Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2022 | May 11, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2022 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2022 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 001-38286 | |
Entity Registrant Name | ENVERIC BIOSCIENCES, INC. | |
Entity Central Index Key | 0000890821 | |
Entity Tax Identification Number | 95-4484725 | |
Entity Incorporation, State or Country Code | DE | |
Entity Address, Address Line One | 4851 Tamiami Trail N | |
Entity Address, Address Line Two | Suite 200 | |
Entity Address, City or Town | Naples | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 34103 | |
City Area Code | (239) | |
Local Phone Number | 302-1707 | |
Title of 12(b) Security | Common Stock, $0.01 par value per share | |
Trading Symbol | ENVB | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 52,684,548 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash | $ 21,694,535 | $ 17,355,999 |
Prepaid expenses and other current assets | 970,899 | 380,838 |
Total current assets | 22,665,434 | 17,736,837 |
Other assets: | ||
Property and equipment, net | 776,793 | 294,430 |
Right-of-use operating lease asset | 151,317 | 176,304 |
Intangible assets, net | 6,974,688 | 6,923,928 |
Goodwill | 1,610,780 | 1,587,634 |
Total other assets | 9,513,578 | 8,982,296 |
Total assets | 32,179,012 | 26,719,133 |
Current liabilities: | ||
Accounts payable | 1,218,298 | 683,393 |
Accrued liabilities | 764,022 | 1,292,721 |
Current portion of right-of-use operating lease obligation | 111,200 | 107,442 |
Total current liabilities | 2,093,520 | 2,083,556 |
Non-current liabilities: | ||
Non-current portion of right-of-use operating lease obligation | 40,117 | 68,861 |
Deferred tax liability | 1,630,552 | 1,607,122 |
Warrant liability | 3,973,125 | 653,674 |
Total non-current liabilities | 5,643,794 | 2,329,657 |
Total liabilities | 7,737,314 | 4,413,213 |
Commitments and contingencies (Note 6) | ||
Shareholders’ equity | ||
Preferred stock, $0.01 par value, 20,000,000 shares authorized; Series B preferred stock, $0.01 par value, 3,600,000 shares authorized, 0 shares issued and outstanding as of March 31, 2022 and December 31, 2021 | ||
Common stock, $0.01 par value, 100,000,000 shares authorized, 52,623,407 and 32,578,475 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively | 526,234 | 325,785 |
Additional paid-in capital | 89,118,024 | 82,747,390 |
Accumulated deficit | (65,260,467) | (60,736,453) |
Accumulated other comprehensive income (loss) | 57,907 | (30,802) |
Total stockholders’ equity | 24,441,698 | 22,305,920 |
Total liabilities and shareholders’ equity | $ 32,179,012 | $ 26,719,133 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2022 | Dec. 31, 2021 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, shares issued | 52,623,407 | 32,578,475 |
Common stock, shares outstanding | 52,623,407 | 32,578,475 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 3,600,000 | 3,600,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Operating expenses | ||
General and administrative | $ 2,767,866 | $ 6,470,405 |
Research and development | 1,958,714 | 157,952 |
Depreciation and amortization | 69,265 | 136,640 |
Total operating expenses | 4,795,845 | 6,764,997 |
Loss from operations | (4,795,845) | (6,764,997) |
Other income (expense) | ||
Inducement expense | (298,714) | |
Change in fair value of warrant liabilities | 275,969 | 3,813,000 |
Interest expense | (4,138) | |
Total other income | 271,831 | 3,514,286 |
Net loss | (4,524,014) | (3,250,711) |
Other comprehensive gain | ||
Foreign currency translation | 88,709 | 35,736 |
Comprehensive loss | $ (4,435,305) | $ (3,214,975) |
Net loss per share - basic and diluted | $ (0.11) | $ (0.20) |
Weighted average shares outstanding, basic and diluted | 42,356,752 | 16,220,661 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) | Preferred Stock [Member]Series B Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Total |
Beginning balance, value at Dec. 31, 2020 | $ 32,754 | $ 100,951 | $ 15,222,770 | $ (11,759,557) | $ (181,277) | $ 3,415,641 |
Beginning balance, shares at Dec. 31, 2020 | 3,275,407 | 10,095,109 | ||||
January 2021 registered direct offering | $ 22,213 | 4,594,874 | 4,617,087 | |||
January 2021 registered direct offering, shares | 2,221,334 | |||||
February 2021 registered direct offering | $ 30,070 | 6,986,331 | 7,016,401 | |||
February 2021 registered direct offering, shares | 3,007,026 | |||||
Stock-based compensation | 3,591,565 | 3,591,565 | ||||
Induced conversion of stock options into restricted stock awards | 298,714 | 298,714 | ||||
Conversion of Series B Preferred Stock | $ (32,754) | $ 32,754 | ||||
Conversion of series B preferred stock, shares | (3,275,407) | 3,275,407 | ||||
Exercise of warrants | $ 8,511 | 3,258,734 | 3,267,245 | |||
Exercise of warrants, shares | 851,099 | |||||
Foreign currency translation gain | 35,736 | 35,736 | ||||
Net loss | (3,250,711) | (3,250,711) | ||||
Ending balance, value at Mar. 31, 2021 | $ 194,499 | 33,952,988 | (15,010,268) | (145,541) | 18,991,678 | |
Ending balance, shares at Mar. 31, 2021 | 19,449,975 | |||||
Beginning balance, value at Dec. 31, 2021 | $ 325,785 | 82,747,390 | (60,736,453) | (30,802) | 22,305,920 | |
Beginning balance, shares at Dec. 31, 2021 | 32,578,475 | |||||
Stock-based compensation | 768,619 | 768,619 | ||||
Foreign currency translation gain | 88,709 | 88,709 | ||||
Net loss | (4,524,014) | (4,524,014) | ||||
February 2022 registered direct offering | $ 200,000 | 5,602,464 | 5,802,464 | |||
February 2022 registered direct offering, shares | 20,000,000 | |||||
Conversion of RSUs into common shares | $ 449 | (449) | ||||
Conversion of RSUs into common shares, shares | 44,932 | |||||
Ending balance, value at Mar. 31, 2022 | $ 526,234 | $ 89,118,024 | $ (65,260,467) | $ 57,907 | $ 24,441,698 | |
Ending balance, shares at Mar. 31, 2022 | 52,623,407 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Cash Flows From Operating Activities: | ||
Net loss | $ (4,524,014) | $ (3,250,711) |
Adjustments to reconcile net loss to cash used in operating activities | ||
Change in fair value of warrant liability | (275,969) | (3,813,000) |
Stock-based compensation | 768,619 | 3,591,565 |
Inducement expense | 298,714 | |
Amortization of right-of-use asset | 34,455 | |
Amortization of intangible assets | 42,188 | 136,640 |
Depreciation expense | 27,077 | |
Change in operating assets and liabilities: | ||
Prepaid expenses and other current assets | (588,975) | (66,208) |
Accounts payable and accrued liabilities | 6,021 | (59,278) |
Right-of-use operating lease liability | (38,343) | |
Net cash used in operating activities | (4,548,941) | (3,162,278) |
Cash Flows From Investing Activities: | ||
Purchases of property and equipment | (505,507) | |
Purchase of license agreement | (675,000) | |
Net cash used in investing activities | (505,507) | (675,000) |
Cash Flows From Financing Activities: | ||
Proceeds from sale of common stock and warrants, net of offering costs | 9,397,884 | 21,614,488 |
Proceeds from warrant exercises | 3,267,245 | |
Net cash provided by financing activities | 9,397,884 | 24,881,733 |
Effect of foreign exchange rate on cash | (4,900) | 34,235 |
Net increase in cash | 4,338,536 | 21,078,690 |
Cash at beginning of period | 17,355,999 | 1,578,460 |
Cash at end of period | 21,694,535 | 22,657,150 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 4,138 | |
Supplemental disclosure of non-cash investing and financing activities: | ||
Warrants issued in conjunction with common stock issuance | $ 3,595,420 |
NATURE OF BUSINESS AND BASIS OF
NATURE OF BUSINESS AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF BUSINESS AND BASIS OF PRESENTATION | 1. NATURE OF BUSINESS AND BASIS OF PRESENTATION Nature of Operations Enveric Biosciences, Inc. (“Enveric Biosciences, Inc.” “Enveric” or the “Company”) (formerly known as Ameri Holdings, Inc.) (“Ameri”) is a pharmaceutical company developing innovative, evidence-based cannabinoid medicines. The head office of the Company is located in Naples, Florida. The Company has the following wholly owned subsidiaries: Jay Pharma Inc. (“Jay Pharma”), 1306432 B.C. Ltd. (“HoldCo”), MagicMed Industries, Inc. (“MagicMed”), and Enveric Canada. The Company has an Amalgamation Agreement (“Amalgamation Agreement”) and tender agreement (“Tender Agreement”) with Jay Pharma, which were entered into in prior years. On May 24, 2021, the Company entered into an Amalgamation Agreement (the “Amalgamation Agreement”) with 1306432 B.C. Ltd., a corporation existing under the laws of the Province of British Columbia and a wholly-owned subsidiary of the Company (“HoldCo”), 1306436 B.C. Ltd., a corporation existing under the laws of the Province of British Columbia and a wholly-owned subsidiary of HoldCo (“Purchaser”), and MagicMed Industries Inc., a corporation existing under the laws of the Province of British Columbia (“MagicMed”), pursuant to which, among other things, the Company, indirectly through Purchaser, acquired all of the outstanding securities of MagicMed in exchange for securities of the Company by way of an amalgamation under the British Columbia Business Corporations Act, upon the terms and conditions set forth in the Amalgamation Agreement, such that, upon completion of the Amalgamation (as defined herein), the amalgamated corporation (“Amalco”) will be an indirect wholly-owned subsidiary of the Company. The Amalgamation was completed on September 16, 2021. At the effective time of the Amalgamation (the “Effective Time”), holders of outstanding common shares of MagicMed (the “MagicMed Shares”) received such number of shares of common stock of the Company (“Company Shares”) representing, together with the Company Shares issuable upon exercise of the Warrants and the Converted Options (each as defined herein), approximately 36.6 0.000001 9,951,217 31.7 7,404,101 The aggregate number of Company Shares that the Company issued in connection with the Amalgamation (collectively, the “Share Consideration”) was in excess of 20 Pursuant to the terms of the Amalgamation Agreement, the Company appointed, effective as of the Effective Time two individuals selected by MagicMed to the Company Board of Directors, Dr. Joseph Tucker and Dr. Brad Thompson. The Amalgamation Agreement contained representations and warranties, closing deliveries and indemnification provisions customary for a transaction of this nature. The closing of the Amalgamation was conditioned upon, among other things, (i) the Share Consideration being approved for listing on Nasdaq, (ii) the effectiveness of a Registration Statement on Form S-4 registering the Share Consideration and (iii) the approval (a) of the MagicMed stockholders of the Amalgamation and (b) of the Company’s stockholders of each of the Amalgamation and the issuance of the Share Consideration in the Amalgamation. The closing of the Amalgamation occurred on September 16, 2021. MagicMed Industries develops and commercializes psychedelic-derived pharmaceutical candidates. MagicMed’s psychedelic derivatives library, the Psybrary™, is an essential building block from which industry can develop new patented products. The initial focus of the Psybrary™ is on psilocybin and DMT derivatives, and it is then expected to be expanded to other psychedelics. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Liquidity and Going Concern and Other Uncertainties The Company has incurred continuing losses from its operations. As of March 31, 2022, the Company had an accumulated deficit of $ 65,260,467 20,571,914 The Company’s material cash requirements consist of working capital to fund capital expenditures incurred at their research facility in Calgary and their operations, which consist primarily of, without limitation, employee related expenses, product development activities conducted by third parties, research materials and lab supplies, facility related expenses including rent and maintenance, costs associated with preclinical studies, patent related costs, costs of regulatory and public company compliance, insurance costs, audit costs, consultants and legal fees. Additionally, the Company currently utilizes third-party contract CROs to assist with clinical development activities. If the Company obtains regulatory approval for any of their product candidates, they expect to incur significant expenses to engage third-party contract CMOs to carry out their clinical manufacturing activities as they do not yet have a commercial organization, and incur significant expenses related to developing their internal commercialization capability to support product sales, marketing and distribution. The Company’s current working capital resources are sufficient to fund these material cash requirements for the next twelve months. The Company expects to finance future cash needs through public or private equity offerings, debt financings, or business development transactions. If adequate funds are not available, the Company may be required to delay, reduce the scope of or eliminate research and development programs or obtain funds through arrangements with collaborators or others that may require the Company to relinquish rights to certain pipeline candidates that they might otherwise seek to develop or commercialize independently. The Company’s ability to finance future cash needs through equity offerings may be limited by the amount of authorized and unissued shares. As of the date of filing of this Quarterly Report on Form 10-Q, the Company does not have sufficient unreserved, authorized shares to secure an equity investment of sufficient amount, based on the Company’s currently traded price per share. The Company intends to seek shareholder approval for an increase in authorized shares to remedy the insufficiency of unreserved authorized shares. There can be no assurances given as to shareholder approval of an increase in authorized shares. Nasdaq Notice On February 18, 2022, the Company received a letter from the Listing Qualifications Department of the Nasdaq indicating that, based upon the closing bid price of the Company’s common stock for the 30 consecutive business day period between January 5, 2022, through February 17, 2022, the Company did not meet the minimum bid price of $ 1.00 In order to regain compliance with Nasdaq’s minimum bid price requirement, the Company’s common stock must maintain a minimum closing bid price of $ 1.00 While the letter has no immediate impact on the listing of the Company’s common stock, which will continue to be listed and traded on The Nasdaq Capital Market, subject to the Company’s compliance with the other listing requirements of The Nasdaq Capital Market, a failure to cure this deficiency would result in a delisting from the Nasdaq, which would result in significantly increased uncertainty as to the Company’s ability to raise capital required to fund its cash requirements. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principal of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Management’s opinion is that all adjustments (consisting of normal accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2021 and related notes thereto included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 31, 2022. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The Company’s significant accounting policies and recent accounting standards are summarized in Note 2 of the Company’s financial statements for the year ended December 31, 2021. There were no significant changes to these accounting policies during the three months ended March 31, 2022. Reclassification Certain reclassifications have been made to the prior period financial statements to conform to the current period financial statement presentation. Certain amounts related to depreciation and amortization from the prior period were reclassified from General and administrative line item to Depreciation and amortization line item on the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income (Loss). These reclassifications had no net effect on loss from operations, net loss, or cash flows as previously reported. Use of Estimates The preparation of the unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and expenses during the periods reported. By their nature, these estimates are subject to measurement uncertainty and the effects on the financial statements of changes in such estimates in future periods could be significant. Significant areas requiring management’s estimates and assumptions include determining the fair value of transactions involving common stock and the valuation of stock-based compensation, accruals associated with third party providers supporting research and development efforts, estimated fair values of long lives assets used to record impairment charges related to intangible assets, acquired in-process research and development (“IPR&D”), and goodwill, and allocation of purchase price in business acquisitions. Actual results could differ from those estimates. Foreign Currency Translation From inception through March 31, 2022, the reporting currency of the Company was the United States dollar while the functional currency of the Company’s subsidiaries was the Canadian dollar. For the reporting periods ended March 31, 2022 and March 31, 2021, the Company engaged in a number of transactions denominated in Canadian dollars. As a result, the Company is subject to exposure from changes in the exchange rates of the Canadian dollar and the U.S. dollar. The Company translates the assets and liabilities of its Canadian subsidiaries into the U.S. dollar at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the average exchange rate in effect during each monthly period. Unrealized translation gains and losses are recorded as foreign currency translation gain (loss), which is included in the consolidated statements of shareholders’ equity as a component of accumulated other comprehensive income (loss). The Company has not entered into any financial derivative instruments that expose it to material market risk, including any instruments designed to hedge the impact of foreign currency exposures. The Company may, however, hedge such exposure to foreign currency exchange fluctuations in the future. Adjustments that arise from exchange rate changes on transactions denominated in a currency other than the local currency are included in other comprehensive income (loss) in the consolidated statements of operations and comprehensive income (loss) as incurred. Warrant Liability The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The Company accounts for warrants for shares of the Company’s common stock that are not indexed to its own stock as derivative liabilities at fair value on the unaudited condensed consolidated balance sheets. The Company accounts for common stock warrants with put options as liabilities under ASC 480. Such warrants are subject to remeasurement at each unaudited condensed consolidated balance sheet date and any change in fair value is recognized as a component of other expense on the unaudited condensed consolidated statements of operations. The Company will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of such common stock warrants. At that time, the portion of the warrant liability related to such common stock warrants will be reclassified to additional paid-in capital. Offering Costs The Company allocates offering costs to the different components of the capital raise on a pro rata basis. Any offering costs allocated to common stock are charged directly to additional paid-in capital. Any offering costs allocated to warrant liabilities are charged to general and administrative expenses on the Company’s unaudited condensed consolidated statement of operations. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Net Loss per Share Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and warrants (using the treasury stock method). The computation of basic net loss per share for the three months ended March 31, 2022 and 2021 excludes potentially dilutive securities. The computations of net loss per share for each period presented is the same for both basic and fully diluted. In accordance with ASC 260-10-45-13, penny warrants were included in the calculation of weighted average shares outstanding for purposes of calculating basic and diluted earnings per share. Potentially dilutive securities outlined in the table below have been excluded from the computation of diluted net loss per share for the three months ended March 31, 2022 and 2021 because the effect of their inclusion would have been anti-dilutive. SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES 2022 2021 For the Three Months Ended March 31, 2022 2021 Warrants to purchase shares of common stock 32,768,766 5,979,611 Restricted stock units - vested and unissued 2,785,820 1,207,825 Restricted stock units - unvested 4,793,102 2,071,459 Restricted stock awards - vested and unissued 42,131 44,390 Restricted stock awards - unvested 6,477 26,596 Options to purchase shares of common stock 1,141,434 369,361 Total potentially dilutive securities 41,537,730 9,699,242 Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1 - Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2 - Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3 - Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. For certain financial instruments, including cash, accounts receivable, and accounts payable, the carrying amounts approximate their fair values as of March 31, 2022 and December 31, 2021 because of their short-term nature. The following table provides the financial liabilities measured on a recurring basis and reported at fair value on the balance sheet as of March 31, 2022 and indicates the fair value of the valuation inputs the Company utilized to determine such fair value: SCHEDULE OF FAIR VALUE HIERARCHY OF VALUATION INPUTS ON RECURRING BASIS Level March 31, 2022 December 31, 2021 Warrant liabilities - January 2021 Warrants 3 $ 41,201 $ 333,471 Warrant liabilities - February 2021 Warrants 3 41,695 320,203 Warrant liabilities - February 2022 Warrants 3 3,890,229 — Fair value as of March 31, 2022 $ 3,973,125 $ 653,674 Fair value $ 3,973,125 $ 653,674 The warrant liabilities are all classified as Level 3, for which there is no current market for these securities such as the determination of fair value requires significant judgment or estimation. Changes in fair value measurement categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Initial measurement The Company established the initial fair value of its warrant liabilities at the respective dates of issuance. The Company used a Black Scholes valuation model in order to determine their value. The key inputs into the Black Scholes valuation model for the initial valuations are below: SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES February 2022 Warrants February 15, 2022 Term (years) 5.0 Stock price $ 0.32 Exercise price $ 0.55 Dividend yield — % Expected volatility 74.1 % Risk free interest rate 1.9 % Number of warrants 23,000,000 Value (per share) $ 0.16 Subsequent measurement The following table presents the changes in fair value of the warrant liabilities: SCHEDULE OF FAIR VALUE OF WARRANT LIABILITIES Total Warrant Liabilities Fair value as of December 31, 2021 $ 653,674 Issuance of February 2022 warrants 3,595,420 Change in fair value (275,969 ) Fair value as of March 31, 2022 $ 3,973,125 The key inputs into the Black Scholes valuation model for the Level 3 valuations as of March 31, 2022 are below: SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES January 2021 Warrants February 2021 Warrants February 2022 Warrants Term (years) 3.8 3.9 4.9 Stock price $ 0.33 $ 0.33 $ 0.33 Exercise price $ 4.95 $ 4.90 $ 0.55 Dividend yield — % — % — % Expected volatility 76.0 % 76.0 % 75.3 % Risk free interest rate 2.44 % 2.44 % 2.42 % Number of warrants 1,821,449 1,714,005 23,000,000 Value (per share) $ 0.02 $ 0.02 $ 0.17 Leases Operating lease assets are included within right-of-use operating lease asset and operating lease liabilities are included in current portion of right-of-use operating lease obligation and non-current portion of right-of-use operating lease obligation on the consolidated balance sheet as of March 31, 2022. The Company has elected not to present short-term leases as these leases have a lease term of 12 months or less at lease inception and do not contain purchase options or renewal terms that the Company is reasonably certain to exercise. All other lease assets and lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate of return, the Company used an incremental borrowing rate based on the information available at adoption date in determining the present value of lease payments. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | 3. INTANGIBLE ASSETS AND GOODWILL As of March 31, 2022, the Company’s intangible assets consisted of: SCHEDULE OF GOODWILL INDEFINITE AND FINITE LIVED INTANGIBLE ASSETS Goodwill Balance at December 31, 2021 $ 1,587,634 Gain on currency translation 23,146 Balance at March 31, 2022 $ 1,610,780 Indefinite lived intangible assets Balance at December 31, 2021 $ 6,375,492 Gain on currency translation 92,948 Balance at March 31, 2022 $ 6,468,440 Definite lived intangible assets Balance at December 31, 2021 $ 548,436 Amortization (42,188 ) Balance at March 31, 2022 $ 506,248 For goodwill, identified indefinite lived assets, and identified definite lived intangible assets, there was no impairment expense during the three months ended March 31, 2022 and 2021. For identified definite lived intangible assets, amortization expense amounted to $ 42,188 136,640 The Company amortizes definite lived intangible assets on a straight-line basis over their estimated useful lives. Amortization expense of identified intangible assets based on the carrying amount as of March 31, 2022 is as follows: SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES Year ending December 31, 2022 (excluding the three months ended March 31) $ 126,563 2023 168,750 2024 168,750 2025 42,185 Finite lived Assets Amortization Expense $ 506,248 |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 4. PROPERTY AND EQUIPMENT Property and equipment consists of the following assets which are located in Calgary, Canada and placed in service by Enveric Biosciences Canada, Inc (“EBCI”), with all amounts translated into U.S. dollars: SCHEDULE OF PROPERTY PLANT AND EQUIPMENT NET OF ACCUMULATED DEPRECIATION March 31, 2022 December 31, 2021 Lab equipment $ 814,555 $ 310,957 Computer equipment 16,660 10,818 Property and Equipment, gross Less: Accumulated depreciation (54,422 ) (27,345 ) Property and equipment, net of accumulated depreciation $ 776,793 $ 294,430 Depreciation expense was $ 27,077 — ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
SHARE CAPITAL AND OTHER EQUITY
SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS | 3 Months Ended |
Mar. 31, 2022 | |
Equity [Abstract] | |
SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS | 5. SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS Authorized Capital The holders of the Company’s common stock (“Common Stock”) are entitled to one vote per share. Holders of common stock are entitled to receive ratably such dividends, if any, as may be declared by the Board of Directors out of legally available funds. Upon the liquidation, dissolution, or winding up of the Company, holders of common stock are entitled to share ratably in all assets of the Company that are legally available for distribution. As of March 31, 2022, 100,000,000 On December 30, 2020, the Company amended its articles of incorporation to designate and authorize 20,000,000 3,600,000 3,275,407 3,275,407 no Common Stock Activity On February 15, 2022, the Company completed a public offering of 20,000,000 20,000,000 10 3,000,000 3,000,000 3,000,000 9.1 5.8 3.6 0.3 During the three months ended March 31, 2022, a total of 44,932 Stock Options A summary of activity under the Company’s incentive plan for the three months ended March 31, 2022 is presented below: SCHEDULE OF STOCK OPTION Number of Shares Weighted Average Exercise Price Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding at December 31, 2021 1,191,434 $ 1.58 $ 2.07 5.3 $ 34,333 Forfeited (50,000 ) 3.50 2.81 — — Outstanding at March 31, 2022 1,141,434 $ 1.50 $ 2.03 4.9 $ — Exercisable at March 31, 2022 958,915 $ 1.50 $ 2.01 4.2 $ — The Company’s stock based compensation expense, recorded within general and administrative expense, related to stock options for the three months ended March 31, 2022 and 2021 was $ 36,989 and $ , respectively. As of March 31, 2022, the Company had $ 319,895 in unamortized stock option expense, which will be recognized over a weighted average period of 1.8 years. During the three months ended March 31, 2021, the Company exchanged options to purchase 560,404 325,410 42,125 298,714 Restricted Stock Awards The Company’s activity in restricted common stock was as follows for the three months ended March 31, 2022: SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY Number of shares Weighted average fair value Non-vested at December 31, 2021 51,509 $ 2.83 Granted 1,872,215 $ 0.67 Forfeited (35,000 ) $ 2.93 Vested (10,032 ) $ 3.05 Non-vested at March 31, 2022 6,477 $ 1.93 ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS For the three months ended March 31, 2022 and 2021, the Company recorded $ 11,863 and $ 32,112 , in stock-based compensation expense within general and administrative expense, related to restricted stock awards, respectively. As of March 31, 2022, unamortized stock-based compensation costs related to restricted share awards was $ 12,500 , which will be recognized over a weighted average period of 0.5 years. The balance of Common Shares related to the vested restricted stock awards as of March 31, 2022 will be issued during the 2022 calendar year. There are 42,131 vested and unissued shares of restricted stock awards as of March 31, 2022. Issuance of Restricted Stock Units The Company’s activity in restricted stock units was as follows for the three months ended March 31, 2022: SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY Number of shares Weighted average fair value Non-vested at December 31, 2021 3,100,613 $ 2.52 Granted 1,872,215 $ 0.67 Forfeited (134,794 ) $ 3.99 Vested (44,932 ) $ 3.99 Non-vested at March 31, 2022 4,793,102 $ 1.75 For the three months ended March 31, 2022 and 2021, the Company recorded $ 719,767 3,559,453 7,070,834 3.4 44,932 2,785,820 The following table summarizes the Company’s recognition of stock-based compensation for restricted stock units for the following periods: SCHEDULE OF STOCK-BASED COMPENSATION FOR RESTRICTED STOCK UNITS Three months ended March 31, Stock-based compensation for RSU 2022 2021 General and administrative $ 358,818 $ 3,559,453 Research and development 360,949 — Total $ 719,767 $ 3,559,453 Stock-based compensation $ 719,767 $ 3,559,453 Warrants On February 11, 2022, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with A.G.P./Alliance Global Partners (the “Underwriter”). Pursuant to the Underwriting Agreement, the Company agreed to sell, in a firm commitment offering, 20,000,000 0.01 20,000,000 3,000,000 3,000,000 0.55 0.50 3,000,000 The following table summarizes information about shares issuable under warrants outstanding at March 31, 2022: SCHEDULE OF WARRANTS Warrant shares outstanding Weighted average exercise price Weighted average remaining life Intrinsic value Outstanding at December 31, 2021 9,768,766 $ 2.62 3.4 $ 801,024 Granted 23,000,000 0.55 — — Outstanding at March 31, 2022 32,768,766 $ 1.17 4.4 $ 35,729 Exercisable at March 31, 2022 32,768,766 $ 1.17 4.4 $ 35,729 The warrants assumed pursuant to the acquisition of MagicMed contain certain down round features, which were not triggered by the February 2022 public offering, that would require adjustment to the exercise price upon certain events when the offering price is less than the stated exercise price. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 6. COMMITMENTS AND CONTINGENCIES The Company is periodically involved in legal proceedings, legal actions and claims arising in the normal course of business. Management believes that the outcome of such legal proceedings, legal actions and claims will not have a significant adverse effect on the Company’s financial position, results of operations or cash flows. Development and Clinical Supply Agreement On February 22, 2021, the Company entered into a Development and Clinical Supply Agreement (the “PureForm Agreement”) with PureForm Global, Inc. (“PureForm”), pursuant to which PureForm will be the exclusive provider of synthetic cannabidiol (“API”) for the Company’s development plans for cancer treatment and supportive care. Under the terms of the PureForm Agreement, PureForm has granted the Company the exclusive right to purchase API and related product for cancer treatment and supportive care during the term of the Agreement (contingent upon an initial minimum order of 1 kilogram during the first thirty (30) days from the effective date) and has agreed to manufacture, package and test the API and related product in accordance with specifications established by the parties. All inventions that are developed jointly by the parties in the course of performing activities under the PureForm Agreement will be owned jointly by the parties in accordance with applicable law; however, if the Company funds additional research and development efforts by PureForm, the parties may enter into a further agreement whereby PureForm would assign any resulting inventions or technical information to the Company. The initial term of the PureForm Agreement is three (3) years commencing on the effective date of the Agreement, subject to extension by mutual agreement of the parties. The PureForm Agreement may be terminated by either party upon thirty (30) days written notice of an uncured material breach or immediately in the event of bankruptcy or insolvency. The Agreement contains, among other provisions, representation and warranties, indemnification obligations and confidentiality provisions in favor of each party that are customary for an agreement of this nature. The Company has met the minimum purchase requirement of 1 kilogram during the first thirty days of the PureForm Agreement’s effectiveness. Purchase agreement with Prof. Zvi Vogel and Dr. Ilana Nathan On December 26, 2017, Jay Pharma entered into a purchase agreement with Prof. Zvi Vogel and Dr. Ilana Nathan (the “Vogel-Nathan Purchase Agreement”), pursuant to which Jay Pharma was assigned ownership rights to certain patents, which were filed and unissued as of the date of the Vogel-Nathan Purchase Agreement. The Vogel-Nathan Purchase Agreement includes a commitment to pay a one-time milestone totaling $ 200,000 300,000 2 20 ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Agreement with Tikkun License Agreement Jay Pharma, Tikkun Olam LLC (“TO LLC”) and Tikkun Olam Hemp LLC (“TOH”) entered into a license agreement dated on January 10, 2020, pursuant to which Jay Pharma would acquire certain in-licensed and owned intellectual property rights related to the cannabis products in the United States (presently excluding the state of New York) from TO LLC and TOH, each of which is an affiliate of TO Holdings, in exchange for royalty payments of (i) four percent (4.0%) of net sales of OTC cancer products made via consumer channels; (ii) five percent (5.0%) of net sales of beauty products made via consumer channels; and (iii) three percent (3.0%) of net sales of OTC cancer products made via professional channels, along with a minimum net royalty payment starting in January 1, 2022 and progressively increasing up to a cap of $400,000 maximum each year for the first 10 years, then $600,000 maximum each year for the next 5 years, and an annual maximum cap of $750,000 each year thereafter during the term of the agreement On August 12, 2020, Jay Pharma, TO LLC and TOH entered into the First Amendment to the License Agreement, pursuant to which all references to the Original Amalgamation Agreement and the amalgamation were revised to be references to the Tender Agreement and the Offer, as applicable. On October 2, 2020, Jay Pharma, TO LLC and TOH entered into the Second Amendment to the License Agreement, pursuant to which the effective date of the transactions was revised to occur as of October 2, 2020. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | 7. INCOME TAXES On September 16, 2021, the Company acquired MagicMed. In connection with the acquisition, the Company recorded intangible assets from IPR&D valued at $ 35,500,000 , which would be tested for impairment for book purposes, but without a tax basis, creating a deferred tax liability of $ 9,061,927 . The deferred tax liability decreased to $ 1,607,122 due to an impairment on intangible assets of $ 29,048,164 and an impairment of goodwill of $ 8,225,862 for the year ended December 31, 2021. As of March 31, 2022, the balance of the deferred tax liability is $ 1,630,552 . |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 8. SUBSEQUENT EVENTS Spin-Off and Related Private Placement On May 11, 2022, the Company announced plans to transfer and spin-off its cannabinoid clinical development pipeline assets to a wholly-owned subsidiary, Acanna Therapeutics, Inc. (“Acanna”), which was incorporated on April 13, 2022, by way of dividend to Enveric shareholders (the “Spin-Off”). The Spin-Off will be subject to various conditions, including Acanna meeting the qualifications for listing on The Nasdaq Stock Market, and if successful, would result in two standalone public companies. In connection with the Spin-Off, on May 5, 2022, Acanna and the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with an accredited investor (the “Investor”), pursuant to which Acanna agreed to sell up to an aggregate of 5,000 0.01 1,000 0.01 5,000,000 1,000 1,000,000 4,000,000 Palladium Capital Advisors, LLC (“Palladium”) acted as placement agent for the Private Placement. Pursuant to the Purchase Agreement, Acanna has agreed to pay Palladium a cash fee equal to 9% 1% 8% Terms of Acanna Series A Preferred Stock Under the Certificate of the Designations, Preferences and Rights of Series A Convertible Preferred Stock (the “Certificate of Designations”), on or immediately prior to the Spin-Off Date, the outstanding Acanna Series A Preferred Stock will be automatically converted into a number of shares of Acanna Common Stock equal to 25% The Certificate of Designations contains limitations that prevent the holder thereof from acquiring shares of Acanna Common Stock upon conversion that would result in the number of shares of Acanna Common Stock beneficially owned by such holder and its affiliates exceeding 9.99% The Certificate of Designations provides that upon the earlier of (i) the one-year anniversary of May 5, 2022, and only in the event that the Spin-Off has not occurred; or (ii) such time that Acanna and the Company have abandoned the Spin-Off or the Company is no longer pursuing the Spin-Off in good faith, the holders of the Acanna Series A Preferred Stock shall have the right (the “Put Right”), but not the obligation, to cause Acanna to purchase all or a portion of the Acanna Series A Preferred Stock for a purchase price equal to $ 1,000 5% Registration Rights Agreement In connection with the Private Placement, Acanna entered into a registration rights agreement, dated as of May 5, 2022 (the “Registration Rights Agreement”), with the Investor, pursuant to which Acanna shall, on such date that Acanna files a registration statement with the SEC in connection with the Spin-Off, file such a registration statement to register the shares of Acanna Common Stock issuable upon: (i) the conversion of the Acanna Series A Preferred Stock sold in the Private Placement, (ii) the exercise of the Warrants sold in the Private Placement, and (iii) the conversion or exercise, as applicable, of the Palladium Securities (the “Registrable Securities”); and to cause such registration statement to be declared effective under the Securities Act of 1933, as amended (the “Securities Act”), as promptly as possible after the filing thereof, but in any event no later than the Spin-Off Date, and shall use its reasonable best efforts to keep such registration statement continuously effective under the Securities Act until the date that all Registrable Securities covered by such registration statement have been sold or are otherwise able to be sold pursuant to Rule 144 promulgate under the Securities Act. The Registration Rights Agreement provides for liquidated damages to the extent that Acanna does not file or maintain a registration statement in accordance with the terms thereof. Series C Preferred Stock On May 3, 2022, the Board of Directors (the “Board”) declared a dividend of one one-thousandth of a share of Series C Preferred Stock (“Series C Preferred Stock”) for each outstanding share of Common Stock (the “Common Stock”) held of record as of 5:00 p.m. Eastern Time on May 13, 2022 (the “Record Date”). The outstanding shares of Series C Preferred Stock will vote together with the outstanding shares of the Company’s Common Stock, as a single class, exclusively with respect to a proposal to increase the number of authorized shares of the Company’s Common Stock, a proposal giving the Board of Directors the authority, as it determines appropriate, to implement a reverse stock split within twelve months following the approval of such proposal by the Company’s stockholders, as well as any proposal to adjourn any meeting of stockholders called for the purpose of voting on the foregoing matters. If these proposals do not receive approval at a meeting of stockholders duly called for the purpose of voting thereon, the Company may be unable to regain compliance with Nasdaq’s minimum bid price requirement within the required period of time, which could lead to our Common Stock being delisted. If we are unable to maintain the listing of our Common Stock on Nasdaq, we may face difficulty raising additional capital. No shares of Series C Preferred Stock may be transferred by the holder thereof except in connection with a transfer by such holder of any shares of Common Stock held by such holder. Each share of Series C Preferred Stock will entitle the holder thereof to 1,000,000 votes per share (and, for the avoidance of doubt, each fraction of a share of Series C Preferred Stock will have a ratable number of votes). Thus, each one-thousandth of a share of Series C Preferred Stock would entitle the holder thereof to 1,000 votes. The holder of Series C Preferred Stock, as such, will not be entitled to receive dividends of any kind. The Series C Preferred Stock will rank senior to the Common Stock as to any distribution of assets upon a liquidation, dissolution or winding up of the Company, whether voluntarily or involuntarily (a “Dissolution”). |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Principal of Consolidation | Basis of Presentation and Principal of Consolidation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Management’s opinion is that all adjustments (consisting of normal accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements for the year ended December 31, 2021 and related notes thereto included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 31, 2022. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS The Company’s significant accounting policies and recent accounting standards are summarized in Note 2 of the Company’s financial statements for the year ended December 31, 2021. There were no significant changes to these accounting policies during the three months ended March 31, 2022. |
Reclassification | Reclassification Certain reclassifications have been made to the prior period financial statements to conform to the current period financial statement presentation. Certain amounts related to depreciation and amortization from the prior period were reclassified from General and administrative line item to Depreciation and amortization line item on the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income (Loss). These reclassifications had no net effect on loss from operations, net loss, or cash flows as previously reported. |
Use of Estimates | Use of Estimates The preparation of the unaudited condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities at the date of the financial statements and expenses during the periods reported. By their nature, these estimates are subject to measurement uncertainty and the effects on the financial statements of changes in such estimates in future periods could be significant. Significant areas requiring management’s estimates and assumptions include determining the fair value of transactions involving common stock and the valuation of stock-based compensation, accruals associated with third party providers supporting research and development efforts, estimated fair values of long lives assets used to record impairment charges related to intangible assets, acquired in-process research and development (“IPR&D”), and goodwill, and allocation of purchase price in business acquisitions. Actual results could differ from those estimates. |
Foreign Currency Translation | Foreign Currency Translation From inception through March 31, 2022, the reporting currency of the Company was the United States dollar while the functional currency of the Company’s subsidiaries was the Canadian dollar. For the reporting periods ended March 31, 2022 and March 31, 2021, the Company engaged in a number of transactions denominated in Canadian dollars. As a result, the Company is subject to exposure from changes in the exchange rates of the Canadian dollar and the U.S. dollar. The Company translates the assets and liabilities of its Canadian subsidiaries into the U.S. dollar at the exchange rate in effect on the balance sheet date. Revenues and expenses are translated at the average exchange rate in effect during each monthly period. Unrealized translation gains and losses are recorded as foreign currency translation gain (loss), which is included in the consolidated statements of shareholders’ equity as a component of accumulated other comprehensive income (loss). The Company has not entered into any financial derivative instruments that expose it to material market risk, including any instruments designed to hedge the impact of foreign currency exposures. The Company may, however, hedge such exposure to foreign currency exchange fluctuations in the future. Adjustments that arise from exchange rate changes on transactions denominated in a currency other than the local currency are included in other comprehensive income (loss) in the consolidated statements of operations and comprehensive income (loss) as incurred. |
Warrant Liability | Warrant Liability The Company evaluates all of its financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and FASB ASC Topic 815, “Derivatives and Hedging” (“ASC 815”). The Company accounts for warrants for shares of the Company’s common stock that are not indexed to its own stock as derivative liabilities at fair value on the unaudited condensed consolidated balance sheets. The Company accounts for common stock warrants with put options as liabilities under ASC 480. Such warrants are subject to remeasurement at each unaudited condensed consolidated balance sheet date and any change in fair value is recognized as a component of other expense on the unaudited condensed consolidated statements of operations. The Company will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of such common stock warrants. At that time, the portion of the warrant liability related to such common stock warrants will be reclassified to additional paid-in capital. |
Offering Costs | Offering Costs The Company allocates offering costs to the different components of the capital raise on a pro rata basis. Any offering costs allocated to common stock are charged directly to additional paid-in capital. Any offering costs allocated to warrant liabilities are charged to general and administrative expenses on the Company’s unaudited condensed consolidated statement of operations. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
Net Loss per Share | Net Loss per Share Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed using the weighted average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and warrants (using the treasury stock method). The computation of basic net loss per share for the three months ended March 31, 2022 and 2021 excludes potentially dilutive securities. The computations of net loss per share for each period presented is the same for both basic and fully diluted. In accordance with ASC 260-10-45-13, penny warrants were included in the calculation of weighted average shares outstanding for purposes of calculating basic and diluted earnings per share. Potentially dilutive securities outlined in the table below have been excluded from the computation of diluted net loss per share for the three months ended March 31, 2022 and 2021 because the effect of their inclusion would have been anti-dilutive. SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES 2022 2021 For the Three Months Ended March 31, 2022 2021 Warrants to purchase shares of common stock 32,768,766 5,979,611 Restricted stock units - vested and unissued 2,785,820 1,207,825 Restricted stock units - unvested 4,793,102 2,071,459 Restricted stock awards - vested and unissued 42,131 44,390 Restricted stock awards - unvested 6,477 26,596 Options to purchase shares of common stock 1,141,434 369,361 Total potentially dilutive securities 41,537,730 9,699,242 |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value: Level 1 - Valuations based on quoted prices for identical assets and liabilities in active markets. Level 2 - Valuations based on observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data. Level 3 - Valuations based on unobservable inputs reflecting our own assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment. For certain financial instruments, including cash, accounts receivable, and accounts payable, the carrying amounts approximate their fair values as of March 31, 2022 and December 31, 2021 because of their short-term nature. The following table provides the financial liabilities measured on a recurring basis and reported at fair value on the balance sheet as of March 31, 2022 and indicates the fair value of the valuation inputs the Company utilized to determine such fair value: SCHEDULE OF FAIR VALUE HIERARCHY OF VALUATION INPUTS ON RECURRING BASIS Level March 31, 2022 December 31, 2021 Warrant liabilities - January 2021 Warrants 3 $ 41,201 $ 333,471 Warrant liabilities - February 2021 Warrants 3 41,695 320,203 Warrant liabilities - February 2022 Warrants 3 3,890,229 — Fair value as of March 31, 2022 $ 3,973,125 $ 653,674 Fair value $ 3,973,125 $ 653,674 The warrant liabilities are all classified as Level 3, for which there is no current market for these securities such as the determination of fair value requires significant judgment or estimation. Changes in fair value measurement categorized within Level 3 of the fair value hierarchy are analyzed each period based on changes in estimates or assumptions and recorded as appropriate. ENVERIC BIOSCIENCES, INC. AND SUBSIDIARIES NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS Initial measurement The Company established the initial fair value of its warrant liabilities at the respective dates of issuance. The Company used a Black Scholes valuation model in order to determine their value. The key inputs into the Black Scholes valuation model for the initial valuations are below: SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES February 2022 Warrants February 15, 2022 Term (years) 5.0 Stock price $ 0.32 Exercise price $ 0.55 Dividend yield — % Expected volatility 74.1 % Risk free interest rate 1.9 % Number of warrants 23,000,000 Value (per share) $ 0.16 Subsequent measurement The following table presents the changes in fair value of the warrant liabilities: SCHEDULE OF FAIR VALUE OF WARRANT LIABILITIES Total Warrant Liabilities Fair value as of December 31, 2021 $ 653,674 Issuance of February 2022 warrants 3,595,420 Change in fair value (275,969 ) Fair value as of March 31, 2022 $ 3,973,125 The key inputs into the Black Scholes valuation model for the Level 3 valuations as of March 31, 2022 are below: SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES January 2021 Warrants February 2021 Warrants February 2022 Warrants Term (years) 3.8 3.9 4.9 Stock price $ 0.33 $ 0.33 $ 0.33 Exercise price $ 4.95 $ 4.90 $ 0.55 Dividend yield — % — % — % Expected volatility 76.0 % 76.0 % 75.3 % Risk free interest rate 2.44 % 2.44 % 2.42 % Number of warrants 1,821,449 1,714,005 23,000,000 Value (per share) $ 0.02 $ 0.02 $ 0.17 |
Leases | Leases Operating lease assets are included within right-of-use operating lease asset and operating lease liabilities are included in current portion of right-of-use operating lease obligation and non-current portion of right-of-use operating lease obligation on the consolidated balance sheet as of March 31, 2022. The Company has elected not to present short-term leases as these leases have a lease term of 12 months or less at lease inception and do not contain purchase options or renewal terms that the Company is reasonably certain to exercise. All other lease assets and lease liabilities are recognized based on the present value of lease payments over the lease term at commencement date. Because most of the Company’s leases do not provide an implicit rate of return, the Company used an incremental borrowing rate based on the information available at adoption date in determining the present value of lease payments. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES | Potentially dilutive securities outlined in the table below have been excluded from the computation of diluted net loss per share for the three months ended March 31, 2022 and 2021 because the effect of their inclusion would have been anti-dilutive. SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES 2022 2021 For the Three Months Ended March 31, 2022 2021 Warrants to purchase shares of common stock 32,768,766 5,979,611 Restricted stock units - vested and unissued 2,785,820 1,207,825 Restricted stock units - unvested 4,793,102 2,071,459 Restricted stock awards - vested and unissued 42,131 44,390 Restricted stock awards - unvested 6,477 26,596 Options to purchase shares of common stock 1,141,434 369,361 Total potentially dilutive securities 41,537,730 9,699,242 |
SCHEDULE OF FAIR VALUE HIERARCHY OF VALUATION INPUTS ON RECURRING BASIS | The following table provides the financial liabilities measured on a recurring basis and reported at fair value on the balance sheet as of March 31, 2022 and indicates the fair value of the valuation inputs the Company utilized to determine such fair value: SCHEDULE OF FAIR VALUE HIERARCHY OF VALUATION INPUTS ON RECURRING BASIS Level March 31, 2022 December 31, 2021 Warrant liabilities - January 2021 Warrants 3 $ 41,201 $ 333,471 Warrant liabilities - February 2021 Warrants 3 41,695 320,203 Warrant liabilities - February 2022 Warrants 3 3,890,229 — Fair value as of March 31, 2022 $ 3,973,125 $ 653,674 Fair value $ 3,973,125 $ 653,674 |
SCHEDULE OF FAIR VALUE OF WARRANT LIABILITIES | The following table presents the changes in fair value of the warrant liabilities: SCHEDULE OF FAIR VALUE OF WARRANT LIABILITIES Total Warrant Liabilities Fair value as of December 31, 2021 $ 653,674 Issuance of February 2022 warrants 3,595,420 Change in fair value (275,969 ) Fair value as of March 31, 2022 $ 3,973,125 |
Initial Measurement [Member] | |
SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES | The Company established the initial fair value of its warrant liabilities at the respective dates of issuance. The Company used a Black Scholes valuation model in order to determine their value. The key inputs into the Black Scholes valuation model for the initial valuations are below: SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES February 2022 Warrants February 15, 2022 Term (years) 5.0 Stock price $ 0.32 Exercise price $ 0.55 Dividend yield — % Expected volatility 74.1 % Risk free interest rate 1.9 % Number of warrants 23,000,000 Value (per share) $ 0.16 |
Subsequent Measurement [Member] | |
SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES | The key inputs into the Black Scholes valuation model for the Level 3 valuations as of March 31, 2022 are below: SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES January 2021 Warrants February 2021 Warrants February 2022 Warrants Term (years) 3.8 3.9 4.9 Stock price $ 0.33 $ 0.33 $ 0.33 Exercise price $ 4.95 $ 4.90 $ 0.55 Dividend yield — % — % — % Expected volatility 76.0 % 76.0 % 75.3 % Risk free interest rate 2.44 % 2.44 % 2.42 % Number of warrants 1,821,449 1,714,005 23,000,000 Value (per share) $ 0.02 $ 0.02 $ 0.17 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
SCHEDULE OF GOODWILL INDEFINITE AND FINITE LIVED INTANGIBLE ASSETS | As of March 31, 2022, the Company’s intangible assets consisted of: SCHEDULE OF GOODWILL INDEFINITE AND FINITE LIVED INTANGIBLE ASSETS Goodwill Balance at December 31, 2021 $ 1,587,634 Gain on currency translation 23,146 Balance at March 31, 2022 $ 1,610,780 Indefinite lived intangible assets Balance at December 31, 2021 $ 6,375,492 Gain on currency translation 92,948 Balance at March 31, 2022 $ 6,468,440 Definite lived intangible assets Balance at December 31, 2021 $ 548,436 Amortization (42,188 ) Balance at March 31, 2022 $ 506,248 |
SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES | The Company amortizes definite lived intangible assets on a straight-line basis over their estimated useful lives. Amortization expense of identified intangible assets based on the carrying amount as of March 31, 2022 is as follows: SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES Year ending December 31, 2022 (excluding the three months ended March 31) $ 126,563 2023 168,750 2024 168,750 2025 42,185 Finite lived Assets Amortization Expense $ 506,248 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY PLANT AND EQUIPMENT NET OF ACCUMULATED DEPRECIATION | Property and equipment consists of the following assets which are located in Calgary, Canada and placed in service by Enveric Biosciences Canada, Inc (“EBCI”), with all amounts translated into U.S. dollars: SCHEDULE OF PROPERTY PLANT AND EQUIPMENT NET OF ACCUMULATED DEPRECIATION March 31, 2022 December 31, 2021 Lab equipment $ 814,555 $ 310,957 Computer equipment 16,660 10,818 Property and Equipment, gross Less: Accumulated depreciation (54,422 ) (27,345 ) Property and equipment, net of accumulated depreciation $ 776,793 $ 294,430 |
SHARE CAPITAL AND OTHER EQUIT_2
SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
SCHEDULE OF STOCK OPTION | A summary of activity under the Company’s incentive plan for the three months ended March 31, 2022 is presented below: SCHEDULE OF STOCK OPTION Number of Shares Weighted Average Exercise Price Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding at December 31, 2021 1,191,434 $ 1.58 $ 2.07 5.3 $ 34,333 Forfeited (50,000 ) 3.50 2.81 — — Outstanding at March 31, 2022 1,141,434 $ 1.50 $ 2.03 4.9 $ — Exercisable at March 31, 2022 958,915 $ 1.50 $ 2.01 4.2 $ — |
SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY | The Company’s activity in restricted common stock was as follows for the three months ended March 31, 2022: SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY Number of shares Weighted average fair value Non-vested at December 31, 2021 51,509 $ 2.83 Granted 1,872,215 $ 0.67 Forfeited (35,000 ) $ 2.93 Vested (10,032 ) $ 3.05 Non-vested at March 31, 2022 6,477 $ 1.93 |
SCHEDULE OF WARRANTS | The following table summarizes information about shares issuable under warrants outstanding at March 31, 2022: SCHEDULE OF WARRANTS Warrant shares outstanding Weighted average exercise price Weighted average remaining life Intrinsic value Outstanding at December 31, 2021 9,768,766 $ 2.62 3.4 $ 801,024 Granted 23,000,000 0.55 — — Outstanding at March 31, 2022 32,768,766 $ 1.17 4.4 $ 35,729 Exercisable at March 31, 2022 32,768,766 $ 1.17 4.4 $ 35,729 |
Restricted Stock Units (RSUs) [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY | The Company’s activity in restricted stock units was as follows for the three months ended March 31, 2022: SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY Number of shares Weighted average fair value Non-vested at December 31, 2021 3,100,613 $ 2.52 Granted 1,872,215 $ 0.67 Forfeited (134,794 ) $ 3.99 Vested (44,932 ) $ 3.99 Non-vested at March 31, 2022 4,793,102 $ 1.75 |
SCHEDULE OF STOCK-BASED COMPENSATION FOR RESTRICTED STOCK UNITS | The following table summarizes the Company’s recognition of stock-based compensation for restricted stock units for the following periods: SCHEDULE OF STOCK-BASED COMPENSATION FOR RESTRICTED STOCK UNITS Three months ended March 31, Stock-based compensation for RSU 2022 2021 General and administrative $ 358,818 $ 3,559,453 Research and development 360,949 — Total $ 719,767 $ 3,559,453 Stock-based compensation $ 719,767 $ 3,559,453 |
NATURE OF BUSINESS AND BASIS _2
NATURE OF BUSINESS AND BASIS OF PRESENTATION (Details Narrative) - USD ($) | May 24, 2021 | Mar. 31, 2022 | Feb. 18, 2022 | Dec. 31, 2021 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Shares issue and outstanding percentage | 36.60% | |||
Share issued price per share | $ 1 | |||
Retained earnings | $ 65,260,467 | $ 60,736,453 | ||
Working capital | $ 20,571,914 | |||
Minimum [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Share issued price per share | $ 1 | |||
Amalgamation Agreement [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Shares issue and outstanding percentage | 31.70% | |||
Stock issued during period, shares | 9,951,217 | |||
Amalgamation Agreement [Member] | Shares consideration [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Shares issue and outstanding percentage | 20.00% | |||
Amalgamation Agreement [Member] | Redeemable preferred shares [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Share issued price per share | $ 0.000001 | |||
Amalgamation Agreement [Member] | Warrant [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Stock issued during period, shares | 7,404,101 |
SCHEDULE OF POTENTIALLY DILUTIV
SCHEDULE OF POTENTIALLY DILUTIVE SECURITIES (Details) - shares | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 41,537,730 | 9,699,242 |
Warrants to Purchase Shares of Common Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 32,768,766 | 5,979,611 |
Restricted Stock Units Vested and UnIssued [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 2,785,820 | 1,207,825 |
Restricted Stock Units Unvested [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 4,793,102 | 2,071,459 |
Restricted Stock Awards Vested and UnIssued [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 42,131 | 44,390 |
Restricted Stock Awards Unvested [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 6,477 | 26,596 |
Options to Purchase Shares of Common Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Total potentially dilutive securities | 1,141,434 | 369,361 |
SCHEDULE OF FAIR VALUE HIERARCH
SCHEDULE OF FAIR VALUE HIERARCHY OF VALUATION INPUTS ON RECURRING BASIS (Details) - Fair Value, Inputs, Level 3 [Member] - Fair Value, Recurring [Member] - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Class of Warrant or Right [Line Items] | ||
Fair value | $ 3,973,125 | $ 653,674 |
Warrant Liabilities January 2021 Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Fair value | 41,201 | 333,471 |
Warrant Liabilities February 2021 Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Fair value | 41,695 | 320,203 |
Warrant Liabilities February 2022 Warrants [Member] | ||
Class of Warrant or Right [Line Items] | ||
Fair value | $ 3,890,229 |
SCHEDULE OF BLACK SCHOLES VALUA
SCHEDULE OF BLACK SCHOLES VALUATION MODELS OF WARRANT LIABILITIES (Details) | Mar. 31, 2022$ / sharesshares | Feb. 15, 2022$ / sharesshares |
Initial Measurement [Member] | Measurement Input, Expected Dividend Rate [Member] | ||
Warrants, measurement input | ||
Initial Measurement [Member] | February Warrants [Member] | ||
Warrants term | 5 years | |
Warrants, number of warrants | shares | 23,000,000 | |
Warrants, value (per share) | $ 0.16 | |
Initial Measurement [Member] | February Warrants [Member] | Measurement Input, Share Price [Member] | ||
Warrants, stock price | 0.32 | |
Initial Measurement [Member] | February Warrants [Member] | Measurement Input, Exercise Price [Member] | ||
Warrants, exercise price | $ 0.55 | |
Initial Measurement [Member] | February Warrants [Member] | Measurement Input, Option Volatility [Member] | ||
Warrants, measurement input | 74.1 | |
Initial Measurement [Member] | February Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||
Warrants, measurement input | 1.9 | |
Subsequent Measurement [Member] | January 2021 Warrants [Member] | ||
Warrants term | 3 years 9 months 18 days | |
Warrants, number of warrants | shares | 1,821,449 | |
Warrants, value (per share) | $ 0.02 | |
Subsequent Measurement [Member] | January 2021 Warrants [Member] | Measurement Input, Share Price [Member] | ||
Warrants, stock price | 0.33 | |
Subsequent Measurement [Member] | January 2021 Warrants [Member] | Measurement Input, Exercise Price [Member] | ||
Warrants, exercise price | $ 4.95 | |
Subsequent Measurement [Member] | January 2021 Warrants [Member] | Measurement Input, Option Volatility [Member] | ||
Warrants, measurement input | 76 | |
Subsequent Measurement [Member] | January 2021 Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||
Warrants, measurement input | 2.44 | |
Subsequent Measurement [Member] | January 2021 Warrants [Member] | Measurement Input, Discount Rate [Member] | ||
Warrants, measurement input | ||
Subsequent Measurement [Member] | February 2021 Warrants [Member] | ||
Warrants term | 3 years 10 months 24 days | |
Warrants, number of warrants | shares | 1,714,005 | |
Warrants, value (per share) | $ 0.02 | |
Subsequent Measurement [Member] | February 2021 Warrants [Member] | Measurement Input, Share Price [Member] | ||
Warrants, stock price | 0.33 | |
Subsequent Measurement [Member] | February 2021 Warrants [Member] | Measurement Input, Exercise Price [Member] | ||
Warrants, exercise price | $ 4.90 | |
Subsequent Measurement [Member] | February 2021 Warrants [Member] | Measurement Input, Option Volatility [Member] | ||
Warrants, measurement input | 76 | |
Subsequent Measurement [Member] | February 2021 Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||
Warrants, measurement input | 2.44 | |
Subsequent Measurement [Member] | February 2021 Warrants [Member] | Measurement Input, Discount Rate [Member] | ||
Warrants, measurement input | ||
Subsequent Measurement [Member] | February 2022 Warrants [Member] | ||
Warrants term | 4 years 10 months 24 days | |
Warrants, number of warrants | shares | 23,000,000 | |
Warrants, value (per share) | $ 0.17 | |
Subsequent Measurement [Member] | February 2022 Warrants [Member] | Measurement Input, Share Price [Member] | ||
Warrants, stock price | 0.33 | |
Subsequent Measurement [Member] | February 2022 Warrants [Member] | Measurement Input, Exercise Price [Member] | ||
Warrants, exercise price | $ 0.55 | |
Subsequent Measurement [Member] | February 2022 Warrants [Member] | Measurement Input, Option Volatility [Member] | ||
Warrants, measurement input | 75.3 | |
Subsequent Measurement [Member] | February 2022 Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | ||
Warrants, measurement input | 2.42 | |
Subsequent Measurement [Member] | February 2022 Warrants [Member] | Measurement Input, Discount Rate [Member] | ||
Warrants, measurement input |
SCHEDULE OF FAIR VALUE OF WARRA
SCHEDULE OF FAIR VALUE OF WARRANT LIABILITIES (Details) - Subsequent Measurement [Member] - February Warrants [Member] | 3 Months Ended |
Mar. 31, 2022USD ($) | |
Total warrant liabilities, Beginning balance | $ 653,674 |
Issuance of February 2022 warrants | 3,595,420 |
[custom:FairValueMeasurementWithUnobservableInputsReconciliationsRecurringBasisLiabilityValueChangeInFairValue] | (275,969) |
Total warrant liabilities, Ending balance | $ 3,973,125 |
SCHEDULE OF GOODWILL INDEFINITE
SCHEDULE OF GOODWILL INDEFINITE AND FINITE LIVED INTANGIBLE ASSETS (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill, beginning balance | $ 1,587,634 | |
Goodwill, gain on currency translation | 23,146 | |
Goodwill, ending balance | 1,610,780 | |
Indefinite lived intangible assets, beginning balance | 6,375,492 | |
Indefinite lived intangible assets, gain on currency translation | 92,948 | |
Indefinite lived intangible assets, ending balance | 6,468,440 | |
Definite lived intangible assets, beginning balance | 548,436 | |
Definite lived intangible assets, amortization | (42,188) | $ (136,640) |
Definite lived intangible assets, ending balance | $ 506,248 |
SCHEDULE OF FINITE LIVED INTANG
SCHEDULE OF FINITE LIVED INTANGIBLE ASSETS AMORTIZATION EXPENSES (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2022 (excluding the three months ended March 31) | $ 126,563 | |
2023 | 168,750 | |
2024 | 168,750 | |
2025 | 42,185 | |
Finite lived Assets Amortization Expense | $ 506,248 | $ 548,436 |
INTANGIBLE ASSETS AND GOODWIL_2
INTANGIBLE ASSETS AND GOODWILL (Details Narrative) - USD ($) | Mar. 31, 2022 | Mar. 31, 2021 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Finite lived intangible assets, accumulated amortization | $ 42,188 | $ 136,640 |
SCHEDULE OF PROPERTY PLANT AND
SCHEDULE OF PROPERTY PLANT AND EQUIPMENT NET OF ACCUMULATED DEPRECIATION (Details) - USD ($) | Mar. 31, 2022 | Dec. 31, 2021 |
Property, Plant and Equipment [Line Items] | ||
Less: Accumulated depreciation | $ (54,422) | $ (27,345) |
Property and equipment, net of accumulated depreciation | 776,793 | 294,430 |
Lab Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, gross | 814,555 | 310,957 |
Computer Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property and Equipment, gross | $ 16,660 | $ 10,818 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 27,077 |
SCHEDULE OF STOCK OPTION (Detai
SCHEDULE OF STOCK OPTION (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2022 | Dec. 31, 2021 | |
Equity [Abstract] | ||
Number of shares, outstanding balance | 1,191,434 | |
Weighted average exercise price, outstanding balance | $ 1.58 | |
Weighted average grant date fair value, outstanding balance | $ 2.07 | |
Weighted average remaining contractual term, outstanding balance | 4 years 10 months 24 days | 5 years 3 months 18 days |
Aggregate intrinsic value, outstanding balance | $ 34,333 | |
Number of shares, forfeited | (50,000) | |
Weighted average exercise price, forfeited | $ 3.50 | |
Weighted average grant date fair value, forfeited | $ 2.81 | |
Number of shares, outstanding balance | 1,141,434 | 1,191,434 |
Weighted average exercise price, outstanding balance | $ 1.50 | $ 1.58 |
Weighted average grant date fair value, outstanding balance | $ 2.03 | $ 2.07 |
Aggregate intrinsic value, outstanding balance | $ 34,333 | |
Number of shares, exercisable | 958,915 | |
Weighted average exercise price, exercisable | $ 1.50 | |
Weighted average grant date fair value, exercisable | $ 2.01 | |
Weighted average remaining contractual term, exercisable | 4 years 2 months 12 days | |
Aggregate intrinsic value, exercisable |
SCHEDULE OF RESTRICTED STOCK UN
SCHEDULE OF RESTRICTED STOCK UNITS AND AWARDS ACTIVITY (Details) | 3 Months Ended |
Mar. 31, 2022$ / sharesshares | |
Restricted Stock [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares, non-vested beginning | shares | 51,509 |
Weighted average fair value, non-vested beginning | $ / shares | $ 2.83 |
Number of shares, forfeited | shares | (35,000) |
Weighted average fair value, forfeited | $ / shares | $ 2.93 |
Number of shares, vested | shares | (10,032) |
Weighted average fair value, vested | $ / shares | $ 3.05 |
Number of shares, non-vested ending | shares | 6,477 |
Weighted average fair value, non-vested ending | $ / shares | $ 1.93 |
Restricted Stock Units (RSUs) [Member] | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |
Number of shares, non-vested beginning | shares | 3,100,613 |
Weighted average fair value, non-vested beginning | $ / shares | $ 2.52 |
Number of shares, granted | shares | 1,872,215 |
Weighted average fair value, granted | $ / shares | $ 0.67 |
Number of shares, forfeited | shares | (134,794) |
Weighted average fair value, forfeited | $ / shares | $ 3.99 |
Number of shares, vested | shares | (44,932) |
Weighted average fair value, vested | $ / shares | $ 3.99 |
Number of shares, non-vested ending | shares | 4,793,102 |
Weighted average fair value, non-vested ending | $ / shares | $ 1.75 |
SCHEDULE OF STOCK-BASED COMPENS
SCHEDULE OF STOCK-BASED COMPENSATION FOR RESTRICTED STOCK UNITS (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2022 | Mar. 31, 2021 | |
Stock-based compensation | $ 719,767 | $ 3,559,453 |
General and Administrative Expense [Member] | ||
Stock-based compensation | 358,818 | 3,559,453 |
Research and Development Expense [Member] | ||
Stock-based compensation | $ 360,949 |
SCHEDULE OF WARRANTS (Details)
SCHEDULE OF WARRANTS (Details) - Warrant [Member] | 3 Months Ended |
Mar. 31, 2022USD ($)$ / sharesshares | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Warrant shares outstanding, outstanding beginning | shares | 9,768,766 |
Weighted average exercise price, outstanding beginning | $ / shares | $ 2.62 |
Weighted average remaining life, outstanding beginning | 3 years 4 months 24 days |
Intrinsic value, outstanding beginning | $ | $ 801,024 |
Warrant shares outstanding, granted | shares | 23,000,000 |
Weighted average exercise price, granted | $ / shares | $ 0.55 |
Warrant shares outstanding, outstanding ending | shares | 32,768,766 |
Weighted average exercise price, outstanding ending | $ / shares | $ 1.17 |
Weighted average remaining life, outstanding ended | 4 years 4 months 24 days |
Intrinsic value, outstanding ending | $ | $ 35,729 |
Warrant shares outstanding, exercisable | shares | 32,768,766 |
Weighted average exercise price, exercisable | $ / shares | $ 1.17 |
Weighted average remaining life, exercisable | 4 years 4 months 24 days |
Intrinsic value, exercisable | $ | $ 35,729 |
SHARE CAPITAL AND OTHER EQUIT_3
SHARE CAPITAL AND OTHER EQUITY INSTRUMENTS (Details Narrative) - USD ($) | Feb. 15, 2022 | Feb. 11, 2022 | Mar. 31, 2022 | Mar. 31, 2021 | Feb. 14, 2022 | Dec. 31, 2021 | Dec. 30, 2020 |
Class of Stock [Line Items] | |||||||
Common stock, shares authorized | 100,000,000 | 100,000,000 | |||||
Preferred stock, shares authorized | 20,000,000 | 20,000,000 | 20,000,000 | ||||
Proceeds from common stock | $ 9,397,884 | $ 21,614,488 | |||||
Number of shares of restricted stock units | 44,932 | ||||||
Stock based compensation, expenses | $ 719,767 | 3,559,453 | |||||
Inducement expense | $ 298,714 | ||||||
Warrant exercise price | 20,000,000 | ||||||
Additional warrant purchase | 3,000,000 | ||||||
Maximum [Member] | |||||||
Class of Stock [Line Items] | |||||||
Warrant exercise price | 3,000,000 | ||||||
Share-Based Payment Arrangement, Option [Member] | |||||||
Class of Stock [Line Items] | |||||||
Stock based compensation, expenses | 36,989 | ||||||
Stock-based compensation, unamortized | $ 319,895 | ||||||
Weighted average period | 1 year 9 months 18 days | ||||||
Options to purchase, shares | 560,404 | ||||||
Inducement expense | $ 298,714 | ||||||
Restricted Stock Units (RSUs) [Member] | |||||||
Class of Stock [Line Items] | |||||||
Stock based compensation, expenses | $ 719,767 | $ 3,559,453 | |||||
Stock-based compensation, unamortized | $ 7,070,834 | ||||||
Weighted average period | 3 years 4 months 24 days | ||||||
Options to purchase, shares | 325,410 | ||||||
Common stock , shares issued restricted stock awards | 44,932 | ||||||
Restricted Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Stock based compensation, expenses | $ 11,863 | $ 32,112 | |||||
Stock-based compensation, unamortized | $ 12,500 | ||||||
Weighted average period | 6 months | ||||||
Options to purchase, shares | 42,125 | ||||||
Common stock , shares issued restricted stock awards | 10,032 | ||||||
Underwriters [Member] | |||||||
Class of Stock [Line Items] | |||||||
Number of additional shares issued | 3,000,000 | ||||||
Warrants to purchase | 3,000,000 | ||||||
Exercise of warrants, shares | 3,000,000 | ||||||
Proceeds from issuance of warrants | $ 9,100,000 | ||||||
Offering expense | 5,800,000 | ||||||
Warrant liability | 3,600,000 | ||||||
Proceeds from public offering | $ 300,000 | ||||||
IPO [Member] | |||||||
Class of Stock [Line Items] | |||||||
Number of additional shares issued | 20,000,000 | ||||||
Warrants to purchase | 20,000,000 | ||||||
Proceeds from common stock | $ 10,000,000 | ||||||
Common Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Exercise of warrants, shares | 851,099 | ||||||
Number of shares sales | 20,000,000 | ||||||
Sale of stock, price per share | $ 0.01 | ||||||
Warrant exercise price | 0.55 | ||||||
Common Stock [Member] | Restricted Stock Units (RSUs) [Member] | |||||||
Class of Stock [Line Items] | |||||||
Common stock , shares issued restricted stock awards | 44,932 | ||||||
Common stock vested restricted stock units | 2,785,820 | ||||||
Common Stock [Member] | Restricted Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Common stock , shares issued restricted stock awards | 42,131 | ||||||
Common Stock Including Additional Paid in Capital [Member] | |||||||
Class of Stock [Line Items] | |||||||
Number of additional shares issued | 3,000,000 | ||||||
Warrant [Member] | |||||||
Class of Stock [Line Items] | |||||||
Sale of stock, price per share | $ 0.50 | ||||||
Series B Preferred Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares authorized | 3,600,000 | 3,600,000 | 3,600,000 | ||||
Preferred stock, convertion | 3,275,407 | ||||||
Number of additional shares issued | 3,275,407 | ||||||
Preferred stock, shares outstanding | 0 | 0 | |||||
Series B Preferred Stock [Member] | Preferred Stock [Member] | |||||||
Class of Stock [Line Items] | |||||||
Preferred stock, shares outstanding | 0 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Narrative) - USD ($) | Dec. 26, 2017 | Mar. 31, 2022 |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
License agreement description | Jay Pharma, Tikkun Olam LLC (“TO LLC”) and Tikkun Olam Hemp LLC (“TOH”) entered into a license agreement dated on January 10, 2020, pursuant to which Jay Pharma would acquire certain in-licensed and owned intellectual property rights related to the cannabis products in the United States (presently excluding the state of New York) from TO LLC and TOH, each of which is an affiliate of TO Holdings, in exchange for royalty payments of (i) four percent (4.0%) of net sales of OTC cancer products made via consumer channels; (ii) five percent (5.0%) of net sales of beauty products made via consumer channels; and (iii) three percent (3.0%) of net sales of OTC cancer products made via professional channels, along with a minimum net royalty payment starting in January 1, 2022 and progressively increasing up to a cap of $400,000 maximum each year for the first 10 years, then $600,000 maximum each year for the next 5 years, and an annual maximum cap of $750,000 each year thereafter during the term of the agreement | |
Vogal Nathan Purchase Agreement [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Royalties percentage | 2.00% | |
Payments for royalties | $ 20,000,000 | |
Vogal Nathan Purchase Agreement [Member] | One Time Milestone [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Long-term purchase commitment, amount | 200,000 | |
Vogal Nathan Purchase Agreement [Member] | Additional Milestone [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Long-term purchase commitment, amount | $ 300,000 |
INCOME TAXES (Details Narrative
INCOME TAXES (Details Narrative) - USD ($) | Sep. 16, 2021 | Dec. 31, 2021 | Mar. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | |||
Deferred Tax Liabilities, Net | $ 9,061,927 | ||
Increase (Decrease) in Deferred Liabilities | 1,607,122 | ||
Magic Med [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Deferred Tax Liabilities, Net | $ 1,630,552 | ||
Impairment, Long-Lived Asset, Held-for-Use | $ 29,048,164 | ||
Goodwill and Intangible Asset Impairment | $ 8,225,862 | ||
In Process Research and Development [Member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets Acquired | $ 35,500,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | May 05, 2022 | Feb. 11, 2022 |
Warrant [Member] | ||
Subsequent Event [Line Items] | ||
Sale of stock, price per share | $ 0.50 | |
Common Stock [Member] | ||
Subsequent Event [Line Items] | ||
Number of stock sold | 20,000,000 | |
Sale of stock, price per share | $ 0.01 | |
Subsequent Event [Member] | Series C Preferred Stock [Member] | ||
Subsequent Event [Line Items] | ||
Preferred stock, voting rights | Each share of Series C Preferred Stock will entitle the holder thereof to 1,000,000 votes per share (and, for the avoidance of doubt, each fraction of a share of Series C Preferred Stock will have a ratable number of votes). Thus, each one-thousandth of a share of Series C Preferred Stock would entitle the holder thereof to 1,000 votes. | |
Subsequent Event [Member] | Securities Purchase Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Sale of stock, price per share | $ 1,000 | |
Preferred stock, dividend rate, percentage | 5.00% | |
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Warrant [Member] | ||
Subsequent Event [Line Items] | ||
Percentage of warrants to be issued upon conversion | 8.00% | |
Subsequent Event [Member] | Securities Purchase Agreement [Member] | Series A Preferred Stock [Member] | ||
Subsequent Event [Line Items] | ||
Percentage of cash fee to be paid | 9.00% | |
Percentage of non accountable expense allowance | 1.00% | |
Percentage of stock issued and outstanding | 25.00% | |
Ownership percentage | 9.99% | |
Subsequent Event [Member] | Accredited Investor [Member] | Securities Purchase Agreement [Member] | ||
Subsequent Event [Line Items] | ||
Stock purchase price | $ 5,000,000 | |
Subsequent Event [Member] | Accredited Investor [Member] | Securities Purchase Agreement [Member] | Warrant [Member] | ||
Subsequent Event [Line Items] | ||
Sale of stock, price per share | $ 1,000 | |
Subsequent Event [Member] | Accredited Investor [Member] | Securities Purchase Agreement [Member] | Common Stock [Member] | ||
Subsequent Event [Line Items] | ||
Sale of stock, price per share | $ 0.01 | |
Subsequent Event [Member] | Accredited Investor [Member] | Securities Purchase Agreement [Member] | Series A Convertible Preferred Stock [Member] | ||
Subsequent Event [Line Items] | ||
Number of stock sold | 5,000 | |
Subsequent Event [Member] | Accredited Investor [Member] | Securities Purchase Agreement [Member] | Series A Preferred Stock [Member] | ||
Subsequent Event [Line Items] | ||
Sale of stock, price per share | $ 0.01 | |
Subsequent Event [Member] | Investor [Member] | Securities Purchase Agreement [Member] | Warrant [Member] | ||
Subsequent Event [Line Items] | ||
Fair value of common stock issued | $ 4,000,000 | |
Subsequent Event [Member] | Investor [Member] | Securities Purchase Agreement [Member] | Series A Preferred Stock [Member] | ||
Subsequent Event [Line Items] | ||
Number of common stock issued | 1,000 | |
Fair value of common stock issued | $ 1,000,000 |