	Cancelled/Expired			(2,000	)		9.5		$	9.5
	Stock options outstanding at December 31, 2014			579,121			$3.80 - $20.50		$	12
	Stock options exercisable at December 31, 2014			485,301			$3.80 - $20.50		$	13
	At December 31, 2014, there was approximately $419,883 of unrecognized compensation cost related to share-based payments, which is expected to be recognized over a weighted average period of 1.35 years.
	The aggregate intrinsic value of the stock options outstanding as of December 31, 2014 was $868,681, which represents the value of our closing stock price on the last trading day of the period, which was $13.50, in excess of the weighted-average exercise price of $12.00, multiplied by the number of options outstanding.

11_WARRANTS

11. WARRANTS	9 Months Ended
	Dec. 31, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract]
WARRANTS	A summary of warrant activity during the nine months ended December 31, 2014 is presented below:
			Amount			Range of		Weighted Average
						Exercise Price		Exercise Price
	Warrants outstanding at March 31, 2014			1,414,190			$2.10 - $12.50	$	6.5
	Exercised			(587,084	)		$2.10 – $11.00	$	4.5
	Issued			806,478			$2.10 - $15.00	$	8.5
	Cancelled/Expired			(197,692	)		$2.10 - $11.00	$	7.00
	Warrants outstanding at December 31, 2014			1,435,892			$2.10 - $15.00	$	7
	Warrants exercisable at December 31, 2014			1,435,892			$2.10 - $15.00	$	7
	The following outlines the significant weighted average assumptions used to estimate the fair value information presented, with respect to warrants utilizing the Binomial Lattice option pricing models at, and during, the nine months ended December 31, 2014:
	Risk free interest rate	0.79% - 2.29%
	Average expected life	5 years – 7 years
	Expected volatility	87.8% - 107.4%
	Expected dividends	None

12_DARPA_CONTRACT_AND_RELATED_

12. DARPA CONTRACT AND RELATED REVENUE RECOGNITION	9 Months Ended	12 Months Ended
	Dec. 31, 2014	Mar. 31, 2014
Revenue Recognition [Abstract]
DARPA CONTRACT AND RELATED REVENUE RECOGNITION	As discussed in Note 1, we entered into a contract with the Defense Advanced Research Projects Agency (DARPA) on September 30, 2011. Under the DARPA award, we have been engaged to develop a therapeutic device to reduce the incidence of sepsis, a fatal bloodstream infection that often results in the death of combat-injured soldiers. The award from DARPA was a fixed-price contract with potential total payments to us of $6,794,389 over the course of five years. Fixed price contracts require the achievement of multiple, incremental milestones to receive the full award during each year of the contract. Under the terms of the contract, we will perform certain incremental work towards the achievement of specific milestones against which we will invoice the government for fixed payment amounts.	11. DARPA CONTRACT AND RELATED REVENUE RECOGNITION
	Originally, only the base year (year one of the contract) was effective for the parties, however, DARPA subsequently exercised the option on the second, third and fourth years of the contract. DARPA has the option to enter into the contract for year five. The milestones are comprised of planning, engineering and clinical targets, the achievement of which in some cases will require the participation and contribution of third party participants under the contract. There can be no assurance that we alone, or with third party participants, will meet such milestones to the satisfaction of the government and in compliance with the terms of the contract or that we will be paid the full amount of the contract revenues during any year of the contract term. We commenced work under the contract in October 2011.	As discussed in Note 1, we entered into a contract with the DARPA on September 30, 2011. Under the DARPA award, we have been engaged to develop a therapeutic device to reduce the incidence of sepsis, a fatal bloodstream infection that often results in the death of combat-injured soldiers. The award from DARPA was a fixed-price contract with potential total payments to us of $6,794,389 over the course of five years. Fixed price contracts require the achievement of multiple, incremental milestones to receive the full award during each year of the contract. Under the terms of the contract, we will perform certain incremental work towards the achievement of specific milestones against which we will invoice the government for fixed payment amounts.
	In February 2014, DARPA reduced the scope of our contract in years three through five of the contract. The reduction in scope focused our research on exosomes, viruses and blood processing instrumentation. This scope reduction will reduce the possible payments under the contract by $858,469 over years three through five. We recently completed a re-budgeting of the expected costs on the remaining years of the DARPA contract based on the reduced milestones and have concluded that the reductions in our costs due to the scaled back level of work will almost entirely offset the anticipated revenue levels based on current assumptions.	Originally, only the base year (year one of the contract) was effective for the parties, however, DARPA subsequently exercised the option on the second and third years of the contract. DARPA has the option to enter into the contract for years four and five. The milestones are comprised of planning, engineering and clinical targets, the achievement of which in some cases will require the participation and contribution of third party participants under the contract. There can be no assurance that we alone, or with third party participants, will meet such milestones to the satisfaction of the government and in compliance with the terms of the contract or that we will be paid the full amount of the contract revenues during any year of the contract term. We commenced work under the contract in October 2011.
	During the nine months ended December 31, 2014, we invoiced DARPA for three milestones totaling $444,723. The details of those milestones were as follows:	In February 2014, DARPA reduced the scope of our contract in years three through five of the contract. The reduction in scope focused our research on exosomes, viruses and blood processing instrumentation. This scope reduction will reduce the possible payments under the contract by $858,469 over years three through five. We recently completed a rebudgeting of the expected costs on the remaining years of the DARPA contract based on the reduced milestones and have concluded that the reductions in our costs due to the scaled back level of work will almost entirely offset the anticipated revenue levels based on current assumptions.
	Milestone 2.4.2.2 – Determine capacity requirements of affinity resin to multiple simultaneous targets. The milestone payment was $197,362. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to determine the capacity requirements of affinity resin to multiple simultaneous targets. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	Fiscal Year Ended March 31, 2014
	Milestone 2.4.2.4 – Finish construction and delivery of 25 experimental cartridges for testing by the system integrator. The milestone payment was $50,000. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.  We demonstrated that we delivered the 25 cartridges to the systems integrator as part of our submission for approval. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	As a result of achieving eight milestones in the fiscal year ended March 31, 2014, we reported $1,466,482 in contract revenue for that fiscal year. The details of the eight milestones achieved during the fiscal year ended March 31, 2014 were as follows:
	Milestone M9 – Target capture > 90% in 24 hours for at least 3 targets ex vivo in blood or blood components using the optimized cartridge. The milestone payment was $197,361. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to capture approximately 90% in 24 hours for at least 3f targets ex vivo in blood or blood components using the optimized cartridge. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	Milestone 2.3.2.2 – Formulate initial design work based on work from the previous phase. Begin to build and test selected instrument design and tubing sets. The milestone payment was $195,581. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to formulate the initial design work and to build and test selected instrument design and tubing sets as part of our submission for approval. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
	In the nine months ended December 31, 2013, we invoiced DARPA for four milestones totaling $808,739. The details of those milestones were as follows:	Milestone 2.3.2.2 – Write and test software and conduct ergonomic research. Begin discussions with the systems integrator. The milestone payment was $195,581. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We obtained wrote and tested software and conducted ergonomic research and began discussions with the systems integrator. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
	Milestone 2.3.2.2 – Formulate initial design work based on work from the previous phase. Begin to build and test selected instrument design and tubing sets. The milestone payment was $195,581. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to formulate the initial design work and to build and test selected instrument design and tubing sets as part of our submission for approval. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	Milestone 2.3.3.2 – Cartridge construction with optimized affinity matrix design for each potential target. Complete the capture agent screening. The milestone payment was $208,781. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We completed the cartridge construction with optimized affinity matrix design for each potential target and completed the capture agent screening. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
	Milestone 2.3.2.2 – Write and test software and conduct ergonomic research. Begin discussions with the systems integrator. The milestone payment was $195,581. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We obtained wrote and tested software and conducted ergonomic research and began discussions with the systems integrator. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	Milestone M5 – Target capture > 90% in 24 hours for at least three targets in blood or blood components. The milestone payment was $208,781. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to capture > 90% in 24 hours for at least three of the agreed targets in blood or blood components. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
	Milestone 2.3.3.2 – Cartridge construction with optimized affinity matrix design for each potential target. Complete the capture agent screening. The milestone payment was $208,781. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We completed the cartridge construction with optimized affinity matrix design for each potential target and completed the capture agent screening. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	Milestone M3 – Conduct a series of experiments aimed at characterizing the contribution of several alternate fluidic designs and methods of perfusing plasma filters and affinity columns in the performance of affinity plasmapheresis. The milestone payment was $195,576. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we had conducted the relevant series of experiments. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
	Milestone M5 – Target capture > 90% in 24 hours for at least three targets in blood or blood components. The milestone payment was $208,781. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to capture approximately 90% in 24 hours for at least three of the agreed targets in blood or blood components. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.	Milestone 2.4.2.1 – Evaluate contribution of manufacturing process variables to binding capacity of affinity resin. The milestone payment was $197,362. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we had evaluated the contribution of manufacturing process variables to binding capacity of affinity resin. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone 2.4.1.1 – Design and fabricate optimized configuration(s) of hemopurification device(s) that contain(s) a combination of hemofilters, plasma filters and affinity columns. The milestone payment was $186,164. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we had designed and fabricated optimized configuration of hemopurification devices. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone 2.4.2.3 – Perform biocompatibility tests for the combination ADAPT device to confirm the combination cartridge does not present additional risk. The milestone payment was $78,641. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we had performed biocompatibility tests for the combination ADAPT device to confirm the combination cartridge does not present additional risk. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Fiscal Year Ended March 31, 2013
		As a result of achieving six milestones in the fiscal year ended March 31, 2013, we reported $1,230,004 in contract revenue for that fiscal year. The details of the six milestones achieved during the fiscal year ended March 31, 2013 were as follows:
		Milestone 2.2.2.3 – Perform preliminary quantitative real time PCR to measure viral load, and specific DNA or RNA targets. The milestone payment was $216,747. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts. We demonstrated that we were able to measure viral load of one or more targets as part of our submission for approval.  The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone 2.2.1.4 – Obtain all necessary IRB documentation and obtain both institutional and Government approval in accordance with IRB documentation submission guidance prior to conducting human or animal testing. The milestone payment was $183,367. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.  We obtained all of the required documentation from both institutional and Government authorities. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone M2 – Target capture > 50% in 24 hours for at least one target in blood or blood components. The milestone payment was $216,747. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.  We demonstrated that we were able to capture > 50% in 24 hours of one of the agreed targets in blood or blood components. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone 2.3.3.1 – Build the ADAPT capture cartridges with the identified affinity agents. Measure the rate of capture of the specific targets from in ex vivo recirculation experiments from cell culture and blood. The milestone payment was $208,781. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.  We demonstrated that we were able build the ADAPT capture cartridges with the identified affinity agents and to measure the rate of capture of the specific targets from in ex vivo recirculation experiments from cell culture and blood. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone 2.3.2.1 – Demonstrate the effectiveness of the prototype device in vivo in animals preventing platelet activation or clotting in at least a 2 hour blood pumping experiment at 75 mL/min blood flow. The milestone payment amount was $195,581. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.  The prototype device was successfully used in vivo in animals preventing platelet activation or clotting in at least a 2 hour blood pumping experiment at 75 mL/min blood flow. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.
		Milestone M4 – Target capture > 50% in 24 hours for at least 5 targets in blood or blood components. The milestone payment was $208,781. Management considers this milestone to be substantive as it was not dependent on the passage of time nor was it based solely on another party's efforts.  We demonstrated that we were able to capture > 50% in 24 hours for at least 5 of the agreed targets in blood or blood components. The report was accepted by the contracting officer's representative and the invoice was submitted thereafter.

13_COMMITMENTS_AND_CONTINGENCI

13. COMMITMENTS AND CONTINGENCIES	9 Months Ended	12 Months Ended
	Dec. 31, 2014	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	LEASE COMMITMENTS	13. COMMITMENTS AND CONTINGENCIES
	We rented approximately 2,300 square feet of executive office space at 8910 University Center Lane, Suite 660, San Diego, CA 92122 at the rate of $6,475 per month on a four year lease that expired in September 2014. We continued leasing that space for the month of October and, effective November 1, 2014, moved into a new facility of approximately 2,576 square feet located at 9635 Granite Ridge Drive, San Diego, CA 92123 under a 39 month lease with an initial rental rate of $6,054 per month. We believe this new leased facility will be satisfactory for our office needs over the term of the lease.	EMPLOYMENT CONTRACTS
	We also rent approximately 1,700 square feet of laboratory space at 11585 Sorrento Valley Road, Suite 109, San Diego, California 92121 at the rate of $3,917 per month on a one year lease that previously was scheduled to expire in October 2014 and was recently extended to in October 2015. We believe this new leased facility will be satisfactory for our laboratory needs over the term of the lease	We entered into an employment agreement with our Chairman of the Board (“Chairman”) effective April 1, 1999. The agreement, which is cancelable by either party upon sixty days’ notice, will be in effect until the Chairman retires or ceases to be employed by us. Under the terms of the agreement, if the Chairman is terminated he may become eligible to receive a salary continuation payment in the amount of at least twelve months' base salary, which was increased to $350,000 per year in June 2014.
	Our Exosome Sciences, Inc. subsidiary rents approximately 2,055 square feet of office and laboratory space at 11 Deer Park Drive, South Brunswick, NJ at the rate of $3,596 per month on a one year lease that previously was scheduled to expire in October 2014 and was recently extended to in October 2015. We believe this new leased facility will be satisfactory for Exosome Sciences, Inc.’s operational needs over the term of the lease.	We entered into an employment agreement with Dr. Tullis (“Tullis”) effective January 10, 2000 as our Chief Science Officer ("CSO"). Under the terms of the agreement, if Tullis is terminated he may become eligible to receive a salary continuation payment in the amount of twelve months base salary, which is $195,000 per year.
	Rent expense approximated $127,000 and $99,000 for the nine month periods ended December 31, 2014 and 2013, respectively.	LEASE COMMITMENTS
	LEGAL MATTERS	We currently rent approximately 2,300 square feet of executive office space at 8910 University Center Lane, Suite 660, San Diego, CA 92122 at the rate of $6,475 per month on a four year lease that expires in September 2014. We also rent approximately 1,700 square feet of laboratory space at 11585 Sorrento Valley Road, Suite 109, San Diego, California 92121 at the rate of $2,917 per month on a two year lease that expires in October 2014.  We are currently searching for new space in the greater San Diego area.
	From time to time, claims are made against us in the ordinary course of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more products or engaging in other activities.	Our Exosome Sciences, Inc. subsidiary rents approximately 2,055 square feet of office and laboratory space at 11 Deer Park Drive, South Brunswick, NJ at the rate of $3,425 per month on a one year lease that expires in October 2014. Our current plans are to renew the lease prior to expiration.
	The occurrence of an unfavorable outcome in any specific period could have a material adverse effect on our results of operations for that period or future periods. We are not presently a party to any pending or threatened legal proceedings.	Rent expense approximated $163,000 and $123,000 for the fiscal years ended March 31, 2014 and 2013, respectively. As of March 31, 2014, commitments under the lease agreements are as follows:
			2015
		8910 University Center Lane, Suite 660, San Diego, CA 92122 office lease	$	43,795
		11585 Sorrento Valley Road, Suite 109, San Diego, California 92121 office lease		22,755
		11 Deer Park Drive, South Brunswick, NJ		23,975
		Total Lease Commitments	$	90,525
		LEGAL MATTERS
		From time to time, claims are made against us in the ordinary course of business, which could result in litigation. Claims and associated litigation are subject to inherent uncertainties and unfavorable outcomes could occur, such as monetary damages, fines, penalties or injunctions prohibiting us from selling one or more products or engaging in other activities.
		The occurrence of an unfavorable outcome in any specific period could have a material adverse effect on our results of operations for that period or future periods. Other than as mentioned here, we are not presently a party to any pending or threatened legal proceedings.
		On February 24, 2014, we entered into a Settlement Agreement and General Release (the “Settlement Agreement”) with Gemini Master Fund, Ltd., a Cayman Islands company ("Gemini"), which, among other things, resulted in the dismissal with prejudice of the complaint filed by Gemini against us on July 5, 2012 in the Supreme Court of the State of New York, County of New York, entitled Gemini Master Fund Ltd. v. Aethlon Medical, Inc., Index No. 652358/2012 (the "Complaint").
		In the Complaint, Gemini sought relief both in the form of money damages and delivery of shares of our common stock. The Complaint alleged, among other things, that we were in default of a convertible promissory note ("Convertible Note") originally issued to Gemini on February 12, 2010 by failing to pay the Convertible Note in full and by failing to honor certain requests by Gemini to convert the principal and interest under the Convertible Note into shares of our common stock. The Complaint also alleged that we failed to issue shares upon the presentation of exercise notices under warrants originally issued to Gemini in 2009 and 2010 (respectively, the "2009 Warrant" and the "2010 Warrant").
		In the Complaint, Gemini alleged it was entitled to 447,788 shares of common stock upon conversion of the balance of the Convertible Note and Gemini alleged that it was entitled to receive 607,416 shares of common stock pursuant to the 2009 Warrant and the 2010 Warrant, for a combined sum of 1,055,204 common shares.
		In response, we provided documentation that the Convertible Note had been paid in full in cash and accepted by Gemini prior to the filing of the Complaint. In addition, we had maintained on our books the total number of shares required to be issued under the 2009 Warrant, the 2010 Warrant and the 2008 Warrant (defined below) combined was 127,200 shares.
		The Settlement Agreement required us to issue a total of 150,457 shares of common stock into an escrow and those shares were to be released to Gemini ratably over a ten-month period. The shares were issued upon partial exercise of the 2009 Warrant and 2010 Warrant as well as under a third warrant, issued by us to Gemini in 2008 (the "2008 Warrant"). No shares were issued as consideration for the alleged default under the Convertible Note or in consideration of the releases granted in the Settlement Agreement. In addition, our insurance company paid Gemini $150,000 in cash. Upon the completion of the share issuances, the 2008 Warrant, the 2009 Warrant and the 2010 Warrants were canceled. In addition, under the Settlement Agreement, the Convertible Note (and any other agreement to pay Gemini or issue stock or anything else of value to Gemini) was extinguished and fully satisfied.
		As we previously had 127,200 shares of common stock reserved for issuance under the three Warrants described above, the settlement increased our fully diluted shares outstanding by 23,257 shares.
		Following the performance of the settlement terms described above, a Stipulation of Dismissal was filed with the Court, permanently terminating the litigation. The Settlement Agreement also provided for mutual and full releases of all other claims between Gemini and us.
		The Company accrued an estimate of $1,000,000 for such matter at December 31, 2013 and expensed such amount during the quarter ended December 31, 2013. Upon final settlement, management determined that the expense was approximately $583,000. Accordingly, during the fourth quarter of the year ended March 31, 2014, the Company recorded a credit to expense of approximately $417,000 related to this matter.

14_SEGMENTS

14. SEGMENTS	9 Months Ended							12 Months Ended
	Dec. 31, 2014							Mar. 31, 2014
Segment Reporting [Abstract]
SEGMENTS	We operate our businesses principally through two reportable segments: Aethlon, which represents our therapeutic business activities, and Exosome Sciences, Inc., which represents our diagnostic business activities. Our reportable segments have been determined based on the nature of the potential products being developed.							14. SEGMENTS
	Aethlon’s revenue is generated primarily from government contracts to date and Exosome Sciences, Inc. does not yet have any revenues. We have not included any allocation of corporate overhead to the Exosome Sciences, Inc. segment.							We operate our businesses principally through two reportable segments: Aethlon, which represents our therapeutic business activities, and ESI, which represents our diagnostic business activities. Our reportable segments have been determined based on the nature of the potential products being developed. ESI did not have any operations in the fiscal year ended March 31, 2013.
	The following tables set forth certain information regarding our segments and other operations that conforms to the consolidated balance sheet and statement of operations presented in this Report:							Aethlon’s revenue is generated primarily from government contracts to date and ESI does not yet have any revenues. We have not included any allocation of corporate overhead to the ESI segment.
		Nine Months Ended						The following tables set forth certain information regarding our segments and other operations that conforms to the consolidated balance sheet and statement of operations presented in this Report:
		December 31,
		2014			2013				Fiscal Years Ended March 31,
	Revenues:								2014			2013
	Aethlon	$	563,805		$	916,796		Revenues:
	Exosome Sciences, Inc.		–			–		Aethlon	$	1,623,769		$	1,230,004
	Total Revenues	$	563,805		$	916,796		ESI		–			–
								Total Revenues	$	1,623,769		$	1,230,004
	Operating Losses:
	Aethlon	$	(2,156,769	)	$	(2,065,212	)	Operating Losses:
	Exosome Sciences, Inc.		(703,411	)		(180,722	)	Aethlon	$	(2,651,863	)	$	(3,575,354	)
	Total Operating Loss	$	(2,860,180	)	$	(2,245,934	)	ESI		(404,065	)		–
								Total Operating Loss	$	(3,055,928	)	$	(3,575,354	)
	Net Losses:
	Aethlon	$	(5,347,716	)	$	(5,735,474	)	Net Losses:
	Exosome Sciences, Inc.		(703,411	)		(185,305	)	Aethlon	$	(13,357,232	)	$	(4,892,040	)
	Net Loss Before Non-Controlling Interests	$	(6,051,127	)	$	(5,920,779	)	ESI		(81,730	)		–
								Net Loss Before Non-Controlling Interests	$	(13,438,962	)	$	(4,892,040	)
	Cash:
	Aethlon	$	2,446,820		$	588,066		Cash:
	Exosome Sciences, Inc.		328,915			1,266,875		Aethlon	$	208,259		$	125,274
	Total Cash	$	2,775,735		$	1,854,941		ESI		1,042,020			–
								Total Cash	$	1,250,279		$	125,274
	Total Assets:
	Aethlon	$	2,735,913		$	777,004		Total Assets:
	Exosome Sciences, Inc.		420,582			1,328,004		Aethlon	$	597,026		$	496,694
	Total Assets	$	3,156,495		$	2,105,008		ESI		1,098,076			–
								Total Assets	$	1,695,102		$	496,694
	Capital Expenditures:
	Aethlon	$	–		$	2,750		Capital Expenditures:
	Exosome Sciences, Inc.		–			58,743		Aethlon	$	37,313		$	–
	Capital Expenditures	$	–		$	61,493		ESI		58,743			–
								Capital Expenditures	$	96,056		$	–
	Depreciation and Amortization:
	Aethlon	$	13,328		$	7,195		Depreciation and Amortization:
	Exosome Sciences, Inc.		14,686			6,964		Aethlon	$	11,549		$	10,484
	Total Depreciation and Amortization	$	28,014		$	14,159		ESI		9,538			–
								Total Depreciation and Amortization	$	21,087		$	10,484
	Interest Expense:
	Aethlon	$	285,229		$	325,364		Interest Expense:
	Exosome Sciences, Inc.		–			4,583		Aethlon	$	1,282,638		$	1,132,314
	Total Interest Expense	$	285,229		$	329,947		ESI		4,583			–
								Total Interest Expense	$	1,287,221		$	1,132,314

15_SUBSEQUENT_EVENTS

15. SUBSEQUENT EVENTS	9 Months Ended	12 Months Ended
	Dec. 31, 2014	Mar. 31, 2014
Segment Reporting [Abstract]
SUBSEQUENT EVENTS	Management has evaluated events subsequent to December 31, 2014 through the date that the accompanying condensed consolidated financial statements were filed with the Securities and Exchange Commission for transactions and other events which may require adjustment of and/or disclosure in such financial statements.	15. SUBSEQUENT EVENTS (UNAUDITED)
	Government Contracts	Management has evaluated events subsequent to March 31, 2014 through the date that the accompanying consolidated financial statements were filed with the Securities and Exchange Commission for transactions and other events which may require adjustment of and/or disclosure in such financial statements.
	Subsequent to December 31, 2014, we billed $8,207 and we collected $12,290 under the Battelle Memorial Institute subcontract.	Government Contracts
	Debt Reduction	Subsequent to March 31, 2014, we billed $197,362 under our DARPA contract and billed $62,696 under the Battelle subcontract and we collected $135,376 under both contracts.
	Subsequent to December 31, 2014, we paid off the remaining principal and interest balances on the two remaining 12% Notes with cash payments totaling $68,063 (see Note 5).	Common Stock Issuances
	Note Conversions	Subsequent to March 31, 2014, we issued 4,383 shares of common stock pursuant to our S-8 registration statement covering our Amended 2010 Stock Plan at an average price of $8.73 per share in payment for internal controls, legal and scientific consulting services valued at $38,268 based on the value of the services provided.
	Subsequent to December 31, 2014, we issued an aggregate of 98,688 shares of Common Stock to two accredited investors upon the conversion of an aggregate of $207,245 of unpaid principal and accrued interest due under convertible promissory notes previously issued to the investors. The conversion price per share was $2.10 (see Note 6).	Subsequent to March 31, 2014, we completed unit subscription agreements with seven accredited investors (the “Purchasers”) pursuant to which the Purchasers purchased an aggregate of $320,800 of restricted common stock at an average price of $7.32 per share. The common stock purchase price under the subscription agreement was determined to be 80% of the average closing price of our common stock for the five-day period immediately preceding the date of each subscription agreement, resulting in the issuance of 43,849 shares of common stock.
	Warrant Exercises	Each Purchaser also received one common stock purchase warrant for each two shares of common stock purchased under his subscription agreement. The warrant exercise price was calculated based upon 120% of the average of the closing prices of our common stock for the five-day period immediately preceding the parties entering into their subscription agreement.
	Subsequent to December 31, 2014, we issued 3,574 shares of common stock to an accredited investor upon the exercise of a previously issued warrant. The warrant was exercised on a cashless or “net” basis. Accordingly, we did not receive any proceeds from such exercise. The cashless exercise of the warrant resulted in the cancellation of the previously issued warrant to purchase an aggregate of 5,176 shares of common stock.	Stock Option Grants
		On June 6, 2014, our Board of Directors approved the following grants of options to certain officers and directors of the Company:
			·	To Mr. James A. Joyce, an option to acquire an aggregate of 30,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The option vested as to 10,000 shares on the grant date and will vest as to an additional 10,000 shares on each of the first two anniversaries of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
			·	To Mr. Rodney S. Kenley, an option to acquire an aggregate of 5,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The option vested as to 1,666 shares on the grant date and will vest as to an additional 1,666 shares on the first anniversary of the grant date and 81,667 shares on the second anniversary of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
			·	To Mr. James B. Frakes, an option to acquire an aggregate of 5,000 shares of our common stock at an exercise price of $9.50 per share, the closing price of our common stock on the date of grant. The option vested as to 1,666 shares on the grant date and will vest as to an additional 1,666 shares on the first anniversary of the grant date and 1,667 shares on the second anniversary of the grant date. Unless earlier exercised or terminated, the option will expire June 6, 2024.
		Changes to 2012 Board Compensation Program
		In July 2012, the Board approved a Board Compensation Program (the “2012 Program”), which modified and superseded the 2005 Directors Compensation Program that had been in effect previously. On June 6, 2014, the Board approved certain changes to the 2012 Program. Under the modified 2012 Program, in which only non-employee Directors may participate, a new eligible Director will receive an initial grant of $50,000 worth of options to acquire shares of common stock, with such grant being valued at the exercise price based on the average of the closing bid prices of our common stock for the five trading days preceding the first day of the fiscal year. These options will have a term of ten years and will vest 1/3 upon grant and 1/3 upon each of the first two anniversaries of the date of grant.
		At the beginning of each fiscal year, each existing Director eligible to participate in the 2012 Program also will receive a grant of $35,000 worth of options valued at the exercise price based on the average of the closing bid prices of the Common Stock for the five trading days preceding the first day of the fiscal year. Such options will vest on the first anniversary of the date of grant. In lieu of per meeting fees, under the 2012 Program eligible Directors will receive an annual Board retainer fee of $30,000. The modified 2012 Program also provides for the following annual retainer fees: Audit Committee Chair - $5,000, Compensation Committee chair - $5,000, Audit Committee member - $4,000, Compensation Committee member - $4,000 and Lead independent director - $15,000.
		All of the foregoing actions - the changes in base salaries, the option grants and the changes to the Directors Compensation Program discussed herein - were approved and recommended by the Company’s Compensation Committee prior to approval by the Board.
		Convertible Notes Payable – See Note 16 below.

2_PROPERTY_AND_EQUIPMENT_March

2. PROPERTY AND EQUIPMENT (March 2014 note)	12 Months Ended
	Mar. 31, 2014
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT	2. PROPERTY AND EQUIPMENT
	Property and equipment, net, consist of the following:
		31-Mar-14			31-Mar-13
	Furniture and office equipment, at cost	$	385,088		$	289,031
	Accumulated depreciation		(300,809	)		(288,886	)
		$	84,279		$	145
	Depreciation expense for the years ended March 31, 2014 and 2013 approximated $12,000 and $1,000, respectively.

3_PATENTS_March_2014_note

3. PATENTS (March 2014 note)	12 Months Ended
	Mar. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
PATENTS	3. PATENTS
	Patents consist of the following:
		31-Mar-14			31-Mar-13
	Patents	$	157,442		$	157,442
	Patents pending and trademarks		54,203			54,203
	Accumulated amortization		(99,156	)		(89,992	)
		$	112,489		$	121,653
	Amortization expense for patents for the years ended March 31, 2014 and 2013 approximated $9,000. Future amortization expense on patents is estimated to be approximately $9,000 per year based on the estimated life of the patents. The weighted average remaining life of our patents is approximately 6.5 years.

9_INCOME_TAXES_March_2014_note

9. INCOME TAXES (March 2014 note)	12 Months Ended
	Mar. 31, 2014
Income Tax Disclosure [Abstract]
INCOME TAXES	9. INCOME TAXES
	For the years ended March 31, 2014 and 2013, we had no income tax expense due to our net operating losses and 100% deferred tax asset valuation allowance.
	At March 31, 2014 and 2013, we had net deferred tax assets as detailed below. These deferred tax assets are primarily composed of capitalized research and development costs and tax net operating loss carryforwards. Due to uncertainties surrounding our ability to generate future taxable income to realize these assets, a 100% valuation has been established to offset the net deferred tax assets.
	Significant components of our net deferred tax assets at March 31, 2014 and 2013 are shown below:
		YEAR ENDED MARCH 31,
		2014			2013
	Deferred tax assets:
	Capitalized research and development	$	3,442,000		$	3,442,000
	Net operating loss carryforwards		15,193,000			14,793,000
	Total deferred tax assets		18,635,000			18,235,000
	Total deferred tax liabilities		–			–
	Net deferred tax assets		18,635,000			18,235,000
	Valuation allowance for deferred tax assets		(18,635,000	)		(18,235,000	)
	Net deferred tax assets	$	–		$	–
	At March 31, 2014, we had tax net operating loss carryforwards for federal and state purposes approximating $39 million and $30 million, which begin to expire in the year 2020.
	The provision for income taxes on earnings subject to income taxes differs from the statutory federal rate for the years ended March 31, 2014 and 2013 due to the following:
		2014			2013
	Income taxes (benefit) at federal statutory rate of 34%	$	(4,541,000	)	$	(1,663,000	)
	State income tax, net of federal benefit		(156,000	)		(285,000	)
	Tax effect on non-deductible expenses and credits		4,297,000			215,000
	Change in valuation allowance1		400,000			1,733,000
		$	–		$	–
	Pursuant to Internal Revenue Code Sections 382, use of our tax net operating loss carryforwards may be limited.
	ASC 740, “Income Taxes”, clarifies the accounting for uncertainty in income taxes recognized in an entity's financial statements, and prescribes recognition thresholds and measurement attributes for financial statement disclosure of tax positions taken or expected to be taken on a tax return. Under ASC 740, the impact of an uncertain income tax position on the income tax return must be recognized at the largest amount that is more-likely-than-not to be sustained upon audit by the relevant taxing authority. An uncertain income tax position will not be recognized if it has less than a 50% likelihood of being sustained. Additionally, ASC 740 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. Our practice is to recognize interest and/or penalties related to income tax matters in income tax expense. During the years ended March 31, 2014 and 2013, we did not recognize any interest or penalties relating to tax matters.
	At and for the years ended March 31, 2014 and 2013, management does not believe the Company has any uncertain tax positions.
	Accordingly, there are no unrecognized tax benefits at March 31, 2014 or March 31, 2013.
	Our tax returns for the years 2010 and forward are subject to examination by the Internal Revenue Service and 2009 and forward by the California Franchise Tax Board. We are currently not under examination by any taxing authorities.

12_SIGNIFICANT_FOURTH_QUARTER_

12. SIGNIFICANT FOURTH QUARTER ADJUSTMENTS (March 2014 note)	12 Months Ended
	Mar. 31, 2014
Quarterly Financial Information Disclosure [Abstract]
SIGNIFICANT FOURTH QUARTER ADJUSTMENTS	12. SIGNIFICANT FOURTH QUARTER ADJUSTMENTS
	During the fourth quarter of the fiscal years ended March 31, 2014 and 2013, we did not deem any unusual or infrequently occurring items or adjustments to be material to our fourth quarter results.

16_PRO_FORMA_BALANCE_SHEET_Mar

16. PRO FORMA BALANCE SHEET (March 2014 note)	12 Months Ended
	Mar. 31, 2014
Pro Forma Balance Sheet March 2014 Note
PRO FORMA BALANCE SHEET	NOTE 16 – PRO FORMA BALANCE SHEET (UNAUDITED)
	Management has presented unaudited pro forma balance sheet information as if the subsequent events discussed below had occurred on March 31, 2014. Such pro forma information is subject to future adjustment as management determines the final accounting for such transactions.
	Weiner Note Conversion
	On June 24, 2014, we entered into an agreement with the Ellen R. Weiner Family Revocable Trust (the “Trust”), a holder of a Series A 12% Convertible Note (the “Note”) (see Note 5), which previously was classified as being in default. As per the agreement, the Trust converted a past due combined principal and interest balance of $1,003,200 into restricted common stock.
	Additionally, the Trust agreed to waive anti-dilution price protection underlying warrants previously issued to the Trust. On June 26, 2014, three other parties who held similar warrants also agreed to waive their anti-dilution price protection. As a result of the debt conversion and elimination of warrant anti-dilution price protection, $3.7 million of our previously classified derivative liability will convert into equity based on the fair value of securities on our fiscal year-end date of March 31, 2014.
	As a result of the note conversion and derivative liability reclassification into equity, our balance sheet equity will increase by approximately $4.7 million.
	Under its agreement, the Trust converted the entire $1,003,200 past due principal and interest balance on the Note, which previously was in default, into an aggregate of 466,365 restricted shares of our common stock and five-year warrants to acquire up to 136,190 shares of our common stock at an exercise price of $2.10 per share and up to 7,944 shares of our common stock at an exercise price of $5.40 per share (collectively, the “Conversion Securities”).
	In exchange for the Trust’s conversion in full of the Note and accrued interest and for the waivers of anti-dilution price protection in the previously issued warrants, in addition to the Conversion Securities, we issued to the Trust 1,500 restricted shares of common stock as a service fee, changed the exercise price of all of the previously issued warrants to $2.10 per share and extended the expiration date of all of the previously issued warrants to July 1, 2018.
	Bird Estate Extension
	On July 8, 2014, we entered into a restructuring agreement (the “Agreement”) with the Estate of Allan Bird (the “Estate”), a holder of a Series A 12% Convertible Note (the “Note”), which previously was classified as being in default. In the Agreement, the Estate agreed to extend the expiration date of the Note to April 1, 2016, to convert approximately $116,970 of accrued interest to equity, and to waive anti-dilution price protection underlying the Note and warrants previously issued to the Estate.
		·	As a result of the waiver of all anti-dilution price protection by the Estate, we will reclassify to equity $1,238,292 from derivative liability.
		·	Also, the execution of the Agreement results in the waiver of anti-dilution price protection under agreements with three other note and warrant holders, which will cause an additional $5,724,761 of derivative liability to be reclassified from liability to equity.
		·	In addition, as a result of a note conversion and waiver of anti-dilution price protection previously reported on Form 8-K on June 30, 2014, a combined $4,719,214 of principal, accrued interest and derivative liability has been reclassified into equity.
		·	Based on the Agreement, the elimination of antidilution provisions and the note and accrued interest conversions, all previously reported derivative liabilities will be reclassified into equity.
	Under the Agreement, the Estate converted the entire $116,970 past due interest balance on the Note, which previously was in default, into an aggregate of 51,837 restricted shares of our common stock. The Estate received five-year warrants to acquire up to 46,429 shares of our common stock at an exercise price of $2.10 per share (which exercise price was the result of certain contractual price adjustments previously made during 2011). Based on our common stock prices during a period of negotiation with the Estate including during calendar year 2013, the Estate also received five-year warrants to acquire up to 2,708 shares of our common stock at an exercise price of $5.40 (collectively known as the “Conversion Securities”).
	In exchange for the Estate’s extension of the Note, conversion of accrued interest and for the waivers of anti-dilution price protection in the previously issued warrants, in addition to the Conversion Securities, we also issued to the Estate 500 restricted shares of common stock as a service fee and extended the expiration date of all of the previously issued warrants to July 1, 2018.
	Pro Forma References
	The unaudited pro forma balance sheet information as of March 31, 2014 assumes (1) conversion of one of the Amended and Restated Series A 12% Convertible Notes (the Trust Note) in the principal amount of $660,000 as well as $343,200 of related accrued interest into 466,000 million shares of common stock, (2) the extension of the other Amended and Restated Series A 12% Convertible Note (the Estate Note) and conversion of $116,970 of related accrued interest into 52,000 million shares of common stock, (3) reduction of accrued interest balance by $85,800 for the Trust Note and by $29,280 for the Estate Note, (4) the waiver of price antidilution protection on certain warrants in exchange for an extension on those warrants with a corresponding fair value change based on June 24, 2014 inputs of $96,469 for the Trust warrant extension and based on July 8, 2014 inputs of $29,679 for the Estate warrants, (5) the reclassification of $10,679,067 of our derivative liability into paid in capital based upon the fair value of those derivatives at March 31, 2014, (6) calculation of a loss on the payment of shares and warrants as part of the conversion of accrued interest with an estimated fair value of $1,876,421 to the Trust and $665,571 to the Estate, and (7) the payment of 1,500 restricted shares of common stock to the Trust as a fee, valued at $12,000 and the payment of 500 restricted shares of common stock, valued at $4,250.
	The following unaudited pro forma information has been prepared as though these subsequent event transactions had occurred on March 31, 2014. The pro forma references refer to the above paragraph.
			Aethlon Medical, Inc.			Pro Forma Adjustments				Pro Forma
			Consolidated Balance Sheet March 31,							Consolidated Balance Sheet March 31,
			2014			Amount			Reference	2014
	ASSETS
	CURRENT ASSETS
	Cash		$	1,250,279		$	–			$	1,250,279
	Accounts receivable			95,177			–				95,177
	Deferred financing costs			83,191			–				83,191
	Prepaid expenses			50,699			–				50,699
	TOTAL CURRENT ASSETS			1,479,346			–				1,479,346
	NON-CURRENT ASSETS
	Property and equipment, net			84,279			–				84,279
	Patents, net			112,489			–				112,489
	Deposits			18,988			–				18,988
	TOTAL NONCURRENT ASSETS			215,756			–				215,756
	TOTAL ASSETS		$	1,695,102		$	–			$	1,695,102
	LIABILITIES AND DEFICIT
	CURRENT LIABILITIES
	Accounts payable		$	517,651		$	–			$	517,651
	Due to related parties			839,070							839,070
	Notes payable, net			390,000							390,000
	Convertible notes payable, current portion			1,367,655			(885,000	)	(1) & (2)		482,655
	Derivative liabilities			10,679,067			(10,679,067	)	-5		–
	Other current liabilities			1,855,374			(575,250	)	(1), (2) &(3)		1,280,124
	TOTAL CURRENT LIABILITIES			15,648,817			(12,139,317	)			3,509,500
	NONCURRENT LIABILITIES
	Convertible notes payable, non-current portion			776,451			225,000		-2		1,001,451
	TOTAL NONCURRENT LIABILITIES			776,451			225,000				1,001,451
	TOTAL LIABILITIES			16,425,268			(11,914,317	)			4,510,951
	COMMITMENTS AND CONTINGENCIES
	STOCKHOLDERS' DEFICIT
	Common stock (Revised – Note 1)			4,497			523		(1), (5), (6) & (7)		5,020
	Additional paid in capital (Revised – Note 1)			59,879,624			14,483,104		(1), (4), (5), (6) & (7)		74,362,728
	Accumulated deficit			(74,832,557	)		(2,569,310	)	(2), (3), (4), (5), (6) & (7)		(77,401,867	)
	TOTAL AETHLON MEDICAL, INC. STOCKHOLDERS' DEFICIT			(14,948,436	)		11,914,317				(3,034,119	)
	Noncontrolling interests			218,270			–				218,270
	TOTAL DEFICIT			(14,730,166	)		11,914,317				(2,815,849	)
	TOTAL LIABILITIES AND DEFICIT		$	1,695,102		$	–			$	1,695,102

3_SUMMARY_OF_SIGNIFICANT_ACCOU1

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

12 Months Ended

Dec. 31, 2014

Mar. 31, 2014

Accounting Policies [Abstract]

PRINCIPLES OF CONSOLIDATION

PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned and controlled subsidiary, ESI. All significant intercompany balances and transactions have been eliminated in consolidation. The Company classifies the noncontrolling interests in ESI as part of consolidated net loss in the fiscal year ended March 31, 2014 and includes the accumulated amount of noncontrolling interests as part of stockholders’ equity. For the fiscal year ended March 31, 2013, ESI was a wholly-owned subsidiary. During the fiscal year ended March 31, 2014, Aethlon Medical, Inc. reduced its ownership percentage to 80% by ESI’s issuance of 300,000 shares of ESI common stock in exchange for cash of $1,500,000.

The accompanying condensed consolidated financial statements include the accounts of Aethlon Medical, Inc. and its majority-owned and controlled subsidiary, Exosome Sciences, Inc. All significant intercompany balances and transactions have been eliminated in consolidation. The Company classifies the noncontrolling interests in Exosome Sciences, Inc. as part of consolidated net loss in the nine months ended December 31, 2014 and includes the accumulated amount of noncontrolling interests as part of stockholders’ equity. During the fiscal year ended March 31, 2014, Exosome Sciences, Inc. raised capital in the amount of $1,500,000 in exchange for the issuance of 300,000 shares of Exosome Sciences, Inc. common stock to Exosome Sciences, Inc.’s investors, representing 20% of Exosome Sciences, Inc.’s issued and outstanding capital stock. As a result, Aethlon Medical, Inc.’s ownership of Exosome Sciences, Inc. was reduced to 80%. If a further change in Aethlon Medical Inc.’s ownership of Exosome Sciences, Inc. results in loss of control and deconsolidation, any retained ownership interest will be remeasured with the gain or loss reported in our statement of operations.

The losses at ESI during the fiscal year ended March 31, 2014 reduced the noncontrolling interests on our consolidated balance sheet by $81,730 from $300,000 to $218,270 at March 31, 2014.

The losses at Exosome Sciences, Inc. during the nine months ended December 31, 2014 reduced the noncontrolling interests on our consolidated balance sheet by $140,683 from $218,270 at March 31, 2014 to $77,587 at December 31, 2014.

GOING CONCERN

The accompanying consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates, among other things, the realization of assets and satisfaction of liabilities in the ordinary course of business. We have incurred continuing losses from operations and at March 31, 2014 are in default on certain debt agreements, have negative working capital of approximately $14,169,000, and an accumulated deficit of approximately $74,833,000. These factors, among other matters, raise substantial doubt about our ability to continue as a going concern. A significant amount of additional capital will be necessary to advance the development of our products to the point at which they may become commercially viable. We intend to fund operations, working capital and other cash requirements for the fiscal year ending March 31, 2015 through debt and/or equity financing arrangements as well as through revenues and related cash receipts under our government contracts (see Note 11).

We are currently addressing our liquidity issue by seeking additional investment capital through private placements of common stock and debt and by applying for additional grants issued by government agencies in the United States. We believe that our cash on hand and funds expected to be received from additional private investment will be sufficient to meet our liquidity needs for fiscal 2015. However, no assurance can be given that we will receive any funds in addition to the funds we have received to date.

The successful outcome of future activities cannot be determined at this time and there is no assurance that, if achieved, we will have sufficient funds to execute our intended business plan or generate positive operating results.

Subsequent to March 31, 2014, we completed several significant transactions related to our convertible notes (see Note 16).

The consolidated financial statements do not include any adjustments related to this uncertainty and as to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.

RISKS AND UNCERTAINTIES

We operate in an industry that is subject to intense competition, government regulation and rapid technological change. Our operations are subject to significant risk and uncertainties including financial, operational, technological, regulatory, and including the potential risk of business failure.

USE OF ESTIMATES

USE OF ESTIMATES

We prepare our consolidated financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, valuation of derivative liabilities, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets. Actual results could differ from those estimates.

We prepare our condensed consolidated financial statements in conformity with GAAP, which requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting periods. Significant estimates made by management include, among others, realization of long-lived assets, estimating fair value associated with debt and equity transactions and valuation of deferred tax assets. Actual results could differ from those estimates.

CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS

Accounting standards define "cash and cash equivalents" as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased, or any investment redeemable without penalty or loss of interest to be cash equivalents.  As of March 31, 2014 and 2013, we had no assets that were classified as cash equivalents.

Accounting standards define "cash and cash equivalents" as any short-term, highly liquid investment that is both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. For the purpose of financial statement presentation, we consider all highly liquid investment instruments with original maturities of three months or less when purchased, or any investment redeemable without penalty or loss of interest to be cash equivalents. As of December 31, 2014 and March 31, 2014, we had no assets that were classified as cash equivalents.

CONCENTRATIONS OF CREDIT RISKS

CONCENTRATIONS OF CREDIT RISKS

Cash is maintained at two financial institutions in checking accounts and related cash management accounts. Accounts at these institutions are secured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Our March 31, 2014 cash balances were approximately $1,000,000 over such insured amount. We do not believe that the Company is exposed to any significant risk with respect to its cash.

Cash is maintained at two financial institutions in checking accounts and related cash management accounts. Accounts at these institutions are secured by the Federal Deposit Insurance Corporation ("FDIC") up to $250,000. Our December 31, 2014 cash balances were approximately $2,275,000 over such insured amount. We do not believe that the Company is exposed to any significant risk with respect to its cash.

All of our accounts receivable at March 31, 2014 and 2013 and all of our revenue in the fiscal years ended March 31, 2014 and 2013 were directly from the U.S. Department of Defense or from a subcontract under Battelle, which is a prime contractor with the U.S. Department of Defense.

All of our accounts receivable at December 31, 2014 and March 31, 2014 and all of our revenue in the nine month periods ended December 31, 2014 and 2013 were directly from the U.S. Department of Defense or from a subcontract under Battelle Memorial Institute, which is a prime contractor with the U.S. Department of Defense, and as such no allowance for uncollectable accounts receivable was deemed necessary at December 31, 2014 or March 31, 2014.

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

The carrying amount of our cash, accounts receivable, accounts payable, and other current liabilities approximates their estimated fair values due to the short-term maturities of those financial instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and since the interest rates approximate current market interest rates for similar instruments. Derivative liabilities recorded in connection with warrants and embedded conversion features of certain convertible notes payable are reported at their estimated fair value, with changes in fair value being reported in results of operations (see Note 10).

The carrying amount of our cash, accounts receivable, accounts payable, and other current liabilities approximate their estimated fair values due to the short-term maturities of those financial instruments. The carrying amount of the notes payable approximates their fair value due to the short maturity of the notes and since the interest rate approximates current market interest rates for similar instruments.

Management has concluded that it is not practical to determine the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated potential costs.

Management has concluded that it is not practical to determine the estimated fair value of amounts due to related parties because the transactions cannot be assumed to have been consummated at arm's length, the terms are not deemed to be market terms, there are no quoted values available for these instruments, and an independent valuation would not be practicable due to the lack of data regarding similar instruments, if any, and the associated potential costs.

Other than our derivative liabilities, we do not have any assets or liabilities that are measured at fair value on a recurring basis and, during the years ended March 31, 2014 and 2013, did not have any assets or liabilities that were measured at fair value on a nonrecurring basis except as described in Note 10 under derivative liabilities.

See Note 9 with respect to derivative liabilities.

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in the consolidated statements of operations.

Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives of the related assets, which range from two to five years. Repairs and maintenance are charged to expense as incurred while improvements are capitalized. Upon the sale or retirement of property and equipment, the accounts are relieved of the cost and the related accumulated depreciation with any gain or loss included in the consolidated statements of operations.

INCOME TAXES

INCOME TAXES

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future, it is more likely than not that some portion of the deferred tax assets may not be realized.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to the difference between the consolidated financial statements and their respective tax basis. Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts reported for income tax purposes, and (b) tax credit carryforwards. We record a valuation allowance for deferred tax assets when, based on our best estimate of taxable income (if any) in the foreseeable future, it is more likely than not that some portion of the deferred tax assets may not be realized.

IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS

IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS

Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the cost basis of a long-lived asset is greater than the projected future undiscounted net cash flows from such asset, an impairment loss is recognized. We believe no impairment charges were necessary during the three and nine month periods ended December 31, 2014 and 2013.

LOSS PER COMMON SHARE

LOSS PER COMMON SHARE

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

Basic loss per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period of computation. Diluted loss per share is computed similar to basic loss per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if potential common shares had been issued, if such additional common shares were dilutive. Since we had net losses for all periods presented, basic and diluted loss per share are the same, and additional potential common shares have been excluded as their effect would be antidilutive.

As of March 31, 2014 and 2013, a total of 2,861,492 and 2,854,024 potential common shares, consisting of shares underlying outstanding stock options, warrants and convertible notes payable were excluded as their inclusion would be antidilutive.

As of December 31, 2014 and 2013, a total of 2,205,525 and 2,902,111 potential common shares, consisting of shares underlying outstanding stock options, warrants and convertible notes payable were excluded as their inclusion would be antidilutive.

SEGMENTS

SEGMENTS

Historically, we operated in one segment that was based on our development of therapeutic devices. However in the December 2013 quarter, we initiated the operations of ESI to develop diagnostic tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and ESI for diagnostic applications (See Note 14).

Historically, we operated in one segment that was based on our development of therapeutic devices. However in the December 2013 quarter, we initiated the operations of Exosome Sciences, Inc. to develop diagnostic tests. As a result, we now operate in two segments, Aethlon for therapeutic applications and Exosome Sciences, Inc. for diagnostic applications (See Note 14).

DEFERRED FINANCING COSTS

DEFERRED FINANCING COSTS

Costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method.  We recorded amortization expense related to our deferred offering costs of $863 and $127,200 during the fiscal years ended March 31, 2014 and 2013, respectively.

Costs related to the issuance of debt are capitalized and amortized to interest expense over the life of the related debt using the effective interest method.  We recorded amortization expense related to our deferred offering costs of $68,982 and $863 during the nine month periods ended December 31, 2014 and 2013, respectively.

REVENUE RECOGNITION

REVENUE RECOGNITION

DARPA Contract -- With respect to revenue recognition, we entered into a government contract with DARPA and have recognized revenue of $1,466,482 and $1,230,004 under that contract during the fiscal years ended March 31, 2014 and 2013, respectively. We adopted the Milestone method of revenue recognition for the DARPA contract under ASC 605-28 “Revenue Recognition – Milestone Method” and we believe we meet the requirements under ASC 605-28 for reporting contract revenue under the Milestone Method for the fiscal years ended March 31, 2014 and 2013.

DARPA Contract -- With respect to revenue recognition, we entered into a government contract with DARPA and have recognized revenue under such contract. We adopted the Milestone method of revenue recognition for the DARPA contract under Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 605-28 “Revenue Recognition – Milestone Method” and we believe we meet the requirements under ASC 605-28 for reporting contract revenue under the Milestone Method.

In order to account for this contract, we identify the deliverables included within the contract and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

In order to account for this contract, we identify the deliverables included within the contract and evaluate which deliverables represent separate units of accounting based on if certain criteria are met, including whether the delivered element has standalone value to the collaborator. The consideration received is allocated among the separate units of accounting, and the applicable revenue recognition criteria are applied to each of the separate units.

A milestone is an event having all of the following characteristics:

A milestone is an event having all of the following characteristics:

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

(3) If achieved, the event would result in additional payments being due to the vendor.

(3) If achieved, the event would result in additional payments being due to the vendor.

A milestone is an event having all of the following characteristics:

A milestone does not include events for which the occurrence is either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty’s performance.

(1) There is substantive uncertainty at the date the arrangement is entered into that the event will be achieved. A vendor’s assessment that it expects to achieve a milestone does not necessarily mean that there is not substantive uncertainty associated with achieving the milestone.

The policy for recognizing deliverable consideration contingent upon achievement of a milestone must be applied consistently to similar deliverables.

(2) The event can only be achieved based in whole or in part on either: (a) the vendor’s performance; or (b) a specific outcome resulting from the vendor’s performance.

The assessment of whether a milestone is substantive is performed at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

(3) If achieved, the event would result in additional payments being due to the vendor.

(1) The consideration is commensurate with either: (a) the vendor’s performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the vendor’s performance to achieve the milestone;

A milestone does not include events for which the occurrence is either: (a) contingent solely upon the passage of time; or (b) the result of a counterparty’s performance.

(2) The consideration relates solely to past performance; and

The policy for recognizing deliverable consideration contingent upon achievement of a milestone must be applied consistently to similar deliverables.

(3) The consideration is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

The assessment of whether a milestone is substantive is performed at the inception of the arrangement. The consideration earned from the achievement of a milestone must meet all of the following for the milestone to be considered substantive:

A milestone is not considered substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive and non-substantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded or adjusted based on future performance, the related milestone is not considered substantive.

(1) The consideration is commensurate with either: (a) the vendor’s performance to achieve the milestone; or (b) the enhancement of the value of the delivered item or items as a result of a specific outcome resulting from the vendor’s performance to achieve the milestone;

See Note 12 for the additional disclosure information required under ASC 605-28.

(2) The consideration relates solely to past performance; and

Battelle Memorial Institute Subcontract -- We entered into a subcontract agreement with Battelle Memorial Institute Memorial Institute (“Battelle Memorial Institute”) in March 2013. Battelle Memorial Institute was chosen by DARPA to be the prime contractor on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration project. The Battelle Memorial Institute subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the subcontract during the nine months ended December 31, 2013.

(3) The consideration is reasonable relative to all of the deliverables and payment terms (including other potential milestone consideration) within the arrangement.

Our revenue under this contract is a function of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees). Battelle Memorial Institute engages us as needed. Each payment requires approval by the program manager at Battelle Memorial Institute.

A milestone is not considered substantive if any portion of the associated milestone consideration relates to the remaining deliverables in the unit of accounting (i.e., it does not relate solely to past performance). To recognize the milestone consideration in its entirety as revenue in the period in which the milestone is achieved, the milestone must be substantive in its entirety. Milestone consideration cannot be bifurcated into substantive and nonsubstantive components. In addition, if a portion of the consideration earned from achieving a milestone may be refunded or adjusted based on future performance, the related milestone is not considered substantive.

See Note 11 for the additional disclosure information required under ASC 605-28.

Battelle Subcontract -- We entered into a subcontract agreement with Battelle Memorial Institute (“Battelle”) in March 2013. Battelle was chosen by DARPA to be the prime contractor on the systems integration portion of the original DARPA contract and we are one of several subcontractors on that systems integration project. The Battelle subcontract is cost-reimbursable under a time and materials basis. We began generating revenues under the subcontract during the three months ended September 30, 2013 and for the fiscal year 2014 recorded revenue of $157,287.

Our revenue under this contract is a function of cost reimbursement plus an overhead mark-up for hours devoted to the project by specific employees (with specific hourly rates for those employees). Battelle engages us as needed. Each payment requires approval by the program manager at Battelle.

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION

Employee stock options and rights to purchase shares under stock participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive awards granted subsequent to April 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see Note 6).

Employee stock options and rights to purchase shares under stock participation plans are accounted for under the fair value method. Accordingly, share-based compensation is measured when all granting activities have been completed, generally the grant date, based on the fair value of the award. The exercise price of options is generally equal to the market price of the Company's common stock (defined as the closing price as quoted on the OTCBB on the date of grant). Compensation cost recognized by the Company includes (a) compensation cost for all equity incentive awards granted prior to April 1, 2006, but not yet vested, based on the grant-date fair value estimated in accordance with the original provisions of the then current accounting standards, and (b) compensation cost for all equity incentive awards granted subsequent to April 1, 2006, based on the grant-date fair value estimated in accordance with the provisions of subsequent accounting standards. We use a Binomial Lattice option pricing model for estimating fair value of options granted (see Note 10).

The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the years ended March 31, 2014 and 2013:

The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the nine month periods ended December 31, 2014 and 2013:

31-Mar-14

31-Mar-13

Vesting of Stock Options

$

541,588

$

355,578

Nine Months

Nine Months

Incremental fair value of option Modifications

1,914

23,028

Ended

Ended

Vesting Expense Associated with CEO Restricted Stock Grant

64,444

386,667

December 31,

December 31,

Total Stock-Based Compensation Expense

$

607,946

$

765,273

2014

2013

Vesting of stock options

$

338,580

$

156,993

Basic and diluted loss per common share

$

(0.16

)

$

(0.26

)

Incremental fair value of option modifications

–

1,914

Vesting expense associated with CEO restricted stock grant

–

64,444

We account for transactions involving services provided by third parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received (i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of the transactions, we use the following methodology:

Total stock-based compensation expense

$

338,580

$

223,351

a) For transactions where goods have already been delivered or services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date of issuance).

Weighted average number of common shares outstanding – basic and diluted

5,254,459

3,750,111

b) For transactions where the instruments are issued on a fully vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.

Basic and diluted loss per common share associated with stock-based compensation expense

$

(0.06

)

$

(0.06

)

c) For any transactions not meeting the criteria in (a) or (b) above, we re-measure the consideration at each reporting date based on its then current stock value.

We account for transactions involving services provided by third parties where we issue equity instruments as part of the total consideration using the fair value of the consideration received (i.e. the value of the goods or services) or the fair value of the equity instruments issued, whichever is more reliably measurable. In transactions, when the value of the goods and/or services are not readily determinable and (1) the fair value of the equity instruments is more reliably measurable and (2) the counterparty receives equity instruments in full or partial settlement of the transactions, we use the following methodology:

We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate for all expense amortization after March 31, 2006 is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the fiscal year ended March 31, 2014 was insignificant.

a) For transactions where goods have already been delivered or services rendered, the equity instruments are issued on or about the date the performance is complete (and valued on the date of issuance).

b) For transactions where the instruments are issued on a fully vested, non-forfeitable basis, the equity instruments are valued on or about the date of the contract.

c) For any transactions not meeting the criteria in (a) or (b) above, we re-measure the consideration at each reporting date based on its then current stock value.

We review share-based compensation on a quarterly basis for changes to the estimate of expected award forfeitures based on actual forfeiture experience. The effect of adjusting the forfeiture rate for all expense amortization after March 31, 2006 is recognized in the period the forfeiture estimate is changed. The effect of forfeiture adjustments for the nine months ended December 31, 2014 was insignificant.

PATENTS

PATENTS

Patents include both foreign and domestic patents. There were several patents pending at March 31, 2014. We capitalize the cost of patents and patents pending, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their estimated economic life, upon issuance of the patent. The unamortized costs of patents and patents pending are subject to our review for impairment under our long-lived asset policy above.

Patents include both foreign and domestic patents. There were several patents pending at December 31, 2014. We capitalize the cost of patents and patents pending, some of which were acquired, and amortize such costs over the shorter of the remaining legal life or their estimated economic life, upon issuance of the patent. The unamortized costs of patents and patents pending are subject to our review for impairment under our long-lived asset policy above.

STOCK PURCHASE WARRANTS

STOCK PURCHASE WARRANTS

We grant warrants in connection with the issuance of convertible notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection with equity transactions and the warrant fair value is recorded to additional paid-in-capital. Lastly, warrants not meeting equity classification are recorded as derivative instruments.

We grant warrants in connection with the issuance of convertible notes payable and the issuance of common stock for cash. When such warrants are classified as equity and issued in connection with debt, we measure the relative estimated fair value of such warrants and record it as a discount from the face amount of the convertible notes payable. Such discounts are amortized to interest expense over the term of the notes using the effective interest method. Warrants issued in connection with common stock for cash, if classified as equity, are considered issued in connection with equity transactions and the warrant fair value is recorded to additional paid-in-capital. Lastly, warrants not meeting equity classification are recorded as derivative instruments.

DERIVATIVE INSTRUMENTS

DERIVATIVE INSTRUMENTS

We evaluate free-standing derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

We evaluate free-standing derivative instruments (or embedded derivatives) to properly classify such instruments within equity or as liabilities in our financial statements. Our policy is to settle instruments indexed to our common shares on a first-in-first-out basis.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

The classification of a derivative instrument is reassessed at each reporting date. If the classification changes as a result of events during a reporting period, the instrument is reclassified as of the date of the event that caused the reclassification. There is no limit on the number of times a contract may be reclassified.

Instruments classified as derivative liabilities are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations in other (income) expense.

Instruments classified as derivative liabilities are remeasured each reporting period (or upon reclassification) and the change in fair value is recorded on our consolidated statement of operations in other (income) expense.

BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE

BENEFICIAL CONVERSION FEATURE OF CONVERTIBLE NOTES PAYABLE

The convertible feature of certain notes payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a "Beneficial Conversion Feature" ("BCF"). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.

The convertible feature of certain notes payable provides for a rate of conversion that is below market value. Such feature is normally characterized as a "Beneficial Conversion Feature" ("BCF"). We measure the estimated fair value of the BCF in circumstances in which the conversion feature is not required to be separated from the host instrument and accounted for separately, and record that value in the consolidated financial statements as a discount from the face amount of the notes. Such discounts are amortized to interest expense over the term of the notes.

REGISTRATION PAYMENT ARRANGEMENTS

REGISTRATION PAYMENT ARRANGEMENTS

We account for contingent obligations to make future payments or otherwise transfer consideration under a registration payment arrangement separately from any related financing transaction agreements, and any such contingent obligations are recognized only when it is determined that it is probable that the Company will become obligated for future payments and the amount, or range of amounts, of such future payments can be reasonably estimated.

We account for contingent obligations to make future payments or otherwise transfer consideration under a registration payment arrangement separately from any related financing transaction agreements, and any such contingent obligations are recognized only when it is determined that it is probable we will become obligated for future payments and the amount, or range of amounts, of such future payments can be reasonably estimated.

RESEARCH AND DEVELOPMENT EXPENSES

RESEARCH AND DEVELOPMENT EXPENSES

Our research and development costs are expensed as incurred. We incurred approximately $1,509,000 and $1,440,000 of research and development expenses for the years ended March 31, 2014 and 2013, respectively, which are included in various operating expenses in the accompanying consolidated statements of operations.

We incurred research and development expenses during the three and nine month periods ended December 31, 2014 and 2013, which are included in various operating expense line items in the accompanying condensed consolidated statements of operations. Our research and development expenses in those periods were as follows:

December 31,

December 31,

2014

2013

Three months ended

$

214,165

$

542,383

Nine months ended

$

747,657

$

1,178,488

OFF-BALANCE SHEET ARRANGEMENTS

OFF-BALANCE SHEET ARRANGEMENTS

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial statements.

We have not entered into any off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our consolidated financial statements.

SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS

SIGNIFICANT RECENT ACCOUNTING PRONOUNCEMENTS

Management is evaluating significant recent accounting pronouncements that are not yet effective for the Company, including the new accounting standard on revenue recognition, ASU 2014-09 (Topic 606), and has not yet concluded whether any such pronouncements will have a significant effect on the Company’s future consolidated financial statements.

Management is evaluating significant recent accounting pronouncements that are not yet effective for the Company, including the new accounting standard on revenue recognition, Accounting Standards Update (“ASU”) 2014-09 (Topic 606), and has not yet concluded whether any such pronouncements will have a significant effect on the Company’s future consolidated financial statements.

3_SUMMARY_OF_SIGNIFICANT_ACCOU2

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended							12 Months Ended
	Dec. 31, 2014							Mar. 31, 2014
Accounting Policies [Abstract]
Share-based compensation		Nine Months			Nine Months			The following table summarizes share-based compensation expenses relating to shares and options granted and the effect on loss per common share during the years ended March 31, 2014 and 2013:
		Ended			Ended
		December 31,			December 31,				31-Mar-14			31-Mar-13
		2014			2013			Vesting of Stock Options	$	541,588		$	355,578
	Vesting of stock options	$	338,580		$	156,993		Incremental fair value of option Modifications		1,914			23,028
	Incremental fair value of option modifications		–			1,914		Vesting Expense Associated with CEO Restricted Stock Grant		64,444			386,667
	Vesting expense associated with CEO restricted stock grant		–			64,444		Total Stock-Based Compensation Expense	$	607,946		$	765,273
	Total stock-based compensation expense	$	338,580		$	223,351
								Basic and diluted loss per common share	$	(0.16	)	$	(0.26	)
	Weighted average number of common shares outstanding – basic and diluted		5,254,459			3,750,111
	Basic and diluted loss per common share associated with stock-based compensation expense	$	(0.06	)	$	(0.06	)
Research and development expenses		December 31,			December 31,
		2014			2013
	Three months ended	$	214,165		$	542,383
	Nine months ended	$	747,657		$	1,178,488

4_NOTES_PAYABLE_Tables

4. NOTES PAYABLE (Tables)	9 Months Ended									12 Months Ended
	Dec. 31, 2014									Mar. 31, 2014
Debt Disclosure [Abstract]
Schedule of notes payable		31-Dec-14				31-Mar-14				Notes payable consist of the following:
		Principal Balance		Accrued Interest		Principal Balance		Accrued Interest
	12% Notes payable	$	22,500	$	45,562	$	185,000	$	353,813		31-Mar-14					31-Mar-13
	10% Note payable		–		–		5,000		6,375		Principal Balance			Accrued Interest		Principal Balance		Accrued Interest
	Directors’ Note(s)		–		–		200,000		14,516	12% Notes payable, past due	$	185,000		$	353,813	$	185,000	$	326,062
	Total	$	22,500	$	45,562	$	390,000	$	374,704	10% Note payable, past due		5,000			6,375		5,000		5,875
										Directors’ Note(s)		200,000			14,516		–		–
										Tonaquint Note		–			–		131,381		1,629
										Total	$	390,000		$	374,704	$	321,381	$	333,566
Activity in Tonaquint Note										The following table shows the conversions into principal of the Tonaquint Note by fiscal year:
										Initial principal balance	$	360,186
										Lender’s legal fees		12,500
										Conversions during the fiscal year ended March 31, 2013		(241,305	)
										Conversions during the fiscal year ended March 31, 2014		(131,381	)
										Balance as of March 31, 2014	$	–

5_CONVERTIBLE_NOTES_PAYABLE_Ta

5. CONVERTIBLE NOTES PAYABLE (Tables)	9 Months Ended											12 Months Ended
	Dec. 31, 2014											Mar. 31, 2014
Convertible notes payable	Convertible Notes Payable consisted of the following at December 31, 2014:											Convertible Notes Payable consisted of the following at March 31, 2014:
		Principal			Unamortized			Net		Accrued			Principal			Unamortized			Net		Accrued
					Discount			Amount		Interest						Discount			Amount		Interest
	Convertible Notes Payable – Non-Current Portion:											Convertible Notes Payable – Current Portion:
	November 2014 10% Convertible Notes		527,780			(465,687	)		62,093		2,680	Amended and Restated Series A 12% Convertible Notes, past due	$	885,000		$	–		$	885,000	$	575,250
	April 2011 12% Convertible Notes		202,159			–			202,159		8,064	2008 10% Convertible Notes, past due		25,000			–			25,000		19,167
	Total – Convertible Notes Payable – Non-Current Portion		729,939			(465,687	)		264,252		10,744	October & November 2009 10% Convertible Notes		50,000			–			50,000		26,097
	Total Convertible Notes Payable	$	729,939		$	(465,687	)	$	264,252	$	10,744	April 2010 10% Convertible Note		75,000			–			75,000		31,438
												July and August 2011 10% Convertible Notes, past due		257,655			–			257,655		90,256
	Convertible Notes Payable consisted of the following at March 31, 2014:											Law Firm Note		75,000			–			75,000		7,604
												Total – Convertible Notes Payable – Current Portion		1,367,655			–			1,367,655		749,812
		Principal			Unamortized			Net		Accrued
					Discount			Amount		Interest		Convertible Notes Payable – Non-Current Portion:
	Convertible Notes Payable – Current Portion:											September 2010 12% Convertible Notes		317,072			–			317,072		35,034
	Amended and Restated Series A 12% Convertible Notes, past due	$	885,000		$	–		$	885,000	$	575,250	April 2011 12% Convertible Notes		448,448			–			448,448		12,117
	2008 10% Convertible Notes, past due		25,000			–			25,000		19,167	September 2011 12% Convertible Notes		10,931			–			10,931		-
	October & November 2009 10% Convertible Notes		50,000			–			50,000		26,097	Total – Convertible Notes Payable – Non-Current Portion		776,451			–			776,451		47,151
	April 2010 10% Convertible Note		75,000			–			75,000		31,438	Total Convertible Notes Payable	$	2,144,106		$	–		$	2,144,106	$	796,96
	July and August 2011 10% Convertible Notes, past due		257,655			–			257,655		90,256
	Law Firm Note		75,000			–			75,000		7,604	Convertible Notes Payable consisted of the following at March 31, 2013:
	Total – Convertible Notes Payable – Current Portion		1,367,655			–			1,367,655		749,812
													Principal			Unamortized			Net		Accrued
	Convertible Notes Payable – Non-Current Portion:															Discount			Amount		Interest
	September 2010 12% Convertible Notes		317,072			–			317,072		35,034	Amended and Restated Series A 12% Convertible Notes, past due	$	885,000		$	–		$	885,000	$	398,250
	April 2011 12% Convertible Notes		448,448			–			448,448		12,117	2008 10% Convertible Notes, past due		25,000			–			25,000		15,417
	September 2011 12% Convertible Notes		10,931			–			10,931		–	December 2006 10% Convertible Notes, past due		17,000			–			17,000		15,888
	Total – Convertible Notes Payable – Non-Current Portion		776,451			–			776,451		47,151	October & November 2009 10% Convertible Notes		50,000			(389	)		49,611		20,000
	Total Convertible Notes Payable	$	2,144,106		$	–		$	2,144,106	$	796,963	April 2010 10% Convertible Note		75,000			(3,895	)		71,105		23,938
												September 2010 10% Convertible Notes, past due		308,100			–			308,100		52,393
												April 2011 10% Convertible Notes, past due		400,400			–			400,400		100,100
												July and August 2011 10% Convertible Notes, $257,656 past due		357,655			–			357,655		68,704
												September 2011 Convertible Notes, past due		178,760			–			178,760		–
												Law Firm Note		75,000			–			75,000		3,854
												Total – Convertible Notes Payable	$	2,371,915		$	(4,284	)	$	2,367,631	$	698,544
Activity in Convertible Notes												The following table shows the conversions into principal of the October and November 2009 Convertible Notes by fiscal year:
												Activity in October & November 2009 10% Convertible Notes
												Initial principal balance	$	450,250
												Conversions during the fiscal year ended March 31, 2010		(70,000	)
												Conversions during the fiscal year ended March 31, 2011		(175,000	)
												Conversions during the fiscal year ended March 31, 2012		(130,250	)
												Conversions during the fiscal year ended March 31, 2013		(25,000	)
												Conversions during the fiscal year ended March 31, 2014		--
												Balance as of March 31, 2014	$	50,000
												The following table shows the activity in the September 2010 10% Convertible Notes by fiscal year:
												Activity in the September 2010 10% Convertible Notes
												Initial principal balance	$	743,600
												Conversions during the fiscal year ended March 31, 2012		(405,500	)
												Conversions during the fiscal year ended March 31, 2013		(30,000	)
												Conversions during the fiscal year ended March 31, 2014		(25,000	)
												Increase in principal balance due to 12% extension fee		33,972
												Balance as of March 31, 2014	$	317,072
												The following table shows the conversions into principal of the September 2011 Convertible Notes by fiscal year:
												Activity in the September 2011 Convertible Notes
												Initial principal balance	$	253,760
												Conversions during the fiscal year ended March 31, 2012		(15,000	)
												Conversions during the fiscal year ended March 31, 2013		(60,000	)
												Conversions during the fiscal year ended March 31, 2014		(169,000	)
												Increase in principal balance due to extension fee		1,171
												Balance as of March 31, 2014	$	10,931
April 2011 12% Convertible Notes
Activity in Convertible Notes	Activity in the April 2011 12% Convertible Notes
	Initial principal balance	$	400,400
	Increase in principal balance due to extension fee		48,048
	Conversions during the nine months ended December 31, 2014		(246,289	)
	Balance as of December 31, 2014	$	202,159
October and November 2009 10% Convertible Notes [Member]
Activity in Convertible Notes	Activity in October & November 2009 10% Convertible Notes
	Initial principal balance	$	450,250
	Conversions during the fiscal year ended March 31, 2010		(70,000	)
	Conversions during the fiscal year ended March 31, 2011		(175,000	)
	Conversions during the fiscal year ended March 31, 2012		(130,250	)
	Conversions during the fiscal year ended March 31, 2013		(25,000	)
	Conversions during the fiscal year ended March 31, 2014		-
	Conversions into equity unit structure during the nine months ended December 31, 2014		(50,000	)
	Balance as of December 31, 2014	$	–
September 2010 12% Convertible Notes [Member]
Activity in Convertible Notes	Activity in the September 2010 12% Convertible Notes
	Initial principal balance	$	743,600
	Conversions during the fiscal year ended March 31, 2012		(405,500	)
	Conversions during the fiscal year ended March 31, 2013		(30,000	)
	Conversions during the fiscal year ended March 31, 2014		(25,000	)
	Increase in principal balance due to 12% extension fee		33,972
	Conversions during the nine months ended December 31, 2014		(317,072	)
	Balance as of December 31, 2014	$	–
September 2011 12% Convertible Notes [Member]
Activity in Convertible Notes	Activity in the September 2011 Convertible Notes
	Initial principal balance	$	253,760
	Conversions during the fiscal year ended March 31, 2012		(15,000	)
	Conversions during the fiscal year ended March 31, 2013		(60,000	)
	Conversions during the fiscal year ended March 31, 2014		(169,000	)
	Increase in principal balance due to extension fee		1,171
	Conversions during the nine months ended December 31, 2014		(10,931	)
	Balance as of December 31, 2014	$	–

8_OTHER_CURRENT_LIABILITIES_Ta

8. OTHER CURRENT LIABILITIES (Tables)	9 Months Ended					12 Months Ended
	Dec. 31, 2014					Mar. 31, 2014
Other Liabilities Disclosure [Abstract]
Other Current Liabilities		December 31,		March 31,		Other current liabilities were comprised of the following items:
		2014		2014
	Accrued interest	$	56,306	$	1,165,335		March 31,		March 31,
	Accrued legal fees		–		179,465		2014		2013
	Accrued liquidated damages		362,800		362,800	Accrued interest	$	1,165,335	$	1,032,110
	Other accrued liabilities		21,313		147,774	Accrued legal fees		179,465		179,465
	Total other current liabilities	$	440,419	$	1,855,374	Accrued liquidated damages		362,800		437,800
						Other accrued liabilities		147,774		155,610
						Total other current liabilities	$	1,855,374	$	1,804,985

9_FAIR_VALUE_MEASUREMENTS_Tabl

9. FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

12 Months Ended

Dec. 31, 2014

Mar. 31, 2014

Fair Value Disclosures [Abstract]

Fair value measurements based on the valuation technique

Description

March 31,

Quoted Prices

Significant

Significant

The fair value of our recorded derivative liabilities is determined based on unobservable inputs that are not corroborated by market data, which is a Level 3 classification. We record derivative liabilities on our balance sheet at fair value with changes in fair value recorded in our consolidated statements of operations.  Our fair value measurements at the reporting date were as follows:

2014

in Active

Other

Unobservable

Markets for

Observable

(Level 3)

At March 31, 2014:

(Level 1)

(Level 2)

Description

Quoted Prices in

Significant Other

Significant

Derivative Liabilities

$

10,679,067

$

–

$

–

$

10,679,067

Active Markets for

Observable Inputs

Unobservable

Total Assets

$

10,679,067

$

–

$

–

$

10,679,067

Identical Assets

(Level 2)

Inputs (Level 3)

(Level 1)

Derivative Liabilities

$

–

$

–

$

10,679,067

Total Assets

$

–

$

–

$

10,679,067

At March 31, 2013:

Description

Quoted Prices in

Significant Other

Significant

Active Markets for

Observable Inputs

Unobservable

Identical Assets

(Level 2)

Inputs (Level 3)

(Level 1)

Derivative Liabilities

$

–

$

–

$

3,588,239

Total Assets

$

–

$

–

$

3,588,239

Significant weighted average assumptions used to estimate the fair value information utilizing the Binomial Lattice option pricing model

Nine Months Ended December 31, 2013

The following outlines the significant weighted average assumptions used to estimate the fair value information presented for the fiscal years ended March 31, 2014 and 2013, in connection with our April 2011 convertible note, July & August 2011 10% convertible notes and the September 2011 convertible note offerings and with respect to warrant and embedded conversion option derivative instruments utilizing the Binomial Lattice option pricing model:

Risk free interest rate

0.02% - 2.04%

Average expected life

0.25 – 3 years

Fiscal Year Ended March 31, 2014

Expected volatility

58.0% - 103.1%

Risk free interest rate

0.02% - 0.79%

Expected dividends

None

Average expected life

0.25 – 2.8 years

Expected volatility

58.0% - 103.1%

Expected dividends

None

Fiscal Year Ended March 31, 2013

Risk free interest rate

0.05% - 1.56%

Average expected life

0.25 – 3.6 years

Expected volatility

76.0% - 107.1%

Expected dividends

None

Summary of changes in the fair value of our Level 3 financial instruments

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the nine months ended December 31, 2014:

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the year ended March 31, 2014:

April 1,

Recorded New

Change in

Reclassification

December 31,

April 1,

Recorded New Derivative Liabilities

Change in estimated fair value recognized in results of operations

Reclassification of Derivative Liability to Paid in capital

March 31,

2014

Derivative

estimated

of Derivative

2014

2013

2014

Liabilities

fair value

Liability to Paid

recognized in

in capital

Derivative liabilities

$

3,588,239

$

–

$

5,729,780

$

1,361,048

$

10,679,067

results of

operations

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the year ended March 31, 2013:

Derivative liabilities

$

10,679,067

$

–

$

–

$

(10,679,067

)

$

–

April 1,

Recorded New Derivative Liabilities

Change in estimated fair value recognized in results of operations

Reclassification of Derivative Liability to Paid in capital

March 31,

2012

2013

The table below sets forth a summary of changes in the fair value of our Level 3 financial instruments for the nine months ended December 31, 2013:

Derivative liabilities

$

3,588,615

$

–

$

(44,705

)

$

44,329

$

3,588,239

April 1,

Recorded New Derivative

Change in

Reclassification

December 31,

2013

Liabilities

estimated

of Derivative

2013

fair value

Liability to Paid

recognized in

in capital

results of

operations

Derivative liabilities

$

3,588,239

$

–

$

2,304,702

$

(316,876

)

$

5,576,065

10_STOCK_COMPENSATION_Tables

10. STOCK COMPENSATION (Tables)	9 Months Ended														12 Months Ended
	Dec. 31, 2014														Mar. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Components of share-based compensation expenses relating to shares and options granted			Three Months Ended			Three Months Ended			Nine Months Ended			Nine Months Ended			Our total stock-based compensation for fiscal years ended March 31, 2014 and 2013 included the following:
			31-Dec-14			31-Dec-13			31-Dec-14			31-Dec-13
	Vesting of stock options			77,900			32,750			338,580			156,993				31-Mar-14				31-Mar-13
	Incremental fair value of option modifications			–			–			–			1,914		Vesting  of restricted stock grant		$	64,444			$	386,668
	Vesting expense associated with CEO restricted stock grant			–			–			–			64,444		Incremental fair value of option modifications			1,914				23,027
	Total share-based compensation expense		$	77,900		$	32,750		$	338,580		$	223,351		Vesting of stock options			541,588				355,578
															Total Stock-Based Compensation		$	607,946			$	765,273
	Total share-based compensation expense included in net loss		$	77,900		$	32,750		$	338,580		$	223,351
	Weighted average number of common shares outstanding – basic and diluted			6,032,126			3,963,066			5,254,459			3,750,111
	Basic and diluted loss per common share associated with stock-based compensation expense		$	(0.01	)	$	(0.01	)	$	(0.06	)	$	(0.06	)
Weighted average assumptions used to estimate the fair value information	The following outlines the significant weighted average assumptions used to estimate the fair value information presented, with respect to stock option grants utilizing the Binomial Lattice option pricing models at, and during the nine months ended December 31, 2014:														The following outlines the significant weighted average assumptions used to estimate the fair value with respect to stock options utilizing the Binomial Lattice option pricing model for the years ended March 31, 2014 and March 31, 2013:
	Risk free interest rate	2.60%														Year Ended March 31,
	Average expected life	10 years														2014		2013
	Expected volatility	90.23%													Risk free interest rate	0.38% to 2.65%		1.44%
	Expected dividends	None													Average expected life	3 to 10 years		10 years
															Expected volatility	91.05% to 102.67%		117.53%
	The following outlines the significant weighted average assumptions used to estimate the fair value information, which is based on historical data, with respect to stock option grants utilizing the Binomial Lattice option pricing models at, and during the nine months ended December 31, 2013:														Expected dividends	None		None
	Risk free interest rate	0.38% - 2.50%
	Average expected life	3 years - 10 years
	Expected volatility	94.6% - 102.7%
	Expected dividends	None
Options outstanding			Number of Options			Weighted Average Exercise Price			Weighted Average Remaining Contractual Term in Years						The following is a summary of the stock options outstanding at March 31, 2014 and 2013 and the changes during the years then ended:
	Vested			485,301		$	13			4.24							Year Ended March 31,
	Expected to vest			93,819		$	7			8.9							2014								2013
	Total			579,121													Options				Weighted Average				Options				Weighted Average
																					Exercise Price								Exercise Price
															Outstanding, beginning of year			421,916			$	14				388,574			$	15.5
															Granted			104,411			$	4.5				33,342			$	4
															Exercised			(3,659		)	$	4				–			$	–
															Cancelled/Forfeited			–			$	–				–			$	–
															Outstanding, end of year			522,668			$	12.5				421,916			$	14
															Exercisable, end of year			449,751			$	13.5				382,833			$	14.5
															Weighted average estimated fair value of options granted						$	6.5							$	4
Stock option activity			Number of Options			Range of			Weighted Average						The detail of the options outstanding and exercisable as of March 31, 2014 is as follows:
						Exercise Price			Exercise Price
	Stock options outstanding at March 31, 2014			522,668			$3.80 - $20.50		$	12.5									Options Outstanding												Options Exercisable
	Exercised			(1,000	)		9.5		$	9.5					Range of				Number				Weighted				Weighted				Number		Weighted
	Granted			59,453			9.5		$	9.5					Exercise Prices				Outstanding				Average				Average				Outstanding		Average
	Cancelled/Expired			(2,000	)		9.5		$	9.5													Remaining				Exercise						Exercise
	Stock options outstanding at December 31, 2014			579,121			$3.80 - $20.50		$	12													Life (Years)				Price						Price
	Stock options exercisable at December 31, 2014			485,301			$3.80 - $20.50		$	13					$4.00 - $5.50					134,094				9.68 years			$	4.5				64,094	$	4
															$10.50 - $12.50					224,143				4.28 years			$	12				221,226	$	12
															$18.00 - $20.50					164,431				2.68 years			$	19				164,431	$	19
																				522,668												449,751

11_WARRANTS_Tables

11. WARRANTS (Tables)	9 Months Ended									12 Months Ended
	Dec. 31, 2014									Mar. 31, 2014
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Summary of warrant activity			Amount			Range of		Weighted Average		A summary of the aggregate warrant activity for the years ended March 31, 2014 and 2013 is presented below:
						Exercise Price		Exercise Price
	Warrants outstanding at March 31, 2014			1,414,190			$2.10 - $12.50	$	6.5			Year Ended March 31,
	Exercised			(587,084	)		$2.10 – $11.00	$	4.5			2014					2013
	Issued			806,478			$2.10 - $15.00	$	8.5			Warrants			Weighted Average		Warrants			Weighted Average
	Cancelled/Expired			(197,692	)		$2.10 - $11.00	$	7.00						Exercise Price					Exercise Price
	Warrants outstanding at December 31, 2014			1,435,892			$2.10 - $15.00	$	7	Outstanding, beginning of year			1,512,946		$	5.5		1,196,157		$	7
	Warrants exercisable at December 31, 2014			1,435,892			$2.10 - $15.00	$	7	Granted			290,610		$	9		334,209		$	5.5
										Exercised			(254,324	)	$	4		–		$	–
										Cancelled/Forfeited			(135,042	)	$	5.5		(17,420	)	$	12.5
										Outstanding, end of year			1,414,190		$	5		1,512,946		$	5.5
										Exercisable, end of year			1,414,190		$	5		1,512,946		$	5.5
										Weighted average estimated fair value of warrants granted					$	4.5				$	3.5
Weighted average assumptions used to estimate the fair value, with respect to warrants utilizing the Binomial Lattice option pricing model	Risk free interest rate	0.79% - 2.29%								The following outlines the significant weighted average assumptions used to estimate the fair value of warrants granted utilizing the Binomial Lattice option pricing model:
	Average expected life	5 years – 7 years
	Expected volatility	87.8% - 107.4%									Year Ended March 31,
	Expected dividends	None									2014		2013
										Risk free interest rate	1.3%-2.04%		0.86%-1.56%
										Average expected life	5 to 7 years		5 to 7 years
										Expected volatility	91.2% - 98.5%		90.3% - 94.3%
										Expected dividends	None		None
Warrants outstanding and exerceisable										The detail of the warrants outstanding and exercisable as of March 31, 2014 is as follows:
												Warrants Outstanding								Warrants Exercisable
										Range of		Number			Weighted Average		Weighted Average			Number		Weighted Average
										Exercise Prices		Outstanding			Remaining		Exercise Price			Outstanding		Exercise Price
															Life (Years)
										$5.00 or Below			741,896			2.42	$	2.5			741,896	$	2.5
										$5.50 - $9.50			437,520			4.74	$	6.5			437,520	$	6.5
										$10.00 - $12.50			234,774			5.05	$	10.5			234,774	$	10.5
													1,414,190								1,414,190

14_SEGMENTS_Tables

14. SEGMENTS (Tables)	9 Months Ended							12 Months Ended
	Dec. 31, 2014							Mar. 31, 2014
Segment Reporting [Abstract]
Segment reporting		Nine Months Ended						The following tables set forth certain information regarding our segments and other operations that conforms to the consolidated balance sheet and statement of operations presented in this Report:
		December 31,
		2014			2013				Fiscal Years Ended March 31,
	Revenues:								2014			2013
	Aethlon	$	563,805		$	916,796		Revenues:
	Exosome Sciences, Inc.		–			–		Aethlon	$	1,623,769		$	1,230,004
	Total Revenues	$	563,805		$	916,796		ESI		–			–
								Total Revenues	$	1,623,769		$	1,230,004
	Operating Losses:
	Aethlon	$	(2,156,769	)	$	(2,065,212	)	Operating Losses:
	Exosome Sciences, Inc.		(703,411	)		(180,722	)	Aethlon	$	(2,651,863	)	$	(3,575,354	)
	Total Operating Loss	$	(2,860,180	)	$	(2,245,934	)	ESI		(404,065	)		–
								Total Operating Loss	$	(3,055,928	)	$	(3,575,354	)
	Net Losses:
	Aethlon	$	(5,347,716	)	$	(5,735,474	)	Net Losses:
	Exosome Sciences, Inc.		(703,411	)		(185,305	)	Aethlon	$	(13,357,232	)	$	(4,892,040	)
	Net Loss Before Non-Controlling Interests	$	(6,051,127	)	$	(5,920,779	)	ESI		(81,730	)		–
								Net Loss Before Non-Controlling Interests	$	(13,438,962	)	$	(4,892,040	)
	Cash:
	Aethlon	$	2,446,820		$	588,066		Cash:
	Exosome Sciences, Inc.		328,915			1,266,875		Aethlon	$	208,259		$	125,274
	Total Cash	$	2,775,735		$	1,854,941		ESI		1,042,020			–
								Total Cash	$	1,250,279		$	125,274
	Total Assets:
	Aethlon	$	2,735,913		$	777,004		Total Assets:
	Exosome Sciences, Inc.		420,582			1,328,004		Aethlon	$	597,026		$	496,694
	Total Assets	$	3,156,495		$	2,105,008		ESI		1,098,076			–
								Total Assets	$	1,695,102		$	496,694
	Capital Expenditures:
	Aethlon	$	–		$	2,750		Capital Expenditures:
	Exosome Sciences, Inc.		–			58,743		Aethlon	$	37,313		$	–
	Capital Expenditures	$	–		$	61,493		ESI		58,743			–
								Capital Expenditures	$	96,056		$	–
	Depreciation and Amortization:
	Aethlon	$	13,328		$	7,195		Depreciation and Amortization:
	Exosome Sciences, Inc.		14,686			6,964		Aethlon	$	11,549		$	10,484
	Total Depreciation and Amortization	$	28,014		$	14,159		ESI		9,538			–
								Total Depreciation and Amortization	$	21,087		$	10,484
	Interest Expense:
	Aethlon	$	285,229		$	325,364		Interest Expense:
	Exosome Sciences, Inc.		–			4,583		Aethlon	$	1,282,638		$	1,132,314
	Total Interest Expense	$	285,229		$	329,947		ESI		4,583			–
								Total Interest Expense	$	1,287,221		$	1,132,314

2_PROPERTY_AND_EQUIPMENT_Table

2. PROPERTY AND EQUIPMENT (Tables)	12 Months Ended
	Mar. 31, 2014
Property, Plant and Equipment [Abstract]
Sumarry of Property and equipment	Property and equipment, net, consist of the following:
		31-Mar-14			31-Mar-13
	Furniture and office equipment, at cost	$	385,088		$	289,031
	Accumulated depreciation		(300,809	)		(288,886	)
		$	84,279		$	145

3_PATENTS_Tables

3. PATENTS (Tables)	12 Months Ended
	Mar. 31, 2014
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule for Patents	Patents consist of the following:
		31-Mar-14			31-Mar-13
	Patents	$	157,442		$	157,442
	Patents pending and trademarks		54,203			54,203
	Accumulated amortization		(99,156	)		(89,992	)
		$	112,489		$	121,653

9_INCOME_TAXES_Tables

9. INCOME TAXES (Tables)	12 Months Ended
	Mar. 31, 2014
Income Taxes Tables
Significant components of our net deferred tax assets	Significant components of our net deferred tax assets at March 31, 2014 and 2013 are shown below:
		YEAR ENDED MARCH 31,
		2014			2013
	Deferred tax assets:
	Capitalized research and development	$	3,442,000		$	3,442,000
	Net operating loss carryforwards		15,193,000			14,793,000
	Total deferred tax assets		18,635,000			18,235,000
	Total deferred tax liabilities		–			–
	Net deferred tax assets		18,635,000			18,235,000
	Valuation allowance for deferred tax assets		(18,635,000	)		(18,235,000	)
	Net deferred tax assets	$	–		$	–
Provision for income taxes on earnings subject to income taxes differs from the statutory federal rate	The provision for income taxes on earnings subject to income taxes differs from the statutory federal rate for the years ended March 31, 2014 and 2013 due to the following:
		2014			2013
	Income taxes (benefit) at federal statutory rate of 34%	$	(4,541,000	)	$	(1,663,000	)
	State income tax, net of federal benefit		(156,000	)		(285,000	)
	Tax effect on non-deductible expenses and credits		4,297,000			215,000
	Change in valuation allowance1		400,000			1,733,000
		$	–		$	–

13_COMMITMENTS_AND_CONTINGENCI1

13. COMMITMENTS AND CONTINGENCIES (Tables)	12 Months Ended
	Mar. 31, 2014
Commitments and Contingencies Disclosure [Abstract]
Commitments under the lease agreements	As of March 31, 2014, commitments under the lease agreements are as follows:
		2015
	8910 University Center Lane, Suite 660, San Diego, CA 92122 office lease	$	43,795
	11585 Sorrento Valley Road, Suite 109, San Diego, California 92121 office lease		22,755
	11 Deer Park Drive, South Brunswick, NJ		23,975
	Total Lease Commitments	$	90,525

2_LIQUIDITY_Details_Narrative

2. LIQUIDITY (Details Narrative) (USD $)	9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
LiquidityDetailsAbstract
Accumulated deficit	($80,743,001)		($74,832,557)	($61,475,325)
Derivative liability reclassified into equity	10,679,067	316,876	1,456,187	45,081
Proceeds from issuance of common stock	4,763,153	3,175,032	3,177,032	2,109,834
Proceeds from issuance of convertible notes	$415,000

3_SUMMARY_OF_SIGNIFICANT_ACCOU3

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Share-based compensation expense) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Total Stock-Based Compensation Expense	$77,900	$32,750	$338,580	$223,351	$607,946	$765,273
Weighted average number of common shares outstanding - basic and diluted	6,032,126	3,963,066	5,254,459	3,750,111	3,881,179	2,984,472
Basic and diluted loss per common share	($0.01)	($0.01)	($0.06)	($0.06)
Vesting of Stock Options [Member]
Total Stock-Based Compensation Expense	77,900	32,750	338,580	156,993
Incremental fair value of option modifications [Member]
Total Stock-Based Compensation Expense	0	0	0	1,914
Vesting Expense Associated with CEO Restricted Stock Grant [Member]
Total Stock-Based Compensation Expense	$0	$0	$0	$64,444

3_SUMMARY_OF_SIGNIFICANT_ACCOU4

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details - Research and Development) (USD $)	3 Months Ended		9 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013
Accounting Policies [Abstract]
Research and development expenses	$214,165	$542,383	$747,657	$1,178,488

3_SUMMARY_OF_SIGNIFICANT_ACCOU5

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) (USD $)	9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Cash uninsured amount	$2,275,000
Potentially antidilutive shares excluded from EPS	2,205,525	2,902,111	2,861,492	2,854,024
Amortization of deferred offering costs	68,982	863	863	127,200
Sales Revenue, Net [Member]
Concentration risk percentage	100.00%	100.00%	100.00%	100.00%
Accounts Receivable, Net [Member]
Concentration risk percentage	100.00%	100.00%	100.00%	100.00%
Exosome Sciences, Inc.
Stock sold, shares issued	300,000	300,000	300,000
Stock sold, amount	$1,500,000	$1,500,000	$1,500,000
Ownership percentage	80.00%	80.00%	80.00%	80.00%

4_NOTES_PAYABLE_Details_Notes_

4. NOTES PAYABLE (Details - Notes payable) (USD $)	Dec. 31, 2014	Mar. 31, 2014	Mar. 31, 2013
Principal Balance	$22,500	$390,000	$321,381
Accrued Interest on notes payable	45,562	374,704
12% Notes Payable [Member]
Principal Balance	22,500	185,000
Accrued Interest on notes payable	45,562	353,813
10% Note payable [Member]
Principal Balance	0	5,000
Accrued Interest on notes payable	0	6,375
Directors Notes [Member]
Principal Balance	0	200,000
Accrued Interest on notes payable	$0	$14,516

4_NOTES_PAYABLE_Details_Narrat

4. NOTES PAYABLE (Details Narrative) (USD $)	9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Interest expense related to notes payable	$27,021
Principal Balance	22,500		390,000	321,381
Repayments on notes payable	500,920	200,000	217,000	29,610
Accrued Interest on notes payable	45,562		374,704
Stock issued in conversion of note, value			726,776	1,695,059
12% Notes Payable [Member]
Principal Balance	22,500		185,000
Repayments on notes payable	162,500
Repayments of accrued interest	329,062
Accrued Interest on notes payable	45,562		353,813
10% Note payable [Member]
Principal Balance	0		5,000
Repayments on notes payable	5,000
Repayments of accrued interest	6,750
Accrued Interest on notes payable	0		6,375
Directors Notes [Member]
Principal Balance	0		200,000
Accrued Interest on notes payable	0		14,516
Stock issued in conversion of note, shares issued	50,079
Stock issued in conversion of note, value	$220,349

5_CONVERTIBLE_NOTES_PAYABLE_De

5. CONVERTIBLE NOTES PAYABLE (Details) (USD $)	Dec. 31, 2014	Mar. 31, 2014	Mar. 31, 2013
Convertible Notes Payable - Principal current portion	$0	$1,367,655
Unamortized discount - current portion	0	0
Convertible Notes Payable, net - current portion	0	1,367,655	2,367,631
Accrued interest - current portion		749,812
Convertible Notes Payable - Principal, non-current portion	729,939	776,451
Unamortized discount - Non-current portion	-465,687	0
Convertible Notes Payable, net - Non-Current Portion	264,252	776,451	0
Accrued interest - non-current portion	10,744	47,151
Total Convertible Notes Payable - Principal current and noncurrent	729,939	2,144,106
Total Unamortized Discount	-465,687	0
Total Convertible Notes Payable, net	264,252	2,144,106
Total Accrued Interest	10,744	796,963
November 2014 10% Convertible notes
Convertible Notes Payable - Principal, non-current portion	527,780
Unamortized discount - Non-current portion	-465,687
Convertible Notes Payable, net - Non-Current Portion	62,093
Accrued interest - non-current portion	2,680
April 2011 12% Convertible Notes [Member]
Convertible Notes Payable - Principal, non-current portion	202,159	448,448
Unamortized discount - Non-current portion	0	0
Convertible Notes Payable, net - Non-Current Portion	202,159	448,448
Accrued interest - non-current portion	8,064	12,117
Amended and Restated Series A 12% Convertible notes [Member]
Convertible Notes Payable - Principal current portion		885,000
Unamortized discount - current portion		0
Convertible Notes Payable, net - current portion		885,000
Accrued interest - current portion		575,250
2008 10% Convertible Notes [Member]
Convertible Notes Payable - Principal current portion		25,000
Unamortized discount - current portion		0
Convertible Notes Payable, net - current portion		25,000
Accrued interest - current portion		19,167
October and November 2009 10% Convertible Notes [Member]
Convertible Notes Payable - Principal current portion		50,000
Unamortized discount - current portion		0
Convertible Notes Payable, net - current portion		50,000
Accrued interest - current portion		26,097
April 2010 10% Convertible Note [Member]
Convertible Notes Payable - Principal current portion		75,000
Unamortized discount - current portion		0
Convertible Notes Payable, net - current portion		75,000
Accrued interest - current portion		31,438
July and August 2011 10% Convertible Notes [Member]
Convertible Notes Payable - Principal current portion		257,655
Unamortized discount - current portion		0
Convertible Notes Payable, net - current portion		257,655
Accrued interest - current portion		90,256
Law Firm Note [Member]
Convertible Notes Payable - Principal current portion		75,000
Unamortized discount - current portion		0
Convertible Notes Payable, net - current portion		75,000
Accrued interest - current portion		7,604
September 2010 12% Convertible Notes [Member]
Convertible Notes Payable - Principal, non-current portion		317,072
Unamortized discount - Non-current portion		0
Convertible Notes Payable, net - Non-Current Portion		317,072
Accrued interest - non-current portion		35,034
September 2011 12% Convertible Notes [Member]
Convertible Notes Payable - Principal, non-current portion		10,931
Unamortized discount - Non-current portion		0
Convertible Notes Payable, net - Non-Current Portion		10,931
Accrued interest - non-current portion		$0

5_CONVERTIBLE_NOTES_PAYABLE_De1

5. CONVERTIBLE NOTES PAYABLE (Details - Activity) (USD $)	9 Months Ended	12 Months Ended
	Dec. 31, 2014	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2012	Mar. 31, 2011	Mar. 31, 2010
Conversions during the period		($726,776)	($1,695,059)
April 2011 12% Convertible Notes [Member]
Initial principal balance	400,400
Increase in principal balance due to extension fee	48,048
Conversions during the period	-246,289
Balance as of December 31, 2014	202,159
October and November 2009 10% Convertible Notes [Member]
Initial principal balance	450,250
Conversions during the period	-50,000	0	-25,000	-130,250	-175,000	-70,000
Balance as of December 31, 2014	0
September 2010 12% Convertible Notes [Member]
Initial principal balance	743,600
Increase in principal balance due to extension fee	33,972
Conversions during the period	-317,072	-25,000	-30,000	-405,500
Balance as of December 31, 2014	0
September 2011 12% Convertible Notes [Member]
Initial principal balance	253,760
Increase in principal balance due to extension fee	1,171
Conversions during the period	-10,931	-169,000	-60,000	-15,000
Balance as of December 31, 2014	$0

5_CONVERTIBLE_NOTES_PAYABLE_De2

5. CONVERTIBLE NOTES PAYABLE (Details Narrative) (USD $)	9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Convertible Notes Payable [Abstract]
Interest expense	$123,305
Amortization of deferred finance fees	68,982	863	863	127,200
Amortization of note discounts	62,092
Total interest expense allocated to convertible notes	$254,379

6_EQUITY_TRANSACTIONS_Details_

6. EQUITY TRANSACTIONS (Details Narrative) (USD $)	3 Months Ended				9 Months Ended		12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Stock issued subscribed, shares issued			43,849
Warants issued			21,924
Proceeds from subscription and warrants			$320,800
Proceeds from convertible notes					415,000
Stock issued upon conversion of warrants, shares issued	430,333
Stock issued for services, shares issued	7,486	7,199	4,383
Stock issued for services, amount	54,800	49,090	38,268				392,093	259,035
Stock issued in exchange of note, amount							726,776	1,695,059
Repayment of note payable					500,920	200,000	217,000	29,610
Restricted common stock issued, shares	780	7,806
Restricted common stock issued, amount	8,000	75,000
Loss on debt conversion	-222,939			0	-2,754,062	-40,256	-40,257	-139,839
Stock options exercised, shares exercised	1,000
Proceeds from options exercised	9,500
Four investors [Member]
Warants issued		53,465
Restricted common stock issued, shares		53,465
Restricted common stock issued, amount		259,474
Three investors [Member]
Restricted common stock issued, amount		90,000
Common stock and warrants issued		19,500
Two investors [Member]
Proceeds from convertible notes	415,000
Stock issued in exchange of note, shares issued	284,745
Stock issued in exchange of note, amount	597,965
One Investor
Stock issued in exchange of note, shares issued	36,716
Stock issued in exchange of note, amount	189,087
Eight investors [Member]
Warants issued	113,422
December Financing
Proceeds from equity financing	3,001,428
Series A 12 Convertible Notes [Member] | Holder One [Member]
Stock issued in exchange of note, shares issued			314,286
Stock issued in exchange of note, amount			660,000
Series A 12 Convertible Notes [Member] | Holder Two [Member]
Stock issued in exchange of note, shares issued			51,837
Stock issued in exchange of note, amount			116,970
2008 10% Convertible Notes [Member] | Holder One [Member]
Restricted common stock issued, amount		220,349
2008 10% Convertible Notes [Member] | Holder Two [Member]
Restricted common stock issued, shares		9,564
Restricted common stock issued, amount		45,906
Loss on debt conversion		-65,493
Law Firm Note [Member]
Stock issued in exchange of note, shares issued	3,400
Repayment of note payable	50,000
2010 Convertible Notes
Stock issued in exchange of note, shares issued	112,500
Stock issued in exchange of note, amount	$225,000

8_OTHER_CURRENT_LIABILITIES_De

8. OTHER CURRENT LIABILITIES (Details) (USD $)	Dec. 31, 2014	Mar. 31, 2014	Mar. 31, 2013
Other Liabilities, Current [Abstract]
Accrued interest	$56,306	$1,165,335
Accrued legal fees	0	179,465
Accrued liquidated damages	362,800	362,800
Other accrued liabilities	21,313	147,774
Total other current liabilities	$440,419	$1,855,374	$1,804,985

9_FAIR_VALUE_MEASUREMENTS_Deta

9. FAIR VALUE MEASUREMENTS (Details - Fair value) (USD $)	Dec. 31, 2014	Mar. 31, 2014	Dec. 31, 2013	Mar. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liabilities		$10,679,067
Total Assets		10,679,067
Fair Value Inputs Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liabilities		0
Total Assets		0
Fair Value Inputs Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liabilities		0
Total Assets		0
Fair Value Inputs Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative Liabilities	0	10,679,067	5,576,065	3,588,239
Total Assets		$10,679,067

9_FAIR_VALUE_MEASUREMENT_Detai

9. FAIR VALUE MEASUREMENT (Details - Assumptions)	9 Months Ended
	Dec. 31, 2014
Warrants [Member] | Minimum [Member]
Fair Value Assumptions and Methodology for Assets and Liabilities
Risk free interest rate	0.02%
Average expected life	3 months
Expected volatility	58.00%
Warrants [Member] | Maximum [Member]
Fair Value Assumptions and Methodology for Assets and Liabilities
Risk free interest rate	2.04%
Average expected life	3 years
Expected volatility	103.10%
Fair Value Inputs Level 3 [Member]
Fair Value Assumptions and Methodology for Assets and Liabilities
Expected dividends	0.00%

9_FAIR_VALUE_MEASUREMENT_Detai1

9. FAIR VALUE MEASUREMENT (Details - Level 3) (USD $)	9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Derivative liabilities, beginning balance	$10,679,067
Reclassification of derivative liability to paid in capital	10,679,067	316,876	1,456,187	45,081
Derivative liabilities, ending balance			10,679,067
Fair Value Inputs Level 3 [Member]
Derivative liabilities, beginning balance	10,679,067	3,588,239	3,588,239
Recorded new derivative liabilities	0	0
Change in estimated fair value recognized in results of operations	0	2,304,702
Reclassification of derivative liability to paid in capital	-10,679,067	-316,876
Derivative liabilities, ending balance	$0	$5,576,065

10_STOCK_COMPENSATION_Details_

10. STOCK COMPENSATION (Details - Share-based compensation) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013
Total Stock-Based Compensation Expense	$77,900	$32,750	$338,580	$223,351	$607,946	$765,273
Total share-based compensation expense included in net loss	77,900	32,750	338,580	223,351
Weighted average number of common shares outstanding - basic and diluted	6,032,126	3,963,066	5,254,459	3,750,111	3,881,179	2,984,472
Basic and diluted loss per common share	($0.01)	($0.01)	($0.06)	($0.06)
Vesting of Stock Options [Member]
Total Stock-Based Compensation Expense	77,900	32,750	338,580	156,993
Incremental fair value of option modifications [Member]
Total Stock-Based Compensation Expense	0	0	0	1,914
Vesting Expense Associated with CEO Restricted Stock Grant [Member]
Total Stock-Based Compensation Expense	$0	$0	$0	$64,444

10_STOCK_COMPENSATION_Details_1

10. STOCK COMPENSATION (Details - Assumptions) (Stock Options [Member], USD $)	9 Months Ended
	Dec. 31, 2014
Risk free interest rate	2.60%
Average expected life	10 years
Expected volatility	90.23%
Expected dividends	$0
Minimum [Member]
Risk free interest rate	0.38%
Average expected life	3 years
Expected volatility	94.60%
Expected dividends	0
Maximum [Member]
Risk free interest rate	2.50%
Average expected life	10 years
Expected volatility	102.70%
Expected dividends	$0

10_STOCK_COMPENSATION_Details_2

10. STOCK COMPENSATION (Details - Option information) (Stock Options [Member], USD $)	9 Months Ended
	Dec. 31, 2014	Mar. 31, 2014
Stock Options [Member]
Number of Shares, Vested	485,301
Weighted Average Exercise Price, Vested	$13
Weighted Average Remaining Contractual Term in Years, Vested	4 years 2 months 26 days
Number of Shares, Expected to vest	93,819
Weighted Average Exercise Price, Expected to vest	$7
Weighted Average Remaining Contractual Term in Years, Expected to vest	8 years 10 months 24 days
Number of Shares	579,121	522,668

10_STOCK_COMPENSATION_Details_3

10. STOCK COMPENSATION (Details - Option activity) (USD $)	3 Months Ended	9 Months Ended
	Dec. 31, 2014	Dec. 31, 2014
Amount
Exercised	-1,000
Stock Options [Member]
Amount
Stock options outstanding beginning		522,668
Exercised		-1,000
Granted		59,453
Cancelled/Expired		-2,000
Stock options outstanding ending	579,121	579,121
Stock options exercisable	485,301	485,301
Range of Exercise Price
Stock options outstanding Minimum beginning		$3.80
Stock options outstanding at Maximum beginning		$20.50
Exercised		$9.50
Granted		$9.50
Cancelled/Expired		$9.50
Stock options outstanding Minimum ending	3.8	$3.80
Stock options outstanding Maximum ending	20.5	$20.50
Stock options exercisable Minimum ending	3.8	$3.80
Stock options exercisable Maximum ending	20.5	$20.50
Weighted Average Exercise Price
Stock options outstanding beginning		$12.50
Exercised		$9.50
Granted		$9.50
Cancelled/Expired		$9.50
Stock options outstanding ending	12	$12
Stock options exercisable ending	13	$13

10_STOCK_COMPENSATION_Details_4

10. STOCK COMPENSATION (Details Narrative) (USD $)	9 Months Ended
	Dec. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Unrecognized compensation cost	$419,883
Weighted average period for recognition of unrecognized compensation cost	1 year 4 months 6 days
Intrinsic value	$12
Aggregate intrinsic value	$868,681

11_WARRANTS_Details_Warrant_ac

11. WARRANTS (Details - Warrant activity) (Warrants [Member], USD $)	9 Months Ended
	Dec. 31, 2014
Warrants [Member]
Summary Of Warrant Activity [Abstract]
Warrants Outstanding	1,414,190
Warrants Exercised	-587,084
Warrants Issued	806,478
Warrants Cancelled/Expired	-197,692
Warrants outstanding	1,435,892
Warrants exercisable	1,435,892
Range of Exercise Price
Warrants outstanding, beginning - Range of Exercise Price Minimum	$2.10
Warrants outstanding, beginning - Range of Exercise Price Maximum	$12.50
Warrants Exercised - Range of Exercise Price Minimum	$2.10
Warrants Exercised - Range of Exercise Price Maximum	$11
Warrants Issued - Range of Exercise Price Minimum	$2.10
Warrants Issued - Range of Exercise Price Maximum	$15
Warrants Cancelled/Expired - Range of Exercise Price	$2.10
Warrants Cancelled/Expired - Range of Exercise Price Maximum	$11
Warrants outstanding, ending - Range of Exercise Price Minimum	$2.10
Warrants outstanding, ending - Range of Exercise Price Maximum	$15
Warrants Exercisable, ending - Range of Exercise Price Minimum	$2.10
Warrants Exercisable, ending - Range of Exercise Price Maximum	$15
Weighted Average Exercise Price
Warrants outstanding Weighted Average Exercise Price	$6.50
Warrants Exercised Weighted Average Exercise Price	$4.50
Warrants Issued Weighted Average Exercise Price	$8.50
Warrants Cancelled/Expired Weighted Average Exercise Price	$7
Warrants outstanding Weighted Average Exercise Price, ending	$7
Warrants exercisable Weighted Average Exercise Price	$7

11_WARRANTS_Details_Assumption

11. WARRANTS (Details - Assumptions) (Warrants [Member], USD $)	9 Months Ended
	Dec. 31, 2014
Expected dividends	$0
Minimum [Member]
Risk free interest rate	0.79%
Average expected life	5 years
Expected Volatility Rate	87.80%
Maximum [Member]
Risk free interest rate	2.29%
Average expected life	7 years
Expected Volatility Rate	107.40%

12_DARPA_CONTRACT_AND_RELATED_1

12. DARPA CONTRACT AND RELATED REVENUE RECOGNITION (Details Narrative) (USD $)	9 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Contract revenue	$444,723	$808,739
Number Of Milestones Under Year One Contract	3
Number Of Milestones Achieved Under Year One Contract		4
Milestone 2.4.2.2 [Member]
Revenue Recognition, Milestone Method, Revenue Recognized	197,362
MileStone 2.4.2.4 [Member]
Revenue Recognition, Milestone Method, Revenue Recognized	50,000
Milestone M9 [Member]
Revenue Recognition, Milestone Method, Revenue Recognized	197,361
MileStone 2.3.2.2 [Member]
Revenue Recognition, Milestone Method, Revenue Recognized		195,581
MileStone 2.3.2.2 2nd one [Member]
Revenue Recognition, Milestone Method, Revenue Recognized		195,581
MileStone 2.3.3.2 [Member]
Revenue Recognition, Milestone Method, Revenue Recognized		208,781
Milestone M5 [Member]
Revenue Recognition, Milestone Method, Revenue Recognized		$208,781

13_COMMITMENTS_AND_CONTINGENCI2

13. COMMITMENTS AND CONTINGENCIES (Details Narrative) (USD $)	9 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Commitments and Contingencies Disclosure [Abstract]
Rent expense	$127,000	$99,000

14_SEGMENTS_Details

14. SEGMENTS (Details) (USD $)	3 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2014	Mar. 31, 2013	Mar. 31, 2012
Revenues	$33,434	$76,313	$563,805	$916,796	$1,623,769	$1,230,004
Operating losses	-1,086,980	-1,232,342	-2,860,180	-2,245,934	-3,055,928	-3,575,354
Net losses	-1,602,005	-2,267,611	-6,051,127	-5,920,779	-13,438,962	-4,892,040
Cash	2,775,735	1,854,941	2,775,735	1,854,941	1,250,279	125,274	143,907
Total assets	3,156,495	2,105,008	3,156,495	2,105,008	1,695,102	496,694
Capital expenditures			0	61,493
Depreciation and amortization			28,014	14,159
Interest expense			285,229	329,947
Aethlon [Member]
Revenues			563,805	916,796
Operating losses			-2,156,769	-2,065,212
Net losses			-5,347,716	-5,735,474
Cash	2,446,820	588,066	2,446,820	588,066
Total assets	2,735,913	777,004	2,735,913	777,004
Capital expenditures			0	2,750
Depreciation and amortization			13,328	7,195
Interest expense			285,229	325,364
Exosome Sciences, Inc.
Revenues			0	0
Operating losses			-703,411	-180,722
Net losses			-703,411	-185,305
Cash	328,915	1,266,875	328,915	1,266,875
Total assets	420,582	1,328,004	420,582	1,328,004
Capital expenditures			0	58,743
Depreciation and amortization			14,686	6,964
Interest expense			$0	$4,583